The gang boss made all his members follow the rules and kept them under his grip through fear.
Literal
Gang [of-の] leader [topic-は] member all [to-に] rules [object-を] cause-to-protect-and, fear-feeling [by-によって], members [object-を] took-grip-of.
規則を守る is transitive with 守る meaning 'to protect/observe [rules]' — to make someone follow rules, the causative 守らせる is used. によって ('by, through') is the formal instrumental compound — 'by means of, through.' 掌握する ('to grasp, to seize, to control') is a formal verb for exercising control. A vivid picture of criminal organization hierarchy.