PENNSYLVANIA CORRUPT ORGANIZATIONS ACT OF 1970, THE - REPEALED — 1970 Pa. Act 276 (historical enacted text)

Historical Act text

Printer's No. 3085
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE·
Ho. 2297
BILL
Session of
1970
INTRODUCED BY MESSRS. ECKENSBERGER, MURTHA, M. E. MILLER, LEHR, O'PAKE,
GLEESON, KENNEDY, FISCHER, PIPER, FRANK, FEE AND HAYES, JUNE 2, 1970
REFERRED TO COMMITTEE ON LAW AND ORDER, JUNE 2, 1970
AN ACT
To prohibit certain transactions relating to the infiltration of legitimate business by
persons engaged in or connected with racketeering activities, providing
remedies and imposing penalties.
THE GENERAL ASSEMBLY OF THE COMMONWEALTH OF PENNSYLVANIA HEREBY
2 ENACTS AS FOLLOWS:
3 : Section 1. Short Title.--This act shall be known and may be cited as "The
4
Pennsylvania Corrupt Organizations Act of 1970,"
5 Section 2. Findings of Foct.--The General Assembly finds that:
6 (1)
Organized crime is a highly sophisticated, diversified and widespread phe-
7 nomenon which annually drains billions of dollars from the notional economy by various
8 patterns
of unlawful conduct including the illegal use of force, fraud and corruption;
9 (2)
Organized crime exists on a large scale within the Commonwealth of
10 Pennsylvania, engaging in the same patterns of unlawful conduct which characterize
11 its activities nationally;
12 (3) The vast amounts of money and power accumulated by organized crime are
13 increasingly used to inflltrote and corrupt legitimate businesses operating within the Com-
14 monweolth, together with all of the techniques of violence, intimidation and other
15 forms of unlawful conduct through which such money and power are derived;
-16 (4) In furtherance of such infiltration and corruption, organized crime utilizes

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and applies to its unlawful purposes laws'of the Commonwealth of Pennsylvania con-
ferring and relating to the privilege of engaging in various types of business and de-
signed to insure that such businesses are conducted in furtherance of the public interest
and the general economic welfare o"f the Commonwealth;
(5) Such infiltration and corruption provide an outlet for illegally obtained
capital, harm innocent investors, entrepreneurs, merchants and consumers, interfere
with free ~ompetition, and thereby constitute a substantial danger to the economic and
general welfare of the Commonwealth of Pennsylvania; and
(6) In order to successfully resist and eliminate this situation, it is necessary to
provide new remedies
and procedures.
Section
3. Definitions.--As used in this act:
(I) "Racketeering activity" means (A) any act which is indictable under any of
the following provisions of the act of June 24, 1939 (P. L. 872), known as "The Penal
Code": section
303 (relating to bribery), section 304 (relating to corrupt solicitation),
section
318 (relating to extortion), section 322 (relating to perjury), section 324 (re-
lating to hindering witnesses), section 328 (relating to falsification of matters within
jurisdiction
of State agencies), sections 512, 513, and 515 through 517 (relating to
prostitution), sections
601 through 609 (relating to gambling), sections 614 and 615
(relating to bribery in athletic contests), section 667 (relating to bribery of employes),
sections
669 and 670 (relating t9 coercion and intimidation of employes), section 683
(relating to influencing office rs of corporations, municipalities and public institutions),
section
701 (relating to murder), sections 704 and 705 (relating to robbery), section 723
(relating to kidnapping), sections 801 through eo6 (relating to blackmail), sections 817
through 819 (relating to receiving and transporting stolen property), sections 822 through
831 (relating to embezzlement), and sections 905 through 908 (relating to arson);
(B) any offense indictable under section 20 (d) of the act of September 26, 196 I (P. L.
1664), known as "The Drug, Device and Cosmetic Act" (relating to the sale and dis-
pensing
of narcotic drugs); (C) any conspiracy to commit any of the offenses set forth
in subclauses
(A) and (B) of this clause; or (D) the collection of any money or other
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property in full or partial satisfaction of a debt which arose as the result of the lending
of money
or other property at a rate of intetest exceeding twenty-five per cent per annum
or the equivalent
rate for a longer or shorter period, where not otherwise authorized by
l~w. lviy act which otherwise would be considered racketeering activity by reason of
the application af this clause, shall not be excluded from its application solely because
the
operative acts took place outside the jurisdiction of this Commonwealth, if such acts
would have been in violation of the law of the jurisdiction in which they occurred.
(2) "Person" means any individual or entity capable of holding a legal or bene-
ficial interest in property;
(3)
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Enterprise
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means any individual, partnership, corporation, association or
other legal entity, and any union or group of individuals associated in fact although not
a
legal entity, engaged in commerce;
(4) "Pattern of racketeering activity
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refers to a course of conduct requiring two or
more acts of racketeering activity, one of which occurred after the effective date of this
act;
(5)
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Racketeering investigator
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means an attorney, investigator or investigative
body so designated in writing by the Attorney General and charged with the duty of
enforcing or carrying into effect the provisions of this act;
(6) "Racketeering investigation" means any inquiry conducted by any racketeering
investigator for
the purpose of as~ertaining whether any person has been involved in any
violation of this act or of any order, judgment, or decree of any court duly entered in
any case or proceeding arising under this act;
(7) "Documentary material" means any book, paper, record, recording, tape,
report, memorandum, written communication, or other document relating to the business
affairs of any person or enterprise.
Section 4. 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 in which such person participated as a principal, to use or invest, directly or
indirecf.iy, any part of such income, or the proceeds of such income, in the acquisition
of any interest in, or the establishment or operation of, any enterprise: Provided,
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however, That a purchase of securities on the open market for purposes of investment,
2 and without the intention of controlling orparticipating in the control of the issuer, or
3 of assisting
another to do so, shall not be unlawful under this subsection if the securities
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of the issue held by the purchaser, the members of his immediate family, and his or their
5 accomplices in any pattern of racketeering activity after such purchase, do not amount
6 in the
aggregate to one per cent of the outstanding securities of any one class, and do
7 not confer, either in law or in fact
/
the power
to elect one or more di recto<' of the
8 issuer: Provided, further, That
if, in any proceeding involving an alleged investment
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violation of this subsection, it is established that over half of the defendant's aggre-
10 gate income for a period of two or more years immediately preceding such investment
11 was derived from a pattern of racketeering activity, a rebuttable presumption shall arise
12 that such investment included income derived from such pattern of racketeering activity.
13 (b) It shall be unlawful for any person through a pattern of racketeering activity
14 to acquire or maintain, directly or indirectly, any interest in or control of any enter-
15 prise.
16 (c) It shall.be unlawful for any person employed by or associated with any enter-
17 prise to conduct or participate, directly or indirectly, in the conduct of such enterprise's
18 affairs through a pattern of racketeering activity.
19 (d) It shall be unlawful for any person to conspire to violate any of the provisions
20 of subsections (a), (b) or (c) of this section.
21 Section 5. Criminal Penalties.--Whoever violates any provision of section 4 of
22 this act is guilty of a felony, and upon conviction thereof, shall be sentenced lo pay a
23 fine not exceeding
ten thousand dolla<' ($10,000), or to undergo imprisonment not exceed-
24 ing twenty years, or both. A violation of this section shall be deemed lo continue so long
25 as the person who committed the violation continues to receive any benefit from the viola-
26 lion.
27 Section 6. Civil'Remedies.--(a) The several courts of common pleas, and the
28 Commonwealth Court, shall have jurisdiction
lo prevent and restrain violations of section
29 4
of this act by issuing appropriate orde<', including but not limited to: (i) ordering any
30 person lo divest himself of any interest, direct or indirect; in the enterprise; imposing
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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; and
(ii) making due provision for the rights of innocent
persons, ordering the dissolution
of the enterprise, ordering the denial, suspension or
revocation of charters of domestic corporations, certificates of authority authorizing
foreign corporations to do business within the Commonwealth of Pennsylvania, licenses,
permits, or prior approval granted to any enterprise
by any deportment or agency of the
Commonwealth
of Pennsylvania; or prohibiting the enterprise from engaging in any business.
(b)
In any proceeding under this section, the court shall proceed as soon as
)
practicable to the hearing and determination thereof. Pending final determination, the
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court may enter preliminary or special injunctions, or take such other actions, including
the acceptance of satisfactory performance bonds, as it may deem proper.
(c) A final judgment or
decree rendered in favor of the Commonwealth of Penn-
sylvania in any criminal proceeding under this act shall estop the defendant from denying
the essential
allegations of the criminal offense in any subsequent civil proceeding under
th
is sec ti on.
(d) Proceedings under this section, at pretrial, trial and appellate levels, shall
be governed by the Pennsylvania Rules of Civil Procedure and all other rules and pro-
cedures relating to civil actions, except to the extent inconsistent with the provisions
of this
act.
Section 7. Enforcement.--(a) The Attorney General shall have the power and
duty to enforce the provisions of this act, including the authority to issue civil investiga-
tive demands pursuant to section 8; institute proceedings under section 6; and to take
such actions as may be necessary to ascertain and investigate alleged violations of this
act,
(b) The Attorney General and"the district attorneys of the several counties shall
have concurrent authority' to institute criminal proceedings under the provisions of this
act.
(c) Nothing contained in this section shall be construed to limit the regulatory
or investigative authority of any department or agency of the Commonwealth whose\
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functions might relate to persons, enterprises or matters falling within the scope of this
act.
Section 8. 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 material relevant to a racketeering investigation, he may
issue in writing, and cause to be served upon such person or enterprise, a civil investiga-
tive demand requiring the production of such material for examination.
(b) Each such demand shall:
(I) State the nature of the conduct constituting the alleged racketeering viola-
tion which is under investigation, the provision of law applicable thereto and the con-
nection between the documentary material demanded ond the conduct under investigation;
(2) Describe the class
or classes of documentary materia I to be produce~ there-
under with such definiteness and certainty as to permit such material to be fairly identi-
fied;
(3)
State that the demand is returnable forthwith or prescribe 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;
(4) Identify a racketeering investigator to whom such material shall be made
available; and
(5) Contain the following statement printed conspicuously at the top of the
demand:
"You have the right to seek the assistance of an attorney and he may represent
you in
all phases of the racketeering investigation of which this civil investigative demanc
isa part."
{c} No such demand shall:
(I} Contain any requirement which would be held to be unreasonable if con-
26 tained in a subpoena duces tecum issu~d by any court in connection with a grand jury
27 investigation
of such alleged racketeering violation; or
28 (2) Require the production of any documentary evidence which would be privilege
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from disclosure if demanded by a subpoena duces tecum issued by any court in connection
30 with a grand jury investig~tion of such alleged racketeering violation.
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(d) Service of any such demand or any petition filed under this section shall be
2 made
in the manner prescribed by the Pennsylvania Rules of Civil Procedure for service
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of writs and complaints.
4 (e) A verified return by the individual serving any such demand or
petition setting
5 forth the manner
of such service shall be prima facie proof of such service. In the case
6 of service by registered or certified mail, such return sha
II be accompanied by the return
7 post
office receipt of delivery of such demand.
8 (f) (1)
lviy party upon whom any demand issued under this section has been duly
9 served shall make such material
available for inspection and copying or reproduction to
0 the racketeering investigator designated therein at the principal place of business of such
1 party,
or at such other place as such investigator and such party thereafter may agree or
2 as the court may direct pursuant to this section, on the return date specified in such de-
3 mand, Such party may upon agreement of the investigator substitute copies of a II or any
4 part of such material for the originals thereof.
5 (2) The racketeering investigator to whom any documentary material is so de-
6 livered shall take physical possession thereof, and shall be responsible for the use made
7 thereof and for its return pursuant
to this section. The investigator may cause the prepara-
8 !ion of such copies of such documentary material as may be required for official use.
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While in the possession of the investigator, no material so produced shall be available
~O for examination, without the con~ent of the party who produced such material, by any
~1 individual other than the Attorney General or any racketeering investigator. Under
~2 such reasonable terms and conditions as the Attorney General shall prescribe, documentary
!3 material while in the possession of the investigator shall be available for examination by
!4 the party who produced such material or any duly authorized representative> of such
!5 party.
!6 (3) Upon completion of (i) th"e racketeering investigation for which any documen-
!7 tary material was produced under this section, and (ii) any case or proceeding arising
!8 from such investigation, the investigator shall return to the party who produced such
19 material all such material other than copies thereof made pursuant to this subsection
30 which have not passed into the control of any court or grand jury through introduction
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into the record of such case or proceeding,
2 (4) When any documentary materia I has been produced by any party unde'r this
3 section for use in any racketeering investigation, and no case or proceeding arising there
4 from has been instituted within a reasonable time after completion of the examination anc
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analysis of all evidence assembled in the course of such investigation, such party shall
6 be entitled, upon written demand made upon the Attorney General, to the return of all
7 documentary material, other than copies thereof made pursuant to this subsection, so
8 produced by such
party.
9 (g) Whenever any person or enterprise fails to comply with any civil investigativ•
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demand duly served upon him under this section or whenever satisfactory copying or r~pro
11 duction of any such material cannot be done and such party refuses to surrender such
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material, the Attorney General may file, in the court of common pleas for any county
13 in which such party resides or transacts business,
and serve upon such party a petition for
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an order of such court for the enforcement of this section, except that if such person Iran'
15 acts business in more than one county such petition shall be filed in the county in which
16 such party maintains his or its
principal place of business •
•
17 (h) Within twenty days after the service of any such demand upon any person or
18 enterprise, or at any time before the return date specified in the demand, whichever
19 period
is shorter, such party may file, in the court of common pleas of the county within
20 which such party resides or transa.cts business, and serve upon the Attorney General a
21 petition for an order of such court modifying or setting aside such demand, The time
22 allowed for compliance with the demand in whole or in part as deemed proper and ordere<
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by the court shall not run during the pend ency of such petition in the court. Such petitic
24 shall specify each ground upon which the petitioner relies in seeking s~ch relief, and mai
25 be based upon any failure of such demand to comply with the provisions of this section or
26 upon any constitutional or other legaf right or privilege of such party:
27 (i) At any time'during which the Attorn'ey General is in custody or control of
28 any documentary material delivered by any party in compliance with any such demand,
29 such party may file, in the court of common pleas of the county within which such docu-
30 mentary material was delivered, end serve upon the Attorney General a petition for en
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order of such court requiring the performance of any duty imposed by this section.
(j) Whenever any petition is filed in any court of common pleas under this section,
such court shall have jurisdiction to hear and determine the matter so presented, and,
after a hearing at which all parties are represented, to enter such order or orders as may
be required to carry into effect the provisions of this section.
Section 9. lmmunity.:..-Whenever any individual refuses, on the basis of his
privilege against self-incrimination, to comply with a civil investigative demand issued
pursuant to section 8 of this act or to testify or produce other information in any proceed-
1 ing under section 6 of this act, the Attorney General may invoke the provisions of the
)
act of November 22, 1968 (Act No. 333), entitled "An act authorizing courts of record
to grant witnesses immunitl:' from prosecution for or on account of any matter or thing
, 2 concerning which they were ordered to testify in a proceeding before certain grand juries
3 investigating committees or commissions and courts of record; making the refusal to testify
4 after such immunity criminal contempt and providing penalties," by presenting a petition
5 pursuant to section 2 of that act: Provided, however, That the phrase "cause of action"
~ in section 3 of that act shall not refer to civil proceedings brought pursuant to the pro-
7 visions of section 6 of th is act.
3 Section 10. Severability.--lf the provisions of any part of this act or the applica-
9 lion thereof to any person or circumstances be held invalid, the provisions of the other
::> parts and their application to oth~r persons or circumstances shall not be affect~d thereby.
1 Section 11. General Repealer.--All acts and parts of acts of the Assembly are
2 hereby repealed to the extent inconsistent with the provisions of this act.
3 Section 12. Effective Date.--This act shall take effect immediately.
E5S20RC
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