All 19 Ways The New York Mafia Makes Money | How Crime Works | Insider

Summary

John Pennisi, a former member of the Lucchese crime family, reveals the inner workings of organized crime, detailing scams like the Range Rover scheme and the infiltration of legitimate businesses. He discusses the shift from traditional rackets to new methods, including cryptocurrency use in illegal activities and the ongoing presence in industries like food supply, sanitation, and construction. The summary highlights the adaptability of Cosa Nostra, illustrating their persistence in power through evolving money-making schemes.

Takeaways

• 🚗 The script describes a scam involving the purchase and export of Range Rovers from the U.S. to China, where they were sold for significantly higher prices.
• 🏭 Organized crime members have moved into legitimate businesses such as pizzerias, restaurants, and construction companies to launder their illicit gains.
• 🐟 The Fulton Fish Market was an area where organized crime had a significant presence through legitimate businesses, until law enforcement intervened.
• 🍽️ The food industry, including supplying restaurants with necessary products, has been a consistent source of income for organized crime, both in the past and present.
• 🎬 Hollywood's unions were historically controlled by organized crime, allowing them to manipulate the movie and music business, but this has since been curtailed by law enforcement.
• 🗑️ The sanitation industry still has a presence of organized crime, with members owning private sanitation companies.
• 💸 Tax evasion, tax fraud, and money laundering are ongoing issues within organized crime, with illegal earnings being funneled into legitimate businesses.
• 📈 Insider trading was a significant issue in the past, but strict regulations and enforcement have reduced its prevalence.
• 💵 Counterfeiting of currency has become more difficult due to advanced security features on modern bills, reducing its prevalence in organized crime activities.
• 🔑 The use of cryptocurrency is on the rise among criminals for conducting scams and illegal transactions, including payments for narcotics.
• 💰 Loan-sharking and gambling remain consistent money-making schemes for organized crime, with online gambling becoming a new avenue for these activities.
• 🔫 Gun trafficking and arms trafficking are less prevalent than in the past but still occur within organized crime circles.
• 💊 Drug dealing and trafficking, as well as prostitution and the sex industry, were significant earners for organized crime but have seen a decline in recent times.
• 📞 Extortion has evolved from targeting local businesses to focusing more on business-to-business debt collection, especially in the construction industry.
• 🛠️ The construction industry, including fiber optics installation, continues to be a source of illicit earnings through non-competitive bidding and other schemes.
• 👷‍♂️ The loss of organized crime's earning capabilities in certain areas like unions is attributed to increased government monitoring and regulation.

Q & A

What was the nature of the Range Rover scam described by John Pennisi?

The scam involved purchasing or financing Range Rovers in the United States and then shipping them to China where they were sold for almost four times the amount they were bought for, despite the stipulation against exporting the cars.

How did organized crime members transition into legitimate businesses?

They opened businesses such as pizzerias, restaurants, and construction companies, often using these as fronts for their illegal activities.

Why did Rudolph Giuliani intervene in the Fulton Fish Market?

He noticed the presence of organized crime members running legitimate businesses there and took action to remove them, disrupting their attempts to integrate into legitimate commerce.

How did organized crime groups infiltrate the food industry?

They created companies that supplied food to restaurants, insisting that these establishments use their products, and in some cases, they took control of existing restaurants.

What role did organized crime play in Hollywood's unions in the past?

They had a significant influence over the unions, which allowed them to manipulate and control aspects of the movie and music business.

How has the presence of organized crime in the sanitation industry evolved over time?

While there was a major crackdown and arrests in the past, members of organized crime still own private sanitation companies today.

What are the common practices related to tax evasion, tax fraud, and money laundering by Cosa Nostra?

They avoid reporting illegal earnings on taxes and launder money by investing in legitimate businesses, thereby 'cleaning' the illegally obtained funds.

How did the SEC's intervention impact Cosa Nostra's involvement in insider trading?

The SEC's actions led to indictments and imprisonment of many involved, effectively pushing organized crime groups out of the financial sector.

What changes have made counterfeiting more difficult for organized crime today?

Advanced bill design features such as specific emblems and embedded wires have made counterfeiting significantly harder and easier to detect.

How is cryptocurrency being used in criminal activities as described by John Pennisi?

Cryptocurrency is being used for scams and to pay for illegal activities such as buying narcotics, and even for loan-sharking repayments.

What has been the impact of government and FBI actions on the traditional earning capabilities of Cosa Nostra?

These actions have led to a reduction in earnings from traditional illegal activities, pushing Cosa Nostra to adapt and find new ways to generate income.

How have gambling and loan-sharking been interconnected in Cosa Nostra's operations?

Gambling and loan-sharking often go hand in hand, with loan sharks providing funds to gamblers who run out of money and then collecting debts, sometimes with interest.

What is the current state of prostitution and the sex industry as a moneymaking opportunity for organized crime?

Prostitution and the sex industry, including pornography and 1-800 sex calls, are no longer significant moneymaking opportunities for organized crime due to changes in societal and legal landscapes.

How has extortion evolved in the context of organized crime?

Extortion has become more difficult due to people's willingness to report to the authorities, leading to a shift towards business-to-business debt collection as a last resort.

What role did bid rigging play in the construction industry and how has it changed?

Bid rigging allowed certain contractors to be given jobs without a bidding process. However, this practice has been largely eliminated due to increased government oversight and regulation.

How is the involvement of organized crime in the fiber optics industry described by John Pennisi?

Organized crime groups were involved in installing fiber optics for large companies, often using subcontractors and manipulating charges without the need for competitive bidding.

What does John Pennisi compare Cosa Nostra to and why?

He compares Cosa Nostra to an amoeba because of its ability to change shapes and forms, constantly adapting to find new schemes and scams for making money.