This chapter discusses organized crime's involvement in various illegal goods and services markets globally, including gambling, loansharking, fencing, commercial sex, human trafficking, arms trafficking, and counterfeit goods. It describes how organized crime groups have dominated and profited from illegal gambling operations like bookmaking, lotteries and casinos both historically and in the modern era online. The chapter also examines organized crime's role in other illicit businesses like cybercrime, money laundering, and providing goods and services that are illegal but in high demand.

1. CHAPTER THIRTEEN
Organized Crime in Labor, Business,
and Money Laundering
Abadinsky, Organized Crime 10th ed.
In 1957, Albert Anastasia, boss of the Gambino Family
and unofficial ruler of the Brooklyn waterfront, was
murdered in a barber's chair at a New York hotel. His
brother, ("Tough") Tony Anastasio, a member of the
Gambino Family and official ruler of the Brooklyn
waterfront, remained head of International
Longshoremen's Local 1814 in Red Hook, Brooklyn, until
his natural death in 1963.
This chapter discusses the four international unions
connected to OC.
2
LABOR RACKETEERING
personal benefit by illegal, violent, and fraudulent
means.
ackets assume 3 basic forms:

2. 3
ORGANIZED LABOR IN AMERICA
abor wars.
and engage in collective bargaining.
4
LABOR RACKETEERING:
IN THE BEGINNING…
the ranks of their membership to deal with
management Pinkerton agents and strikebreakers.

3. practices.
Jewish labor movement.
management goons.
5
LEPKE BUCHALTER
-arm for labor-industrial racketeers.
trucking industries.
6
LABOR RACKETEERING AND THE BIG FOUR
between the AFL and the CIO, both sides resorted to

4. muscle from organized crime.
ionals were delivered
into the hands of organized crime.
(LIUNA, HEREIU, ILA, IBT) are dominated by OC.
7
LABORERS’ INTERNATIONAL UNION
OF NORTH AMERICA (LIUNA)
DeCavalcante, discussing how control of Laborers’
Union locals enabled him to “shake down” building
contractors who wanted to avoid using expensive
union labor.
e OC members or
associates.
8
HOTEL EMPLOYEES AND RESTAURANT
EMPLOYEES INTERNATIONAL UNION (HEREIU)

5. have his place unionized upon the first visit of the
organizer.”
headed by Angelo Bruno.
buy supplies and provisions from companies they own.
9
INTERNATIONAL LONGSHOREMEN’S
ASSOCIATION (ILA)
movement of goods throughout the Eastern seaboard.
industry.
kickbacks from workers eager for a day’s wage.
10
WATERFRONT COMMISSION

6. ed that OC, using its control of the ILA,
“had for years been levying the equivalent of a 5 percent tax on
all general cargo moving in and out of the harbor.”
–New
Jersey Waterfront Commission.
from the docks.
-up.”
waterfront
unions.
firms to guard against illegal payoffs and other violations.
11
INTERNATIONAL BROTHERHOOD
OF TEAMSTERS (IBT)
domination of organized crime because virtually every
consumer product needs to be trucked.
workers, flight attendants, and other workers.

7. -haul truck
drivers, but now represents only about 8 percent.
12
JIMMY HOFFA, TONY PROVENZANO (“TONY PRO”),
JOHN DIOGUARDI AND ANTHONY CORALLO,
ALLEN DORFMAN, JACKIE PRESSER
racketeer. Others began as racketeers.
methods to gain high position in
the union, and used union funds for personal use.
when witnesses were murdered.
trusteeships by the government.
13
HOFFA VERSUS KENNEDY
Committee on Improper Activities in the Labor or
Management Field.

8. “Bob” or “Bobby” and as “nothing but a rich man’s kid.”
States and appointed his brother Robert attorney general.
Robert Kennedy made the Labor Racketeering Unit of the
Criminal Division his personal “Get Hoffa Squad.”
quently accused of trying to bribe jurors
and in 1964 was convicted of jury tampering and
sentenced to eight years’ imprisonment.
14
BUSINESS RACKETEERING
-and-fast line separating labor
racketeering from business racketeering—one is often
an integral part of the other.
“legitimate” businessmen have willingly cooperated in
order to derive benefits such as decreased labor costs,
inflated prices, or increased business in the market.
15
THE GARMENT CENTER
to Lepke Buchalter.

9. whoever controls trucking controls the industry.
-paced nature of the fashion industry cannot
countenance delays in shipping garments.
Carlo Gambino’s sons.
of trade violations and agreed to quit NYC’s garment
center and pay a fine of $12 million.
16
RESTRAINT OF TRADE
trade violations of the Sherman Act.
t-of-trade policing service.
otherwise legitimate businesses have illegal restraint
of trade agreements among themselves.
17
CONSTRUCTION INDUSTRY
tem of

10. collusive bidding.
officials and LCN family members, allocate jobs among
themselves and exclude non-cartel.
since the benefits of the cartel offset the increased
costs it imposes.
18
PRIVATE SOLID WASTE CARTING
cutthroat competition are tempted to pay gangsters
for protection against competitors.”
s until, with or without
help from OC, an association is formed.
or specific customers.
member’s business.
19
CRIMINALS IN A LEGITIMATE BUSINESS

11. 20
THE SCAM / BUST OUT
of various goods and sometimes insurance companies
up with that scheme as its purpose, or it may be an
established business that has fallen into OC control as
a result of gambling or loan shark debt.
21
STOCK FRAUD

12. transferred to a country with strict bank secrecy laws.
letter of credit, which is used to secure loans that are
then defaulted.
as collateral for bank loans from “cooperative”
loan officials or “rented” to legitimate businessmen
in need of collateral for instant credit.
22
MONEY LAUNDERING
-rich criminals have a problem: laundering their
illegal gains.
financial systems permit instant transfer of
millions of dollars through personal computers and
satellite dishes.
houses, stock brokerage houses, gold dealers, casinos,
automobile dealerships, insurance companies, and
trading companies.
23
CHAPTER ELEVEN

13. Organized Crime: “Goods And Services”
Gambling, Loansharking, Theft, Fencing,
Sex, Trafficking In Persons, Arms,
And Counterfeit Products
Abadinsky, Organized Crime 10th ed.
On a corner in New York's Chinatown, a woman
approaches the salesman. He takes a pamphlet from his
pocket and shows her pictures of Coach, Gucci, and
Louis Vuitton handbags. The woman asks a few
questions, points to her selection, and gives him cash.
He makes a cell phone call and soon another man
appears carrying a plastic bag. Inside is the handbag she
paid for—a counterfeit Gucci. The woman walks away
with her purchase, smiling.
In this chapter we examine the global market in a wide
range of illegal goods and services.
2
ORANIZED CRIME AND THE PROVIDERS OF
ILLEGAL GOODS AD SERVICES
3
goods and services that happen to be illegal.

14. sanctions does not provide for greater morality.
3 FORMS OF CONNECTION BETWEEN
ORGANIZED CRIME AND LEGAL BUSINESS
money from illegal entrepreneurs under a threat of
violence.
legitimate or illegal entrepreneurs to pay a fixed or
percentage amount but in return provide services, such as
restricting market entry, debt collection, and arbitration.
provides an illegal good such as drugs or a service, such as
enforcement of restraint of trade agreements.
4
“GOODS AND SERVICES” OR EXTORTION?
zed crime is extortion.

15. are victims of OC extortion.
5
“Those who
somehow
missed
Butch’s
silent
message
became
corpses.”
GAMBLING
and with the public.

16. -1995: Illegal betting increased tenfold (est.)
6
BOOKMAKING
1. Horse races and dog races.
2. Sporting events.
were set up in
the back of a legitimate business.
roving “handbook,” “runner,” or “sheetwriter” who
transmits the bet to the bookmaker.
frequently, often monthly, or they may use cell phones.
machine and leaves his or her number. The bookmaker returns
the call from a variety of locations, and the bet is placed.
7

17. SPORTS WAGERING
—the expected difference
between the favored team and the underdog.
hat
$11 is bet in order to win $10. Also called “juice.”
8
ORGANIZED CRIME AND BOOKMAKING
for
OC.
ndicate bookmakers.
—
estimated
gross $65 million, net 20 %.

18. computers were linked to an online service from Las Vegas
that provided the latest line on sporting events.
9
LOTTERIES
ully) to help finance the
Revolutionary War.
(now Brown), Columbia, Harvard, University of North
Carolina, William and Mary, and Yale.
d lotteries from using the mail.
the numbers business.
10
CASINO GAMBLING
AND RELATED ACTIVITIES
Nights.”

19. ction of organized crime unit,
using front of a religious or charitable organization.
financing, and shares profits with the sponsor.
games, taking a cut of every pot.
debt to a loan shark to pay the loan.
11
LAS VEGAS
d by OC leaders throughout the country, Siegel
built the Flamingo Hotel, the first elaborate LV gambling
establishment.
ed to OC bosses in proportion to their ownership.
hotel, the Stardust.

20. 12
CYBER-GAMBLING
24 hours
a
day.
jurisdiction.
-bookie” Calvin Ayre: headquartered in Costa Rica;
operates online casino with 145,000 customers, most in the U.S.
nce in U.S.; pays no U.S.
taxes;
net worth about $1 billion.
an
offshore sports betting business.
Internet.
uired to declare their winnings on tax
returns, but cyber-bookies do not file reports with the IRS.
13
CYBER-CRIME

21. government computer networks, and undermines
confidence in the international financial system.
-crime.
million from the U.S. banking system.
dit or cash cards.
a coordinated operation that took less than 24 hours.
14
CYBER-CRIME
e of encryption.
—physically and/or electronically.
o Family piggybacked bogus charges onto
credit cards and phone bills; $650 million taken.

22. 15
BOTNETS AND PROXY SERVERS
controlled remotely.
s.
a part of their criminal organization portfolio.
-servers conceal online activity, inhibiting law
enforcement pursuit of cyber-criminals.
16
LOANSHARKING (USURY)
-1915: “salary lending” thrived in the U.S.

23. ceilings on interest.
t business.
17
Usury:
loaning
money at an
exorbitant
interest rate.
OC USURY DURING
THE GREAT DEPRESSION
invest it, except the cash-poor economy.
including principle and interest.

24. -for-5 loan; for every $5 borrowed on
Monday, $6 is due the following Monday.
18
FENCING
19
COMMERCIAL SEX: PROSTITUTION
an important social phenomenon.
interstate transportation of women for immoral
purpose.
, OC organized the independent
brothels, requiring madams to pay protection.

25. entertainment bars pay “street taxes” to the Outfit.
20
COMMERCIAL SEX: PORNOGRAPHY
trolled by OC.
legitimate entrepreneurs entered the market.
of extorting money from porn shop owners.
timate, porn
operators were able to go to the authorities about
the extortion attempt.
21
TRAFFICKING IN PERSONS, ARMS,
AND COUNTERFEIT PRODUCTS
expanded the portfolios of criminal organizations,
particularly trafficking in persons, arms, and
counterfeit products.
22

26. TRAFFICKING IN PERSONS (TIP)
to work in brutal, inhumane conditions.
, and deception create a pliant
and exploitable work force.
23
HUMAN TRAFFICKING EXAMPLES
ountry of origin.

27. itation in Thailand.
24
TRAFFICKING IN ARMS
-conflict areas
and urban gangs, especially Africa and Latin America.
Linked to global crimes in multiple ways: shared
trafficking routes, same distribution networks and
money-laundering infrastructure, and exchange of
guns for drugs or other commodities.
25
TRAFFICKING IN COUNTERFEIT PRODUCTS
ual property (books, music, videos,
software); brand-name and designer clothing,
handbags, and jewelry; and pharmaceuticals.
That’s for the networks running importation and
distribution.
ns traffic in counterfeit goods, controlling
thousands of Chinese factories making fashion goods,

28. legally and illegally, for distribution around the world.
26