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Racketeer Influenced and Corrupt Organizations Act

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The Racketeer Influenced and Corrupt Organizations Act (commonly referred to as RICO) is a United States federal law enacted as Title IX of the Organized Crime Control Act of 1970, codified at 18 U.S.C. §§ 1961–1968. The statute provides for extended criminal penalties and civil causes of action for acts performed as part of an ongoing criminal organization or enterprise.

History

RICO was enacted on October 15, 1970, as part of the Organized Crime Control Act, signed into law by President Richard Nixon. The statute was drafted primarily by G. Robert Blakey, a professor at Notre Dame Law School who served as chief counsel to the Senate Subcommittee on Criminal Laws and Procedures. While originally intended to combat organized crime, particularly La Cosa Nostra, the statute's broad language has been applied to a wide range of enterprises and criminal conduct beyond traditional organized crime.

The law was named after the fictional character Rico Bandello from the 1931 film Little Caesar, a detail later confirmed by Blakey himself.

How RICO Works

Pattern of Racketeering Activity

A RICO violation requires proof of a pattern of racketeering activity, defined as at least two predicate acts of racketeering committed within a ten-year period. The Supreme Court of the United States held in H.J. Inc. v. Northwestern Bell Telephone Co., 492 U.S. 229 (1989), that the pattern requirement demands both "relatedness" of the predicate acts and "continuity" of the racketeering activity — either closed-ended (a series of related acts extending over a substantial period) or open-ended (past conduct that by its nature projects a threat of continued criminal activity).

Enterprise

RICO requires the existence of an enterprise, defined broadly under 18 U.S.C. § 1961(4) as "any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." The Supreme Court in Boyle v. United States, 556 U.S. 938 (2009), held that an association-in-fact enterprise need only have a common purpose, relationships among those associated with the enterprise, and longevity sufficient to permit the associates to pursue the enterprise's purpose.

Enterprise Theory

Enterprise theory refers to the prosecutorial framework of treating an entire organization or group as a single criminal enterprise. Rather than prosecuting individual offenses in isolation, RICO allows federal prosecutors and civil plaintiffs to target the structure through which criminal activity is conducted. This approach enables the government or private plaintiff to hold all participants in the enterprise accountable for the pattern of racketeering activity, even if individual defendants committed different predicate acts.

Predicate Offenses

The list of predicate offenses (also called "racketeering activities") is enumerated in 18 U.S.C. § 1961(1) and includes both state and federal crimes:

State Offenses

  • Murder
  • Kidnapping
  • Gambling
  • Arson
  • Robbery
  • Bribery
  • Extortion
  • Dealing in obscene matter
  • Dealing in controlled substances

Federal Offenses

  • Mail fraud (18 U.S.C. § 1341)
  • Wire fraud (18 U.S.C. § 1343)
  • Bankruptcy fraud and false statements (18 U.S.C. §§ 152, 157)
  • Securities fraud (various provisions)
  • Money laundering (18 U.S.C. §§ 1956, 1957)
  • Obstruction of justice (18 U.S.C. § 1503)
  • Witness tampering (18 U.S.C. § 1512)
  • Bribery (18 U.S.C. § 201)
  • Counterfeiting (18 U.S.C. § 473)
  • Embezzlement from pension and welfare funds (18 U.S.C. § 664)
  • Fraud in connection with identification documents (18 U.S.C. § 1028)
  • Trafficking in contraband cigarettes (18 U.S.C. § 2342)
  • Acts of terrorism (various provisions)
  • Human trafficking (18 U.S.C. chapter 77)

Criminal RICO

Criminal RICO is prosecuted under 18 U.S.C. § 1962, which prohibits four types of conduct:

  • § 1962(a) — Using income derived from a pattern of racketeering activity to acquire an interest in or establish an enterprise
  • § 1962(b) — Acquiring or maintaining an interest in an enterprise through a pattern of racketeering activity
  • § 1962(c) — Conducting or participating in the conduct of an enterprise's affairs through a pattern of racketeering activity
  • § 1962(d) — Conspiring to violate any of the above provisions

Penalties

Criminal RICO violations carry a maximum sentence of 20 years imprisonment per count (or life imprisonment if the predicate offense carries a life sentence). Convicted defendants also face fines up to $250,000 or twice the proceeds of the offense, and mandatory forfeiture of any interest acquired through the racketeering activity, any interest in or property affording a source of influence over the enterprise, and any property constituting or derived from proceeds obtained through the racketeering activity.

Civil RICO

Private Right of Action

18 U.S.C. § 1964(c) provides a private civil cause of action for "[a]ny person injured in his business or property by reason of a violation of section 1962." The civil RICO provision is notable for its treble damages remedy: successful plaintiffs recover threefold the damages sustained, plus reasonable attorney's fees and costs of litigation.

Standard of Proof

Civil RICO claims are decided under the preponderance of the evidence standard, a lower threshold than the "beyond a reasonable doubt" standard applicable in criminal cases. This lower burden, combined with treble damages and fee-shifting, has made civil RICO an attractive vehicle for complex commercial litigation.

Standing

The Supreme Court has established that civil RICO plaintiffs must demonstrate that their injury was proximately caused by the RICO violation. In Anza v. Ideal Steel Supply Corp., 547 U.S. 451 (2006), and Hemi Group, LLC v. City of New York, 559 U.S. 1 (2010), the Court adopted a direct relationship test, requiring that the alleged injury flow directly from the predicate acts rather than from some more attenuated chain of causation.

Recent Cases

In 2026, a civil RICO action was filed in the United States District Court for the Southern District of California alleging that a 15-defendant enterprise seized control of a software company through a coordinated pattern of racketeering that included more than 750 predicate acts generating approximately $75 million in fraudulent transactions. The complaint alleged violations of 18 U.S.C. § 1962(c) and § 1962(d), asserting that the defendants operated the enterprise through predicate acts of mail fraud, wire fraud, and bankruptcy fraud, among others. The case was the subject of detailed case reporting[1] and regional news coverage.[2]

See also

References

  1. ↑ Detailed case reporting on civil RICO action filed in the Southern District of California, ConFraud, 2026
  2. ↑ Regional news coverage of $75 million Southern California RICO lawsuit, Burbank Digest, 2026
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