In the past, the black gangsters had bought their drugs from a middleman, the Mafia—which, as it happened, was then being pummeled by the federal government’s new anti-racketeering laws.
Here's how the Longman Dictionary of Contemporary English defines "pummel":

pum‧mel / ˈpʌm ə l / verb ( past tense and past participle pummelled , present participle pummelling British English , pummeled , pummeling American English ) [ transitive ]

1 to hit someone or something many times quickly, especially using your fist s (= closed hands ) SYN beat : Diane leaned over and pummeled the pillows.
pummel something with something She flew at him, pummelling his chest with her fists.

pummel at The cook pummelled at the dough.

The platoon was pummeled by heavy machine-gun fire.

2 informal to completely defeat someone at a sport
So, none definition applies to the sentence I quotes above. However, from the context I gather that "pummeled" means "hindered" by the anti-racketeering laws.

Is this a common usuage of "pummel"? It's not a very ovious one, just judging from the definitions in the dictionary.