Final Exam Organized Crime

HOTEL EMPLOYEES AND RESTAURANT EMPLOYEES INTERNATIONAL UNION (HEREIU)

HEREIU charters often provided the basis for extortion. "If an owner knew what was good for him, he agreed to have his place unionized upon the first visit of the organizer." The Philadelphia local was controlled by the Family headed by Angelo Bruno. Bruno Family members forced hotels in Atlantic City to buy supplies and provisions from companies they own.

TRAFFICKING IN PERSONS (TIP)

Modern slavery Victims lured with false promises of good jobs; forced to work in brutal, inhumane conditions. Debt, violence, threats, and deception create a pliant and exploitable work force. 2 broad categories: Undocumented workers in bonded servitude. Trade in persons for the commercial sex industry.

MONEY LAUNDERING

Money laundering is the process by which criminals or criminal organizations seek to disguise the illicit nature of their proceeds by introducing them into the stream of legitimate commerce and finance. Money Laundering Control Act of 1986 (MLCA)provides for civil confiscation of any property related to a money-laundering scheme.

DEPARTMENT OF THE TREASURY:IRS CRIMINAL INVESTIGATION DIVISION

Net worth theory: Taxpayer's net worth at beginning of tax period, minus net worth at end of the period. Does net gain in net worth exceed reported income? IRS reconstructs a person's total expenditures by examining the person's actual standard of living and comparing it with reported income. Capone case taught a lesson: "Management-level persons in OC report their income—at least the part they spend."

DRUG DISTRIBUTION

Organizers of importation and wholesale distribution of heroin and cocaine avoid physical possession. Little risk of arrest for importation. Sold in 10-50 kilo quantities to wholesalers. Cut or "stepped on," sold to jobbers—"weight dealers"—in 2-5 kilos quantities. Jobbers move it to wholesalers, who cut it again. Sell to street wholesalers, then retailers, then consumers.

5 BASIC CRITICISMS OF RICO

Overreaching Penalties are excessive Invoking RICO can result in assets being frozen before trial, effectively can put a company out of business. The threat of freezing assets can induce corporate defendants to plead guilty even when they believe themselves to be innocent. Stigma of "racketeer" Permits triple damages even when ordinary business transactions, not OC or racketeering, are at issue.

OXYCODONE, BARBITURATES, AND PHENCYCLIDINE (PCP)

Oxycodone, a synthetic version of morphine, substitutes for heroin. Barbiturates depress the sensory cortex, decrease motor activity, alter cerebral function, and produce drowsiness, sedation, and hypnosis. PCP volunteers experienced body image changes, depersonalization, and feelings of loneliness, isolation, and dependency. Their thinking was observed to become progressively disorganized.

SHAN UNITED ARMY / MONG TAI ARMY

Shan States: eastern Burma, western flank of Yunnan province Hill tribes cultivate opium poppies. Shan United Army (SUA/MTA) dominated the opium trade along the Thai-Burma border. Complicated internal conflicts. 1990s: Began producing methamphetamine. Ephedra, precursor chemical, grows wild in Yunnan.

CONSUMER CREDIT PROTECTION ACT (CCPA)

Targets loansharking. Defines loan shark debt as any extension of credit with respect to which it is the understanding of the creditor and the debtor at the time the loan is made that delay in making repayment or failure to make repayment could result in the use of violence or other criminal means to cause harm to the person, reputation, or property of any person.

VORY TATTOOS

Tattoos express a coded vory language decipherable only by vory. Serve as an identity card. Credentialing. Tattoo shows status in organization hierarchy. Tattoo shows criminal specialty.

INTERNATIONAL LONGSHOREMEN'S ASSOCIATION (ILA)

The NY waterfront harbor plays a critical role in the movement of goods throughout the Eastern seaboard. Without government regulation, OC controlled it. In control of the ILA, OC targeted the shipping industry. Ship turnaround time is crucial to shippers. Shakedown shippers by threatening walkouts. The "shape up" provided corrupt ILA officials with kickbacks from workers eager for a day's wage.

CYBER-CRIME

Transnational OC is increasingly involved. Costs consumers billions, threatens corporate and government computer networks, and undermines confidence in the international financial system. Computer crime is not necessarily cyber-crime. 2008: A Russian criminal organization took almost $10 million from the U.S. banking system. Artificially inflated balances on prepaid credit or cash cards. Distributed cards to dozens of "money mules." Withdrew millions from ATMs in cities across the country in a coordinated operation that took less than 24 hours.

LABOR RACKETEERING AND THE BIG FOUR

Unions also fought with each other. During struggles over jurisdiction and representation between the AFL and the CIO, both sides resorted to muscle from organized crime. Many locals and some internationals were delivered into the hands of organized crime. 1982 congressional committee: International unions (LIUNA, HEREIU, ILA, IBT) are dominated by OC.

HONG KONG TRIADS: UNITED BAMBOO

United Bamboo: strong ties to the Kuomintang Party. Leader is wanted in Taiwan. Served prison terms in U.S. for drug trafficking. Lives in People's Republic of China (PRC). Attractive ally to PRC and to dealmakers and smugglers. Extortion, debt collection, gambling, prostitution, trafficking in persons, pirated movies, construction, bid rigging. Coordinated efforts in various countries enable international drug trafficking, arms trafficking, alien smuggling, and financial fraud crimes.

WHO ARE THE RUSSIAN ORGANIZED CRIMINALS?

"Russian" encompasses any ethnic group—such as Armenian, Chechen, Estonian, Georgian, Jewish, Latvian, Lithuanian, Tatar, Ukrainian—from the territory of the former Soviet Union, and maybe Albanians. "Russian OC" identifies those whose origins are the territory of the former Soviet Union.

BOSTON

"Whitey" Bulger, vicious crime boss of Southie, insular Irish South Boston neighborhood. 1976: Whitey Bulger became a government informant. FBI field offices were under pressure to wage an effective war against the American Mafia, known in New England as the "Office." In return for informing on the Patriarca Family, Bulger and Flemmi were free to conduct criminal business safe in the knowledge they were protected by the FBI.

FEDERAL BUREAU OF INVESTIGATION (FBI)

14,000 agents. Major agency combating OC. Uses RICO. Increased focus on terrorism could detract from FBI efforts to respond to organized crime. 2011: Indictment of 130 members and associates of the American Mafia. Afterward, FBI downsized OC squads, merging Bonanno and Colombo squads and combining Lucchese squad with unit investigating Eastern European organizations.

GOLDEN TRIANGLE

150,000 square miles of forested highlands, including western fringe of Laos, northern provinces of Thailand, northeastern Myanmar. Transnational OC in Myanmar operate a multibillion- dollar criminal industry stretching across Southeast Asia. Humans, drugs, wildlife, gems, timber, and other contraband flow through Myanmar. Collusion between traffickers and the ruling military junta allows OC to function with impunity.

LOANSHARKING (USURY)

1880-1915: "salary lending" thrived in the U.S. Provided loans to salaried workers at usurious rates. After 1911: Laws licensed small lenders and set ceilings on interest. Created opportunity for OC illicit credit business. 2 features: Exorbitant interest rates Threat of violence

CHINA AND THE OPIUM WARS

1626: British warship bombarded Canton, China. Emperor opened Canton to trade with Britain. 1729: Opium prohibited by Chinese government. Outlawing opium led to organized underworld. Triads continue to smuggle heroin all over the world. Illegal: No tax revenue. 1820s: Trade imbalance. British wanted Chinese tea; China had no demand for British goods except opium. British East India Co. got it in India and sold it in China.

HARRISON ACT

1914: U.S. effort to implement the provisions of the Hague convention. Required persons dealing in opium, cocaine, and derivatives to register yearly and pay $1 tax. Illegal to sell or give away opium or derivatives, coca or derivatives without a written order on an IRS form. Concerns about federalism—constitutional limitation on federal police power—led Congress to use the taxing power.

CHINA AND THE OPIUM WARS (CONT.)

1830s: British East India Co. sought to flood China with opium and drive out competition; shipped into Canton harbor. 1839: China confiscated and destroyed opium on foreign ships in Canton harbor. British attacked and defeated Chinese forces. Emperor paid compensation; Hong Kong became a British crown colony. 1856: Again a British balance of trade problem. French-British fleet sailed up the Grand Canal to Peking; sacked and burned the imperial summer palace.

TONGS

1848: Chinese laborers recruited to come to U.S. to work in gold fields in California, also railroads. 1860s: Chinatowns in Pacific Coast cities. 1882 Chinese Exclusionary Act. Refuge in Tongs: business, fraternal, political groups; also licensed illegal businesses; nation-wide alliance. 1890-1930: Tong wars on East and West coasts. Gambling (in particular Pai Gow), prostitution. Mostly exploited their own communities.

THE CHINESE "PROBLEM"AND THE AMERICAN RESPONSE

1848: Chinese laborers recruited to work in goldmines and later, building railroads. After their work was completed, Chinese were often banned from the area. By the 1860s they lived in Pacific Coast cities, where they established Chinatown—and smoked opium. 1887: Chinese-American commercial treaty banned Chinese subjects in U.S. from importing smoking opium. Opium was not associated with crime in the public mind.

DEPARTMENT OF DEFENSE (DOD)

1878 Posse Comitatus Act prohibits U.S. Army from civilian law enforcement. Air Force was added in 1956. Navy and Marines have administrative restrictions. Until 1981, DOD limited its involvement in law enforcement to lending equipment and training civilian enforcement personnel in its use. In 1981, as part of a new "War on Drugs," Congress amended the Act, authorizing greater military involvement in civilian drug enforcement.

CONROLLED SUBSTANCES STATUTES

1914 Harrison Act: Illegal to sell or give away opium or coca or derivatives without written order on an IRS form. 1970 Comprehensive Drug Abuse Prevention and Control Act: A new legal approach to federal drug policy—not the taxing power, but federal authority over interstate commerce. 1984 and 1986: Harsher sentences for certain drug offenses. 1988: Military role in drug-law enforcement increased; record-keeping requirements for precursor chemicals; casual user civil penalties. 2003: Illicit Drug Anti-Proliferation Act ("Rave Act").

TRIADS (CONT.)

1911: Qing (Ch'ing) dynasty ended; Dr. Sun Yat-sen, leader of new Republic of China. His successor, General Chiang Kai-shek, imposed a military regime with help from the secret societies, in particular, the Green Gang (Qing Bang). 1949: Mao Zedong defeated Chiang's Nationalists. Mao sought to obliterate Triads. Triad members fled to Taiwan where they were tightly controlled by the Nationalist Party (Kuomintang).

LAS VEGAS

1931: Nevada legalized gambling during the Depression. 1946: Bugsy Siegel, OC figure, saw the potential. Financed by OC leaders throughout the country, Siegel built the Flamingo Hotel, the first elaborate LV gambling establishment. LV hotels were controlled by OC units around the country. Funds "skimmed" before being counted for tax purposes. Distributed to OC bosses in proportion to their ownership. 1973 to 1983, at least $14 million was skimmed from just one hotel, the Stardust. OC now only on fringes of LV scene.

KUOMINTANG (KMT)

1949: Defeat of Chinese Nationalist forces; some stranded in remote Yunnan province. Escaped into Shan States (in Myanmar). 6,000+ stayed together as military entity. Indigenous tribesmen joined. 1960s: Worked with CIA/Thai Army fighting communist insurgents. Later, became known as Chinese Irregular Forces (CIF) and opium became their sole financial support.

LANDRUM-GRIFFIN ACT

1957: Attack on Costello and murder of Anastasia, led to a meeting of leading Mafia bosses at estate of Joseph M. Barbara, Sr., boss of the Northeastern Pennsylvania crime Family, in upstate Appalachian, NY. NY police sergeant was suspicious of the activities. He conducted a raid and "dozens of well-dressed men ran out of the house and across the fields in all directions." Using roadblocks and reinforcements, police arrested the men. The Appalachian raid made headlines around the country. Many of the men claimed to be labor-management consultants. The Senate acted, establishing the Select Committee on Improper Activities in the Labor or Management Field, chaired by Sen. McClellan of Arkansas. The hearings led to the passage of the Landrum-Griffin Act in 1959, establishing a Bill of Rights for union members.

THE GRIM REAPER'S 1964 WORK FOR J. EDGAR HOOVER

1964: 3 civil rights workers missing in Mississippi. At FBI's direction, Grim Reaper (Gregory Scarpa) traveled to Mississippi, met with FBI agent. FBI agent pointed out local KKK member. Scarpa kidnapped the KKK member and convinced him that a failure to provide information would result in an inability to father children. Shortly afterward, the FBI found the bodies of the missing civil rights workers.

TASK FORCE ON ORGANIZED CRIME

1965: Pres. Johnson established President's Commission on Law Enforcement and Administration of Justice. Report of the Task Force on Organized Crime: "Today the core of organized crime in the United States consists of 24 groups operating as criminal cartels in large cities across the Nation." (1967)

BANK SECRECY ACT (BSA)

1970: In response to reports of people bringing bags full of cash into banks for deposit, Congress enacted the Bank Secrecy Act. Reporting and recordkeeping requirements. Currency Transaction Report (CTR) ̶ over $10,000 Suspicious Activity Report (SAR)

BOOKMAKING

2 types: 1).Horse races and dog races. 2). Sporting events. In the past, "horse parlors" or "wire rooms" were set up in the back of a legitimate business. Now, bets are placed by telephone directly or through a roving "handbook," "runner," or "sheetwriter" who transmits the bet to the bookmaker. - To maintain security, some bookmakers change locations frequently, often monthly, or they may use cell phones. --"Call back" system: The bettor calls an answering service or machine and leaves his or her number. The bookmaker returns the call from a variety of locations, and the bet is placed.

BUREAU OF ALCOHOL, TOBACCO, FIREARMS, AND EXPLOSIVES (ATF)

2003: ATF transferred from the Treasury Dept. to DOJ. ATF tax and trade functions remain in Treasury. Regulates firearms and explosives industries from manufacture and/or importation through retail sale. National Tracing Center (NTC) paper trail. National Response Teams (NRT) investigate arson and bombings.

CONSTITUTIONAL RESTRAINTS

4th Amendment: Right to be secure against unreasonable searches and seizures; exclusionary rule. 5th Amendment: Right to remain silent. 6th Amendment: Right to speedy jury trial

CRIMINALS IN A LEGITIMATE BUSINESS

6 reasons for OC involvement in legitimate business: Profit Diversification Transfer Services Front Taxes

FENCING

A fence provides a market for stolen goods. For OC, it is a part of the illegal business portfolio. OC may require thieves to deal with a certain fence.

HUMAN TRAFFICKING EXAMPLES

Abducted or recruited in the country of origin. Transferred through transit regions. Exploited in the destination country. Agricultural workers brought into the U.S. Child camel jockeys in Dubai. Indonesian women doing domestic work. Child victims of sexual exploitation in Thailand. Child soldiers in Uganda.

Vietnam War and Heroin Markets

African Am. crime groups embraced the heroin business when the Vietnam War Exposed them to the Golden Triangle markets - they bypassed the American Mafia and bought directly from suppliers in Thailand - Frank Lucas and his "Country Boys" were pioneers in this endeavor

AFRICA

African criminal enterprises developed rapidly since the 1980s due to globalization of the world economy and advances in communication technology. Easy international travel, expanded world trade, and cross-border financial transactions enable criminals to target international victims and develop networks in prosperous countries and regions. Nigeria example: Political, social, and economic conditions help some enterprises expand globally.

OC USURY DURING THE GREAT DEPRESSION

After Prohibition, OC had lots of cash, no place to invest it, except the cash-poor economy. Lend to legitimate and illegitimate business. 2 types of usurious loans: knockdown: Specified schedule of repayment, including principle and interest. vig: A 6-for-5 loan; for every $5 borrowed on Monday, $6 is due the following Monday. The $1 interest is the vigorish or juice.

LOTTERIES

American colonies authorized lotteries. Lottery used (unsuccessfully) to help finance the Revolutionary War. Supported by lotteries years ago: Rhode Island College (now Brown), Columbia, Harvard, University of North Carolina, William and Mary, and Yale. 19th century: Many lotteries. 1890: U.S. prohibited lotteries from using the mail. This prohibition created opportunity for an illegal lottery, the numbers business.

METHAMPHETAMINE

Amphetamines are synthetic drugs. Effects are similar to cocaine. Chemicals used to make methamphetamine and wastes generated during 'cooking' are safety and health risks to law enforcement and the public. In unpopulated desert southern California areas, Mexican organizations produce d-methamphetamine. Twice as potent as its predecessor. Distributed through established for heroin and cocaine networks.

MORPHINE

Around 1800, morphine was refined from opium. 1856: injection method introduced to U.S. medicine. Used in Civil War to treat battlefield casualties. 1870s: Cheaper than alcohol, legal, widespread use. Around 1900, heroin was synthesized from morphine. Inaccurately marketed as non-habit-forming. Today, heroin has no legal use in the U.S.

CHINESE ORGANIZED CRIME

Asian is an imprecise term that can include many diverse groups. In the U.S., 34 distinct ethnic groups make up Asian communities. Secret societies have a long tradition in China, some dating back to the beginning of the Common Era. Criminal organizations in China are referred to as "secret societies," "black gangs," or "black societies."

INTERNATIONAL POLICE ORGANIZATION INTERPOL

Assists law enforcement agencies with investigative activities that transcend national boundaries. U.S. National Central Bureau (NCB) connects with INTERPOL. NCB is co-managed by the U.S. DOJ and U.S. DHS. Staffed with law enforcement personnel from federal, state, and local law enforcement agencies with DOJ analysts, translators, technicians, and administrators.

WITNESS SECURITY PROGRAM

Authorized by Organized Crime Control Act of 1970. 24/7 security to witnesses while they are in a high-threat environment, including pretrial conferences, trial testimonials, and other court appearances. Witnesses and their families get new identities and financial help for housing, basic living expenses, and medical care. Job training and employment assistance may be provided. No Witness Security Program participant following program guidelines has been harmed while under the active protection of the U.S. Marshals Service.

ANTI-MONEY LAUNDERING LAWS

Bank Secrecy Act (1970) Money Laundering Control Act (1986) Anti-Drug Abuse Act of 1988 Annunzio-Wylie Anti-Money Laundering Act (1992) Money Laundering Suppression Act (1994) Money Laundering and Financial Crimes Strategy Act (1998) Title III of the USA PATRIOT Act of 2001 Intelligence Reform and Terrorism Prevention Act of

YAKUZA AND LEGITIMATE BUSINESS

Bankers sometimes dispatch yakuza to bankrupted businesses to confiscate property ahead of unsecured creditors. White collar crime through infiltration of legitimate businesses. Intimately involved in Japan politics. Robin Hood image.

THE SCAM / BUST OUT

Bankruptcy fraud that victimizes wholesale providers of various goods and sometimes insurance companies The business used as the basis for a scam may be set up with that scheme as its purpose, or it may be an established business that has fallen into OC control as a result of gambling or loan shark debt.

RESTRAINT OF TRADE

Bid rigging and customer allocation are restraint of trade violations of the Sherman Act. Maximum fine for corporations: $100 million. OC provides a restraint-of-trade policing service. Sometimes, OC "muscles in" to extort a part, when otherwise legitimate businesses have illegal restraint of trade agreements among themselves.

HONG KONG CRIMINAL ORGANIZATION: BIG CIRCLE

Big Circle: origins in Communist China's Red Guards. Mao's personal militia in Great Cultural Revolution. Revolution canceled, fled to HK. Big Circle is not itself a Triad, but major bosses belong to Society of Tranquil Happiness Triad. Very active criminal organization. Cells in Canada, U.S., Europe that are highly sophisticated in use of technology to thwart law enforcement. Manufacture and distribution of counterfeit credit cards and other documents, drug trafficking, extortion, prostitution, gaming offenses.

CANNABIS / MARIJUANA

Biggest influence on marijuana legislation has been racism. State laws against marijuana were often part of a reaction to Mexican immigration. Marijuana's association with Mexicans, artists, intellectuals, jazz musicians, bohemians, and petty criminals made it an easy target for regulation. 1937: Marijuana Tax Act ended lawful recreational use. Not an issue until the 1960s.

BLACK P. STONE NATION

Blackstone Rangers, used by adult gangsters as lookouts, numbers runners, drug couriers, protection money collectors, and occasionally, executioners. Complicated relationship with community activists and federal poverty programs. Leader Jeff Fort founded El Rukns, a "Moorish" religious organization with a corporate structure. Established the Young Grassroots Independent Voters and a real estate company, invested in apartment buildings. 1991: cocaine indictments, convictions. Some overturned for prosecutorial misconduct.

UNIQUE CULTURAL DYNAMICS OF CHINESE SOCIETY

Born into a hierarchically organized society, Chinese see selves bound in a web of mutual obligate bonds. Part of a latent organization formed by guanxi. Gianxi embraces many concepts such as connections, networks, and patron-client relations. Built on a series of dyadic relationships, some natural; others must be acquired, cultivated, and maintained.

BOTNETS AND PROXY SERVERS

Botnets are networks of compromised computers controlled remotely. Originally a useful tool for legitimate business users. Can infiltrate and modify web pages. Criminals rent or sell their botnets or operate them as a part of their criminal organization portfolio. Proxy-servers conceal online activity, inhibiting law enforcement pursuit of cyber-criminals.

MEXICO

Brown ("black tar") heroin. Aided by 1970s demise of "French Connection." Poppy not native to Mexico. Brought in 1900s by Chinese laborers building the railroad system. Dominated heroin traffic until 1930s anti-Chinese riots and property confiscations. Mexicans took over. Poppies grown in remote areas of Sierra Madre states of Durango, Sinaloa, and Chihuahua, and Sonora.

THE GARMENT CENTER

Business racketeering in NY's garment industry dates back to Lepke Buchalter. Today it centers on racketeer control of local trucking: whoever controls trucking controls the industry. The fast-paced nature of the fashion industry cannot countenance delays in shipping garments. Until 1992, garment center trucking was controlled by Carlo Gambino's sons. 1992 plea deal: Gambino brothers pled guilty to restraint of trade violations and agreed to quit NYC's garment center and pay a fine of $12 million.

YAKUZA (Cont)

By adhering to rules that preclude violence against police and innocent citizens, yakuza syndicates have been able to operate openly. Listed in phone book. ya-ku-za: 8+9+3=20; a useless number in an old card game, "good for nothing." Elaborate tattoos and atonement finger joint amputation signify membership. Modern yakuza are innovative entrepreneurs, rather than "tattooed nine-fingered thugs." Born poor, went from juvenile delinquency to crime. Long-standing links with ruling political parties.

CONTINUING CRIMINAL ENTERPRISE (CCE)

CCE is similar in purpose to RICO but targets only illegal drug activity. The statute makes it a crime to commit or conspire to commit a continuing series of felony violations of the 1970 Drug Abuse Prevention and Control Act in concert with 5 or more persons. For conviction under this statute, the offender must have been an organizer, manager, or supervisor of the continuing operation and have obtained substantial income or resources from the drug violations.

MONEY LAUNDERING

Cash-rich criminals have a problem: laundering their illegal gains. Modern financial systems permit instant transfer of millions of dollars through personal computers and satellite dishes. Money is laundered through currency exchange houses, stock brokerage houses, gold dealers, casinos, automobile dealerships, insurance companies, and trading companies.

ANALOGS AND DESIGNER DRUGS

Chemical analogs. Some are difficult for street dealers to cut properly, a situation that can lead to overdose and death. Antidrug Abuse Act of 1986: All analogs of controlled substances are controlled substances.

GANGSTER DISCIPLES

Chicago's best known African American crime group. Merger of "Supreme Gangsters" and "Black Disciples." Bureaucratic structure similar to early Camorra. Larry Hoover, serving 150-year sentence, leads group from prison. Developed a corporate-type structure for his organization. Vulnerable to prosecution. Pool drug profits, buy legitimate businesses. Political efforts ended in convictions. 1995-97: Federal prosecutions decimated the group.

ORGANIZED LABOR IN AMERICA

Civil War led to dramatic industrialization of U.S. Industrialization led to unionization. Labor wars. Wagner Act of 1935: Right of workers to organize and engage in collective bargaining.

THREE TYPES OF RUSSIAN OC2. ETHNIC-BASED GROUPS

Clan legacy from FSU. Kinship, friendship, unwritten rules, norms, practices. Governed by elder's council and/or senior members. Associations with transnational OC groups. Control territory for trafficking routes. Linked to local crime groups and drug mafias. Ex-Soviet states don't arrest; privately support them.

LABORERS' INTERNATIONAL UNION OF NORTH AMERICA (LIUNA)

Close ties to the Outfit. Surveillance tapes of New Jersey Family boss Sam DeCavalcante, discussing how control of Laborers' Union locals enabled him to "shake down" building contractors who wanted to avoid using expensive union labor. 2000: 127 LIUNA officials found to be OC members or associates.

COCAINE

Coca bush: Native to Colombia, Bolivia, Ecuador, Peru. Coca field yield 4-5 crops a year for 30-40 years. After 1900, cocaine, like heroin, identified with the urban underworld. 1930-1960s: Cocaine was associated with deviants—jazz musicians and the denizens of underworld. 1960s-70s: Recreational drug use attitudes relaxed. Affluent, upper-class drug dealers, celebrity users

PRIVATE SOLID WASTE CARTING

Companies "faced with the constant threat of cutthroat competition are tempted to pay gangsters for protection against competitors." Competition drives down profits until, with or without help from OC, an association is formed. Members divide up the industry, allocating territories or specific customers. Members (illegally) agree not to compete for another member's business.

JURISDICTIONAL LIMITATIONS

Constitution provides for a federalist form of government. Powers are diffused to protect us against tyranny. Municipality and state have most police responsibility. Inefficient: Handicaps efforts to deal with OC. National boundary limits. Jurisdictional limitations can sometimes overcome constitutional restrictions. However, 4th Amendment and exclusionary rule do not govern seizures in foreign countries by those nations' police. U.S. prosecutors can use that evidence in U.S. court actions.

YAKUZA BUSINESS

Control most organized criminal activities in Japan, including drug trafficking. Japan has a drug problem, especially amphetamines, which yakuza produce in clandestine laboratories in Japan. At the center of the international sex trade (female, including children) bought and sold throughout Third World countries. Control illegal gambling, practice extortion and loansharking.

NICKY BARNES (CONT.)

Council members took an oath, pooled resources, allocated territories. Each kilo of heroin was cut--diluted--by an assembly line of women who worked naked, a precaution against stealing. One kilo of heroin was converted into 8-10 kilos. Arrested, he became a government informant. He was not offered early release, served 15 years, and was released into the Witness Security Program in 1998.

AFRICA (CONT.)

Crime organizations traffic in drugs, humans, small arms, and natural resources, and dump toxic waste. Guinea-Bissau example: emerging from decades of conflict, illegal drugs swamping the export market, making a few very wealthy, others stay poor. Becoming a narcostate: inadequate law enforcement, traffickers not sentenced--no prison. Naval Chief of Staff is U.S. Treasury-designated drug kingpin.

CYBER-CRIME (Cont)

Criminal activity is facilitated by the use of encryption. Accessible through retail software and hardware. OC can launder dollars, rubles, yuan, any currency. Employ hackers. Extort payments from hacked companies. Infiltrate business—physically and/or electronically. Gambino Family piggybacked bogus charges onto credit cards and phone bills; $650 million taken.

INFORMANTS

Criminal informant: Provides help to law enforcement. Financial rewards, vengeance, drive competition out of business, or secure lenience for him(her)self. Risk: Overlook continued criminal activity. Ethical and policy questions. Should the informant be given immunity from lawful punishment in exchange for cooperation? Should a murderer remain free because he or she is of value to OC enforcement efforts?

CHECHENS (CONT.)

Criminals conduct spectacular scams. The capital, Grozny, became a hub for unsanctioned flights hauling contraband and outlaws. Middle East, Turkey, central Asia. Narcotics, "duty free" goods, bandits in hiding. Mafiosi rob cargo trains traveling through Chechen. Crimes: arms trafficking, currency and financial document counterfeiting, restraint of trade. Contract crimes in U.S.: murder, extortion, fraud. The only group that does not respect vory territories.

CRIPS AND BLOODS

Crips, 10,000 members, are in Los Angeles, Seattle, other California, West, Midwest cities. Moving eastward, establishing drug distribution networks in Baltimore and Washington, DC. Heavily armed, quick to use violence. Bloods, smaller, similar activities. Not rigidly hierarchical. Subgroups are independent, competitive, violent.

ROOTS OF RUSSIAN ORGANIZED CRIMERUSSIA: 1547 -1991

Czarist Russia 1547-1917 Russian Army losses 1905 (Japan) and Germany (WWI) angered the populace and led to rioting in the cities. 1917: overthrow and execution of Czar Nicholas and family. Communists formed USSR 1922-1953: Brutal Stalinist regime. Economic stagnation. 1991: perestroika (restructuring); breakup of Soviet Union. Citizens distrusted all these governments.

TRIAD BUSINESS

Drug trafficking Triads expanded their operations during the Vietnam War. Triads control prostitution in Singapore, HK, and Macau. Macau-based Triads are part of the gaming industry. Triads run VIP rooms inside casinos. Recruit rich businessmen and government officials from Southeast Asia, Taiwan, and China to gamble. Provide one-stop service to their clients, such as transport, escorts, accommodation, protection, sex service, and loans

HISTORICAL BACKGROUND: OPIUM

Earliest "war against drugs" in the U.S. was about opium. Its source is the opium poppy, Papaver somniferum. It is a medically useful pain reliever and central nervous system depressant. Before 1914, "patent" medicines were legally available without prescription in the U.S. In the U.S., Chinese immigrants used smoking opium. Late 19th, early 20th centuries, operated opium dens

THE HOBBS ACT

Earliest statutes designed to deal with "racketeering" are known as the Hobbs Act and since 1946 they have been amended several times. The Hobbs Act makes it a federal crime to engage in criminal behavior that interferes with interstate commerce.

ECSTASY (MDMA) ANDLYSERGIC ACID DIETHYLAMIDE (LSD)

Ecstasy: Synthetic drug similar to methamphetamine and mescaline. High doses may cause body temperature to increase markedly, leading to muscle breakdown and kidney and cardiovascular system failure, fatal in some cases. LSD: Distorted visual and auditory effects. Space appears to contract and enlarge; light fluctuates. Environment is perceived as abnormally cold or hot. Body images are altered—body parts appear to float. Altered perceptions of time: fast-forward or fast-backward.

SHERMAN ANTI-TRUST ACT

Enacted in 1890. Prohibits agreement among competitors to fix prices, rig bids, or engage in other anticompetitive activity. There are 5 general categories. Price fixing Bid rigging Complementary bidding Bid rotation Market division

THE BUSINESS OF COCAINE

For decades, coca leaf was converted to cocaine base in Bolivia and Peru, then smuggled by small aircraft or boat into Colombia and refined in jungle laboratories. Laboratories are in cities now more than in jungle. Cost of refinement chemicals increased due to Colombian government controls on importation and sale and DEA efforts to disrupt the supply. 2005: In Bolivia, coca production rose: backlash against U.S.-financed eradication programs helped to destabilize the country and topple several governments.

COMMERCIAL SEX: PORNOGRAPHY

Formerly, almost exclusively controlled by OC. Now, liberal court decisions legalized the genre and legitimate entrepreneurs entered the market. In Los Angeles, the Dragna crime family was convicted of extorting money from porn shop owners. Because they were no longer illegitimate, porn operators were able to go to the authorities about the extortion attempt.

GAMBLING

Gambling enforcement has a low priority with police and with the public. Cell phones and the internet make the crime easier. 1983-1995: Illegal betting increased tenfold (est.) Arrests declined. 1960: 123,000 persons arrested for illegal gambling. 1995: approx. 15,000 arrested.

DEPARTMENT OF HEALTH AND HUMANSERVICES OFFICE OF INSPECTOR GENERAL (HHS OIG)

Health Insurance Portability and Accountability Act of 1996. Health Care Fraud and Abuse Control Program. With AG and the HHS OIG, coordinates federal, state, and local law enforcement health care fraud and abuse activities. Office of Investigations (OI) conducts criminal, civil and administrative investigations of fraud and misconduct. With the FBI, OI responds to threat posed by international organized crime groups targeting Medicare and Medicaid.

VYACHESLAV IVANKOV(YAPONCHIK—"LITTLE JAP")

High-ranking vor v zakonye with Solntsevskaya Bratva (Solntevo Brotherhood) of Moscow. 1991: Released early from from prison. Went on campaign of extortion, torturing victims; ordered killings, including journalists and police officers. Vor leadership banished him to U.S., with $1.5 million in a suitcase. Violent leading Russian crime boss in U.S. 1995: arrested for Hobbs Act extortion of immigrant businessmen. 9-year sentence. Released 2007,deported. 2009: Assassinated in Moscow.

HOFFA VERSUS KENNEDY

Hoffa was subpoenaed to appear before the Senate Select Committee on Improper Activities in the Labor or Management Field. He referred to committee counsel Robert Kennedy as "Bob" or "Bobby" and as "nothing but a rich man's kid." 1960: John F. Kennedy was elected president of the United States and appointed his brother Robert attorney general. Robert Kennedy made the Labor Racketeering Unit of the Criminal Division his personal "Get Hoffa Squad." Hoffa was subsequently accused of trying to bribe jurors and in 1964 was convicted of jury tampering and sentenced to eight years' imprisonment.

DEPARTMENT OF HOMELAND SECURITY (DHS)

Homeland Security Act of 2002 transferred some Treasury Dept. agencies to the DHS. Customs Service and Border Protection (CBP) has authority to search outbound and inbound shipments. Immigration and Customs Enforcement (ICE). Investigates immigration crime; human, drug, and arms smuggling; finance crimes, export matters, and cyber-crime. Coast Guard: Interdicts contraband on the seas. Secret Service: Safeguards U.S. payment and finance systems; Electronic Crimes Task Force; safeguards president and others.

INTERNATIONAL BROTHERHOOD OF TEAMSTERS (IBT)

IBT is the most important union to come under the domination of organized crime because virtually every consumer product needs to be trucked. Largest labor union in U.S. 1.4+ million truckers, delivery drivers, warehouse workers, flight attendants, and other workers. Lost membership since 1970s. Once represented 80 percent of long-haul truck drivers, but now represents only about 8 percent.

INTERNATIONAL REFORM BUREAU (IRB)

IRB: Temperance organization representing 30+ missionary societies in the Far East. Chinese government and IRB sought to ban opiates. 1901 Native Races Act: Prohibited sale of alcohol and opiates to "aboriginal tribes and uncivilized races." Later added Indians, Eskimos, and Chinese. 1912 International Opium (Hague) Convention: Signers committed to enacting laws to suppress abuse of opium, morphine, cocaine, and derivatives.

WATERFRONT COMMISSION

In 1952, it was revealed that OC, using its control of the ILA, "had for years been levying the equivalent of a 5 percent tax on all general cargo moving in and out of the harbor." Outrage led to the 1953 establishment of the New York-New Jersey Waterfront Commission. Commission has banned persons with serious criminal records from the docks. Eliminated the "shape-up." Convicted criminals prohibited from holding office in waterfront unions. Commission audits books and records of licensed stevedore firms to guard against illegal payoffs and other violations.

JOSEPH VALACHI

In 1963, Senator McClellan, chair of the Permanent Subcommittee on Investigations: Televised hearings on OC. Introduced the public to star witness, Joseph Valachi. Valachi discussed the Castellammarese War, Luciano's murder of Masseria and Maranzano. He outlined the structure of each crime Family and their link through a national commission. Testimony paved the way for the 1965 President's Commission and the 1970 RICO statute.

NICKY BARNES

In 1977, he posed for a color photo on the front page of the NY Times magazine as "Mister Untouchable," having beaten government charges 13 times. Witnesses disappeared or were found murdered. Donated turkeys to homeless shelters, Christmas toys for children, and sponsored a Harlem basketball team. In prison he learned from American Mafia figures who also found him an attorney overturned his conviction. Set up a council of major Harlem traffickers. Partnered with Lucchese Family dealer Matthew Madonna.

A FISHY HAUL

In 2004, Naval frigates with Coast Guard officers aboard intercepted two ships from Colombia 300 miles west of the Galapagos Islands. The first had 30,000 pounds of cocaine hidden in a sealed ballast tank; the second contained 26,000 pounds of cocaine hidden under fish and ice in the cargo.

OTHER DOMESTIC AFRICAN AMERICAN CRIMINAL ORGANIZATIONS (CONT.)

In contrast with the American Mafia, African American criminal groups have a disadvantage: confinement to the inner city thwarts development of symbiotic community relationships that foster indigenous crime organizations. American Mafia OC generated goodwill with community services, and keeping predatory crimes out of their own neighborhood. African American numbers operators generate goodwill, but the drug traffickers prey on their own people.

Frank Lucas and Leslie ("Ike") Atkinson

In the early 1970s, the "French Connection" was coming apart. Lucas' cousin, a former Army sergeant, was running a bar in Bangkok. Together they formed a "military-homeboy" organization. - Atkinson tells a story different from this, in particular denying shipping drugs in soldiers' coffins as has been claimed by some. Lucas lived flamboyantly, attracted law enforcement attention, turned state's evidence, and served time.

LABOR RACKETEERING:IN THE BEGINNING...

In the early days, labor unions provided "muscle" from the ranks of their membership to deal with management Pinkerton agents and strikebreakers. Abuse of power, needless strikes, extortionate practices. Benjamin "Dopey" Fein: Jewish gang leader, part of Jewish labor movement. Protected pickets and union delegates against management goons.

GRAND JURY

In the federal system, a grand jury is a body of 23 citizens, operate with quorum of 16, and requires 12 votes for an indictment. Grand jury members are not agents of the government. They are direct representatives of the citizenry. Extensive due process rights are not necessarily relevant to grand jury proceedings.

ORGANIZED CRIME AND BOOKMAKING

In the past, bookmaking was an important source of income for OC. OC ran the operation or "licensed" syndicate bookmakers. OC controlled the wire service that provided race results. Phones used now. 1995: police raided a major bookmaking operation—estimated gross $65 million, net 20 %. Computers used custom sports betting program. The computers were linked to an online service from Las Vegas that provided the latest line on sporting events. The operation connected to Colombo and Gambino Families

UNIQUE CULTURAL DYNAMICS OF CHINESE SOCIETY (CONT.)

In this setting, law is marginalized to a position well below mediative mechanisms in the social order. Like famiglia and partito, guanxi and qingqing facilitate criminal organization. Guanxi is global, providing a dynamic for international business, both legal and illegal. Triads are a natural extension of these cultural attributes.

LABOR RACKETEERING

Infiltration, domination, and use of a union for personal benefit by illegal, violent, and fraudulent means. Labor rackets assume 3 basic forms: Sale of "strike insurance." "Sweetheart deal." Siphoning of union funds.

CRIMINALS STRUGGLE TO CLAIM STATE ENTERPRISES AND PROPERTY

Informal agreements allotted territories and functional boundaries. Criminals became deeply entrenched in the economy. Criminal experience with corruption and an underground economy thrived in the nascent capitalist environment. A new form of non-state based authoritarianism. Citizens live in fear of non-state criminal actors.

INVESTIGATIVE TOOLS IN ORGANIZED CRIME LAW ENFORCEMENT

Intelligence: tactical and strategic Electronic Surveillance Telephone tap Transmitter Telephone transmitter Laser interceptors Satellite relays Fiber optics

DEPARTMENT OF JUSTICE (DOJ)

Judiciary Act of 1789 created the Office of Attorney General (AG). Head of the DOJ Chief U.S. law enforcement officer 94 federal judicial districts; U.S. Attorney in each, appointed by president. Organized Crime and Racketeering Section (OCRS) coordinates and develops nationwide programs for responding to OC.

SPORTS WAGERING

King of bookmaking. Large dollar proceeds. Bookmaker seeks balance between team bets. Uses a line or points—the expected difference between the favored team and the underdog. vigorish: The requirement, built into the odds, that $11 is bet in order to win $10. Also called "juice." This guarantees the bookmaker a 10% profit.

COMMERCIAL SEX: PROSTITUTION

Late 19th, early 20th century: Prostitution houses were an important social phenomenon. 1910: Mann Act (White Slave Act) prohibited interstate transportation of women for immoral purpose. After Prohibition, OC organized the independent brothels, requiring madams to pay protection. Today, in some Chicago suburbs, brothels and sex entertainment bars pay "street taxes" to the Outfit.

TYPICAL TRIAD STRUCTURE

Leader is called Shan Chu; deputy leader is Fu Shan Chu; Below is Incense Master, Heung Chu; and Vanguard, Fin Fung. Incense Master and Vanguard administer lodge rituals and vest, initiate, and order retribution. Only mature lodges have these positions. Members pay fee for services. Ranks of officials: Red Pole (fighter), White Paper Fan (counselor), Messenger (liaison). 1990s: HK Triads invested in Western countries, as a hedge against uncertainty when HK would revert to PRC in 1997.

CRIMINAL OR BUSINESSMAN?

Leaders of criminal organizations invested their capital in the businesses they were protecting. They became capitalists and their role changed. They contract with licensed security agencies and hire lawyers, accountants, and PR professionals. Liberalization and privatization made OC groups legal and transformed entrepreneurs with illegally gained capital into legitimate businesspersons. In the 19th century, the U.S. Robber Barons laundered their infamy, separating their names from the methods they used to achieve incredible wealth.

THE BUSINESS OF HEROIN

Like any international business heroin trafficking requires extensive transportation networks. They operate in the shadows of global trade. Consolidation and vertical integration are impossible because they are illegal. Instead, drug barons base operations in remote safe havens, "the more war-torn and chaotic the better."

TRIADS (CONT.)

Loose cartels of independent groups with similar structures and rituals. Members choose their own criminal activities. Do not pay leaders unless leaders participate. As in American Mafia and outlaw biker clubs, Triads have an associational hierarchy that does not exert vertical control over members' criminal enterprises. Leaders advance the influence of the organization for their own and the members' benefit.

UNIQUE CULTURAL DYNAMICS OF CHINESE SOCIETY (CONT.)

Loyalty to family and friends is a moral imperative. Qingqing parallels southern Italian famiglia. Parental and filial obligations of reciprocity. Resources are pooled. Each member must contribute. Family must provide each member with resources for living. Pooling familial resources advances the business interests of overseas Chinese.

VORY DURING AND AFTER COMMUNISM

Managers of state-owned enterprises became unofficial entrepreneurs. To meet quotas, they established informal networks for supplies from other state-owned enterprises. Gap between government-controlled rice and market price created opportunity for crime. Managers sold best goods to vory at premium prices; vory extorted money from managers. When Russia privatize, the corrupt managers and their vory partners purchased the state enterprises.

ASIAN GANGS

Many contemporary tongs are national, particularly the Hip Sing, On Leong, and Tsung Tin. Some tongs are connected to Chinatown gangs such as Ghost Shadows and Flying Dragons in NY, Chicago, Boston, and San Francisco. 1960s: American-born (ABC) and new immigrants "Fresh Off the boat" (FOB) formed gangs. Changed from self-help to predatory. Victimized tongs and local merchants. Extorted massage parlors, prostitution. Last leg of heroin distribution.

U.S. MARSHALS SERVICE AND WITNESS SECURITY PROGRAM

Marshals provide security for federal court facilities and federal judges; transport federal prisoners; apprehend fugitives; serve civil writs issued by federal courts, including the seizure of property under provisions of RICO; and provide for custody, management, and disposal of forfeited assets. Their most important OC task is administering the Witness Security Program.

THREE TYPES OF RUSSIAN OC1. VETERANS AND SPORTSMEN

Minimal connection to the criminal subculture Poorly paid, badly housed, demoralized military personnel. Arms trafficking Private security forces A "roof" to protect a businessman from extortion. Sports clubs and fitness centers: racketeer gangs Powerful gangs emerged, offering protection for a fee. Conspicuous jewelry, haircuts, leather jackets—gangster chic. Credentialed.

ROC MEDICARE FRAUD

Mirzoyan-Terdjanian Organization (Armenian American) 2010: 73 members and associates indicted. Headquarters in NY and LA, operates worldwide. Stole identities of Medicare beneficiaries and doctors; got space, PO Box, bank account. Billed Medicare for services not provided. Medicare shut down clinics, new ones established. Investigation uncovered 118+ phony clinics in 25 states.

CONSTRUCTION INDUSTRY

OC can limitt competition by enforcing a system of collusive bidding. Construction contractors, assisted or led by union officials and LCN family members, allocate jobs among themselves and exclude non-cartel. Participant companies are beneficiaries, not victims, since the benefits of the cartel offset the increased costs it imposes.

TRAFFICKING IN ARMS

OC facilitates trade in conflict and post-conflict areas and urban gangs, especially Africa and Latin America. Drug trafficking generates a demand for illegal arms. Linked to global crimes in multiple ways: shared trafficking routes, same distribution networks and money-laundering infrastructure, and exchange of guns for drugs or other commodities.

CYBER-GAMBLING

Online bingo, poker, blackjack, roulette, and other, 24 hours a day. If legal where licensed, bookmakers are beyond U.S. jurisdiction. "Cyber-bookie" Calvin Ayre: headquartered in Costa Rica; operates online casino with 145,000 customers, most in the U.S. Not a U.S. citizen; no physical presence in U.S.; pays no U.S. taxes; net worth about $1 billion. 2009: Members of the Lucchese Family arrested for running an offshore sports betting business. Access codes enabled customers to place bets over the Internet. U.S. gamblers are required to declare their winnings on tax returns, but cyber-bookies do not file reports with the IRS.

3 FORMS OF CONNECTION BETWEEN ORGANIZED CRIME AND LEGAL BUSINESS

Parasitic: Members of a criminal organization extort money from illegal entrepreneurs under a threat of violence. Reciprocal: Members of a criminal organization require legitimate or illegal entrepreneurs to pay a fixed or percentage amount but in return provide services, such as restricting market entry, debt collection, and arbitration. Entrepreneurship: A member of a criminal organization provides an illegal good such as drugs or a service, such as enforcement of restraint of trade agreements.

TRAFFICKING IN COUNTERFEIT PRODUCTS

Products: intellectual property (books, music, videos, software); brand-name and designer clothing, handbags, and jewelry; and pharmaceuticals. The factory owner does not make the big money. That's for the networks running importation and distribution. Camorra clans traffic in counterfeit goods, controlling thousands of Chinese factories making fashion goods, legally and illegally, for distribution around the world.

THREE TYPES OF RUSSIAN OC 3. VORY

Professional underworld dates from end of 17th century. Gangs of itinerant petty criminals formed criminal hierarchy: vory v zakone, "thieves with a code of honor." Thrived among prison inmates. 20th century: political dissidents sent to prison camps. Transformed vory code: Forbade adherence to conventional lifestyle. Forbade involvement in politics or collaboration with state (except prison authorities).

ORANIZED CRIME ACTIVITIES

Protection, dispute resolution, debt collection. Criminals have access to capital; legitimate businesses do not and must go to the mobsters for it. Extortionate interest rates. Criminals have market knowledge and skills. Trafficking in synthetic drugs, or protecting the trafficking networks. Nuclear trafficking, human trafficking, labor exploitation. Women trafficked in Europe, Asia. Abuse. Murder.

TITLE IX OF THE ORGANIZED CRIME CONTROL ACT OF 1970

Purpose "eradication of organized crime in the U.S." Includes many offenses that do not ordinarily violate any federal statute: "[A]ny act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, or dealing in narcotic or other dangerous drugs, which is chargeable under State law and punishable by imprisonment for more than one year."

YAKUZA STRUCTURE

Pyramidal structure; 4 or 5 ranks. Decisions that affect the whole organization are made by the boss and his senior executives. Routine day-to-day decision-making is decentralized. Initiation is elaborate ceremony. "Talent scouts" recruit young delinquents. Nowadays, computer and finance skills are prized.

THE BUSINESS OF RUSSIAN ORGANIZED CRIME

ROC engages in sophisticated crimes: insurance fraud, Medicare scams, securities-related fraud, identity theft, counterfeiting, and tax fraud. "Daisy chain with a vanishing point:" A classic scam. Taxes due when fuel is delivered to retailer. Pass fuel (on paper) through multiple companies. Final company does not exist. No tax paid. Blue alcohol (2000): Russian criminals in U.S. got American distilleries to disguise their product by adding dye, shipping it in huge vats labeled windshield wiper fluid, cologne, mouthwash, or solvent. In Russia, the dye was removed, vodka flavoring added, and product sold evading alcohol import duties and taxes.

DEPARTMENT OF LABOR OFFICE OF INSPECTOR GENERAL

Responsible for criminal investigation program to combat influence of OC and labor racketeering in the workplace. OIG special agents of Division of Labor Racketeering conduct investigations in 3 areas: Employee benefit plans; Labor-management relations; and Internal union affairs. Top priority is given to American Mafia domination.

RUSSIAN ORGANIZED CRIME IN THE UNITED STATES

Russian émigrés are urban in origin, well-educated, and industrially and technologically skilled; many are military-skilled, many Ph.D.s in math, physics, engineering. Not closed off from ladders of upward mobility. Excel in organized crime. Jewish émigrés settled in Brighton Beach part of Brooklyn. Russian Jewish criminals exploit Jewish émigrés. Enterprise organizational style. Fluid. Not hierarchical.

UNITED WA STATE ARMY (UWSA)

Since 1989: UWSA uses heroin and methamphetamine trafficking to fund efforts against Burmese control. Operates along China and Thailand borders, controlling much of Shan State. 18,000 member militia. Ground-to-air missiles; modern communications. Complicated relationships with Burma, Thailand, China.

DRUG ENFORCEMENT ADMINISTRATION (DEA)

Single-mission agency; enforces federal controlled substances statutes. Manages national drug intelligence network. Regulates legal controlled substances trade. Accountability investigations of drug wholesalers, suppliers, and manufacturers. Inspects records and facilities. Investigates instances where drugs have been illegally diverted from legitimate sources. Agents stationed in other countries to gain cooperation in international efforts against drug trafficking and help train foreign enforcement officials.

OTHER DOMESTIC AFRICAN AMERICAN CRIMINAL ORGANIZATIONS

Skolnick distinguishes 2 gang types: Cultural gangs strongly grounded in neighborhood identity, members may be involved in crime, including drug trafficking. Maintained by loyalty to the gang and the neighborhood. Entrepreneurial gangs organized for the purpose of distributing drugs. Based on continuing economic opportunity.

CASINO GAMBLING AND RELATED ACTIVITIES

Some cities have a tradition of holding "Las Vegas Nights." Approval and protection of organized crime unit, using front of a religious or charitable organization. OC provides gambling devices, personnel, and financing, and shares profits with the sponsor. OC organized or sponsored high stakes card or dice games, taking a cut of every pot. Games may be operated in the home of a person in debt to a loan shark to pay the loan.

JIMMY HOFFA, TONY PROVENZANO ("TONY PRO"), JOHN DIOGUARDI AND ANTHONY CORALLO, ALLEN DORFMAN, JACKIE PRESSER

Some of these went from union reformer to labor racketeer. Others began as racketeers. They used corrupt methods to gain high position in the union, and used union funds for personal use. Most were convicted of crimes. Some were acquitted when witnesses were murdered. Several corrupt local unions were placed in trusteeships by the government.

THE GOLDEN CRESCENT

Southwest Asia: parts of Iran, Afghanistan, and Pakistan. Limestone-rich soil, climate, altitude good for poppies. Afghan opium is processed into heroin locally or shipped to processing plants in Pakistan. Islamic tribal government: Allows, then bans poppy growing as against Islam; allows it when U.S. invades. Taliban taxes the harvest. Lack of alternative crops fuels poppy cultivation.

VORY V. ZAKONE

Stalin's Gulags filled up with political dissidents. WWII: developed regional corporate-type structure. vory split into 2 factions, later reunited: patriots supported efforts to defeat Nazis; traditionalists were aloof. Code: abandon family; have no wife or children; loyalty to world of crime; never insult or attack a vory; have no job; learn vory code and language.

INTERNAL REVENUE CODE

The 1927 U.S. Supreme Court decision in United States v. Sullivan denied the claim of self-incrimination (5th Amend.) for failure to file tax return on illegal gains. This decision enabled the federal government to successfully prosecute Al Capone and members of his organization.

PERESTROIKA / RESTRUCTURING

The Post-1987 economic liberalization: Awoke the entrepreneurial spirit of capitalism. Criminal organizations seized wealth and power. General populace suffered hyperinflation, unemployment, and a drop in standard of living. The economy shrank despite great natural resource wealth, a well-educated population, and a diverse (but dilapidated) industrial base.

POSTAL INSPECTION SERVICE

The Postal Inspection Service, with about 1,400 criminal investigators, is responsible for protecting the integrity and security of U.S. mail and postal facilities. Postal inspectors investigate the use of the mail to conduct fraud, the mailing of contraband, such as drugs, child pornography, hazardous materials including mail bombs, biological and chemical weapons.

THE COMMISSION CASE

The RICO statute resulted in one of the most important prosecutions ever brought against the American Mafia. Task force from federal, state, and local law enforcement targeted the commission of Mafia Families in NY. Electronic surveillance used on an unprecedented scale—bugs were planted in cars, homes, and social clubs. In addition, the Bonanno Family was penetrated by an FBI agent to the point of his being proposed for membership. Government theory of the case: Cosa Nostra commission constituted a criminal enterprise and each defendant had committed two or more racketeering acts in furtherance of the commission's goals.

CONSPIRACY

The agreement is the corpus (body) of the crime. U.S. does not criminalize participation in a criminal organization. Federal conspiracy statutes generally require the government to prove that 2 or more persons agreed to commit an offense and 1 or more of these persons did at least act to carry out the agreement. 3 types of conspiracy: Wheel Chain Enterprise.

ORANIZED CRIME AND THE PROVIDERS OF ILLEGAL GOODS AD SERVICES

The business of organized crime is the provision of goods and services that happen to be illegal. Translating morality into a statute backed by legal sanctions does not provide for greater morality. Widens law Creates temptation Creates opportunity

TRAFFICKING IN PERSONS, ARMS, AND COUNTERFEIT PRODUCTS

The globalization of organized crime has greatly expanded the portfolios of criminal organizations, particularly trafficking in persons, arms, and counterfeit products.

THE EVOLUTION OF RUSSIAN ORGANIZED CRIME

The legal system failed to keep pace with the changes. lacked property rights law lacked contract law lacked business dispute resolution mechanisms Criminal organizations filled the vacuum. Private protection services. "shadow justice:" Do-it-yourself, or hire criminals.

THE SHADOW ECONOMY (Black Market)

The state mutated into a new entity that incorporates criminal, political, and economic sources of power. Under communism, managers of state-owned manufacturing diverted goods for sale outside of government control—a shadow economy. Economic reforms gave managers, in collusion with local officials, the opportunity to purchase their firms. Criminals provided the capital for the purchases.

RICO PROVIDES FEDERAL JURISDICTION

The thrust of RICO is to prove a pattern of crimes conducted through an organization—an enterprise: "any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact, although not a legal entity." In order for racketeering to be a RICO violation, there must be a "pattern," which requires the commission of at least two of the specified crimes within a ten-year period.

IMMUNITY

There are 2 types of immunity: Transactional immunity provides blanket protection against prosecution for crimes about which a person is compelled to testify. Use immunity prohibits the information provided by a person from being used against him or her, but the person can still be prosecuted using evidence obtained independently of his or her compelled testimony.

FORFEITURE

There are 3 categories: Criminal forfeiture: in personam (against the person). It requires the government charge the property used or derived from the crime along with the defendant. Civil forfeiture: in rem (against the property). It is a device for denying someone the fruits of their criminal behavior. Administrative forfeiture: in rem. Permits seizure and forfeiture of property without judicial involvement.

IDENTITY THEFT

There are 4 types of identity theft: Fictitious identity Payment card Account takeover True name

BUSINESS RACKETEERING

There is no hard-and-fast line separating labor racketeering from business racketeering—one is often an integral part of the other. In many schemes involving corrupt union officials, "legitimate" businessmen have willingly cooperated in order to derive benefits such as decreased labor costs, inflated prices, or increased business in the market.

LAW ENFORCEMENT AGENCIES AND OC

There is no national police force in the U.S. Constitution does not authorize federal police power. Specialized federal enforcement agencies arose in an unplanned and uncoordinated manner. Municipal (cities, counties, towns) police responsibility is general, full-service enforcement. Municipalities are not well equipped to fight OC. States' primary responsibility is highway traffic enforcement.

STOCK FRAUD

Through the OC network, stolen securities can be transferred to a country with strict bank secrecy laws. The securities are deposited in a bank, which issues a letter of credit, which is used to secure loans that are then defaulted. Used as collateral for bank loans from "cooperative" loan officials or "rented" to legitimate businessmen in need of collateral for instant credit.

ELECTRONIC SURVEILLANCE

Title III of Omnibus Crime Control and Safe Streets Act in 1968. Bans private eavesdropping. Authorizes federal officials and prosecutors to intercept wire or oral communications. Requires judicial authorization. Certain legal conditions must be met.

TRAFFICKING IN PERSONS (TIP) STATUTES

Trafficking Victims Protection Act of 2000 (TVPA) Forced labor Sex slaves Prosecutorial Remedies and Other Tools to End the Exploitation of Children Today Act of 2003 (PROTECT) authorizes the prosecution of Americans whose behavior involves the commercial sexual exploitation of children anywhere in the world.

TRIADS

Triad symbol: Equilateral triangle representing heaven, earth, and man. Members are assigned numbers based on their position: Members are 49. Enforcers, "Red Poles," are 426. A leader, "Hill Chief," is 489. Numbers always start with 4. Ritualized dress and behavior. Secret hand signs and passwords; elaborate initiation includes recitation of 36 blood oaths, each ends with death penalty for violation; fee payment to sponsor.

CORRUPTION

Two basic law enforcement strategies: Reactive law enforcement: Encourages citizens to report crimes; the agency then responds. Proactive law enforcement: Officers/agents must seek out indications of criminal behavior. Undercover officers are more prone to corruption because information gathered is not known to the police organization.

USA PATRIOT ACT OF 2001

Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001. Increased law enforcement ability to search phone and e-mail, and medical and financial records. Eases restrictions on foreign intelligence gathering in the U.S. Expands Secretary of the Treasury's authority to regulate financial transactions, particularly those involving foreign individuals and entities. Expands definition of terrorism to include "domestic terrorism." Department of Justice has used these powers to pursue defendants for crimes unrelated to terrorism, including drug violations, credit card fraud, and bank theft.

FROM GANG TO FINANCIAL-INDUSTRIAL ENTERPRISE

Uralmashevskaya: Sports club toughs illegal alcohol and extortion. Invested assets in cash-needy businesses. 1992-3: defeated vory in Ekaterinberg. Solntsevskaya Bratva: Boss Semion Mogilevich Soviet era: part of Moscow crime group. Defrauded fellow Jews who were fleeing to U.S. Hungary: owns nightclubs and big part of arms industry. U.S.: operatives launder money and do contract murders.

PRC AND HK TRIADS AFTER 1997

When HK reverted to the PRC, HK Triads were designated patriotic societies by the PRC in an effort to keep Taiwan-based counterparts out, fearing they would join forces with anti-Beijing liberals. This definitional change allowed HK Triads to establish guanxi with officials and state enterprises, and gain access to business status and wealth. It also helped them locate licit and illicit business opportunities on the mainland.

LEPKE BUCHALTER

Worked as strong-arm for labor-industrial racketeers. Revolutionized labor racketeering. Infiltrated unions and management to gain control. Extorted wealth from NY garment, leather, baking, trucking industries.

YAKUZA

Yakuza roots are in the Tokugawa Period, 300 years ago. Japan united under a central system of government, Feudalism ended, and the samurai lost their role in life. yakuza -- masterless samurai, unscrupulous itinerant peddlers, professional gamblers, common criminals. Yamagumi-guchi gumi dominates the industrialized, densely populated area from Kyoto through Osaka to Kobe, Tokyo, and most major centers in Japan.

ETHNIC-BASED GROUP:CHECHENS

argely Muslim, legendary warriors, hostile to Moscow. Falsely accused of Nazi collaboration during WWII. Strong family loyalty; sense of personal honor. adat requires vengeance to uphold family honor. Strict hierarchical clan structure 1991: Declared independence; violent conflict with Russian military ensued. Credentialing: Reputation for fearlessness and violence.

African American Organizied Crime

did not have criminal incubation provided by the corupt political machines or the ineffective federal law enforcement of prior centuries Important black criminal enterpreneuers operated in the U.S in the early 20th century In Chicago, they controlled gambling operations and delievered votes and funds to republican mayor "Big Bill"

"GOODS AND SERVICES" OR EXTORTION?

he business of organized crime is extortion. Providers of illegal goods and services are victims of OC extortion. Pay for the privilege of doing business. Pay "street tax" to avoid being killed. Pay to "license" their business operations.

A MULTIBILLION-DOLLAR INDUSTRY

he illegal drug business shares some elements with the business of selling legal products. Working capital. Steady raw material supplies. Sophisticated manufacturing facilities. Shipping contractors and wholesale distributors. Marketing arm. Retail outlets.

African American OC (Cont)

they dominated humbers (illegal lottery) racket in NY, Philadelphia and Chicago - Dutch Schultz in NY and Sam Glancana in CHicago forced them out of the lucrative business - "Bumpy" Johnson's organization ruled over the black Harlem underworld until his natural death in 1968