Mussolini cracked down on organized crime pretty hard. But he didn’t completely wipe them out, and so when WW2 rolls along and the Allies are invading Italy, they actually get in contact with the surviving mafiosi and cut a deal with them to gather intelligence and organize resistance against the fascist state. This sort of thing continued after the war because the Mafia are also reliably anti-communist.

So yeah—a radical approach was taken to fix it, and then organized crime was reinstalled by the OSS and the CIA.