Definition of extortion


What is extortion?

Extortion is the misuse of actual or threatened force, violence, or intimidation to obtain money or property from an individual or entity. Extortion generally involves a threat to the person or property of the victim, or to their family or friends.

While the threat of violence or property damage is commonplace in extortion, it can also involve reputational damage or unfavorable government action.

Key takeaways

  • Extortion is the misuse of force, intimidation, or even actual or threatened violence to obtain money or property.
  • Generally, extortion generally involves a threat to the victim or their property, friends, or family members.
  • The Hobbs Act of 1946 prohibits extortion that affects interstate or foreign commerce.
  • Blackmail is a form of extortion, and ransomware is a growing way of doing it.
  • Organized criminal groups can carry out large-scale extortion in several countries.

Understanding extortion

In the United States, the Hobbs Act of 1946 prohibits actual or attempted robbery or extortion affecting interstate or foreign commerce.

The extortion statute of the Hobbs Act is frequently used in connection with public corruption cases and business disputes. To prove an extortion violation of the Hobbs Act, responses to the following points must be yes:

  1. Did the defendant induce or attempt to induce the victim to renounce property or property rights?
  2. Did the defendant use or attempt to use the victim’s reasonable fear of physical injury or financial damage to induce the victim’s consent to transfer the property?
  3. Did the defendant’s conduct actually or potentially obstruct or affect interstate or foreign commerce in any way?
  4. Was the actual or threatened use of force or violence by the accused unlawful?

Types of extortion

Extortion attempts can be unique in nature, such as attempts by misled people to extract large sums of money from celebrities, or more widespread. For example, extortion is carried out in an organized manner by national crime syndicates in many nations.

Blackmail is a form of extortion in which, rather than physical harm, the threat is the exposure of harmful information related to the victim. In recent years, the rapid proliferation of technology has led to extortion on an unprecedented scale.

Acts of extortion can range from “protection money” paid by small businesses, to local mobsters, to sophisticated cyber extortion schemes targeting hundreds of businesses.

On a smaller scale, such cyber extortion typically involves the use of malicious software (malware) known as ransomware, in which a person’s computer files are encrypted, rendering them unusable until a ransom is paid in bitcoin.

The largest cyber extortion attempts are almost global in scale and have been launched simultaneously in several countries.

Examples of extortion

In May 2017, a cyberattack infected tens of thousands of computers in nearly 100 countries with a ransomware called WannaCry. The attack disrupted operations at car production facilities, hospitals and schools, with Russia, Ukraine, Taiwan and the United Kingdom among the worst hit.

Cyber ​​extortionists reportedly used a hacking tool to trick thousands of users into opening malware attachments in emails that appeared to contain legitimate files. Once this self-propagating malware or “worm” was inside the network, it silently infected other vulnerable computers.

Theft is considered the most common form of extortion.

According to Symantec, WannaCry was much more dangerous than common ransomware “due to its ability to spread across an organization’s network by exploiting critical vulnerabilities in Windows computers, which were patched by Microsoft in Windows 2017.”

Investigators said the attack targeted Windows computers that had not installed Microsoft’s security patch or older machines running software that is no longer supported by Microsoft.

The extortionists demanded payment to restore access to the infected computers. They requested $ 300 and then $ 600 of bitcoin per infected device.

Another similar case involving ransomware was that of the Colonial Pipeline, which is the largest pipeline in the U.S. In 2021, Colonial Pipeline Company stated that it was the victim of a cyberattack involving ransomware, which resulted in the pipeline being deactivated. . completely.

The hacking group, DarkSide, was confirmed to be the perpetrator of the attack, executing it for money and not for political reasons. Colonial paid $ 4.4 million in bitcoins to stop the attack, which at the time was 75 bitcoins. The Justice Department has been able to recover 64 bitcoins out of the 75.

What is the legal definition of extortion?

The legal definition of extortion is the use of force, or threat of force, to obtain money or another item of value from another person. Many jurisdictions classify extortion as a “crime against property or a crime related to theft, but the threat of harm to a person is an essential element of the crime. This could consist of physical damage, financial damage, destruction of property or abuse of official power. “

Can a company be guilty of extortion to customers?

Extortion is considered a crime typically committed by individuals, whether they are private citizens or public officials; however, there are some statutes in which a corporation can be liable for extortion. Having said that, it would be one individual in a corporation who would enact extortion and that person would likely be liable rather than the entire company. The company may have to pay penalties.

How is extortion generally proven?

According to the Department of Justice, under the Hobbs Act, which relates primarily to interstate and foreign commerce, to prove extortion, four questions must be answered. These are (1) Did the defendant induce or attempt to induce the victim to relinquish property or property rights? (2) Did the defendant use or attempt to use the victim’s reasonable fear of physical injury or financial damage to induce the victim’s consent to transfer the property? (3) Did the defendant’s conduct actually or potentially obstruct, delay, or affect interstate or foreign commerce in any (realistic) way or degree? (4) Was the actual or threatened use of force, violence, or fear on the part of the accused unlawful?

How are extortion charges brought against someone?

The best way to bring extortion charges against someone is to report your case to the local police, usually to the police department in your area. Bringing any evidence of the extortion, such as documents, videos, text messages, etc., will help you file your police report.

www.investopedia.com

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Mark Holland

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