ORGANIZED CRIME

Organized crime is the illegal activity of people and organizations whose acknowledged purpose is profit through illegitimate business enterprise.  Organized crime involves marketing techniques (threat, extortion, smuggling) and products (drugs, sex, gambling, loan-sharking, pornography) that have been outlawed.  The system resembles an legitimate business enterprise, and may even have a corporate executive structure, a staff of assistants, and accountants, but it’s far from legitimate because the business was set up by force, intimidation or threat.  The members of a criminal organization are really gangsters, professional criminals who are trying to live the life and mystique glamorized by legendary figures — Al Capone, Meyer Lansky, Lucky Luciano.  Their underworld system survives by pretending to be legitimate business or by infiltrating (through immunity and protection rackets) legitimate business.  The following table summarizes:
Legitimate business:

Food products
Real estate
Restaurants
Garbage disposal
Produce
Garment manufacturing
Bars and taverns
Waterfront
Securities
Labor unions
Vending machines
Illegitimate business:

Gambling
Bookmaking
Narcotics
Loansharking
Labor racketeering
Extortion
Alcohol
Kidnapping
SOME CHARACTERISTICS OF ORGANIZED CRIME:

Conspiracy & Hierarchy — planning, organizing, executing; three or more permanent levels of rank with a division of labor or specialization
Ideology of Economics — it’s just business, nothing personal; it’s probably more accurate to say they have no ideology, no politics; intimidation, violence, and coercion are business, profit oriented
Perpetuity — the organization is designed to last through time, beyond the lifespan of current members via a mix of legitimate “fronts”
Monopoly — they have total control over a particular turf or industry, seeking goods or services that are presently illegal or quasi-illicit and that have such a demand that raising price won’t matter
Strict discipline — the group controls its members promptly, deadly; there’s a code of silence, secrecy, extensive rules and regulations
Restricted membership — on ethnic, kinship, criminal record, or other grounds; applicants need a sponsor; not anyone can join
Immunity from prosecution — the group is interested in corruption, in fixing the criminal justice system
    Organized crime accounts for 1-2% of the gross national product.   It’s annual income outranks most major industries in the United States.  The major sources of revenue come from infiltration of labor unions, taking control of pension funds and dues.  Hijacking of shipments and cargo theft are other significant sources of income, along with Internet pornography and call girl/escort services.  Organized crime infiltrates legitimate businesses which are low tech (such as garbage collection), have uniform products, and operate in rigid markets where price increases will not reduce demand.  If someone operates such a business, they are a prime target for mob infiltration.  Other businesses are sought after solely to provide a “front” or for money laundering operations. 

    The classic pattern of organized crime is a gradual movement from:

assault (dirty deeds)

bribery (the fix)

extortion (protection racket) 

illegitimate business (narcotics)

legitimate business (entertainment)

big business (unions, corporations)

THE HISTORY OF ORGANIZED CRIME

    According to proponents of alien conspiracy theory, sometime around 1900, a group called the Black Hand (a lower east side Manhattan gang modeled after the Sicilian Mafia) led by Johnny Torrio, leader of the Five Points Gang, set up a national syndicate of 25 or so Italian-dominated crime families calling themselves La Cosa Nostra (LCN or “this thing of ours”, also called the Mob or Mafia), the most important five families being the Gambino, Columbo, Lucchese, Bonnano, and Genovese, the founding “godfathers”. Meetings throughout the U.S. during the 1920s and 1930s helped settle the differences between Sicilians and Italians (who had always been at odds with one another), discover ways to settle gang wars nonviolently and maximize profits.  During prohibition, LCN concentrated on alcohol; after prohibition, narcotics and bookmaking.  After WW II, LCN moved into entertainment (Cuba, Vegas, hotel chains, jukebox concerns, restaurants, and taverns).   By effective payoffs, blackmail, and coercion, by the 1950s, the mobsters became respectable businessmen, and moved into labor unions. Two commissions, the Kefauver and McClellan commissions looked into these activities.   During the 1960s, via succession due to repeated assassinations of other aspiring leaders, Carlo Gambino ran the Mob until his death of natural causes in 1976, then John Gotti emerged to run the Gambino family until 1992. A major FBI crackdown began in 1981 and is continuing. The typical LCN chain of command is an industrial model: a boss (don), with an advisor (consigliere) and underboss (sort of vice president). Answering to the underboss are caporegimas (heads of regiments or lieutenants or captains) who are chiefs to soldati (“buttons”, soldiers).

    Ethnic succession is the rule for transition in organized crime. As one group wanes, another group stands ready to take its place. Today, other ethnic groups have forged a loose confederation of organized crime.  These include the Dixie Mafia in the South, Latin American gangs in the Southwest, White ethnic groups across the nation, and Italian and Cuban groups operating worldwide.  Since 1970, Russian and Asian (Chinese and Japanese) groups have been operating on U.S. soil, the Russian groups especially good at fencing stolen merchandise and the Asian groups especially good as the heroin market.  Nigerian/West African groups also operate in the U.S.  American-made biker gangs pick up the market for drugs not monopolized by other groups.  The Colombian drug cartels concentrated on cocaine smuggling. During the 1980s and into the 1990s, the black gangs abandoned their inner city isolation and adopted the “franchise” model (Crips & Bloods).

    Biker gangs are “outlaw motorcycle gangs”, a breed apart from most biker organizations.  The oldest ones (Hells Angels, Pagans, Outlaws) trace their origins to clubs formed in the 1930s and 1940s.  When the American Motorcycle Association said that 99 percent of riders were law-abiding, outlaw bikers started calling themselves “1%ers,” and wearing “1%er” patches on their jackets, along with other insignia, known as “colors.” Members of outlaw clubs are often called patch-holders, and protecting club symbols can be a matter of life and death.  The Hells Angels are the largest group, with chapters across the United States, in Canada, Australia, Europe and elsewhere. They have about 2,100 members.  The Bandidos, based in the Southwest are a close second, also with about 2,100 members.  They have been rapidly expanding in recent years.  The Outlaws, with about 1,200 members, are dominant in the Midwest and Southeast, and their leader was convicted of racketeering and conspiracy in 2001.  The Pagans have about 450 members, mostly in the Northeast, and have been cracked down on most by law enforcement.  The Mongols are a Latino-dominated club based in East Los Angeles, with about 250 members. They are the subject of extensive Bureau of Alcohol, Tobacco and Firearms investigations into alleged dealings in illegal guns and methamphetamine.  Most groups support themselves primarily through drug dealing, trafficking in stolen goods, and extortion.  They fight over territory and drugs.

    Non-outlaw motorcycle clubs include the Soldiers for Jesus, a Christian Motorcycle Association group; the Kings, a club of African-American bikers in Brooklyn, N.Y.; and clubs of law enforcement officers, such as the Blue Knights and Wild Pigs. 

LAW ENFORCEMENT

    Traditionally, organized crime has been immune from prosecution because of public apathy and because of its own strong political connections. Police have always used “alternative” police tactics because traditional law enforcement doesn’t work.  A few of the things that have been tried include: community policing, informants, surveillance, undercover operations, immunity (transactional immunity provides blanket protection against prosecution for crimes about which a person is compelled to testify; use immunity prohibits anything the person says from being used against them, but they can still be prosecuted using evidence obtained independently) and witness protection programs (currently over 14,000 persons are in the Federal Witness Protection Program).  The most common reasons for arrest of organized crime members are racketeering, drugs, stolen property, prostitution, gambling, and murder.  In the last 5 years, 1,170 Cosa Nostra bosses, capos, and soldati have been convicted and sentenced.

    By far, the most effective measure has been the 1970 Organized Crime Control Act. Title IX of that act is called RICO (Racketeer Influenced and Corrupt Organization). It listed 24 different activities (such as bribery, extortion, murder) associated with organized criminal activity, lessened the rules on what defines a conspiracy, and gave law enforcement the tool of asset forfeiture, the seizure of assets, proceeds, and instrumentalities of crime.  In the 1980s, this paid off handsomely for law enforcement.  Today, the younger generation of gangsters are more willing to break the code of silence and turn informer than face prison terms. To be deemed a racketeer, the suspect must have committed at least two of the 24 different activities on the list within a ten-year period, and participation in the organization supporting the activity must be shown. Participants are then found guilty for the acts of the criminal organization regardless of their personal participation. RICO penalties are severe; prison sentences are double or triple the usual amount.

    Racketeering prosecutions involve the strike force concept.  In a good year, 500 mobsters get convicted.  The FBI, DEA, ATF, Labor, IRS, and local law enforcement all have joint responsibility for organized crime. Several other possible law enforcement objectives have been examined:

decriminalization — the idea here is that by lessening the penalties associated with traditional vice activities, this cuts into the “bread and butter” of organized crime

regulation — this involves using zoning and licensing ordinances to control vice activities, essentially creating red-light districts where organized crime is allowed to operate, but with the government in for a piece of the action

reduction of profitability — this involves putting caps on insurance claims, arson payments, and essentially making government more active and efficient than organized crime

harassment — this is an old tactic involving disruption of distribution networks, electronic surveillance, special grand jury presentments, and other controversial methods

    UNDERCOVER operations are usually only called for when, by no other means, can you get information on an impending crime the group is about to commit.  Other appropriate uses are to locate contraband storage areas, and to check on the reliability of informants and snitches.

    INFORMANTS are notoriously difficult to control with organized crime, but are absolutely essential with newly emerging gangs for which there is no historical database. One of the jobs of the analyst is often to corroborate an informant’s information (by checking on whether it is substantiated by other intelligence) and to determine informant reliability. The following terminology is standard for rating informants:

Reliable — no doubt of person’s authenticity; past info reliable in all instances

Usually Reliable — some doubt, but past info has been reliable in most instances

Fairly Reliable — some doubt, but past info has been reliable on average

Not usually Reliable — there is doubt, and past info has only been reliable on occasion

Unreliable — there is great doubt; past experience has proven it to be unreliable but that doesn’t mean that this piece of info now is not reliable

GENRES OF ORGANIZED CRIME

Aboriginal — This is word meaning “native peoples”, and aboriginal organized crime is mainly a problem in Canada. In that country, several Indian tribes control the illegal tobacco, weapons, and gaming markets.  It’s of special concern to Canadian authorities right now since Canada is trying to move toward becoming a disarmed society.  For background, see any one of the Annual Reports by the Criminal Intelligence Service of Canada.

Chinese — The Tongs and Triad (Chinese Mafia) have been involved in business extortion, alien trafficking (with Mexico), the underground garlic trade (in Taiwan), software piracy, and of course, the more traditional drugs, gambling, and prostitution in Chinatowns across the world. The Tongs are an old secret society, going back to the mid-1800s. They operate behind immigrant protection associations, but have many of the characteristics of traditional organized gangs. The Triads are what the British called them because of their fascination with numerology, the importance of the number three, and their mystical initiation ceremonies. They believe it is their destiny to control all vice activity. 

Colombian — The Colombian drug cartels have been a heavily-studied organized crime group, and although arrest or disappearance of their leaders has always brought authorities hope that the syndicate is over, they just seem to keep reorganizing. There’s a real sense of popular support for the drug barons in Colombia as little poor guys who made it big, and the different cartels have close, intricate relationships. Although it’s dangerous to make rough comparisons, Mendellin-type cartels tend to act like petty street hoodlums, and Cali-type cartels tend to operate like legitimate businessmen. The Colombians tend to have many sympathizers, and a complex infrastructure, employing as many as 24,000 people in a typical operation.

Italian — More has been written about Italian Mafia business than probably any other topic. See any of the suggested Internet Resources at the bottom of this page for information on this genre.

Jamaican — The Jamaican Posse underworld (from Kingston) has developed a reputation as one of the first “nontraditional” organized crime groups.  They basically developed the marketing techniques for crack, controlling about 40% of it in the U.S. They also engage in kidnapping, murder, robbery, and auto theft.  There are 40 known posses operating throughout the U.S., for a total of 22,000 hardcore members.

Japanese — The Yakuza (origins: 7th century) have always been at the center of Asian organized crime action, and are a persistent source of irritation to Japanese authorities. They do, however, pose some threats to the United States (in California and Hawaii) in terms of money laundering and weapons smuggling, which are their primary international sources of revenue. Their legitimate activities include banking and real estate. They have a highly structured hierarchy.

Jewish — In Israel, several Jews from the former Soviet state of Georgia have formed organized crime groups, and of course, there’s been gangster-style Jewish organized crime in America ever since the days of Meyer Lansky (one of the best books on him is But He Was Good to His Mother)

Mexican — Alien smuggling, drug trafficking, and money laundering are big business for the Mexican Mafia (Neustra Cosa).  Narcotics control has always been the number one U.S. concern.

Nigerian — The situation in Nigeria mostly revolves around the drug trade.

Outlaw Motorcycle Gangs — Drugs, prostitution, strip club infiltration, anti-police tactics, and courtroom disruption techniques are just some of the major activities of this group. While many motorcycle enthusiasts are just rowdies, a disturbing number are involved in organized crime.

Russian — The mobsters who now rule Russia are engaged in nuclear smuggling, corruption, loansharking, bootlegging (gasoline) and protection rackets.  The Casey Institute keeps good track of them. There are about 5,000 different gangs in Russia, with an average of 20 members each. About 25 of these gangs operate abroad, in the U.S. or Europe, especially in South Brooklyn and Berlin.

Vietnamese — Triad groups and gangs of Vietnamese origin (e.g., Born to Kill) are of growing concern to U.S. authorities, compared to other gangs. They are considered by many to be the most ruthless of the Asian gangs.

ORGANIZED CRIME ACTIVITIES

alcohol & tobacco smuggling

arms trafficking

corruption (bribery)

counterfeiting

drug trafficking

extortion

fraud

gambling (numbers and bookmaking)

labor racketeering

loan sharking

theft, robbery, hijacking & home invasion

sex slave and children for sex

smuggling of humans and human parts

violence (assassination, “hits”, dirty deeds)

    There are two major forms of illegal gambling: numbers and bookmaking. Numbers is a form of lottery in which a person places a bet from $1-10 by choosing 3 numbers between 000 and 999, then receiving a receipt from a “numbers runner”.  The runner, who has several copies of the receipt, passes one to a “pickup” who carries it to the “bank” or the accounting room of the numbers operation.  If the customer wins, they get a multiple (100-500 times the amount of the bet) payoff.  There are different ways of determining the winning number. The “Brooklyn method” is based on the last three digits of the total amount of money a particular racetrack handles on a specific day. Runners make a 25% commission on their receipts, besides tips. The banker usually pays off the police. Bookmaking is sports betting. For basketball and football, one team is usually given a handicap of a certain number of points, called a “spread”.  If the 49ers are handicapped by 8 points against the Bears, a person betting on the 49ers wins if the 49ers win by more than 8 points.  A person betting on the Bears wins if the Bears win or lose by less than 8 points. If the 49ers win by exactly 8 points, all bets are returned.  To prevent returns, most bookmakers express the spread in half-point values, such as 8.5 points. A bookmaking operation requires a “bookie” (who sets limits on the size of bets), a runner (who transfers money), and a clerk (who handles the records). Some bookies have a “tabber” who keeps tabs on changing spreads.

ORGANIZED CRIMINAL OFFENDERS
They seem to come from low-income backgrounds in high crime areas of the inner city.  Most begin as ordinary street criminals, but rather than retiring or “ageing out” of crime, they continue their careers into their late 20s and 30s, progressing up the “queer ladder of mobility” (as it’s been called) that is organized crime (individuals on their own make their mark and hope to be noticed, recruited or selected).  It’s a bit more than the “jumping-in” rituals associated with gang crime.  The initiate becomes a “made” man, and joins the ranks of a worldwide organization of professional criminals in elaborate initiation ceremonies, learning to avoid emotional, unplanned criminal activity. If the organized criminal is allowed any leeway at all, it’s toward the goal of corrupting the criminal justice system. The idea is to constantly be on the make for opportunities and setups to get the goods on somebody. 

INTELLIGENCE ANALYSIS OF ORGANIZED CRIME

    Organized crime is the natural home for intelligence analysis.  Almost every analytic technique available can be used, from activity flow charts to conversation analysis to telephone records. This is the one area where ELINT has played a major role since wiretapping has been around a long time with organized crime. Here’s some typical analytical products:

1. ASSOCIATION ANALYSIS — Using data received through surveillance or informants, a link chart is produced showing the links between known and suspected members of the organized crime group. The chart should look like a family tree.  It can list people, places, or entities. 

2. TELEPHONE ANALYSIS — Using telephone wiretap information or other “wires”, a frequency distribution chart is produced, showing the time of the call (start/end), to whom, and the total length of time. The result is a rather graphic portrayal of who and where the suspect calls most of the time. The analyst can also add the known time of certain events into the chart.  A gambling operation would show, for example, a flurry of calls right before a sporting event.

3. CONVERSATION ANALYSIS — Using eavesdropping information, testimony of snitches, or other “wires”, the analyst can often put together a content analysis chart, showing that certain phrases like “I want to to whack em good” always precede an act of violence against somebody.  This is especially important if the members of the organization speak in code words, like “you gotta do what you gotta do”.  Discourse analysis as well as other more advanced forms of linguistic analysis allow deciphering tone, meter, and inflection in the voice to read the messages behind the words spoken.
INTERNET RESOURCES

Classic Financial Scandals & Organized Crime
Eastern European Organized Crime
GangLand: Mafia News & La Cosa Nostra & LCN Cities
Global Organized Crime Project
INTERPOL: Definitions of Organized Crime
Organized Crime: an annotated bibliography
Organized Crime Registry **
Ridgeway Center for Transnational Organized Crime
Russian Organized Crime
U.S. Treasury Dept: Following the Money
Yahoo’s List of Organized Crime websites
Yakuza: a history & Yakuza: past and present

PRINTED RESOURCES

Abadinsky, H. (1981). The Mafia in America: An Oral History. NY: Praeger.
Abadinsky, H. (2002). Organized Crime, 7e. Belmont, CA: Wadsworth.
Albanese, J. (1989). Organized Crime in America, 2e. Cincinnati: Anderson.
Albini, J. (1988). “Donald Cressey’s Contribution to the Study of Organized Crime: An Evaluation.” Crime and Delinquency 34: 338-54.
Albini, J. (1991). The American Mafia: Genesis of a Legend. NY: Appleton-Century Crofts.
Capeci, J. (2001). The Complete Idiot’s Guide to the Mafia. Indianapolis: Alpha Books. [sample pages]
Cressey, D. (1969). Theft of a Nation: The Structure and Operations of Organized Crime in America. NY: Harper.
Reppetto, T. (2003). American Mafia: A History of its Rise to Power. NY: Holt.
Reuter, P. (1984). Disorganized Crime. Cambridge, MA: MIT Press.
Rogovin, C. & F. Martens. (1989). “Albini on Cressey.” Criminal Organizations 4(4): 11-14.
Salerno, R. & J. Tompkins. (1969). The Crime Confederation. Garden City, NJ: Doubleday.
Sifakis, C. (1999). The Mafia Encyclopedia. NY: Checkmark Books.

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