Labor racketeering is the infiltration and control of a union or employee benefits plan for personal benefit through illegal, fraudulent or violent means (U.S Department of Labor, 2004). Labor racketeering has majorly reduced competitive business opportunities and increased cost of goods and services. Racketeering is carried out through organized crime groups which use various sophisticated techniques as well as simple means to influence the plan. Among the schemes used are bribery, extortion, deprivation of union rights by violence, assurance fraud and complex financial schemes.
Labor racketeering classification categories
Traditional organized crime groups and racketeers who evolve around pension and employment benefits, proper labor-management relations and internal union corruption. According to the US department of labor, bribery, extortion of money, deprivation of union rights by violence and embezzlement are the main schemes used (Tripp, 2012).
Another category is unconventional organized group of racketeers. The reports obtained from the department of justice; there is a rise in nontraditional racketeering, mostly carried out in Asia, Russia, Eastern Europe and West Africa.
The big four
International brotherhood of teamsters, the Labors International Union, Hotel and Restaurant Employees union and International Longshoremen’s Assn collectively form a significant part of all the organized crimes and racketeering cases under investigation. Fifty percent of the ascertained facts of pension and employee benefits scheme involve the big four despite making and undergoing anti-corruption reforms (Tripp, 2012). Reported cases of strict control from the directors, abuse of power, finance and property, and damage of democratic systems and norms still occur under the influence of big four. Most acts in the recent past target the big four, involving foreign labor certification, unemployed insurance programs.
According to a report from the office of inspector general (OIG,) the majority of the culprits are service providers forming 19% out of the 94 cases worth $ 1billion (Harper, 2011). Large sum of money and assets are under control, hence vulnerable to corruption and extortion. Approximately growth of $220billion to $400 billion from 1993 to 1999 was registered by the Department of Labor (U.S Department of Labor, 2004). Further support to add into the list of organized crime is the conviction and pleading guilty of an attorney of Indiana Regional Council of Carpenters. According to the department of justice the bribery of $65,000 sent to the secretary-treasurer of the Regional Council for the purchase of land. Another example of organized and racketeering crime relates to Lucas organized crime family (Harper, 2011). According to the department of justice, through threatening, causing physical injury above the economic harm, New York City garment center business from 1980 through 1989 carried out extortion.
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In conclusion, the National Labor Relations Board (NLRB) mandated for the development and approving of national labor policies concerning employee organizational collective bargain rights. Remedying and prevention of unfair practice is another mandate, despite all the efforts, labor racketeering is a reality yet there is less evidence on the same. In line with the commission on justice and office of the inspector general (OIG), a large number of unions and union members engage in racketeering and untroubled about the problem. Creating a benefit of business and breeding area for corruption and a significant of the movement and trade unions run. Coming up with new measures to counter attack will be a key and involvement of all the stakeholders and departments at risk. Another hidden advantage is on the side of businessmen, jobbers and racketeers who benefit from manipulating prices. The prices hiked in such a way that no one can tell the economic gain to the foothold of the business world.