Breaking Down the Meaning of Racketeer Influenced and Corrupt Organizations Act (RICO)

The Racketeer Influenced and Corrupt Organizations Act, or RICO, is a federal criminal law that specifically targets organizations that engage in a pattern of illegal activity. The law, passed in 1970, was originally meant to target organized crime. By working to eliminate illicit organizations before they become entrenched, RICO attempted to reduce the impact of criminal behavior across the United States.

Under RICO, criminal charges can be brought against an organization’s “leaders, managers, and supervisors.” Additionally, individuals associated with an organization can also face federal criminal charges for engaging in any activity which furthers the organization’s criminal goals. This includes both organizations with a formal structure (like corporations) and less formalized criminal groups.

RICO covers a large variety of criminal activities, including fraud, racketeering, bribery, obstruction of justice, money laundering, kidnapping, murder, counterfeiting, and other criminal activity. It also creates civil remedies that allow victims of the organization’s actions to sue for damages. For example, if an individual was a victim of fraud caused by an organization, they may be able to seek punitive damages.

Modern Examples of RICO Cases

One modern example of RICO in action saw two executives of a travel website indicted for allegedly conspiring to deny wages to their employees. It was also alleged that the two men used the power of their positions to silence employees, blocking them from coming forward with complaints and reporting false information to law enforcement.

Another recent example of a RICO case saw a drug distribution network pay a civil settlement of $67 million. The group had been engaging in a variety of activities, including money laundering, tax fraud, and drug distribution. The criminal charges filed against the organization saw several of its leaders facing up to 20 years in prison.

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Related Legal Concepts

Understanding RICO often intersects with other federal legislation designed to combat organizational misconduct. The Foreign Corrupt Practices Act of 1977 (FCPA) similarly targets corrupt business practices, while the Fraudulent Transfer Act addresses asset manipulation schemes that RICO defendants might employ. Additionally, the Administrative Procedure Act governs how federal agencies investigate and prosecute RICO violations, and the Truth in Lending Act (TILA) may overlap in cases involving financial fraud within criminal enterprises.

The Bottom Line

RICO represents a powerful federal tool designed to dismantle criminal organizations by targeting both leadership and associates who participate in patterns of illegal activity. The law’s broad scope allows prosecutors to address complex criminal enterprises that might otherwise escape traditional prosecution methods, while also providing civil remedies for victims. For guidance specific to your situation, always consult a qualified, licensed attorney.