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Answer for the clue "Racket payment from mystified non-competitor you returned ", 16 letters:
protection money

Word definitions for protection money in dictionaries

Wiktionary Word definitions in Wiktionary
n. Money paid, especially at regular intervals, to criminals or to corrupt officials who threaten to cause harm to the payer or to his or her business if the money is not paid.

Usage examples of protection money.

I kept a secondary doss in Purity, paying my protection money to the Amerindian street gang in the area.

Plus dozens of reports of intimidation, demands for protection money, pamphlets .

In 1925, the men had found their niche, shaking down Chicago speakeasy operators for protection money.

But in his early twenties he had the presence of mind to realize that if he kept loan-sharking and busting heads for protection money and hanging out on Dickson and Reed streets in Philly, his only rewards’.

He's expensive, of course, but nothing approaching the protection money.

He's how Rushima's being flooded, burned, blasted, or stormed until they pay Nueva Fallona's gang protection money.