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Vol. L · No. I FOL. LArticles

Avery & Avery, Esqs. Ridgefield, NJ John S. Avery, Esq.

What Is Racketeering — RICO Charges in NJ

JS·A

By John S. Avery, Esq.

Partner · Trial & Appellate

By John S. Avery, Esq.

“Racketeering” is a word with a specific legal meaning that bears little relation to the casual usage. In law, it refers to a pattern of activity within an enterprise that can be charged under the federal Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-1968, or NJ’s analogous NJ RICO at N.J.S.A. 2C:41-1 et seq. RICO charges are first- or second-degree crimes carrying substantial sentencing exposure, and they are particularly dangerous because they aggregate otherwise-disparate predicate acts into a single enterprise theory. This post walks through what RICO actually means.

Information post on NJ RICO and federal RICO. Not legal advice. Free consultation: (201) 943-2445.

The Statutory Framework

NJ RICO at N.J.S.A. 2C:41-2 prohibits four categories of conduct involving an “enterprise”:

  1. Acquiring or maintaining an interest in an enterprise through a pattern of racketeering activity (subsection (a))
  2. Conducting or participating in an enterprise’s affairs through a pattern of racketeering activity (subsection (c))
  3. Conspiring to commit either (subsection (d))

Federal RICO at 18 U.S.C. § 1962 mirrors these categories with federal-jurisdictional triggers (interstate commerce).

The Core Elements

To convict on a NJ RICO charge, the State must prove:

1. An Enterprise

An “enterprise” is defined broadly — any group of individuals associated in fact, even if not a legal entity, qualifies. Boyle v. United States, 556 U.S. 938 (2009) is the seminal federal opinion; NJ courts apply parallel analysis. The enterprise must have:

  • A common purpose
  • Relationships among those associated with the enterprise
  • Longevity sufficient to permit pursuit of the purpose

2. A Pattern of Racketeering Activity

A “pattern” requires at least two predicate acts of racketeering activity within a 10-year period. Predicate acts under N.J.S.A. 2C:41-1(a) include murder, kidnapping, gambling, extortion, bribery, money laundering, theft, fraud, narcotics trafficking, and many other enumerated offenses.

The two-act minimum is necessary but not sufficient. H.J. Inc. v. Northwestern Bell Telephone, 492 U.S. 229 (1989) added the “continuity” requirement — a closed-ended pattern of activity extending over a substantial period, or an open-ended pattern with the threat of continuing activity.

3. The Defendant’s Connection to the Enterprise

The defendant must have either acquired or maintained an interest in the enterprise (subsection (a)) or participated in conducting its affairs (subsection (c)). The federal Reves v. Ernst & Young, 507 U.S. 170 (1993) “operation or management” test applies in substantially parallel form in NJ analysis.

Penalty Exposure

NJ RICO is graded as:

  • Second-degree crime — for most enterprises (5-10 years)
  • First-degree crime — for “racketeer enterprise” leadership positions or specified high-value patterns (10-20 years)

Federal RICO carries up to 20 years per RICO count, plus the underlying predicate-act exposure, plus civil-RICO triple-damages exposure under 18 U.S.C. § 1964(c) (which extends to private plaintiffs).

Defense Analysis

The defense work in a RICO matter:

1. Enterprise Element

Was there actually an enterprise? Loose associations of individuals engaged in unconnected activity do not satisfy Boyle’s common-purpose requirement.

2. Pattern Element

Were there at least two predicate acts? Were the acts sufficiently related and continuous to constitute a pattern under H.J. Inc.? Disparate acts that don’t share a continuity nexus do not satisfy the pattern.

3. Operation-or-Management Element

Did the defendant participate in operating or managing the enterprise? Outside vendors, customers, and peripheral participants typically do not satisfy Reves.

4. Statute-of-Limitations Analysis

NJ RICO has a 5-year limitation under N.J.S.A. 2C:1-6(b)(1). Where the predicate acts span a long timeframe, limitations analysis is critical.

5. Severance Motion

Multi-defendant RICO indictments are dense. Severance under R. 3:15-2 may be appropriate where joint trial would prejudice.

Common Charges That Are Not Actually RICO

Prosecutors sometimes use “racketeering” colloquially. Charges that are not RICO:

  • Conspiracy under N.J.S.A. 2C:5-2 — separate offense, not a RICO predicate by itself
  • Money laundering under N.J.S.A. 2C:21-25 — predicate, but standalone money-laundering is not RICO
  • Drug distribution under N.J.S.A. 2C:35-5 — predicate, but ordinary distribution charges don’t aggregate to RICO without the enterprise + pattern elements

Frequently Asked Questions

Are RICO and conspiracy the same thing?

No. RICO requires an enterprise plus a pattern of racketeering activity. Conspiracy requires an agreement plus an overt act in furtherance. They overlap in some fact patterns but are distinct offenses.

Does the federal government prosecute NJ RICO matters?

The federal government prosecutes federal RICO under 18 U.S.C. § 1961. The State of NJ prosecutes NJ RICO under N.J.S.A. 2C:41. Some matters are prosecuted in both forums under separate sovereigns.

Is RICO only for organized crime?

No. RICO is used for traditional organized crime, but also for white-collar enterprises (corrupt corporations, fraud schemes), political-corruption cases, and (increasingly) cybercrime prosecutions.

How long does a RICO trial take?

Multi-defendant RICO trials in NJ Superior Court typically run 3-12 weeks. Federal multi-defendant RICO trials sometimes longer.

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