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124019NCJRS.Pdf If you have issues viewing or accessing this file contact us at NCJRS.gov. • • A Study of ORGANIZED CRlME BUSINESS-TYPE ACTIVITIES and Their • IMPLICATIONS FOR LAW ENFORCEMENT • • Prepared for the NATIONAL INSTITUTE OF JUSTICE Washington, D.C. • by • Herbert Edelhertz and Thomas D. Overcast January 1990 • Northwest Policy Studies Center Kirkland, Washington • ~--------- - • • A Study of • ORGANIZED tRIME BUSINESS-TYPE ACTIVITIES and Their IMPLICATIONS FOR LAW ENFORCEMENT • Prepared for the NATIONAL INSTITUTE OF JUSTICE Washington, D.C. I • by Herbert Edelhertz and Thomas D. Overcast • January 1990 Northwest Policy Studies Center • Kirkland, Washington This study was supported by Grant Number 87-IJ-CX-0053 awarded to the Northwest Policy Studies Center by the National Institute of Justice, U.S. Department of Justice, under the Omnibus Crime Control and • Safe Streets Act of 1986, as amended. Points of view or opinions stated in this document are those of the authors and do not necessarily represent the official position or policies of the U.S. Department of Justice. • • • • • 124019 U.S. Department of Justice National Institute of Justice This document has been reproduced exactly as received from the person or organization originating it. Points of view or opinions stated in this document are those of the authors and do not necessarily represent'the official position or policies of the National Institute of • Justice. Permission to reproduce this : 5 I material has been granted by Public DomainLNIJ u. S. Department of .Just; ce 10 the National Criminal Justice Reference Service (NCJRS). • Further reproduction outside of the NCJRS syslem requires permis· sian of the ___ owner. • • ,.;.. • • • • • Table of Contents Abstract ............................................................................................................................ i Preface and Acknowledgments ....................................................................................... iii List of Tables ................................................................................................................... vii Executive Summary ........................................................................................................ ix • 1. ORGANIZED CRIME AS BUSINESS ....................................................................... 1 Introduction .......................................................................................................... 1 Definition of Organized Crime ............................................................................ 1 Definition of Business-Type Activities ................................................................ 3 Nature and Significance of the Issues .................................................................. 4 The Resilience of Organized Criminal Groups ....................................... .4 • Weakening the Resilience of Organized Criminal Groups ...................... 5 Guide to the Report .............................................................................................. 7 II. BUSINESS TYPE ACTMTIES ILLEGAL ACfMTY.......................................... 9 Introduction .......................... " ..................... , ........................................................ 9 Offenses Charged ................................................................................................. 10 • Other Illegal Activity .................................................. :........................................ 13 Factors Related to Cases and Evidence .................................................... 15 The Role of Investigative Agencies ......................................................... 16 Prosecutorial Priorities ............................................................................. 16 Relationships Among Illegal Activities ............................................................... 17 Specific Illegal Activities and Practices ............................................................... 22 • Street Taxes ............................................................................................... 22 Loansharking ............................................................................................ 23 (1) Bridge Loans ........................................................................... 24 (2) Loanshark use of legal procedures as leverage ...................... 24 (3) Check Cashing Services ......................................................... 25 Arson ........................................................................................................ 25 • White-Collar Crime .................................................................................. 26 Labor Abuses ............................................................................................ 28 (1) l,abor Leasing ................................ ~ ........................................ 29 (2) Desk Drawer Contracts ........................................................... 31 Monopolies ............................................................................................... 32 (1) The New York City Concrete Construction Monopoly.......... 32 • Market Regulation .................................................................................... 35 (1) New York City's Fulton Fish Market. .................................... 35 Immigration Issues ................................................................................... 37 Illegal Activities as Specialties ............................................................................ 37 m. BUSINESS TYPE ACTIVITIES LEGAL ACfMTY ........................................... .41 • Introduction .......................................................................................................... 41 The Character and Frequency of Legal Activities .............................................. .42 Attraction to Particular Legal Activity................................................................. 45 Targets of Opportunity ............................................................................. 46 The Business Environment. ...................................................................... 4 7 • "Choke Points" in Legal Activities .......................................................... 4 9 Deficiencies in Industry Regulation or Oversight. ................................... 50 The Importance of Union Control.. .......................................................... 51 • • The Purpose of Providing Legal Goods and Services .......................................... 52 Relationships Between Illegal and Legal Activities ............................................ 54 • N. BUSINESS-TYPE ACTNITIES USE OF SERVICES ........................................... 57 Introduction .......................................................................................................... 5 7 An Inventory of Services Used ............................................................................ 60 Legal Services ........................................................................................... 62 • i\ccounting ............................................................................................... 65 Banking .............. ,. .................................................................................... 66 Bookkeeping ............................................................................................. 66 Travel and Transportation Services .......................................................... 67 Communications ....................................................................................... 67 Real Estate Services ................................................................................. 68 Courier and Messenger Services .............................................................. 68 • Securities Brokerages ............................................................................... 68 Health Care Services ................................................................................. 69 Automobile Dealers .................................................................................. 70 Printing Services ...................................................................................... 70 Miscellaneous Services Used ................................................................... 7 1 • (1) Ohio State Lottery .................................................................. 7 1 (2) Quasi-Financial Services ........... : ............................................ 71 (3) Electronic Security Services ................................................... 72 (4) Lobbying and Public Relations ............................................... 72 (5) Intelligence ............................................................................. 73 (6) Consultant Services ................................................................ 74 • Criminal Purposes and Utilization of Legitimate Services .................................. 76 Extent of Utilization of Services .............................................................. 77 Awareness ................................................................................................ 77 Vulnerability to Law Enforcement. .......................................................... 77 V. BUSINESS FUNCTIONS IN ORGANIZED CRIME .............................................. 79 • Introduction .........................................................................................................
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