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2 be cited as the "Racketeer Influenced and Corrupt Organizations

3 Act of 19 7 7 . "

4 Section II. Findings of fact--The legislature of the

5 State of Florida finds that:

6 (1) Organized crime is a highly sophisticated, diversi-

7 fied, and widespread phenomenon which annually drains sub-

8 stantial revenues from the state economy by various patterns

9 of racketeering activity including the illegal use of force,

10 fraud, and corruption;

11 (2) Organized crime exists within the State of Florida

12 engaging in the same patterns of racketeering activity which

13 characterize its activities nationally;

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(3) The large amounts of money and power held by

organized crime are used to infiltrate and corrupt legitimate

businesses operating within the State with techniques of

violence, intimidation, and other forms of racketeering activit

through which such money and power are derived;

(4) Organized crime utilizes and applies to its un­

lawful purposes laws of Florida conferring the privileges of

engaging in various types of business and designed to insure

that such businesses are conducted in furtherance of the

public interest and the general economic welfare of the State;

(5) The infiltration and corruption of organizeJ

crime and patterns of racketeering activity provide an outlet

for illegally obtained capital; to harm innocent investors,

merchants and consumers, to interfere with free competition,

and thereby constitute a substantial danger to the economic

and general welfare of the State, and

(6) To resist and eliminate this evil, it is necessary

to provide new remedies and procedures contained in this act.

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Section III. De£initions--For the purposes 0£ this act:

(1) "Racketeering activities" shall mean to commit, to

3 attempt, threaten or conspire to commit, or to coerce or intim-

4 ida te another per son to comrni t:

5 (a) any act which is chargeable by indictment or

6 information under the following provisions of the Florida

7 Statutes:

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(1) s.210.18 (relating to evasion of

cigarette taxes).

(2) s.s.214.60-214.62 (relating to nonproperty

tax crimes).

(3) s.409.325 (relating to public assistance

fraud) .

(4) Chapter 447 (relating to labor organization

(5) Chapter 448 ( relating to general labor

regulations).

(6) Chapter 501 ( relating to deceptive and

unfair trade practices).

(7) Chapter 550 ( relating to dog and horse

racing).

(8) Chapter 551

(9) Chapter 562

enforcement)

relating to jai alai frontons).

relating to beverage law

(10) Chapter 687 ( relating to interest and

usurious practices).

(11) Chapter 782 ( relating to homicide).

(12) Chapter 787 (relating to kidnapping).

(13) Chapter 790 ( relating to weapons and

firearms).

(14) Chapter 796 (relating to prostitution).

(15) Chapter 806 (relating to arson).

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(16) Chapter 812 (relating to larceny and

robbery).

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(17) Chapter 817 (relating to fraudulent

practices: false pretenses and fraud generally and

credit card crimes).

(18) Chapter 831 (relating to forgery and count­

erfeiting).

(19) Chapter 832 (relating to issuance of

worthless checks and drafts).

(20) Chapter 836 (relating to defamation and

extortion).

(21) Chapter 837 (relating to perjury)

( 2 2) Chapter 838 (relating to bribery).

(23) Chapter 843 (relating to obstruction of

justice).

(24) Chapter 847 (relating to obscene litera-

ture).

(25) Chapter 849 (relating to gambling).

(26) Chapter 893 (relating to drug abuse

prevention and control)

(27) ss.918.12-918.14 (relating to tampering

with jurors, evidence and witnesses).

23 (b) For the purposes 0£ this act, racketeering act·

24 ity shall include any act defined as racketeering activity unde

25 Title 18, United States Code,. Section 1961 (1) (b), (c), and (d),

26 and a violation thereof may be one of the acts of racketeering

27 activity used to establish a pattern of racketeering activity

28 under this act.

29 (2) "Unlawful debt" shall mean any money or property con-

30 stituting principle or interest of a debt that is legally unen-

31 forceable in whole or in part,

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(a) because it was incurred or contracted in vioia

tion of the following provision of the Florida Statutes:

(1)

usery) .

(2)

racing).

( 3)

( 4)

Chapter 786 (relating to interest and

Chapter 550 (relating to dog and horse

Chapter 551 (relating to jai alai frontons).

Chapter 849 (relating to gambling); or

(b) because it was incurred or contracted in gamb­

ling activity in violation of the law of the United

States or in the business of lending money or a thing of

value at a rate usurious under Federal law.

(3) "Enterprise" shall mean any individual, sole propri

14 torship, partnership, corporation, association, or other legal

15 entity, or any union or group of individuals associated in fact

16 although not a legal entity.

17 (4) A "Pattern of racketeering activity11 is at least two

18 acts of racketeering activity, one of which occurred after the

19 effective date of this act and the last of which occurred with-

20 in four years after the commission of a prior act of racketeer-

21 ing acbvity.

22 (5) "Documentary material" includes any book, paper,

23 document, or other tangible item.

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Section IV. Prohibited Activities--

(1) It shall be unlawful for any person who has receive

26 any money or property derived, directly or indirectly, from a

27 pattern of racketeering activity or through collection of an un

28 lawful debt to use or invest, directly or indirectly, any part

29 of such money or property, or the proceeds from such money or

30 property in the acquisition of any interest in, or the establis

31 ment or operation of any enterprise or real property.

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l (2) It shall be unlawful for any person, through a pat-

2 tern of racketeering activity or through the collection of an

3 nlawful debt, to acquire or maintain, directly or indirectly,

4 ny interest or control of any enterprise or real property.

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( 3) It shall be unlawful for any person employed by, or

ssociated with, any enterprise to conduct or participate,

7 irectly or indirectly, in such enterprise through a pattern pf

8 _acketeering activity or the collection of an unlawful debt.

9 ( 4) It shall be unlawful for any person to conspire to

10 iolate any of the provisions of subsections (1), (2), or (3) of

11 this section.

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Section V. Criminal Penalties--

(1) Any person convicted of a violation of Section IV

hall be guilty of a felony of the first degree, punishable as

rovided in s.775.082, s.775.083, and s. 775.084.

16 (2) Any person convicted of a violation of Section IV

17 hall forfeit to the State:

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(a) any interest he has acquired or maintained in

violation of Section IV; and

(b) any interest in, security issued by, claim

against, or property or contractual right that affords

a source of influence over, any enterprise or real prop�

erty which he has owned, participated in, established,

operated, controlled, or conducted, in violation of

Section IV.

(3) In any action brought by the State under this sectio

the court shall enter such restraining orders or prohibitions,

28 or take such other action, including, but not limited to, the

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acceptance of satisfactory performance bonds, affecting any

property or other interest subject to forfeiture under this

section, as it shall deem proper.

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l (4) Upon conviction of a person under this section, the

2 court shall authorize the seizure of all property or other in-

3 terest declared forfeited. The State shall dispose of all for-

4 feited property as soon as commerciaily feasible, making due

5 provision for the rights of innocent persons. If a property rig t

6 or other interest is not exercisable or transferable for value

7 by the State, it shall expire and shall not revert to the con-

8 victed person.

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Section VI. Civil Remedies--

(1) The court may, after making due provision for the

11 rights of innocent persons, enjoin and restrain violations of

12 Section IV by issuing appropriate orders including, but not

13 limited to:

14 (a) ordering any person to divest himself of any intere_t,

15 direct or indirect, in any enterprise or real property;

16 (b) imposing reasonable restrictions on the future

17 activities or investments of any person, including but not

18 limited to, prohibiting any person from engaging in the same

19 type of endeavor as the enterprise in which he was engaged in

20 violation of Section IV;

21 (c) ordering the dissolution or reorganization of any

22 enterprise;

23 (d) ordering the suspension or revocation of licenses,

24 permits, or prior approval granted to any enterprise by any

25 department or agency of the state;

26 {e) ordering the forfeiture of the charter of a corpora

27 tion organized under the laws of this state or the revocation o

28 a certificate authorizing a foreign corporation to conduct busi

29 ness within this state upon finding that the board of directors

30 or a managerial agent acting on behalf of the corporation has,

31 in conducting the affairs of the corporation, purposely engaged

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1 in a pattern of racketeering activity and that for the preven-

2 tion of future criminal conduct of the same character, the pub-

3 lie interest requires the charter of the corporation forfeited

4 and the corporation dissolved or the certificate revoked.

5 (2) Any appropriate state agency may institute proceed-

6 ings under this section. In any action brought under this

7 section, the court shall proceed as soon as practicable to the

B hearing and determination thereof. Pending final determination,

9 the court may at any time enter such injunctions, prohibitions,

10 or restraining orders, or take such actions, including the ac-

11 ceptance of satisfactory performance bonds, as it shall deem

12 proper.

13 (3) Any person injured in his business or property by

14 reason of a violation of Section IV of this chapter may sue

15 therefor in any appropriate Florida court and shall recover

16 threefold the damages he sustains and the cost of the suit, in-

17 eluding a reasonable attorney's fee.

18 (4) A final judgment or decree rendered in favor of the

19 State in any criminal proceeding under this chapter shall estop

20 the defendant from denying the essential allegations of the

21 criminal offense in any subsequent civil proceedings broughtby

22 the State.

23 (5) The imposition of a civil penalty under any provis-

24 ion of this section shall not preclude the �nposition of any

25 other civil penalty (under this or any other section of the

26 Florida Statutes); civil remedies (under this act) are not

27 mutually exclusive.

28 Section VII. Civil Investigative Demand--

29 (1) For the purposes of this section "investigative

JO agency" shall mean the appropriate state agency having jurisdic

31 tion to investigate violations of Section IV as determined by

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1 the subject matter of the suspected violation of Section IV.

2 (2) Whenever the investigative agency has reason to

3 believe that any person or enterprise may be in possession,

4 custody, or control of any documentary material relevent to a

5 racketeering investigation, it may, prior to the institution

6 of a civil or criminal proceeding thereon, issue in writing,

7 and cause to be served upon such person, a civil investigative

B demand requiring such person to produce such material for exam-

9 ination.

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(3) Each such demand shall:

(a) state the nature of the conduct constituting

the alleged racketeering violation which is under in­

vestigation, the provision of law applicable thereto and

the connection between the documentary material demanded

and the conduct under investigation;

(b) describe the class or classes of documentary

material to be produced thereunder with such definiteness

and certainty as to permit such material to be fairly

identified;

(c) state that the demand is returnable forthwith

or prescribe a return date which will provide a reasonabl

period of time within which the material so demanded may

be assembled and made available for inspection and copy­

ing or reproduction;

(d) identify the person to whom such material shall

be made available; and

(e) be authorized and signed by the agency director

or his formal delegate.

(4) No such demand shall:

(a) contain any requirement which would be held to

be unreasonable if contained in a subpoena duces tecum

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issued by any court in aid of a grand jury investigation

of sue� alleged violation of Section IV; or

(b) require the production of any documentary evi-

dence which would be privileged from disclosur� if de­

manded by a subpoena duces tecum issued by any court in

aid of a grand jury investigation of such alleged racke­

teering violation.

(5) Service of any such demand or any petition filed

9 under this section shall be made in the manner prescribed by

10 the Florida Rules of Civil Procedure for service of writs and

11 complaints.

12 (6) A verified return by the individual serving any

13 such demand or petition setting forth the manner of such

14 service shall be prima facie proof of such service. In the cas

lS of service by registered or certified mail, such return shall

l6 be accompanied by the return post office receipt of delivery of

17 such demand.

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(7) Production and handling of documents.

(a) Any party upon whom any demand issued under this

section has been duly served shall make such material

available for inspection and copying or reproduction to

the investigative agency at the principal place of busi­

ness of such party, or at such other place as such in­

vestigative agency and such party thereafter may agree

and prescribe in writing or as the court may direct pur­

suant to this subsection, on the return date specified in

such demand, or on such later date as the investigative

agency may prescribe in writing. The investigative agen

may, with the permission of such party, take into its

possession the original copy of any such material.

(b) 'I'he investigat.Lve agency to whom any docurnenta· y

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material is so delivered shall take physical possession

thereof, and shall be responsible for the use made there-

of and for its return pursuant to this section. 'I'he in-

vestigative agency may cause the preparation of such

copies of such documentary material as may be required

for official use. While in the possession of the in­

vestigative agency, no material so produced shall be

available for examination and shall not be considered pub·

lie documents, without the consent of the party who pro­

duced such material, by an individual other than the

investigative agency. Under such reasonable terms and

conditions as the investigative agency shall prescribe,

documentary material while in the possession of the in­

vestigative agency shall be available for examination by

the party who produced such material or any duly authoriz

ed representatives of such party.

(c) Upon completion of the racketeering investiga-

tion for which any docwnentary material was produced unde

this subsection, and any case or proceeding arising from

such investigation; the investigative agency shall return

to the party who produced such material all such material

other than copies thereof made pursuant to this subsectio

which have not passed into the control of any court or

grand jury through introduction into the record of such

case or proceeding.

(d) When any documentary material has been produced

by any party under this section for use in any rackete­

ering investigation, and no case or proceeding arising

therefrom has been instituted within a reasonable time

after completion of the examination and analysis of all

evidence assembled in the course of such investigation,

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such party shall be entitled upon written demand made up

on the director of the investigative agency to the retun

of all docwnentary material, other than copies thereof

made pursuant to this section, so produced by such party.

(8) Whenever any person or enterprise fails to comply

any civil investigative demand duly served upon him under

section or whenever satisfactory copying or reproduction

8 of any such material cannot be done anc1 such party refuse�; to

9 surrender such material, the investigative agency may file, in

10 the circuit court for any county in which such party resides

11 or transacts business, and serve upon such party a petition

12 for an order of such court for the enforcement of this section,

13 except

14 county

15 party

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that if such person transacts business in more than one

such petition shall be filed in the county in which

maintains his principal place of business.

(9) Within 20 days after the service of any such demand

17 upon any person or enterprise, or at any time before the return

18 date specified in the demand, whichever period is shorter,

19 such party may file, in the circuit court of the county within

20 which such party resides or transacts business, and serve upon

21 the director of the investigative agency, a petition for an

22 order of such court modifying or setting aside such demand. Th

23 time allowed for compliance with the demand in whole or in

24 part as deemed proper and ordered by the court shall not run

25 during the pendency of the petjtion to the court. The petition

26 shall specify each ground upon which the petitioner relies in

27 seeking relief, and may be b�sed upon any failure of the demand

28 to comply with the provisions of this subsection or upon �ny

29 constitutional or legal right or privilege of the party.

30 (10) At any time during which the investigative agency s

31 in custody or control of any documentary material delivered by

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1 any party in compliance with any such demand, as party may file,

2 in the circuit court of the county where the documentary

3 material was delivered, and serve upon the investigative agency,

'1 a petition for an order of the court requiring the performance

5 of any duty imposed by this section.

6 (11) Whenever any petition is filed in any court under

7 this section the court shall have jurisdiction to hea.r and de-

8 termine the matter presented, and, after a hearing at which all

9 parties are represented, to enter orders required to carry

lO into effect the provisions of this subsection.

11

12 SECTION 2. If any provision of this act or the applica-

13 tion thereof to any person or circumstance is held invalid, the

14 invalidity shall not affect other provisions or applications of

15 the act which can.be given effect without the invalid provision

16 or application, and to this end the provisions of this act are

17 declared severable.18

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Section 1. Short Title--This act shall be known and may

be cited as the ''Racketeer Influenced and Corruput OrganizatiQ s

Act of 1977."

Section 2. Findings of Fact--The legislature of the Stat

of Florida finds that:

(1) Organized crime is a highly sophisticated, diversi-

fied, and widespread problem which annually drains billions of

dollars from the national economy by various patterns of un­

lawful conduct including the illegal use of force, fraud, and

corruption;

(2) Organized crime exists on a large scale within the

State of Florida, and it engages in the same patterns of un­

lawful conduct which characterize its activities nationally.

Seventeen of the twenty-one publicly identified organized

crime "families" are reported to operate within L"lor ida, c1.nd

becau!c;e no one family is considered by the others to have

dominion, Florida is considered an open state. Other organize

criminal elements are now migrating to Florida.

(3) The vast amounts of money and power accumulated by

organized crime are increasingly used to infiltrate and cor­

rupt legitimate businesses operating within this State, to­

gether with all of the techniques of violence, intimidation,

and other forms of unlawful conduct through which such money

and power are derived;

(4) In furtherance of such infiltration and corruption,

organized crime utilizes and applies to its unlawful purposes

laws of the State of Florida conferring and relating to the

privilege of engaging in various types of business and design­

ed to insure that such businesses are conducted in furtherance

of the public interest and the general economic welfare of the

State of Florida;

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( 5) Such infiltration and corruption provide an outlet

for illegally obtained capital, harm innocent investors,

entrepreneurs, merchants and consumers, interfere with free

competition, and thereby constitute a substantial danger to

the economic and general welfare of the State of Florida; and

( 6) In order to successfully resist and eliminate this

situation, it is necessary to provide new remedies and pro­

cedures.

Section 3. Definitions--As used in this act:

(1) "Racketeering activity" means to commit, to attempt

to commit, threaten or conspire to commit, or to coerce or

intimidate another person to commit:

(a) any act which is chargeable by indicement or infor-

mation under the following provisions of the Florida Statutes:

(1)

(2)

crimes).

s.210.18 (relating to evasion of cigarette taxes).

s.s.214.60-214.62 (relating to nonproperty tax

(3) s.409.325 (relating to public assistance fraud).

(4) Chapter 447 (relating to labor organizations).

(5) Chapter 448 (relating to general labor regulations).

(6) Chapter 501 (relating to deceptive and unfair trade

practices).

(7) Chapter 550 (relating to dog racing and horse

racing) .

(8) Chapter 551 (relating to jai alai frontons).

( 9) Chapter 562 (relating to beverage law enforcement).

(10) Chapter 687 (relating to interest and usurious

practices).

(11) Chapter 782 (relating to homicide).

(12) Chapter 787 (relating to kidnapping)

(13) Chapter 790 (relating to weapons and firearms).

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(14)

(15)

(16)

(17)

Chapter

Chapter

Chapter

Chapter

796

806

812

817

(relating to

(relating to

(relating to

(relating to

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prostitution).

arson) .

larceny and robbery).

fraudulent practices: fals,

pretenses and fraud generally and credit card crimes).

(18) Chapter 831 (relating to forgery and counterfeiting

(19) Chapter 832 (relating to issuance of worthless

checks and drafts).

(2 0) Chapter 836 (relating to defamation and extortion).

(21) Chapter 837 (relating to perjury).

(22) Chapter 838 (relating to bribery).

(23) Chapter 843 (relating to obstruction of justice).

(24) Chapter 847 (relating to obscene literature).

(25) Chapter 849 (relating to gambling) .

(26) Chapter 893 (relating to drug abuse prevention and

control).

(27) ss.918.12-918.14 (relating to tampering with jurors

evidence and wituesses).

(b) any act defined as racketeering activity under Title

18, United States Code, Section 1961 (J.) (b), (c), and (d). 'I'he

commission of an act as defined therein may be one of the acts

of racketeering activity used to establish a pattern of

racketeering activity under this Act.

(2) "Unlawful debt" shall mean any money or property con

stituting principle or interest of a debt that is legally un­

enforceable in whole or in part.

(a) because it was incurred or contracted in violation

of the following provision of the Florida Statutes:

(1)

(2)

( 3)

Chapter 786 (relating to interest and usery) .

Chapter 550 (relating to dog racing and horse

Chapter 5Sl (relating to jai alai. frontons).

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(4)

(b)

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Chapter 849 (relating to gambling); or

because it was incurred or contracted in gambling

activity in violation of the law of the United States or in the

business of lending money or a thing of value at a rate

usurious under Federal law.

( 3) "Enterprise" means any individual, sole proprietor-

ship, partnership, corporation, union chartered under the laws

of this state, or other legal.entity, or any unchartered union

association, or group of individuals associated in fact al­

though nof a legal entity.

( 4) "Pattern of racketeering activity" means the commis-

sion of at least two acts of racketeering activity, one of

which occurred after the effective date of this chapter and

the last of which occurred within four years after a prior act

of racketeering activity.

(5) "Documentary material" means any book, paper, docu-

ment, writings, drawings, graphs, charts, photographs, phono­

records, magnetic tapes, computer print-outs, and other data

compilations from which information can be obtained or from

which information can be translated into reasonably useable

form, or any other tangible item.

Section 4. Prohibited Activities--

(1) It shall be unlawful for any person who has received

any money or other thing of value derived, directly or in­

directly, from a pattern of racketeering activity or through

collection of an unlawful debt to use or invest, whether

directly or indirectly, any part of such money or thing of

value, or the proceeds derived from the investment or use ther -

of, in the acquisition of any title to, or any interest or

equity in real property, or the establishment or operation of

any enterprise in this State.

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( 2) It shall be unlawful for any person, through a pattern of

racketeering activity or through the collection of an unlawful

debt, to acquire or maintain, directly or indirectly, any in­

terest or control of any enterprise or real property in this

State.

(3) It shall be unlawful for any person employed by, or

associated with, any enterprise to conduct or participate,

directly or indirectly, in such enterprise through a pattern o._

racketeering activity or the collection of an unlawful debt.

(4) It shall be unlawful for any person to conspire or

attempt to violate any of the provisions of subsections (1),

(2), or (3) of this section.

Section 5. Criminal Penalties--

(1) Any person convicted of a violation of Section 4

shall be guilty of a felony of the third degree, punishable as

provided in s.775.082, s.77�.083, and s.775.084.

(2) Any person convicted of a violation of Section 4

shall forfeit to the State:

(a) any interest he has acquired or maintained in viola-

tion of Section 4; and

(bl any interest in, security issued by, claim against,

or property or contractual right that affords a source of in­

fluence over, any enterprise or real property which he has

owned, participated in, established, operated, controlled, or

conducted, in violation of Section 4.

(3) In any action broughtby the State under this section

the court shall enter such injunctions, or take such other

action, including, but not limited to, the acceptance of sat­

isfactory performance bonds, affecting any property or other

interest subject to forfeiture under this section, as it shall

deem proper.

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( 4) Upon conviction of a person under this act, the cour·

shall authorize the seizure of all property or other interest

declared forfeited. The State shall dispose of all forfeited

property as soon as commercially feasible, making due provisio

for the rights of innocent persons. If a property right or

other interest is not exercisable or transferable for value by

the State, it shall expire and shall not revert to the con­

victed person.

Section 6. Civil Remedies--

(1) The court may, after making due provision for the

rights of innocent persons, enjoin and restrain violations of

Section 4 by issuing appropriate orders including, but not

limited to:

(a) ordering any person to divest himself of any interes· ,

direct or indirect, in any enterprise or real property;

(b) imposing reasonable restrictions on the future

activities or invesbnents of any person, including but not

limited to, prohibiting any person from engaging in the same

type of endeavor as the enterprise in which he was engaged in

violation of Section 4;

(c) ordering the dissolution or reorganization of any

enterprise;

(d) ordering the suspension or revocation of licenses,

permits, or prior approval granted to any enterprise by any

department or agency of the State;

(e) ordering the forfeiture of the charter of a corpora-

tion organized under the laws of this State or the revocation

of a certificate authorizing a foreign corporation to conduct

business within this State upon finding that the board of di­

rectors or a managerial agent acting on behalf of the corpora­

tion has, in conducting the affairs of the corporation, pur-

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posely engaged in a pattern of racketeering activity and that

for the prevention of future criminal conduct of the same

character, the public interest requires the charter of the

corporation forfeited and the corporation dissolved or the

certificate revoked.

(2) hny state agency having jurisdiction over the allegel

racketeering activity may institute proceedings under this

section. In any action brought under this section, the circui_

court shall proceed as soon as practicable to the hearing and

determination thereof. Pending final determination, the

circuit court may at any time enter such injunctions, prohibi­

tions, or restraining orders, or take such actions, including

the acceptance of satisfactory performance bonds, as it shall

deem proper.

(3) Any person injured in his business or property by

reason of a violation of Section 4 of this act may sue there­

for in the circuit court and shall recover compensatory and

punitive damages, the court costs, and a reasonable attorney's

fee.

(4) A final judgment or decree rendered in favor of the

State in any criminal proceeding under this chapter shall esto

the defendant from denying the essential allegations of the

criminal offense in any subsequent civil proceedings brought

by the State.

(5) The imposition of a civil penalty under any provi-

sion of this sect.ion shall not preclude the imposition of any

other civil penalty (under this or any other section of the

Florida Statutes); civil remedies (under this act) are not

mutually exclusive.

Section 7. Civil Investigative Demand--

(1) For the purposes of this section "investigative

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agency'' shall mean that state agency having jurisdiction to

investigate violations of Section 4 as determined by the sub­

ject matter of the suspected racketeering activity.

(2) Whenever the investigative agency has reason to be-

lieve that any person or enterprise may be in possession,

custody, or control of any documentary material relevent to a

racketeering investigation, it may, prior to the institution

of a civil or criminal proceeding thereon, issue in writing,

and cause to be served upon such person, a civil investigative

demand requiring such person to produce such material for exam

ination.

(3)

(a)

Each such demand shall:

state the nature of the conduct constituting the al-

leged racketeering violation which is under investigation, the

provision of law applicable thereto and the connectioh between

the documentary material demanded and the conduct under invest -

gati.on;

(b) describe the class or classes of documentary materia.

to be produced thereunder with such definiteness and certainty

as to permit such material to be fairly identified;

(c) state that the demand is returnable forthwith or pre

scribe a return date which will provide a reasonable period

of time within which the material so demanded may be assembled

and made available for inspection and copying or reproduction;

(d) identify the person to whom such material shall be

made available;

(e) be authorized and signed by the agency director or

his formal delegate; and

(f) served by a designated representative of the in-

vestigative agency.

(4) No such demand shall:

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(a) contain any requirement which would be held to be

unreasonable if contained in a subpoena duces tecum issued by

any court in aid of a grand jury investigation of such alleged

violation of Section 4; or

(b) require the production of any documentary evidence

which would be privileged from disclosure if demanded by a

subpoena duces tecum issued by any court in aid of a grand jur

investigation of such alleged racketeering activity.

(5) Service of any such demand or any petition filed

under this section shall be made in the manner prescribed by

the Florida Rules of Civil Procedure for service of writs and

complaints.

(6) A verified return by the individual serving any such

demand or petition setting forth the manner of such service

shall be prima facie proof of such service. In the case of

service by registered or certified mail, such return shall be

accompanied by the return post office receipt of delivery of

such demand.

(7) Production and handling of documents.

(a) Any party upon whom any demand issued under this sec·

tion has been duly served shall make such material available

for inspection and copying or reproduction to the investigativ

agency at the principal place of business of such party, or at

such other place as such investigative agency and such party

thereafter may agree and prescribe in writing or as the court

may direct pursuant to this subsection, on the return date

specified in such demand, or on such later date as the in­

vestigative agency may prescribe in writing. The investigativ

agency may, with the permission of such party, take into its

possession the original copy of an� such material.

(bl The investigative ageucy to whom any documentary

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material is so delivered shall take physical possession there­

of, and shall be responsible for the use made thereof and for

its return pursuant to this section. The investigative agency

may cause the preparation of such copies of such documentary

material as may be required for official use. While in the

possession of the investigative agency, no material so produce

shall be available for examination and shall not be considered

public docume11ts, without the consent of the party who pro­

duced such material, by an individual other than the investi-

gative agency. Under such reasonable terms and conditions as

the investigative agency shall prescribe, documentary material

while in the possession of the investigative agency shall be

available for examination by the party who produced such

material or any duly authorized representatives of such party.

(c) Upon completion of the racketeering investigation

for which any documentary material was produced under this

subsection, and any case or proceeding arising from such in­

vestigation; the investigative agency shall return to the

party who produced such material all such material other than

copies thereof made pursuant to this subsection which have not

passed into the control of any court or grand jury through in­

troduction into the record of such case or proceeding.

(d) When any documentary material has been produced by

any party under this section for use in any racketeering in­

vestigation, and no case or proceeding arising therefrom has

been instituted within a reasonable time after completion of

the examination and analysis of all evidence assembled in the

course of such investigation, such party shall be entitled up­

on written demand made upon the director of the investigative

agency to the return of all documentary material, other than

copies thereof made pursuant to this section, so produced by

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such party.

(8) Whenever any person or enterprise fails to comply wi h

any civil investigative demand duly served upon him under this

section or whenever satisfactory coping or reproduction of any

such material cannot be done and such party refuses to surren­

der such material, the investigative agency may file, in the

circuit court for any county in which such party resides or

transacts business, and serve upon such party a petition for

an order of such court for the enforcement of this section,

except that if such person transacts business in more than one

county such petition shall be filed in the county in which

party maintains his principal place of business.

(9) Within 20 days after the service of any such demand

upon any person or enterprise, or at any time before the re­

turn date specified in the demand, whichever period is

shorter, such party may file, in the circuit court of the

county within which such party resides or transacts business,

and serve upon the investigative agency, a petition for an

order of such court modifying or setting aside such demand.

The time allowed for compliance with the demand in whole or in

part as deemed proper and ordered by the court shall not run

during the pendency of the petition to the court. The petitio

shall specify each ground upon which the petitioner relies in

seeking relief, and may be based upon any failure of the de­

mand to comply with the provisions of this subsection or upon

any constitutional or legal right or privilege of the party.

(10) At any time during which the investigative agency i

in custody or control of any documentary material delivered by

any party in compliance with any such demand, as party may

file, in the circuit court of the county where the documentary

material was delivered, and serve upon the investigative agenc ,

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a petition for an order of the court requiring the performance

of any duty imposed by this section.

(11) Whenever any petition is filed in any court under

this section the court shall have jurisdiction to hear and de­

termine the matter presented, and, after a hearing at which al

parties are represented, to enter orders required to carry in­

to effect the provisions of this subsection.

Section 8. If any provision of this act or the applica-

tion thereof to any person or circumstance is held invalid, th

invalidity shall not affect other provisions or applications o ..

the act which can be given effect without the invalid provisio.

or application, and to this end the provisions of this act are

declared severable.

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Journals of the

House of Representatives

ORGANIZATl,ON SESSION

and

FIRST REGULAR SESSION

of the

FIFTH LEGISLATURE [under the Constitution as Revised in 1968]

NOVEMBER 16, 1976

and

�©[?)W reproduced b:i,­

FLOAIDA STATE ARCHIVES DePAATMEN1" OF STA·rE

f:;t.A. GRAY BUIL0INr. T1>ll•h�••••. 1'1..,rl..ta 1�>!Q-.. '''

AP·RIL 5 through JUNE 3, 1977

[Including a record of transmittal of Acts subsequent to sine die adjournment]

May 2, 1977 JOURNAL OF THE HOUSE OF REPRESENTATIVES 405

·101:264,. 101.291, 10L30, 101.44, 101.5616, 101.60, 101.63, 101.­.691, and 101.70, Florida Statutes, which prescribe procedures and regulations with respect to voting, ballots, methods of qualifying for office, voting equipment, duties of election of­ficials, and adoption of provisions of election laws by certain agencies and political subdivisions; repealing- ss. 102.041 and102.051, Florida Statutes, which relate to powers of, and fillingof vacancies on, election boards; repealing ss. 103.041, 103.102,and 103.111, Florida Statutes, which relate to presidential elec­tors and prescribe regulations for political parties; repealingss. 104.021, 104.12, 104.14, 104.181, 104.25, 104.272, and 104.-28, Florida Statutes, which prescribe violations and penalties;repealing s. 104.35, Florida Statutes, which pi::ohibits the dis­tribution of literature against a candidate on election day; re­pealing ss. 104.44, 104.45, and 104.46, Florida Statutes, whichrepeal conflicting laws, authorize municipalities to adopt elec­.tion laws, and require a ·pamphlet and manual of such laws;repealing s. 105.021, Florida Statutes, which sets the datesof nonpartisan judicial elections; repealing ss. 106.10, 106.13, and 106.251, Florida Statutes, which relate to campaign fi­nancing- and enforcement of certain campaign financing viola­tions; repealing s. 1, chapter 75-246, Laws of Florida, whirhprescribes the dates for the second primary election; provid-ing- an effective date. ··

-was read the third time by title. On passage, the vote was:

Yeas-113

The Chair Adams Allen Andrews Barrett Batchelor Becker Bell Black Blackburn Bloom Boyd Brown Burnsed Burrall Carlton Cassens Cherry Conway Cox Craig Crawford Crenshaw Culbreath Danson Dixon Dyer Easley Eckhart

Nays-1

Maxwell

Evans Ewing :B'ontana Forbes Fortune Foster Fox Frank Fulford Gallagher Girardeau Gordon Grizzle Grosse Gustafson Haben Hagler Hattaway Hawkins Hazelton Hazouri Healey Hector Hieber Hill Hodes Hodges Hollingsworth ·Hutto

Votes after roll call:

James Jennings Kershaw Kirkwood Kiser Kutun Langley Lehman Lewis,J. W. Lewis, T. Lockward Malloy Mann llfar_g-olis Martin McCall McDonald McKnight McPherson Melvin Mica Mixson Moffitt Moore, R. Moore, T. Morgan Neal Nelson Nuckolls

Yeas-Considine, Gersten, Fechtel

Ogden O'Mal!ey Pajcic' Patchett Patterson Poindexter Poole Ready Redman Richard Richmond Rish Robinson Ryals Sadowski Sample Sheldon Smith Steinberg Tavlor · Thompson Ward Warner Williams Woodruff Young

So the bill passed, as amended. On motion by Mr. Kershaw, the rules were waived and the bill was immediately certified to the Senate.

THE· -SPEAKER PRO TEMPORE IN THE CHAIR

. •Consideration of the Special and Continuing Order

RB 2127-A bill to be entitled An act relating to organized crime; making it unlawful to use or invest any money or thing of value derived from a pattern of racketeering activity in the acquisition of any title to, right, interest, or equity in real property or enterprise in this state; making- it unlawful to acquire or maintain an interest in real property or an enter­prise through a pattern of racketeering activity or the collec-

. tion of an unlawful debt; making it un]av;rful -to conduct 'or

participate· in any enterprise through a pattern of racketeering activity or through the collection of an unlawful debt; making it unlawful to conspire or attempt to commit such prohibited activities; providing penalties.; pi:oviding for the forfeiture of any interest in, security issued by, claim against, or property or contractual right affording influence or control over any such · enterprise or real property; providing for injunction, seizure, and state disposal of seized and forfeited property; J?roviding for the rights of innocent parties; providing civil remedies of divestiture, reasonable restrictions on future activi­ties, dissolution or reorganization of any enterprise, revoca­tion or suspension of. licenses or permits, and forfeiture of cor­poration charter or revocation of certificate authorizing a for­eign corporation to conduct business within this state; pro­viding for civil cause of action for any person injured as a result of another's violation of the prohibited conduct; -pro­viding for civil investigative demand for any agency having jurisdiction to investigate as a crime or as a violation of state regulatory 1aws or rules; providing procedures for using civil investigative demand and identifying who may use same; providing for the confidentiality of documentary material pr.oduced under a civil investig-ative demand and for the re­turn or disposal of such material after the conclusion of such investigation; providing severability; providing an effective date.

-was read the second time by title.

Representatives Nelson, Smith, and Richard offered the fol­lowing amendment:

Amendment 1-0n page 15, line 9, strike "Section 8. This act shall take effect October 1, 19177." and insert: Section 8. Section 905.34, Florida Statutes, is amended to read:

905.34 Powers and duties; law applicable.-The jurisdiction of a statewide grand jury impaneled under this chapter shall extend throughout the state. The subject matter jurisdiction of the statewide grand jury shall be limited to the offenses of bribery, burglary, criminal fraud, criminal usury, extortion, gambling, kidnapping, larceny, murder, prostitution, perjury, robbery, IHl-4 crimes involving narcotic or other dangerous drugs, and any violation of the provisions of the Florida RICO(Racketeer Influenced-and Corrupt _Organization Act), or any attempt, solicitation, or conspiracy to commit any violation of the crimes specifically enumerated above, when any such of­fense is occurring, oi: has -occurred, in two or more counties as part of a related transaction, or when any such offense is connected with an organized criminal conspiracy affecting two or more counties. The statewide grand · jury may return indictments and presentments irrespective of the county or judi­cial circuit where the offense is committed or triable. If an in­dictment is returned, it shall be certified and transferred· for trial to the county where the offense was committed. The powers and duties of, and· law applicable to, county grand juries shall apply to a statewide grand jury except when such powers, duties, and law are incons.istent with the provisions of ss. 905.31-905.40.

Section 9. This act sh_all take effect October 1, 1977.

·Mr. Nelson moved the adoption of the amendment, whichwas adopted.

Representatives Nelson, Smith, and Richard offered the fol­lowing title amendment:

Amendment 2-0n page 2, line 13, after "severability;" in­sert: amending section 905.34, Florida Statutes, to extend the subject matter _jurisdiction of the statewide grand jury to include violations of this act;

Mr. Nelson moved the adoption of the amendment, which was adopted .

Under Rule' 8:19, the bill was referred to . the Engrossing Clerk:

THE SPEAKER IN THE CHAIR

HB 198-A -_bill -to be-entitled An act relating tq the Bever­age Law; amending s. 561.25, Flo-rida Statutes, relating to the prohibition against law enforcement officers and certain em­ployees- · engaging · in 'business 'related to the ·sale · of alcoholic

846 JOURNAL OF THE HOUSE OF REPRESENTATIVES May 30, 1977

On motion by Mr. Nelson, the· rules were waived and the House reverted to the order of-

Messages from the Senate

The Honorabl� Donald L. Tucker, Speaker

I am directed to inform the House of Representatives that the Senate has pi:.ssed with amendments-

By the Committee on Criminal Justice, the Select Committee on Organized Crime and Representatives Nelson and others-

HB 2127-A bill to be entitled An act relating to organized crime; making it unlawful to use or invest any money or thing of value derived from a pattern of racketeering activity in the acquisition of any title to, right, interest, or equity in real property or enterprise in this state; making it unlawful to acquire or maintain an interest in real property or an enterprise through a pattern of racketeering activity or the collection of an unlawful debt; making it unlawful to conduct or participate in any enterprise through a pattern of racketeering :lctivity or through the collection of an unlawful debt; making it un­lawful to conspire or attempt to commit such prohibited activi­ties; providing penalties; providing for the forfeiture of any interest in, security issued by, claim against, or property or contractual right affording influence or control over any such enterprise or real property; providing for injunction, seizure, and state disposal of seized and forfeited property; providing for the rights of innocent parties; providing civil remedies of divestiture, reasonable restrictions on future activities, dissolu­tion or reorganization of any enterprise, revocation or suspen­sion of licenses or permits, and forfeiture of corporation charter or revocation of certificate authorizing a foreign corporation to conduct business within this state; providing for civil cause of action for any person injured as a result of another's viola­tion of the prohibited conduct; providing for civil investigative demand for any agency having jurisdiction to investigate as a crime or as a violation of state regulatory laws or rules; pro­viding procedures for using civil investigative demand and iden­tifying who may use same; providing for the confidentiality of documentary material produced under a civil investigative de­mand and for the return or disposal of such material after the conclusion of such investigation; providing severability; amend­ing section 905.34, Florida Statutes, to extend the subject matter jurisdiction of the statewide grand jury to include violations of this act; providing an effective date.

-and requests the concurrence of the House therein.

Joe Brown, Secretary

Senate Amendment 1-On page 3, strike everything after the enacting clause and insert:

Section 1. Short title.-Sections 1 through 7 of this act shall be known as the Florida RICO (Racketeer Influenced and Cor­rupt Organization) Act.

Section 2. Definitions.-As used in this act:

(1) "Racketeering activity" means to commit, to attemptto commit, to conspire to commit, or to solicit, coerce, or in­timidate another person to commit:

(a) Any crime which is chargeable by indictment or in­formation under the following provisions of the Florida Stat­utes:

1. Section 210.18, Florida Statutes, relating to evasion ofpayment of cigarette taxes.

2. Section 409.325, Florida Statutes, relating to public as­sistance fraud.

3. Chapter 517, Florida Statutes, relating to sale of securities.

4. Sections 550.24, 550.35, 550.36, Florida Statutes, relatingto dog racing and horse racing.

5. Section 551.09, Florida Statutes, relating to jai alaifrontons.

6. Chapter 552, Florida Statutes, relating to manufacture, distribution, and use of explosives.

7. Chapter 562, Florida Statutes, relating to beverage law enforcement.

8. Chapter 687, Florida Statutes, relating to interest and usurious practices.

9. Chapter 782, Florida Statutes, relating to homicide.

10. Chapter 784, Florida Statutes, relating to assault and battery.

11. Chapter 787, Florida Statutes, relating to kidnapping.

12. Chapter 790, Florida Statutes, relating to weapons andfirearms.

13. Sections 796.01, 796.03, 796.04, 796.05, 796.07, Florida Statutes, relating to prostitution.

14. Chapter 806, Florida Statutes, relating to arson.

15. Chapter 812, Florida Statutes, relating to larceny, rob­bery, and related crimes.

16. Chapter 817, Florida Statutes, relating to fraudulent practices, false pretenses, fraud generally, and credit card crimes.

17. Chapter 831, Florida Statutes, relating to forgery and counterfeiting.

18. Chapter 832, Florida Statutes, relating to issuance ofworthless checks and drafts.

19. Chapter 837, Florida Statutes, relating to perjury.

20. Chapter 838, Florida Statutes, relating to bribery and misuse of public office.

21. Chapter 843, Florida Statutes, relating to obstruction ofjustice.

22. Sections 847.011, 847.012, 847.013, 847.06, 847.07, Florida Statutes, relating to obscene literature and profanity.

23. Sections 849.09, 849.14, 849.15, 849.23, 849.24, 849.25, Florida Statutes, relating to gambling.

24. Chapter 893, Florida Statutes, relating to drug abuse prevention and control.

25. Sections 918.12-918.14, Florida Statutes, relating totampering with jurors, evidence, and witnesses.

(b) Any conduct defined as "racketeering activity" under Title 18, United States Code, Section 1961(1) (A),(B),(C), and (D).

(2) "Unlawful debt" means any money or other thing ofvalue constituting principal or interest of a debt that is legally unenforceable in the State of Florida in whole or in part be­cause the debt was incurred or contracted:

(a) In violation of any one of the following provisions oflaw:

1. Sections 550.24, 550.35, 550.36, Florida Statutes, relating to dog racing and horse racing.

2. Section 551.09, Florida Statutes, relating to jai alai frontons.

3. Chapter 687, Florida Statutes, relating to interest andusury.

4. Sections 849.09, 849.14, 849.15, 849.23, 849.24, 849.25, Florida Statutes, relating to gambling.

(b) In gambling activity in violation of federal law or in the business of lending money at a rate usurious under state or federal law.

(3) "Enterprise" means any individual, sole proprietorship, partnership, corporation, business trust, union chartered under the laws of .this state, or other legal entity, or any unchartered union, association, or group of individuals associated in fact although not a legal entity, and it includes illicit as well as licit enterprises and governmental as well as other entities.

(4) "Pattern of racketeering conduct" means engaging in at least two incidents of racketeering conduct that have the same or similar intents, results, accomplices, victims, or meth­ods of commission, or otherwise are interrelated by distinguish-

May 30, 1977 JOURNAL OF THE HOUSE OF REPRESENTATIVES 847

in.,. characteristics and are not isolated incidents, provided at Je;st one of such incidents occurred after the effective date of this act and that the last of such incidents occurred within 5 years after a prior incident of racketeering conduct.

(5) "Documentary material" means any book, paper, docu­ment, writing, drawing, graph, chart, photograph, phonorecord, magnetic tape, computer print-out, any other data compilation from which information can be obtained or from which infor­mation can be translated into useable form, or any other tan­gible item.

Section 3. Prohibited activities and defense.-(1) (a) It is unlawful for any person who has with crim­

inal intent received any proceeds derived, directly or indirectly, from a pattern of racketeering activity or through the collec­tion of an unlawful debt to use or invest, whether directly or indirectly, any part of such proceeds; or the proceeds de­rived from the investment or use thereof, in the acquisition of any title to, or any right, interest, or equity in real property, or the establishment or operation of any enterprise.

(b) It is an affirmative defense if the proceeds were usedto purchase securities of such enterprise on the open market without a purpose to control or participate in the control of such enterprise, or to assist another person to do so, if the securities of the purchaser, the members of his immediate family, and his or their accomplices in any pattern of racketeer­ing conduct after such purchase do not confer, either in law or in fact, the power to elect one or more directors of such enter­prise. The person asserting such defense bears the burden of proof.

(2) It is unlawful for any person, through a pattern ofracketeering activity or through the collection of an unlawful debt, to acquire or maintain, directly or indirectly, any in­terest in or control of any enterprise or real property.

. (3) It is unlawful for any person employed by, or asso­ciated with, any enterprise to conduct or participate, directly or indirectly, in such enterprise through a pattern of racketeer­ing activity or the collection of an unlawful debt.

(4) It is unlawful for any person to conspire· or endeavorto violate any of the provisions of subsections (1), (2), or (3).

Section 4. Criminal penalties and alternative fine.-. (1) Any person convicted of engaging in activity in viola­

t(on of the provisions of section 3 is guilty of a felony of the first degree, and shall be punished as provided in s. 775.082, s. 775.083, or s. 775.084, Florida Statutes.

(2) Ir_i lieu of a fine otherwise authorized by law, any per­S<;Jf: convicted of engaging in conduct in violation of the pro­v1s1ons of_ section 3 through which he derived pecuniary value, or by which he caused personal injury or property damage or other l�ss, may be sentenced to pay a fine that does not exceed three times the gross value gained or three times the gross loss caused, whichever is the greater, plus court costs and the costs of investigation and prosecution, reasonably incurred.

(3) The court _ shall hold a hearing to determine the amountof the fme author1zed by subsection (2).

(4) For the purposes of subsection (2), "pecuniary value"means: ;

. (a) Anything of value in the form of money, a negotiable 1r_ist�u!Ilent, a commercial interest, or anything else the primary s1gmficance of which is economic advantage; or

(b) Any other property or service that has a value in excessof $100. Section 5. Civil remedies.-(1) A_ny circu_it court may, after making due prov1s1ons

f?r. the r1ghts �f mnocent persons, enjoin violations of the pro­visions_ of sect10n 3 by issuing appropriate orders and judg­ments mcludmg, but not limited to:

t (a) . Ordering any defendant to divest himself of any in­

erest m any enterprise, including real property;

t· (b) �mposing reasonable restrictions upon the future activi­ies or Investments of any defendant, including but not limited

to, prohibiting any defendant from engaging in the same type

of endeavor as the enterprise in which he was engaged in viola­tion of the provisions of section 3;

(c) Ordering the dissolution or reorganization of any enter­prise;

(d) Ordering the suspension or revocation of license, permit,or prior approval granted to any enterprise by any agency of the state;

(e) Ordering the forfeiture of the charter of a corporationorganized under the laws of the State of Florida or the revoca­tion of a certificate authorizing a foreign corporation to con­duct business within the State of Florida upon finding that the board of directors or a managerial agent acting on behalf of the corporl;ltion, in conducting the affairs of the corporation, has authorized or engaged in conduct in violation of section 3and that for the prevention of future criminal activity, the public interest requires the charter of the corporation forfeited and the corporation dissolved or the certificate revoked.

(2) All property, real or personal, including money, used in the course of, intended for use in the course of, derived from, or realized through conduct in violation of a provision of this act is subject to civil forfeiture to the State of Florida. The State of Florida shall dispose of all forfeited property as soon as commercially feasible. If property is not exercisable or transferable for value by the State of Florida, it shall expire. All forfeitures or dispositions under this section shall be made with due provision for the rights of innocent persons. The pro­ceeds realized from such forfeiture and disposition shall be promptly deposited in the treasury of the State of Florida and immediately credited to the general revenue fund of the state.

(3) Property subject to forfeiture under this section may be seized by a law enforcement officer upon court process. Seizure without process may be made if:

(a) The seizure is incident to a lawful arrest or search or aninspection under an administrative inspection warrant; or

(b) The property subject to seizure has been the subjectof a prior judgment in favor of the State of Florida in a for­feiture proceeding based upon this section.

(4) In the event of a seizure under subsection (3), a for­feiture proceeding shall be instituted promptly. Property taken or detained under this section ·shall not be subject to replevin, but is deemed to be in the custody of the law enforcement offi­cer making the seizure subject only to the order of the court. When property is seized under this section pending forfeiture and final disposition, the law enforcement officer may:

(a) Place the property under seal;(b) Remove the property to a place designated by court;

or (c) Require another agency authorized by law to take

custody of the property and remove it to an appropriate loca­tion.

(5) The State Attorney General, any State Attorney or anystate agency having jurisdiction over conduct in violation of a provision of this act may institute civil proceedings under this section. In any action brought under this section, the circuit court shall proceed as soon as practicable to the hearing and determination. Pending final determination, the circuit court may at any time enter such injunctions, prohibitions, or re­straining orders, or take such actions, including the acceptance of satisfactory performance bonds, as the court may deem proper.

(6) Any aggrieved person may institute a proceeding undersubsection (1). In such proceeding, relief shall be granted in conformity with the principles that govern the granting of in­junctive relief from threatened loss or damage in other civil cases, provided that no showing of special or irreparable dam­age to the person shall have to be made. Upon the execution of proper bond against damages for an injunction improvidently granted and a showing of immediate danger of significant loss or damage, a temporary restraining order and a preliminary injunction may be issued in any such action before a final de­termination on the merits.

(7) Any person who is injured by reason of any violation of the provisions of section 3 shall have a cause of action for three-fold the actual damages sustained and, where appropriate,

848 JOURNAL OF THE HOUSE OF REPRESENTATIVES May 30, 1977

punitive damages. Such person shall also recover attorneys' fees in the trial and appellate courts, and costs of investigation and litigation, reasonably incurred.

(a) The defendant or any injured person may demand atrial by jury in any civil action brought pursuant to this section.

(b) Any injured person shall have a right or claim to for­feited property or to the proceeds derived therefrom superior to any right or claim the state has in the same property or proceeds.

(8) A final judgment or decree rendered in favor of the State of Florida in any criminal proceeding under this act shall estop the defendant in any subsequent civil action or proceed­ing as to all matters which such judgment or decree would be an estoppel as between the parties.

(9) The Attorney General may, upon timely application, in­tervene in any civil action or proceeding brought under sub­sections (6) or (7) if he certifies that in his opinion the action or proceeding is of general public importance. In such action or proceeding, the State of Florida shall be entitled to the same relief as if the Attorney General had instituted this action or proceeding.

(10) Notwithstanding any other provision of law, a criminal or civil action or proceeding under this act may be commenced up until 5 years after the conduct in violation of a provision of this act terminates or the cause of action accrues. If a criminal prosecution, civil action or other proceeding is brought, or in­tervened in, to punish, prevent, or restrain any violation of the provisions of this act, the running of the period of limita­tions prescribed by this section with respect to any cause of action arising under subsections (6) or (7) which is based in whole or in part upon any matter complained of in any such prosecution, action or proceeding shall be suspended during the pendency of such prosecution, action or proceeding and for two years following its termination.

(11) The application of one civil remedy under any provisionof this act shall not preclude the application of any other reme­dy, civil or criminal, under this act or any other provision of law. Civil remedies under this act are supplemental and not mutually exclusive.

Section 6. Section 905.34, Florida Statutes, is amended to read:

905.34 Powers and duties; law applicable.-The jurisdiction of a statewide grand jury impaneled under this chapter shall extend throughout the state. The subject matter jurisdiction of the statewide grand jury shall be limited to the offenses of bribery, burglary, criminal fraud, criminal usury, extortion, gamblin·g, kidnapping, larceny, murder, prostitution, perjury, robbery, any violation of the provisions of the Florida RICO (Racketeer Influenced and Corruvt Organization) Act, and crimes involving narcotic or other dangerous drugs, or any attempt, solicitation, or conspiracy to commit any violation of the crimes specifically enumerated above, when any such of­fense is occurring, or has occurred, in two or more counties as part of a related ·transaction, or when any such offense is connected with an organized criminal conspiracy affecting two or more counties. The statewide grand jury may return indictments and presentments irrespective of the county or judi­cial circuit where the offense is committed or triable. If an indictment is returned, it shall be certified and transferred for trial to the county where the offense was committed. The powers and duties of, and law applicable to, county grand juries shall apply to a statewide grand jury except when such powers, duties, and law are inconsistent with the provisions of ss. 905.-31-905.40.

Section 7. If any provision of this act or the application of it to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the act that can be given effect without the invalid provision or application, and to this end the provisions of this act are declared sever­able.

Section 8. This act shall take effect October 1, 1977.

Senate Amendment 2--Strike the title and insert: A bill to be entitled An act relating to organized crime; making it unlawful to use or invest proceeds from a pattern of racketeering conduct or from the collection of an unlawful debt to acquire or maintain

an interest in, or to establish or conduct an enterprise, including real property; providing an affirmative defense; making it unlawful to acquire or maintain an interest in, or to conduct an enterprise or acquire real property, through a pattern of racketeering conduct or through the collection of an unlawful debt; making it unlawful to conspire or endeavor to engage in such conduct; providing criminal penalties; providing an alternative fine; providing for the rights of innocent persons; providing civil remedies of divestiture, reasonable restrictions on future activities, dissolution or reorganization of any enter­prise, revocation or suspension of licenses or permits, and forfeiture of corporation charter or revocation of certificate authorizing a foreign corporation to conduct business within this state; providing for seizure and state disposal of seized and forfeited property; providing that any aggrieved person may institute civil proceedings to seek treble damages, attor­ney's fees, and punitive damages; providing for right to jury trial; providing for priority of claim; amending s. 905.34, Florida Statutes; extending the subject matter jurisdiction of the state wide grand jury to include violations of this act; providing severability; providing an effective date.

Representatives Nelson and Richard offered the following amendment to Senate Amendment 1:

House Amendment 1 to Senate Amendment 1-On page 5, strike lines 2-11

Mr. Nelson moved the adoption of the amendment to the amendment, which was adopted.

Representatives Nelson and Richard offered the following amendment to Senate Amendment 1:

House Amendment 2 to Senate Amendment 1-On page 4, line 11, strike "conduct" and insert: activity

Mr. Nelson moved the adoption of the amendment to the amendment, which was adopted.

Representative Nelson offered the following amendment to Senate Amendment 2:

House Amendment 1 to Senate Amendment 2-In title, strike "providing an affirmative defense"

Mr. Nelson moved the adoption of the amendment to the amendment, which was adopted.

On motions by Mr. Nelson, the House concurred in Senate Amendments 1 and 2 as amended by House amendments. The ques�ion recurred on the passage of HB 2127. The vote was:

Yeas-99

The Chair Adams Allen Barrett Batchelor Bell Black Blackburn Bloom Boyd Brown Burnsed Burrall Carlton Cassens Considine Conway Cox Craig Crawford Crenshaw Culbreath Danson Davis Dyer

Nays-None

Eckhart Ewing Fechtel Fontana Forbes Fortune Foster Fox Frank Fulford Girardeau Grizzle Gustafson Haben Hagler Hattaway Hawkins Hazouri Healey Hieber Hill Hodes Hodges Hollingsworth Hutto

Votes after roll call:

James Jennings Jones Kershaw Kirkwood Kiser Kutun Langley Lehman Lewis,J. W. Malloy Mann Martin McCall McDonald McKnight Melvin Mica Mixson Moffitt Moore, R. Moore, T. Morgan Nelson Ogden

O'Malley Pajcic Patchett Patterson Poindexter Poole Ready Redman Richard Richmond Rish Robinson Ryals Sadowski Sample Sheldon Smith Steinberg Taylor Thompson Ward Warner Williams Woodruff

Yeas-Gallagher, Lockward, Hector, Hazelton, Becker

May 30, 1977 JOURNAL OF THE HOUSE OF REPRESENTATIVES 849

So the bill passed, as further amended. The action, together with the bill and amendments thereto, was immediately certified to the Senate.

The Honorable Donald L. Tucker, Speaker I am directed to inform the House of Representatives that

the Senate has concurred in House Amendment 1; has refused to concur in House Amendment 4 and requests the House to recede; has amended House Amendments 2 and 3, concurred in same as amended and passed SB 553, as amended,

By Senator Lewis (by request) and others-SB 553-A bill to be entitled An act relating to the Ad­

ministrative Procedures Committee; adding paragraph (i) to s. 11.60(2), Florida Statutes, to grant standing to the commit­tee to seek judicial review of the validity or invalidity of cer­tain administrative rules and to authorize the expenditure of public funds therefor; providing an effective date.

and requests the concurrence of the House. Joe Brown, Secretary

House Amendment 4---On page 1, line 13, strike all of lines 13 through 17 and insert:

Section 1. Paragraph (e) of subsection (2) of section 11.60 Florida Statutes, is amended and paragraph (i) is added to said subsection to read:

11.60 Administrative Procedures Committee; creation; mem­bership; powers; duties.-

(2) The committee shall:

(e) Report to the legislature at least annually, no later than the first week of the regular session and recommend needed legislation or other appropriate action.' The report shall include but_ not be limited to, a listing of agency rules and regulation; which establish standards more ?"estrictive than federal stand­ards.

. House Amendment 2-On page 1, lines 25 & 26, strike all of Imes 25 and 26 and insert:

Section 2. Paragraph (c) of subsection (14) of section 120.52, Florida Statutes, 1976 Supplement, is amended to read:

120.52 Definitions.-As used in this act: (�1) "Rul�" means each agency statement of general appli­

cability �hat implements, interprets, or prescribes law or policy or describes the organization, procedure, or practice require­ments of an agency and includes any form which imposes any reqmrement or solicits any information not specifically re­qmred by statute or by an existing rule. The term also in­�ludes the amendment or repeal of a rule. The term does not mclude:

(c) The preparation or modification of: 1. Agency budgets.

2. Contractual provisions reached as a result of collectivebargaining.

3. Agricultural marketing orders under chapter 573 or chap­ter 601.

4. Curriculum by an educational unit. Section 3. Paragraph (a) of subsection (9) and subsections

(11) and (12) of section 120.54, Florida Statutes, 1976 Supple­ment, are amended to read:

120.54 Rulemaking; adoption procedures.-(9) (a) If an agency finds that an immediate danger to the

public health, safety, or welfare requires emergency action, the agency may adopt any rule necessitated by the immediate dan­ger by any procedure which is fair under the circumstances and necessary to protect the public interest, provided that:

1. The procedure provides at least the procedural protec­tion given by other statutes the Florida Constitution, or the United States Constitution. '

2. The agency takes only that action necessary to protectthe public interest under the emergency procedure.

3. The agency publishes in writing at the time of, or priorto, its action the specific facts and reasons for finding an im­mediate danger to the public health, safety, or welfare and its reasons for concluding that the procedure used is fair under the circumstances. In any event, notice of emergency rules, other than those of educational units or units of government with jurisdiction in only one county or a part thereof, shall be published in the first available issue of the Florida Adminis­trative Weekly. The agency's findings of immediate danger, necessity, and procedural fairness shall be judicially reviewable.

(11) (a) The adopting agency shall file with the committeea copy of each rule it proposes to adopt, a detailed written statement of the facts and circumstances justifying the pro­posed rule, a copy of the estimate of economic impact required by subsection (1), and the notice required by subsection (1) at least 21 days prior to the proposed adoption date. After the final public hearing on the proposed rule, or after the time for requesting a hearing has expired, the adopting agency shall file any changes in the proposed rule and the reasons therefor with the committee or advise the committee that there are no changes. This paragraph shall not apply to educational units other than units of the State University System, to local units of government with jurisdiction in only one county or a part thereof, or to emergency rules adopted pursuant to subsection [ (9)]. However, agencies, other than those listed herein, adopting emergency rules shall file a copy of each emergency rule with the committee.

(b) If the adopting agency is required to publish its rulesin the Florida Administrative Code, it shall file three certified copies of the rule it proposes to adopt, a summary of the rule, a summary of any hearings held on the ntle, and a de­tailed written statement of the facts and circumstances justi­fying the rule with the Department of State. Agencies not re­quired to publish their rules in the Florida Administrative Code shall file one certified copy of the proposed rule and the other material required above in the office of the agency head, and such rules shall be open to the public pursuant to s. 120.53(2). Filings shall be made not less than 21 days nor more than 45 days after the notice required by subsection (1) if no public hearing is held. If a public hearing is held,the adopting agency shall file within 21 days after receipt of all material authorized to be submitted at the hearing or rec§ipt of the transcript, if one is made, whichever is later. Net te56 thiffi 2-1 4a-r-; er HI- ta&'t 4-a d&:f!l afte¥ � �ee i'e€fUH'ed b:l' ffii�t.j.en fB, * fl� ffiel'e tfiln't J.4 � ai-!;e¥ <Ike e-eRe±lliliei'I ef the fo,al � �g, * tile �g e,;te�e beyene the 4-f> da-y-5; too ad� ag<IBey; 44 it ffi �--e�1;�,'00 ;a l,ffibl-iE� its i,u!ea m �e F.Joma AdmiHistffi.twe Go-ae; eheJ! f.i-te wi-t-1½ the flepa¥tmefl-t ef ,S-!;&te t!H>ee ee¥tifi€d e� ef the RI� .j.t f1¥e-J396eB te ad9fl'I;; a su-mn1afj' ef the ¥U-le; a eHmmafj' ef B.,f!3/ h� �d e19, tlw i'W� aH-d a cl�J.ed w-� etatemeF.t ef -the fact.,, a-mi ei-reumsk,nae.; fHstifyiR-g a i,� Aga.cIBS Rat i'e€ftl+.!'6d te f)-Uhli-&f> � i'i¼les ffi the l'clorida Aclm-:nia:pa:4ve Gede � H!e aH the £:ee>re � with the Depal"tmeHt ef ,State, e,;cept tha.t EH'l+:f ef!€ -t+£.ed eGi}-J' ef tfle Jl-?6� 'A¾-!e s�l � file4,

(12) The proposed rule shall be adopted on being filedwith the Department of State and become effective 20 days after being filed, on a later date specified in the rule, or on a date required by statute. Rules not filed with the Department of State shall become effective when adopted by the agency head or on a later date specified by rule or statute. After the notice required in subsection (1) and prior to adoption, the agency may withdraw the rule by publishing a notice in the Florida Administrative Weekly and notifying the Department of State, and may make such changes in the rule as are sup­ported by the record of public hearings held on the rule, technical changes which do not affect the substance of the rule, or changes in response to a proposed objection by the committee. Changes supported by the record of a hearing or made in response to a proposed committee objection may in­clude withdrawal of the rule in whole or in part. After adop­tion and before the effective date, a rule may be modified or withdrawn only in response to an objection by the committee or may be modified to extend the effective date by not more than 60 days when the committee has notified the agency that an objection to the rule is being considered. After a rule has become effective, it may be repealed or amended only through regular rulemaking procedures.

�(Q)[p)'tr7 reproduc;?d by FLORIDA STATE ARCHIVESDEPARTMENT OF STATE A.A GRAY BUILDIN'"' Tallah_assee Florida 323i1-02soSeries_ Carton� File Folder

FLORIDA. HOUSE OF REPRESENTATIVES -

Ralph H. Haben, Jr. Chairman

Barry Richard Vice Chairman

MEMORANDUM

DONALD L. TUCKER, Speaker/JOHN L. RYALS, Speaker Pro Tempore

COMMITTEE ON CRIMINAL JUSTICE

March 30, 1977

TO: Members, Subcommittee II

FROM: Karl R. Adams, Staff Director Committee on Criminal Justice

SUBJECT: Proposed Committee Bill Relating to Organized Crime

Although my memorandum of March 23, 1977 indicated that the latest Senate version of the organized crime - anti-racketeering bill would be available for distribution at this time, it has been un­avoidably delayed.

Consequently, before you, for the purposes of discussion, is the Senate draft which was considered at the March meeting of the Senate Committee on Judiciary-Criminal.

KRA/nra

R. Ed Blackburn. Jr. Fred Bun-all Robt!rt B. Crawford A. M. Fontana Joseph M. Gersten Curtis S. Kiser David J. Lehman C. William Nelson

Van B. Poole Eric Smith Karl R. Adams, Staff Direct.or

1,

11

12

13

H

15

11.

17

18

19

20

21

11

2)

2l

2S

16

11

28

29

30

31

10-;60-7

A bill to be entitled

An act relating to organized crime1 making it

unlawful to use or inves� any money or thing of

value derived from a pattern of racketeering

activity in the acquisition of any title to,

right, intereJt, or equity in real property or

enterprise in this state;,maklng it unlawful to

acquire or maintain an interest in real

property or an enterprise through a pattern of

racketeering activity or the collection of an

unlawful debt1 making it unlawful to conduct or

participate in any enterprise through a pattern

of racketeering activity or through the

collection of an unlawful debt1 making it

unlawful to conspire or attempt to commit such

prohibited activities; providing pcnalties1

providing fvr the forfeiture of any interest

in, security issued by, claim against, or

property or contractual right affording

influence or control over any such enterprise

or real property1 providing for injunction,

seizure and state di&posal of seized and

forfeited property1 providing for the rights of

innocent parties; providing civil remedies of

divestiture, reasonable restrictions on future

activities, dissolution or reorganization of

any enterprise, revocation or suspensions of

licenses or permits, and forfeiture of

corporation charter or revocation of

certificate authorizing a foreign corporation

to conduct business within this state;

l

CODIUC: """'.:" 111 ��,I.. ,�._.i'- ty"p� e,.i cicl"tion, f,o,n c•htin9 law; ""'o,d, 1!.!?htlin..£..4.ort addition,.

10

11

12

ll

I◄

u

16

10.-643-7

providing for ci�il cause of action for any

person injured as a result of another's

violation of the prohibited conduct1 providing

for civil investigative demand for any agency

having jurisdiction to investigate as a crime

or as a violation of state regulatory laws or

rules1 providing procedur-cs for using civil

investigative demand and identifying who may

use same1 providing for the confidentiality of

documentary material produced under a civil

investigative demand and for the return or

disposal of such material after the conclusion

of such investigation; providing severability1

providing an effective date.

WHEREAS, the Leg i sla tu re finds that organlz ed er ime is

17 a highly sophisticated, dive�sified, and widespread problem

18 which annually drains billions of dollars from the national

19 economy by various patterns of unlawful conduct, including the

20 illegal use of force, fraud, and corruption, and

21 WHEREAS, organized er ime exists on a large scale within

n the State of Florida, and it engages in the same patterns of

)3 unlawful conduct which characterize its activities in other

241 states, and

2S WHERE�S, seventeen of the twenty-one publicly

M identified orgaQized crime "families" are reported to operate

21 within Florida, and because no single "family" is considered

n by the other "families• to have exclusive dominion in the

29 state, Florida is considered by organized criminal op�ratives

JO as an "open state• and other organized criminal operatives are

31 now migrating to Florida from other st,ltes, and

2

COOIHC1 Wo,d, in� du�glt typo �re dol,.llon, r,am ui,tint low; word, �o,o addition, •

l0-e64l-7

WHEREAS, or9anizcd crime is infiltratin9 and corruptin9

le9itimate busine6ses opcratin9 within this state and this

infiltration and corruption uses vast amounts of money, ·power,

,1 and all the techniques of violence, intimidation, and other

SI forms of unlawful conduct to accomplish its 9oals, and

WHEREAS, in furtherance of such infiltration and

corruption, or9anized criminal operatives utilize and apply to

at th•ic unlawful purposes laws of the State of Florida

91 conferrin9 and relatin9 to the pcivile9e of engaging in

10 various types of business enterprises, and

ll WHEREAS, infiltration and corruption of legitimate

121 business provide an outlet foe illegally obtained capital,

131 harm innocent investors, entrepreneurs, merchants and

14 consumers, interfere with free competition, and thereby

IS constitute a substantial danger to the economic and general

� welfare of the State of Florida, and

17 WHEREAS, in order to ,successfully resist and eliminate

181

such infiltration, it is necessary to provide new criminal and

u civil remedies and procedures, NOW, THEREFORE,

:IO

111 Be It Enacted by the Legislature of the State of f'lorida:

n

23 Section l. Short·title.--This act shall be known as

UI

the "Florida Racketeer Influenced and Corrupt Organization

2S Act•.

1,6

V

Section�- Oefinitions.--As used in this act1

(1) "Racketeering activity• means to commit, to

�,

attempt to cotnJ:1it, to conspire to cocunit, oc to solicit,

� coerce, or intimidate another person to commit,

30

31

3

COOIHC: Wa,,,h i111 � tl.�1' typ• �,. clclc-tlon, (,o,n ••itting low; wo,d, undc,li ruid o,• additi.,u.

10

11

12

10:-643-7

(a) Any crime which is chargeable by indictment or

information under the .followin9 provisions Of the Florida

Statutes:

l, Section 210.18, relating to evasion of payment of

cigarette taxes.

2. Sections 214.60-214.62, relating to nonproperty tax

crimes.

fraud.

3. Section 409.325, relating to public assistance

4. Chapter 447, relating to labor organizations.

5, Chapter i48, relating to general labor regulations.

6. Chapter 501, part II, relating to deceptive and

131 unfair trade practices,

1' 7. Chapter 550, relating to dog racing and horse

ISi ucing.

16 8. Chapter 551, relating to jai alai frontons.

17 9. Ch;ipter 562.! rel�ting to beverage law enforcement.

18 10. Chapter 687, relating to interest and usurious

19 practices.

:xi 11 • . Chapter 782, relating to homicide.

21 12. Chapter 78 7, relating to kidnapping.

22 13. Chapter 790, relating to �eapons and firearms.

23 14. Chapter 796,. relating to prostitution.

24 15. Chapter 806, relating to arson.

2S 16. Chapter 812, relating to larceny, robbery, and

26 related crimes.

21 17, Chapter 817, relating to fraudulent practices,

281 f.alse pretenses, fraud generally· and credit card crimes.

29 18. Chapter 831, relating to forgery and

�,

counterfeiting.

�

4

CODIHG,1 Wcud, I• +ti� dww�k tyj,o Ot• deletion, ftol'fl exhlia9 law; w•1J1 undf'rlin�d or• addition,.

10-643-7

19. Chapter 832, relating to issuance of worthless

checks and drafts.

20. Chopter 836, relating to defamations libels

threatening .letters and similar offenses.

21. Chapter 837, relating to perjury.

22. Chapter 838, relating to bribery, misuse of public

office.

23. Chapter 843, relating to obstruction of justice.

9 24. Chapter 847, relating to obscene literature,·

10 profanity.

11 25. Chapter· 849, relating to gambling.

12 26. Chapter 893, relating to drug abuse prevention and

1l control.

14 21. �ections 918.12-918.14, relating to tampering with

IS jurors, evidence, and witnesse:i.

16 (bl Any crime defined as •racketeering activity• under

lll

Title 18, United States Code, Sec�ion 1961 (1) (bl, (cl, and

18 (d). The commission of a crime as defined in that section may

191

be one of the acts of racketeering activity used to establish

� a pattern of racketeering activity under this act.

21

11

23

,,

lS

16

27

ii

29

3()

ll

(2) "Unlawful debt• means any money or other thing of

value constituting princlpal·or interest of a debt that is

legally unenforceable in this state in whole or in part

because the debt was incurred or contracted:

(a) In violation of any one of the to;lowing

provisions of tbe Plorida Sta\utes:

. l. Chapter 687, re·1atin9 to interest and usury •

2. Chapter sso, relating to dog -racing and horse

racing.

l. Chapter 55·1, relating to jai alai frontons.

4. Chapter 849, relating to gambling.

5

CODING: Wo,4, ia +h ... � ,M•u9I. typ• �,. d•l•tion, froM ••hting low; wo,J, J!.!llli!i.n.s_d, .. aro additioA,.

·9

10.-643-7

(bl In gambling.activity in violation of the law of

tho United States or in the business of lending money at a

rate usurious under federal law,

(3) _"Enterprise• means any individual, sole

proprietorship, partnership, corporation, business trust,

union chartered under the laws of this state, or other legal

entity, or any unchartered unioa,., association, or group of

individuals associated in fact although not a legal entity.

(4) "Pattern of racketeering activity• means the

JOI

commission of at least two acts of "racketeering activity• as

11 defined in subsection (ll, provided that at least one of such

121

acts occurred after tho effective date of this act and that

13 the last of such acts to have been committed occurred within 4

UI years after a prior 11ct of racketeering activity,

lS (5) "Documentary material" means any book, paper,

161 document, writing, drawing, graph, chart, photograph,

17 phonorecord, magnetic tape, or computer print-out, and any

18 other data compilation from which information can be obtained

19 or from which information can be translated into reasonably

� useable form, or any other tangible item.

21

22

Section 3. Prohibited activities.--

(1) It is unlawful for any person who has received any

nl money or other thing of value derived, directly or indirectly,·

u from a pattern of racketeering activity or through the

25 collection of an unlawful debt to use or.invest, whether

� directly or indJrectly, any part of such money or thing of

V value, or the proceeds derived from the investment or use

n thereof, in the acquisition of any title to, or any right,

n interest, or equity in real property, or the establishment or

� operation of any enterprise in this state.

JI

6 _.,

. . ,

COOIHC, w.,�, i11 +tuo1t.k tl,,..wvii. 1y'p,; �,t d•l•ti•tu f,o"' �•hlin9 law; we,d, undctlins:d ore addition,.

10-643-7

(21 It is unlawful toe any person, through a pattern

of racketeering activity or through the coliection of an

unlawful debt, to acquire or maintain, directly or indirectly,

any interest or control of any enterprise or real property in

51

this state.

(31 It is unlawful for any person employed by, or

associated with, any enterprise 'to conduct or participate,

directly or indirectly, in such enterprise through a pattern

91 of racketeering activity or the collection of an unlawful

10 debt.

11 (41 It is unlawful for any person to. conspire or

12 attempt to violate any of the provisions of subsections (11,

13 ( 2 I , or I 3 I •

1'1 Section 4. Criminal penalties.--

H (11 Any person convicted of a willful violation of the

� provisions of ·section 3 of this act is �uilty of a felony of

n th� third degree, punishable as provided in s. 775.082, s.

1a 775.083, and s. 775.084, Florida Statutes.

It (21 Any person convicted of a willful violation of the

�I provisions of section 3 ·shall forfeit to tho stat�:

21 (al Any interest which he has acquired· or maintained

221 in violation of section 3; and

2J (bl Any interest· in, security issued by, claim

,, against, or property or contractual right that affords a

2s source of influence or control over, any enterprise or real

,,s property which be has owned, participated in, esta�lished,

v operated, controlled, or conducted, in violation of section 3,

,a (31 In any criminal action brought by the state under

29 this act, the court shall enter such injunctions, or take such

� other action, including but not limited to, the acceptance of

JI satisfactory performance bonds, affecting any property or

. .- ·. 7

COOIHG: We,d, i11 +t•4H-� 11.,�glt type;,. d�le1io,u f,o,.. axi11in9 low; wt1d, �o,• oddi1lo,u .

10-:643-7

other interest subject to forfeiture under this section, as

the court may deem proper.

(41 Upon conviction of� person under this act, the

court may authorize the immediate seizure of all property or

51 oth�r interest declared forfeited. The state shall dispose of

all forfeited property as soon as commercially feasible,

making due provision for the rig�ts �f innocent persons. If a

property right or other interest is not exercisable or

·91

transferable for value by the state, it shall expire an� it

u shall not revert to the convicted _person.

11

12

Section 5. Civil rernedies.--

(1) The court may, after making due provision for the

13 rights of innocent persons, enjoin violations of section 3 by

14 issuing appropriate orders and judgments including, but not

u limited to,

16 (al Ordering any person to divest himself of any

171

interest, direct or in_direct, in any enterprise or real

18 property;

19 (bl Imposing reasonable restrictions on the future

� activities or investments of any person, including but not

21 limited to, prohibiting any person from engaging in the same

22 type of ·endeavor as tho enterprise in which he was enga;;cd in

n violation of section 3;

24 (cl Ordering the dissolution or reorganization of any

2S I enterprise;

26 (d) Ord�ring the suspension or revocation of licenses,

271

permit&, or prior approval. gra0

nted to any enterprise by any

� department or agency of the state;

29 (el Ordnring the forfeiture of the charter of a

�1 corporation organized under the laws of this state or the

Jl revocation of a certificate authorizing a foreign corporation

8

CODIHC: Word, In +ff-4Kk •k�\lh tipe .;. dcl .. tion, f,0111 exi,1in9 low; word, uncl�rlint-d o,c oddi1ion1o.

10-643-7

to conduct business within this state upon finding that the

board of directors or a·managerial agent ac�ing on behalf of

the corporation haa, in conducting the affairs of the

corporation, purposely engaged 1n a pattern of racketeering

activity and that for the prevention of future criminal

conduct o! the same character, the public interest requires

the charter of the corporation forf�ited and the corporation

dissolved or the certificate revoked,

9 (2) Any state agency having jurisdiction over the

10 alleged racketeering activity may institute proceedings under

11 this section, In any action brought under this section, the

11 Circuit Court shall proceed as soon as practicable to the

11 �earing and determination. Pending final determination, the

H Circuit Court may at any time enter such injunctions,

is prohibition�, or restraining orders, or take such actions,

16 including the acceptance of satisfactory performance bonds, as

171 it deems proper.

18 (3) Any person who is or may in the future be damaged

191

in his person, business, or ·property by reason of a violation

� of section 3 of this act shall have a cause of action for

ll I cor.ipensatory and punitive damages, court costs, and rea;onable

111 attorneys' feeB in the trial and appellate courts.

2J (41 A finding of guilt which has become final in any

,, criminal proceedings under this act shall estop the defendant

2.1 from denying the essential allegations of the criminal offense

� in any subsequent civil proceedings.

11 (5) The"imposition of� civil porialty Jnder· any

� provision of this act shall not preclude the imposition of any

·19 other civil penalty under this or any other section of the

3:1 Florida Statute& and civil remedies under this act are

JI supple,:iental_ and are not mutually exclusive,

9

CODJUG: Wor4h i11 "'�'- tlw.vg'6 t"ly• ·�•·,j•lction, f,om e11tl1lin9 low; wo,J,�o,e oddltiont.

10-643-7

Section 6. Civil investigative dcmand.--

(11 For the purposes of this section "investigative

�1 agency• means that state agency· having jurisdiction to

investigate as a crime or as a•violation of state regulatory

laws or rules, the subject matter of racketeering activity.

(2) Whenever the investigative ag•ncy has reason to

believe that any person or enter�rise may be in possession,

custody, or control of any documentary material relevant to a

9 racketeering investigation, it may, prior to the institution

l0 ·of a civil or criminal action or proceeding thereon, issue in

ll writing, and cause t_o be served upon such person, a civil

l1 investigative demand requiring such person to produce such

ll material for examination by the agency or its designated

14 agents or attorneys.

15

16

(3) Each such investigative demand shall:

(a) State the nature of the conduct constituting the

171 alleged racketeering activity violation which is under

1B investigation, the provision of law applicable thereto and the

191

connect ion between the documentary material demanded and the

20 conduct under investigation;

21 (bl Describe the class or classes of documentary

221

material to be producted thereunder with such definiteness and

n certainty as to permit such material to be fairly identified;

24 (cl State that the demand is returnable immediately or

25 prescribe a specific return date which will provide a

a reasonable period of time within which the material so

21 demanded may be assembled ;1nd produced for inspect ion and

u copying or reproduction;

29 (d) Identify the person to whom such material is to be

�I made available,

31

10 ., .

COOIHG1 Word, Jn ..,..,.,.,ll 1 .. ,-.ug� ty�o· a,�· �eletion1 from ••i 1tin9 low; wo,d, undcdip�io,e oddi1ion1.

10-G43-7

(el Be authorized and nigned by the agency director or

his designated agent; and

(fl Be served by a designated representative of the

investigativ_e agency.

(4) No such investigative demand shalli

(a) Contain any requirement which would be held to be

unreasonable if contained in a s�bpoena duces tecum issued by

any court in aid of a grand jury investigation of an alleged

91 violation of section 3; or

10 (b) Require the production of any documentary material

11 which would be privileged from disclosure if production

11 thereof were demanded by a subpoena duces tecum issued by any

13 court in aid of a grand jury investigation of such alleged

u racketeering activity.

15 (51 Service of any such demand or any petition filed

�1 under this section shall be Qade in the manner prescribed by

n the Florida R ules of Civil Procedure for service of original

121 process.

19 (6) A verified return by the individual serving any

�I such deQand setting forth tho manner of such service shall be

21 I pr irna facie proof of such service. In the case of service by

211

regi&tered or certified mail, such return shall bo acco.mpanied

n by the return post office receipt of delivery of such demand,

2' (7) (a) Any person upon whom any demand issued under

lSI

this section has been &crved shall make such material

� available for i�spection and copying or reproduction to the

21 investigative agency at the principal place of business of

� such person, or at such other place as such investigative

� agency and such person thereafter may agree and prescribe in

30 writing or as the court may direct pursuant to this

31 subsection, on the return date and at the tiir.e specified in

11

COOIUG: Wo,JJ i11 �w5&i tlt�I. 11;•· A,e dolc1i•n1 f,om ••htlng law; wo11h UndcrlinuJ°u• eddition•.

10-,643-7

such demand, or on such �ater date or time as the

investigative agency may prescribe in writing. The

investigative agency may, with the permission of such person, 'I take into its possession and issue a receipt for the original

5 ·copy of any such material.

(bl The investigative agency to whom any documentary

material is so delivered shall take physical possession

thereof, and shall be responsible for the use made thereof and

for its return pursuant to this section. The investigative

10 agency may cause the preparation of such copies of such

11 documentary material· as may be required for official use.

11 While in the possession of the investigative agency, no

13 material so produced shall be available for public

14 examination, ,and such material shall be exempt from public

15 disclosure and inspection under s. 119.07, Florida Statutes,

16 and no such material shall be available to other

n investigative, law enforcement, or prosecutorial agencies for

18 inspection and copying. Under such reasonable terms and

19 conditions as the investigative agency shall prescribe,

M documentary material while in the possession of the

investigative agency shall be available for examination by the 21

221

person who produced such material or any duly authori:z:ed

23 representatives of such person.

u (cl Upon completion of the racketeering activity

" investigation for which any documentary material was produced

u under this subsection, and any case or proceeding arising from

V such.investigation, the in�estigative agency shall return to

)8 the person who produced such material all such material other

n than copies thereof made pursuant to this subsection which

� have not passed into lhe control of any court or grand 1ury

31

. , 12 -( • • � I

COOIHC1 Word, i111 4.-4,ye.S., tlu4Wgk typo or� dol•tlo,u f,o"' ••htin9 law; wotch undNlinc-d ore- ocldition, •

10-643-7

through introduction into the record of such case or

21 proceeding.

(di When any documcntar� material has been produced by

any person under this section for use in any racke�eering

5I activity investigation, and no case or proceeding arising

therefrom has been instituted within a reasonable time after

coQpletion of the examination and an�lysis of all evidence

ass�mbled in the course of such investigation, such person

shall be entitled upon written demand made upon the director

10 of the investigative agency to the. return of all documentary

11 roaterial, other than. copies thereof made pursuant to this

ii section, so produced by such person.

ll 181 Whenever any person or enterprise fails to comply

1, with any civ�l investigative demand duly served upon him under

JS this section or whenever satisfactory copying or reproduction

u of any such material cannol be done and such party refuses to

17 surrender such l!Ulterial, the investigative agency may file, in

ta the Circuit Court in any county in which such person resides

· w or transacts business, and serve upon such person, a petition

� for an order of such court for the enforcement of this

n section. However, if such person transacts busineliS in more

n than one county such petition shall be filed in the county in

n which the party maintains his principal place of business.

2l 19) Within 20 days after the service of any such

25 demand upon any person or enterprise, or at any time before

� the return date �pecified in the demand, whichever period is

n shorter, such person may fi�e, in the Circuit Court of the

� county within which such person resides or transacts business,

n and serve upon the investigative agency, a petition for an

30 order of such court modifying or setting aside such demand.

31 The tim� allowed for compliance with the demand in whole or in

13

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10-643-7

part as deemed proper and ordered by the court shall not run

21

during the pendency of the petition to the court. The

3 petition shall specify·each ground upon which the petitioner

relies in seeking relief, and may be based upon any failure of

the dem�nd to comply wi�h the provisions of this subsection or

61 upon any constitutional or legal right or privilege of the

party.

(10) At any time during which the investigative agency

.9 is in custody or control of any documentary material delivered

10 ·by any party in compliance with an_y such demand, said party

11 may file, in the Cir.cult Court of the county where the

121 documentary material was delivered, and serve upon the

�1 investigative agency, a petition for an order of the court

14 requiring the performance of any duty imposed by this section.

IS Ill) Whenever any petition is filed in any court under

16 this section the court shall have jurisdiction to hear and

17 determine the matter presented, and, after a hearing at which

18 all partiE:s are represented, to enter orders required to carry

19 into effect the provisions of this act.

20 Section 7. If any provision of this act or the

21 application thereof to any person or circumstance is held

n invalid, the invalidity shall not affect other provisions or

23 applications of the act which can be given effect without the

u invalid provision or application, and to this end the

25 provisions of this act are declared severable.

2G

2)

28

n

30

ll

Section B, This act shall take effect October l, 1977 •

•••••••••••••••••••••••••••••••••••••••••

SENl\TE SUM:-ll\R'i

Makes it a third degree felony for any person to: use money or any other thing of value derived from racketeering activity or tho collection of an unlawful

14

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9

10

II

12

13

14

H

16

11

18

19

:io

21

22

23

24

2S

26

21

28

29

30

JI

10-643-7

debt to acquire any title, right, interest, or equity in real property or in ariy enterprise in thiq state; to acquire or maintain any interest or control of any enterprise or real property in this state through racketeering activity or the collection of an unlawful debt; and to conduct or participate in an enterprise through a pattern of racketeering activity or the collection of an unlawful debt. Also makes it a third degree felony to conspire or attempt to commit any such offense. Provides for the forfeiture of any interest, security, claim, or property or contractual right, in any property or enterprise owned, operated, participated in, controlled, conducted, or established in wilful violation of such criminal provisions. Authorizes a court to enjoin such criminal offenses by: ordering the divestiture of any interest in any enterprise or real property; imposing reasonable restrictions on future activities or investments; ordering dissolution or reorganization of any enterprise; ordering the suspension or revocation of licenses, permits, or approvals to any enterprise; ordering forfeiture of a corporate charter or authority to conduct business in this state.

Authorizes any state agency having jurisdiction over the alleged racketeering activity to bring a civil action under the act. Authorizes any person damaged by a criminal offense under the act to bring a civil action and authorizes attorney's fees in such actions. Provides that a finding of guilt in any criminal. proceeding under this act estops the defendant from denying the essential allegations of the criminal offense in subsequent civil proceedings. Provides that the imposition of a civil penalty under the act does not preclude the. imposition of any other civil penalty. Authorizes a state agency having jurisdiction to investigate any racketeering activity to issue a civil investigative demand requiring production of any relevant documentary material, provides for court. enforcement of such demand, and provides for the

_confidentiality of such material.

15

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FLORIDA HOUSE OF R EPRESENTATIVES

SELECT COMMITTEE ON ORGANIZED CRIME

SPECIAL REP ORT: A STATE COM MIS SION OF INVESTIGATION

COVER PICTURE

Pictured on the cover is witness Bobbie Miller from a wire service photo taken in 1977 as he testified before the Select Committee on Organ­ized Crime on the activities of the notorious Dade County Cravero Gang.

FLORIDA HOUSE OF REPRESENTATIVES

Eric Smith Chairman

Joseph M. Gersten Vice Chaimian

April 19, 1978

DONALD L. TUCKER, Speaker/JOHN L. RYALS, Speaker Pro Tempore COMMITTEE ON CRIMINAL JUSTICE

SELECT COMMITTEE ON ORGANIZED CRIME

The Honorable Donald Tucker Speaker of the House Florida House of Representatives Suite 420, The Capitol Tallahassee, Florida 32304

Dear Mr. Speaker:

Your House Select Committee on Organized Crime respectfully submits the attached Special Report on a State Commission of Investigation.

Repre ict4mith, Chairman

-=� Representative Joseph Gersten, Vice-Chairman

�� Representative Curtis Kiser

Ralph H. Haben, Chairman, Committee on Criminal Justice Aaron K. Bowden, General Counsel Henry M. Searcy, Special Counsel

Karl R. Adams, Staff Director

20 House Office Buildinir. Tallahassee. Florida 32304 (904) 488-0085

ACKNOWLEDGEMENTS

During the course of preparing this Special Report, the Select Committee on Organized Crime had the good fortune to receive valuable assistance and encouragement from a number of people and organizations in Florida. We particularly ack­nowledge the special contributions of the following people:

CARLA MILLER Administrative Aide, Select Committee on Organized Crime

BEN THOMPSON General Counsel, House Committee on Criminal Justice

MAJOR STEVE BERTUCELLI Director, Organized Crime Bureau Dade County Public Safety Department

MICHAEL SIAVAGE Executive Director New Jersey State Commission of Investigation

ORGANIZED CRIME INSTITUTE Miami, Florida

TABLE OF CONTENTS

Introduction . .

The Menace of Organized Crime Defined and Illustrated

Economic Impact of Organized Crime .

The State Commission of Investigation--Rationale . . . . . . . . .

Support for the Creation of a State Commission of Investigation

Conclusion .

Appendix A - House Bill 686 An Analysis

Appendix B - Organized Crime Figures in Florida

1

2

5

6

11

15

-1-

Floridians need to awaken before its too late. There is

a menace that is running rampant. It is Florida's nightmare.

Its cast of characters move in every area of our state,

changing our lives and lifestyles. The nightmare becomes a

cancer eating away at our ?eople, our economy and the legitimate

businesses of this state. The menace is organized crime, not

limited to the Mafia, but in its newer manifestations as well.

It is pervasive, insidious and flourishing in our state.

In June 1977, the Select Committee on Organized Crime

issued an interim report on the extent of organized crime in

Florida. It outlined the activities of these families and

groups. Among these lucrative sources of income are gambling,

narcotics, loan-sharking, labor racketee�ing, pornography

and white collar crime. Its dimensions are constantly broad-

ening--computer crime is an example of its incessant movement

into new territory. Violence, fear and corruption are used

to insure that these activities are profitable and that its

participants remain virtually untouched by the law.

Dismantling and destruction of organized crime in Florida

is of critical importance. It is both the charge and the

challenge of the Select Committee to find the most effective

way to attack the problem. Traditional approaches in fighting

crime have not worked. Ours has been an insufficient commit-

rnent to law enforcement and an approach put together with

"bubble gum and bailing wire." Needless rivalries among law

enforcement agencies at all levels create a situation that

-2-

hampers any meaningful assault upon organized crime and actually

furthers its cause.

In December 1977, after over a year of intense study

and the taking of testimony in public hearings in four cities

around the state of Florida, the House Select Committee on

Organized Crime unanimously adopted proposed legislation

creating a Florida State Commission of Investigation (S.C.I.)

The Commission, patterned after a similar and highly successful

effort in New Jersey, will provide the Legislature with an

on-going mechanism to investigate organized criminal activities

in Florida. A Florida S.C.I. will not only bring to light

criminal activities but more importantly, as a fact-finding

commission, it will be the driving force in creating new

approaches to solving what remains an insurmountable problem.

The S.C.I. will be governed by the same legal safeguards

that have traditionally served American justice. Creating

a State Commission of Investigation would chisel into Florida

law an independent, non-political, full-time, continuing

investigative effort owing allegiance to no politician, party

or administration. The Commission would complement and

assist law enforcement and prosecutorial agencies. Making

organized criminal activities public will remove the cloak

of secrecy from them and will mobilize public support in

the war against organized crime.

The Menace Defined and Illustrated

Ralph Salerno, a noted expert on organized crime, well

defined its essential nature during testimony before the

-3-

Select Committee:

"Organized Crime is a self-perpetuating, continuing criminal conspiracy, for profit and power, using fear and corruption, and seeking immunity from the law."

This is an excellent definition but falls short in communicating

the actual and incredible violence of organized crime activities,

the fear of our citizens and the resultant economic impact on

our state. The following brief statements have been taken from

the hours of testimony before the Select Committee. They

graphically illustrate the threat facing the people of Florida.

----Organized Crime operatives were actively harrassed by a highly principled police officer--Richard Cloud. Officer Cloud was put on an "assasination list". Shortly there­after, in October 1975, Cloud was murdered right before he was to testify before a federal Grand Jury. Ellis Haskew, arrested and convicted for this murder procured by the Trafficante family in Tampa, testified to the Select Committee that after the murder, the "hitman" said that "It was no different than shooting a dog".

----"I'm telling you that A & P was victimized by organized crime when it was America's largest grocery store. Well ... if you can say "so what, we've got organized crime" and you're John Q. Citizen, and you see American Tobacco Company, Kraft Cheese Company, A & P and Mobile Oil being victimized and you aren't frightened, well then you're an idiot. Because if they can take on those guys, who in the hell are you?" (Ralph Salerno, testifying before the Select Committee

----Bobbie Miller, ex-operative with the notorious South Florida Cravero group on the subject of drug smuggling: Q.

A. Q.

A. Q. A.

Q. A.

What happened to the vessels after they had made their drug runs? We burned them. You're talking about vessels that could cost a considerable sum of money, are you not? Yes sir. They cost in the neighborhood of $50,000. You would burn a $50,000 vessel? And not blink an eye.

Why? We didn't want to clean it up because it had all of the marijuana residue in it. Nobody wanted to ride it and one bale {of marijuana) made up for the boat.

-4-

Q. How much on the average was it worth to you to bringin a load of marijuana?

A. Well, the last run I made I still have $175,000 comingto me.

----"Well, we had better equipment than the police depart­ment had for one thing. Our radios were superior, we could monitor all police calls. We knew where the police were at all times that they were looking for us." (Bobbie Miller, testifying before the Select Committee)

----"T.here are indications that organized crime is in the service industries, hotel ownership and real estate." (Major Steve Bertucelli, Dade County Department of Public Safety, Organized Crime Bureau)

----Attorney General Hyland of New Jersey stated that before the S.C.I. was formed in New Jersey: "Our state quickly developed a national reputation as a governmental cesspool, a bedroom for hired killers and a dumping ground for their victims.

Florida is precariously close to duplicating these conditions,

as substantiated by the testimony given to the Select Committee

by Joe D'Alessandro:

"There have been in excess of twenty contract killings related to drugs within the state of Florida by one group. And that is being investigated at this time. Some by myself, some by other agencies, a lot of coopera­tion with each other. But, that's vicious. That's wrong. It's bad and it's going on and it's related directly to drug smuggling because it's profitable.

I have the Everglades. I cannot tell you how many times a body is found in the Everglades and the killing did not occur there. The body was put there. Some are decomposed so you can't find anything out about them. But, they come, it's our belief, from Dade County. The killing has taken place there and it ends up in Collier County. There is a lot of that.

On a statewide basis, I don't know what is happening day to day in the Panhandle or Miami or Jacksonville or whatnot. None of my law enforcement agencies do. And to get fifty agencies all putting in information and assimilating it and looking at it is still not the most effective way. You need one agency to say, 'Hey, I can tell you what's happening from top to bottom, east to west'."

-5-

Economic Impact of Organized Crime

Nationally, organized crime grosses more than the combined

annual net income of corporate giants General Electric, General

Motors, U. S. Steel, Standard Oil, I.B.M., R.C.A. and DuPont.

Reliable statistics, though conjectural, suggest that the

economic impact of organized crime in the state of Florida totals

in excess of seven billion dollars a year. (This includes

profits from gambling, narcotics, loansharking, pornography,

financial and real estate fraud, and computer crime, among other

criminal ventures and enterprises.)

Organized crime effects every citizen in Florida either

directly or indirectly. Mob activities contribute to higher food

prices, insurance rates and tax burdens. Organized crime

turns young people into drug addicts and runaways into prostitutes.

It preys upon the poor, the powerless and the unsuspecting. It

corrupts public officials and undermines the moral and economic

fabric of our state and nation. Perhaps the most absurd state­

ment of the decade, reported earlier in the press and attribu-

ted to Meyer Lansky, reputed financial genius of organized

crime, was "There's no such thing as organized crime."

(Lansky said this as he urged Florida to welcome the "Trojan

Horse" of casinos with open arms.)

Now is the time for coordinating our efforts to destroy

organized crime. "Turfism" must give way to mobilization of a

carefully planned thrust against the massive movement of organ-

ized crime into our state. It may well be our last chance to do so.

-6-

The State Commission of Investigation--Rationale

Legislation proposing a Florida State Commission of

Investigation was modeled after the New Jersey Commission of

Investigation, highly regarded as helping to rid New Jersey of

mob influence. The executive director of the New Jersey

Commission, i1r. Michael Siavage, in testimony before the Select

Committee, stated:

"Ironically, many of the key crime figures now residing in Florida fled from New Jersey to escape being subpoenaed and interrogated by the New Jersey SCI." (He further stated that the number of high eschelon mob figures was approximately 40 and that our state is suffer­ing from what the press has characterized as the 'Jersey Flu' . ) "This 'Jersey F 1 u' exodus from our state is a primary reason why we are constantly urging other states to create inde­pendent crime commissions and to adopt new and more powerful anti-crime laws."

The structure of CS for HB 686 (Senate Companion Bill--

SB 379, by Senator George Williamson) resembles the model legisla­

tion proposed by the National Con=erence of Commissioners on

Uniform State Laws. Legislative investigating committees have a

long history. The first congressional investigating committee

was established in 1792 to "inquire into the causes of the failure

of the late expedition of Major General St. Clair."

Congress 493 (1792).

3 Annal of

The most recent example of a committee of this nature was

the Senate Watergate Committee. The Committee took testimony

but had no power to seek a criminal indictment, initiate a trial

or impose punishment. These functions were prosecutorial and

handled by a Special Prosecutor. Likewise, an SCI would not

-7-

duplicate law enforcement or prosecutorial functions, but would

merely plug up a gap by both serving as a basis for legislation

as well as alerting the public to the existence and abuses of

organized crime. Information adduced during investigations and

hearings would be turned over to the proper authorities if

the commission found evidence of criminal misconduct. The

State Commission of Investigation would be able to cut through red

tape that the traditional agencies cannot and therefore obtain

information that would otherwise remain undisclosed.

An area of concern centers upon the rights of witnesses

before such a commission. It has been suggested that SCI proceed-

ings may reflect unfavorably upon individuals without accusing

them of a crime. Some risk is inevitable, but as in so many

matters a balance must be struck between this potential for

injury and the benefits to be realized by the public when their

interests are protected. The Select Committee recognized the

need to protect any witnesses from potential harm and therefore

incorporated a Code of Fair Procedure into CS for HB 686. The

rights of a witness are clearly outlined. Every witness called

before this commission will be informed of the subject matter of

the hearing. A witness has the right to be accompanied by counsel

(unlike the present grand jury system), and to submit questions

relevant to the inquiry which the commission then must ask.

Finally, a witness is given the right to make a relevant state­

ment which must be incorporated into the record subsequent to

appearing before the commission. The United States Supreme Court

in Hanna v. Larche 363 U. S. 420 (1960), spoke favorably on the

-8-

merits of a similar Code of Fair Procedure within the New Jersey

statutes. This same code was used as a model for CS for HB 686.

The portions of the bill dealing with immunity and contempt

should be mentioned. The most effective weapon in the fight

against organized crime is public awareness. If the public is

informed of what organized crime is doing they will be more

inclined to realize that by placing bets and buying stolen

merchandise they are helping to fund international narcotic traffic,

breaking the bones of loanshark victims and allowing some of our

youth to become drug addicts.

The New Jersey experience clearly demonstrates that the work

of a State Commission of Investigation does not interfere with

prosecutorial functions.

this strong statement:

The Attorney General of New Jersey made

"Prosecutorial agencies ... are limited in dis­cussing at length or in detail specific criminal cases ... in effect, then, there are no public education capabilities on the part of my office, or other prosecutorial agencies, comparable t9 those of the State Commission of Investigation."

According to the Florida Second Statewide Grand Jury, "The

Commission's strong points would be these:

1) The ability to conduct public hearings.

2) The ability to force testimony or incarceration.

3) The ability to operate freely from any outsideinfluences.

4) Little or no involvement in court proceedings asall investigations are referred to the appropriateagency for action.

5) Investigators may be present during executivesessions and may assist the Commission in areasof questioning.

-9-

6) Expertise in analyzing complex corporatestructures would be available statewide.

7) Involvement of all local and state law enforce­ment departments as cases are referred to theState Commission of Investigation."

An example of the unique function that an SCI can perform

is evidenced by a New Jersey State Commission of Investigation

in 1969.

ORGANIZED CRIME INFLUENCE IN LONG BRANCH

"The New Jersey shore city of Long Branch had since 1967 been the focus of publicized charges and disclosures about the influence of organized crime. One charge was that an organized crime leader, Anthony "Little Pussy" Russo, controlled the mayor and the city council. Official reports indicated mob figures were operating in an atmos­phere relatively secure from law enforcement. The Commission began an investigation of Long Branch in May, 1969. The exhaustive probe culminated with public hearings in the spring of 1970. Among the major disclosures of those hearings were:

That a Long Branch city manager was ousted from that job by the city council after he began taking counter-action against organized crime's influence; that Russo offered to get the city manager job back for that same person if he would close his eyes to underworld influences and act as a front for the mob; that impending police raids on gambling establishments were being leaked in time to prevent arrests despite the anti-gambling efforts of a then honest police chief who died in 1968, and that the next police chief lacked the integrity and will to investigate organized crime and attempt to stem its influence.

After the Commission's public hearings, the police chief resigned and the electorate voted in a new administra­tion. The Asbury Park Press commented editorially that the Commission's hearings did more good than four previous grand jury investigations. Also, during the Commission's probe of the Long Branch area, the Commission's special agents developed detailed fiscal information and records relating to corporations formed by Russo, information which was used by federal authorities in obtaining a 1971 indictment of Russo on a charge of failure to file corporate income tax returns. He pleaded guilty to that charge and received a three-year prison sentence."

(State of New Jersey Commission of Investigation, 1974 Annual Report).

-10-

One of the most succinct illustrations of the effectiveness

of a State Commission of Investigation comes from Pappy Ipolito's

(boss of an organized crime gambling network) answers to a series

of questions posed to him by the Pennsylvania Crime Commission.

Q. Why didn't you move to New Jersey?

A. New Jersey? You know why.

Q. I asked you a question.

A. I was afraid that New Jersey would take me into answer questions.

Q. Who in New Jersey?

A. The State Commission of Investigation.

Ipolito moved to Pennsylvania to avoid confrontation with

the New Jersey State Commission of Investigation.

'associates' came to Florida for the same reason.

Many of his

The Select Committee on Organized Crime makes a finding of

fact that the creation of a State Commission of Investigation

coupled with the dedication, determination and intelligence of

our law enforcement and prosecutorial agencies will strike at

the ''Achilles' heel" of the Mafia and other forms of organized

crime in Florida.

-11-

Support for the Creation of a State Commission of Investigation

In proposing the creation of an SCI, the Select Committee

is taking an approach that those who have had the greatest experi­

ence in this area advocate as an extremely effective weapon in

the war against organized crime.

In 1967, the President's Commission on Law Enforcement and

Administration of Justice stated that crime investigating

commissions are among the most effective vehicles for initiating

public education and interest in organized crime.

"Among the most effective vehicles for providing public information on organ­ized crime are the crime investigating commissions, which exist in a number of states. When established without having to rely on continuing governmen­tal financial support and the resulting potential political pressures, the private crime commission has frequently rendered major service in exposing organ­ized crime and corruption and arousing public interest. The Chicago Crime Commission and the Metropolitan Crime Commission of New Orleans have played major roles in informing the citizens within their jurisdictions of the menace of organized crime and have fulfilled substantial educational, investigative and legislative functions.

A governmentally sponsored nonpartisan crime commission, such as the New York State Temporary Commission on Investiga­tion, has significant benefits. Estab­lished shortly after the Apalachin meet-ing it has through a series of public hearings exposed organized crime and cor­ruption. Recent loan-shark hearings prompted legislative action to make prosecution of such offenders less difficult. The Illinois Crime Commission, through public hearings and the efforts of its own investigators,

-12-

continually exposes organized criminal activity. A governmental commission in California detailed the operations of criminal cartels in that State in the early 1950's and recommended action that subsequently proved effective."

(President's Commission on Law Enforcement and Administration of · Justice, Challen e of Crime in a Free Society (1967) at 198; ***, Task Force Report: Organized Crime 1967) at 14.)

The National Advisory Committee on Criminal Justice Standards

and Goals recommended the following:

"States that have organized crime groups in operations should create and finance Organized Crime Investigation Commissions with indepen­dent, permanent status, with an adequate staff of investigators, and with subpoena power. Such commissions should hold hearings and furnish periodic reports to the legislature, Governor, and law enforcement officials."

(National Advisory Committee on Criminal Justice Standards and Goals, Organized Crime, Standard 1.2, pp. 36.7, 1976).

The Florida Second Statewide Grand Jury also strongly rec-

ommended the creation of a State Commission of Investigation:

"In addition, the Grand Jury strongly recommends that serious consideration be given to the crea­tion of a State Commission of Investigation. In its interim report this Grand Jury proposed such a Commission and after considering the additional evidence it has received and the testimony it has heard, the Grand Jury more so than ever, sees the need for such a Commission. It should be noted that the State of New Jersey has a State Commission of Investigation which has been highly successful in its efforts to rid New Jersey of the organized crime influence. However, in ridding New Jersey of its problem it has created a problem for Florida in that most if not all of the organized crime figures which have left New Jersey because of the Crime Commission have settled in Florida".

E. Wilson Purdy, Director of the Dade County Public Safety

Department and an expert in organized crime in Florida wrote to

-13-

Representative David Lehman and stated:

"Your proposed legislation HB 686 creating a statewide investigative commission has the full support of this department."

Additionally, Leo F. Callahan, Chief of Police of Ft.

Lauderdale, supported the SCI and elaborated on the need for

it as a mechanism for citizen education:

"I view it as a very viable means of supplementing and assisting the work of the Statewide Grand Jury and not posing any duplication of effort. This would be particularly true if coordination with the State Attorneys and local law enforcement agencies were sought. By the very nature of Grand Jury proceedings, information discussed there cannot be made public. This often leads an uninformed citizenry to believe nothing is being done. A commission such as you endorse could serve as the vehicle to properly educate the public in the workings of organized crime, and to provide the catalyst for greater public assistance in this most important battle."

In 1968, Attorney General Shevin (then a Senator) was Chair­

man of a Select Committee to Investigate Organized Crime and Law

Enforcement. In the committee's final report, a strong recommenda-

tion was made to create a State Commission of Investigation.

"I would recommend that a full fledged State Crime Commission consisting of approximately five members with the broad powers to conduct private or public hearings, the power to sub­poena, and the power to grant immunity to witnesses be established."

Recently, in Attorney General Shevin's report to the 1978

Legislature, the Attorney General reiterated the need for a State

Commission of Investigation:

"Florida Crime Commission--In the 1969 Legis­lative Session, as a State Senator, I pro­posed the creation of a statewide crime commission to fight organized crime. At that

-14-

time, the Legislature opted for creation of the Florida Department of Criminal Law En­forcement. I still believe firmly that a

crime commission, modeled after that which has been so effective in New Jersey, would do a better job of coping with the invasion of organized crime figures into the state and its businesses. A crime commission should not conflict with the work of the Florida Department of Criminal Law Enforcement. There is enough criminal activity in this state to demand the attention of all our law enforce­ment agencies; and ideally, they should work together."

In his opening remarks to the 1978 Florida Legislature,

Don Tucker, Speaker of the House, stated:

"I urge your support of the bill recommended by our Select Committee on Organized Crime to create a separate crime investigation com­mission patterned after the legislation enacted by the Commission of Investigation in the state of New Jersey which was regarded as being highly successful in ridding New Jersey of organized crime influence. This Commission is intended to supplement the traditional agencies of law en­forcement. It is not intended to preclude other law enforcement agencies or investigatory bodies from engaging in organized crime preven­tion and control efforts."

It is our sincere hope that the 1978 legislature will make

a determined stand against organized crime by favorable considera-

tion of the SCI legislation. Further delay in establishing an

SCI will cost the state billions and continue to jeopardize

the safety of its citizens.

-15-

Conclusion:

Robert Blakey (Pro£essor of Law, Cornell Law School,

Director 0£ Cornell Institute on Organized Crime) in his tes­

timony to the Select Committee made this striking analysis:

"There are old people who cannot go anywhere, can­not open doors, who are literally locked up. If the legislature passed a statute saying everybody over 65 must remain in their homes and cannot leave at night, what would the newspapers do? What would the American Civil Liberties Union do? What would the courts say to that kind of legislation? And yet by a failure to enforce the law and to commit resources to make it safe, we've locked up all these people."

Organized Crime's "recipe" for absolute control and domi­

nation over the State of Florida includes the following ingredients:

dispersed law enforcement efforts, inadequate funding of law en­

forcement activities, "turfism" defeating attempts at coordination,

anonymity from the citizens of the state, ability to operate out

of the "sunshine of public scrutiny", inadequate resources of law

enforcement to crack sophisticated white collar crime (including

computer crimes), legalized casino gambling, limitation of prose­

cution authorities to "transactional immunity" and permitting

lawyers to accompany witnesses in the Grand Jury room.

We are precariously close to the "perfect mix".

As stated by ex-organized crime figure, Bobbie Miller, in

testimony to the Select Committee on Organized Crime:

"Q. What do you think in general were the most successful tools of your organization and how were you able to escape detection for such a long period of time?

A. Well, for one thing, the public cooperated withus more than they did the police department.

Q. In what sense?

-16-

A. Well, basically, they thought we were Robin­hoods. I mean, you walk in and tip the waiterand the car hop fifteen or twenty dollars everytime you walk in the door, pretty soon he is yourfriend. That goes for any other place that youmight go."

A State Commission of Investigation would be a giant step

toward curtailing the efforts of organized crime. It will

expose the activities of organized crime and increase public

awareness of this menace.

How did a climate of tolerance ever evolve in this state

to attract scores of reverse-Robin Hoods, fleecing and stealing

from the poor (and the rich) to feather their own already lucra­

tive nests? And why, even in the wake of the Shevin Committee

report nearly 10 years ago which should have sparked interest

to drive the rascals out, have we in this state paid only lip

service at best to the problem?

Perhaps a commentary on this can be drawn from the

remarks of Vice-Admiral Hyman Rickover when he spoke to a

congressional committee:

"The unwillingness to act and to accept responsi­bility is a symptom of America's growing self­satisfaction with the status quo ... A major reason why so large a majority is smugly docile is that it has accepted the unwritten rules of the game: don't rock the boat as long as you get your cut. Why become worked up over corruption as long as there are enough benefits of the fallout to go around? Once the acceptance of corruption becomes sufficiently widespread, effective exposure seems threatening to too many people and interests. Clamor for closing loopholes declines in direct proportion to the number of people who benefit from loopholes of their own." (U. S. News and World Report, October 22, 1973).

-17-

Floridians are ready for this Legislature to ''rock the

boat" on both organized crime and public officials who directly

or indirectly allow it to thrive by their actions, apathy or

inaction. A concerned and vigilant legislature must respond.

The Select Committee on Organized Crime is hopeful that the

same legislature which, in 1977, passed the landmark Racketeer

Influenced and Corrupt Organizations Act and the Anti-Fencing

legislation will strike another telling blow at organized crime

by creating the Florida State Commission of Investigation in

1978.

APPENDIX

APPENDIX A

House Bill 686: An Analysis

1) Section 13.301 provides a short title for the act:the "Florida State Commission of Investigation Act of 1978."

2) Section 13.302 establishes the commission consistingof four members appointed by the Governor. Each commissioner will serve for five years; their terms to be staggered. They will re­ceive an annual salary of $31,000 and no member or employee of the commission is to hold any other public office or employment. Each commissioner is subject to removal by the Governor for the same reason that other state officers can be removed under Article IV, Section 7 of the State Constitution.

3) Section 13.303 establishes the primary responsibilitiesof the commission to conduct investigations in connection with:

(a) the faithful execution and effective enforce­ment of the laws of the State of Florida,with particular reference to organized crimeand racketeering

(b) the conduct of public employees and ofofficers and employees of public corpor­ations and authorities

(c) any matter concerning the public peaceor public safety.

4) Section 13.304 permits the commission to conduct in­vestigations or otherwise assist in the making of recommendations, changes in or additions to existing provisions of law. Any State Attorney whose office is conducting an investigation shall be given the opportunity to object to the public hearing. Disputes between the State Attorney and the Commission shall be resolved by the chief judge of the objecting State Attorney's judicial circuit.

5) Section 13.305 authorizes the commission to maintainan office; to conduct private or public hearings; to administer oaths and subpoena witnesses and records; and to seek an arrest warrant for persons who fail to respond to the command of a law­ful subpoena. A public hearing may be held only after adoption of a resolution by a majority of the commission and consultation with the appropriate prosecuting officials.

6) Section 13.306 directs the commission to cooperate with,advise and assist law enforcement officials in the performance of their duties.

7) Section 13.307 mandates that the commission cooperatewith officials of the Federal government concerning violations of the Federal laws within the state.

8) Section 13.308 authorizes the commission to investi­gate matters that affect Florida and other states relating to law enforcement, and, to this end, the commission may consult with and exchange information concerning law enforcement problems of mutual concern with the appropriate officials of other states.

9) Section 13.309 directs the commission to refer evidenceof a crime when there is cause for prosecution to the appropriate officials responsible for that prosecution.

10) Section 13.310 authorizes the commission to appoint andemploy an executive director, counsel, investigators, accountants and staff as are deemed necessary. Investigators and accountants shall have the power of peace officers.

11) Section 13.311 directs the commission to make an annualreport to the Governor, President of the Senate and Speaker of the House of Representatives. Such reports shall ·include the recommendations of the commission.

12) Section 13.312 permits the commission to exempt itsproceedings, when consistent with the other portions of the bills, from the application of the "sunshine" law. However, the commis­sion is directed to keep the public informed as to the operations of organized crime, the problems of law enforcement, and the other activities of the commission.

13) Section 13.313 specifically provides that the powersgranted to the commission do not supersede, repeal or limit any power, duty or function of the Governor, any department or any agency of the state, including the power, duty or function of a grand jury.

14) Section 13.314 directs other agencies of the governmentto cooperate with and assist the commission in the performance of its duties.

15) Section 13.315 provides that, except as expressly author­ized in the bill, the disclosure or dissemination of information concerning the name of any witness examined or of any testimony or other evidence adduced at a private hearing, is a felony of the third degree. An absolute privilege concerning statements made in proceedings before the commission is established.

16) Section 13.316 directs the circuit court to impound cer­tain evidence for subsequent use by the commission.

17) Section 13.317 empowers the commission to grant immunity to witnesses who may refuse to answer questions or produce evidence on the grounds that they will be exposed to criminal prosecution, penalty or forfeiture. Before granting immunity the commission is

directed to give notice the the appropriate state attorney and give said state attorney the opportunity to be heard in opposition. If an impasse is reached between the S.C.I. and the state attorney with respect to any proposed grant of immun­ity, the chief judge in the state attorney's judicial circuit shall resolve it.

18) Section 13.318 provides a "Code of Fair Procedure"to be utilized by the Commission in the conduct of public and private hearings.

19) Section 13.319 provides for severability.

20) Section 2 appropriates $750,000 from the generalrevenue fund to carry out the purpose� of the bill.

21) Section 3 provides an effective date.

APPENDIX B

Organized Crime Figures in Florida

Representatives of the following La Casa Nostra "families"

influence organized crime activities in Florida:

Raymond Patriarca (Boston, Massachusetts)

Stefano Magaddino* (Buffalo, New York)

Joseph Zerilli (Detroit, Michigan)

Samuel DeCavalcante (New Jersey)

Joseph Colombo* (New York City, New York)

Carlo Gambino (New York City, New York)

Vito Genovese* (New York City, New York) Gerardo Catena, acting boss in view of Genovese's death

Thomas Luchese* (New York City, New York) Carmine Tramunti, acting boss

Joseph Bonanno (New York City, New York) Paul Sciacca, boss

Angelo Annaloro Bruno (Philadelphia, Pennsylvania)

Salvatore Giancana* (Chicago, Illinois)

John Scalish (Cleveland, Ohio)

Carlos Marcello (New Orleans, Louisianna)

Sebastian John LaRocca (Pittsburgh, Pennsylvania)

Santo Trafficante (Tampa, Florida)

The Organized Crime "family" of Vincent Cotroni (Quebec Canada)

Meyer Lansky (Miami, Florida)

(*Indicates the successor as boss of the "family" has not since been publically identified�)

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File·Folder

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SELECT COMMITTEE ON ORGANIZED CRIIvlE

DECEMBER 12, 1977

Tallahassee, Florida

ME,:,IBERSHIP .A.ND STAFF

Select Committee on Organized Crime

Representative Eric Smith, Chairman District 19, Jacksonville

Representative Joseph Gersten, Vice Chairm�� District 109, Miami

Representative Robert Crawford District 49, Winter Haven

Representative S. Curtis Kiser District 54, Dunedin

Representative David Lehman District 97, Hollywood

Committee on Criminal Justice:

Representative Ralph Haben, Chairman District 71, Palmetto

General Counsel to the Select Coro.mittee

Aaron K. Bowden, Esquire 1642 Gulf Life Tower Jacksonville, Florida 32207

Special Counsel to the Select Committee

Henry M. Searcy, Esquire 1002 Blackstone Building Jacksonville, Florida 32202

Staff Director to the Select Cormnittee

Karl R. Ada.:.uS 20 House Office Building Tallahassee, Florida 32304

Secretarx to t..�e Select Corrnittee

Candy Van Winkle 15 House Office Building Tallahassee, Florida 32304

SMITH:

LEHMAN:

SMITH:

GERSTEN:

SMITH:

SELECT COMMITTEE ON ORGAl�IZED CRIME

DECEMBER 12, 19 77 TALLAHASSEE, FLORIDA

We call the meeting of the Select Committee on· Organized Crime to order. We ask the secretary to note the presence of a quorum.

The first item on our agenda today is the con­sideration of the proposed committee bill on contraband. Members of the committee this is essentially the same bill that we passed last year. There has really not been any changes. Mark, do you want to comment on any changes from last years bill? OK. There really are none. This is the exact form that we passed this on the floor of the House last year. So what I'd like to do is except a motion at this time ...

Mr. Chairman, I move you serve that the committee adopt this draft as a committee bill and send it to Bill Drafting.

OK. You've heard the motion. Discussion or comment on the motion?

Mr. Gersten, do you have any comments on it?

No, Mr. Chairman, it was a good bill last year, it's just as good this year and let's (inaudible).

You will recall members that this is the bill which expands the Florida Contraband Act to in-clude �ssentially

.any property which is the instru-✓-

mentality of a crime. The one example that I thought of was particularly good last year and I think I mentioned it on the floor of the House was in an instance where law enforcement authori-ties might uncover a child pornographyoperation it might have some expensive film equipment therein. It is one thing to be able to make a case against people involved in th at and quite another thing when we can hurt them economically

VAN WINKLE:

VAN WINKLE:

GERSTEN:

VAl."\/ WINKLE:

VAl."\/ WINKLE :

LEHMAN:

VAl."\/ WINKLE :

SMITH:

2

by having all that profit forfeit to the state so that they can't then get some of their other operatives to go back in and use the equipment some other place. So I think this bill is a good one, it's been endorsed by a lot of law enforcement officials. Just as recently as two weeks ago I was in Dade County with Robert Wennerholm who is the Legal Advisor to the Department of Public Safety there and he again endorsed this concept and they're recommending it as part of their legislative package. So we have the motion, any further discussion?

Rep. Lehman moves the bill. the bill.

Rep. Crawford?

Rep. Gersten?

Yes.

Rep. Kiser?

Rep. Lehman?

Yes.

Rep. Smith?

Yes.

Call the roll on

By your vote the committee bill is adopted. It goes to bill drafting and we'll have you sign it as soon as it's prepared in the final (inaudible) form.

Next on our agenda, we're moving out of order, we'll take part three first. We have with us today someone who is really no stranger to two­thirds of this committee. Rep. Gersten and I had the opportunity to visit with him and some of his colleagues in Trenton, New Jersey in February. No one accused that of being a junket since we were knee deep in snow at the time and I know he's glad to be here from Trenton today to work with us. His name is Michael Siavage. I'd like to ask you to come up at this time. He is the Executive Director of the State of New Jersey Commission of Investigation. He has served in that capacity for several years now and we asked him to come here today to react to our bill and to comment on the successes and pitfalls, if any, of the State of New Jersey Cowmission of

SIAVAGE:

SMITH:

SIAVAGE:

3

Investigation and to react to some anticipated criticisms, constructive or otherwise, that might be leveled at this commission proposal for the State of Florida. So without any further commentary from me I'd like to welcome Mr. Siavage to the Select Committee and ask Michael, before you go ahead, just give us a kind of a capsule of your own background.

Thank you,Mr. Chairman.

Let me ask you to use this small microphone, we can record your comments and that way everyone can hear.

Thank you. As far as my own background goes, I've been recently appointed Executive Director of the Commission in June of 1977. Prior to that time I was for nearly four years a Counsel with the Commission and towards the end of that term, for about the last two years of the Com­mission I was the Counsel in charge of the Organized Crime Program of the Commission. Prior to joining the Commission I came directly from a clerkship in Federal District Court in New Jersey having graduated from law school the prior year.

Now I'd like to first read a prepared statement to the Committee and then open the floor, of course, to any questions that the Committee might have on anything I say or anything else that you'd like to ask me.

I am pleased for several reasons to come here to talk about, and to endorse, your proposal for a Florida State Commission of Investigation. One reason is our agency's historic interest in en­couraging other states to create such commissions as a proven weapon in what has to be a nonstop battle against organized crime and official corruption.

It's also a pleasure to discuss the particular legislation you have in mind -- based as it is on our own New Jersey law -- because it gives me a comfortable sense of being able to make a pitch for a worthwhile cause in my own ball park. As you can understand, it is rather satisfying to talk about a statute that still stands essen­tially firm, almost 10 years after enactment, as a practical model for other states to follow.

4

I'm anticipating, too, a personal advantage from this visit since I'm certain I will gain new in­sights about our law from the questions and comments that this discussion generates.

While our S.C.I. statute has weathered any number of critical battlefield tests, few laws are per­fect. Therefore, I plan to concentrate my review on areas of our law -- and your bill -- that might be improved, based on our experience with it. And the revisions I will suggest, I believe, should help both of our agencies -- the New Jersey Com­mission for an even more effective future and the Florida Commission for a more effective beginning.

However, I would like first to make some general observations.

When our Commission was created in 1968, New Jersey, as I'm sure you know, suffered a national reputa­tion as a haven for gangsters and crooked politi­cians. Crime and corruption still exist in our state, of course, but by no means as extensively as in the 1960s because of a much more vigorous and continuous program of exposure and prosecution. The New Jersey State Commission of Investigation has been credited with an important role in this constant confrontation of organized crime.

I'm told that your fine state of Florida is now faced with a similar type of organized crime prob­lem that plagued New Jersey in 1968. Ironically, many of the key crime figures now "residing" in Florida fled from New Jersey to escape being sub­poenaed and interrogated by the New Jersey S.C.I. We have been told by law enforcement officials that the number of such mobsters who have taken refuge in your state -- suffering from what the press in our state has characterized as the "Jersey Flu" -- number in the 40s.

While we're happy to get rid of this element, I assure you we regret that our good fortune has been at some other jurisdiction's expense. This Jersey Flu exodus from our state is a primary reason why we are constantly urging other states to create an independent crime commission and to adopt new and more powerful anti-crime laws. Our hope is that, some day, organized crime figures under the pressure of vigilant law enforcement that has become too hazardous to their health in their home states will have no place to run for safety and will be forced to stay put and face the music.

5

At this point I want to comment on criticisms that I understana are being aimed at the bill we're discussing -- criticism that also has raised some questions about the New Jersey State Commission of Investigation whose statute is essentially at issue here.

One question is whether the New Jersey S.C.I has been effective against organized crime. Another question is whether we actually have been a reason why so many mobsters have fled from our state to your state -- despite the assertions I have just made that this is what happened.

Such questions and criticisms are not new to us. They were raised in cannonfire fashion in 1975 when a campaign was launched to destroy us -- a campaign that was aborted when a special Governor's Study Committee of judges completed a six-month evaluation in our favor. That Committee not only dismissed such criticisms as unwarranted but attested �o our value as an agency whose investigations and public exposes are a necessary supplement to all of the prosecutorial agencies in our law enforce­ment system. This Committee recommended that we be made a permanent agency.

The criticism I've heard here also runs counter to the reactions to us of many law enforcement authori­ties here in Florida. Almost to a man these offi­cials confirm that the mob migration to your state is in part a fear of our agency's power to subject such crime figures to interrogation and to impri­sonment if they refuse to talk after being granted -- upon careful deliberation by us -- immunity from prosecution.

I would like to point to your state's Organized Crime Control Council report for 1976, which cites our agency and its public documents in a number of places as a factual reference for details about the migration of mobsters from New Jersey to your state.

That report gives the Florida "residency status" of about 100 organized crime figures, and cites our New Jersey S.C.I. records as the reference for the following listings:

6

Two "associates" of the DeCavalcante Family of Central New Jersey -- Frank Cocchiaro, a resident of North Bay Village, and Anthony Russo, a seasonal resident of Hallandale; Anthony Acceturo, an associate of the Gambino family who lived in New Jersey before becoming a resident of Hollywood; the late Vito Genovese; the Genovese family boss who once lived in New Jersey and later in Boca Raton; Antonio Caponigro, now in jail but a former New Jerseyan who had moved to Broward County, and Pasquale A. Macchiarole, a Genovese family member who has been a seasonal resident of Fort Lauderdale, among others.

Cocchiaro, by the way, is the villain of a rather unusual story about a New Jersey mob migration to other states, including Florida. The time is back in 1969 when our Commission was in the midst of its initial series of organized crime confron­tations. Cocchiaro was one of Little Pussy Russo's associates in New Jersey's seashore crime area, was at the New Jersey State House in Trenton under subpoena to testify before the S.C.I. or face civil contempt proceedings.

During the S.C.I. 's proceedings at the Capitol, Cocchiaro left the witness room and went to the State House cafeteria, ostensibly for a cup of coffee. Thus began the longest coffee break in the history of our state for Cocchiaro promptly disappeared. His whereabouts remained a mystery for almost three years. Meantime, a State Grand Jury indictment for criminal contempt was handed up and an arrest warrant based on it was issued.

Then, in April, 1977, an individual who claimed his name was Frank Tagnotta was involved in a traffic accident in North Miami, Florida. After he was stopped and asked to show his driver's license, he became so agitated that he pulled out the "wrong" license -- the one that had the driver's real name of Frank Cocchiaro on it rather than the name of Tagnotta. Cocchiaro subsequently was re­turned to New Jersey, served a prison term on the criminal contempt conviction, after which he finally appeared before the New Jersey S.C.I. and promptly returned to Florida.

The Florida Organized Crime Council also relies heavily on the published reports of the Pennsyl­vania Crime Commission in its annual report for last year, particularly for assembling its list of organized crime figures who are permanent, recent or seasonal residents of Florida.

7

That same Pennsylvania Crime Commission also attributes mob migrations to Pennsylvania from New Jersey to fear of the New Jersey S.C.I. At a special gambling investigation conducted in Bucks County in 1976, the Pennsylvania Commission publicly confirmed the "organized crime gambling operations in Bucks County have become infiltrated over the past several years by persons once promi­nent in similar activities in New Jersey. This in£lux of organized crime figures from New Jersey is a continuing process."

This report said of this mob migration £rom New Jersey to Pennyslvania:

"Many persons considered members of organized crime operations in New Jersey are fearful of being subpoenaed by the New Jersey State Commission of Investigation. That agency has been successful in securing incarceration on contempt charges of witnesses refusing to testify after being granted immunity."

In £act, Pappy Ippolito was questioned as a wit­ness by the Pennsylvaia Crime Commission, which suspected he was the boss of a hugh gambling net­w·ork, the following exchange took place ... Ippolito had explained why he moved from Florida to the Sweetbriar Apartment in Bucks County, Pennsylvania to be close to his son, who livedjust across the river in Trenton.

Q. Why didn't you move to New Jersey?

A. New Jersey? You know why.

Q. I asked you a question.

A. I was a£raid that New Jersey would take mein to answer questions.

Q. Who in New Jersey?

A. The S.C.I.

The 1976 report of the Florida Organized Crime Control Council also devotes almost two pages to the New Jersey Commission's report in 1974 on how Tony Bananas Caponigro - -who was active in numbers and loan sharking -- wound up in jail after his car collided with a federal agent's car. The story noted that Caponigro had fled New Jersey in

8

1970 to avoid an S.C.I. subpoena and was served that subpoena by S.C.I. agents while he was being booked by police after the accident. Our agency, by the way, has declared its intention to call Caponigro as a witness as soon as his federal prison term expires and before he can get back to Florida.

The same Florida Organized Crime Council cites the New Jersey S.C.I. report that at least 11 nine in­dividuals identified by law enforcement authorities as ranking members of organized crime in New Jersey have, in addition to Caponigro, originally fled the state and set up an alternate place of resi­dence to avoid being served S.C.I. subpoenas."

The Florida Council's report noted the S.C.I. statement -- confirmed by Federal and State law enforcement officers that former New Jerseyans who fled to Florida included Emilio 11 the Count" DiGilio, Tino Fiumara, Joseph Paterno, Johnny Keys Simone and Carl Pappy Ippolito. All of these individuals are listed in our records as continuing subjects for surveillance and interrogation.

This confirmed mob migration from New Jersey to Florida has become such common knowledge that even the newspapers in both New Jersey and Florida re­fer to it as a commonplace -- for example: The Miami Herald, which noted as a matter of fact in a news story on June 19, 1977, .thnt the movement of Mafia figures to Florida was made "To avoid subpoenas from the New Jersey S.C.I., which has used its power to jail top-level Mafia figures on contempt charges.

I would like to cover one more point about our relationship with other law enforcement or criminal justice agencies, particularly our relationship to prosecutorial authorities and to grand juries.

Our statewide Grand Jury law was enacted in 1968, as a part of a wide-ranging legislative decision to provide new weapons with which to confront, disrupt and arrest organized crime. The two major features of that 1968 program were the crea­tion of a new Criminal Justice Division to lead and coordinate the prosecutorial effort of the law enforcement system and our State Commission of Investigation as -- in the words of the legis­lative committee that wrote the laws -- "a watch-dog of the entire system itself and special prob­lems such as organized crime and official corruption. 11

9

·we were structured to be more than just a "crimecommission." We were specifically mandated tocomplement and supplement other law enforcementagencies, with civil misconduct also among ourresponsibilities.

In complementing state and county prosecutors and state grand juries, we are following the pattern laid down by those who enacted our law to go into action on the "many occasions when hard-hitting expert fact-finding is needed without involving the criminal process or implying criminal violations are under investigations." And when we do come upon criminal matters we refer them to the proper appropriate prosecutorial official, who, in turn, frequently follows up our public hearings and public reports by obtaining state­wide grand jury indictments and subsequent criminal trials and convictions.

So far as your legislative plan is concerned, I appreciate the background and updating materials and other assistance that I have received from Mark Herron, your Staff Counsel, and from Candy Van Winkle, your Committee Secretary.

I notice that you already have in your bill draft several changes -- conceptual changes for discus­sion purposes, I gather. However, the revision of certain portions of your bill draft -- as ten­tative as they may be -- were certainly heartening to me.

For example, I had intended to urge that you adopt an early amendment to your legislation to make your J?rop9_s ecL CoffiIIli s s i�:t} a �P,,LE .. a.�I:e_3:._t��� a temporary agency. Your original bill, as it

'came to me in Trenton, would have made you an agency with a five-year term, such as our commis­sion, and subject you, therefore, to possible elimination not by an act of the Legislature but merely by the inaction of the Legislature.

Now I have a later version of your bill draft that has the word "temporary" stricken from its phra­seology. The reason I'm nonetheless stressing this type of early-on improvement of your bill draft is because I hope you can avoid, at the very beginning, the burden of a number of statutory imperfections that -- I very seriously warn you will be difficult if not impossible to change once they are in place in an enacted law.

10

Our CoITLmission, for example; has been campaign­ing for enactment of a pending bill to make us permanent for almost two years. Yet this parti­cular legislation was the top priority recommen­dation of that blue-ribbon study committee that evaluated our activities and impact over a period of six months in 1975. This task force of active and retired jurists, headed by the nationally known, but since deceased, Chief Justice Weintraub, was assigned to review our work after a bill was introduced in the State Senate to abolish us. The task force subsequently reported that we were an essential part of the state's law enforcement system and that we not only should be continued on a permanent basis but that our law should be strengthened in several other important respects.

The Weintraub Committee's recommendations that our Commission be made a permanent agency was based on the contention that there is and will be a continuing need for our work. In view of that finding, the Committee made the following condemnation of a temporary agency status:

"The difficulty with a specified limited life is that the quality of staff may be impaired if continuing employment thus depends upon the renewal of the agency. Further, the fact that the agency could be terminated by mere legislative inaction, without a show of hands, could deny the agency the measure of independence needed in the public interest."

Our Commission chairman, Joseph H. Rodriquez, also often stressed the danger inherent in a law that provides that the Commission can be terminated by the inaction rather than by an act of the legislature.

Still another change -- conceptual or otherwise -­has taken place in your bill draft since I first was contacted about visiting with you. That in­volves the compensation to be paid to your com-missioners:·-~··-·-···· - ·

While there are other more substantive matters to discuss, there is no question but that any independent State Commission of Investigation will require the most qualified appointees and anything -- including the rate of compensation -- that will help attract the most honest, capable and objective commissioners as possible has my full endorsement.

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I see that your bill now calls for payment of a $25,000 salary to each of your four Commissioners, as against $15,000 in the bill draft I previously saw. Our Commissioners are receiving compensation of $15,000 each, but that's the same as they were paid back in 1969. I feel that the time certainly has come to bring the compensation of our Commis­sioners up to a more appropriate level, as you are comtemplating at the outset.

As I said, the Weintraub Committee's study sug­gested certain amendments in the S.C.I. law, most of which I personally approve of and which might be helpful to this discussion of a statute very similar to ours. Again I must str�ss the �mportance of trying to improve your enabling legislation before rather than after enactment .•

The Weintraub Committee also suggested that the terms of the four S.C.I. Commissioners be staggered. The Committee's stated reason was that by thus spreading the appointment dates so they would not all reflect the decisions of a single regime, "the agency will be trusted by a_ new administration while still deemed free and unfettered to investi­gate what transpired in a prior administration."

I notice that among conceptual revisions being offered for your bill draft is one that also would provide for � _ _t_r;;:i;:_m5a,, subject to a lottery among the four newly appointed members to be super­vised by your Secretary of State.

I am not certain in my own mind that the method of achieving staggered terms as laid down in this amendment is the best that can be devised but none­theless the important action is to provide for staggered terms now.

In addition to the point laid down by the Wein­traub Committee in New Jersey for recommending staggered terms for our type of agency, there are other potential problems inherent in a system whereby all or most of the four commissioners could find their terms expiring at the same time.

Such a potentially disruptive situation now faces us.

The terms of all four of our Commissioners expire in December, 1978, exactly one year before our second five-year term ends. While some or all of these present Commissioners may be reappointed

12

there remains the possibility that the worst will happen and none will be renamed. Should the latter event come true, our Commission would be launching the critical final year of its second five-year term under the auspices of a transitional neophyte management lacking any familiarity with the agency and with no working knowledge of its past efforts and its past and potential problems.

Again, so far as our Commission terms of office are concerned, the Weintraub Committee found our law to be unclear -- but not defective -- on the holdover status of our Comrnissioners. For the sake of clarity, only -- I must stress·that no one is raising any legal question on this point about our law -- perhaps you should include in your legislation a stipulation that comrnissioners may hold over after the expiration of their terms until their replacements are appointed or they are reappointed.

Another change you might want to consider stems from a waiver procedure we have resorted to in the taking of testimony at private hearings. Our law and your bill provide that at least two of the four Commissioners must be in attendance when testimony is taken at public or private hearings. In our experience, when only one Commissioner was available for this important function, we have obtained the recorded consent of subpoenaed witnesses, through counsel, to the taking of such testimony by a single Commissioner. To date this waiver procedure has not been challenged. But this is not to say that the process is invulnerable. A successful challenge of the process could inflict a serious setback at a crucial period of a future investigation.

You might also wish to consider revising your legislation so it formalizes the procedure bv whichyour Commission would be directed· to conduct· in­quiries by specified individuals. This process is formalized in connection with such a directive by the Legislature, which is required in your bill and in our law to make such a request by passage of a concurrent resolution. As a safeguard against any misimpression or misinterpretation, you may wish to require that any investigatory request "of the governor or of the head of any department, board, bureau, etc." also be formalized by being specified in a written and signed order of instruc­tion.

SMITH:

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I note that the section of your bill referring to "unauthorized disclosure" of certain commission matters has been changed in a later draft from the standpoint of the punishment of the violators. The bill now calls for the punishment of the vio­lations as a third degree felony rather than as a misdemeanor.

I am in full accord with strong penalties for such misconduct. I would favor a stronger approach in our New Jersey law, which limits such a viola­tion to a mere disorderly person charge.

I am impressed by your decision to include our Code of Fair Procedure law_as a part of your Com-

-�is�ici� bf I�vestigation bill, for we have foundthis to be an important set of protective guide­lines -- for both ourselves and witnesses whoappear before us -- in conducting investigationsand hearings in a constitutional manner that safe­guards the rights of all citizens. The onlydifference that I note is that in New Jersey ourCode of Fair Procedure is a separate statuteapplicable to all state investigating agencies.You intend, apparently, to make the provisionsof such a code applicable only to your proposedCommission of Investigation.

In conclusion, I want to stress the importance ofdrafting and adopting a stringent Code of Ethicsand requiring full compliance with it as a con­dition of employment. Our Code prohibits eventhe appearance of a conflict in prescribed sit­uations and is regarded by all other agencies asthe strongest set of ethical standards forofficial behavior in New Jersey's �tate govern­ment.

Thank you, Mr. Chairman.

Mr. Siavage, we certainly appreciate that very detailed and interesting explanation of what you do and reaction to some of the problems that we foresee here with the legislation. I hope while you're in Florida you might get a chance to visit the Southern most county of New Jersey, otherwise known as Dade County. The only reason I cite that because Major Bertucelli -- I visited with him last week -- and he said that your people were calling it that now.

SIAVAGE:

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I have several questions and I know some of the other members of the committee do also. I wanted to get one in 2nd then turn it over to other members.

I can't resist the temptation to ask you this question because it 1 s something that's being discussed so much in Florida and it's something that I feel this committee ought to attempt to make an intelligent recommendation on. We have at least two candidates for governor that are discussing the issue and that is casino gambling. And,of course,a very crucial part of that issue is what it means to Florida in terms of enhancing the activity of organized crime and all of its different facets. So the question that I have for you is: Has your SCI been involved in any way in investigating any preliminary activities of the mob in anticipation of the legalization of casino gambling in Atlantic City? .. If you have any evidence of mob involvement there?

Yes, Mr. Chairman. We were involved in such an investigation on two occasions. We began such an investigation in 1974 when the initial refer­·endum was introduced in New Jersey to make casinogambling legal in several municipalities, allmunicipalities over a particular population.That referendum was defeated and we put the in­vestigation in an inactive status.

When the bill was reintroduced to legalize casino gambling in Atlantic City we began again an or­ganized crime monitoring program a couple of months before the referendum was introduced and passed.

In August of this year we held public hearings in Trenton for four days on the question on whether organized crime was infiltrating any of the por­tions of life in Atlantic City as a result of the passage of the referendum. We dealt with such ancillary services as the vending machine business, gambling schools; we dealt also with an attempt to buy a hotel and various other exemplifications of organized crime infiltration. And we were able by the end of that hearing to draw or depict on charts influence of the Gambino family from New York ru1d the Bruno family from Philadelphia and had Mr. Ralph Salerno comment on the evidence that was adduced at those hearings to the extent that it was obvious that Atlantic City was now

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an open city and that there was an influence of differing organized crime families on dif­ferent aspects of the life of Atlantic City.

Any further questions on that? Dr. Lehman? You want to ask a different kind of question? Go ahead.

Was there antagonism against your statute in New Jersey by state attorneys and/or law enforcement officials and if so why?

When our Commission was initially put into effect it was as a result of a Forsythe Com-mittee report. That committee was really your counterpart seven years ago in New Jersey. It included as witnesses before that cow1nittee several of our county prosecutors which are analogous to your states attorneys and our own Attorney General all of whom were in favor of the passage of this watchdog agency which was initially recommended by the Forsythe Committee.

Now since that time that is not to say that opinions have not been expressed to the contrary by certain officials, law enforcement officials, in the State of New Jersey, but the overwhelming weight of the authority has been, again, exem­plified in the Weintraub Committee report which is that there is a need for a non-criminal inves­tigating agency which makes exposures of wrong­doing and civil misconduct. So what I'm expressing to you is that that cry has not been loud in New Jersey. What you do hear from other states in your position is: aren't your states attorneys or your county prosecutors going to be worried about an overlap or a loss of their authority in some respect? The answer is in New Jersey that has not taken place and I think it's evidenced by the good cooperation that we now have with those county prosecutors.

Mr. Gersten ... If one of your questions is to ask him to distinguish between the function of a grand jury and the function of a State Commission of Investigation, I'll consent to the series.

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Well, thank you very much ... Well, we'll throw that in and we'll comply with your request Mr. Chairman.

Thank you very much for coming down. is a pleasure to see you again.

It really

Getting back to the issue of organized crime activity in gambling in Atlantic City. I wasn't quite clear to what extent your investigations turned up a concerted, conscious effort on the part of OC to infiltrate gambling in Atlantic City.

First let me say that very little they do is un­conscious.

Could I interject this? I think it would help in answering that question. Could you tell us whether or not your casino gambling, whether the legislature has mandated that the casinos would be state run or whether they would be operated by private industry with some kind of a licensing procedure?

Private industry with state licensure.

Very much like we license liquor and horse racing in the State of Florida (inaudible) attempt to regulate it.

That's right. Based on the system that is now in place in Las Vegas, Nevada.

Essentially what our hearings delved into was a movement into ancillary service� for this reason: The casino legislatio� that was passed licenses the people who are going to run the casino or purports to at the appropriate time. Also, I might add, by our urging, they are licensing everybody who deals with the casino hotel complex that is the fellow who does the laundry, who supplies liquor to the hotel, everyone who touches the hotel, casino complex.

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One area that the casino legislation did not cover, however, is whether anything else or anything more stringent is going to be addressed to the ancillaiy services that are not part of a hotel casino complex ... that is, the bar down the street or the hotel across the street who does not have a gambling license. The major emphasis of those public hearings that we held, then, did not deal with, it dealt with an attempt to purchase one hotel, but mostly with ancillary services. As a result of that exemplification we are able to draw patterns of organized crime involvement. For instance, we had evidence through a gambling school that one fellow was told that a certain portion of organized crime from the Northern part of the state, the old Genovese family was going to control the unions. Bruno's family was dealing more in the ancillary services of the vending machines and bars. The Gambino influence was elsewhere. It began to take the shape of a pie.

Then in you opinion there is a concerted effort on the part of OC to take advantage of gambling in ...

Without a doubt.

No question about it?

No question.

Do you think the state will be able to counter­act the infiltration of ancillary services?

The one area of vulnerability at the present time, as we said in our public hearings, was we have strick licensure with regard to the casinos. I don't know whether that licensing process is impervious but I tend to think that it will go a long way to keeping the mob out

_ of hotel ownership. But as I said, the one area of vulnerability is other ancillary ser­vices around the hotel. Angelo Bruno was quoted in our hearings as saying, "I don't want to own a gambling casino. I just want to service it." The first step we took then

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was licensing the people who were going to ser­vice it. The second step we took is to begin to suggest to our state that the licensing re­quirements for other bar businesses, etc. should become more stringent, at least in Atlantic City if not statewide. The answer to your question is no. But I think that the state can begin to rethink many of its licensing procedures so that they can fight that battle.

Thank you.

Moving on to another area very briefly. Would you respond to the criticism directed at the concept of a State S.C.I. that speaks to the issue of executive sessions and secret testimony? The news media is particularly sensitive about this area and there are some that feel that in weighing, doing a balancing act, weights and scales, between freedom of the pres� and the necessary war that has to be waged against or­ganized crime that the scales are not, that the weight is not sufficient to overcome the first amendment argument. Would you offer any suggestions to this committee as to how it should perceive that conflict and how it can be resolved?

Can I interject, inject, an editorial coITLment here?

Mr. Chairman, you are the chair. wish.

You do as you

Thank you. My Rodney Dangerfield syndrome 2cts up every once in a while.

Let me just inject for those that are in the audience that our bill has in it the provision that a lawyer would be permitted within the chambers with the. witness that was called un­like a grand jury. This is also the case in New Jersey,is it not?

That's right.

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So while we're talking about possibly trodding upon the rights of innocent people that's some­thing that we ought to keep in mind.

Mr. Chairman, I would like to point out that a Florida S.C.I. would not trod upon any rights of any innocent people. So that problem is obviated abinitio but I would very much like to hear the response of the gentleman, please.

The interesting thing I think with that issue is that there are a number of constitutional rights that interface. You have the right of the press to know what's going on in the hear­ing room. You have the right of the witness to be protected. You have the right of the individual whose being named by the witness for perhaps something he's not doing to be protected. You have the Commission's right to the information which is essentially the public's right to the information. We, through our experience, however, have had both sides of the issue directed at us, or all sides of that issue. Once in a report we decided not to name names, in a report to the legislature, call the people A, B,C, and D. That was a time when the press took it upon themselves, and quite correctly, to take us to task for not doing that because it was not clear what we were talking about. Another time, numerous other times, we've been sued, for instance, in federal court for civil rights act violations for people alleging that we took them to task for putting into public what should not be put into public.

The important thing to note is, I think, that you can never tell what a witness is going to say in our hearings. He's produced because of a particu­lar reason but when a particular question is asked you really don't know who he's going to name. Most of the objection that we get nor­mally comes from the other side -- why should you give four men the power to put those kind of things into a public hearing? The answer really is that the Commissioner of the S.C.I. _is_ really in a quasi-judicial position. He has to, in essence, balance the scales that you're talking about between whether it's a sufficient public purpose to damage, perhaps, this person's public

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image or whether that public image is really bad enough that the public should know about it. There are many instances, however, when the witness may be lying, he may be overstating a case, he may be mischaracterizing the entire thing and more investigation is required before an intelligent decision can be made on that issue. If the witness is put in public immediately and is allowed unfettered to run that course I would say that your Commission would probably very quickly be in Constitutional difficulty.

Please explain the difference between an S.C.I. and a grand jury.

We have in New Jersey, I planned when the question came up, because I know it was going to come up, to first tell you what we have in New Jersey that you don't have in Florida and that's a Statewide Grand Jury. And we also have 21 county grand juries which are similar, I guess, to your states attorneys grand juries. All of those agencies sit almost continuously. So the first point, I think, is one of fact which illustrates since we've -been successful and since all of them have been successful that there's plenty of work for everybody. That's the first thing.

You said that you had a Statewide Grand Jury.

You meant a statewide prosecutor, did you not?

We have a statewide prosecutor under our Attorney General but he also has sitting continuously a Statewide Grand Jury above all the other county grand juries. And I shouldn't say "above" because it really doesn't supercede those grand juries it just does mostly official corruption work. It was created at the same time we were.

The point is that we are not looking for evidence of a crime. We are looking in the organized crime context to cut through insulation that traditional prosecutorial authorities cannot normally cut through for reasons that I'll talk

about later if you'd like to.

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The second thing that we're looking for is areas of misfeasance, nonfeasance and mal­feasance that don't rise to the level of criminality because as I said before if you set a standard of criminality for the functioning of our public officials or non-criminality then it doesn't say much for the excellence of government. Some of the areas that we look at is where there has been a problem in the administration of government where it doesn't rise to the area of criminality, to an area of criminality. And we make legislative re­commendations, which is important, to the legislature and to the administrative depart­ments on how to solve that problem.

Could an S.C.I. operate effectively in the sunshine without closed door sessions?

No. There's no.question in my mind that they couldn't. I think it would be irresponsible.

Could they operate effectively without the ability to grant immunity?

No.

So both of those are prerequisites to the existence of an S.C.I.?

Clearly they are.

Thank you.

To the best of your knowledge has there ever been a problem with internal security in the S.C.I.?

To the best of my knowledge there has been none. with the exception of a recent situation where there was some information apout what allegedly S.C.I. agents were doing in Atlantic City. I don't know whether that's what you're referring to. That is presently under investigation.

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Actually what I'm referring to is the suggestions that OC has infiltrated the FBI and gotten "x" numbers of people in protective custody in the Marshall's plan taken out, just blown away. And I'm wondering if the S.C.I. is making such a dent in organized crime is as effective as the testimony you offer suggests that,in fact, there'd be an effort on the part of organized crime to infiltrate such a body and if so, have they been successful? What safeguards are there to keep them out? How could they get inside the FBI and not inside the Jersey S.C.I.?

First of all we hire without regard to civil service and we fire also without regard to civil service which is an important provision, I think, within our law and is becoming more and more im­portant as unionization of law enforcement in­creases nationwide. We only have 12 agents and five accountants in addition to four lawyers and myself and a secretarial staff. It's rather easy to control that number of people with re­gard to their integrity.

As I said before we have also the strongest code of ethics in the state and a statute which makes it a disorderly persons offense to talk to anyone.

I have no information whatsoever that that is a problem within the Conunission and is again an expert, a small but expert staff to watchdog other agencies of government is rather easy to control from that standpoint.

Again, what I'm trying to get at is if the S.C.I. is effective it's really going to make life un­comfortable for organized crime in that state. And the more uncomfortable it makes life for or­ganized crime the more they're going to try and do something about it. They're going to try and infiltrate it. They're going to try and compro­mise it. They may even try to hurt members of the staff or the Commissioners. Have you ever directly or indirectly been threatened with physical or other injuries?

Yes.

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To what extent are those threats viable?

I looked at my shirt right before I came in and there was nothing on it ... They're not viable to the extent that none of them have ever been carried out. They're viable to the extent that they get staff members thinking. But it becomes a way of life after a while and most of them are void or voided.

Are staff law enforcement personnel with the ... authority to carry weapons?

Yes, they are all peace officers. carry weapons.

Thank you, Mr. Chairman.

Dr. Lehman ...

They all

Does New Jersey have a RICO statute?

Yes.

Have you any convictions to report under the RICO statute?

Our RICO statute was passed in connection with Atlantic City and it's just recently been put into effect and it does not apply to other areas of the states experience. So we don't have a statewide RICO statute as you do in Florida. So I really have no experience to report under it yet, Doctor.

I wanted to get you to elaborate on one thing again. The distinction between, if you had to explain very simply to people, the distinction between your function and role as an S.C.I. and the function and role of a grand jury. Put them side by side. How would you do that?

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I wanted to get back to that again as I was talking to Committee member Gersten. With re arg to organized crime the grand juries' role is to look into a particular occurrence or a network 9f jnvolv�ment.and decide whether or not to return a grand jury indictment. Our function, and I'd like to refer really to the cooperation that we're involved in now with our county pro­secutors because after a couple of years of our existence the state created a organized crime policy group which is essentially a collection of the county prosecutors who are to discuss how they would implement anti-organized crime activity from a prosecutorial standpoint. We've been invited to sit on that group because there are areas that traditional law enforcement simply cannot break through on. And by that I mean this: When they, for instance, insti­tute a wiretap for a term of 30 days and they realize that there is probably someone who is directing that room of phone sitters, who is taking the money and who is even above the bank for that money. Frustrated, however, they never get to that higher ranking person because the operation is designed so they should not get to him. Often what has happened is we will come in contact with prosecutors who know that Mr. "X" is the boss of this operation or loan sharking operation or whatever it might be in that parti­cular county and they realize that as is the modus operandi of organized crime he is insulated from the street action as it were. And they ask us based on information tha t they have to query him about his operation within that county. So this hand in hand functioning works out very well in �-�:r -�.ate. and our purpose in subpoenaing him is not to find out or convict him of a crime it's to find out exactly how organized crime works, where he fits within the area of involvement and, of course, to take him to task if he does not want to give us that information.

So you feel that you are a very great supportive role for both the statewide grand jury and the local grand juries?

We support them and they support us.

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Perhaps because they come and go and yet your agency is chiseled permanently, or at least temporarily permanently, into the New Jersey Statutes. You can work on an on-going basis. You are perhaps the best rep9sitQf"Y _o_f or_s:_9-nize_d_ cr:Cme-�Informa tion -·in-· the state.

That's right. That's another part of the �om� plementary role. We reeently started a program, for-instance, with counties that did not have, or they didn't think they had, an organized crime program until just recently. We've begun to share resource people with them and talk to them about their problems, the kinds of things that they should be doing and to more generally coordinate with the prosecutors in our state.

Would it be fair to say that in your state that if a grand jury does not issue an indictment that most, all of that information never really be­comes public or may become lost? Is that fair?

That's right. We do have a provision for present­ment in our state but usually if the grand jury procedure begins with the intent of returning an indictment, presentment is not usually returned as an alternative.

What I'm trying to get at is with a State Commis­sion of Investigation -if you did something, exposed, got the kind of information that a grand jury got and yet it was not indictable, yet it was in the public interest, would that not be brought out publicly? What percentage of what you take in, and if you can quantify it, ultimately becomes public, putting the sunshine on organized crime?

First of all, I think it would be somewhat irre­sponsible for us to simply collect intelligence information as some traditional law enforcement agencies have been forced to do because it doesn't rise to the level of a crime. So a large percen­tage of what we do after we evaluate through in­quiry where we want to go, a large percentage of what we eventually do is made public. I'd say as much as 70 to 80%. What happens is we often get information from a county prosecutor who might attempt to return an indictment ar.d finds a very unsavory situation in a county, a story

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that needs to be told, if you will, he then gives us that information and we put on a public hear­ing.

There is something else that I feel that I really can't deny here and that is since we are a watch­dog over the whole criminal justice system we found shortly after our existence that there was a problem in some of our counties in the state. A£ter· all, part of the definitional concept of organized crime is that it can only exist where there's public corruption. Now I'm not calling anybody in Florida corrupt at this point in time.

Well, neither have we.

However, however, it's been proven that you can have successful organized crime in a particular area without official corruption. When we did the investigation on Mr. Russo that I referred to before, we went from the township of Long Branch and each one of the City Commissioners to the Mon­mouth County Prosecutor's Office and the day after we served the subpoena on the Chief of County Detectives he committed suicide. So there have been examples in our state where official corrup­tion has worked hand in hand with organized crime and to deny that, I think,would be naive.

Mr. Kiser ...

On the operation of your committee, how much time would you say is allotted to the organized crime investigations and data and then on other types of stuff? How would you break that out?

I'd have to do it historically. The statute says with particular reference to organized crime so that I would say probably from 1969 up through 1973, I would say approximately 65 to 70% of the agency's work. Then in 1974 we got involved in some differing investigations, investigations as a result of concurrent resolution of the Legisla­ture to do the entire Workman's Compensation sys­tem in the state� for instance, Medicaid investi­gations, and I guess the success that we had with those investigations called for more and more people to give us more and more of that kind of work. The point is that over about an 18 month

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period our emphasis on organized crime began to be diluted so that when we went back to the Legis­lature last year we ijSked them for an additional appropriation or more money to be able to continue our efforts on a daily basis with regard to or­ganized crime. And they've complied with that request so that now I'd say essentially it's about a 50-50 proposition.

Do you feel that having those additional responsi­bilities dilutes your primary goal? 'Cause I'm interested,for example, in seeing to it that on the proposed committee bill that we have, it would appear to me right now that it's pretty well limited to the organized crime activity and I'm just wonder­ing whether or not in your experience you'd recom­mend that we keep it pretty narrow in scope or whether we put that flexibility in latitude in there or perhaps we should limit to only organized crime unless specifically specified by j6int iesolution of the Legislature.

There are several alternatives that you can under­take to use. I frankly like the wide scope that's within our bill. Particularly because there are times when an organized crime or racketeering or public corruption generic investigation can reach out pretty far and touch some people who are not apparently within that network; One of the things that we constantly had challenged was our power to investigate what we were investigating in the beginning. We were taken to task, or we were taken to court, at least, for being able to sup­port what we were doing based on the statute. If you have to use an example that we did, a problem of organized crime controlling the building and maintenance industry in the state of New Jersey, or let's say in Florida, and as one of your first acts you want to bring in somebody who's been extorted by the building maintenance outfit and it's not yet apparent what you're investigating. You then have to illustrate to a court how it's connected to organized crime. Where as if you have a wide ranging statute it becomes only the interest of the commission itself as to what they want to do. I think you can sufficiently communi­cate through a commission where your interests are and what you want them to do to have them do just exactly that. As I said the first three years of our existence we did almost nothing but organized crime and I would assume that a Florida Commission would follow the same pattern.

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Mr. Chairman, if I might continue in that line ...

Go right ahead.

My concern is that we've got several very pressing problems, automobile insurance just being one, and it would be very easy that unless the state really makes that full commitment that we keep trying to urge them to make to combat organized crime it would be cwfully easy to get the strength and the direction of what we want to get done to be diluted right off the bat. I think in your case where the first several years was in that area, there is certainly no guarantee of that and, again, all we need to have is some major issue come out right as this thing is born, for example, automobile insurance, the next thing you know the first real project they get into might be that and then from then on the dye is cast and the primary emphasis is going to be in that area. I think, Mr. Chair­man, my feelings at this time would be to certainly try to keep the scope of our proposed legislation fairly limited to organized crime.

Well, that's something we can take up at the appropriate time.

Do you have any further questions?

Mr. Bowden, do you have any questions?

If I just might, to continue that answer. I think one area ... what you do as far as the scope of the investigation, of course, what the final job of this committee is, or part of it, and with regard to that I would guess that the third portion, "Any matter concerning public peace, safety, or public justice" is one that you might be talking about and although I think that's an arguable point, I think it would be suicidal to take out the provi­sion dealing with public corruption because as I said before there's a definite nexus there.

Let me ask you just briefly about our ... we have a budget of $500,000 appropriation. What kind of funding do you receive from the New Jersey Legis­lature? Do you feel that it's adequate for you to do your job?

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The raise that I was talking about was up to $850,000 during this fiscal year from $675,000 the prior fiscal year. Our request for the coming fiscal year is $906,000. And I wanted to suggest to you that $500,000 is extremely conservative for the hiring of a staff that I would assume would be at least as large as New Jersey's because of the initial start up cost for one thing. Your Commissioners, if you pay them $25,000 are eating up 20% of that budget immediately. So I think that $500,000, by the time you get what you need is extremely conser­vative. I would suggest ... probably based on the fact that you saw our statute which said $400,000 which, however, took into account a surplus at that time of $175,000. But I think, at least, $600,000, probably $700,C00 is a more realistic figure.

I think it would be fair to say that the funding will not be the central issue involved in this legislation.

I had two other questions ... There are some among law enforcement in Florida who have suggested to me that a State Commission of Investigation would be __ just a�othei lev·e1 of laq e�forceITient bureau-. cracy. How would you react to that?

Well, first of all if there's anything that we are I think it's unbureaucratic or nonbureaucratic. We're in the job, really, of watchdogging the bureaucracy. We cooperate with traditional law enforcement but we have no forms that are sent to them nor do they send any to us. We're a totally independent agency aside from the usual workings of government. More in the ombudsman for organized crime nature than an actual part of the government.

What it does provide,though, is some of the good things that statewide services in any area provides. And that is an overview of the entire state and an organized crime problem and an attempt to get through the insulation that exists.

Another suggestion has been made that because of the geography of your state, not bringing in the population, but the geography of it, that you could place several New Jerseys in the state of Florida that it makes it possible for you to have such a cozy_; let me change that word, such a

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comfortable working relationship with the state­wide prosecutor and the other prosecutors in that state. How do you react to that kind of argument? They say that concept would not work in Florida because of the sheer size of this state.

Well, it's a little bit difficult to answer. I guess the answer is none of the prosecutors are my neighbors, they might as well live in Orlando and me in Tallahassee. A working relationship I think comes from an interpersonal relationsnip tri'an any kind·· of geogr-aphical proximity.

By the same token the Commission can exist and can do its job with limited prosecutorial co­operation. So even if that cooperation is slow to be forthcoming at the beginning the Commission can exist and do its job. I don't think it's an argument that negates the need for a Commission because you could not get the cooperation of the prosecutorial authorities, although I would hope that you would have it.

When we were in New Jersey, as you are aware, we talked to Pete Richards who was the Assistant Statewide Prosecutor and, if my memory does not fail me, correct me Aaron and Rep. Gersten, they indicated they had a very cordial relationship with the S.C.I. Is that not correct? Does that still exist?

Yes, it does. Mr. Richards has been there since 1969 when the Commission was started so ... and �e had a good relationship at that time and that relationship still exists. His counterpart with the Statewide Grand Jury, Mr. Steer, is now in charge of the whole division of Criminal Justice. He was just appointed last week, so we're very happy about that.

Let me approach another area which may or may not be outside your field of expertise ...

We'd like to welcome Rep. Crawford here who I want to commend for being here because he is very deathly ill. He's even more pale than I am this week. Thanks for making it.

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Rep. Crawford, this is Michael Siavage, the Executive Director of the S.C.I. and the remarks that you missed thus far, most of which we can produce for you this afternoon because he brought a prepared text.

The issue of a statewide prosecutor has been temporarily put to bed in Florida because the prosecutors, I know this committee entertained that notion for some time, may still again, be­cause the prosecutors banded together and formed what is called the Organized Crime Prosecuting Council which consists of five of them selected by the Governor, they're all state attorneys or perhaps soon will be called district attorneys, I think, they're called district attorneys in New Jersey, and the five of them each,with a chairman, one of them is a chairman, each try to pool their prosecutors and function like a state­wide prosecutor. My question to you is do you think that kind of concept has a great chance for success? For example, each one of them, al­though they do have some small staff, each one of them has to leave his own district and work with the statewide grand jury and the chairman of that particular council in addition to his duties as the state attorney back in his district, he's the finest we have in Florida, must also serve as the advisor to the third statewide grand jurj and has recently also been assigned by the Governor to conduct a special, very .serious, in depth investigation in Bay County. I don't see how three men could do the job. Within that context, how do you think an organized crime prosecuting council could function in lieu of a statewide prosecutor with a permanent staff and a permanent on-going investigative capability?

I don't think there's any comparison. I have to wonder, again, what .those prosecutors would be doing within their own county. I have to also wonder, you know, one of the examples that-we, that I can point to back in our own state is that anytime you fear attention from somebody else, you create a task force to undertake, to answer the problems.

The point is what they're looking at is statewide problems from an individual or county basis. You can't really handle that without statewide authority or statewide jurisdiction and a staff that works with their emphasis statewide. I don't really see the purpose of it except a fear on the part of the local prosecutor that some other autonomy is going

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to be effected and I would say that in American law enforcement that's becoming a thing of the past.

Just out of curiosity did you or, and only be­cause I haven't had the chance to ask him the question, did you or anyone from the S.C.I., to your knowledge, have the opportunity to talk with Ed Austin when he was in New Jersey? Or have you talked with him on any occasion?

I was reminded that somebody on our staff did talk to Mr. Austin but I did not remember his appearance before us myself.

I'd be interested to know who that was at some -time.

Further questions from members of the committee ...

Mr. Crawford, do you have any questions?

OK. Mr. Bowden ...

Mr. Siavage, do you have an opinion as to the nature and extent of organized crime within the state of Florida?

I can only tell you some of the people you have here and what I know from Major Bertucelli in Dade County and the people that you do have here that I know of are not playing Mah Jongg and they are also attracting other people below them, I'm sure, with regard to their organized crime pre­sence in the State of Florida. You have some very heavy hitters here and, again, in talking with Major Bertucelli, he now puts the number at a growing, a much larger number than what we're talking about with high ranking members of organized crime.

I've also seen some of what the media has done in Miami, Dade and Broward County with regard to what's going on as far as your bookmaking and loansharking goes.

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Now the next question, of course, usually is what about the outlying counties? What about counties in which Tallahassee exists and which Orlando exists? The answer to that question is that it won't be long before that kind of problem exists elsewhere, if, in fact, it doesn't already. And I'm sure it probably does in some counties. I just haven't had the time to talk to law enforcement officials from these other counties.

But you have, what is in my mind, a very sub­stantial problem in the State of Florida.

Well, we have heard testimony during the course of the existence of this committee and, believe it or not, even from law enforcement, the question was asked how do you account for this presence that you have alluded to? Some of them try to say· that we ha�e good weather and make other excuses and say, "Well,· these people are retire·a, they are no longer active in our area." Do you believe that to be true?

No I don't. I have my own specific personal knowledge of a number of occurrences that re-late to people fleeing an S.C.I. subpoena and going down to Florida. I also have intelligence data and without subjecting that to the public forum it's clear to me that many, most, if not substantially all of the people who come to Florida remain active in New Jersey and in Florida through a system of courier and message carriers.

Historically, I suppose, New Jersey has had a greater history of organized crime because of the nature of its proximity in the Northeast area. Where would you access the posture of the State of Florida in relation to New Jersey, say some_ five or six years ago? Where are we on the road?

I think that our problem at the time the Commission was created was greater than yours is now because of the entrenchment of those figures since the post war days. But your problem now is getting to the point of where we were in the 1960s. I would say that you are getting probably to the point of prenotice of the ramifications of the problem that you're going to have. You've got all the players in place and I'm sure they're

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making the plans for the carrying out of what they want to do and you're probably getting, also, some spin-off of the placement of those individuals.

Well, then, perhaps, you're suggesting we have not reached maturity as far as the organized crime scheme of things go?

That's right. But that's not to say you don't need to put into place at the state level and at the county level what you need to fight that problem.

Let me approach a subject you've spoken about but it's a very emotional issue and I even spoke to a prosecutor concerning this, a very conser­vative person, been a prosecutor for a long time and having been a prosecutor myself you experience the frustration of knowing in your own mind to, what I call, a moral certainty that a crime has occurred. You make a presentation and it is not an indictable offense because of the burden of

·proof involved. I suggested to this prosecutorthen perhaps it would be well if this scheme,whatever it may be, be exposed through somemedium. He was horrified. He said "You'reholding someone up to public scorn without for­mally accusing them of a crime and, in effect,that's just down right un-American." Now I knowthose charges have been leveled against the S.C.I.in New Jersey and you suggested there has beensome litigation over it. How, have any courtsspoken on the merit of this position?

Yes. Our own Supreme Court has spoken on the merits of this position and the United States Supreme Court has spoken on the merits of our position as has the Third Circuit Court of Appeals. E�sentially they base their decisions, without getting too much of the legalese into my testimony, on two United States Supreme Court decisions. One is Hanna ys. Larch, which says essentially that whe-re a particular commission is not inquiring into t�e commissions of crimes, that is they're looking into an unsavory condition within the society of a particular geographic area that the full panoply of full process rights does not have to be accorded to the witness, that our Code of Fair Procedure is sufficient. Now that's not to �ay that the witness does not have any rights before our committee. He

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has the right to counsel. He has the right to submit questions which the Commission must ask if they're relevant to the inquiry. He has the right to make a statement subsequent to appearing before the Commission which has to be incorporated into the record. Essentially what you don't have is all the things that might subvert the purpose of the Commission's work. The right of cross­examination, for instance, which could carry on a hearing indefinitely. But, again, as a lawyer the only way I know to define constitutional rights is what the nine men who sit in Washington presently say they are and they presently say that our Code of Fair Procedure comports with due process considerations.

Have those cases been in the posture to.where some­one has actually been exposed in a pattern of criminal conduct? In other words, have those been the merits of those cases?

The merits of those cases is a person exposed in an unsavory condition. The one I'm thinking of the person was not later on indicted for their crime.

But nonetheless, the facts you exposed, if true, could have constituted criminal conduct?

That's right. There have been instances of that, although that's not the one I'm thinking of.

Thank you.

I have one more question. I don't think there are any others beyond that.

Particularizing your testimony to my home district in Jacksonville ... Within the last two years we've received testimony, it is a fact, that the Angelo Bruno Mafia family attempted unsuccessfully to purchase two insurance companies. I have dis­covered subsequent to that that within the last six months, perhaps more recently if my memory fails me on that point, the Tacoma, Washington Mafia family sent emissaries to Jacksonville

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Beach to try to make investments, to purchase bars, other business enterprises that would be very good for laundering money and getting a foothold in North Florida. We know that to be a fact. In any of the proceedings before your committee have you heard anything that would tie into that or have you heard of any other activities in which Jacksonville or other parts of North Florida were mentioned as a base of operations or a fertile new field for organized crime?

There are a couple of very interesting ones that come to mind. Unfortunately, we're still involved in one or two of the investigations so I really can't say it in public. There are areas within our Atlantic City hearings that talked about relationships to Florida and Mr. Bruno has talked about his relationship to Florida. That information I would be pleased to give you on a cooperative, private basis rather than at this time. We consistently hear about movement back and forth betwein organized crime figures that we've had under interrogation and ones that are down here now.

To put it a little more vaguely, have you, in fact, heard of operations in Jacksonville and North F lorida?

Yes, I have.

Alright. We're going to at this time move into the next segment of the meeting. Mr. Siavage, I hope you can stay around and perhaps work with the committee in this workshop session on this bill. We may or may not pass it out today. I kind of hope that we will be in a position to do so. I'm going to have to leave for about two minutes and I'll turn the chair over to begin discussion on the bill to our Vice Chairman, Mr. Gersten. Do you have the numbered amendments? Each member of the committee before you? There are presently, I think we have three, that we discussed last time and there are also two more that were suggested by Mr. Siavage but they come up later. I'll be back by the time those two come up. Mr. Gersten ...

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Let's take up proposed co�mittee amendment, there's no nQrnber on it, it's page 4, line 3 to 5, strike to conduct private, public hearings and insert to conduct private, public hearings. Is there any discussion on the amendment? Rep. Crawford? Mr. Lehman? Mr. Kiser?

It's self-explanatory, Mr. Chairman.

I'd be delighted to be able to get through these 2mendments with as little discussion as possible but we don't want to cut anybody off. So if there isn't any discussion are there any movers?

I move the amendment.

OK. Is there any discussion? OK. Is there any dissent? A..nybody wish to be recorded as voting nay? OK. We'll record the first amendment adooted.

Move onto the second 2mend."Tlent, proposed committee amendment, page 3 between lines 4 - 5 insert: Each mewber shall be subject to removal by the Governor for the same reasons as tne state officer ... That's the "£or cause" clause. Is there any discussion of that?

I move it,Mr. Chairman.

OK. Mr. Kiser moves it. Would anybody like to be recorded as voting negative on that? OK, the amendment is shown as passed.

Let's take up the third proposed amendment. On page 2, lines 13 tbrough l 7 strike: two members of the commission shall be appointed one by the Presi­dent of the Senate, other by Speaker of the House for five year terms, Governor shall designate one of his appointees to serve as Chairman of the Com­mission. We're inserting the same clause and then we're moving onto a clause: notwithstanding the provisions of paragraph A, we're staggering the terms. Is there any discussion on the st2ggered terms amenci.ment?

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Mr. Chairman, which amendment is that one now?

That's the third proposed amendment dealing with staggered terms. We'll call on staff. Mr. Herron, would you ...

Excuse me a minute. Is this the one dealing with the ... page 2, lines 13 through 17?

That's correct.

... Whereby now we're going to be injecting the legislature into the appointment process?

Well that was in there, in the bill right now, Mr. Kiser. That is the current wording of the bill.

I misread that then. I only looked at the revised section. I really think that we ought to really question ourselves as to whether or not we want to make these appointments to this commission by somebody other than the Governor. That's one of the problems we frequently get into is invading into the province of the executive and, frankly, I'm not comfortable with having those appointments come one by the Speaker and one by the President of the Senate. I'd just as soon see them all appointed by the Governor myself.

Well, Mr. Kiser, that's a very good point and you may want to draw up an amendment to cover that. I probably would suggest to you at that point the bill wouldn't pass. You know there may be a delicate balancing act that we're going to have to perform. It's going to be strictly political in nature.

I won't offer ... now this bill, when it leaves this committee does it go straight to the floor?

No, it will go to full committee ...

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Criminal Justice? I think I'll wait for it there.

Alright, thank you.

Mr. Lehman.

Mr. Siavage, what do you think about subsection (b)? You alluded to something during your talk that you didn't think this was the best way to do it. How would you do it?

What I alluded to really was the staggering of the terms and doing it by drawing. For instance, there has been some thought in our state of attaching a particular appointment, let's say, for the Speaker of the House to one of the stag­gered terms. In other words, give the Speaker the term which expires eight months from now. Give the President of the Senate the one that expires six months from now and give the Governor the one that expires soonest and latest. There have been several arguments fostered iri favor of that kind of thing because of the underlying con­cept of trying to get the commission to last through one particular administration.

I think multiple appointing authorities, though, is an important aspect of your present bill be­cause what it does is remove the control out of one branch of government.

To make a long story short, do you or do you not advise the rewriting of subsection (b)? Getting down to the nitty gritty.

You mean just with what I referred to as far as how ... I don't think it's important enough for you to rewrite it before you pass it. I think the staggering is more important to pass rather than rewriting the procedure.

Also, one other thing. What about Rep. Kiser's possible objection, how do you feel about that?

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As I addressed myself to multiple appointing authorities I think it's probably the second most important feature of the way our members are appointed. I think the most important thing is bipartisan, in nature, and the second most important facet is the multiple appointing authorities.

OK. Thank you.

Mr. Kiser, did you wish to introduce an amendment?

No, I'm going to debate it in my own mind for a while and decide whether or not that's something I want to live with or whether I want to take action at (inaudible) time.

Mr. Lehman moves the amendment. Is there any debate on the amendment? Does anybody wish to be recorded as voting nay on the amendment? Show the amendment adopted unanimously and I turn the chair back over to Rep. Smith.

Alright, by your vote the amendment is adopted.

Let's go to page three. Mr. Herron, would you discuss briefly that ... Is Mark still with us? Would you discuss that briefly? This is the one on page three, between lines four and five, insert (a) subsection 6 .... They've all passed? Does this include the one on page ... They've all three passed. OK.

Then there were three other amendments. ·we' 11 take up one on page two by Rep., it was drafted by Rep. Gersten but it's not signed. Do you want to acknowledge that it's yours?

Yes, I'll acknowledge that it's mine, Mr. Chairman.

Alright, on page 2, line 26, strike $25,000 and insert $31,000. Rep. Gersten to speak to the money squandering amendment ...

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I'm justing moving in the right direction a little bit more than I did last session (inaudible} ..

Would you use your mike, there?

I got to thinking about what Mr. Siavage said and if that $15,000 figure was brought into Jersey in '69, we've had a 52% increase in the cost of living which would really be about $30,000 -$35,000 now. I also had my attention called to the fact that the Crimes Compensations Commissioners are paid $31,000 and I felt that this function is at least as vital and think we ought to compensate them the most we possibly can to get the most sin­cere, dedicated and competent people to hold that position so for those reasons I would·move that we up the pay scale another $6,000.

Mr. Chairman?

Rep. Kiser ...

Mr. Chairman, I would like to move to lay that amendment on the table 'cause I think it violates every law of aerodynamics that we've all learned to live with here in the legislature that being that if we load it down too much it isn't going to fly.

Rep. Kiser moves to lay the amendment on the table. Call the roll on the motion.

Rep. Crawford?

Rep. Gersten?

No.

Rep. Kiser?

Yes.

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Rep. Lehman?

No.

Rep. Smith?

No.

By your vote the amendment is not laid upon the table. Back to the amendment. Mr. Kiser, would you like to speak against the amendment at this point? Just because you lost that does not necessarily mean the amendment is going to pass and I think you ought to elaborate on your aero­dynamics.

0ell, Mr. C�airman, I think at the last meeting I supported Mr. Gersten's move to raise the salary from $15,000 to $25,000 and I just find that to be a very reasonable number. I think that at that level we can find very good people who will serve and I just think that moving it.on up any higher than that, I personally can't support any­thing higher than $25,000. And I really believe you're going to find this year in the Legislature, even though I have to disagree somewhat with your comments when you said that you didn't think money was going to be a part on this bill that would be discussed much, I've got to believe it still is. I don't believe we're going to be passing any new taxes this year. We're going to be living with an existing revenue and, as you well know, some of the budget we passed last year, some of those revenues were based on nonrecurring monies coming back. So the amount of excess monies we have this year over last year are already going to be substan­tially cut into and even though in the long run moving four commissioners from 25 to 31 really may not be all that much, I just think it's the whole concept and the circumstances around what we're doing that I just don't think, for those people who may be against this, this is going to be a valuable way to grab a toe hold and go against the bill and I just don't want to give them that. I think 25 is a respectable level and I think we can live with it.

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If this were an appropriate forum to do so, I would move that your remarks for crime fighting and for frugality in goverment be spread upon the Congressional Record, but it's not.

I would like to say that the reason I mentioned the money thing, I think that the reasons for opposition to the bill might well be couched in money terms but I'm not sure that would be valid reasoning.

Rep. Gersten to close ...

I'd like to thank Mr. Kiser for his very thoroughly Republican observations and tell him I appreciate his concern for the bill and would just like to advise him that we can always amend it down at any other point in the process right through to the Senate if it has to be to see this bill moved but I think when we're starting with it we ought to come out with the strongest possible bill we can. There really isn't any reason to compromise our­selves right now we can trade off later if we have to. I don't think a matter of $6,000 is going to mean the passage or the defeat of the measure and, as such, Mr. Chairman, I would res­pectfully move the bill, the amendment.

I want to make this somewhat �nformal because Mr. Siavage is here to share his expertise with us. What kind of people have you been able to get at the $15,000 salary? Is it a part time job for lawyers, the commissioners' job? in your state?

Our job of a commissioner is a, they serve on a part time basis. However, we've been able to find a reasonably, a very good group of people. That may be because many of the ones that we�e hired initially stayed on for quite a long period of time and became more attached to the commission than they did the pay check and there is some feeling on our part, that is staff's part, that they should be making a lot more money. The commissioners are men of good will who are not going to suggest that to the legislature themselves but staff will probably be making some kind of suggestion of that nature in the next legislative session up close to the kind of figure you're discussing now.

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Rep. Gersten moves the adoption of the amendment. Call the role on the amendment.

Rep. Crawford?

Yes.

Rep. Gersten?

Yes.

Rep. Kiser?

No.

Rep. Lehman?

Yes.

Rep. Smith?

No.

By your vote the amendment is adopted.

The next amendment, on page 4, line 19, strike the period and insert: provided, however, that when only one commissioner is available for the purpose of taking testimony the subpoenaed wit­ness may consent by recorded waiver to the taking of testimony before a single commissioner. This was the amendment suggested by Mr. Siavage and Rep. Crawford is offering that amendment, I hope. Discussion to the amendment ... Is that basically, Mr. Siavage, comply with the suggestion that you made?

Yes, it does. I don't really know whether it would be necessary, since you've taken the requirement of two commissioners out, to require the waiver. You could just simply make it that it would have

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45

the power to take testimony with one commissioner. We've been getting around it by waiver. The lan­guage, I guess, is unimportant. It means the same thing ... If I make myself understood.

Mr. Herron, you want to comment to that?

Well, I think the amendment as drafted states a general rule that it has to be by two members. However, the witness can consent to such a waiver. When I drafted the amendment, that's the way I drafted it. It would not be a general rule as one commissioner. It would be general, two, by recorded waiver, one.

I understand that, it might be better to keep it that way.

I have a question, Mr. _Chairma::-i, if I may?

Go ahead.

You say a waiver, of course, if the witness is hostile and you don't have enough commissioners available, he could refuse to waive and you're aborted.

I'll tell you why ... Usually, I'll tell you why I don't completely agree with you. Usually, even though the witness is hostile he knows that you're going to get him into session sooner or later and often times the reason you have one commissioner is an (inaudible) circumstance. So when the wit­ness is told "You have a right to have two com­missioners present and we only have one today so if you want to come back next week at the same time, we'll proceed with two. But if you want to waive today, we'll go ahead with one." And even if they're hostile they're usually going to say OK.

Well, is there any magic to the number two? Why hot one as you suggested? Why two?

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I imagine the rationale is, when you have four commissioners two is as close to, they're talking about a majority, really. It's arguable whether two is a majority of four, but that's the idea behind it.

That's all I have Mr. Chairman.

Any further discussion on Rep. Crawford's amendment?

Rep. Crawford moves the adoption of the amendment. Without objection show it adopted.

The next amendment on page 5, lines 4 - 6, strike all of said lines and insert: 11.706--Investigation of management or affairs of state department or agency. At the direction of the legislature by concurrent resolution or at the request of the Governor or of ... Mr. Herron, you prepared that based on what Mr. Siavage has suggested. You want to comment to that? That should be at the written request of the Governor. You want to comment to that?

Mr. Siavage's remarks, he proposed that the request by an agency head or the Governor needed to be recorded for something to refer back to ... (rest of remarks inaudible - microphone inoperative)

So essentially all Rep. Gersten is doing in this amendment he's offered is to insert the word written so in the event the Governor or the agency head might want to do that orally, it would have to be in writing?

That's right.

Any comment to that? It's a motherhood amendment. Change that, we'll make Rep. Kiser sponsor of that, he's going to need a lot of help there.

Rep. Kiser moves the adoption of the amendment. Without objection show the amendment adopted.

KISER:

SMITH:

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47

The next amendment is by Rep. Kiser. It's on page 12, line 14, strike section 2 and insert and renumber subsections accor_dingly ... we' re not really striking section 2, the new section 2 he wants in there would be: The provisions of Chapter 120, Florida Statutes shall not apply to the commission. Rep. Kiser to explain the amendment ...

It may not be drafted the way it technically needs to be but the intent is I want to make sure that the commission is not subject to the provisions of administrative procedures act and the way we've been interpreting this thing lately is that unless the statutes or bill specifically exclude 120, the Administrative Procedures Act, you're deemed to be included.

Mr. Chairman, I withdraw that amendment, Mark just pointed out it's already in there. I looked for it and I didn't see it.

I thought it was in the bill. The only other question that I might have is reacting to the civil service question that was brought forth by Mr. Siavage. Mark, do you think we've got a problem with that, the necessity of the com­mission being able to have unquestioned loyalty from their staff? That's a bad word to use, loyalty, trust.

I'm not sure about whether you're going to have a problem or not. In some of the discussions we've had today it's sort of muddled my opinion. I thought the commission was going to be part of the legislative branch and as such they would not be subject to civil service because they perform a legislative function rather than a judicial or executive function. Being a part of the legisla­tive branch they wouldn't be subject to _civil service.

Let me ask that, whatever we do with the bill today, that you try to research that point before our next meeting. If it is a problem it could be amended in the Committee on Criminal Justice. I think it may have a dual reference.

An amendment on page 12, line 15 by Rep. Gersten, strike $500,000 insert $750,000. Rep. Gersten to the amendment ...

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48

I'm just merely responding once again to Mr. Siavage's brilliant �naudible) for sufficient staff.

Other discussion on the amendment? Mr. Kiser? Any further discussion on the amendment? Call the roll on the amendment ... Rep. Gersten moves the amendment.

Mr. Chairman, may I ask one question?

OK, question ...

At $500,000, at a half a million dollars, what is that intended to fund at that level?

Alright, let me call on our staff attorney to discuss the $500,000 figure. You will recall that in a bit of battle in this committee the salaries were raised some $16,000, I'm sorry, yes, -some $16,000 per commissioner times three is $48,000. Mark, if you would comment to the $500,000 figure.

The $500,000 figure was not drafted (inaudible) The initial New Jersey act provided an appropri­ation of $500,000 ...

In 1969 ... Alright. I'll tell you what I'd like to ask at this point is Mr. Siavage if you could send us a break down of your expenditures over the years, how money was used and so forth because we are going to have to defend this bill. Hope­fully we'll be on the offensive but we may have to send in the defensive team before Appropriations. So it may be whether we come up with $500,000 or $750,000 or $50.62 may be academic before this committee.

I'd be happy to do that Mr. Chairman but I think because I'm painfully aware now in my new job of budgetary considerations of our commission I could help you a little bit already. I think with start off costs, rent, vehicles, office equipment, hiring secretaries, et cetera, that on $500,000 you're probably talking about a staff, aside from the executive director and the commissioner, who you're

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49

now paying $125,000 out of that $500,000 to, of about eight to nine people and I think that's relatively small for the size of the State of Florida.

Well, it would be my intention to house them in the old capitol to keep Secretary Smathers com­pany. Do you have a comment?

I was just going to say Mr. Chairman, that I,

contrary to what some of the drift of the feeling might be, I'm not opposed to raising that amount at all. I do agree in this instance that $500,000 probably is limited, but I think, again, we really need to know what sort of a staff that would pro­vide because those questions are going to come. How many investigators? How many attorneys? How many secretaries? All that's going to come up and we need to know.

We'll get that information. Perhaps you can get it to us in the next couple of weeks. We'd cer­tainly appreciate it.

Sure.

I would have asked for a million and a half or two but (inaudible). But what I'm trying to demonstrate is commitment, a major coITLmitment on the part of the state to try and make a dent in organized crime and if we could put two or three more investigators on, buy (inaudible) equipment (inaudible) that's a message to organ­ized crime that we mean business.

I think the unfortunate thing is that we will have difficulty convincing a lot of people of the cost benefit ratio of the dollars expended here. I'm convinced of it and I think most of the people of this committee are, but it's not something that can be proven in black and white, at least not until we get our information back on the cigarette tax.

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To the amendment, any further discussion? If not, Rep. Gersten moves the amendment - strike $500,000, insert $750,000. Call the roll on the amendment ...

Rep. Crawford?

Yes.

Rep. Gersten?

Yes.

Rep. Kiser?

Yes.

Rep. Lehman?

Yes.

Rep. Smith?

Yes.

By your vote show the amendment adopted.

Are there any further amendments to the bill? Mr. Herron?

There's one further amendment which we discussed last time and that was with regard to the two penalty provisions. The penalty provisions on page 7 is a felony of the third degree. The penalty provision for almost identical conduct on pages 11 and 12 is a misdemeanor of the first degree. Candy has a proposed amendment there

which didn't make it into concept amendments accepted earlier that proposes to combine the two crimes and make them a felony of the third

SMITH:

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51

degree. And the crime is for the unlawful dis­closure of the name of any witness who testifies at a private hearing or any evidence which is given by that witness.

Alright, let's first, Mark, explain generally what those amendments do. �he first one strikes all of the lines on page 11, 20 - 29. These are to be taken together?

Right. It's an amendment in two parts because the two parts that are in the bill speak to similar, if not the same conduct, if my understanding of the New Jersey provisions are correct. One is in the Code of Fair Conduct and the other one is in the text of the Commission of Investigation bill.

The crux of the issue is going to be, members of the committee, that instead of slapping it away with a fly swatter with a misdemeanor two, or mis­demeanor one, any of these offenses would be a felony of the third degree which would be a five year term max. That's going to be the crux. Now if someone would like to offer this amendment or I'll leave the chair and offer it, either way.

I' 11 offer it.

Dr. Lehm2n offers the amendment on page 7, lines 13 through 20, strike all of said lines and in­sert ( 1) (a) except as otherwise provided in this subsection if any member of the commission, its counsel or any employee disseminates or makes available to the public the name of any witness examined or any testimony or other evidence adduced at a private hearing or a preliminary conference or interview conducted before one or more members of the commission, its counsel or staff, such mem­ber of the com.�ission, counsel or employee commits an offense. (b) Whoever violates the prov is ions of this subsection shall be guilty of a felony of the third degree punishable as provided in the Florida Statutes. (c) The provisions of this sub­section shall not apply in cases where the dissemi­nation or public availability occurs in the course of a subsequent hearing which is open to the public or is authorized by a majority of the members of the commission.

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Speaking to the amendment ... Anyone to the amend­ment? Rep. Lehman moves the amendment. Call the roll on the amendment.

Rep. Crawford?

Yes.

Rep. Gersten?

Yes.

Rep. Kiser?

No.

Rep. Lehman?

Yes.

Rep. Smith?

Yes.

By your vote the amendment passes.

The other is a technical amendment, on page 11 lines 20 through 29, strike all of said lines. This makes both penalties felonies three. Dr. Lehman moves the amendment. Do you want to record the same vote? We record the same vote for that amendment. OK.

Are there any other amendments by members of the cornrni ttee ?

Dr. Lehman is recognized for the purpose of making a motion.

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53

I move (inaudible) that·this second draft as amended today be adopted as a committee draft and be sent to bill drafting.

Dr. Lehman moves the adoption of a co��ittee bill by the Select Committee on Organized Crime creating a State Commission of Investigation. Discussion to the bill itself ... Rep. Kiser.

Mr. Chairman, I'd like to (inaudible) I'd very much like to speak in favor of sending the bill through. I think that it's very fitting that we're now in our second year of work in this area and I think we're charting a course here that shows that the Legislature is going on re­cord, or at least our committee is, to get into fighting organized crime in a very serious way. We've all talked about wanting the state to make the commitment in this area and I think it shows that this work product will make that commitment for the state and I just hope we can get the whole House to charge forward with it, right along with it, and hopefully move it out and get it down to the Senate the first week or two and we can spend the rest of our time lobbying the Senate as to why we need to make the commit­ment in this area to fight organized crime.

I want to relinquish the chair to Rep. Gersten so that I can make about two minutes of remarks. _;1',m

I recognized?

You're recognized, Mr. Smith.

From the very beginning of this committee we have had from cime to time some meaningful dialogue and some disagreements on various points, but I think all of us have had a oneness of mind that organized crime is perhaps the single, probably the single most threatening spectre in the State of Florida ... Even more so, perhaps, than the energy crisis, jobs and so forth, because it's so intertwined in the very fabric of our lives and lifestyle in the State of Florida. We tried, unsuccessfully, as hard as I think a committee could try last session to chisel into the statutes and on-going effort against organized crime. We passed three times in this House a Joint House/ Senate Select Committee on Organized Crime to

GERSTEN:

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54

work with our colleagues to carry on the work of this committee which we knew from the very beginning would not be finished in a mere one year life span. We were not successful. This year we're trying an approach that has worked and it has worked effectively - A State Commission of Investigation. It has been, not a bureaucracy growing like topsy, but it's been a very effective unit. It's not just a boast of the State of New Jersey that it has worked in making a significant dent in mob activity, it is a fact corroborated by our own very excellent law enforcement agencies around this State of Florida. So we are going that route and I think with a lot of dedication on the part of each of us as committee members we can pass this legislation or perhaps know the reason why. I've talked with Speaker Tucker and the Chairman of our parent committee, the Criminal Justice Committee in the House, Ralph Haben, and I have a commitment from both of them, conceptually, a very voluntary commitment to help us pass this bill. I've talked with Senator Dunn in the Senate who reacted very favorably from his Judiciary-Criminal Committee and I plan to talk with Senator Brantley. So when this bill passes I'm going to be very proud of the work of this committee and the heaviest part of our work, as you know, still lies ahead. So with that, those are my remarks and if there are no further remarks, we'll go ahead and move the bill.

Just very briefly, Mr. Chairman, I'd like to thank Mr. Siavage for coming down and being· witness to what I think is going to be the creation of this committee and I hope we're going to give birth to an on-going entity that will live long after us and make a major dent in organized crime in the State of Florida and I thoroughly concur with our Chair­man.

Assuming that this bill gets out of committee and passes the House, would you be willing to come· down again and appear before the Senate because they're hard heads?

Any time you'd like me ...

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55

Dr. Lehman didn't really say ... he was just kidding. That's one thing I've always admired about Senator Brantley, he's got a wonderfully developed sense of humor. If one of us says the Senate is hard heads, he'd know we're just kidding.

Mr. Chairman, I think we should ask Mr. Siavage if he would consider being the first Executive Director ...

I hope to be talking to my counterpart in the State of Florida in 18 months to a year.

For 15,000 bucks.

Well, we will ... Dr. Lehman has moved the bill. Call the roll on the bill to chisel an on-going mechanism for fighting organized crime into the Florida Statutes.

Rep. Crawford?

Yes.

Rep. Gersten?

Yes.

Rep. Kiser?

Yes.

Rep. Lehman?

Yes.

Rep. Smith?

SMITH:

KISER:

56

Yes.

By your vote, the bill is adopted.

Now before we take the motion to rise let me make this observation to the members of the committee .. For our report to be effective and to be the kind of polished report that I think it must be we've got to publish it to the members of the Legislature before committee meetings and I'm talking about March 1. I don't want this to be a product of staff, exclusively. I don't want it to be a pro­duct of me, exclusively, you've seen what happened when you let that take place. So I'm going to urge you for the fourth time to communicate with myself or Aaron or Mark in writing or orally, it doesn't have to be typewritten, things that you'd like to see reflected in that report and things, legislation that you would like to recommend in that report so that when we present the final draft it will reflect that. I fully intend to have a section, if necessary, in the report for dissenting or differing views of the members of the committee. You know it's not essential that we have a oneness of mind. And then when we have that report and we can begin individually talking with our House colleagues and our Senators we can have a very good movement and it will be a lot like the great Green Bay power sweep, you can see it coming but you just can't do anything about it.

By the way I've got to say this plug, the Organized Crime Institute in Miami is making available their staff and their research facilities to assist us in the preparation of our report. We owe a great debt to them for the work that they're doing.

Rep. Gersten moves we rise.

Mr. Chairman, hold it, before we do that, let me ask a question. What is the latest on the United States Senate Committee? I saw something in the newspaper that said that they would be meeting in Miami, I think it was Senator Chiles, I believe, made some comment that the Senate was creating a subcommittee on organized crime which he was going to be chair�ng and they were going to be holding some meetings in South Florida and I would like, if that's the case, Mr. Chairman, I'd like to seek approval from the Speaker for this committee to go and set in and be in attendance on the days that those meet for all of us, Mr. Chairman, so that we can all be in attendance at those meetings and see what they do at a federal level.

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57

Major Bertucelli told me he would advise us in advance. What I'm going to do is take your suggestion which is a good one and get Mr. Bowden to draft such a letter to Senator Chiles for the Committee, I'll sign it, stipulating that, to the Speaker, also, that if we go Rep. Gersten would receive no per diem.

Rep. Gersten moves we rise.

History of Legislation

1977 Regular Session

Florida Legislature

prepared by:

��

Legislative Information Division

�ht� Uu�

RULES AND CALENDAR RULES AND CALENDAR

Joint Legislative Management Committee Holland Bldg. Rm. 94 · 488-4371

,--�

07/22/77 SENATE BILL ACTIONS REPORT PAGE 323

S 0954

S 0955

S 0956

S 0957

GENERAL BILL BY RENICK (IOENTJCAL H 10701

AUTOMOTIVE REPAIR; CREATES AUTO REPAIR ACT & BUREAU OF AUTO REPAIR IN

CONSUMER SERVICES OIV. OF AGRICULTURE & CONSUMER SERVICES DEPT. TO

ADMINISTER ACT UNDER DIV.; PROVIDES FOR APPOINTMENT OF BUREAU CHIEF,

POWERS & DUTIES OF DIRECTOR, ETC. EFFECTIVE DATE: 07/01/77.

04/26/77 SENATE INTRODUCED, REFERRED TO COMMERCE, GOVERNMENTAL

05/10/77 SENATE

05/24/77 SENATE

06/03/77 SENATE

OPERATIONS, APPROPRIATIONS -SJ 10222

EXTENSION OF TIME GRANTED COMMITTEE COMMERCE -SJ 00367

EXTENSION OF TIME GRANTED COMMITTEE COMMERCE -SJ 00501

DIED IN COMMITTEE ON COMMERCE

GENERAL BILL BY SAYLER

COLLECTION OF AO VALOREM TAX; AUTHORIZES TAXPAYER TO MAKE PAYMENT OF

SAID TAXES IN INSTALLMENTS; PROVIDES FOR INITIAL PAYMENT WHEN CHOOSING

INSTALLMENT OPTION; PROVIDES THAT DISCOUNTS NOT APPLY WHEN INSTALLMENT

PAYMENTS ARE ELECTED & THAT REVENUE DEPT. ISSUE RULES & PREPARE

NECESSARY FORMS. EFFECTIVE DATE: 10/01/77.

04/26/77 SENATE INTRODUCED, REFERRED TO FINANCE, TAXATION AND CLAIMS

-SJ 00222

05/06/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE FINANCE, TAXATION

AND CLAIMS -SJ 00339

05/18/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE FINANCE, TAXATION

AND CLAIMS -SJ 00429

06/03/77 SENATE DIED IN COMMITTEE ON FINANCE, TAXATION ANO CLAIMS

GENERAL BILL BY TRASK (COMPARE ENG/S 0690)

VETERINARY MEDICAL PRACTICE ACT; ELIMINATES RESTRICTION ON APPOINTMENT

TO STATE BOARD OF VETERINARY MEDICINE OF LICENSED DOCTORS OF VETERINARY

MEDICINE WHO GRADUATED FROM SAME COLLEGE. AMENDS 474.041.

EFFECTIVE DATE: UPON BECOMING LAW.

04/26/77 SENATE INTRODUCED, REFERRED TO AGRICULTURE -SJ OJ222

05/10/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE AGRICULTURE

-SJ 00386

06/03/77 SENATE DIED IN COMMITTEE, IOEN./SIM./COMPARE BILL PASSED,

REFER TO S 690 (CH. 77-144)

GENERAL BILL BY WILLIAMSON (IDENTICAL H 05881

CONSTRUCTION INDUSTRY; REQUIRES APPLICANTS FOR REGISTRATION OR

CERTIFICATION BY FLA. CONSTRUCTION INDUSTRY LICENSING BO. FURNISH

PAYMENT BONDS AGAINST CERTAIN CLAIMS, ETC. AMENDS 468.105, .106,

REPEALS 713.02(61, .23. EFFECTIVE DATE: 10/01/77.

04/26/77 SENATE INTRODUCED, REFERRED TO COMMERCE -SJ 00223

05/10/77 SENATE EXTENSION OF TIME GRANTEO COMMITTEE COMMERCE -SJ 00367

05/24/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE COMMERCE -SJ 00501

06/03/77 SENATE DIED IN COMMITTEE ON COMMERCE

S 0958 GENERAL BILL BY TRANSPORTATION (COMPARE S 0903, H 1670)

UNIFORM TRAFFIC CONTROL; PROVIDES VEHICLE OWNER IS LIABLE FOR PAYMENT OF

PARKING TICKET VIOLATIONS UNLESS VEHICLE WAS STOLEN, ETC.; PROVIDES

FAILURE OR REFUSAL TO COMPLY WITH ORDER OF POLICE OFFICER OR MEMBER OF

FIRE DEPT. RE TRAFFIC CONTROL IS MISDEMEANOR, ETC. AMENDS CH. 316,

318.17. EFFECTIVE DATE: 10/01/77.

04/26/77 SENATE INTRODUCED, REFERRED TO JUDICIARY-CRIMINAL -SJ 00223

05/03/77 SENATE COMM. REPORT: FAVORABLE, PLACED ON CALENDAR BY

CONTINUED ON NEXT PAGE

07/22/77 SENATE BILL ACTIONS REPORT

05/03/77 JUDICIARY-CRIMINAL -SJ 00325

PAGE 324

05/09/77 SENATE PLACED ON SPECIAL ORDER CALENDAR -SJ 00349; PASSED;

YEAS 38 NAYS O -SJ 00353

05/13/77 HOUSE RECEIVED, REFERRED TO TRANSPORTATION -HJ 00558

05/25/77 HOUSE COMM. REPORT: FAVORABLE, PLACED ON CALENDAR BY

TRANSPORTATION -HJ 00765

06/02/77 HOUSE PEAD SECOND TIME; AMENDMENTS ADOPTED; READ THIRD TIME;

PASSED AS AMENDED; YEAS 110 NAYS O -HJ 01054

06/02/77 SENATE CONCURRED; PASSED AS AMENDED; YEAS 31 NAYS 0

-SJ 00794

06/16/77 SENATE SIGNED BY OFFICERS ANO PRESENTED TO GCVERNOR

06/30/77 APPROVEO BY GOVERNOR CHAPTER NO. 77-456

S 0959 GENERAL BILL BY SAYLER ANO OTHERS (COMPARE H 13141

FIREMEN & POLICE/PENSIONS; PROVIDES FOR INCLUSION OF RESCUE PERSONNEL IN

DEFINITION OF •FIREMAN•; REMOVES LIMITATION ON EXPENDITURE OF TRUST FUND

MONEYS BY INSURANCE DEPT. IN ADMINISTERING ACT; REQUIRES DEPT. TO

WITHHOLD STATE FUNDS FROM NONCOMPLYING MUNICIPAL'TIES, ETC. AMENDS CHS.

175, 185 APPROPRIATION. EFFECTIVE DATE: 07/01/77.

04/26/77 SENATE INTRODUCED, REFERRED TQ PERSONNEL, RETIREMENT AND

COLLECTIVE BARGAINING -SJ 00223

05/06/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE PERSONNEL,

RETIREMENT ANO COLLECTIVE BARGAINING -SJ 00339

05/18/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE PERSONNEL,

RETIREMENT ANO COLLECTIVE BARGAINING -SJ 00429

05/27/77 SENATE EXTENSION OF TIME GRANTED COMMITTEE PERSONNEL,

RETIREMENT ANO COLLECTIVE BARGAINING -SJ 00553

06/03/77 SENATE DIED IN COMMITTEE ON PERSONNEL, RETIREMENT ANO

COLLECTIVE BARGAINING

S 0960 GENERAL BILL BY JUDICIARY-CRIMINAL I SIMILAR ENG/H 2127)

(CS/CSl ORGANIZED CRIME; MAKES IT UNLAWFUL TO USE OR INVEST PROCEEDS

FROM PATTERN OF RACKETEERING ACTIVITY OR FROM COLLECTION OF UNLAWFUL

DEBT TO ACQUIRE OR MAINTAIN INTEREST IN, OR ESTABLISH OR CONDUCT ENTERPRISE, INCLUDING REAL PROPERTY; PROVIDES AFFIRMATIVE DEFENSE, ETC.

AMENDS 905.34. EFFECTIVE DATE: 10/01/77.

04/25/77 SENATE INTRODUCED, REFERRED TO JUDICIARY-CRIMINAL -SJ 00220

04/26/77 SENATE COMM. REPORT: C/S PLACED ON CALENDAR BY

JUDICIARY-CRIMINAL -SJ 00276

05/02/77 SENATE PLACED ON SPECIAL ORDER CALENDAR -SJ 00301; C/S READ

FIRST ANO SECOND TIME -SJ 00302

05/04/77 SENATE PLACED ON SPECIAL ORDER CALENDAR -SJ 00324; AMENDMENTS

AOOPTEO -SJ 00326; WITHDRAWN FROM CALENDAR, RECOMMITTED

TO JUDICIARY-CRIMINAL -SJ 00327

05/09/77 SENATE CO�M. REPORT: C/S FOR C/S PLACED ON CALENDAR BY

JUDICIARY-CRIMINAL -SJ 00375

05/26/77 SENATE LAID ON TABLE UNDER RULE, IOEN./SIM./COMPARE BILL

PASSED, REFER TO H 2127 (CH. 77-3341 -SJ 00545

S 0961 GENERAL BILL BY CASTOR IIOENTICAL H 15021

PUBLIC MEETINGS; PROHIBITS PUBLIC MEETINGS FROM CERTAIN LOCATIONS.

AMENDS 286.011. EFFECTIVE DATE: UPON BECOMING LAW.

04/26/77 SENATE INTRODUCED, REFERRED TO ECONOMIC, CO�l'IJNITY ANO

CONSUMER AFFAIRS, GOVERNMENTAL OPERATIONS, RULES ANO

CONTINUED ON NEXT PAGE

J7/22/77 HOUSE BTLL ACTIONS REPORT PAGE 503

H 2126

H 2127

05/18/77 HOUSE CO�M. REPORT: FAVORABLE BY FINANCE ANO TAXATION

-HJ 00623; NOW REFERRED TO APPROPRIATIONS

06/03/77 HOUSE DIED IN COMMITTEE ON APPROPRIATIONS

06/29/77 REFER TO S 17A (SPECIAL SESSION) CH. 77-405

LCCAL BILL BY HODGES

TAYLCR/O!XIE COS./SPONGES; PERMITS CERTAIN FISHING SPONGES OF LEGAL SIZE IN TAYLOR OR DIXIE COUNTIES,

MfTHOCS RE TAKING EFFECTIVE DATE:

07/03177.

04/26/77 HOUSE

04/28/77 HOUSE

05/31/77 HOUSE

06/01/77 HOUSE

06/02/77 SE"IATE

06/03/77 SENATE 06 / l 7 / 77 HOUSE

07/03/77

INTRODUCED, REFERRED TO COMMUNITY AFFAIRS, NATURAL

RESOURCES -HJ 00366

WITHDRAWN FROM- NATURAL RESOURCES -HJ 00386 COMM. REPORT: FAVORABLE, PLACED ON CALENDAR BY COMMUNITY AFFAIRS -HJ 00939

READ SECOND TIME; READ THIRD TIME; PASSED; YEAS 119

NAYS O -HJ 00980 AECFIVED, REFERRED TO RULES ANC CALENDAR -SJ 00734;

CONSIDERED, PLACED ON LOCAL CALENDAR BY RULES ANO

CALENDAR -SPJ 00001 PASSED; YEAS 33 NAYS O -SPJ 00026

SIGNED BY OFFICERS ANO PRESENTED TO GOVERNOR

BECAME LAW WITHOUT GOVERNOR'S SIGNATURE

CHAPTER NO. 77-660

GENERAL BILL BY CRIMINAL JUSTICE, SELECT COMMITTEE ON ORGANIZED CRIME,

NELSON, RICHARD, SMITH AND OTHERS (SIMILAR CS/S 09601

ORGANIZED CRIME; MAKES IT UNLAWFUL TO USE OR INVEST PROCEEDS FROM

PATTERN OF RACKETEERING CONDUCT OR FROM COLLECTION OF UNLAWFUL DEBT TO ACQUIRE OR MAINTAIN INTEREST IN, OR ESTABLISH OR CONDUCT AN ENTERPRISE,

INCLUDING REAL PROPERTY, ETC. AMENDS 905,34. EFFECTIVE DATE: 10/01/77.

04/26/77 HOUSE INTRODUC�O, PLACED ON CALENDAR -HJ 00367 05/02/77 HOUSE READ SECOND TIME; AMENDMENTS ADOPTED -HJ 00405

05/04/77 HOUSE READ THIRD TIME; PASSED AS AMENDED; YEAS 114 NAYS

-HJ 0041605/06/77 SENATE RECEIVED, REFERRED TO JUDICIARY-CRIMINAL,

JUDICIARY-CIVIL -SJ 00335

05/09/77 SENATE COMM. RCPQRT: FAVORABLE WITH AMEND, BY

JUDICIARY-CRIMINAL

05/12/77 SENATE NOW REF�RREO TO JUDICIARY-CIVIL -SJ 00375

0

05/20/77 SENATE COMM. RCPORT: FAVORABLE WITH AMEND., PLACED ON CALENDAR BY JUDICIARY-CIVIL -SJ 00462

05/26/77 SENATE PLACED ON SPECIAL ORDER CALENDAR -SJ 00526; PASSED AS

AMENDED; YEAS 32 NAYS O -SJ 00545 05/30/77 HOUSE AMENDMENTS TO SENATE AMENDMENTS ADOPTED; CONCURRED IN

SENATE AMENDMENTS AS AMENDfO; PASSED AS FURTHER

AMENDED; YEAS 99 NAYS O -HJ 00848 05/31/77 SENATE CONCURRED; PASSED AS FURTHER AMENDED; YEAS 38 NAYS

06/03/77 06/14/77

06/ 2417 7

-SJ 00628HOUSE OP.OEPED ENGROSSED, THEN ENROLLEDHOUSE SIGNED BY OFFICERS AND PRESENTED TO GOVERNOR

APPROVED BY GOVERNOR CHAPTER NO, 77-334

0

H 2128 GENERAL BILL BY HEALTH ANO REHABILITATIVE SERVICES ANO OTHERS (SIMILAR

rs/S 0176, COMPARES 0618, H 07041 CONTINUED ON NEXT PAGE

07/22/77 HOUSE BILL ACTIONS REPORT PAGE 504

H 2129

H 2130

H 2131

RETARDED PERSO..,S; ENACTS "RETARDATION PREVENTION & COMMUNITY SERVICES

ACT"; PRESCRIBES PROGRAMS OF SERVICE FOR RETARDED & OTHER

DEVfLOPMENTALLY DISABLED PERSONS; PROVIDES FOR OEV�LOPMFNT OF PROGRAMS

OF PREVENTION & COMMUNITY-BASED SERVICES, ETC, AMENDS CH, 393; REPEALS

402.13. EFFECTIVE �ATE: 07/01/77,

04/26/77 HOUSE INTRODUCED, REFERRED TO FINANCE AND TAXATION,

APPROPRIATIONS -HJ 00367 05/02/77 HOUSE WITHO�AWN FROM FINANCE ANC TAXATION -HJ 00399; NOW

REFERRED TO APPROPRIATIONS

06/03/77 HOUSE DIED IN COMMITTEE, IDEN,/SIM./CO�PARE BILL PASSED,

REFER TO S 176 (CH. 77-3351

GENERAL BILL BY VETERANS AFFAIRS ANO OTHERS (COMPARE CS/H 0143,

FNG/S 0041, S 04481 TRAFCIC CODE; AUTHORIZES BUSINESSES, FIRMS & CTHER PERSONS TO PROVIDE

PARKING SPACES FOR CERTAIN DISABLED PERSONS; REQUIRES SUCH SPACES TO BE POSTED WITH SIGN APPROVED BY o.o.T,; PROHIBITS PEQSONS OTHER THAN

DISABLED F�OM PARKING IN SUCH SPACES, ETC. AMENDS 316,1Q55; CREATES

316.1956. EFFECTIVE OAT�: 10/01/77.

04/26/77 HOUSE INTRODUCED, PLACED ON CALENDA� -HJ 00367

05/11/77 HOUSE READ SECOND TIME -HJ 00517

05/12/77 HOUSE READ THIRD TIME; PASSED; YEAS 109 NAYS O -HJ 00528

05/17/77 SENATF RECEIVED, REFERRED TO TRANSPORTATION -SJ 00402 05/24/77 S:NATE COMM. REPORT: FAVORABLE WITH AMEND., PLACED ON CALENDAR

BY TRANSPORTATION -SJ 00500 06/02/77 SENATE PLACED ON SPECIAL ORDER CALENDAR -SJ 00729; PASSED AS

AMENDED; YEAS 29 NAYS O -SJ 00788 06/02/77 HOUSE CONCURRED; PASSED AS AMENCED; YEAS 113 NAYS 0

-HJ 01135

06/24/77 HOUSE SIGNED BY O�FICERS ANO PRESENTED TO GOVERNOR

06/30/77 APPPOVFD BY GOVERNOR CHAPTER NO, 77-444

GENERAL BILL BY VETERANS AC FAIRS AND OTHERS

HUNTING & FISHING LICENSES; PROVIDES PERMANENT STATE LICENSE SHALL BE

ISSUED, UPON REQUEST, TO RESIDENT OF STATE WHO IS TOTALLY & PERMANENTLY

DISABLED , AMENDS 372.57. �FFECTIVE DATE: UPON BECOMING LAW,

04/26/77 HOUSE INTRODUCED, REFERRED TO APPROPRIATIONS -HJ 00367 04/27/77 HOUSE WITHDRAWN FROM APPROPRIATIONS; REFE�REO TO NATURAL

RFSOU�CES, APPROPRIATIONS -HJ 00371

05/11/77 HOUSE COMM. REPORT: FAVORABLE BY NATUQAL RESOURCES -HJ 00521; NOW REC FRREO TO APPROPRIATIONS

06/03/77 HOUSE DIED IN COMMITTEE ON APPROPRIATIONS

GENERAL BILL BY VETERANS AFCAIRS ANO OTHERS

SALTWAT=R C ISHERIES; EXEMPTS CERTAIN DISABLED VETERANS FRC� LICENSE FEE

CHARGED FOR CRAWFISHING. AMENDS 370.14, EFFECTIVE OATF: 07/01/77,

04/26/77 HOUSE INTRODUCED, REFERRED TO NATURAL RESOURCES, FINANCE ANO

TAXATION -HJ 00367 05/11/77 HOUSE COMM. REPQRT: FAVORABLE BY NATURAL RESOURCES -HJ 00522;

NQW REFrRRf.D TO FINANCE ANO TAXATION 06/03/77 HOUSE DIED IN COMMITTEE ON FINANCE ANO TAXATION

H 2132 GENERAL BILL BY HEALTH ANO REHABILITATIVE SERVICES AND OTHERS !SIMILAR

ENG/S 14251 CONTINUED ON NEXT PAGE

,,.. • , r�, n "o -H.I 00368

Journal

of the

SENATE

State of Florida

NINTH REGULAR SESSION

UNDER THE CONSTITUTION AS REVISED IN 1968

APRIL 5 THROUGH JUNE 3, 1977

�(Q)[p)V reproduced by

FLORIDA STATE ARCHIVES DEPARTMENT OF STATE

A.A. GRAV BUILDING Tallahassee. Florida 32399-0?50

326

INTRODUCTION

JOURNAL OF THE SENATE May 4, 1977

By Senators Poston, Gordon, Graham, Renick, Firestone, Myers, Holloway and Winn-

SCR 1460-A concurrent resolution commending Anna Bren­ner Meyers for her public service and her outstanding leader­ship in education in Dade County, Florida.

-was read the first time in full. On motion by Senator Poston by two-thirds vote SCR 1460 was read the second time oy title, adopted, and certified to the House. The vote on adop­tion was:

Yeas-35

Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Gordon

Nays-None

Gorman Graham Hair Henderson Holloway Johnston Lewis llfacKay McClain

Myers Peterson Poston Renick Sayler Scott Skinner Spicola Thomas, Jon

Thomas, Pat Tobiassen Trask Vogt Ware Williamson Wilson Winn

Senators Brantley, Barron, Castor, Chamberlin, Don Childers, W. D. Childers, Dunn, Gallen, Glisson, Gorman, Hair, Hender­son, Johnston, Lewis, MacKay, McClain, Peterson, Plante, Say­ler, Scarborough, Scott, Skinner, Spicola, Jon Thomas, Pat Thomas, Tobiassen, Trask, Vogt, Ware, Williamson and Wilson were recorded as co-introduc·ers of SCR 1460.

. •On motion by Senator Poston, the rules were waived and SCR 1460 was ordered _\mmediately certified to the House.

REQUESTS FOR EXTENSION OF TIME

The Committee on Commerce requests an extension of 15 days for the consideration of th� following:

SB 615 by Senator Gordon SB 623 by Senator Pat

Thomas SB 624 by Senator Scar­

borough

SB 628 by Senator Vogt SB 620 by Senator Lewis

The Committee on Education requests an extension of 15 days for the consideration of the following:

SB 600' by Senator Zinkil SB 601 by Senator Castor SB 602 by ·Senator Castor SB 747 by Senator MacKay SB 858 by Senator Graham SB '893 by Senator Lewis

SB 896 by Senator Plante SB 898 by Senator Plante HB 20 by Representative

Young SCR 622 by Senator Peterson

The Committee on Governmental Operations requests an ex­tension of 15 days for the consideration of the following:

SB 606 by Senator Hair SB 828 by Senator Jon

Thomas SB 856 by Senator Spicola,

et al

SB 897 by Senator Plante, et al

HB 133 by Representative Grizzle

The Committee on Health and Rehabilitative Services re­quests an extension of 15 days for the consideration of the following:

SB 874 by Senator Henderson HB 246 by RepresentativesSB 895· by Senator Myers J. Hyatt Brown

and John Lewis

The Committee on Personnel, Retirement and Collective Bargaining requests an extension of 15 days for the considera­tion of the following:

SB 680 by Senator Pat Thomas

SB 702" by Senator Peterson SB. 716 by Senator McClain SB 7·36 by Senator Dunn

SB 756 by Senator Skinner CS for HB 42 by The Com­

mittee on Com­munity Affairs

The Special Master for Claims requests an extension of 15 days _for the consideration of the following:

SB 432 by Senator Renick SB 477 by Senator Lewis SB 498 by Senator Jon

Thomas· SB 557 by Senator Graham SB 720 by Senator Gordon SB 759 by Senator Winn

and others SB 926 by Senator Peter­

son SB 1048 by Senator Zinkil SB 1264 by Senator Gordon

SB 1281 by Senator Pat Thomas

SB 1335 by Senator Pat Thomas

SB 1359 by Senator Pat Thomas

HB 6 by Representative Margolis

HB 24 by Representative Martin

HB 40 by Representative Rish and others

The Select Subcommittee of the Committee on Education appointed April 21 requests an extension of 5 days for con­sideration of SB 696, which was referred April 28.

MESSAGES FROM THE GOVERNOR AND OTHER EXECU­TIVE COMMUNICATIONS

The Governor advised that he had filed in the office of the Secretary of State SB 265 which he had approved May 2, 1977, and SB 5 which he had approved May 3, 1977.

MESSAGES FROM THE HOUSE OF REPRESENTATIVES

The Honorable Lew Brantley, President

I am directed to inform the Senate that the House of Repre­sentatives has concurred in •Senate Amendments and passed HB 112, as amended .

Allen Morris, Cl.erk

SPECIAL ORDER

CS for SB 960-A bill to entitled An act relating to organized crime; making it unlawful to use or invest proceeds from a pattern of racketeering conduct or from the collection of an unlawful debt to acquire or maintain an interest in, or to estab­lish or conduct an enterprise, including real property; provid­ing an affirmative defense; making it unlawful to acquire or maintain an interest iri, or to conduct an enterprise, including real property, through a pattern of racketeering conduct or through the co!Jection of an unlawful debt; making it unlaw­ful to conspire or endeavor to engage in such conduct, or to solicit, coerce, or intimidate another to do so; providing crimi­nal penalties; providing procedures and criteria for adjudicating certain persons to be dangerous special racketeers; providing a criminal penalty for a dangerous special racketeer; providing an alternative fine; providing for the rights of innocent persons; providing civil remedies of divestiture, reasonable restrictions on future activities, dissolution or reorganization of any enter­prise, revocation or suspension of licenses or permits, and for­feiture of corporation charter or revocation of certificate au­thorizing a foreign corporation to conduct business within this state; providing for seizure and state disposal of seized· and forfeiture property; providing that any aggrieved person may institute civil proceedings to seek treble damages, attorney's fees, and punitive damages; providing for civil investigative demand for any agency having jurisdiction to investigate as a crime or as a violation of state regulatory laws or rules; providing procedures for using civil investigative demand; pro­viding for the confidentiality of documentary material produced under a civil investigative demand and for the return or dis­posal of such material after the conclusion of such investiga­tion; amending s. 905.34, Florida Statutes; extending the sub­ject matter jurisdiction of the state wide g-rand jury to in­clude violations of this act; amending s. 934.07, Florida Stat­utes; allowing authorization for the interception of wire or oral communications to provide evidence of any violation of the provisions of this act and certain other offenses; providing severability; providing an effective date.

-was read ihe third time by title.

Senator Dunn moved the following amendments which were adopted by two-thirds vote:

Amendment 1-On page 6, line 15, strike "racketeering con­duct" and insert: racketeering activity

May 4, 1977 JOURNAL OF THE SENATE 327

Amendment 2-On page 8, line 17, insert after "persuasion": by a preponderance of the evidence

Amendment 3-On page 11, lines 1-3, strike "and that a sen­tence as a dangerous special racketeer is warranted for the protection of the public from further criminal conduct by the defendant"

Amendment 4-On page 12, line 6, insert after "conduct.": A special racketeer is not dangerous when an extended term of imprisonment is not necessary for the protection of the public from further criminal conduct by the defendant.

Senator Scarborough presiding

Senator Williamson moved that CS for SB 960 as amended be recommitted to the Committee on Judiciary-Criminal.

Senator Wilson moved as a substitute motion that CS for SB 960 as amended be referred to the Committee on Judiciary­Civil.

Senator W. D. Childers moved an amendment to the substitute motion that CS for SB 960 as amended be also referred to the Committee on Commerce. The motion failed by the following vote:

Yeas-16

Barron Hair Poston Tobiassen Childers, W. D. Henderson Scarborough Trask Gallen McClain Skinner Ware Gordon Peterson Thomas,Pat Wilson

Nays-20

Castor Glisson Lewis Thomas,Jon Chamberlin Gorman Myers Vogt Childers, Don Graham Renick Williamson Dunn Holloway Scott Winn Firestone Johnston Spicola Zinkil

The question recurred on the substitute motion which failed to receive the required two-thirds vote. The vote was:

Yeas-23

Barron Lewis Renick Thomas, Pat Childers, Don McClain Scarborough Tobiassen Childers, W. D. Myers Scott Trask Gallen Peterson Skinner Ware Gordon Plante Spicola Wilson Henderson Poston Thomas, Jon

Nays-14

Castor Glisson Holloway Williamson Chamberlin Gorman Johnston Zinkil Dunn Graham MacKay Firestone Hair Vogt

The motion by Senator Williamson was adopted by the fol­lowing vote:

Yeas-37

Barron Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Glisson Gordon

Nays-I

Zinkil

Gorman Graham Hair Henderson Holloway Johnston Lewis MacKay McClain Myers

Peterson Plante Poston Renick Scarborough Scott Skinner Spicola Thomas, Jon Thomas, Pat

Tobiassen Trask Vogt Ware Williamson Wilson Winn

SB 604-A bill to be entitled An act relating to the Florida 'Comprehensive Drug Abuse Prevention and Control Act; amending s. 893.13(1) (f), Florida Statutes; providing a pen­alty for possession or delivery of not more than 1 avoirdupois ounce of cannabis; amending s. 893.14(1), Florida Statutes, and adding subsection (3) to said section; providing for de­struction of arrest or conviction records after a specified pe­riod; amending s. 893.15, Florida Statutes; eliminating con­flicts; providing severability; providing an effective date.

-was read the second time by title.

The Committee on Judiciary-Criminal offered the following amendment which was moved by Senator Myers:

Amendment 1-On page 1, strike all lines 17-31 and on page 2 strike all of lines 1-21 and insert: Section 1. Paragraph (f) of subsection (1) of section 893.13, Florida Statutes, is amended to read:

893.13 Prohibited acts; penalties.­

(!)

(f) If the Hffit offense is the possession or delivery withoutconsideration of not more than J avoirdupois ounce or 28.35

grams e � of cannabis, that person shall be guilty of a misdemeanor of the first degree, punishable as �ea ift tn � tHHi s-, �&& by a fine not to exceed $500 but in no event less than $100. The fine fixed by the court shall not be waived or suspended. For purposes of this subsection, "can­nabis" shall not include the resin extracted from the plant Cannabis sativa, L., or any compound manufacture, salt, deriva­tive, mixture, or preparation of such resin.

Point of Order

Senator Don Childers raised a point of order that SB 604, if passed, would affect appropriations and should therefore be referred to the Committee on Appropriations. Speaking to the point, Senator Myers stated that pending amendments would change the bill to the extent that it would not substantially affect appropriations. The Chair ruled the point not well taken.

Amendment 1 was adopted.

The Committee on Judiciary-Criminal offered the following amendments which were moved by Senator Myers and adopted:

Amendment 2-On page 3, line 4, after "prescribe" and on page 4, line 30, after "offense" insert: except that the fine imposed by s. 893.13(1) (f) shall not be waived or suspended

Amendment 3-On page 3, strike lines 18-31 and on page 4 lines 1-16.

Senator Myers moved the following amendment which was adopted:

Amendment 4-On page 2, lines 23 and 24, strike "and sub­section ( 3) is added to said section"

The Committee on Judiciary-Criminal offered the following title amendments which were moved by Senator Myers and adopted:

Amendment 5-On page 1, line 7, strike ", and adding" and strike all of lines 8-13 and insert: ; amending s. 893.15, Florida Statutes; providing severability; providing an effective date.

Amendment 6-On page 1, line 7, strike ", and adding" and strike all of lines 8-13 and insert: ; conforming provisions; amending s. 893.15, Florida Statutes; excluding persons con­victed under s. 893.13 (1) (f), Florida Statutes, from the pro­vision allowing judge to require a rehabilitation program; pro­viding severability; providing an effective date.

Senator Glisson moved the following amendment:

Amendment 7-On page 1 of Amendment 1, line 5, strike "fffi;t" and insert: first

Amendment 7 failed by the following vote:

542 JOURNAL OF THE SENATE May 26, 1977

HB 728-A bill to be entitled An act for the relief of Anna Mae Martin; providing an appropriation to compensate her for the death of her husband, Carroll L. Martin, due to the negligence of the Department of Transportation; providing an effective date.

-was read the second time by title. On motion by Senator Pat Thomas, by two-thirds vote HB 728 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-30

Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Nays-None

Glisson Gorman Graham Henderson Holloway Johnston Lewis MacKay

Votes after roll call: Yeas-Peterson, Williamson

McClain Myers Poston Renick Scarborough Skinner Spicola Thomas,Jon

Thomas, Pat Tobiassen Trask Vogt Wilson Winn

On motions by Senator Pat Thomas, the rules were waived and by two-thirds vote HB 735 was withdrawn from the Com­mittee on Finance, Taxation and Claims and placed on the cal­endar.

HB 735-A bill to be entitled An act relating to the South­west Florida Water Management District; providing for the relief of Anna Mae Martin; authorizing and directing the Southwest Florida Water Management District to compensate her for the death of her husband, Carroll L. Martin due to the negligence of the district; providing an effective date.

-was read the second time by title. On motion by SenatorPat Thomas, by two-thirds vote HB 735 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-30 Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Nays-None

Glisson Gorman Graham Henderson Holloway Johnston Lewis MacKay

Votes after roll call:

Yeas-Peterson, Williamson

McClain Myers Poston Renick Scarborough Skinner Spicola Thomas, Jon

Thomas, Pat Tobiassen Trask Vogt Wilson Winn

On motion by Senator Tobiassen, by two-thirds vote HB 1716 was withdrawn from the Committee on Finance, Taxation and Claims and placed on the calendar.

RB 1716--A bill to be entitled An act relating to Escambia County; providing for the relief of Lillie Adams Miller for the death of her husband, Len Burton Adams, while acting in the performance of his duties as a deputy sheriff of Escambia County; authorizing and empowering the Board of County Commissioners of Escambia County to pay to Lillie Adams Miller the sum of $20,000 out of the general fund of said county; providing an effective date.

-was read the second time by title. On motion by Senator Tobiassen, by two-thirds vote HB 1716 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-28 Mr. PresidentCastor Chamberlin

Childers, Don Firestone Childers, W. D. Gallen Dunn Glisson

Gorman Graham Henderson

Holloway Johnston Lewis MacKay Nays-None

McClain Myers Renick Scarborough

Votes after roll call:

Skinner Thomas, Jon Thomas, Pat Tobiassen

Yeas-Peterson, Spicola, Wi!liamson

Trask Vogt Wilson Winn

On motion by Senator Pat Thomas, by two-thirds vote HB 1789 was withdrawn from the Committee on Finance, Taxation and Claims and placed on the calendar.

HB 1789-A bill to be entitled An act relating to Wakulla County; authorizing and directing the county to compensate Jessie Porter for injuries sustained as a result of purchasing property from the state at a tax sale; providing an effective date.

-was read the second time by title. On motion by Senator Pat Thomas, by two-thirds vote HB 1789 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-30 Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Nays-None

Glisson Gorman Graham Henderson Johnston Lewis MacKay McClain

Votes after roll call: Yeas--Peterson, Williamson

Myers Poston Renick Scarborough Skinner Spicola Thomas, Jon Thomas, Pat

Tobiassen Trask Vogt Wilson Winn Zinkil

On motion by Senator Pat Thomas, by two-thirds vote HB 646 was withdrawn from the Committee on Finance, Taxation and Claims and placed on the calendar.

HB 646--A bill to be entitled An act for the relief of Jessie Porter; providing a $1,000 appropriation to compensate him for injuries sustained as a result of purchasing property from the state at a tax sale; providing an effective date.

-was read the second time by title. On motion by Senator Pat Thomas, by two-thirds vote HB 646 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-28

Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone

Nays-2

Johnston

Gallen Glisson Gorman Graham Henderson Lewis MacKay

Wilson Votes after roll call:

Yeas-Peterson, Williamson

SPECIAL ORDER

McClain Myers Poston Renick Scarborough Skinner Spicola

Thomas, Jon Thomas, Pat Tobiassen Trask Vogt Winn Zinkil

HB 2127-A bill to be entitled An act relating to organi�ed crime; making it unlawful to use or invest ai:iy mon�Y: or _thmg of value derived from a pattern of racketeermg acti_vity_ m th

1 acquisition of any title to, right, interest, or eqmty m rea property or enterprise in this state; making it unlawful to i:c­quire or maintain an interest in real property or an enterprise through a pattern of racketeering activity or the collec�1�n of an unlawful debt; making it unlawful to conduct or part1c1pate

May 26, 1977 JOURNAL OF THE SENATE 543

in any enterprise through a pattern of racketeering activity or through the collection of an unlawful debt; making it unlaw­ful to conspire or attempt to commit such prohibited activities; providing penalties; providing for the forfeiture of any interest in, security issued by, claim against, or property or contractual right affording influence or control over any such enterprise or real property; providing for injunction, seizure, and state dis­posal of seized and forfeited property; providing for the rights of innocent parties; providing civil remedies of divestiture, reasonable restrictions on future activities, dissolution or re­organization of any enterprise, revocation or suspension of licenses or permits, and forfeiture of corporation charter or revocation of certificate authorizing a foreign corporation to conduct business within this state; providing for civil cause of action for any person injured as a result of another's violation of the prohibited conduct; providing for civil investigative demand for any agency having jurisdiction to investigate as a crime or as a violation of state regula­tory laws or rules; providing procedures for using civil investi­gative demand and identifying who may use same; providing for the confidentiality of documentary material produced under a civil investigative demand and for the return or disposal of such material after the conclusion of such investigation; providing severability; amending section 905.34, Florida Statutes, to ex­tend the subject matter jurisdiction of the statewide grand jury to include violations of this act; providing an effective date.

-was read the second time by title.

On motions by Senator Dunn, the rules were waived and the amendments recommended by the Committee on Judiciary­Criminal were withdrawn.

The Committee on Judiciary�Civil offered the following amendment which was moved by Senator Dunn:

Amendment 1-0n page 3, strike everything after the en­acting clause and insert: 1. Section 21'0.18, Florida Statutes, re­lating to evasion of payment of cigarette taxes.

2. Section 409.325, Florida Statutes, relating to public as­sistance fraud.

3. Chapter 617, Florida Statutes, relating to sale of se­curities.

(1) "Racketeering activity" means to commit, to attemptto commit, to conspire to commit, or to solicit, coerce, or in­timidate another person to commit:

(a) Any crime which is chargeable by indictment or in­formation under the following provisions of the Florida Stat­utes:

Section 1. Short title.-Sections 1 through 7 of this act shall be known as the Florida RICO (Racketeer Influenced and Corrupt Organization) Act.

Section 2. Definitions.-As used in this act:

4. Sections 660.24, 660.35, 5"60.36, Florida Statutes, relatingto dog racing and horse racing.

5. Section 5'51.09, Florida Statutes, relating to jai alai fron­tons.

6. Chapter 552, Florida Statutes, relating to manufacture,distribution, and use of explosives.

7. Chapter 562, Florida Statutes, relating to beverage Jawenforcement.

8. Chapter 687, Florida Statutes, relating to interest andusurious practices.

9. Chapter 782, Florida Statutes, relating to homicide.

10. Chapter 784, Florida Statutes, relating to assault andbattery.

11. Chapter 787, Florida .Statutes, relating to kidnapping.

12. Chapter 790, Florida Statutes, relating to weapons andfirearms.

13. Sections 796.01, 796.03, 796.04, 796.05, 796.07, FloridaStatutes, relating to prostitution.

14. Chapter 806, Florida Statutes, relating to arson.

15. Chapter 812, Florida Statutes, relating to larceny, rob­bery, and related crimes.

16. Chapter 817, Florida Statutes, relating to fraudulentpractices, false pretenses, fraud generally, and credit card crimes.

17. Chapter 831, Florida Statutes, relating to forgery andcounterfeiting.

18. Chapter 832, Florida Statutes, relating to issuance ofworthless checks and drafts.

19. Chapter 837, Florida Statutes, relating to perjury.

20. Chapter 838, Florida Statutes, relating to bribery andm'suse of public office.

21. Chapter 843, Florida Statutes, relating to obstructionof justice.

22. Sections 847.011, 847.012, 847.013', 847.06, 847.07, FloridaStatutes, relating to obscene literature and profanity.

23. Sections 849.09, 849.14, 849.15, 849.23, 849.24, 849.25,Florida Statutes, relating to gambling.

24. Chapter 893, Florida Statutes, relating to drug abuseprevention and control.

25. Sections 918.12-918.14, Florida Statutes, relating to tamp­ering with jurors, evidence, and witnesses.

(b) Any conduct defined as "racketeering activity" underTitle 18, United States Code, Section 1961 (1) (B), (C), and (D).

(2) "Unlawful debt" means any money or other thing ofvalue constituting principal or interest of a debt that is legally unenforceable in the State of Florida in whole or in part because the debt was incurred or contracted:

(a) In violation of any one of the following provisions oflaw:

1. Sections 550.24, 550.35, 550.36, Florida Statutes, relatingto dog racing and horse racing.

2. Section 551.09, Florida Statutes, relating to jai alaifrontons.

3. Chapter 687, Florida Statutes, relating to interest andusury.

4. Sections 849.09, 849.14·, 849.15, 849.23, 849.24, 849.25,Florida Statutes, relating to gambling.

(b) In gambling activity in violation of federal law or inthe business of lending money at a rate usurious under state or federal law.

(3) "Enterprise" means any individual, sole proprietorship,partnership, corporation, business trust, union chartered under the laws of this state, or other legal entity, or any unchartered union, association, or group of individuals associated in fact although not a legal entity, and it includes illicit as well as licit enterprises and governmental as well as other entities.

( 4) "Pattern of racketeering conduct" means engaging inat least two incidents of racketeering conduct that have the same or similar intents, results, accomplices, victims, or methods of commission, or otherwise are interrelated by distinguishing characteristics and are not isolated incidents, provided at leastone of such incidents occurred after the effective date of this act and that the last of such incidents occurred within 5 years after a prior incident of racketeering conduct.

(5) "Documentary material" means any book, paper, docu­ment, writing, drawing, graph, chart, photograph, phonorecord, magnetic tape, computer print-out, any other data compilation from which information can be obtained or from which infor­mation can be translated into useable form, or any other tan­gible item.

Section 3. Prohibited activities and defense.-

( 1) (a) It is unlawful for any person who has with crim­inal intent received any proceeds derived, directly or indirectly, from a pattern of racketeering activity or through the col­lection of an unlawful debt to use or invest, whether directly or indirectly, any part of such proceeds; or the proceeds de­rived from the investment or use thereof, in the acquisition of

544 JOURNAL OF THE SENATE May 26, 1977

any title to, or any right, interest, or equity in real property, or the establishment or operation of any enterprise.

(b) It is an affirmative defense if the proceeds were usedto purchase securities of such enterprise on the open market without a purpose to control or participate in the control of such enterprise, or to assist another person to do so, if the se­curities of the purchaser, the members of his immediate family, and his or their accomplices in any pattern of racketeering conduct after such purchase do not confer, either in law or in fact, the power to elect one or more directors of such enter­prise. The person asserting such defense bears the burden of proof.

(2) It is unlawful for any person, through a pattern ofracketeering activity or through the collection of an unlawful debt, to acquire or maintain, directly or indirectly, any interest in or control of any enterprise or real property.

(3) It is unlawful for any person employed by, or associatedwith, any enterprise to conduct or participate, directly or indi­rectly, in such enterprise through a pattern of racketeering ac­tivity or the collection of an unlawful debt.

(4) It is unlawful for any person to conspire or endeavorto violate any of the provisions of subsections (1), (2), or (3).

Section 4. Criminal penalties and alternative fine.-(1) Any person convicted of engaging in activity in viola­

tion of the provisions of section 3 is guilty of a felony of the first degree, and shall be punished as provided in s. 775.082, s. 775.083, or s. 775.084, Florida Statutes.

(2) In lieu of a fine otherwise authorized by law, any per­son convicted of engaging in conduct in violation of the pro­visions of section 3 through which he derived pecuniary value, or by which he caused personal injury or property damage or other loss, may be sentenced to pay a fine that does not exceed three times the gross value gained or three times the gross loss caused whichever is the greater, plus court costs and the costs of inv�stigation and prosecution, reasonably incurred.

(3) The court shall hold a hearing to determine the amount of the fine authorized by subsection (2).

( 4) For the purposes of subsection (2), "pecuniary value"means:

(a) Anything of value in the form of money, a negotiableinstrument, a commercial interest, or anything else the pri­mary significance of which is economic advantage; or

(b) Any other property or service that has a value in excessof $100.

S-ection 5. Civil remedies.-(1) Any circuit court may, after making due provisions for

the rights of innocent persons, enjoin violations of the pro­visions of section 3 by issuing appropriate orders and judg­ments including, but not limited to:

(a) Ordering any defendant to divest himself of" any in­terest in any enterprise, including real property;

(b) Imposing reasonable restrictions upon the future activi­ties or investments of any defendant, including but not limited to, prohibiting any defendant from engaging in the same type of endeavor as the enterprise in which he was engaged in violation of the provisions of section 3;

(c) Ordering the dissolution or reorganization of any enter­prise;

(d) Ordering the suspension or revocation of license, per­mit, or prior approval granted to any enterprise by any agency of the state;

(e) Ordering the forfeiture of the charter of a corporation organized under the laws of the State of Florida or the revo­cation of a certificate authorizing a foreign corporation to con­duct business within the State of Florida upon finding that the board of directors or a managerial agent acting on behalf of the corporation, in conducting the affairs of the corpora­t!on, has authorized or engaged in conduct in violation of sec­tion 3 and that for the prevention of future criminal activity, th� public interest requires the charter of the corporation for­feited and the corporation dissolved or the certificate revoked.

(2) All property, real or personal, including money, used inthe course of, intended for use in the course of, derived from, or realized through conduct in violation of a provision of this act is subject to civil forfeiture to the State of Florida. The State of Florida shall dispose of all forfeited property as soon as commercially feasible. If property is not exercisable or transferable for value by the State of Florida, it shall expire. All forfeitures or dispositions under this section shall be made with due provision for the rights of innocent persons. The proceeds realized from such forfeiture and disposition shall be promptly deposited in the treasury of the .State of Florida and immediately credited to the general revenue fund of the state.

(3) Property subject to forfeiture under this section may be seized by a law enforcement officer upon court process. Seizure without process may he made if:

(a) The seizure is incident to a lawful arrest or search or an inspection under an administrative inspection warrant; or

(b) The property subject to seizure has been the subject of a prior judgment in favor of the State of Florida in a for­feiture proceeding based upon this section.

( 4) In the event of a seizure under subsection ( 3), a for­feiture proceeding shall be instituted promptly. Property taken or detained under this section shall not be subject to replevin, but is deemed to be in the custody of the law enforcement of­ficer making the seizure subject only to the order of the court. When property is seized under this section pending for­feiture and final disposition, the law enforcement officer may:

(a) Place the property under seal;

(b) Remove the property to a place designated by court; or (c) Require another agency authorized by law to take

custody of the property and remove it to an appropriate location. (5') The State Attorney General, any State Attorney or

any state agency having jurisdiction over conduct in violation of a provision of this act may institute civil proceedings under this section. In any action brought under this section, the circuit court shall proceed as soon as practicable to the hearing and determination. Pending final determination, the circuit court may at any time enter such injunctions, prohibitions, or restraining orders, or take such actions, including the accept­ance of satisfactory performance bonds, as the court may deem proper.

(6) Any aggrieved person may institute a proceeding undersubsection ( 1). In such proceeding, relief shall be granted in conformity with the principles that govern the granting of injunctive relief from threatened loss or damage in other civil cases, provided that no showing of special or irreparable damage to the person shall have to be made. Upon the execution of proper bond against damages for an injunction improvidently granted and a showing of immediate danger of significant loss or damage, a temporary restraining order and a preliminary injunction may be issued in any such action before a final determination on the merits.

(7) Any person who is injured by reason of any violation of the provisions of section 3 shall have a cause of action for three-fold the actual damages sustained and, where appropriate, punitive damages,. Such person shall also recover attorneys' fees in the trial and appellate courts, and costs of investigation and litigation, reasonably incurred.

(a) The defendant or any injured person may demand atrial by jury in any civil action brought pursuant to this section.

(b) Any injured person shall have a right or claim toforfeited property or to the proceeds derived therefrom superior to any right or claim the state has in the same property or proceeds.

(8) A final judgment or decree rendered in favor of the State of Florida in any criminal proceeding under this act shall estop the defendant in any subsequent civil action or proceeding as to all matters which such judgment or decree would be an estoppel as between the parties.

(9) 'T'he Attorney General may, upon timely application, intervene in any civil action or proceeding brought under subsections (6) or (7) if he certifies that in his opinion the action or proceeding is of general public importance. In ?uch action or proceeding, the State of Florida shall be entitled to the same relief as if the Attorney General had instituted

May 26, 1977 JOURNAL OF THE SENATE 545

this action or proceeding.

(10) Notwithstanding any other provision of law, a criminal or civil action or proceeding under this act may be commenced up until 5 years after the conduct in violation of a provision of this act terminates or the cause of action accrues. If a criminal prosecution, civil action or other proceeding is brought, or intervened in, to punish, prevent, or restrain any violation of the provisions of this act, the running of the period of limi­tations prescribed by this section with respect to any cause of action arising under subsections (6) or (7) which is based in whole or in part upon any matter complained of in any such prosecution, action or proceeding shall be suspended during the pendency of such prosecution, action or proceeding and for two years following its termination.

(11) The application of one civil remedy under any provi­sion of this act shall not preclude the application of any other remedy, civil or criminal, under this act or any other pro­vision of Jaw. Civil remedies under this act are supplemental and not mutually exclusive.

Section 6. Section 905.34, Florida Statutes, is amended to read:

905.34 Powers and duties; Jaw applicable.-The jurisdiction of a statewide grand jury impaneled under this chapter shall extend throughout the state. The subject matter jurisdiction of the statewide grand jury shall be limited to the offenses of bribery, burglary, criminal fraud, criminal usury, extortion, gambling, kidnapping, larceny, murder, prostitution, perjury, robbery, any violation of the provisions of the Florida RICO(Racketeer Influenced and Corrupt Organization) Act, and crimes involving narcotic or other dangerous drugs, or any attempt, solicitation, or conspiracy to commit any violation of the crimes specifically enumerated above, when any such of­fense is occurring, or has occurred, in two or more counties as part of a related transaction, or when any such offense is con­nected with an organized criminal conspiracy affecting two or more counties. The statewide grand jury may return indict­ments and presentments irrespective of the county or judicial circuit where the offense is committed or triable. If an indict­ment is returned, it shall be certified and transferred for trial to the county where the offense was committed. The powers and duties of, and law applicable to, county grand juries shall apply to a statewide grand jury except when such powers, duties, and law are inconsistent with the provisions of ss. 905.31-905.40.

Section 7. If any provision of this act or the application of it to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the act that can be given effect without the invalid provision or application, and to this end the provisions of this act are declared severable.

Section 8. This act shall take effect October 1, 1977.

Senator Dunn moved the following amendment to Amendment 1 which was adopted:

Amendment lA-On page 3, line 16, after "1961(1)" insert: (A)

Amendment 1 as amended was adopted.

The Committee on Judiciary-Civil offered the following title amendment which was moved by Senator Dunn and adopted:

Amendment 2-On pages 1-2, strike all of pages 1 and 2 and insert: A bill to be entitled An act relating to organized crime; making it unlawful to use or invest proceeds from a pattern of racketeering conduct or from the collection of an unlawful debt to acquire or maintain an interest in, or to establish or con­duct an enterprise, including real property; providing an af­firmative defense; making it unlawful to acquire or maintain an interest in, or to conduct an enterprise or acquire real property, through a pattern of racketeering conduct or through the collection of an unlawful debt; making it unlawful to con­spire or endeavor to engage in such conduct; providing criminal penalties; providing an alternative fine; providing for the rights of innocent persons; providing civil remedies of divesti­ture, reasonable restrictions on future activities, dissolution or r_eorganization of any enterprise, revocation or suspens-ion of licenses or permits, and forfeiture of corporation charter or re­vocation of certificate authorizing a foreign corporation to con­d�ct business within this state; providing for seizure and state disposal of seized and forfeited property; providing that any

aggrieved person may institute civil proceedings to seek treble damages, attorney's fees, and punitive damages; providing for right to jury trial; providing for priority of claim; amending s. 905.34 Florida Statutes; extending the subject matter juris­diction of the state wide grand jury to include violations of this act; providing severability; providing an effective date.

On motion by Senator Dunn, by two-thirds vote HB 2127 as amended was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-32

Mr. President Castor Chamberlin Childers, Don Childers, W. D. Dunn Firestone Gallen Nays-None

Glisson Gorman Graham Holloway Johnston Lewis MacKay McClain

Votes after roll call:

Myers Plante Poston Renick Scarborough Scott Skinner Spicola

Thomas, Jon Thomas, Pat Tobiassen Trask Vogt Wilson Winn Zinkil

Yeas-Henderson, Peterson, Sayler, Ware, Williamson

SB 521-A bill to be entitled An act relating to firearms; amending s. 790.15, Florida Statutes; prohibiting the discharge of a firearm in any public place or on the right-of-way of any paved public road, highway, or street, or knowingly dis­charging any firearm over any such right-of-way or over any occupied premise; providing a penalty; providing an effective date.

-was read the second time by title.

The Committee on Judiciary-Criminal offered the following amendment which was moved by Senator Trask and failed:

Amendment 1-On page 1, lines 17 and 19, strike "paved"

On motion by Senator Trask, by two-thirds vote SB 521 was read the third time by title, passed and certified to the House. The vote on passage was:

Yeas-29

Castor Gorman Plante Vogt Chamberlin Graham Poston Williamson Childers, Don Holloway Sayler Wilson Childers, W. D. Johnston Scarborough Winn Dunn Lewis Skinner Zinkil Firestone MacKay Thomas, Jon Gallen McClain Tobiassen Glisson Myers Trask

Nays-5 Henderson Spicola Thomas, Pat Ware Scott Vote after roll call:

Yea-Peterson

On motion by Senator Firestone the rules were waived and the Senate reverted to-

MOTIONS RELATING TO COMMITTEE REFERENCE

On motions by Senator Firestone, by two-thirds vote CS for HB 1250 was withdrawn from the -Committee on Commerce and by two-thirds vote placed on the Special Order Calendar.

SPECIAL ORDER, continued CS for HB 1250-A bill to be entitled An act relating to the

Florida Banking Code; creating s. 659.67, Florida Statutes, allowing international banking corporations and international bank agencies, as defined in this act, to carry on an interna-

UNITED STATES CODE

1982 EDITION

CONTAINING THE GENERAL AND PERMANENT LAWS

OF THE UNITED STATES, IN FORCE

ON JANUARY 14, 1983

Prepared and published under authority of Title 2, U.S. Code; Section 285b

by the Office of the Law ReYision Counsel of the House of RepresentatiYes

VOLUME SEVEN

TITLE 17-COPYRIGHTS

TO

TITLE 19-CUSTOMS DUTIES

llNITED STATES

GOVERNMENT PRINTING OFFICE

WASHINGTON : rns:i

;'I,:.,.,;,; return t0

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§ 1961 TITLE 18-CRIMES AND CRIMINAL PROCEDURE Page 360

nue in excess of $2,000 in any single day shall be deemed to have been established.

(d) Any property, including moneyL

used in violation of the provisions of this section may be seized and forfeited to the United States. All provisions of law relating to the seizures,· sum­mary, and judicial forfeiture procedures, and condemnation of vessels, vehicles, merchandise, and baggage for violation of the customs laws; the disposition of such vessels, vehicles, mer­chandise, and baggage or the proceeds from such sale; the remission or mitigation of such forfeitures; and the compromise of claims and the award of compensation to informers in re­spect of such forfeitures shall apply to seizures and forfeitures incurred or alleged to have been incurred under the provisions of this section, insofar as applicable and not inconsistent with such provisions. Such duties as are imposed upon the collector of customs or any other person in respect to the seizure and forfeiture of vessels, vehicles, merchandise, and baggage under the customs laws shall be performed with respect to seizures and forfeitures of prop­erty used or intended for use in violation of this section by such officers, agents, or other per­sons as may be designated for that purpose by the Attorney General.

(e) This section shall not apply to any bingogame, lottery, or similar game of chance con­ducted by an organization exempt from tax under paragraph (3) of subsection (c) of section 501 of the Internal Revenue Code of 1954, as amended, if no part of the gross receipts de­rived from such activity inures to the benefits of any private shareholder, member, or employ­ee of such organization except as compensation for actual expenses incurred by him in the con­duct of such activity.

<Added Pub. L. 91-452, title VIII, § 803(a), Oct. 15, 1970, 84 Stat. 937.)

REFERENCES IN TEXT

The customs laws, referred to in subsec. Cd), are clas­sified generally to Title 19, Customs Duties.

Paragraph (3) of subsection Cc) of section 501 of the Internal Revenue Code of 1954, referred to in subsec. Ce), is classified to section 50HcH3l of Title 26, Inter­nal Revenue Code.

TRANSFER OF F'uNCTIONS

All offices of collector of customs, comptroller of customs. surveyor of customs, and appraiser of mer­chandise in the Bureau of Customs of the Department of the Treasury to which appointments were required to be made by the President with the advice and con­sent of the Senate were ordered abolished, with such offices to be terminated not later than Dec. 31, 1966, by Reorg. Plan No. 1 of 1965, eff. May 25, 1965, 30 F.R. 7035, 79 Stat. 1317, set out in the Appendix to Title 5, Government Organization and Employees. All func­tions of the offices eliminated were already vested in the Secretary of the Treasury by Reorg. Plan No. 26 of 1950, eff. July 31, 1950, 15 F.R. 4935, 64 Stat. 1280, set out in the Appendix to Title 5.

PRIORITY OF STATE LAWS

Enactment of this section as not indicating an intent on the part of the Congress to occupy the field in which this section operates to the exclusion of State of local law on the same subject matter, or to relieve any person of any obligation imposed by any State or local law, see section 811 of Pub. L. 91-452, set out as a

Priority of State Laws note under section 1511 of this title.

COMMISSION ON THE REVIEW OF THE NATIONAL POLICY

TOWARD GAMBLING

Sections 804 to 809 of Pub. L. 91-452 established the Commission on the Review of the National Policy Toward Gambling, provided for its membership and compensation of the members and the staff, empow­ered the Commission to subpoena witnesses and grant immunity, required the Commission to make a study of gambling in the United States and existing federal, state, and local policy and practices with respect to prohibition and taxation of gambling activities and to make a final report of its findings and recommenda­tions to the President and to Congress within four years of its establishment, and provided for its termi­nation sixty days after submission of the final report.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1961, 2516 of this title.

CHAPTER 96-RACKETEER INFLUENCED AND

CORRUPT ORGANIZATIONS

Sec.

1961. Definitions. 1962. Prohibited racketeering activities.' 1963. Criminal penalties. 1964. Civil remedies. 1965. Venue and process. 1966. Expedition of actions. 1967. Evidence. 1968. Civil investigative demand.

AMENDMENTS

1970-Pub. L. 91-452, title IX, § 901Ca), Oct. 15, 1970, 84 Stat. 941, added chapter 96 and items 1961 to 1968.

CHAPTER REFERRED TO IN OTHER SECTIONS

This chapter is referred to in title 7 section 12a.

§ 1961. Definitions

As used in this chapter-< 1) "racketeering activity" means <A> any

act or threat involving murder, kidnaping, gambling, arson, robbery, bribery, extortion, or dealing in narcotic or other dangerous drugs, which is chargeable under State law and punishable by imprisonment for more than one year; <B> any act which is indictable under any of the following provisions of title 18, United States Code: Section 201 <relating to bribery), section 224 <relating to sports bribery), sections 471, 472, and 473 <relating to counterfeiting), section 659 <relating to theft from interstate shipment) if the act in­dictable under section 659 is felonious, section 664 (relating to embezzlement from pension and welfare funds), sections 891-894 <relating to extortionate credit transactions), section 1084 <relating to the transmission of gambling information), section 1341 <relating to mail fraud), section 1343 (relating to wire fraud), section 1503 <relating to obstruction of jus­tice), section 1510 <relating to obstruction of criminal investigations), section 1511 <relating to the obstruction of State or local law en­forcement), section 1951 <relating to interfer­ence with commerce, robbery, or extortion),

'So in original. Does not conform lo section calchline.

Page 361

section 1952 < 1953 <relatini wagering par ing to unlawl tion 1955 <re. legal gamblin 2315 <relatinF stolen proper to traffickin� tions 2421-24 <C> any act wUnited State!:restrictions oorganization!:·embezzlementoffense involvunder title 11or the felontreceiving, co1otherwise dea.ous drugs, PUUnited States:

(2) "State"States, the D monwealth of possession of · subdivision, or strumentality

(3) "person·entity capablP­interest in pro

(4) "enterp1partnership, Cl

legal entity, a.: victuals associ:i. entity;

(5) "patternquires at least ty, one of whi. date of this ch curred within 1 of imprisonme prior act of rac

(6) "unlawfucurred or cor which was in United States. thereof, or w State or Feder: principal or int ing to usury, a connection wit violation of th State or politic business of len< at a rate usurio where the usm enforceable rat,

(7) "racketeeattorney or inv Attorney Genei of enforcing or ter;

(8) "z:acketee1inquiry conduct tigator for the f er any person h tion of this ch judgment, or , United States. proceeding arisi:

Page 361 TITLE 18-CRIMES AND CRIMINAL PROCEDURE § 1961

section 1952 (relating to racketeering), section 1953 (relating to interstate transportation of wagering paraphernalia), section 1954 <relat­ing to unlawful welfare fund payments), sec­tion 1955 (relating to the prohibition of il­legal gambling businesses), sections 2314 and 2315 (relating to interstate transportation of stolen property), sections 2341-2346 (relating to trafficking in contraband cigarettes), sec­tions 2421-24 <relating to white slave traffic>, (Cl any act which is indictable under title 29, United States Code, section 186 (dealing with restrictions on payments and loans to labor organizations) or section 501<c) <relating to embezzlement from union funds), or <D> any offense involving fraud connected with a case under title 11, fraud in the sale of securities, or the felonious manufacture. importation, receiving, concealment. buying, selling, or otherwise dealing in narcotic or other danger­ous drugs. punishable under any law of the United States;

<2> "State" means any State of the UnitedStates, the District of Columbia, the Com­monwealth of Puerto Rico, any territory or possession of the United States, any political subdivision, or any department, agency, or in­strumentality thereof;

(3) "person" includes any individual orentity capable of holding a legal or beneficial interest in property;

(4) "enterprise" includes any individual,partnership, corporation, association, or other legal entity, and any union or group of indi­viduals associated in fact although not a legal entity;

( 5) "pattern of racketeering activity" re­quires at least two acts of racketeering activi­ty, one of which occurred after the effective date of this chapter and the last of which oc­curred within ten years (excluding any period of imprisonment) after the commission of a prior act of racketeering activity;

(6) "unlawful debt" means a debt (A) in­curred or contracted in gambling activity which was in violation of the law of the United States, a State or political subdivision thereof, or which is unenforceable under State or Federal law in whole or in part as to principal or interest because of the laws relat­ing to usury, and (Bl which was incurred in connection with the business of gambling in violation of the law of the United States, a State or political subdivision thereof, or the business of lending money or a thing of value at a rate usurious under State or Federal law, where the usurious rate is at least twice the enforceable rate;

(7) "racketeering investigator" means anyattorney or investigator so designated by the Attorney General and charged with the duty of enforcing or carrying into effect this chap­ter;

(8) "racketeering investigation" means anyinquiry conducted by any racketeering inves­tigator for the purpose of ascertaining wheth­er any person has been involved in any viola­tion of this chapter or of any final order, judgment, or decree of any court of the United States. duly entered in any case or proceeding arising under this chapter;

(9) "documentary material" includes anybook. paper, document, record, recording, or other material; and

(10) "Attorney General" includes the Attor­ney General of the United States, the Deputy Attorney General of the United States, any Assistant Attorney General of the United States, or any employee of the Department of Justice er any employee of any department or

- agency of the United States so designated bythe Attorney General to carry out the powersconferi:ed on the Attorney General by thischapter. Any department or agency so desig­nated may use in investigations authorized bythis chapter either the investigative provi­sions of this chapter or the investigativepower of such department or agency other­wise conferred by law.

<Added Pub. L. 91-452, title IX, § 901(a), Oct. 15, 1970, 84 Stat. 941, and amended Pub. L. 95-575, § 3(c), Nov. ·2, 1978, 92 Stat. 2465; Pub.L. 95-598, title III, § 314(g), Nov. 6, 1978, 92Stat. 2677.l

REFERENCES IN TEXT

The effective date of this chapter, referred to in par. (5), is Oct. 15, 1970.

AMENDMENTS

1978-Par. (l)(B). Pub. L. 95-575 inserted "sections 2341-2346 (relating to trafficking in contraband ciga­rettes)," following "sections 2314 and 2315 (relating to interstate transportation of stolen property),".

Par. ( 1 )(D). Pub. L. 95-598 substituted "fraud con­nected with a case under title 11" for "bankruptcy fraud".

EFFECTIVE DATE OF 1978 AMENDMENTS

Amendment by Pub. L. 95-598 effective Oct. 1, 1979, see section 402(al of Pub. L. 95-598, set out as an Ef­fective Date note preceding section 101 of Title 11, Bankruptcy.

Amendment by Pub. L. 95-575 effective Nov. 2, 1978. see section 4 of Pub. L. 95-575. set out as an Effective Date note under section 2341 of this title.

SHORT TITLE

Section 1 of Pub. L. 91-452 provided in part: "That this Act [enacting sections 841 to 848. 1511. 1623, 1955. 1961 to 1968. 3331 to 3334. 3503. 3504. 3575 to 3578, and 6001 to 6005 of this title. and section 1826 of Title 28. Judiciary and Judicial Procedure, amending sec­tions 835, 1073, 1505, 1954. 2424. 2516, 2517, 3148. 3486.and 3500 of this title, sections 15. 87f. 135c. 499m. and2115 of Title 7, Agriculture, section 25 of Title 11.Bankruptcy, section 1820 of Title 12. Banks and Bank­ing, sections 49, 77v. 78u. 79r. 80a-41, 80b-9, 155. 717m,1271, and 1714 of Title 15, Commerce and Trade, sec­tion 825f of Title 16, Conservation, section 1333 ofTitle 19. Customs Duties. section 373 of Title 21. Foodand Drugs, section 161 of Title 29, Labor, section 506of Title 33, Navigation and Navigable Waters. sections405 and 2201 of Title 42. The Public Health and Wel­fare, sections 157 and 362 of Title 45. Railroads. sec­tion 1124 of Title 46, Shipping, section 409 of Title 47.Telegraphs. Telephones. and Radio telegraphs, sec­tions 9. 43, 46, 916, and 1017, of former Title 49. Trans­portation. and section 1484 of Title 49. Appendix. sec­tion 792 of Title 50, War and National Defense. andsections 643a. 1152. 2026, and former section 2155 ofTitle 50. Appendix. repealing sections 837. 895, 1406 .and 2514 of this title. sections 32 and 33 of Title 15;sections 4874 and 7493 of Title 26. Internal RevenueCode, section 827 of Title 46, sections 47 and 48 offormer Title 49. and sections 121 to 144 of Title 50. en-

§ 1962 TITLE 18-CRIMES AND CRIMINAL PROCEDURE Page 362

acting provisions set out as notes under this section and sections 841, 1511, 1955, preceding 3331, preceding 3481, 3504, and 6001 of this title, and repealing provi­sions set out as a note under section 2510 of this title) may be cited as the 'Organized Crime Control Act of 1970'."

SEPARABILITY OF PROVISIONS Section 1301 of Pub. L. 91-452 provided that: "If the

provisions of any part of this Act [see Short Title note set out above) or the application thereof to any person or circumstances be held invalid, the provisions of the other parts and their application to other persons or circumstances shall not be affected thereby."

CONGRESSIONAL STATEMENT OF FINDINGS AND PuRPOSE

Section 1 of Pub. L. 91-452 provided in part that: "The Congress finds that Cl> organized crime in the

United States is a highly sophisticated, diversified, and widespread activity that annually drains billions of dollars from America's economy by unlawful con­duct and the illegal use of force, fraud, and corrup­tion; (2) organized crime derives a major portion of its power through money obtained from such illegal en­deavors as syndicated gambling, loan sharking, the theft and fencing of property, the importation and dis­tribution of narcotics and other dangerous drugs, and other forms of social exploitation; (3) this money and power are increasingly used to infiltrate and corrupt legitimate business and labor unions and to subvert and corrupt our democratic processes; (4) organized crime activities in the United States w�aken the stabil­ity of the Nation's economic system, harm innocent in­vestors and competing organizations, interfere with free competition, seriously burden interstate and for­eign commerce, threaten the domestic security, and undermine the general welfare of the Nation and its citizens; and (5) organized crime continues to grow be­cause of defects in the evidence-gathering process of the law inhibiting the development of the legally ad­missible evidence necessary to bring criminal and other sanctions or remedies to bear on the unlawful activities of those engaged in organized crime and be­cause the sanctions and remedies available to the Gov­ernment are unnecessarily limited in scope and impact.

"It is the purpose of this Act [see Short Title note above] to seek the eradication of organized crime in the United States by strengthening the legal tools in the evidence-gathering process, by establishing new penal prohibitions, and by providing enhanced sanc­tions and new remedies to deal with the unlawful ac­tivities of those engaged in organized crime."

LIBERAL CONSTRUCTION OF PROVISIONS; SUPERSEDURE OF F'ED.ERAL OR STATE LAws; AUTHORITY OF ATTOR­NEYS REPRESENTING UNITED STATES Section 904 of title IX of Pub. L. 91-452 provided

that: "(a) The provisions of this· title [enacting this chap­

ter and amending sections 1505, 2516, and 2517 of this title) shall be liberally construed to effectuate its re­medial purposes.

"(b) Nothing in this title shall supersede any provi­sion of Federal, State, or other law imposing criminal penalties or affording· civil remedies in addition to those provided for in this title.

"(c) Nothing contained in this title shall impair the authority of any attorney representing- the United States to-

"(l) lay before any grand jury impaneled by any district court of the United States any evidence con­cerning any alleged racketeering violation of law;

"C2) invoke the power of any such court to compel the production of any evidence before any such grand jury; or

"(3) institute any proceeding to enforce any order or process issued in execution of such power or to punish disobedience of any such order or process by any person."

§ 1962. Prohibited activities

(a) It shall be unlawful for any person whohas received any income derived, directly or in­directly, from a pattern of racketeering activity or through collection of an unlawful debt in which such person has participated as a princi­pal within the meaning of section 2, title 18, United States Code, to use or invest, directly or indirectly, any part of such income, or the pro­ceeds of such income, in acquisition of any in­terest in, or the establishment or operation of, any enterprise which is engaged in, or the activ­ities of which affect, interstate or foreign com­merce. A purchase of securities on the open market for purposes of investment, and without the intention of controlling or participating in the control of the issuer, or of assisting another to do so, shall not be unlawful under this sub­section if the securities of the issuer held by the purchaser, the members of his immediate family, and his or their accomplices in any pat­tern or racketeering activity or the collection of an unlawful debt after such purchase do not amount in the aggregate to one percent of the outstanding securities of any one class, and do not confer, either in law or in fact, the power to elect one or more directors of the issuer.

(bl It shall be unlawful for any person through a pattern of racketeering activity or through collection of an unlawful debt to ac­quire or maintain, directly or indirectly, any in­terest in or control of any enterprise which is engaged in, or the activities of which affect, in­terstate or foreign commerce.

(cl It shall be unlawful for any person em­ployed by or associated with any enterprise en­gaged in, or the activities of which affect, inter­state or foreign commerce, to conduct or par­ticipate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.

(d) It shall be unlawful for any person to con­spire to violate any of the provisions of subsec­tions 2 (al, (bl, or (c) of this section_

(Added Pub. L. 91-452, title IX, § 901(a), Oct. 15, 1970, 84 Stat. 942.l

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1963, 1964 of this title.

§ 1963. Criminal penalties

(al Whoever violates any provision of section 1962 of this chapter shall be fined not more than $25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States (1) any interest he has acquired or maintained in violation of section 1962, and (2) any interest in, security of, claim against, or property or contractual right of any kind af­fording a source of influence over, any enter­prise which he has established operated, con­trolled, conducted, or participated in the con­duct of, in violation of section 1962.

Cb) In any action brought by the United States under this section, the district courts of

'So in original. Probably should be "subsection".

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

ORGANIZED CRIME CONTROL ACT OF 1970

For Lcgislati·ve History of rlct,.sce p. 4007

PUBLIC LAW 91-452; 84 STAT. 922 [S. 30]

An Act relating to the control of organized crime In the United Statea.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That:

This Act may be cited as the "Organized Crime Control Act of 1970."

STATE:l!EXT OF FINDINGS A!',;D PURPOSE

The Congress finds that (1) organized crime in the United States is a highly sophisticated, diversified, and widespread activity that annually drains billions of dollars from America's economy by un­lawful conduct and the illegal use of force, fraud, and corruption; (2) organized crime derives a major portion of its power throughmoney obtained from such illegal endeavors as syndicated gambling,loan sharking, the theft and fencing of property, the importation anddistribution of narcotics and other dangerous drugs, and other formsof social exploitation; (3) this money and power are increasinglyused to infiltrate and corrupt legitimate business and labor unionsand to subvert and corrupt our democratic processes; ( 4) organizedcrime activities in the United States weaken the stability of theNation's economic system, harm innocent investors and competingorganizations, interfere with free competition, seriously burden in­terstate and foreign commerce, threaten the domestic security, andundermine the general welfare of the Nation and its citizens; and(5) organized crime continues to grow because of defects in the evi­dence-gathering process of the law inhibiting the development of thelegally admissible evidence necessary to· bring criminal and othersanctions or remedies to bear on the unlawful activities of those en­gaged in organized crime and because the sanctions and remediesavailable to the Government are unnecessarily limited in scope andimpact.

It is the purpose of this Act to seek the eradication of organized crime in the United States by strengthening the legal tools in the evi­dence-gathering process, by establishing new penal prohibitions, and by providing enhanced sanctions and new remedies to deal with the unlawful activities of those engaged in organized crime.

l U.S.Cong. & Adm.Nt"' '70-b8 1073

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

necessary, without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, and without regard to the .provisions_ of chapter 51 and sub­chapter III of chapter 53 of such title· relating to classification and General Schedule pay rates, bu·t at rates not in excess of the maximum rate for GS-18 of the General Schedule under section 5332 of such title; and

(2) procure temporary and intermittent services to_ the sameextent as is authorized by section 3109 of title 5, United States Code, but at rates not to exceed $100 a day for individuals.

(b) In making appointments pursuant to this subsection, theChairman shall include among his appointments individuals deter­mined by the Chairman to be competent social scier1tists, lawyers, and law enforcement officers.

EXPENSES

Sec. 809. There are hereby authorized to be appropriated to the Commission such sums as may be necessary to carry this title into effect.

PART E-GENERAL PROVISIONS

Sec. 810. Paragraph (c), subsection (1), Section 2516, title 18, United States Code,94 is amended by adding "section 1511 (obstruc­tion of State or local law enforcement)," after "section 1510 (ob­struction of criminal investigations)," and by adding "section 1955 (prohibition of business enterprises of gambling)," after "section 1954 (offer, acceptance, or solicitation to influence operations of employee benefit plan),".

Sec. 811. No provision of this title indicates an intent on the part of the Congress to occupy the field in which such provision operates to the exclusion of the law of a State or possession, or a political subdivision of a State or possession, on the same subject matter, or to relieve any person of any obligation imposed by any law of any State or possession, or political subdivisio� of a State or possession.

TITLE IX-RACKETEER INFLUENCED AND

CORRUPT ORGANIZATIONS

Sec. 901. (a) Title 18, United States Code,�;; is amended by add­ing immediately after chapter 95 thereof the following new chapter:

"Sec.

"1961.

"1962. "19 63.

"1964.

"1965.

"1966.

"Chapter 96.-RACKETEER INFLUENCED AND

CORRUPT ORGANIZATIONS

Definitions.

Prohibited racketeering activities.

Criminal penalties.

Civil remedies.

Venue and process.

Expedition or actions.

94. 18 U.S.C.A. § 2516(1) (C). 95. 18 U.S.C.A. H 1961 to 1968.

1095

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS.

"Sec. "1967. "1968.

Evidence.

Civil investigative demand.

"§ 1961. Definitions --

"As used in this chapter-

Oct. 15

" ( 1) 'racketeering activity' means (A) any act or threat in­volving murder, kidnaping, gambling, arson, robbery, bribery, extortion, or dealing in narcotic or other dangerous drugs, which is chargeable under State law and punishable by imprisonment for more than one year; (B) any act which is indictable under any of the following provisions of title 18, United States Code: Section 201 (relating to bribery), section 224 (relating to sports bribery), sections 471, 472, and 473, relating to counterfeiting),

section 659 (relating to theft from interstate shipment) if the act indictable under section 659 is felonious, section 664 (re­

lating to embezzlement from pension and welfare funds), sec­tions 891-894 (relating to extortionate credit transactions), sec­tion 1084 (relating to the transmission. of gambling informa­tion), section 134_1 (relating to mail fraud), section 1343 (re­lating to wire fraud), section 1503 (relating to obstruction of justice), section 1510 (relating to obstruction of criminal in­vestigations), section 1511 (relating to the obstruction of State or local law enforcement), section 1951 (relating to interference with commerce, robbery, or extortion), section 1952 (relating to racketeering), section 1953 (relating to interstate transporta­tion of wagering paraphernalia), section 1954 (relating to un­lawful welfare fund payments), section 1955 (relating to the prohibition of illegal gambling businesses), sections 2314 and 2315 (relating to interstate transportation of stolen property), sections 2421-24 (relating to white slave traffic), (C) any act which is indictable under title 29, United States Code, section 186 (dealing with restrictions on payments and loans to labor organizations) or section 501(c) (relating to embezzlement from union funds), or (D) any offense involving bankruptcy fraud, fraud in the sale of securities, or the felonious manu­facture, importation, receiving, concealment, buying, selling, or otherwise dealing in narcotic or other dangerous drugs, punish­able under any law of the United States;

"(2) 'State' means any State of the United States, the Dis­trict of Columbia, the Commonwealth of Puerto Rico, any territory or possession of the United States, any political sub­division, or any department, agency, or instrumentality thereof;

"(3) 'person' includes any individual or entity capable of holding a legal or beneficial interest in property;

" ( 4) 'enterprise' includes any individual, partnership, cor­poration, association, or other legal entity, and any union or group of individuals associatJ!d in fact although not a legal entity;

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Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

"(5) 'pattern of racketeering activity' requires at least two acts of racketeering activity, one of which occurred after the effective date of this chapter and the last of which occurred within ten years (excluding any perio<!_ p_f imprisonment) after the commission of a prior act .of racketeering activity;

"(6) 'unlawful debt' means a debt ·(A) incurred or contracted in gambling activity which was in violation of the law of the United States, a State or political subdivision thereof, or which is unenforceable under State or Federal law in whole or in part as to principal or interest because of the laws relating· to usury, and (B) which was incurred in connection with the business of gambling in violation of the law of the United States, a State or political subdivision thereof, or the business of lending money or a thing of value at a rate usurious under State or Federal law, where the usurious rate is at least twice the enforceable rate;

"(7) 'racketeering investigator' means any attorney or in­vestigator so designated by the Attorney General and charged with the duty of enforcing or carrying into effect this chapter;

"(8) 'racketeering investigation' means any inquiry conducted by any racketeering investigator for the purpose of ascertain­ing whether any person has been involved in any violation of this chapter or of any final order, judgment, or decree of any court of the United States, duly entered in any case or pro­ceeding arising under this chapter;

"(9) 'documentary material' includes any book, paper, docu­ment, record, recording, or other material; and

"(10) 'Attorney General' includes the Attorney General of the United States, the Deputy Attorney General of the United States, any Assistant Attorney General of the United States, or any employee of the Department of Justice or any em­ployee of any department or agency of the United States so designated by the Attorney General to carry out the powers conferred on the Attorney General by this chapter. Any de­partment or agency so designated may use in investigations au­thorized by this chapter either the investigative provisions of this chapter or the investigative power of such department or agency otherwise conferred by law.

"§ 1962. Prohibited activities

"(a) It shall be unlawful for any person who has received any income derived, directly or indirectly, from a pattern of racketeering activity or through collection of an unlawful debt in which such person has participated as a principal within the meaning of section 2, title 18, United States Code, to use or invest, directly or indirectly, any part of such income, or the proceeds of such income, in ac­quisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce. A purchase of securities on the open market for purposes of investment, and without the intention of controlling or participating in the control of the issuer, or of

1097

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

assisting another to do so, shall not be unlawful under this sub­section if the securities _of the issuer held by the purchaser, the members of his immediate family, and his or their accomplices in any pattern or racketeering activity of the collection of an unlawful debt after such purchase do not amount in the aggregate to one percent of the outstanding securities of any one class, and do not confer, either in law or in fact, the power to elect one or more directors of the issuer.

"(b) It shall be unlawful for any person through a pattern of racketeering activity or through collection of an unlawful debt to acquire or maintain, directly or indirectly, any interest in or con­trol of any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce.

"(c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.

"(d) It shall be unlawful for any person to conspire to violate any of the provisions of subsections (a), (b), or (c) of this section.

"§ 1963. Criminal penalties

"(a) Whoever violates any prov1s1on of section 1962 of this chapter shall be fined not more than $25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States (1) any interest he has acquired or maintained in violation of section1962, and (2) any interest in, security of, claim against, or propertyor contractual right of any kind affording a source of influenceover, any enterprise which he has established, operated, controlled,conducted, or participated in the conduct of, in violation of section1962.

"(b) In any action brought by the United States under this section, the district courts of the United States shall have jurisdiction to enter such restraining orders or prohibitions, or to take such other actions, including, but not limited to, the acceptance of satisfactory performance bonds, in connection with any property or other interest subject to forfeiture under this section, as it shall deem proper .

"(c) Upon conviction of a person under this section, the court shall authorize the Attorney General to seize all property or other interest declared forfeited under this section upon such terms and conditions as the court shall deem proper. If a property right or other interest is not exercisable or transferable for value by the United States, it shall expire, and shall not revert to the con­victed person. All provisions of law relating to the disposition of property, or the proceeds from the sale thereof, or the remission or mitigation of forfeitures for violation of the customs laws, and the compromise of claims-and the award of compensation to informers in respect of such forfeitures shall apply to forfeitures incurred, or alleged to have been incurred, under the provisions of this section, insofar as applicalife- and not · inconsistent with the provisions

1098

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

hereof. Such duties as are imposed upon the collector of customs or any other person with respect to the disposi!ip_n of property under the customs laws shall be performed under this chapter by the Attorney General. The United States shall' dispose of all such prop­erty as soon as commercially feasible making· due provision for the rights of innocent persons.

"§ 1964. Civil rem'edies "(a) The district courts of the United States shall have juris­

diction to prevent and restrain violations of section 1962 of this chapter by issuing appropriate orders, including, but not limited to: ordering any person to divest himself of any interest, �irect or in­direct, in any enterprise; imposing reasonable restrictions on the future activities or investments of any person, including, but not limited to, prohibiting any person from engaging in the same type of endeavor as the enterprise engaged in, the activities of which affect interstate or foreign commerce; or ordering dissolution or reorganization of any enterprise, making due provision for the rights of innocent pesons.

"(b) The Attorney General may institute proceedings under this section. In any action brought by the United States under this section, the court shall proceed as soon as practicable to the hearing and determination thereof. Pending final determination thereof, the court may at any time enter such restraining orders or prohibitions, or take such other actions, including the acceptance of satisfactory performance bonds, as it shall deem proper.

"(c) Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the cost of the suit, including a reason­able attorney's fee.

"(d) A final judgment or decree rendered in favor of the United States in any criminal proceeding brought· by the United States under this chapter shall estop the defendant from denying the essen­tial allegations of the criminal offense in any subsequent civil pro­ceeding brought by the United States.

"§ 1965. Venue and process "(a) Any civil action or proceeding under this chapter against

any person may be instituted in the district court of the United States for any district in which such person resides, is found, has an agent, or transacts his affairs.

"(b) In any action under section 1964 of this chapter in any district court of the United States in which it is shown that the ends of justice require that other parties residing in any other district be brought before the court, the court may cause such parties to be summoned, and process for that purpose may be served in any judicial district of the United States by the marshal thereof.

"(c) In any civil or criminal action or proceeding instituted by the United States under this chapter in the district court of the

1099

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

United States for any judicial district, subpenas issued by such court to compel the attendance of witnesses may be served in any other judicial district, except that in any civil action or proceeding no such subpena shall be issued for service upon any individual who resides in another district at a place more than one hundred miles from the place at which such court is held without approval given by a judge of such court upon a showing of good cause.

"(d) All other process in any action or proceeding under this chapter may be served on any person in any judicial district in which such person resides, is found, has an agent, or transacts his affairs.

"§ 1966. Expedition of actions "In any civil action instituted under this chapter by the United

States in any district court of the United States, the Attorney Gen­eral may file with the clerk of such court a certificate stating that in his opinion the case is of general public importance. A copy of that certificate shall be furnished immediately by such clerk to the chief judge or in his absence to the presiding district judge of the district in which such action is pending. Upon receipt of such copy, such judge shall designate immediately a judge of that district to hear and determine action. The judge so desigated shall assign such action for hearing as soon as practicable, participate in the hearings and determination thereof, and cause such action to be expedited in every way.

"§ 1967. Evidence "In any proceding ancillary to or in any civil action instituted by

the United States under this chapter the proceedings may be open or closed to the public at the discretion of the court after consid­eration of the rights of affected persons.

"§ 1968. Civil investigative demand "(a) Whenever the Attorney General has reason to believe that

any person or enterprise may be in possession, custody, or control of any documentary materials relevant to a racketeering investiga­tion, he may, prior to the institution of a civil or criminal pro­ceeding thereon, issue in writing, and cause to be served upon such person, a civil investigative demand requiring such person to pro­duce such material for examination.

"(b) Each such demand shall-"(1) state the nature of the conduct constituting the alleged

racketeering violation which is under investigation and the pro­vision of law applicable thereto;

•� (2) describe the class or classes of documentary materialproduced thereunder with such definiteness and certainty as

to permit such m�terial to be fairly identified; "(3) state that the demand is returnable forthwith or pre­

scribe a return date which will provide a reasonable period of time within which-the material so demanded may be assembled

1100

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

and made available for inspection and. copying ·or reproduction; and

"(4) identify the custodian to whom such _material shall be made available.

"(c) No such demand shall-"(1) contain any requirement which would be held to be un­

reasonable if contained in a subpena duces tecum issued by a court of the United States in aid of a grand jury investigation of such alleged racketeering violation; or

"(2) require the production of any documentary e,vidence which would be privileged from disclosure if demanded by a sub­pena duces tecum issued by a court of the United States in aid of a grand jury investigation of such alleged racketeering vio­lation.

"(d) Service of any such demand or any petition filed under this section may be made upon a person by-

" (1) delivering a duly executed copy thereof to any partner, executive officer, managing agent, or general agent thereof, or to any agent thereof authorized by appointment or by law to re­ceive service of process on behalf of such person, or upon any individual person;

"(2) delivering a duly executed copy thereof to the principal office or place of business of the pe.rson to be served; or

"(3) depositing such copy in the United States mail, by reg­istered or certified mail duly addressed to such person at its principal office or place of business.

"(e) A verified return by the individual serving any such demand or petition setting forth the manner of such service shall be prima facie proof of such service. In the case of service by registered or certified mail, such return shall be accompanied by the return post office receipt of delivery of such demand.

"(f) ( 1) The Attorney General shall designate a racketeering in­vestigator to s�rve as racketeer document custodian, and such addi­tional racketeering investigators as he shall determine from time to time to be necessary to serve as deputies to such officer.

"(2) Any person upon whom any demand issued under this section has been duly served shall make such material available for inspec­tion and copying or reproduction to the custodian designated therein at the principal place of business of such person, or at such other place as such custodian and such person thereafter may agree and prescribe in writing or as the court may direct, pursuant to this sec­tion on the return date specified in such demand, or on such later date as such custodian may prescribe in writing. Such person may upon written agreement between such person and the custodian sub­stitute for copies of all or any part of such material originals there­of.

"(3) The custodian to whom any documentary material is so de­livered shall take physical possession thereof, and shall be responsi­ble for the use made thereof and for the return thereof pursuant to

1101

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

this chapter. The c;_ustodian may cause the preparation of such copies of such documentary material as may be required for official use under regulations w.hich shall be promulgated by the Attorney General. While in the possession of the custodian, no material so produced shall be available for examination, without the consent of the person who produced such material, by any individual other than the Attorney General. Under such reasonable terms and conditions as the Attorney General shall prescribe, documentary material while in the possession of the custodian shall be available for examination by the person who produced such material or any duly authorized representatives of such person.

" ( 4) Whenever any attorney has been designated to appear on be­half of the United States before any court or grand jury in any case or proceeding involving any alleged violation of this chapter, the custodian may deliver to such attorney such documentary material in the possession of the custodian as such attorney determines to be required for use in the presentation of such case or proceeding on behalf of the United States. Upon the conclusion of any such case or proceeding, such attorney shall return to the custodian any docu­mentary material so withdrawn which has not passed into the con­trol of such court or grand jury through the introduction thereof into the record of such case or proceeding.

"(5) Upon the completion-"(i) the racketeering investigation for which any docu­

mentary material was produced under this chapter, and "(ii) any case or proceeding arising from such investigation,

the custodian shall return to the person who produced such ma­terial all such material other than copies thereof made by the Attorney General pursuant to this subsection which has not passed into the control of any court or grand jury through the introduction thereof into the record of such case or proceeding.

"(6) When any documentary material has been produced by any person under this section for use in any racketeering investigation, and no such case or proceeding arising therefrom has been instituted within a reasonable time after corrrpletion of the examination and analysis of all evidence assembled in the course of such investiga­tion, such person shall be entitled, upon written demand made upon the Attorney General, to the return of all documentary material other than copies thereof made pursuant to this subsection so pro­duced by such person.

"(7) In the event of the death, disability, or separation from service of the custodian of any documentary material produced un­der any demand issued under this section or the official relief of such custodian from responsibility for the custody and control of such material, the Attorney General shall promptly-

" (i) designate another racketeering investigator to serve as custodian thereof,_ and "(ii) transmit notice in writing to the person who produced

such material as to the identity and address of the successor so designated.

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Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

Any successor so designated shall have with regard to such materi­als all duties and responsibilities imposed by this section upon his predecessor in office with regard thereto, except-that he shall not be held responsible for any default or dereliction which occurred be­fore his designation as custodian.

"(g) Whenever any person fails to comply w·ith any civil investi­gative demand duly served upon him under this section or whenever satisfactory copying or reproduction of any such material cannot be done and such person refuses to surrender such material, the At­torney General may file, in the district court of the United States for any judicial district in which such person resides, is found, or trans­acts business, and serve upon such person a petition for an order of such court for the enforcement of this section, except that if such person transacts business in more than one such district such peti­tion shall be filed in the district in which such person maintains his principal place of business, or in such other district in which such person transacts business as may be agreed upon by the parties to such petition.

"(h) Within twenty days after the service of any such demand up­on any person, or at any time before the return date specified in the demand, whichever period is shorter, such person may file, in the district court of the United States for the judicial district within which such person resides, is found, or transacts business, and serve upon such custodian a petition for an order of such court modify. ing or setting aside such demand. The time allowed for compliance with the demand in whole or in part as deemed proper and ordered by the court shall not run during the pendency of such petition in the court. Such petition shall specify each ground upon which the pe­titioner relies in seeking such relief, and may be based upon any failure of such demand to comply with the provisions of this section or upon any constitutional or other legal right or privilege of such person.

"(i) At any time during which any custodian is in custody or con­trol of any documentary material delivered by any person in com­pliance with any such demand, such person may file, in the district court of the United States for the judicial district within which the office of such custodian is situated, and serve upon such custodian a petition for an order of such court requiring the performance by such custodian of any duty imposed upon him by this section.

"(j) Whenever any petition is filed in any district court of the United States under this section, such court shall have jurisdiction to hear and determine the matter so presented, and to enter such or­der or orders as may be required to carry into effect the provisions of this section."

(b) The table of contents of part I, title 18, United States Code,is amended by adding immediately after "95. Racketeering ...................................... 1951"

the following new item: "96. Racketeer Influenced and Corrupt Organizations . . . . . . . . 1961"

1103

P.L. 91-452 LAWS_ OF 91st CONG.-2nd SESS. Oct. 15

Sec. 902. (a) Paragraph (c), subsection (1), section 2516, title 18, United States Code,96 is amended by inserting at the end there­of between the parenthesis and the semicolon ", section 1963 (vio­lations with respect to racketeer influenced and corrupt organiza­tions)".

(b) Subsection ( 3), section 2517, title 18, United States Code, 97 isamended by striking "criminal proceedings in any court of the Unit­ed States or of any State or in any Federal or State grand jury pro­ceeding" and inserting in lieu thereof "proceeding held under the authority of the United States or of any State or political subdivision thereof".

Sec. 903. The third paragraph, section 1505, title 18, United States Code,118 is amended by inserting "or section 1968 of this title" after "Act" and before "willfully".

Sec. 904. (a) The provisions of this title shall be liberally con­strued to effectuate its remedial purpo_ses.

(b) Nothing in this title shall supersede any provision of Federal,State, or other law imposing criminal penalties or affording civil remedies in addition to those provided for in this title.

(c) Nothing contained in this title shall impair the authority ofany attorney representing the United States to-

(1) lay before any grand jury impaneled by any district courtof the United States any evidence concerning any alleged racket­eering violation of law;

(2) invoke the power of any such court to compel the pro­duction of any evidence before any such grand jury; or

(3) institute any proceeding to enforce any order or processissued in execution of such power or to punish disobedience of any such order or process by any person.

TITLE X-DANGEROUS SPECIAL

OFFENDER SENTENCING

Sec. 1001. (a) Chapter 227, title 18, United States Code,99 is amended by adding at the end thereof the following new sections:

"§ 3575. Increased sentence for dangerous special offenders "(a) Whenever an attorney charged with the prosecution of a de­

fendant in a f!Ourt of the United States for an alleged felony com­mitted when the defendant was over the age of twenty-one years has reason to believe that the defendant is a dangerous special offender such attorney, a reasonable time before trial or acceptance by the court of a plea of guilty or nolo contendere, may sign and file with the court; and may amend, a notice (1) specifying that the defend­ant is a dangerous special offender who upon conviction for such felony is subject to the. imposition of a sentence under subsection (b) of this section, and (2) setting out with particularity the rea­sons why such attorney believes the defendant to be a dangerous

96. 18 U.S.C.A. I 2516(1) (c). 97. 18 U.S.C.A. I 2517(3).

98. 18 U.S.C.A. I 1505, 3rd par. 99. 18 U.S.C.A. It 3575 to 3578.

1104

UNITED STATE·s CODE e�a,u1,II�

N�

91st Congress-Second Session

1970

Convened January 19, 1970

Adjourned January 2, 1971

Volume 1 LAWS

IIT. PAlJ'L, KIN_N.

W E S T PU B LI SH IN G C 0.

Oct. 14 Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

ORGANIZED CRIME CONTROL ACT OF 1970

For Legislati-ve History of Act,...see p. 4007

PUBLIC LAW 91-452; 84 STAT. 922 [S. 30]

An Act relating to the control of organized crime in the United States.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That:

This Act may be cited as the "Organized Crime Control Act of 1970."

STATEMENT OF FINDINGS AND PURPOSE

The Congress finds that ( 1) organized crime in the United States is a highly sophisticated, diversified, and widespread activity that annually drains billions of dollars from America's economy by un­lawful conduct and the illegal use of force, fraud, and corruption; (2) organized crime derives a major portion of its power throughmoney obtained from such illegal endeavors as syndicated gambling,loan sharking, the theft and fencing of property, the importation anddistribution of narcotics and other dangerous drugs, and other formsof social exploitation; (3) this money and power are increasinglyused to infiltrate and corrupt legitimate business and labor unionsand to subvert and corrupt our democratic processes; ( 4) organizedcrime activities in the United States weaken the stability of theNation's economic system, harm innocent investors and competingorganizations, interfere with free competition, seriously burden in­terstate and foreign commerce, threaten the domestic security, andundermine the general welfare of the Nation and its citizens; and(5) organized crime continues to grow because of defects in the evi­dence-gathering process of the law inhibiting the development of thelegally admissible evidence necessary to· bring criminal and othersanctions or remedies to bear on the unlawful activities of those en­gaged in organized crime and because the sanctions and remediesavailable to the Government are unnecessarily limited in scope andimpact.

It is the purpose of this Act to seek the eradication of organized crime in the United States by strengthening the legal tools in the evi­dence-gathering process, by establishing new penal prohibitions, and by providing enhanced sanctions and new remedies to deal with the unlawful activities of those engaged in organized crime.

l U.S.Cong. & Adm.News '70-68 1073

Oct. 15 Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

necessary, without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, and without regard to the .provisions_ of chapter 51 and sub­chapter III of chapter 53 of such title· relating to classification and General Schedule pay rates, but at rates not in excess of the maximum rate for GS-18 of the General Schedule under section 5332 of such title; and

(2) procure temporary and intermittent services to_ the sameextent as is authorized by section 3109 of title 5, United States Code, but at rates not to exceed $100 a day for individuals.

(b) In making appointments pursuant to this subsection, theChairman shall include among his appointments individuals deter­mined by the Chairman to be competent social scientists, lawyers, and law enforcement officers.

EXPENSES

Sec. 809. There are hereby authorized to be appropriated to the Commission such sums as may be necessary to carry this title into effect.

PART E-GENERAL PROVISIONS

Sec. 810. Paragraph (c), subsection (1), Section 2516, title 18, United States Code,94 is amended by adding "section 1511 (obstruc­tion of State or local law enforcement)," after "section 1510 ( ob­struction of criminal investigations)," and by adding "section 1955 ( prohibition of business enterprises of gambling)," after "section 1954 (offer, acceptance, or solicitation to influence operations of employee benefit plan)," .

Sec. 811. No provision of this title indicates an intent on the part of the Congress to occupy the field in which such provision operates to the exclusion of the law of a State or possession, or a political subdivision of a State or possession, on the same subject matter, or to relieve any person of any obligation imposed by any law of any State or possession, or political subdivisio� of a State or possession .

TITLE IX-RACKETEER INFLUENCED AND

CORRUPT ORGANIZATIONS

Sec. 901. (a) Title 18, United States Code,95 is amended by add­ing immediately after chapter 95 thereof the following new chapter:

"Sec. "1961. "1962. "19 63. "19 64, "1965. "1966.

"Chapter 96.-RACKETEER INFLUENCED AND

CORRUPT ORGANIZATIONS

Definitions. Prohibited racketeering activities. Criminal penalties. Civil remedies. Venue and process. Expedition of actions.

94. 18 U.S.C.A. § 2516(1) (c). 95. 18 U.S.C.A. §§ 1961 to 1968.

1095

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

"Sec.

"1967. Evidence. "1968. Civil investigative demand.

"§ 1961. Definitions --"As used in this chapter-

"(!) 'racketeering activity' means (A) any act or threat in­volving murder, kidnaping, gambling, arson, robbery, bribery, extortion, or dealing in narcotic or other dangerous drugs, which

is chargeable under State law and punishable by imprisonment

for more than one year; (B) any act which is indictable under

any of the following provisions of title 18, United States Code:

Section 201 (relating to bribery), section 224 (relating to sports

bribery), sections 471, 472, and 473, relating to counterfeiting),

section 659 (relating to theft from interstate shipment) if the act indictable under section 659 is felonious, section 664 (re­

lating to embezzlement from pension and welfare funds), sec­tions 891-894 (relating to extortionate credit transactions), sec­tion 1084 (relating to the transmission_ of gambling informa­tion), section 134_1 (relating to mail fraud), section 1343 (re­lating to wire fraud), section 1503 (relating to obstruction of justice), section 1510 (relating to obstruction of criminal in­vestigations), section 1511 (relating to the obstruction of State or local law enforcement), section 1951 (relating to interference with commerce, robbery, or extortion), section 1952 (relating to racketeering), section 1953 ( relating to interstate transporta­tion of wagering paraphernalia), section 1954 (relating to un­lawful welfare fund payments), section 1955 (relating to the prohibition of illegal gambling businesses), sections 2314 and 2315 (relating to interstate transportation of stolen property), sections 2421-24 (relating to white slave traffic), (C) any act which is indictable under title 29, United States Code, section 186 (dealing with restrictions on payments and loans to labor organizations) or section 501(c) (relating to embezzlement from union funds), or (D) any offense involving bankruptcy fraud, fraud in the sale of securities, or the felonious manu­facture, importation, receiving, concealment, buying, selling, or otherwise dealing in narcotic or other dangerous drugs, punish­able under any law of the United States;

"(2) 'State' means any State of the United States, the Dis­trict of Columbia, the Commonwealth of Puerto Rico, any territory or possession of the United States, any political sub­division, or any department, agency, or instrumentality thereof;

"(3) 'person' includes any individual or entity capable of holding a legal or beneficial interest in property;

"(4) 'enterprise' includes any individual, partnership, cor­poration, association, or other legal entity, and any union or group of indivi'duals associat.J;!d in fact although not a legal entity;

1096

Oct. 15 Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

"(5) 'pattern of racketeering activity' requires at least two acts of racketeering activity, one of which occurred after the effective- date of this chapter and the last of which occurred within ten years (excluding.any periotj_ _p_f imprisonment) after the commission of a prior act .of racketeering activity;

"(6) 'unlawful debt' means a debt ·(A) incurred or contracted in gambling activity which was in violation of the law of the United States, a State or political subdivision thereof, or which is unenforceable under State or Federal law in whole or in part as to principal or interest because of the laws relating to usury, and (B) which was incurred in connection with the business of gambling in violation of the law of the United States, a State or political subdivision thereof, or the business of lending money or a thing of value at a rate usurious under State or Federal law, where the usurious rate is at least twice the enforceable rate;

"(7) 'racketeering investigator' means any attorney or in­vestigator so designated by the Attorney General and charged with the duty of enforcing or carrying into effect this chapter;

"(8) 'racketeering investigation' means any inquiry conducted by any racketeering investigator for the purpose of ascertain­ing whether any person has been involved in any violation of this chapter or of any final order, judgment, or decree of any court of the United States, duly entered in any case or pro­ceeding arising under this chapter;

"(9) 'documentary material' includes any book, paper, docu­ment, record, recording, or other material; and

"(10) 'Attorney General' includes the Attorney General of the United States, the Deputy Attorney General of the United States, any Assistant Attorney General of the United States, or any employee of the Department of Justice or any em­ployee of any department or agency of the United States so designated by the Attorney General to carry out the powers conferred on the Attorney General by this chapter. Any de­partment or agency so designated may use in investigations au­thorized by this chapter either the investigative provisions of this chapter or the investigative power of such department or agency otherwise conferred by law.

"§ 1962. Prohibited activities

"(a) It shall be unlawful for any person who has received any income derived, directly or indirectly, from a pattern of racketeering activity or through collection of an unlawful debt in which such person has participated as a principal within the meaning of section 2, title 18, United States Code, to use or invest, directly or indirectly, any part of such income, or the proceeds of such income, in ac­quisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce. A purchase of securities on the open market for purposes of investment, and without the intention of controlling or participating in the control of the issuer, or of

1097

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

assisting another to do so, shall not be unlawful under this sub­section if the securities _of the issuer held by the purchaser, the members of his immediate family, and his or their accomplices in any pattern or racketeering activity of the collection of an unlawful debt after such purchase do not amount in the aggregate to one percent of the outstanding securities of any one class, and do not confer, either in law or in fact, the power to elect one or more directors of the issuer.

"(b) It shall be unlawful for any person through a pattern of racketeering activity or through collection of an unlawful debt to acquire or maintain, directly or indirectly, any interest in or con­trol of any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce.

"(c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.

"(d) It shall be unlawful for any person to conspire to violate any of the provisions of subsections (a), (b), or (c) of this section.

"§ 1963. Criminal penalties "(a) Whoever violates any provision of section 1962 of this

chapter shall be fined not more than $25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States (1) any interest he has acquired or maintained in violation of section1962, and (2) any interest in, security of, claim against, or propertyor contractual right of any kind affording a source of influenceover, any enterprise which he has established, operated, controlled,conducted, or participated in the conduct of, in violation of section1962.

"(b) In any action brought by the United States under this section, the district courts of the United States shall have jurisdiction to enter such restraining orders or prohibitions, or to take such other actions, including, but not limited to, the acceptance of satisfactory performance bonds, in connection with any property or other interest subject to forfeiture under this section, as it shall deem proper.

"(c) Upon conviction of a person under this section, the court shall authorize the Attorney General to seize all property or other interest declared forfeited under this section upon such terms and conditions as the court shall deem proper. If a property right or other interest is not exercisable or transferable for value by the United States, it shall expire, and shall not revert to the con­victed person. All provisions of law relating to the disposition of property, or the proceeds from the sale thereof, or the remission or mitigation of forfeitures for violation of the customs laws, and the compromise of claims -and the award of compensation to informers in respect of such forfeitures shall apply to forfeitures incurred, or alleged to have been incurred, under the provisions of this section, insofar as applicabre- and not · inconsistent with the provisions

1098

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

hereof. Such duties as are imposed upon the collector of customs or any other person with respect to the disposi!i9_n of property under the customs laws shall be performed under this chapter by the Attorney General. The United States shall' dispose of all such prop­erty as soon as commercially feasible making- due provision for the rights of innocent persons.

"§ 1964. Civil remedies

"(a) The district courts of the United States shall have juris­diction to prevent and restrain violations of section 1962 of this chapter by issuing appropriate orders, including, but not limited to: ordering any person to divest himself of any interest, �irect or in­direct, in any enterprise; imposing reasonable restrictions on the future activities or investments of any person, including, but not limited to, prohibiting any person from engaging in the same type of endeavor as the enterprise engaged in, the activities of which affect interstate or foreign commerce; or ordering dissolution or reorganization of any enterprise, making due provision for the rights of innocent pesons.

"(b) The Attorney General may institute proceedings under this section. In any action brought by the United States under this section, the court shal I proceed as soon as practicable to the hearing and determination thereof. Pending final determination thereof, the court may at any time enter such restraining orders or prohibitions, or take such other actions, including the acceptance of satisfactory performance bonds, as it shall deem proper.

"(c) Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the cost of the suit, including a reason­able attorney's fee.

"(d) A final judgment or decree rendered in favor of the United States in any criminal proceeding brought· by the United States under this chapter shall estop the defendant from denying the essen­tial allegations of the criminal offense in any subsequent civil pro­ceeding brought by the United States.

"§ 1965. Venue and process "(a) Any civil action or proceeding under this chapter against

any person may be instituted in the district court of the United States for any district in which such person resides, is found, has an agent, or transacts his affairs.

"(b) In any action under section 1964 of this chapter in any district court of the United States in which it is shown that the ends of justice require that other parties residing in any other district be brought before the court, the court may cause such parties to be summoned, and process for that purpose may be served in any judicial district of the United States by the marshal thereof.

" ( c) In any civil or criminal action or proceeding instituted by the United States under this chapter in the district court of the

1099

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

United States for any judicial district, subpenas issued by such court to compel the attendance of witnesses may be served in any other judicial district, except that in any civil action or proceeding no such subpena shall be issued for service upon any individual who resides in another district at a place more than one hundred miles from the place at which such court is held without approval given by a judge of such court upon a showing of good cause.

"(d) All other process in any action or proceeding under this chapter may be served on any person in any judicial district in which such person resides, is found, has an agent, or transacts his affairs.

"§ 1966. Expedition of actions

"In any civil action instituted under this chapter by the United States in any district court of the United States, the Attorney Gen­eral may file with the clerk of such court a certificate stating that in his opinion the case is of general public importance. A copy of that certificate shall be furnished immediately by such clerk to the chief judge or in his absence to the presiding district judge of the district in which such action is pending. Upon receipt of such copy, such judge shall designate immediately a judge of that district to hear and determine action. The judge so desigated shall assign such action for hearing as soon as practicable, participate in the hearings and determination thereof, and cause such action to be expedited in every way.

"§ 1967. Evidence

"In any proceding ancillary to or in any civil action instituted by the United States under this chapter the proceedings may be open or closed to the public at the discretion of the court after consid­eration of the rights of affected persons.

"§ 1968. Civil investigative demand

"(a) Whenever the Attorney General has reason to believe that any person or enterprise may be in possession, custody, or control of any documentary materials relevant to a racketeering investiga­tion, he may, prior to the institution of a civil or criminal pro­ceeding thereon, issue in writing, and cause to be served upon such person, a civil investigative demand requiring such person to pro­duce such material for examination.

"(b) Each such demand shall-"(1) state the nature of the conduct constituting the alleged

racketeering violation which is under investigation and the pro­vision of law applicable thereto;

'�(2) describe the class or classes of documentary material produced thereunder with such definiteness and certainty as

to permit such m�terial to be fairly identified; "(3) state that the demand is returnable forthwith or pre­

scribe a return date which will provide a reasonable period of time within which-the material so demanded may be assembled

1100

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

and made available for inspection and. copying -dr reproduction; and

" ( 4) identify the custodian to whom such _material shall be made available.

"(c) No such demand shall-"(1) contain any requirement which would be held to be un­

reasonable if contained in a subpena duces tecum issued by a court of the United States in aid of a grand jury investigation of such alleged racketeering violation; or

"(2) require the production of any documentary e,vidence which would be privileged from disclosure if demanded by a sub­pena duces tecum issued by a court of the United States in aid of a grand jury investigation of such alleged racketeering vio­lation.

" ( d) Service of any such demand or any petition filed under this section may be made upon a person by-

" ( I) delivering a duly executed copy thereof to any partner, executive officer, managing agent, or general agent thereof, or to any agent thereof authorized by appointment or by law to re­ceive service of process on behalf of such person, or upon any individual person;

"(2) delivering a duly executed copy thereof to the principal office or place of business of the person to be served; or

"(3) depositing such copy in the United States mail, by reg­istered or certified mail duly addressed to such person at its principal office or place of business.

" ( e) A verified return by the individual serving any such demand or petition setting forth the manner of such service shall be prima facie proof of such service. In the case of service by registered or certified mail, such return shall be accompanied by the return post office receipt of delivery of such demand.

"(f)(l) The Attorney General shall designate a racketeering in­vestigator to serve as racketeer document custodian, and such addi­tional racketeering investigators as he shall determine from time to time to be necessary to serve as deputies to such officer.

"(2) Any person upon whom any demand issued under this section has been duly served shall make such material available for inspec­tion and copying or reproduction to the custodian designated therein at the principal place of business of such person, or at such other place as such custodian and such person thereafter may agree and prescribe in writing or as the court may direct, pursuant to this sec­tion on the return date specified in such demand, or on such later date as such custodian may prescribe in writing. Such person may upon written agreement between such person and the custodian sub­stitute for copies of all or any part of such material originals there­of.

"(3) The custodian to whom any documentary material is so de­livered shall take physical possession thereof, and shall be responsi­ble for the use made thereof and for the return thereof pursuant to

1101

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

this chapter. The c;_ustodian may cause the preparation of such copies of such documentary material as may be required for official use under regulations which shall be promulgated by the Attorney General. While in the possession of the custodian, no material so produced shall be available for examination, without the consent of the person who produced such material, by any individual other than the Attorney General. Under such reasonable terms and conditions as the Attorney General shall prescribe, documentary material while in the possession of the custodian shall be available for examination by the person who produced such material or any duly authorized representatives of such person.

" ( 4) Whenever any attorney has been designated to appear on be­half of the United States before any court or grand jury in any case or proceeding involving any alleged violation of this chapter, the custodian may deliver to such attorney such documentary material in the possession of the custodian as such attorney determines to be required for use in the presentation of such case or proceeding on behalf of the United States. Upon the conclusion of any such case or proceeding, such attorney shall return to the custodian any docu­mentary material so withdrawn which has not passed into the con­trol of such court or grand jury through the introduction thereof into the record of such case or proceeding.

"(5) Upon the completion-"(i) the racketeering investigation for which any docu­

mentary material was produced under this chapter, and "(ii) any case or proceeding arising from such investigation,

the custodian shall return to the person who produced such ma­terial all such material other than copies thereof made by the Attorney General pursuant to this subsection which has not passed into the control of any court or grand jury through the introduction thereof into the record of such case or proceeding.

"(6) When any documentary material has been produced by any person under this section for use in any racketeering investigation, and no such case or proceeding arising therefrom has been instituted within a reasonable time after completion of the examination and analysis of all evidence assembled in the course of such investiga­tion, such person shall be entitled, upon written demand made upon the Attorney General, to the return of all documentary material other than copies thereof made pursuant to this subsection so pro­duced by such person.

"(7) In the event of the death, disability, or separation from service of the custodian of any documentary material produced un­der any demand issued under this section or the official relief of such custodian from responsibility for the custody and control of such material, the Attorney General shall promptly-

" (i) designate another racketeering investigator to serve as custodian thereof,_ and "(ii) transmit notice in writing to the person who produced

such material as to the identity and address of the successor so designated.

1102

Oct. 15 ORGANIZED CRIME CONTROL ACT P.L. 91-452

Any successor so designated shall have with regard to such materi­als all duties and responsibilities imposed by this section upon his predecessor in office with regard thereto, except-that he shall not be held responsible for any default or dereliction which occurred be­fore his designation as custodian.

"(g) Whenever any person fails to comply w·ith any civil investi­gative demand duly served upon him under this section or whenever satisfactory copying or reproduction of any such material cannot be done and such person refuses to surrender such material, the At­torney General may file, in the district court of the United States for any judicial district in which such person resides, is found, or trans­acts business, and serve upon such person a petition for an order of such court for the enforcement of this section, except that if such person transacts business in more than one such district such peti­tion shall be filed in the district in which such person maintains his principal place of business, or in such other district in which such person transacts business as may be agreed upon by the parties to such petition.

"(h) Within twenty days after the service of any such demand up­on any person, or at any time before the return date specified in the demand, whichever period is shorter, such person may file, in the district court of the United States for the judicial district within which such person resides, is found, or transacts business, and serve upon such custodian a petition for an order of such court modify­ing or setting aside such demand. The time allowed for compliance with the demand in whole or in part as deemed proper and ordered by the court shall not run during the pendency of such petition in the court. Such petition shall specify each ground upon which the pe­titioner relies in seeking such relief, and may be based upon any failure of such demand to comply with the provisions of this section or upon any constitutional or other legal right or privilege of such person.

"(i) At any time during which any custodian is in custody or con­trol of any documentary material delivered by any person in com­pliance with any such demand, such person may file, in the district court of the United States for the judicial district within which the office of such custodian is situated, and serve upon such custodian a petition for an order of such court requiring the performance by such custodian of any duty imposed upon him by this section.

"(j) Whenever any petition is filed in any district court of the United States under this section, such court shall have jurisdiction to hear and determine the matter so presented, and to enter such or­der or orders as may be required to carry in to effect the provisions of this section."

(b) The table of contents of part I, title 18, United States Code,is amended by adding immediately after

"95. Racketeering ...................................... 1951"

the following new item:

"96. Racketeer Influenced and Corrupt Organizations ........ 1961"

1103

P.L. 91-452 LAWS OF 91st CONG.-2nd SESS. Oct. 15

Sec. 902. (a) Paragraph (c), subsection (1), section 2516, title18, United States Code,96 · is amended by inserting at the end there­of between the parenthesis and the semicolon ", section 1963 (vio­lations with respect to racketeer influenced and corrupt organiza­tions)".

(b) Subsection (3), section 2517, title 18, United States Code, 97 isamended by striking "criminal proceedings in any court of the Unit­ed States or of any State or in any Federal or State grand jury pro­ceeding" and inserting in lieu thereof "proceeding held under the authority of the United States or of any State or political subdivision thereof".

Sec. 903. The third paragraph, section 1505, title 18, United States Code,1l8 is amended by inserting "or section 1968 of this title" after "Act" and before "willfully".

Sec. 904. (a) The provisions of this title shall be liberally con­strued to effectuate its remedial purpo_ses.

( b) Nothing in this title shall supersede any provision of Federal,State, or other law imposing criminal penalties or affording civil remedies in addition to those provided for in this title.

(c) Nothing contained in this title shall impair the authority ofany attorney representing the United States to-

( 1) lay before any grand jury impaneled by any district courtof the United States any evidence concerning any alleged racket­eering violation of law;

(2) invoke the power of any such court to compel the pro­duction of any evidence before any such grand jury; or

(3) institute any proceeding to enforce any order or processissued in execution of such power or to punish disobedience of any such order or process by any person.

TITLE X-DANGEROUS SPECIAL

OFFENDER SENTENCING

Sec. 1001. (a) Chapter 227, title 18, United States Code,99 is amended by adding at the end thereof the following new sections:

"§ 3575. Increased sentence for dangerous special offenders "(a) Whenever an attorney charged with the prosecution of a de­

fendant in a �ourt of the United States for an alleged felony com­mitted when the defendant was over the age of twenty-one years has reason to believe that the defendant is a dangerous special offender such attorney, a reasonable time before trial or acceptance by the court of a plea of guilty or nolo contendere, may sign and file with the court; and may amend, a notice (1) specifying that the defend­ant is a dangerous special offender who upon conviction for such felony is subject to the. imposition of a sentence under subsection (b) of this section, and (2) setting out with particularity the rea­sons why such attorney believes the defendant to be a dangerous

96. 18 U.S.C.A. § 2516{1) (c). 97. 18 U.S.C.A. § 2517(3).

98. 18 U.S.C.A. § 1505, 3rd par. 99. 18 U.S.C.A. §§ 3575 to 3578.

1104

INTHODUC'l'ION

On October 15, 1970, the Organized Crime

Control Act of 1970 became law. Title IX of the

act created the Racketeer Influenced and Corrupt . . '

Organizations Statute (Title 18, United States

Code, Sections 1961-1968) commonly referred to

as the "RICO" statute. The legislative history

provides:

fl14 "The Congress finds that (1) organized crime in the United States is a hishly sophisticated, diversified, and widespread activity that annually drains billion::; o:' dollars fro:i1 America's econo�y . . . (2) • . • (3) this money and power are incrcasin6ly used to infiltrate and corrupt lebit­imate business . . . (4) orsanized crime activities in the Unitec St2tes weaken the stability o: the nation's economic system, harm innocent in­vestors and competing or�anizations, interfere wjth free compet!tion, seriously burden interstate and foreign com.mere e . . . " ?ub. L. No. 91-�52, Section 1 (1970) (as set forth in a note to 18 u.s.c.A. § 1961).

The Organized Crime Act of 1970 "shall be liberally

construed to effectuate its remedial purposes

Pub. L. No. 91-�52. Sec�ion 904 (set �o�th as

not c of l 8 U • S . C . A • § 19 61 ) , ( 19 7 0 ) .

The purpose o� the stat�te is to outlaw

the infiltration and illeGal acquisition o�

legitimate economic enterprises and the use of

AN ExrL/\1�/\TION OF T11E

RACKETEER INFLUENCEb

AND

CORRUPT ORGANIZATIONS

STATUTE

(TITLE 18 UNITED STATES CODE

SECTIONS 1961-196�)

PREPARED BY THE STAFF OF

STHIKE FORCE 18

0RGA�IZED (RIME AND RACKETEERING SECTION

CRIMIN�L DIVISION

UNITED STATES DEPARTl-iEIH OF JUSTICE

Posr OFFICE Box 571

BENJAMIN FRANKLIN STATIO�J

WASHINGTON, D.C, 20044

TELEPHONE: FTS - 202-739-3954

/.1✓ c_{:_O/'l_l,:!9.__.:f_J"�_T_t:'" ___ /JP: .'-:-'_I_!:'._,��

s,.12/ €ox 1.sS"" (_:; ,----:. 7,., ,/.- ,,,,,...,,._,y,',.,,,':. . .,/ (uv,,,.....(/t-,,.c)

PUHl'0:31-:

The purpose of the following materials is to

improve your understanding of the main fcntures

of the statute through a brief outline and dis­

cussion of what is outlawed; the clcmentn common

to th� crimes; the two methods available to prove

each crime; the interlocutory and perDanent

remedies available and what has been done to

date across the country to implement this

statute.

Strike Force 18 is responsible-for the

implementation of this statute. A complete

catalosue of materials utilized in prior and

on going cases is maintained for your·use and

benefit. These materials are ava,i1able upon

request. The success of the centralized f1lin6

and distribution system depends upon reciprocity .

leE;al and. 1llccnl enterprises to further cr1minn 1

activity and the di�ruption of our nation's economy.

To accomplish this objective, the Congress provided

substantial civil nnd criminal remedies to root

out the crim}nal-economic activity.

Section 1962 of the RICO statute outlaws

the specific activities throush the use of federal

and state crimes already on the statute books.

The statute is broad and varied in its &pplication

to meet the variety of crimes utilized by organized

criminals to use, infiltiate and acquire economic

enterprises.

The RICO statute does not add substantially

to the investigative or prosecutive burden. It

complements a case and improves the remedies

available. The statute does require a thorough

understanding and an inventive approach to a

factual pattern for effective practical

application

(2) Section 19G2(b) provide:,:

It chall bC' un]n\•tful for any_pcr�01� th1·011r,h :1 ratt�l'll of rnc:l�­e t <' �..:_.1_,_�G__!t__£;J_�.}.-S'l or t Ill' o u 1·.h c·o 1-l e ct J. on or 1111 un.J:,wrul dcht toncqufn� 01' lllltlnt.-ii'Jn' dJ1•ec t:1y orindlrcctly, �• j nt<·r�st. in orcontro) of ll'2Y c:ntcrpri:,i::- \·:hich1s cnc;ac;cd in, 01' the activ.itic:3of· Which affect, intcrstrite orforcicn commerce. (Emphasis sup­plied)

This section outlaws the acquisition or maintenance

Qf any interest or control in any enterprise

through illegal activity. �he gravamen of the crime

is the illegal acquisition or maintcnnncc of an -

interest or control. The obvious examples-are

acquisitions through extortion or a scheme to

defraud and the maintenance of an interest through

bribery.

(3) Section 1962(c) provides:

It shall be unlawful for anv_ _..._

person employed by or associ�ted with anv entcrnrisc engaccd in, or the activities of which affect, interstate or foreign commerce, to conduct or oarticinate, directly or indirectly, in the conduc-c of such enterprise's affairs throuch n pattern of r2.ckcteerinr; 2.ctivit:,• or. collection of an unlawful debt .

.

This section o�tlaws t�e � of an enterprise �o

comrni� illega: acts. Sectioo 1962(c) is designed

to reach those persons whc by employme�t or

2

•

The heart of the RICO Gtntutc is �ontnlncd

in Section 1962 which crcnten four new crime0:

(1) Section 1962(a) provides in

pertinent part:

It shall be unlawful for �rcrson who ha;. received �-; j nco;.1c derived, directly or indirectly, from a pattc1·n of_ racl�ctccr1n,--: activit:l or through colJ.ect.�c:. of nn unlnwful dcbt HH * to u�0 or invcGt, directly or indirectly, nnv n::i_t!_ of sue;h inco;;-ic, o:- tile Rrocecds of such inco�e, in acquisition of anv cntcrnrise which is cncaged in, or theactivities of which affec�, interstate or foreiGn commerce. (Emphasis supplied)

.,

This section outluws the acquisition of any enter­

prise with nny income derived from illegal activity.

�e gravamen of the offense is the ille6al deriva-

_tion.of the funds. The acquisition cnn in all respects

be legitimate. Congress simply makes it illegal to

invest 111-gotten gains. This is the most difficult

section to prove since you must trace the funds

into the enterprise. It should be noted that this

section does no� �pply tc a p�rchase of secu�ities

of any one class of less than or.e percer.t and

which does not confc� the power to elect o�e o�

more directors.

1

to the three substantive section5 are enorintial to

an understanding of how the statute can be applied

to orgnnized criminal-economic activity.

(1)

to include nny

or holding any

(2)

to include any:

association

a. Definltions

The term "person" is broadly defined

individual or organization capable

property interest.

The term "enterprise" is defined

or group of individuals associated in fact although

not a legal entity.

The term "a group of indlviduals associated

in fact" is a new concept desic;ned to reach

illegitimate enterprlscs engaged in illee;al activities.

Our experience has been that this concept cnn be

put to excellent use in the enforcement of

Section 1962(c). Cases have arisen where or�anized

criminals have banded together to commit illebal

acts which affect economic activity. The group

is only associated in fact and does not have any

c�mmonly know� legal appearance. The difficuity

with this concepi is the affirmative requirerne�t

of proving that the "enterprise" engages in or

has activities which affect interstate commerce .

0/

)

ns�JOciation in en cntcrpri!.c use thnt cnterpri:ie

to cneaGc in unlawful activities. One situation

would occur where the LCNhas a person (either nn

owner or employee) inside a business or a finan­

cial institution.

��) Section 1962(d) _provides:

It shall be unlawful for any person to conspiT� to violate �ny of the provisions of tjubscctions (a), (b) or (c) of this section.

This provision is powerful because it carries the

same substantial remedies as the substantive pro­

visions. In addition, it provides the tactical

latitude which is necessarr to meet cert�in

patterns of criminal activity.

In summary, it is clear that Co�gress sought

to stop the rlow of illeGally derived funds from

flowing into a business enterprise; to prevent the

outricht acquisition of any interest or control

illebal activity; to prevent the maintenance of

any interest or control in an enterprise by illegal

activity and the use.of any enterprise to commit

1llq�al acts.

DEFINITIONS AND CO!•iMON ELEMEN'?S

-:_·. __ A thorough knowledge of the defini ti ens

provided 1n Section 1961 and the elements common

3

of racketccrinr; charr;cd in order to c:.;tnblich a

pattern a::; required Jn each ::,cctlon of the ntntutc.

It will be ob::;c1·ved that the actn of rnclcctccrinr;

include ntntc felonies; certain violations of

Title 18 of the United States Code; labor violations

of Title 29, U!'}lted States Code; Danlcruptcy and

Securities Fraud _and federal narcotics violations.

These violations are:

a. Violations of State Law - Felonies

(1) Act or Threat Involving Murder(2) Kidnapping( 3) Gambling(�) Arson ( 5) Robb0ry(6) Bribery(7) Extortion � (8) Dealing - Narcotic Dangerous DruG

b. Violations of 18 U.S.C.

(1) (2) (3)

(�)

(5)

(6)

(7)

(8) (9)

(10) (11)

(12)

Section 201 (Bribery) Section 224 (Sports Bribery) Sections 1171, 472, 472 (Counter-

fcitine;) Section 659 (Theft from Interstate

Shipment) (Felony) Section 6611 (Embezzlement from

Pension and Welfare Fund) Sections 891, 892, 893, 894

(Extortionate Credit Transactions) Section 1084 (Transmission of

Gamblin� Information) Section 13111 (i-�ail Fraud) Section 1343 (Wire Fraud) Section 1503 (Ob0truction of Justice) Section 1510 (Obstruction of C�iminal

Investigation) Section 1511 (Obstruction of State

o� Local Law Enforcement)

6

The breadth of \;h0 statute in further cxpre�ocd

in the use of the wordn "direct" and "indirect".

In Section 19G2(n) the income gnincd cnn be derived

dircctl� or indirectly from the illegal activity.

In Section 1962(b) the acquisition or maintcnar1cc

of an interest or control can be direct or indirect.

In Section 1962(c) the conduct or participation in

the affairs of the enterprise can be direct or

indirect.

b. Common Elements

Violations of Section 1962(a), (b) or (c) can

be established either through proof of a patter�

of racketeering activity or the collection of an

unlawful debt. In a pervasive scheme of criminal

activity it is not uncommon to find both kinds of

activity. If both are pfesent, we suggest both

be charged to give your case greater latitude and

strength.

PATTERN OF R�CKETEERING ACTIVITY

To prove a pattern of rackcteerin& activity

requires proof of at least two of the substar.tive

crimes set !orth in Section 1961. It should be

carefully noted that there must be affirmative

proof of a nexus or relationship between the acts

5

rnckctccrinr;. Or cour�1et jf the-3UU3tant1vc nct;3

or·rnckr.tc�ring rcqulrP proof of nn effect on

111 t el' s t n t C CO IT'Jn Cl' C e ( C • g . 1 0 u . s . C . 19 51 ) , 1 t

must be demonstrated and established.

To recapitulate briefly, Section 1962(a)

outlaws the derivation of income from a nattcrn

of racketeering activity which is used to actjulre

an enterprise. Section 1962(b) outlaws the

acquisition or maintenance of' any ---interest in or

control of any enterprise through a pattern of

rncketeerinG activity. Section 1962(c) outlaws

the conduct of the affairs of any enterprise through

a pattern of racketeering activity.

COLLECTimr OF AN UNLAWFUL DEBT

The alternative method of proving a violatio�

of Sections 1962(a), (b) or (c) is by the establish­

ment of the collection of an unlawful debt. .£._nly

one collection is necessary to make out a violation,

The�e are two ways to p�cve the collection of an

unlawful debt. The circumstances are narrow but

are peculiu�ly des�gned to co�bat corr�on methods

of organized criminal activity.

8

(13)

(1�) (15)

(16)

(17)

(18)

· (19)(20)

SccU on 1951 {Interference with Commerce Hobher:,· or Extortion)

Section 19'..>2 (IT/1H) Scctio� 19S3 (IT Wnccr1ng

Pnrnphcrnnlin) Section 1951� (Unlnwful Wclfnrc

· Fund Pn:11mcnts)Section 1955 (Prohibition of

Illegal Gamblinc Bu�iness) Section 231� (Intcr�t�te -.

Transportation of Stolen Property)

Section 23]5 {Sule of Stolen Goods) Sections 2�21, 2�22, 2�23, 2�2�

{White Slave Traffic)

c. Violations of 29 U.S.C. -

(1) Section 186 (Restrictions onPayments and Loans to Labor Organizations)

(2) Section 5Dl{c) (Embezzlementfrom Union Funds)

d .. Bankruptcy Fr·nud (1nclud1nE; frnud in sale of sccuriti�s)

c. Felonious

(1) Manufacture(2) Importation(3) Receiving(�) Concealment (5) Buying

(6) Selling(7) Dealing

) )

) Narcotic ) or

) Dangerous Drug ) )

Any �Ombinat�on of the above listed crimes

can form a pattern of racketeering activity.

· Remember the statute only requires that the ,

· • "ente!'pr!se II engage ir. or have: acti v1t!es whicb

affect interstate or fore1gr. commerce. ?herefcre,

it is possible to have a pattern of state acts of

7

. HEHmTES

Section 19G3 of Title 18, United Stater,

Code, provides interlocutory relief and substantial

criminal penalties for violating Sections 1962(n),

(b� (c) or (d). Section.196� of Title 10, United

States Code, provides for effective civil causes

of action and appropriate remedies which can

be sought by the United States and any person

aggrieved by a violation of Sections 1962(a), (b),

(c) and (d).

At the time of an indictment charging a vio­

lation of Section 1962, the United States may

move_pursuant to Sectior. 1963(b) for a restraining

order or prohibition or other device, including a

·request for a performance bond, to protect nny

property interest subject to forfeiture under

Section 1963(a). This means that if you intend

to seek forfeiture of the enterprise and other

property interests used in the commission of a

Section 1962 violation, you can and should move

tE_12rotcc t that property i nter2 st from l :1 Qli j □at j on

,_ and disoosa). dl!ring the pencency o!' the criminal

proceed!ng. The Federal Rules of Cr!minal Procedure

require the inclusion of ar. allegatior. in the

10

The f'ir::;t method requires:

(a) a gambling busin��s illegal

under federal, state or local

law;

....--

_(b) A debt.incurred or contracted in V

gambling activity;

( c) collection of that debt. V

The second method requires:

(a) a debt incurred in connection

with the business of lending

money;

(b) which debt is unenforc�able in

whole or part because of �ederal

or state usury laws {the usurious

rate of interest is double the

(c)

legal rate o.f interest under state

or redcral law)

the collection of the debt.

It is clear that the first method permits

a new attack on the illegal gambling business and

with the new remedies will permit the forfeiture

· of the legitimate �ror.t usec tc �ovc� the illegal

activity. The second �ethod descr1bed is designed

to attack the loanshark where there is an absence

✓

of proof of violence !n the collection of the debt.

9

with the provisions of th� sub:;cctlon.

CIVIL rmMEDIES OF 'J'IIE UNITED S'J'ATES

Scttion 19G4(a) of Title 18, United States

Code, grants the District Courts power to hear

civil actions by the United States to:

_(l) divest a person of any interest

in an enterprise,

(2) restrain future activities or

investments of nny persons,

(3) dissolve or reorganize any

enterprise subject to the.

rights of innocent persons.

Section 1964(b) authorizes the Attorney General

. to.institute civil proceedings and directs the

Courts to expedite such matters.

Section 1964(b) also provides for interlocutory

restraining orders and prohibitions and the accept­

ance of performance bonds pending the final dis­

position of the civil proceeding.

A preceding criminal act1on 1s oat a prerequisite

to •the institutio� of a civil &ctio�. However >

careful consideration should be first given to this

initial civil filing in order to protect informants

12

indictment spcclfyine; the property intcrcnt8 to be

forfeited. The purpo�c of this nllcgntion io to

nppr13c thC' nccuncd (in nccordnncc with the utnndnrdn

of due process) that he standn to lo3c his property

interests which arc utilized in violation of

Section 1962.

CRIMIN/\J, PE?J/\L'rIES

Section 1963(a) provides for the imposition

of a maximum term of imprisonment of twenty years

and a fine of $25,000 for each violation of Sec-

tion 1962. In addition 1963(a) provides that

the accused:

shall forfeit to the United States {l) any interest he has acquired or maintained in violation of Section 1962, an<l (2) any interest in, security of, claim aGainst, or property or contractual right of any kind affordinG a source of influence over, any enterprise which he has established, operated, controlled, conducted, or partici­pated in the conduct of, in violation of Section 1962.

Any forfeiture is subject. of course, to the rights

of innocent persons. Once the property interests

of the accusee are forfeited, Section 1963(c) grants

the Court the power to authorize the Attorney General

to seize the forfeited property or interest and

dispose of the same in accordance with the·

11

J>HOSEClJTIOl·J;_; 1

INDIC'fi'11 il'1'0 /\ND IIWl��;'J'JO J\'l'ION[;

The following recitation is an account of

the invcsti6ntivc agencies, the Organized Crime

and Racketeering Section and the offices of

the United States �ttorneys.

CONVICTIONS

United States v. Parncr.s, (SONY)

On.October 4, 1973, Milton Parness was convicted

under Section 1962(b) of defrauding Allan Goberman

of his 90,5 percent stock interest in a mul�i-million

dollar hotel and casino in the Netherlands Antilles.

Parness was als6 found guilty under three counts

of Section 231�, which were incorporRted in the

·.section 1962(b) charge as acts of racketeering

activity. He was sentenced to 10 years i�prison­

ment and a total of $55,000 in fines. His wife,

Barbara, was also convicted on three counts of

Section 231� and sentenced to twc years suspended,

three years probation, and a total of $6,000 in

fines. An appeal is pending before the United

States Ccurt of Appeals for the SeconG Circuit.

[Strike Force 18 and the United States Attorney's

office # Southcrr. District of New Yo�k.J

who could be rcnchcd l>y discovery under the

Federal Rules of Civil Procedure.

In the event a civil action is filed subsequent

to a conviction in a criminal procccdinG, Section

19G4(d) provides for the assertion of the doctrine

of collateral estoppcl by the United Stntes in

the civil proceeding. We do not recomm�nd the

simultaneous filing of an indictment and a 1964

civil action. The discovery tools provided in

a civil action could jeopardize your criminal

case prior to trial.

CIVIL REMEDIES OF VIC'I'IMS

Section 1964{c) of �itle 18, United States

Code, provides a civil cause of action fbr treble

damages by any person injured in his business or

property by reason of a violation of Section 1962.

The victim may also recover the cost of the suit

including a reasonable attorney 1 s fee.

A word of caution is necessary in advising a

potential victim-witness of this remedy prior to

.hi .... .._; ., ..., t .... -< .. • s ..,es ... ..:.n;ony _-L•• � ..... a.J... A witness mot�vated by a

desi�e to recove� his losses under this provision

is subject to impeachment on cross-examination

�o� bins or prejudice.

13

i•acl�ctccrinr; actlv·ity cor·.:;.1:;tcd of multiple countn

of Tltlc 10, United States Code, Section 1951,

nnd Tltlc ?.9, United Stat.,c:1 Coclc, .Section 18.G(b)

violations. Sentence:;. of from ll to 5 year:; were

imposed on the principal defendants. An appeal is

pending before the United States Court of Appeals

for the Ninth Circuit. [Los Angeles Strike Force]

ACQUITTALS

United States v. Bufalino, et. al., (vIDUY)

Russell Dufalino and_ 15 other defendants were

acquitted on charges of Title 18, Unifed States

Code, Section 1951 (Hobbs Act) and Section 1962(b),

. (c) and (d) violations in a multi-count indictment

brouGht by the Buffalo Strike Force. The 1ndict­

ment �esulted from the detendants t extensive

racketeering activity directed against legitir:;nte­

compet-itors in the· vending machine busin2ss in

New York State. (Buffalo Strike Poree]

PENDING INDICTMENTS

United St�t�� v. Ricciardi ) et. al. (D. N.J.)

A thirte_er.-count :!..ndictt...e-u.t brought by the

Newark Strike Force charges three defendants with

16

Un j t c rl St a Le ;, v • St o f;, I� c ( . al • , ( SD NY )

George Stofsky, the Chief Exccutlvc

Officer of the Furricro Joint Council, nnd scvernl

ot.hcr union officials nnd fur manufac t urcrs

were convicted under a multi-count indictment

charging ·the union officials with receiving large

pay-offs from the manufacturers, in violatlon

of Title 29, United States Code, Section.i 186(a)

and (b), Title 18, United States Code, Section

1951 and Title 18, United States Code, Sections

1962(c) and (d). The defendants received

sentences and fines ranc;ing fro_m two t 6 three

years and from $2,000 to $13, ooo.

[Joint Strike Force and United States Attorney's

office, Southern District of New York.]

United States v. Campanale, et. al., (CD .Cal.)

United States v. Grancich, ct. al., (CE Cal.)

Four Teamster officials and two former owners

of the Pronto Loading and Unloading Company of

Los Angeles were convicted in March 1973, of con­

.. sp1racy under Section l962(d) arising out of the

1nt1micat1on and extortion of money from meat

packers end Pronto �ompetitors. The pattern of

15

Uni tccl Stn tc0 v. Daly, ( E:"> Mo.)

A nine-count indictment charc;ine; violations

of Title 18, United States Code, Sectioi1s 1962(c),

1343 and 19G2(d) was returned a�ainst Anthony Virgil

Dnly on April 25, 1974, Seven other individuals

-were charged in the Section 1962(d) conspiracy;

they were alleged to be individuals associated

in fact to use the telephones of Daly's construction

company to defraud major oil companies and credit

card holders. The scheme is believed to have netted

the defendants over one million dollars in cash

and merchandise. [Strike Force 18 and St. Louis

Strike Force]

United States v. Lewin (N.D. Ill.)

An indictment was filed against a major jewelry

fence in Chicac;o who committed violatio·ns of

Title 18, United States Code, Section 23l5, by

conducting the affairs of his large wholesale

jewelry business through a pattern of racketeering

activity. Forfeiture of the jewelry business and

other property interests will be sought. [Chicago

Strike Force]

United States v. Ackerman, et. al., (N.D. Ill.)

An indictment was filed against harness drivers

18

violatlnr; TJtlc 10, Un.:tcd Statco Code, Section

19G�(b), through the collection of an unlawful

debt arising out of lonn�hnrking opcrntiono.

[ Newark Str ikc Force l

Unltcd States v. Tolkow, (EDNY)

Bernard Tolkow, Secretary�Treasurer and Union

Trustee of n Union Welfare Fund, is charged with

violations of Title 18, United States Code,

Sections 1027, 1951� and 1962(c) in a multi-count

indictment alleging that he received kickbacks

from union employers. [Brooklyn Strike Force]

United States v. Abondolo, et. al., (SDNY)

Three officials of the Amalgamated Meat Cutters

and Retail Food Store Employees Union are charsed

in a multi-count indictment with violatio;is of

Title 18, United States Code, Sections 1962(c) and

(d) and Title 29, United States Code, Section 186(b).

The indictment charges that the three defendants

demanded and received fro� executives of a large

food store chain $18,000 in 1968, $24,000 in 1969

and $-2� � 000 in 1970, all for "labor peace." In

addition 13 executives o� New York area supermarket

chains were indicted or. income tax evasion chnr�es

arising out of kickbacks they rece!ved from meat

suppliers. [Joint Strike Force - SONY)

17

J'HOPOSl·:n .I Nl.>JC'J'Ml�N'l'r,

Unit0.cl Stater. v. Rich:ird:;, ct, al., (N.D-. IllJ)

On March 15, 1974, warrants were issued for

the arrest of four person� in connection with a

series of thr�ats and beatings administered to

persons associated with Thunderbird Truckinr; and

Warehouse, Inc. The compla:lnt supportinr; the

�arrant alleged violations of Scctjons 1962(c)

and (d), with state robbery and Hobbs Act violations

as the acts of racketeering. [Chicago Strike

Force]

United States v. Bert, ct. al., (E.D. Mich.)

Ten defendants may be charged in a multi­

count RICO indictment with operation of an illegal

drug laboratory and distributing nurcotics in

�cvcral states, in violation of Title 18, United

States Code, Sections 1962(c) and (d) and Title 21,

United States Code, Sections 841 and 846. The

Government may sciek to forfeit all interests in

the illegal laboratory and the premises where it

is located uncc� the :ri�ir.al forfeiture provisions

of Section l963. [Detroit Strixe Force]

20

and owners of race horGcs who fixed rncco at th1·cc

different trnclcs in ChicaE;o. The puttc:·n of rnck­

ctcering activity connints of multiple countn of

Title 18, United States Code, Section 224 (sportr.

bribery), as part of multiple counts of Title 18,

United States Code, Section 1962(c). Forfeiture

of the horses and other property interests utilized

in the 1962(c) violation is sought. [Chicago

Strike Force]

United States v. Scalzitti, et. al,, (W.D. Pa.)

An indictment has been filed agai�st several

organized crime figures who have perpetrated a

double financing scheme for automobile loans from

Pennsylvania banks through the affairs of a Cadillac­

Oldsmobile dealership. They are charged with a

Section 1962(d) conspiracy to violate Section 1962(c)

and a substantive Section 1962(c) count of committing

a pattern of mail fraud violations through the conduct

·or the affairs of the dealership. They would, in

effect, sell the c&rs twice. It is believed the

.borr6wed money was used for loansharking activity.

[Pittsburgh St�ike Force]

19

the·corporation::; in viol.:ition of Section 19G2(b).

Forfeiture of the::;c controlling 0tock in1".crcstD

will be soueht. [Los AnGelcs Strike Force]

United St<ltcs v. Northrop Swan0on (D. Nev.)

A Section 1962(c) case will be brought asain�t

the owners of a licensed bbok in Reno f'or usjnp; an

enterprise to commit multiple violation::; of Title lD,

United States Code, Section 1084. This is the

largest licensed book in Nevada. [Los Angeles

Strike Force]

CURRENT RICO IJ'JVESTIGATIONS

Yeldon, et. al.

BOSTON STRIKE FORCE

A massive mortgaGe bust-out sch�me involving

Hobbs Act, Section 2314, mail and wire fraud

violations is currently under 1nvcsti�at1on. It

is expected to be indicted under Title 18, United

Sta tcs Code, Sectiom 1962 (b) and { c).

• BROOKLYN STRIKE FORCE

.Arion Loun5e

A joint New York State and Federal Strike

Force investigation indicates that the Arion Lounge,

22

United 01:alcs v. Milano, ct. al., (c·.o. Cal.)

A multi-count nrco indictment will be r;oue;ht

charc;ing a Title 18, United States Code, Section

1962(d) conspiracy to violate Section 1�62(c)

against. several top LCN ficuros in the Licata

family in California. The pattern of racketeering

activity consists of multiple violations of

Title 18, United States Code, Sections 1951, 2314,

the California extortion statute and the collection

of unlawful debts. The enterprise 1s a group of

individuals associated in fact for the purpose of

shaking down local books, pornographic ·bookshop

owners and shylocks. [Los Angeles Strike Force]

United States v. Sarno, et. al., (D. Nev.)

The owners of 70 percent of the stock of the

Circus Circus Hotel and Casino and the owners of

National Car Corporation have been indicted under

Title 18, United States Code, Sectiori 201, for

bribery of two Internal Revenue agents to subvert

and halt a major investigation of individual and

corporate tax liability. A superseding indictment

w!ll be souGht charg�ng 2 �ribery pattern of rack­

eteering acit!vty to maintair. stock interests in

21

w:ir. cxccutc<.1 on /\pril 17, 19711, nnd over !,30,000

worth of r.tolc11 jewelry Wc'.10 recovered. The warrnnt

was the result of a T1tle III placed on Lewin's

place of business, Universal Gem and Jewelry Company.

Lewin is a long time fence for· LCN �igurcs in

Chica&o, A Section 1962(c) indictment utilizing

Scctio11 2315 to make up the acts of rnck,�lecring

will be broucht.

Vernor� Richards (Thunderbird Truc:<ing), et. al.

On March 15, 1974, warrants were issued �or

the arrest of four persons in connection with a

series of threats and beatinGs administered to

persons associated with Thunderbird Trucking and

Warehouse, Inc. The complaint supporting the

warrant allcc;ed violatior,s of Sections 1962(c)

and_ (d), with state robbery and Hobbs Act violations

as the nets of racketeering.

CLEVELAND STRIKE FORCE

Land Fraud

A massive :.:-eal estate !'raud scheme involving

major Cleveland LCN members is currently being

investigated. In at least 26 cases in seven

,opc1·11 Led lJy Sy 1 VC!, ter mid J.,conard Bruno, 1.ueml>l'r:1

of the Evoln LCN family� 1s bcinr; u:;cd D.!:i the base

of a large scale shylockini op2ration.

A & I Trucking Company

Paul Castellano.and other significant LCN

figures have been usine the trucking company as

a front for a huge loansharJcing operation. A

Section 1962(c) case with ECT acts of racketeering

is contemplated. Investigation of this case also

led to the discovery that an officer of �he

Bankers. Trust Company was making larg-e _unsecured

loans to LCN r.1emb·ers and rout:inely writing them off

as bad debts.

CHICAGO STRI1rn FORCE

Internal P.evenue Se�vice Stolen Car Proiect

The Chicago Strike Force and the �nternal

Revenue Service have uncovered a large 1nt£rstate

operation involving the .fencing of auto parts

stripped from stolen cars. Section 231�, 2315

and 196�(c) counts a:-e anticipated�

Adolnh Lewin Fence

.An arrest warrant .fo:- Lew.in ,, a majo:" .fcnc-e,

23

S f< C. Dj nc-r, H1sl1J;i.nd Pnrk, i'UcJ1j t;-in

The S & C Diner hns been "sold 11 i"or $50 ., 000

to Detroit LCN a::;sociates Dominic Joseph Bomrnarit-o

and Quazim 1'J'immy 11 Balibashi. A rel1ab1€ source

reported that the prior m·mer o:r the diner, .Jerry

Dean Clements, had incurred a $50,DDO Earnbling debt

which is currently held by Detroit LCN Capo Dominic

Peter Corrado.

Corrado alleg-edly directed Bommarito and

Bal1bnshi to take legal control oi' the restaurant

and real estate to satisfy the gambling debt.

According to an inside source ., Corrado ·demanded in

. no uncertain terms that Clements turn over the

enterprise to his boys.

Knollwood JJiemorial Park Cer.1eterv A.ssocjation� Inco:rr.)Or·atcd

This company was :formed in 195B 3 by Sam Tocco 3

a suspected member o:r the Detroit LCN fai�ily 3 and

Gerald M. Franklin.,

a local attorney with Jmmm

Cl'iminal connections. In March 197-4 3 FranJrli:n was

killed in gangland-style f'ashion. This :murder is

still unsolved.

Invcst!gatio:J has ::-cv2�led that ·Tocco is .!nv.olv2c.

in nurner.:>us q-uest1ona!:>l€ bus:!...tess p::-acti::es.

26

_Jurl�dlction�, land owner:; have been approached

by phony renl c:Jtntc �alcsmcn who offered to 11:Jt

their property nationwide in return ·ror a fee

of $200. Upon payment, the "salesmen" disappeared

and were never heard fr6m again. Mail fraud and

RICO counts are planned.

DETROIT STRIKE FORCE

Dominic Joseoh Licavoli, ·et. al.

A Title III inte.:--ccpt.io;-: 1-:0 s utilized in this

investigation of an $18,000 bribe paid to a

Washington, D.C., Small Business Administration

official by a Cleveland contractor to enable the

contractor to Get a large performance bond .

Bribery and RICO charges will be brouGht against

Licavoli (the middle man in the bribe scheme),

the Cleveland contractor, and the Small Business

Administration official.

Giacalone, et. al.

The Detroit Strike Force 1s conducting an

investigation into a scheme to defraud shareholders

o!' a medical insll!"c:.nce co:npany by p·aymcnts of

"consulting fees" to a majo� LCN figure. Mail

fraud and RICO counts are b2ing considered.

25

w}d ch .1::; parent corpor3 tion for r1ne J<nob Proper\; 1cn

(a M1ch1gon nk1 und thc�tcr complex- vnlucd nt

$�. � m1111 on) and an as::;ortmcnt of 1.11111 tcc..1 purtncr­

sh1 p commercial and industrial dcv�lopmcnt companies.

Principals ari Joseph J. Locricchio (related to

Sam Locricchio - Detroit LCN associate) an� Gary

Francell. Investigation has been initiated over

a $200,000 loan to Indusco principals in July 1972,

from a Troy, Michiean, businessman; the money was

"washed" through a Toronto, C.:rnada, investment broker.

The investit;ation was predicated on numerous alleE;ation!i

stating that "racketeer money" was invested in

Indusco, causing it to blossom into current fiscal

value from an original investment by the principals

in 1968 of $9,000.

Grapevine Lounge; Lnrry Glover Carter

Investigation in this matter concerns the

attempted purchase of the Grapevine Lounge 1 a

Detroit bar, by Larry Glover Carter, a major

Detroit narcotics dealer. The investigation has

disclosed that in March 1973, Carter obtained an

option to purchase the lounge for $7,000. It

appears that Ca�ter has not hac legitimate employment

28

Information has currently been ckvclopcd wh1 ch

indicate::; that Smn Tocco has borrowed jn exec:;:;

or $300,000 for Knollwood Cemetery from varjoun

banks j including the Trenton State Bank, in which

he 1s alleged to be a major stockholder. Information

also indicates that Tocco used the loan proceedr,

for purposes other than those stated to.the bank.

Joshua Doore Furniture Company I

On March 17, 197�, Harvey L. Leach, Chairman

of the Board of the JoslYua Doore Furniture Company

was killed by Organized Crime figur,=s in Detroit. ·.

Furt"her informatio]'.1 indicated that Leach and his

partner, Spencer Reuben, had borrowed money f'rorr.

a loanshark to acquire their stock 1n the furniture

bu�d llC'!'.S.

Investigation has determined that Fred Gordon,

a Detroit attorney a11d .financier ., arranged loans

which totaled approximately $3,500,000 ror the

financing of three .Joshua Doore Furniture warehouses.

The $3,500,000 in financing was obtained through

Joseph Burnett of C.N.Ji.. Financial Limited ., an

• investment �ompany located in Toronto� Canada.

Indusco, Inc., DetroitJ Michican

This case concerns a :Det:J:'oit area :eorporat:1.on

27

'!'his company has been opcrnted by variour.

Detroit raclcetccr:::;, includine; Harrison "Chink"

Bro,m, Wi111am Wimbley, and Claude Brown, since

the late 1960 1 s. Investigation has revealed that

the business has bee� and continues to be used as

a lcc;itimate "front" for a larr;e scale numbers

gambling operation headed by Harrison "Chin!<" I3rown.

Local police and Internal Rev�nue Service sources

estimate this gambling operation has a gross daily

business in excess of $20,000.

Harry Virgil Mohney, d/b/a Mohney Enterprises; American Amusement Company; American Massage Parlors, Inc.; Screen News; Durand, MichiBan

Harry VirGil Mohney began his operation in

1965 with a beginning captial of $7,000, operating

drive-in theatres at Durand and Lapeer, Michigan.

He subsequently expanded his operation to include

numerous boo�stores specializing in pornography,

·movie theatres showin� only double X-rated films,

pornography magazines, and massage parlors which

are fronts for prostitution. These activities

··have sp:::-ead .trom Dt.:rand to every maj o:- :i ty in

Michigan, to major cities th�ough the Midwest and

30

.

:.;incc 19'/ 1 and that his money co men from the

narcotics business.

Ames Investment Company, James Couzens, Detroit, Michic:;an

Ames Investment Company is a "front" business

set up by a "Bud" Johnson, 18�10 Marlowe, Detroit,

to conceal his actual occupation as a leading heroin

dealer in the Detroit area. Doth the Internal

Revenue Service and United States Customs Service

are conducting in-depth investigations of William

"Bud" Johnson and his narcotics partner, Johnny

Oliver Black. Both Johnson and Black have extensive

�rior criminal records, including local and Federal

convictions for violation of narcotics laws.

It has been determined that; the Black-Johnson

group gets drugs from a supplier in New York, who

ships them through Canada. Ames is being used as

a front for the .narcotics operations; and monies

from the narcotics activity are being funneled through

the company as well as a newly-formed real estate

venture set up by Johnson and Black. Money is then

used to buy vacant inner city houses for renovation

and resale at an exaggerated profit.

29

thrcat0 and violence. Hobbs /\ct and HICO

inclictmcnts arc be inc; com;iclcrcd.

Peter John Milano, ct. al.

A RICO case against five top LoG AnGelcs LCN

members arining out of the shakedown of small

i

books, porno shops and shy-locks is being prepared.

Jay Sarno, et. al. , (D. Nev.)

This case involves the largest bribe ever

offered to an Internal Revenue Service aeent. The

controlling shareholders of Circus Circus and

National Car Corporation offered the agent $6�,000

to subvert and halt the investigation of corporate

and individual returns. Evidence of the bribes

and. threats were consensually recorded by the agent,

who reported the attemp� to his superiors from the

beginning.

Northrop Swanson, et. al., (D. Nev.)

A RICO investigation of the owners of the

largest licensed book in Nevada is currently

unce::way. Multiple violatior.s of 108� will serve

as tr.e nets or racketeering activity in a 1962(c)

indictment.

32

South and, on a limited ucnlc, through the

Northeast and far West.

The Mohney operation engages in a considerable

amount of interstate transportation of obscene

materials and girls between the various stores and/

or parlors via privately owned cars and trucks,

rental vehicles, common carriers, and private and

commerical airlines. This case may be charged

as a Section 1962(c) violation.

LOS ANGELES STRIKE FORCE

Joseph H3uscr, et. al.

Joseph Hauser, who had a one year contract to

solicit union membership for a pre-paid medical

insurance plan, is alleged to have offered pay-offs

to union officials to get them to accept the plan.

An investigation into possible violations of Title 16,

United States Code, Sections 195�, 1962(c) and (d)

1s continuing.

Lconnrd M. Ross, et. al.

• The subject ar.d othe� LCN-connected persons are

allcbed to have acquired a million dollars plus

1nte�est in the International Monetary Fund through

31

Edw;iPd I.ubrnno

Lubrano, a New Jersey pJ.umbini:; contractor .and

fllabor consultant", has shaken down several major

home builders, including Boise Cascade and Levitt

Bros .. , :for appro.ximately $200,000 wit.h threats o.f

labor .and other trouble if hi.s consulting .services

ar-e not utilized.. Lubrano is -worJdng :for Tony Grande,

an _enforcer f'or the Gambino f'amil,y. Books of

Lubrano and Boise Cascade have been subpoenaed and

testimony concerning the case has been presented

to 'the F-ederal Grand Jur_y in .Newark. Hobb.s .Act

and RICO counts are anticipated .•

Pakco Con;panies, Inc.

An inv-estigation i.s underway to determine ii'

Pakco is being used to }allJ)de::- LCN money or to

engage in LC.N investr.wnt .schemes.. .Several major

LCN :figures bave ·been clo:s-el,Y a.s.sociated �<1ith

PaJtco '' s .op-eration in t.be pa.st ..

:Jay Ma-rtir. Weissman., et .. al ..

P. RICO indictment with Section 2311J :eount.s

as the acts ni' r.&c.ketce:::-inb will be b.rought

a.g.a1nst Wc.1ss.�,, D:wner ol' .a je�'l.elry store and a

'l'hc Los flneclct; Strll<c F'o1·cc hnn 1·cceivccl

information from California State -invcstic;ativc

agencies linking Louis Visco, a top associate of

Los Angeles LCN boss Nick Licata, with several

waste disposai companies in southern California.

Vicso-controllcd companies are alleged to have

acquired several competitors through sabo�agc,

threats, violence and bribery of public officials.

Visco has boasted that his goal is to control

waste disposal throughout the country, and the

state report indicAtes that mob-infiltrated com­

panies have already spread throughout California

and the Southwest.

NEWARK STRIKE FORCE

'l'rade Union Ne1·1s

This investigation concerns telephone threats

made by company advertising solicitors to local

businesses to induce them to take ads in a union

newspaper. A RICO case will be brought if Hobbs

• Act counts can be made against the owners of the

company.

33

State ?olice and the Strike Force into po3sible

illcr;al activitien by John Dwyer, Larry D_iLorenzo

and Gilbert Wallach iri connection with the subject

vending machine company has recently been.initiated .

Master Truckmen's Association

A large-scale invcsti�ation is currently in

progress to determine the extent of LCN infiltra­

tion into the New York City garment district,

including truckers and manufacturers.

PITTSBURGH STRIKE FORCE

Frank Joseph Rosa

From late 1971 through 1973 top-echelon LCN

figures have been extensively involved in take­

overs of lebitimate businesses in the Pittsburgh

area. Acquisitions include,a motel, an auto

dealership and a trucking company. Loans for

the transactions have come largely from one bank

·and all have been approved. by the same loan officer,

who allegedly received large kickbacks fo� his

serv19cs. Also, there 2�e allegations of payoffs

made to Gcne�al Motors officials to get auto

dealerships) and of other illegalities. Intensive

36

mnJ or f�ncc 111 TJ'nmpn, FlnrJda, ;r:i:nd i;.wo ·o:f ,h1.:1

SUJ)J>liers of s tolcn propcrt.Y .. �'he .tra1rnilct1on cvver·cd

in the indictment involved good.r; v:al-.ued :at ·ov-er

$50,000 retail .

.NEW ORLEANS .S7RIKE FORCE

�•crash Landinr:;11 Club

Big.h-2chelon LCN member G.arlo.s Marcello and

Sanirn_y Labruzzo are involved in the att-e.mpned

takeov-er o.f a night club in Ne·,.., Orleans.. .A

Section 1962(d) conspiracy to viol.at-e .Section l9£2(b')

c.har.g-e, ;w1 th Hobbs Act violations a.s the .act:s of'

racJr-et-eering, i.s being consid-e:r2.d ..

NEW YORK JOINT STRIKE FGRCE

Columbia Asnhalt Corn.

An :investigation is -unde:r:i.-rny into pos:s.'.tble

k:i�kback:s .and othe:r i:rr-es·ul:a:ri"ti-es invol vin_g

the New York Department of' :Highways and .Bev-e:ral

asphalt companies ..

• Fort }1ontp:omcry Vendinr; Co .. , R-o.clr1cmd Co!:mt-v; New York

lnvi!st!gation,j J:nt-e:rnal ReY�n.u•e :Se::--v:i.ce" New Y.or.k

35

· Philudclphiu by 01•gunizcd crime fj_gurcn. The ouccenn

of the opcrntion depends upon the bribery_ of nr,cntn

and other Pennsylvania officials.

Theft and Sale of Gasoline

A massive theft of gasoline fro� a major

refinery outside Philadephia has been uncovered.

The gasoline is placed in loading tanks and then

in trucks which await directions to deliver in a

tri-state area. On weekends the trucks are

appropriated by organized crime elements nnd the

gasoline is unloaded at various friendly service

stations in Philadelphia. The trucks are then

returned to the refinery. It is estimated that

35,000 - 6�,000 gallons of gasoline have been stolen

each weekend for several years. The gas6line is

distributed to the stations for 15 cents per gallon

and sold by the stations at the current inflated

rate.

UNITED S7ATES ATTORNEY'S OFFICE -M/\CON GEORGI/\

� majo� investigation is underway into the

sale of pinball machines, numbers operatio�s�

prostitution, and police and official corruption

38

i11ve:,Ligntion is con\l11uinr,. Violnti0nn of

'l'itle 18, United States Code, Sectiom213, 101 11, 1955

and 1962 are indicated.

UNITED STATES ATTORNEY'S OFFICE

Maurice Edward Olen, et. al.

Olen, the "whiz kid of marketing"

PITTSDURGII

in the 50's

who has done time for securities fraud, is alleged

to be running a massive bankruptcy bust-out s�heme

involving several clothing stores in the Pittsburgh

area and several other large cities.

SAN FRANCISCO STRIKE FORCE

Opc1·.ttinG Enc;incers Local No. 3

Allegations have been received by the Federal

Bureau of Investigation ·that Local ff3 has been

conducting its affairs through threats, assaults

and murder of Union members and contractors,

and destruction of contractors' equipment.

PHILADELPHIA S'l'RIKE FORCE

• Cierette Smusgling

An investication is underway into the smuggling

of untaxed cigrettes from North Carolina to South

37

u·ni tea' States v. G{:orr;c Stof;,ky, ct. a1, , ( SDNY)

This action seeks to permanently enjoin the

defendants ., union officials of the Furriers

Joint Council > from hereafter participating in

any trade union or labor orGanization. Stofsky

and zevcrnl othe::r· union off1c1als were recently

convicted on criminal RICO charges for receiving

larf;e pa:y-offs fro.;n .fur manufacturers.

United .Stat.es v. Lad.-rner ., -e-:.. E.l,., {EDNY)

This action alleges that the six defendants,

officials of the International Production Service

and Sales Employee Union ., embezzled union and

�elfarr:: .2.nc. pension :'ur.ds in violation of Title 29,

United S�ates Cede ., Section 5Dl(c) ., Title 18,

United States �ode ., Section �6� BDd Title 18, United

States Code ., Section 1962(c) ., �nd seeks to per­

manently eJ1Joln -each rdeferidant i'rom all further

union activities�

ll(U-f11"7l---03

in the city of Mo.con, Gcorcio.. Violations of

Section 1962(c) are expected to be filed describing

n large scale pattern of racketecrin� and

corruption.

SECTION 1964 CIVIL �CTIONS

United States v. Cappetto (N.D. Ill.)

This is a civil action recently brought by

the United States Attorney's office in Chicago

and the Chicago Strike Force under Section 1964(b)

to enjoin the eight defendants from engaging in an

1llecal gambling business in violation of Title 18»

UnjtL�d States Code, Sections 1955;0

1962(b), (c)

and (d). The District Court has granted the

relief sought. The case is on appeal.

United States v. Parness; (SDNY)

This is a Section 1964(b) case directing

Milton Parness, convicted in December 1973, of

violating the criminal provisions of Section 1962(b),

to divest himself of all interests and investments

in any gambling junket enterprise ) and to restrain

him from any future junket activity in further

violation of Section 1962(b).

39

' .... ___ ......, "m-. ...... _. • ..,."" -�,. , ..... 1