WEBVTT - How Does Racketeering Work?

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<v Speaker 1>Welcome to brain Stuff, a production of I Heart Radio,

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<v Speaker 1>Hey brain Stuff. Lauren Vogelbaum here. In a pivotal scene

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<v Speaker 1>in the movie The Godfather, the aging mafia kingpin Vita

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<v Speaker 1>cor Leone played by Marlon Brando, calls a meeting of

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<v Speaker 1>prominent mafio so from across the United States to strike

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<v Speaker 1>a pact the drugs for the new game in town,

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<v Speaker 1>and cor Leone, hesitant at first about entering the narcotics business,

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<v Speaker 1>proposes that the competing mob operations work together to control

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<v Speaker 1>the drug trade nationwide. The Godfather is fiction, but that

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<v Speaker 1>scene is reminiscent of real world criminal conspiracies hatched by

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<v Speaker 1>mob bosses like John the Teflon, Don Gotti and Anthony

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<v Speaker 1>Tony Duck's Corralo. These types of backroom deals were the

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<v Speaker 1>bread and butter of the mob business model for decades.

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<v Speaker 1>The cops and FBI might nab some lower level operatives

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<v Speaker 1>for murder, bribery, or extortion, but the bosses at the

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<v Speaker 1>top were able to keep their hands clean. Gatty's business

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<v Speaker 1>card said he was a salesman for a plumbing contractor,

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<v Speaker 1>and since prosecutors couldn't connect him or other mafia dons,

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<v Speaker 1>directly to specific crimes. The biggest criminals were seemingly untouchable.

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<v Speaker 1>Then came the RICO Act of nineteen seventy, otherwise known

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<v Speaker 1>as the Racketeer, Influenced and Corrupt Organizations Act. RICO gave

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<v Speaker 1>the fed's new power to indict mob kingpins for various

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<v Speaker 1>rackets or crimes committed by their underlings. Before the article

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<v Speaker 1>this episode is based on House to Works. Spoke with

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<v Speaker 1>Jeffrey Grell, an attorney and adjunct professor at the University

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<v Speaker 1>of Minnesota Law School who specializes in RICO law. He

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<v Speaker 1>said the philosophy behind RICO was to get the Vita

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<v Speaker 1>cor Leones of the world. RICO goes into that conference

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<v Speaker 1>room where you've got a bunch of people who never

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<v Speaker 1>get their hands sturdy, who aren't out dealing drugs, murdering people,

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<v Speaker 1>or engaging in any criminal activity directly. Those are the

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<v Speaker 1>people that RICO is designed to get, the people who

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<v Speaker 1>engage others to engage in rack tearing. A racket is

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<v Speaker 1>any organized criminal scheme like, for example, the twentieth century

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<v Speaker 1>mob rackets of prostitution, gambling, illegal lotteries run running during Prohibition,

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<v Speaker 1>and the protection racket in which the mob offers businesses

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<v Speaker 1>paid protection from criminal gangs, notably themselves, But as defined

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<v Speaker 1>by RICO, racketeering is whenever an individual operates or manages

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<v Speaker 1>an enterprise through a pattern or series of racketeering activities.

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<v Speaker 1>The alleged racketeer does not have to commit any of

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<v Speaker 1>the crimes themselves or even know about the crimes, which

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<v Speaker 1>can include everything from kidnapping to wire fraud to biological weapons.

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<v Speaker 1>A Contrary to popular belief, RICO cases aren't easier to

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<v Speaker 1>prosecute than regular criminal cases, and Hollywood depictions often get

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<v Speaker 1>it wrong, though Grell said that the RICO episode of

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<v Speaker 1>Better Call Saul pretty much nailed it. Although the language

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<v Speaker 1>of RICO is broad, the Supreme Court and federal appeal,

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<v Speaker 1>those courts have narrowed its application. As a consequence, the U.

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<v Speaker 1>S Department of Justice very rarely pursues racketeering charges. Grell

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<v Speaker 1>said that most of the time, people who commit crimes

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<v Speaker 1>are out there committing the crimes. They're dealing drugs, they're

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<v Speaker 1>murdering people. Why would the Feds use RICO when they

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<v Speaker 1>can just charge them with the underlying crime. The DJ

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<v Speaker 1>only uses RICO when there's really no other alternative, like

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<v Speaker 1>with John Gotti. To make a racketeering charge stick, you

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<v Speaker 1>first need to prove that a pattern of related criminal

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<v Speaker 1>activity took place, whether it was murder, extortion, drug dealing,

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<v Speaker 1>or some other racket. Again, you don't have to prove

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<v Speaker 1>that Gouty himself pulled the trigger or ordered the hit,

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<v Speaker 1>but that someone in the enterprise did the second, and

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<v Speaker 1>most importantly, you need to prove that Gotti or any

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<v Speaker 1>other alleged racketeer operated or managed the enterprise. Grell points

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<v Speaker 1>out that under RICO law, the enterprise or organization itself

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<v Speaker 1>isn't on trial for racketeering, but rather the individuals in charge,

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<v Speaker 1>defined as those who quote exercise discretionary authority on behalf

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<v Speaker 1>of the enterprise. If an individual associated with an enterprise

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<v Speaker 1>simply follows orders and exercises no discretion in carrying out

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<v Speaker 1>their duties, most courts agree that such low level associates

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<v Speaker 1>cannot be held liable under RICO, but there are also

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<v Speaker 1>civil Rico suits. The original Rico Act contained a provision

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<v Speaker 1>allowing civil lawsuits in which plaintiffs could collect triple damages

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<v Speaker 1>if they were injured by a RICO violation. In the

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<v Speaker 1>nineteen eighties that led to a wave of civil reco claims,

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<v Speaker 1>some of which had flimsy legal rounding. This led to

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<v Speaker 1>tighter restrictions on civil rico suits, including a four year

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<v Speaker 1>statute of limitations. In recent years, some of the biggest

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<v Speaker 1>scandals in the news cycle have also been the subject

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<v Speaker 1>of civil racketeering lawsuits, including the Catholic Church sexual abuse

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<v Speaker 1>scandal and the Harvey Weinstein sexual harassment scandal. In that example,

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<v Speaker 1>in addition into filing individual sexual harassment lawsuits against this

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<v Speaker 1>media mogul, lawyers for the victims have also filed a

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<v Speaker 1>civil reco case allegingd that Weinstein and his enablers operated

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<v Speaker 1>a criminal organization that the lawyers are referring to as

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<v Speaker 1>the Weinstein Sexual Enterprise. If the allegation sticks, then Weinstein

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<v Speaker 1>and his associates could owe triple damages to their victims

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<v Speaker 1>under civil racketeering law. Here are a few more traditional

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<v Speaker 1>rico suits from recent years. In there was the Atlanta

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<v Speaker 1>cheating scandal. Eleven teachers and administrators from Atlanta, Georgia's schools

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<v Speaker 1>were convicted of racketeering, and not because they were ordering

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<v Speaker 1>hits on the lunch lady or running a speakeasy in

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<v Speaker 1>the faculty lounge, but because they had conspired to cheat

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<v Speaker 1>on their students standardized tests, and schools that performed better

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<v Speaker 1>on the tests got more money from the government. So

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<v Speaker 1>these ringleaders created a system that rewarded teachers for correcting

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<v Speaker 1>their students answers and punished those who refused to play ball.

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<v Speaker 1>That same year, the soccer world was rocked by the

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<v Speaker 1>indictment of nine prominent officials from FIFA, the sports international

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<v Speaker 1>governing body, on racketeering charges. The Department of Justice alleged

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<v Speaker 1>that since nineteen ninety one, the men had run a

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<v Speaker 1>kick back scheme. The used bribery to secure the rights

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<v Speaker 1>to certain FIFA events, including the World Cup. As of

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<v Speaker 1>this writing, only two of the accused have been convicted

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<v Speaker 1>of criminal racketeering conspiracy, a charge the caries of to

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<v Speaker 1>twenty years in prison. Then there's the opioid crisis. You

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<v Speaker 1>may know that a number of pharmaceutical companies have been

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<v Speaker 1>targeted for their role in worsening the deadly opioid epidemic

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<v Speaker 1>in the US, but five executives at Insist Therapeutics were

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<v Speaker 1>convicted of engineering a scheme to bribe doctors to prescribe

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<v Speaker 1>their fentinel based mouth spray even when it wasn't medically necessary.

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<v Speaker 1>The charge was racketeering because the executives didn't pay the

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<v Speaker 1>bribes themselves, but helped organize phony speaker programs in which

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<v Speaker 1>doctors were recruited and paid off. Grel said, rico is

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<v Speaker 1>a good tool when you're working with large groups, like

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<v Speaker 1>a drug dealing enterprise or corporation. If you substitute that

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<v Speaker 1>room full of mafioso's with the board of directors for

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<v Speaker 1>any corporation, it's the same thing. Today's episode is based

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<v Speaker 1>on the article Racketeering Isn't just a crime for mobsters

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<v Speaker 1>on how stuff works dot Com, written by Dave Rouges.

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<v Speaker 1>Brain Stuff is production of I Heart Radio in partnership

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<v Speaker 1>with how stuff works dot Com, and it is produced

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<v Speaker 1>by Tyler Clang. Four more podcasts my heart Radio, visit

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