Blackmail and Extortion

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BLACKMAIL AND EXTORTION

Extortion refers to obtaining property or compelling action by the use of threats or by the misuse of public office. The terms blackmail and extortion are often used interchangeably; yet in ordinary speech, they connote somewhat different behavior. Blackmail generally refers to hush money, and extortion refers to certain forms of public official misconduct and to those making threats of physical harm to person or property. Few "blackmail" statutes remain on the books, with most statutes prohibiting such behavior as extortion, theft, or criminal coercion.

Extortion is of two types: (1) extortion by threats or fear; and (2) extortion under color of office. Extortion by threats or fear (coercive extortion) can refer to any illegal use of a threat or fear to obtain property or advantages from another, short of violence, which would constitute robbery. Extortion offenses include not only threats obtaining property, but also those compelling any action against one's will (also called criminal coercion).

Statutes usually set out the kinds of threats that make up coercive extortion—for example, the threat to commit a crime, injure person or property, or expose a crime or contemptible information. The distinction traditionally drawn between robbery by intimidation and some forms of extortion is that a person commits robbery when he threatens to do immediate bodily harm, whereas he commits extortion when he plans to do bodily harm in the future. Historically, extortion under color of office is the seeking or receipt of a corrupt payment by a public official (or a pretended public official) because of his office or his ability to influence official action.

Extortion by a public official

Extortion is an older term than blackmail. In England, among the earliest extant statutes setting out the crime of extortion was the First Statute of Westminster (1275), 3 Edw. ch. 26 (repealed), which prohibited extortion by a sheriff or other royal official. According to William Hawkins, extortion at common law was "the taking of money by any officer, by colour of his office, either where none at all is due, or not so much is due, or where it is not yet due" (vol. 1, p. 316).

One sees much the same kind of public corruption case in the late 1200s as in modern cases. Then, as now, extortion has usually embraced takings by various methods: coercion, false pretenses, or bribery. Some American courts attempted to separate bribery and extortion, occasionally even claiming that the two crimes were mutually exclusive (Symposium, pp. 1717–1732). Nonetheless, a solid majority of cases (especially cases before 1850 and cases after 1970) hold that bribery and extortion overlap—sometimes even affirming bribery and extortion convictions for the same transaction.

Coercive extortion by a public official is the seeking or receiving of a corrupt benefit paid under an implicit or explicit threat to give the payer worse than fair treatment or to make the payer worse off than he is now or worse than he expects to be. The payee is guilty of extortion; the payer is the victim of extortion. Thus, coercive extortion has at least three baselines (fair treatment, expected treatment, and the status quo).

For example, it is extortion if a public official threatens to deny a public contract to a bidding contractor who clearly deserves to receive it unless the bidder pays off the official. The official would receive the payoff under a threat to give the contractor worse than fair treatment. In many jurisdictions the contractor would not have done anything illegal since he was forced to buy back only what he deserved in the first place, but in others he would be guilty of bribery. In most payoff situations, however, we will not clearly know who actually deserved to get a public contract. Usually, the official makes the bidder aware that he will not get the contract unless he pays off the official, and if the bidder pays, he will definitely get the contract. If the bidder does not pay, he gets less than fair treatment (coercive extortion). If he pays, he gets more than fair treatment (bribery). Thus the same envelope filled with cash can be both a payment extorted under a threat of unfairly negative treatment and a bribe obtained under a promise of unfairly positive treatment.

Blackmail and extortion by a private person

The first references to "blackmail" date from the sixteenth century, when Scotland made it a crime to obtain property by certain written threats of physical harm to person or property (1567 Scot. Parl. Acts, ch. 27). In 1722 the Waltham Black Act authorized the death penalty throughout the country for making certain written threats that demanded property as the price for refraining from physically endangering person or property (9 Geo. I, ch. 22, § 1 (1722) (repealed)). It was not until 1843 that Parliament finally extended blackmail to cover threats to expose evidence of embarrassing but noncriminal behavior (6 & 7 Vict., ch. 96, @ 3 (1843) (repealed)).

There were many other English statutes that did not mention blackmail but punished blackmail behavior; for example, the Elizabethan Informers' Statute (18 Eliz. I, ch. 5 (1576)) made it criminal for individuals to take money to suppress prosecutions. Further, at English common law, extortion by private citizens was punished, at least where the fear was the exposure of a crime that would lead to confinement (Lindgren, p. 674).

In the United States in 1796, New Jersey passed perhaps the first American statute prohibiting threats to expose any crime, not just a capital or infamous crime. In 1827, Illinois passed a statute prohibiting threats to expose "infirmities or failings" (Act of 1827, § 108 1827 Ill. Laws 145), sixteen years before similar threats were made illegal in England. In the influential Field Code (Proposed Penal Code of the State of New York (1865)), extortion was divided into three crimes: extortion (coercion seeking property), extortion under color of official right, and criminal coercion (seeking to compel action).

Modern American statutes vary considerably in the ways they define blackmail or extortion by a private person. Some statutes require that the threat accomplish its purpose. Under such a statute an unsuccessful threat may usually be prosecuted as a criminal attempt. But most modern statutes do not require that the extortionate threat succeed; the making of the threat is enough. The statutes also vary with regard to what must be demanded for the behavior to be illegal. Some statutes, for example, prohibit the obtaining of "property," or "any valuable thing." Many extortion or coercion statutes prohibit compelling action or inducing someone "to do or refrain from doing any act against his will" (Lindgren, pp. 676–677).

American blackmail and extortion statutes, unlike those in England, usually enumerate the types of prohibited threats. The most common are: (1) the threat of personal injury; (2) the threat to injure property (whether or not such an injury is physical); (3) the threat to accuse of a crime; and (4) the threat to expose any matter that would damage personal or business reputation or would expose the victim to hatred, contempt, or ridicule. Many other threats are prohibited under some state statutes: (1) the threat to commit any offense or any felony; (2) the threat to physically confine; (3) the threat to impair credit; (4) the threat to expose a secret; (5) the threat to strike or boycott, if a labor representative is seeking a personal payoff for not striking or boycotting; (6) the threat to give or withhold testimony; (7) the threat of a public official to take or withhold action against anyone or anything; and (8) the threat to inflict any other harm that would not benefit the threatener.

Because some of these prohibited threats often have legitimate uses, some jurisdictions give the threatener an affirmative defense that he genuinely believed that the property sought was due him or that he was only trying to right a wrong or obtain restitution. Other jurisdictions allow this "claim of right" defense only when the amount sought was previously ascertained, as with a preexisting debt. But some jurisdictions have not yet recognized the claim-of-right defense in any form.

Modern federal statutes

Federal statutes make many particular kinds of extortion or blackmail illegal. For example, extortion by officials of the federal government is a crime (18 U.S.C. § 872). It is blackmail to demand or receive a valuable thing by offering not to inform against anyone who has violated federal law (18 U.S.C. § 873). It is also prohibited to mail or transmit in interstate commerce certain threats with the intent to extort, including threats to accuse of a crime or to injure person, property, or reputation (18 U.S.C. §§ 875–877). The Travel Act (18 U.S.C. § 1952) also punishes certain kinds of blackmail and extortion.

The federal extortion statute that has generated the most litigation is the 1946 "Hobbs Act" (18 U.S.C. § 1951), which prohibits racketeering in interstate commerce. The act prohibits robbery and extortion when these would affect interstate commerce. The U.S. Supreme Court interpreted official extortion under the Hobbs Act in two cases from the early 1990s. In McCormick v. United States, 500 U.S. 257 (1991), the Court held that there was a requirement of an explicit quid pro quo in official extortion cases involving campaign contributions. Then, in Evans v. United States, 504 U.S. 255 (1992), the Court held that (1) there is no requirement of inducement for official extortion; (2) official extortion does not require coercion; (3) bribery is not a defense to extortion; (4) official extortion is not limited to false pretenses; and (5) the government "need only show that a public official has obtained a payment to which he was not entitled, knowing that the payment was made in return for official acts." Thus, bribery and extortion under color of official right substantially overlap.

The most controversial interpretations of the Hobbs Act have been in the area of labor extortion. In United States v. Teamsters Local 807, 315 U.S. 521 (1942), the Court restricted the operation of the Hobbs Act's predecessor so that is did not cover labor violence used to seek work or wages. In Enmons v. United States, 410 U.S. 396 (1973), the Court held that no extortion had occurred, although a union had allegedly blown up a power station to enforce its demands for higher wages. Apparently, only two basic types of union extortion are illegal under the Hobbs Act: where the work sought is totally unwanted or unneeded, and where a union official is seeking a personal payoff or kickback. In essence, the Court has refused to apply the Hobbs Act to unions that seek almost any legitimate objective, no matter what means are used to obtain that objective.

The paradox of blackmail

One of the most intractable intellectual problems in the criminal law is what Glanville Williams called the paradox of blackmail (p. 163). The problem is that combining two rights makes a wrong. For example, if I threaten to expose a businessman's income-tax evasion unless he gives me a lucrative contract, I have committed blackmail. I have a legal right to expose and to threaten to expose the tax evasion, and I have a legal right to seek a lucrative contract, but if I combine these rights I have committed blackmail. If both ends and means are otherwise legal, why is it blackmail to combine these legal ends and means? Since the 1920s, many theories have been offered to explain this paradox, and a few scholars, led by Walter Block, argue that blackmail ought to be legal since it violates no basic legal right of the "victim" (e.g., Block, p. 225). Even among scholars trying to resolve the paradox, there is no consensus on its resolution (Symposium, pp. 1565–2168).

One approach that is at least descriptively powerful is to look at the relationships between the parties. Consider first informational blackmail. Here the blackmailer threatens to tell others damaging information about the blackmail victim unless the victim heeds the blackmailer's request, usually a request for money. The blackmailer obtains what he wants by using extra leverage. But that leverage belongs more to a third person than to the blackmailer. The blackmail victim pays the blackmailer to avoid involving third parties; he pays to avoid being harmed by persons other than the blackmailer. When the reputation of a person is damaged, he is punished by all those who change their opinion of him. They may "punish" him by treating him differently or he may be punished merely by the knowledge that others no longer respect him.

Thus when a blackmailer threatens to turn in a criminal unless paid money, the blackmailer is bargaining with the state's chip. The blackmail victim pays to avoid the harm that the state would inflict. Of course, this does not effect a legally binding settlement, but the leverage is effective precisely to the extent that the victim believes that he has reached an effective settlement. Likewise, when a blackmailer threatens to expose damaging but noncriminal behavior unless paid money, he is also turning third-party leverage to his own benefit. What makes his conduct blackmail is that he interposes himself parasitically in an actual or potential dispute in which he lacks a sufficiently direct interest. In effect, the blackmailer attempts to gain an advantage in return for suppressing someone else's actual or potential interest. The blackmailer is negotiating for his own gain with someone else's leverage or bargaining chips.

This misuse of another's leverage is perhaps seen most clearly in noninformational black-mail—for instance, where a labor union leader threatens to cause a strike unless he is given a personal payoff. There the labor leader is turning group power and a group dispute to personal benefit. Whoever seeks a personal payoff by credibly wielding the power of a third party to harm the victim is a blackmailer.

James Lindgren

See also Bribery; Organized Crime; Robbery; Theft.