On This Day.....

On October 19, 2000, William Hanhardt, retired Chief of Detectives for the Chicago Police Department, was indicted along with five others, accused of masterminding a nationwide jewel theft ring. Hanhardt and his co-defendants eventually pled guilty to the charges. Hanhardt was sentenced to fifteen years in prison.

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Will Vladimir Putin Take on The Mob?

An oil executive is gunned down with a rocket-propelled grenade in rush-hour traffic. A city-council member is indicted for running a murder-for-hire ring. Another gets his head blown off by a car bomb. Thugs beat an anti-corruption crusader with rubber truncheons. And organized crime is so pervasive that it gets its hooks into people even after they're dead: the local cemetery business is reputedly controlled by a ruthless gang led by a local "businessman" called "Kostya the Grave."

St. Petersburg, the elegant city of Pushkin and the Winter Palace, is today the capital of Kalashnikov Capitalism, a place where the "rule of law" gets trumped by an older principle: might makes right. It's also the birthplace of the just-inaugurated president of Russia, Vladimir V. Putin. Elected in part because of his promise to impose "a dictatorship of the rule of law," Putin could find no better place to start than the town where he first made his political reputation as deputy mayor. In Russia's most esthetically graceful city, the lines between commerce, politics and organized crime are about as thin as the cross hairs on a sniper's rifle. Since 1997 alone, according to law-enforcement statistics, there have been more than 200 contract murders carried out in St. Petersburg. Most of them remain unsolved.

Putin's initial moves against this culture of violence have not been promising. When he succeeded Boris Yeltsin at the end of last year, Putin seemed intent on ousting St. Petersburg's powerful governor, Vladimir Yakovlev. Yakovlev's critics--including a former local chief of police--claim he has ties to an organized-crime gang that is now the real power in town, having gained control of profitable local businesses like oil distribution on Yakovlev's watch. The governor has repeatedly denied the charge.

A couple of months ago Putin was talking tough about Yakovlev. At the February funeral for his old boss, the liberal St. Petersburg governor Anatoly Sobchak, a tearful Putin suggested that Sobchak died "as a result of persecution" from his political enemies. It was a clear reference to Yakovlev. Rumors flew that Putin would put the Kremlin's muscle behind popular former prime minister Sergei Stepashin to challenge Yakovlev in the governor's election next Sunday. Instead, for reasons that are not clear, Putin unexpectedly endorsed a political lightweight, a woman named Valentina Matviyenko.

Then, last month, Putin apparently decided that there would be no political war with Yakovlev at all. He forced Matviyenko to withdraw and clandestinely met with Yakovlev. Political sources in St. Petersburg assume Yakovlev offered a straightforward deal: loyalty to the Kremlin in exchange for a free ride when Yakovlev stands for re-election.

This week Putin will finally start to appoint his own people to positions of power. Many of them--his security-service chief, for one--will be from St. Petersburg. These are people who consider themselves graduates of the "good" St. Petersburg, the birthplace of the democracy movement in the late '80s that eventually brought down the Soviet Union. All, Putin included, worked for Sobchak.

In truth, Sobchak himself was no saint--he left the country in 1997 amid corruption charges, which he denied. But Yakovlev doesn't do a lot to counter the impression that forces loyal to him can play rough. One city-council member complained of corruption in Yakovlev's health-care bureaucracy. Assailants wielding rubber truncheons broke his nose, ribs and skull, but took no money or valuables. In October last year, Viktor Novosyolov, a powerful city-council member and onetime Yakovlev ally, was killed when a bomb placed on his car roof decapitated him. The victim was reputed to have organized-crime ties, but had broken with Yakovlev. According to several city-council members, Novosyolov had compromising material on Yakovlev that he was ready to make public.

It's far from clear what game Vladimir Putin is playing in St. Petersburg. Some suggest that, in return for withdrawing his opposition to Yakovlev's election, Putin asked him for help in getting the local "businessmen" to lay down their arms. Perhaps. But the only way to tell will be if the number of customers for Kostya the Grave finally begins to go down.

Thanks to Brain Whitmore

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Is Cicero Still a Mob Town?

In the 1920s, Al Capone and his gangsters, looking for a safe and protected place, moved their headquarters from Chicago to Cicero, Ill., a small town just west of the city. Some people, including a recent police chief there, say the mob never left. Carol Marin reports for 60 Minutes II. Cicero is a blue-collar town: Very few people in this suburb of about 70,000 ever get rich. But one group there has made money, for the better part of 80 years: a group known simply as "The Outfit."

Since Capone, other big-name bosses controlled the Cicero rackets: Frank Nitti, Capone's enforcer and handpicked successor; Sam "Momo" Giancana, who befriended John Kennedy and Marilyn Monroe, among others; and Tony "Big Tuna" Accardo, the most feared and respected of all mob bosses.

Nearly 40 years ago, Cicero was described by Cook County State's Attorney Dan Ward as "a walled city of the syndicate."

In 1989, that wall began to crack. The break began with Cicero native Bill Jahoda, who for 10 years was one of the mob's top bookies. He probably made about $10 million for the mob, he says. "I was in the gambling department," he says. "I [was] in the mob's hospitality wing, or the entertainment division. But let me tell you, gambling is a very dangerous and competitive line of work. There were three murders on my shift that I was aware of that related to gambling. In two of those cases I was what would be considered the setup guy. I steered the men to the place where they were ultimately killed."

Not long after that, Jahoda became a government informant, and his testimony helped convict 20 members of a gambling crew headquartered in Cicero. When his work was done, Jahoda left town a marked man. "The mob controlled town hall," Jahoda says. "It wasn't necessarily who was in there; it was who the mob put in there." The police department knew that it shouldn't interfere with the mob's businesses, Jahoda says.

"Any time there's a dollar there, the mob wants a piece of it," he says. "Whether it's coming out of protection, whether it's coming out of graft, whether it's coming out on contracts, whether it's coming out of unions, any time there's a dollar, the mob wants to get about 90 cents on it."

In the 1980s and 1990s the mob's man at town hall was Trustee Fank Maltese, according to Jahoda. Maltese and Betty Loren were married in 1988, with some of the mob's top men in attendance. Three years later a federal grand jury indicted Frank Maltese on gambling and racketeering charges. Maltese pled guilty to the federal charges.

Maltese died before he could be sent to prison, but not before pulling off what some consider his best political fix. In a closed-door meeting with other town trustees, Maltese had his wife, who had never been elected to any office, named Cicero town president. Betty Loren-Maltese, a tough politician with a penchant for big hair and false eyelashes, is still town president. When she took office, she would change Cicero's image, she said.

Cicero doesn't deserve its reputation, she says. "Every community has a problem but apparently we get the notoriety because everybody knows the name Cicero," she says. "Some people in Southern states say, 'Oh my God, Cicero.' They assume that there's hit men with machine guns on the street."

Since 1993 Loren-Maltese has closed down strip joints and taken on street gangs. Three years ago she set out to reform Cicero's police department, which by her own account was corrupt. After a nationwide search, she found David Neibur, at the time the police chief in Joplin, Missouri.

At first Neibur didn't want the job. But then Loren-Maltese promised him that he could root out corruption wherever he found it.

Neibur took the position and began trying to clean up the town. He took a look at Ram Towing, which had the exclusive, lucrative contract to tow cars in Cicero. Ram Towing got that contract after being in business just one week. Over the next two years Ram Towing, along with its sister company, gave more than $30,000 to the political campaign of Loren-Maltese.

Neibur says he had other questions, especially about how some companies were servicing police department vehicles. His department was paying to have cars tuned up that had just been tuned up weeks before, and paid for tires that never arrived, he says.

Neibur told Loren-Maltese about these allegations, he says. He also cited poker machines he says were making illegal payoffs in bars and restaurants. He asked his boss to outlaw the machines, which have been used by the mob as a way to make money. She refused, he says.

The FBI was also interested in the town's operations. It had bugged town hall as part of a corruption investigation with Loren-Maltese as one of the targets. The FBI wanted Neibur's help in its investigation, which is still going on, Neibur says.

Through an attorney, Ram Towing said it has done nothing wrong. When Neibur made his allegations of corruption, Cicero's special legal sounsel at the time, Merrick Rayle, investigated and said he found no wrongdoing. "I didn't hear about any, and I certainly didn't see it," Rayle says. "And it's not my sense, having worked with these folks, that they were corrupt in any fashion.

Rayle served as Cicero's special legal counsel for a year and a half. Besides investigating Neibur's claims, his other principal job was to catch and fire police officers who violated Cicero's residency requirements. His bill was $1.5 million. He did a lot of work for the money, Rayle says. He also contributed around $34,000 to Loren-Maltese's political fund during that time. There is no correlation between the donations and his hiring by the town, Rayle says. Rayle says Loren-Maltese fired him because his bills were too high. His replacement, a personal friend of the president, charged even more.

Even though he was fired by Loren-Maltese, Rayle says that he still likes her. "I think she has done a tremendous job as president of the town of Cicero," he says. "Lesser people would walk away from that job because of the constant turmoil, the constant bad press."

Four and a half months after Loren-Maltese hired Neibur to reform the Cicero police department, she fired him. Neibur is now suing. He was dismissed after turning over documents to the FBI alleging a pattern of fraud, he says. "[One] night, five members of the police department showed up at my house, seized my car, uniforms, ammunition and served me with a letter from Betty saying that I could no longer represent myself as a employee of the town of Cicero in any capacity," he says.

Loren-Maltese refused to comment on any of these matters. In a written statement the town's attorney said: "The exclusively negative nature of the topics submitted for discussion could only serve to harm the improving image of the town of Cicero." But in 1998, she did speak to a local TV station: "Does the town have a problem? Are there investigations going on? Yes. Will there always be? Yes, because we are Cicero."

Loren-Maltese dedicated the town's public safety building to the memory of her husband, the late mob felon.

Jahoda's testimony, which helped convict Maltese, was a blow to the outfit, but it was hardly fatal, he says. The man who now runs the day-to-day operation of the Chicago mob, is a former Cicero resident, Johnny "Apes" Monteleon, according to authorities. "I learned the hard way that Al Capone really never left Cicero," Neibur says. "I believe the organization still exists in Cicero.

Thanks to Carol Marin

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