The Racketeering Influenced and Corrupt Organizations Act (RICO) was introduced into US federal law in 1970. Under title 18 of the United States Code (U.S.C.), the RICO statute stipulates that it is unlawful:
- To invest income derived from a pattern of racketeering activity in an enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce (section 1962(a));
- To acquire or maintain an interest in an enterprise through a pattern of racketeering activity (section 1962(b));
- To conduct an enterprise’s affairs through a pattern of racketeering activity (section 1962(c)); and
- To conspire to violate any of the three preceding offences (section 1962(d)).
The RICO statute lists a wide range of US federal and state criminal offences that amount to “racketeering activity”. Furthermore, a “pattern” of racketeering activity requires proof that at least two listed racketeering offences (also referred to as “predicate offences”) occurred within the last 10 years.
Extra territorial reach of RICO offences into Australia
A person who resides in Australia can still be indicted in the US for allegedly violating any of the RICO offences listed above, subject to some limitations. In the US, federal laws are construed to have only domestic application absent clear and express congressional intent that states otherwise. In RJR Nabisco, Inc. v. European Community, et al., No. 15-138 (June 20, 2016) the US Supreme Court held that this presumption had been rebutted with respect to certain applications of RICO’s substantive offences under section 1962.
Provided that the alleged “racketeering” or “predicate” offences applied to criminal conduct outside the US, then the substantive RICO offence also applied extraterritorially. This fact is determinative in relation to sections 1962(b) and (c). However, the Court noted that the RICO offence under section 1962(a) could arguably have domestic application only but declined to make a decision on the issue. The Court also assumed that the RICO conspiracy provision (section 1962(d)) could be applied extraterritorially because it relies upon the operation of a substantive RICO provision.
Some racketeering or predicate offences that have extraterritorial application include (but are not limited to):
- Obstruction of official proceeding (title 18 S.C. section 1512(h));
- Assassination of Government officials (title 18 S.C. sections 351(i) & 1751(k));
- Hostage taking (title 18 S.C. section 1203(b)); and
- Drug conspiracy and distribution (title 21 S.C. sections 846 & 963; Chua Han Mow v. United States, 730 F.2d at 1311-13)
Thus, the extraterritorial application of the RICO offences is highly dependent on the alleged predicate offences engaged in as part of an enterprise’s pattern of racketeering activity.
Extradition to the U.S. for alleged violation of RICO
Since RICO offences may apply to a foreign national who has engaged in illicit conduct that occurred entirely outside the US, alleged defendants residing in Australia are exposed to extradition. Notably, there are still no Australian cases that have considered the extradition of persons who are specifically charged with RICO offences. Nevertheless, the US has been successful on a number of occasions in extraditing Australian residents for other criminal offences.
For example, in Riley v Commonwealth (1985) 62 ALR 497, the appellant unsuccessfully appealed against a decision for their extradition to the US. The appellant argued that the dual criminality principle was not satisfied. However, the High Court held that even though the US offence of “continuing criminal enterprise” was not known to the law of NSW, it still amounted to an ‘extradition crime’ under the Extradition (Foreign States) Act 1966 (Cth) (now superseded). Thus, the dual criminality principle was satisfied because the alleged acts constituting the US offence would, prima facie, also amount to narcotics and dangerous substances offences in NSW.
In Lobban v Minister for Justice  FCA 1361, the appellant was charged in the US for several offences including promotion of a sexual performance by a child, solicitation to commit aggravated child abuse and solicitation to commit lewd or lascivious battery. Lobban contested his surrender to the US on several grounds including one which argued that the Minister’s decision was ‘so unreasonable that no reasonable authority could ever have come to it’. However, Lobban’s grounds of appeal were all dismissed.
The potential extraterritorial reach of the RICO offences means that Australian residents may be at risk of extradition to the U.S.
Nyman Gibson Miralis provides expert advice and representation in complex transnational cases involving extradition and mutual legal assistance.
Contact us if you require assistance.