How La Cosa Nostra Makes M oney

1. How La Cosa Nostra Makes Money

2. Racket • An illegal business or scheme

3. Labor Racketeering • The infiltration, domination, and/or use of a union or employee benefit plan for personal benefit by illegal, violent, or fraudulent means

4. Labor Racketeering • Basically, the mob uses their power and influence to control unions

5. Labor Racketeering You may be saying, “Interesting, but how does that affect me, Joe Highschool?” I’m glad you asked…

6. Labor Racketeering • FBI investigations have shown that labor racketeering costs the American public (aka you and me) millions of dollars each year. How you ask? Like this…

7. Labor Racketeering • Organized Crime can control the pricing in an entire industry • Manipulate value of shares on the stock market • Orchestrate strikes and work slowdowns • Rig bidding for contracts

8. Extortion • Unlawfully obtaining money, property, or services through intimidation or coercion • Shakedown • Making a threat of violence to require a payment in order to prevent future violence

9. Protection Racket • Extortion scheme • Coerce the victim to pay money for protection against violence or damage to their property • Racketeers convince victim to pay by showing them what will happen if they don’t • In most cases, the racketeers are only protecting the victim from the racketeers themselves

10. Gambling • Point-Shaving • Difficult to pull off • Convince a player, coach, or official to prevent his team from covering the betting line

11. Gambling • Book-Making • Establishing the odds, point spread, or over/under for a variety of events • Usual goal is to have a “balanced book” • As much coming in as is going out • Mob bookies get unsuspecting bettors to gamble on their “skewed” lines

12. Loan Sharking • Offering loans at extremelyhigh interest rates • Sometimes enforce payments with the threat of violence • People who “go to the sharks;” • Businesses who need money for protection • Gamblers to pay bookies

13. Unfortunately, we give the mafia its power. We need, and want, what they provide. They know this, and that knowledge allows them to drive up prices, make exorbitant amounts of money, wield power, and avoid law enforcement

14. Skimming Taking cash “off the top” and reporting a lower total amount

15. What is Labor Racketeering? • The infiltration, domination, and/or use of a union or employee benefit plan for personal benefit by illegal, violent, or fraudulent means

16. What is Extortion? • Unlawfully obtaining money, property, or services through intimidation or coercion • Shakedown • Making a threat of violence to require a payment in order to prevent FUTURE violence

17. What is Loansharking? • Offering loans at extremely high interest rates

18. Skimming • Cashier doesn’t ring up transaction and instead, pockets the money • Businessman needs money to pay off extortionist—can’t record transaction—skims money to pay bribe • The larger the business, the more susceptible it is to skimming • Why?

19. Counterfeit To imitate something; produce fake replicas

20. Counterfeit • Depends on the naiveté of the buyer • Often of low quality • Types of things commonly counterfeited • Money • Clothing • Purses • Art • Electronics

21. Fraud Deception for personal gain

22. Link Chart Created during an ASSOCIATION ANALYIS to identify organized crime members

23. Link Chart

24. Numbers Racket • “Running the numbers” • Illegal lottery game • Preceded state-run lotteries • Popular in poor communities • Bookies extended credit to bettors

25. Numbers Racket • Match your number to the selected number • Payouts were usually 600 to 1 • However, odds of winning were 1000 to 1 You can see how the mob could make a lot of money with a numbers racket

26. Vigorish or The Vig Juice, The Cut, The Take • Amount charged by a bookie for his services • Allows the bookie to make money in the event that the payout is more than the intake • Interest on a loan shark’s loan • Difference between the the dollar amount of tickets and payout in a Numbers Racket