What Is Extortion?

Extortion is the wrongful use of actual or threatened force, violence, or intimidation to gain money or property from an individual or entity. Extortion generally involves a threat being made to the victim’s person or property, or to their family or friends.

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

Key Takeaways

  • Extortion is the wrongful use of actual or threatened force, intimidation, or even violence to gain money or property.
  • Typically extortion generally involves a threat made to the victim or their property, friends, or family members.
  • The Hobbs Act of 1946 prohibits extortion affecting interstate or foreign commerce.
  • Blackmail is a form of extortion, and ransomware is a growing form of it.
  • Groups of organized criminals may carry out large-scale extortion in multiple 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 cases involving public corruption and commercial disputes. In order to prove a violation of Hobbs Act extortion, responses to the following points must be in the affirmative:

  1. Did the defendant induce or attempt to induce the victim to give up property or property rights?
  2. Did the defendant use or attempt to use the victim’s reasonable fear of physical injury or economic harm to induce the victim’s consent to give up property?
  3. Did the defendant’s conduct actually or potentially obstruct or affect interstate or foreign commerce in any way?
  4. Was the defendant’s actual or threatened use of force or violence wrongful?

Types of Extortion

Extortion attempts can either be one-off in nature—such as attempts by deluded individuals 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 damaging information related to the victim. In recent years, the rapid proliferation of technology has resulted in 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 targeted at hundreds of companies.

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 in Bitcoin has been paid.

Larger cyber extortion attempts are almost global in scale and have been launched simultaneously in multiple countries.

Examples of Extortion

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

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

Robbery is considered to be the most common form of extortion.

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

Researchers said the attack targeted Windows computers that had either not installed the Microsoft security patch, or older machines running software no longer supported by Microsoft.

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

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

The hacker group, DarkSide, was confirmed to be the originator of the attack, executing it for money as opposed to political reasons. Colonial paid $4.4 million in Bitcoin to stop the attack, which was 75 bitcoins at the time. The Department of Justice 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 theft-related offense, but the threat of harm to a person is an essential element of the offense. This could consist of physical harm, financial harm, destruction of property, or abuse of official power."

Can a Company Be Guilty of Extortion From Customers?

Extortion is considered a crime typically done by individuals, either private citizens or public officials; however, there are some statutes where a corporation can be liable for extortion. That being said, it would be an individual in a corporation that would be enacting the extortion and that person would most likely be held accountable as opposed to the entire company. The company may have to pay fines.

How Is Extortion Generally Proved?

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 as follows:

  1. Did the defendant induce or attempt to induce the victim to give up property or property rights
  2. Did the defendant use or attempt to use the victim's reasonable fear of physical injury or economic harm in order to induce the victim's consent to give up 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 defendant's actual or threatened use of force, violence, or fear wrongful?

How Do You File Extortion Charges Against Someone?

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