THE OLDER ORGANIZED CRIME GROUPS IN AMERICA HAVE GAINED A FOOTHOLD IN LEGITIMATE BUSINESSES BY THE RUTHLESS METHODS CUSTOMARILY USED IN THEIR TRADITIONAL ENTERPRISES OF NARCOTICS, TRAFFICKING, PROSTITUTION, AND GAMBLING. ILLEGAL METHODS ARE ALSO USED TO MAXIMIZE PROFITS THROUGH QUASI-LEGITIMATE BUSINESSES. ARSON IS FREQUENTLY USED TO DISABLE, TERRORIZE, OR EXTORT COMPLIANT BEHAVIOR FROM A BUSINESS COMPETITOR, AND TO DEFRAUD INSURANCE COMPANIES. IN CALIFORNIA THERE ARE APPROXIAMTELY 60 ARSONS DAILY AND ANOTHER 60 TO 70 DAILY FIRES CLASSIFIED AS BEING OF SUSPICIOUS ORIGIN. IN SAN JOSE, CALIF., AS IN LOS ANGELES AND SAN FRANCISCO, ARSON INVESTIGATIONS ARE CONDUCTED BY THE FIRE DEPARTMENTS; POLICE ARE ONLY SUPERFICIALLY INVOLVED. LOCAL FIRE DEPARTMENTS, WHILE EXPERT AT ARSON INVESTIGATION, ARE NOT EQUIPPED TO COLLECT INTELLIGENCE THAT CAN TIE AN ARSON CASE TO ORGANIZED CRIME. NO STATE AGENCY SYSTEMATICALLY COLLECTS OR DISSEMINATES DATA ON A REGULAR BASIS ON ORGANIZED CRIME ARSON CASES. IT IS SUGGESTED THAT CONGRESS CONSIDER LEGISLATION EARMARKING A SMALL PERCENTAGE OF BUSINESS TAXES TO FUND A VOLUNTARY EDUCATION PROGRAM TO ALERT BANKS AND MAJOR CORPORTATIONS TO THE DANGER AND METHODS OF INFILTRATION AND VICTIMIZATION BY ORGANIZED CRIME. IT IS REQUESTED THAT CONGRESS REVIEW THE EXEMPTIONS TO THE FREEDOM OF INFORMATION ACT AND CONSIDER STANDARD 2.4 OF THE NATIONAL ADVISORY COMMITTEE ON CRIMINAL JUSTICE STANDARDS AND GOALS TASK FORCE REPORT, WHICH CALLS FOR THE ACCOMMODATION OF LEGITIMATE LAW ENFORCEMENT NEEDS IN ORGANIZED CRIME CONTROL. FEDERAL FUNDING OF ARSON INTELLIGENCE EFFORTS BY FIRE AND POLICE PERSONNEL IS ALSO RECOMMENDED. (RCB)