The Chicago Syndicate: Nicky Scarfo
Showing posts with label Nicky Scarfo. Show all posts
Showing posts with label Nicky Scarfo. Show all posts

Tuesday, December 04, 2018

Home of Mayor Raided by @FBI Special Agents

The mayor of Atlantic City made headlines last month when he was involved in a fight outside a casino that was captured on video. The mayor, Frank Gilliam, was not charged. But Mr. Gilliam may be facing more serious trouble. Yesterday, federal officials raided his home, removing computer equipment and boxes in an operation that represents another setback for this struggling seaside city.

“The F.B.I. was at the mayor’s home in Atlantic City in an official capacity executing a search warrant,” said Doreen Holder, a spokeswoman for the F.B.I.’s office in Newark. Ms. Holder said the I.R.S. was also involved in the search, but she declined to offer any other details.

Video posted on social media showed about a dozen agents going in and out of the home on Ohio Avenue.

The mayor’s office declined to comment about what prompted the raid. “We can tell you that the mayor’s office is open, and we are here to provide services to Atlantic City residents and to serve the administration in any way that we can,” said Christina Bevilacqua, the deputy chief of staff in the mayor’s office.

Shortly after 12:30 p.m. Monday, Mr. Gilliam emerged from his house and left in a Mercedes-Benz S.U.V. He did not respond to shouted questions from reporters gathered at the end of his driveway.

The F.B.I. operation is the latest chapter in what has been a tumultuous couple of months for Mr. Gilliam, a Democrat. The late-night brawl he was involved in took place outside the Golden Nugget casino in Atlantic City; surveillance video obtained from the casino showed the mayor swinging wildly at an unknown man. Casino security intervened to break up the fight.

The cause of the melee has never been made clear. Prosecutors said they would not pursue criminal charges against Mr. Gilliam.

Mr. Gilliam has also faced complaints about his campaign finances. The mayor and the Atlantic City Democratic Committee quarreled over a $10,000 check that had been made out to the committee, but that Mr. Gilliam deposited into his campaign account. The committee filed a criminal complaint in March, but a judge later dismissed the case.

Mr. Gilliam was elected in 2017, defeating the incumbent mayor Don Guardian, a Republican who had clashed frequently with the administration of former Gov. Chris Christie over the state’s decision to take over Atlantic City’s finances. The city was on the brink of bankruptcy as its casino industry struggled.

Mr. Gilliam, a native of Atlantic City who had served as a city councilman since 2009, campaigned on a “new era” message, saying that Atlantic City’s struggles were the result of poor management of city government and the casinos. He faulted Mr. Guardian for allowing the state takeover and said the largely Democratic city needed to return to its Democratic roots.

He promised to court developers and bring in businesses. Since taking office, two casinos have opened where old ones had shuttered. But he also promised to broaden Atlantic City’s appeal, seeking to establish the resort city as a family-friendly destination. “We’ve lost our identity because of gaming,” Mr. Gilliam said during the campaign. “If everyone got to the table, Atlantic City would find its way.”

The F.B.I. raid on Mr. Gilliam’s home, however, is a reminder of the long history of criminal behavior among some of Atlantic City’s top public officials.

Robert W. Levy, who was elected mayor in 2006, disappeared in 2007 amid rumors of a pending federal investigation into his military record and benefits. He was found to have checked into an addiction and rehabilitation facility in central New Jersey, and later admitted in court to falsifying his military records to receive veterans benefits.

In 1991, James L. Usry, who had been mayor for six years and was Atlantic City’s first elected African-American mayor, pleaded guilty to campaign contribution violations after prosecutors accused of him accepting $6,000 in cash and a $500 check in exchange for supporting an ordinance that would have benefited a business owned by the donor. Mr. Usry and four city councilmen were indicted.

And in 1984, Michael J. Matthews, who had been elected mayor in 1982, was charged with extortion, bribery and conspiracy as part of a wide-ranging sting operation against organized crime. Federal authorities said he maintained a close relationship with Nicodemo “Little Nicky” Scarfo, an infamous organized crime leader, that predated Mr. Matthews’s election as mayor. Mr. Matthews pleaded guilty to a single count of extortion.

Atlantic City also played a central role in the Abscam scandal, which resulted in the convictions of several members of Congress on charges of bribery and political corruption, including Senator Harrison A. Williams of New Jersey.

At the center of the scandal were promises for casino partnerships and revenue in Atlantic City.

“I’ll give you Atlantic City — without me, you do nothing,” Angelo J. Errichetti, who was then mayor of Camden, N.J., boasted to an undercover agent about arranging a casino license for a $50,000 kickback.

Thanks to Nick Corasaniti.

Friday, September 02, 2016

Did @RealDonaldTrump Join Investors with Reputed Mobs Ties on First Casino?

For years, Donald Trump has boasted that his casinos are free of the taint of organized crime, using this claim to distinguish his gambling ventures from competitors. But Trump's casinos turn out not to be so squeaky clean.

One of his prime Atlantic City developments, the Trump Plaza Hotel & Casino, relied on a partnership with two investors reputedly linked to the mob, prompting New Jersey regulators to force Trump to buy them out. And he employed a known Asian organized crime figure as a vice president at his Taj Mahal casino for five years, defending the executive against regulators’ attempts to take away his license, according to law enforcement officials.

As the famously brash developer now considers a run for the presidency, this history could complicate his efforts to project an image of a trusted power in the business world. It exposes a seamy underside to Trump's rise to fortune -- one that involved intimate links to unsavory characters.

As voters learn more about such links between Trump and reputed organized crime figures, "it will get more difficult for him," says John Geer, a political science professor at Vanderbilt University. "Under that withering examination, his past associations and troubles will all emerge and could make it tough in a Republican primary."

In his 2000 book, “The America We Deserve,” released to coincide with an earlier prospective presidential campaign, Trump boasted:

“One thing you can say about Trump, as the holder of a casino gaming license, is that I’m 100 percent clean -- something you can’t say with certainty about our current group of presidential candidates.”

Trump has sought to lean on such claims while sometimes intimating that industry competitors are themselves tainted by mob associations -- in order to saddle them with restrictions on their casino licenses.

On Oct. 5, 1993, Trump told a Congressional panel examining the rise of Indian casinos -- then, a rapidly emerging threat to Atlantic City -- that the proprietors were vulnerable to organized crime.

It is “obvious that organized crime is rampant,” Trump told the panel, according to a transcript, drawing a direct contrast to his own operations. “At the Taj Mahal I spent more money on security and security systems than most Indians building their entire casino, and I will tell you that there is no way the Indians are going to protect themselves from the mob.”

That broadside garnered Trump a reprimand from then-House Interior Committee Chairman George Miller, a California Democrat, who complained that he had never heard more irresponsible testimony. But Trump continued, predicting that Indian casinos would spawn “the biggest crime problem in the nation’s history.”

Trump’s neglected to mention that his initial partners on his first deal in Atlantic City reputedly had their own organized crime connections: Kenneth Shapiro was identified by state and federal prosecutors as the investment banker for late Philadelphia mob boss Nicky Scarfo according to reports issued by New Jersey state commissions examining the influence of organized crime, and Danny Sullivan, a former Teamsters Union official, is described in an FBI file as having mob acquaintances. Both controlled a company that leased parcels of land to Trump for the 39-story hotel-casino.

Trump teamed up with the duo in 1980 soon after arriving in Atlantic City, according to numerous news reports and his real estate broker on the deal, Paul Longo. The developer seized on a prime piece of property and partnered with Shapiro and Sullivan, but the state’s gambling regulators were concerned enough about Shapiro and Sullivan’s mob links that they required Trump to end the partnership and buy out their shares, according to several Trump biographies.

Trump's office did not respond to requests for comment. Both Sullivan and Shapiro died in the early 1990s.

Trump later confided to a biographer that the twosome were “tough guys,” relaying a rumor that Sullivan, a 6-foot, 5-inch bear of a man, killed Jimmy Hoffa, the Teamsters boss who disappeared in July 1975.

“Because I heard that rumor, I kept my guard up. I said, ‘Hey, I don’t want to be friends with this guy.’ I’ll bet you that if I didn’t hear that rumor, maybe I wouldn’t be here right now,” Trump told Timothy L. O’Brien, the author of “TrumpNation: The Art of Being The Donald” and current national editor of The Huffington Post.

Trump told a different story to casino regulators who were deciding whether to grant him the lucrative gambling license. “I don’t think there’s anything wrong with these people,” he said about Shapiro and Sullivan during licensing hearings in 1982, according to "TrumpNation : The Art of Being The Donald." “Many of them have been in Atlantic City for many, many years and I think they are well thought of.”

Sullivan's unsavory reputation did not stop Trump from later arranging for him to be hired as a labor negotiator for the Grand Hyatt, a hotel project on Manhattan’s East Side, according to People magazine and the Los Angeles Times. Trump also introduced Sullivan to his own banker at Chase, though he declined to guarantee a loan to Sullivan, reported the L.A. Times.

Longo, the real estate broker Trump used in Atlantic City on the Trump Plaza deal, says he wasn’t aware of Shapiro or Sullivan having any mob ties, and insisted Trump didn’t have any problems at all obtaining his gaming license. “In AC, you always had to be careful who you were dealing with, but Donald did things on the level,” Longo told The Huffington Post. But Wayne Barrett’s biography, “Trump: The Deals and the Downfall,” alleges Trump considered using Shapiro as a go-between to deliver campaign contributions to Atlantic City mayor Michael Matthews, in violation of state law.

Casino executives are prohibited from contributing to Atlantic City political campaigns in New Jersey. Sullivan later claimed that he was present when Trump proposed funneling contributions through Shapiro. Trump denied the allegation in an interview with O’Brien. Matthews, who was later forced out of office and served time in prison for extortion, did not return calls from HuffPost.

Barrett also reported that Trump once met Anthony “Fat Tony” Salerno, front boss of the Genovese crime family, at the Manhattan townhouse of their mutual lawyer -- infamous J. Edgar Hoover sidekick Roy Cohn. The author explained that Salerno’s company supplied all the concrete used in the Trump Towers in New York.

At the time of its publication, Trump slammed Barrett's book as “boring, nonfactual and highly inaccurate.”

Barrett's book prompted New Jersey casino regulators to investigate some of its allegations, but the state never brought any charges. "If there had been a provable charge, they would have brought it,” said former casino commission chairman Steven P. Perskie.

While Trump was making his bold statements about the integrity of the Taj Mahal at the 1993 congressional hearing on Indian gaming, a reputed organized crime figure was running junkets for the hotel, bringing in well-heeled gamblers from Canada. Danny Leung, the hotel’s former vice president for foreign marketing, was identified by a 1991 Senate subcommittee on investigations as a member of the 14K Triad, a Hong Kong group linked to murder, extortion and heroin smuggling, according to the New York Daily News.

Canadian police testified at a 1995 hearing before New Jersey’s casino commission that they observed Leung working in illegal gambling dens in Toronto alongside Asian gang leaders. Leung, who denied any affiliation with organized crime, had his license renewed by the commission over the objection of the Division of Gaming Enforcement.

Back in the early 1980s, just as Trump was dipping his toes into Atlantic City real estate, the developer did express concern to the FBI that his casino ventures might expose him to the mob and “tarnish his family’s name.” He even offered to place undercover FBI agents in his casinos, according to an FBI memo uncovered by TheSmokingGun.com. When Trump asked one of the agents his “personal opinion” on whether he should build in Atlantic City, the agent replied that there were “easier ways that Trump could invest his money.”

That proved prescient: In early 2009, Trump’s casino company in Atlantic City filed for Chapter 11 bankruptcy, just days after Trump resigned from the board.

Thanks to Marcus Baram

Wednesday, June 08, 2016

Here's What's Known about @realDonaldTrump's Reputed Mob Ties

In his signature book, Trump: The Art of the Deal, Donald Trump boasted that when he wanted to build a casino in Atlantic City, he persuaded the state attorney general to limit the investigation of his background to six months. Most potential owners were scrutinized for more than a year. Trump argued that he was “clean as a whistle”—young enough that he hadn’t had time to get into any sort of trouble. He got the sped-up background check, and eventually got the casino license. But Trump was not clean as a whistle. Beginning three years earlier, he’d hired mobbed-up firms to erect Trump Tower and his Trump Plaza apartment building in Manhattan, including buying ostensibly overpriced concrete from a company controlled by mafia chieftains Anthony “Fat Tony” Salerno and Paul Castellano. That story eventually came out in a federal investigation, which also concluded that in a construction industry saturated with mob influence, the Trump Plaza apartment building most likely benefited from connections to racketeering. Trump also failed to disclose that he was under investigation by a grand jury directed by the U.S. attorney in Brooklyn, who wanted to learn how Trump obtained an option to buy the Penn Central railroad yards on the West Side of Manhattan.

Why did Trump get his casino license anyway?
Why didn’t investigators look any harder?
And how deep did his connections to criminals really go?

These questions ate at me as I wrote about Atlantic City for The Philadelphia Inquirer, and then went more deeply into the issues in a book, Temples of Chance: How America Inc. Bought Out Murder Inc. to Win Control of the Casino Business. In all, I’ve covered Donald Trump off and on for 27 years, and in that time I’ve encountered multiple threads linking Trump to organized crime. Some of Trump’s unsavory connections have been followed by investigators and substantiated in court; some haven’t. And some of those links have continued until recent years, though when confronted with evidence of such associations, Trump has often claimed a faulty memory. In an April 27 phone call to respond to my questions for this story, Trump told me he did not recall many of the events recounted in this article and they “were a long time ago.” He also said that I had “sometimes been fair, sometimes not” in writing about him, adding “if I don’t like what you write, I’ll sue you.”
I’m not the only one who has picked up signals over the years. Wayne Barrett, author of a 1992 investigative biography of Trump’s real-estate dealings, Trump: The Greatest Show on Earth: The Deals, the Downfall, the Reinvention, has tied Trump to mob and mob-connected men.

No other candidate for the White House this year has anything close to Trump’s record of repeated social and business dealings with mobsters, swindlers, and other crooks. Professor Douglas Brinkley, a presidential historian, said the closest historical example would be President Warren G. Harding and Teapot Dome, a bribery and bid-rigging scandal in which the interior secretary went to prison. But even that has a key difference: Harding’s associates were corrupt but otherwise legitimate businessmen, not mobsters and drug dealers.

This is part of the Donald Trump story that few know. As Barrett wrote in his book, Trump didn’t just do business with mobbed-up concrete companies: he also probably met personally with Salerno at the townhouse of notorious New York fixer Roy Cohn, in a meeting recounted by a Cohn staffer who told Barrett she was present. This came at a time when other developers in New York were pleading with the FBI to free them of mob control of the concrete business.

From the public record and published accounts like that one, it’s possible to assemble a clear picture of what we do know. The picture shows that Trump’s career has benefited from a decades-long and largely successful effort to limit and deflect law enforcement investigations into his dealings with top mobsters, organized crime associates, labor fixers, corrupt union leaders, con artists and even a one-time drug trafficker whom Trump retained as the head of his personal helicopter service.

Now that he’s running for president, I pulled together what’s known – piecing together the long history of federal filings, court records, biographical anecdotes, and research from my and Barrett’s files. What emerges is a pattern of business dealings with mob figures—not only local figures, but even the son of a reputed Russian mob boss whom Trump had at his side at a gala Trump hotel opening, but has since claimed under oath he barely knows.

Neither Trump’s campaign spokesperson, Hope Hicks, nor Jason Greenblatt, the executive vice president and chief legal officer at the Trump Organization, responded to several emailed requests for comment on the issues raised in this article.

Here, as close as we can get to the truth, is what really happened.

After graduating in 1968 from the University of Pennsylvania, a rich young man from the outer boroughs of New York City sought his fortune on the island of Manhattan. Within a few years Donald J. Trump had made friends with the city’s most notorious fixer, lawyer Roy Cohn, who had become famous as lead counsel to Senator Joseph McCarthy. Among other things Cohn was now a mob consigliere, with clients including “Fat Tony” Salerno, boss of the Genovese crime family, the most powerful Mafia group in New York, and Paul Castellano, head of what was said to be the second largest family, the Gambinos.

This business connection proved useful when Trump began work on what would become Trump Tower, the 58-story high-rise where he still lives when he’s not at his Florida estate.

There was something a little peculiar about the construction of Trump Tower, and subsequent Trump projects in New York. Most skyscrapers are steel girder construction, and that was especially true in the 1980s, says John Cross of the American Iron & Steel Institute. Some use pre-cast concrete. Trump chose a costlier and in many ways riskier method: ready-mix concrete. Ready-mix has some advantages: it can speed up construction, and doesn’t require costly fireproofing. But it must be poured quickly or it will harden in the delivery truck drums, ruining them as well as creating costly problems with the building itself. That leaves developers vulnerable to the unions: the worksite gate is union controlled, so even a brief labor slowdown can turn into an expensive disaster.

Salerno, Castellano and other organized crime figures controlled the ready-mix business in New York, and everyone in construction at the time knew it. So did government investigators trying to break up the mob, urged on by major developers such as the LeFrak and Resnick families. Trump ended up not only using ready-mix concrete, but also paying what a federal indictment of Salerno later concluded were inflated prices for it – repeatedly – to S & A Concrete, a firm Salerno and Castellano owned through fronts, and possibly to other mob-controlled firms. As Barrett noted, by choosing to build with ready-mix concrete rather than other materials, Trump put himself “at the mercy of a legion of concrete racketeers.”

Salerno and Castellano and other mob families controlled both the concrete business and the unions involved in delivering and pouring it. The risks this created became clear from testimony later by Irving Fischer, the general contractor who built Trump Tower. Fischer said concrete union “goons” once stormed his offices, holding a knife to throat of his switchboard operator to drive home the seriousness of their demands, which included no-show jobs during construction of Trump Tower. But with Cohn as his lawyer, Trump apparently had no reason to personally fear Salerno or Castellano—at least, not once he agreed to pay inflated concrete prices. What Trump appeared to receive in return was union peace. That meant the project would never face costly construction or delivery delays.

The indictment on which Salerno was convicted in 1988 and sent to prison, where he died, listed the nearly $8 million contract for concrete at Trump Plaza, an East Side high-rise apartment building, as one of the acts establishing that S &A was part of a racketeering enterprise. (While the concrete business was central to the case, the trial also proved extortion, narcotics, rigged union elections and murders by the Genovese and Gambino crime families in what Michael Chertoff, the chief prosecutor, called “the largest and most vicious criminal business in the history of the United States.'')

FBI agents subpoenaed Trump in 1980 to ask about his dealing with John Cody, a Teamsters official described by law enforcement as a very close associate of the Gambino crime family. The FBI believed that Cody previously had obtained free apartments from other developers. FBI agents suspected that Cody, who controlled the flow of concrete trucks, might get a free Trump Tower apartment. Trump denied it. But a female friend of Cody’s, a woman with no job who attributed her lavish lifestyle to the kindness of friends, bought three Trump Tower apartments right beneath the triplex where Donald lived with his wife Ivana. Cody stayed there on occasion and invested $500,000 in the units. Trump, Barrett reported, helped the woman get a $3 million mortgage without filling out a loan application or showing financials.

In the summer of 1982 Cody, then under indictment, ordered a citywide strike—but the concrete work continued at Trump Tower. After Cody was convicted of racketeering, imprisoned and lost control of the union, Trump sued the woman for $250,000 for alteration work. She countersued for $20 million and in court papers accused Trump of taking kickbacks from contractors, asserting this could “be the basis of a criminal proceeding requiring an attorney general’s investigation” into Trump. Trump then quickly settled, paying the woman a half-million dollars. Trump said at the time and since then that he hardly knew those involved and there was nothing improper his dealings with Cody or the woman.

There were other irregularities in Trump’s first big construction project. In 1979, when Trump hired a demolition contractor to take down the Bonwit Teller department store to make way for Trump Tower, he hired as many as 200 non-union men to work alongside about 15 members of the House Wreckers Union Local 95. The non-union workers were mostly illegal Polish immigrants paid $4 to $6 per hour with no benefits, far below the union contract. At least some of them did not use power tools but sledgehammers, working 12 hours a day or more and often seven days a week. Known as the “Polish brigade,” many didn’t wear hard hats. Many slept on the construction site.

Normally the use of nonunion workers at a union job site would have guaranteed a picket line. Not at this site, however. Work proceeded because the Genovese family principally controlled the union; this was demonstrated by extensive testimony, documents and convictions in federal trials, as well as a later report by the New York State Organized Crime Task Force.

When the Polish workers and a union dissident sued for their pay and benefits, Trump denied any knowledge that illegal workers without hard hats were taking down Bonwit with sledgehammers. The trial, however, demonstrated otherwise: Testimony showed that Trump panicked when the nonunion Polish men threatened a work stoppage because they had not been paid. Trump turned to Daniel Sullivan, a labor fixer and FBI informant, who told him to fire the Polish workers.

Trump knew the Polish brigade was composed of underpaid illegal immigrants and that S&A was a mob-owned firm, according to Sullivan and others. "Donald told me that he was having his difficulties and he admitted to me that — seeking my advice — that he had some illegal Polish employees on the job. I reacted by saying to Donald that 'I think you are nuts,'" Sullivan testified at the time. "I told him to fire them promptly if he had any brains." In an interview later, Sullivan told me the same thing.

In 1991, a federal judge, Charles E. Stewart Jr., ruled that Trump had engaged in a conspiracy to violate a fiduciary duty, or duty of loyalty, to the workers and their union and that the “breach involved fraud and the Trump defendants knowingly participated in his breach.” The judge did not find Trump’s testimony to be sufficiently credible and set damages at $325,000. The case was later settled by negotiation, and the agreement was sealed.

While Trump’s buildings were going up in Manhattan, he was entering a highly regulated industry in New Jersey – one that had the responsibility, and the means, to investigate him and bring the facts to light.

From the beginning, Trump tried to have it both ways. While he leveraged Roy Cohn’s mob contacts in New York, he was telling the FBI he wanted nothing to do with organized crime in Atlantic City, and even proposed putting an undercover FBI agent in his casinos. In April of 1981, when he was considering building a New Jersey casino, he expressed concern about his reputation in a meeting with the FBI, according to an FBI document in my possession and which the site Smoking Gun also posted. “Trump advised Agents that he had read in the press media and had heard from various acquaintances that Organized Crime elements were known to operate in Atlantic City,” the FBI recorded. “Trump also expressed at this meeting the reservation that his life and those around him would be subject to microscopic examination. Trump advised that he wanted to build a casino in Atlantic City but he did not wish to tarnish his family’s name.”

Part of the licensing process was supposed to be a deep investigation into his background, taking more than a year for would-be casino owners, but Trump managed to cut that short. As he told the story in Trump: The Art of the Deal, in 1981 he threatened to not build in Atlantic City unless New Jersey’s attorney general, John Degnan, limited the investigation to six months. Degnan was worried that Trump might someday get approval for a casino at the Grand Hyatt Hotel in Manhattan, which could have crushed Atlantic City’s lucrative gaming industry, so Degnan agreed to Trump’s terms. Trump seemingly paid Degnan back by becoming an ardent foe of gambling anywhere in the East except Atlantic City—a position that obviously protected his newfound business investment as well, of course.

Trump was required to disclose any investigations in which he might have been involved in the past, even if they never resulted in charges. Trump didn’t disclose a federal grand jury inquiry into how he obtained an option to buy the Penn Central railroad yards on the West Side of Manhattan. The failure to disclose either that inquiry or the Cody inquiry probably should have disqualified Trump from receiving a license under the standards set by the gaming authorities.

Once Trump was licensed in 1982, critical facts that should have resulted in license denial began emerging in Trump’s own books and in reports by Barrett—an embarrassment for the licensing commission and state investigators, who were supposed to have turned these stones over. Forced after the fact to look into Trump’s connections, the two federal investigations he failed to reveal and other matters, the New Jersey Division of Gaming Enforcement investigators circled the wagons to defend their work. First they dismissed as unreliable what mobsters, corrupt union bosses and Trump’s biggest customer, among others, had said to Barrett, to me and other journalists and filmmakers about their dealings with Trump. The investigators’ reports showed that they then put Trump under oath. Trump denied any misconduct or testified that he could not remember. They took him at his word. That meant his casino license was secure even though others in the gambling industry, including low-level licensees like card dealers, had been thrown out for far less.

This lapse illustrated a fundamental truth about casino regulation at the time: Once the state licensed an owner, the Division of Gaming Enforcement had a powerful incentive not to overturn its initial judgment. State officials recited like a mantra their promise that New Jersey casinos were the most highly regulated business in American history, more tightly regulated than nuclear power plants. In Temples of Chance, I showed that this reputation often owed less to careful enforcement than to their willingness to look the other way when problems arose.

In 1986, three years after Trump Tower opened, Roy Cohn was disbarred for attempting to steal from a client, lying and other conduct that an appellate court found “particularly reprehensible.” Trump testified that Cohn, who was dying from AIDS, was a man of good character who should keep his license to practice law.

This was not the only time Trump went to bat publicly for a criminal. He has also spoken up for Shapiro and Sullivan. And then there was the case of Joseph Weichselbaum, an embezzler who ran Trump’s personal helicopter service and ferried his most valued clientele. Trump and Weichselbaum were so close, Barrett reported in his book, that Weichselbaum told his parole officer about how he knew Trump was hiding his mistress, Marla Maples, from his first wife, Ivana, and tried to persuade Trump to end their years-long affair.

Trump’s casinos retained Weichselbaum’s firm to fly high rollers to Atlantic City. Weichselbaum was indicted in Ohio on charges of trafficking in marijuana and cocaine. The head of one of Trump’s casinos was notified of the indictment in October 1985, but Trump continued using Weichselbaum—conduct that again could have cost Trump his casino license had state regulators pressed the matter, because casino owners were required to distance themselves from any hint of crime. Just two months later Trump rented an apartment he owned in the Trump Plaza apartment building in Manhattan to the pilot and his brother for $7,000 a month in cash and flight services. Trump also continued paying Weichselbaum’s firm even after it went bankrupt.

Weichselbaum, who in 1979 had been caught embezzling and had to repay the stolen money, pleaded guilty to two felonies. Donald Trump vouched for Weichselbaum before his sentencing, writing that the drug trafficker is “a credit to the community” who was “conscientious, forthright, and diligent.” And while Weichselbaum’s confederates got as many as 20 years, Weichselbaum himself got only three, serving 18 months before he was released from the urban prison that the Bureau of Prisons maintains in New York City. In seeking early release, Weichselbaum said Trump had a job waiting for him.

Weichselbaum then moved into Trump Tower, his girlfriend having recently bought two adjoining apartments there for $2.4 million. The cash purchase left no public record of whether any money actually changed hands or, if it did, where it came from. I asked Trump at the time for documents relating to the sale; he did not respond.

As a casino owner, Trump could have lost his license for associating with Weichselbaum. Trump has never been known to use drugs or even drink. What motivated him to risk his valuable license by standing up for a drug trafficker remains unclear to this day. Trump, in his phone call to me, said he “hardly knew” Weichselbaum.

The facts above come from court records, interviews and other documents in my own files and those generously made available by Barrett, who was the first journalist to take a serious investigative look at Trump. Our files show Trump connected in various deals to many other mobsters and wise guys.

There was, for example, Felix Sater, a senior Trump advisor and son of a reputed Russian mobster, whom Trump kept on long after he was convicted in a mob-connected stock swindle. And there was Bob Libutti, a racehorse swindler who was quite possibly Trump’s biggest customer at the casino tables at the time. Libutti told me and others about arrangements that went beyond the “comps”—free hotel rooms and services, for example—that casinos can legally give to high-rollers. Among these was a deal to sell Trump a less-than-fit horse at the inflated price of $500,000, though Trump backed out at the last minute. Libutti accused Trump of making an improper $250,000 payment to him, which would have cost Trump his license. The DGE dismissed Libutti as unreliable and took Trump at his word when he denied the allegations. (Libutti was a major figure in my 1992 book Temples of Chance.)

Some of the dealings came at a remove. In Atlantic City, Trump built on property where mobsters controlled parts of the adjoining land needed for parking. He paid $1.1 million for about a 5,000-square-foot lot that had been bought five years earlier for just $195,000. The sellers were Salvy Testa and Frank Narducci Jr., a pair of hitmen for Atlantic City mob boss Nicky Scarfo who were known as the Young Executioners. For several adjoining acres, Trump ignored the principal owner of record and instead negotiated directly in a deal that also likely ended up benefiting the Scarfo mob. Trump arranged a 98-year lease deal with Sullivan, the FBI informant and labor fixer, and Ken Shapiro, described in government reports as Scarfo’s “investment banker.” Eventually the lease was converted into a sale after the Division of Gaming Enforcement objected to Sullivan and Shapiro being Trump’s landlords.

Trump later boasted in a sworn affidavit in a civil case that he made the deals himself, his “unique contribution” making the land deals possible. In formal hearings Trump later defended Sullivan and Shapiro as “well thought of.” Casino regulators thought otherwise, and banned Sullivan and Shapiro from the casino industry. But the Casino Control Commission was never asked to look into FBI reports that Trump was involved, via Shapiro, in the payoffs at the time of the land deals that resulted in Mayor Michael Mathews going to prison.

Thanks in part to the laxity of New Jersey gaming investigators, Trump has never had to address his dealings with mobsters and swindlers head-on. For instance, Barrett reported in his book that Trump was believed to have met personally with Salerno at Roy Cohn’s townhouse; he found that there were witnesses to the meeting, one of whom kept detailed notes on all of Cohn’s contacts. But instead of looking for the witnesses (one of whom had died) and the office diary one kept, the New Jersey Division of Gaming Enforcement (DGE) took an easier path. They put Trump under oath and asked if he had ever attended such a meeting. Trump denied it. The inquiry ended.

Taking Trump at his word that he never met with the mobsters in Cohn’s townhouse saved the casino investigators from having to acknowledge their earlier failure—that from the start, they had never properly investigated Trump and his connections to criminals. They certainly had the leverage to push harder if they chose. Indeed, two of the five Casino Control commissioners in 1991 declared that the DGE showed official favoritism to Trump. Commissioner David Waters complained that DGE did not go nearly far enough in seeking a $30,000 fine against Trump for taking an illegal loan from his father, which could be grounds to revoke Trump’s casino licenses. Waters called it “an outrage that the Division of Gaming Enforcement would take this position and fail to carry out what I understand to be its responsibility to enforce the provisions of the Casino Control Act.”

Even after he got his license, Trump continued to have relationships that should have prompted inquiries. For example, he made a deal to have Cadillacs dolled up with fancy interiors and exteriors beginning in 1988, marketing them as Trump Golden Series and Trump Executive Series limousines. The modifications were made at the Dillinger Coach Works, which was owned by a pair of convicted felons, convicted extortionist Jack Schwartz and convicted thief John Staluppi, who was so close to mobsters that he was invited to the wedding of a mob capo’s daughter. New York liquor regulators proved tougher than those in New Jersey, denying Staluppi, a rich car dealer, a license because of his rap sheet and his extensive dealings with mobsters, as Barrett’s former reporting partner Bill Bastone found in public records. So why did Trump repeatedly do business with mob owned businesses and mob-controlled unions? Why go down the aisle with an expensive mobbed-up concrete firm when other options were available?

“Why’d Donald do it?” Barrett said when I put the question to him. “Because he saw these mob guys as pathways to money, and Donald is all about money.” From a $400 million tax giveaway on his first big project, to getting a casino license, to collecting fees for putting his name on everything from bottled water and buildings to neckties and steaks, Trump’s life has been dedicated to the next big score. Through Cohn, Trump made choices that—gratuitously, it appears—resulted in his first known business dealings with mob-controlled companies and unions, a pattern that continued long after Cohn died.

What Trump has to say about the reasons for his long, close and wide-ranging dealings with organized crime figures, with the role of mobsters in cheating Trump Tower workers, his dealings with Felix Sater and Trump’s seeming leniency for Weichselbaum, are questions that voters deserve full answers about before casting their ballots.

Thanks to David Cay Johnston.

Monday, November 26, 2012

Mafia Prince: Inside America’s Most Violent Mafia Family and the Bloody Fall of La Cosa Nostra

Mafia Prince is the first-person account of one of the most violent eras in Mafia history —“Little” Nicky Scarfo’s reign as boss of the Philly family in the 1980s—written by Scarfo’s underboss and nephew, “Crazy” Phil Leonetti.

The youngest-ever underboss at the age of 31, Leonetti was at the crux of the violent downfall of the traditional American Mafia in the 1980s when he infiltrated Atlantic City after gambling was legalized, and later turned state’s evidence against his own. His testimony directly led to the convictions of dozens of high-ranking made men including John Gotti, Vincent Gigante, and his own uncle, Nicky Scarfo—sparking the beginning of the end of La Cosa Nostra.

Just as The Godfather and Boardwalk Empire defined the early 20th century Mafia, and Wiseguy and Casino depicted the next great era through the ’70s, Mafia Prince concludes this epic genre revealing the Mafia’s violent final heyday of the 1980s— straight from the horse’s mouth.

Wednesday, November 02, 2011

Little Nicky Scarfo Jr's Son Among 12 Arrested and Charged with Racketeering

The son of a Philadelphia mob boss, Nicodemo "Little Nicky" Scarfo Jr., and 12 others, are charged with racketeering and other offenses in an indictment handed down Tuesday morning. And Federal prosecutors say members of that mob have turned to a modern crime -- pillaging the assets of a mortgage company -- in a sign that organized crime is evolving to include more white-collar crime.

Thirteen people -- including lawyers and an accountant -- were charged in a federal indictment unsealed Tuesday. Most of them were arrested in raids throughout the morning in New Jersey, Florida and Texas.

Among them were Nicodemo S. Scarfo, the son of imprisoned Lucchese crime family boss Nicodemo D. "Little Nicky'' Scarfo, five lawyers and a certified public accountant. Eight of them were due in court Tuesday afternoon.

They face charges including racketeering, wire fraud, money laundering, false statements on a loan application, securities fraud. Maximum penalties range from five years in prison to decades. "The criminal activity is evolving,'' said Michael Ward, agent-in-charge of the FBI in Newark. "It's going from the back alleys to the boardrooms.''

Authorities say the plot started in April 2007, when the younger Scarfo and his associate Salvatore Pelullo, who has previously been convicted of financial crimes, decided to take over FirstPlus Financial Group, a publicly traded mortgage company based in Irving, Texas. Authorities said it was a company with a lot of cash but not much sophistication.

The indictment charges Scarfo and Pelullo used threats to help wrest control of the company. Pelullo is accused of telling a member of the FirstPlus' board that if he didn't go along with the plan, "your kids will be sold off as prostitutes.''

The indictment says he later told others who were charged in the scheme to get the company's board to agree to hand control to his and Scarfo's new directors -- and he wanted it done immediately. He allegedly told them: "I don't care if they're in a funeral parlor, I don't care if they're in a (expletive) hospital on a respirator, we'll send somebody there. I want their vote, I want their signature, and I want it done by the close of the day today.''

Authorities say the elder Scarfo, serving in a federal prison in Atlanta, was apprised of the plot, but that he was not charged because he's expected never to be released.

After getting control of FirstPlus, Scarfo and Pelullo are accused of having it buy shell companies they owned so they could take out money. After that, authorities said, they signed a series of consulting contracts to pay themselves even more.

In less than a year, authorities said, they took $12 million and spent it on multiple homes, including one for Scarfo's ex-wife; weapons and ammunition, a plane, an Audi, a Bentley, $30,000 in jewelry and an 83-foot, $850,000 yacht they named "Priceless.'' U.S. Attorney Paul Fishman wouldn't say exactly how authorities got onto the plot, but he said it ended with a series of raids in 2008.

Since then, FirstPlus has filed for bankruptcy, blaming the alleged criminals for wrecking the firm.

Fishman said the alleged conspirators were planning one more "piece de resistance:'' They wanted to pump up the stock price of FirstPlus and sell off the company. He said that was their exit strategy. "We had a different exit strategy.''

Thanks to NBC40

Sunday, March 21, 2010

Mobsters in South Florida Use New Ways to Face New Rivals

Ever since the ruthless Chicago mobster Al Capone bought a mansion on Miami's Palm Island in 1928, South Florida has been a destination for organized crime figures who want to relax and do a little business.

The rackets have evolved over the years — loan-sharking, extortion and gambling have largely given way to stock scams, money laundering and white-collar fraud — and the Italians and Jews of yore have been joined by rival contingents from Russia, Israel and South America. But the culture of greed and violence has remained a constant.

Mobsters generally prefer to keep a low profile hereGangsters of Miami: True Tales of Mobsters, Gamblers, Hit Men, Con Men and Gang Bangers from the Magic City, but La Costa Nostra — "this thing of ours" — is once more in the headlines, this time connected with Ponzi schemer Scott Rothstein.

Upon his return from Morocco last November, Rothstein reportedly went to work for the FBI, even as agents were dismantling his $1.2 billion investment fraud.

Roberto Settineri, the alleged Sicilian mobster whom Rothstein is credited with bringing down this month, appears to have the same short fuse and propensity for violence, according to a Miami Beach police report, that has marked mob behavior for a century.

As Settineri lunched at Soprano Cafe on Lincoln Road in January, he got into a heated argument with a security guard, stood up, and pulled back his leather jacket to reveal a black semi-automatic pistol.

"I will put this gun in your f------ mouth now. I know where you live. I'll go to your f------ house and kill you and your family," Settineri told the guard, according to his arrest report.

The pending aggravated assault charge against Settineri, 41, is the least of his concerns. Federal prosecutors allege he was a key intermediary between a crime family in Sicily and the Gambino crime family in New York City.

Settineri and two of his reported associates — security firm operators Daniel Dromerhauser, of Miami, and Enrique Ros, of Pembroke Pines — were indicted March 10 on federal charges of money laundering and obstruction of justice for reportedly shredding two boxes of documents at Rothstein's request and laundering $79,000 for him.

The Mafia's traditions in South Florida date to the 1930s gambling heydays in Broward, when Meyer Lansky and his associates came south to claim a piece of the action in dozens of "carpet joints" — classy casinos that operated around Hallandale under the beneficial eye of a crooked sheriff.

"It goes back to the 1920s and Al Capone. Capone had a house on Palm Island … and that was his alibi for the 1929 St. Valentine's Day Massacre," said Richard Mangan, a 24-year Drug Enforcement Administration agent.

"Back in the 1940s and 1950s, Hallandale was Las Vegas Southeast," said Mangan, who now teaches a class called "Organized Crime and the Business of Drugs" at Florida Atlantic University's School of Criminology. "Clubs like La Boheme were operating. A made [formally inducted] mob member named Anthony "Tony" Plates would set up shop in the Diplomat Hotel during the winters, plying politicians with booze and hookers."

The gambling generated so much cash that the gangsters suppressed their violent natures.

"The Mafia had an understanding that there would be no killings in Broward County because it was such a lucrative business," said Robert Jarvis, a professor at Nova Southeastern University Law School and a gambling-law expert.

By the early 1950s, government scrutiny forced the mobsters out of their illegal casinos but not the county. They still had their hands in local dog and horse tracks and jai lai frontons, as well as in shakedown schemes. They expanded their gambling ventures to Cuba under the tutelage of Lansky, who lived for years in a canal home in Sunny Isles, a popular mob neighborhood.

"Many of the mob people — Chicago, New Orleans, New York — would come down here because they owned casinos in Havana, and [Cuban leader Fulgencio] Batista was more than happy to take bribes," Mangan said.

Hundreds of them made Broward their second or retirement home.

New York's five organized crime consortiums — the Gambino, Genovese, Bonanno, Colombo and Lucchese families — have always considered Florida to be "open," with no one family claiming exclusive rights to operate in the Sunshine State. "This is open territory for anyone with the mob for whatever they want to do," said Nick Navarro, a 30-year law enforcement official who was Broward's sheriff from 1984 to 1993. "It's a beautiful part of the country and this is where they like to come down."

With the dramatic expansion of air conditioning in the 1950s and cheap jet flights, Florida had a commercial building boom over the next decades, drawing more mobsters.

"The Mafia has long been involved in the rigging of construction contracts," Jarvis said.

By 1968, a state crime commission concluded, "South Florida, especially Dade and Broward counties, has become a haven for many known Mafia figures and associates, though their activities know no local boundaries within the state."

In more recent years, "The Teflon Don," Gambino boss John Gotti, maintained a residence in Fort Lauderdale. So did Nicodemo "Little Nicky" Scarfo, the brutal head of a Mafia family operating in Philadelphia and Atlantic City.

Underbosses, consiglieres and soldiers from all the families are well represented, from Palm Beach Gardens to the Keys.

They still get involved in gambling, loan sharking, strip clubs, prostitution, drug dealing and extortion, but have gravitated toward more sophisticated crimes — such as stock and Medicare fraud — that don't carry the same risks.

They have faced increased competition from Israeli organized crime and Russian mobsters.

"The biggest change has been the Russian mafia," Mangan said. "The Russians started moving in after the fall of communism. They primarily set up in South Beach. They started opening banks in Antigua and Aruba."

Federal prosecutors roll out indictments against the Italian Mafia every year, charging everything from murder to money laundering, but younger Mafiosi come up the ranks to fill the voids left by the prison sentences and old-age deaths of top family members.

"It's a funny thing — it's always said that the Mafia has been destroyed and all the old chieftains are dead or in jail; but every time you turn around, there is a story about the Mafia," Jarvis said.

"To the extent that the Mafia exists anywhere, it would have its hand in South Florida because it still has all the attributes that made it so attractive in the 1930s — warm weather, a lot of wealth, a lot of opportunity. Why wouldn't the Mafia be here? Everyone else wants to be in South Florida."

Thanks to Jon Burnstein and Peter Franceschina

Wednesday, June 03, 2009

Mobsters Heading to The Shore for Traditional Summer Vacations

It's going to be a real mob scene at the Shore again this summer. And police up and down the coast are getting ready.

That's mob as in M-O-B.

Wiseguys.

Goodfellas.

From Seaside Heights to Sea Isle City, law enforcement agencies are gearing up for a special group of sun-seekers who trade the sidewalks of South Philadelphia, Newark, and New York for the beaches, bars, and boardwalks of the Jersey coast.

It's part of a summer tradition.

"They go there to unwind," said Ron Rozwadowski, an investigator with the New Jersey Division of Criminal Justice and former member of the State Police organized-crime squad that helped dismantle Nicodemo "Little Nicky" Scarfo's crime family back in the 1980s.

Rozwadowski, in fact, did a study on wiseguys summering at the Jersey Shore. Twenty years later, he says, little has changed. "It's easy to blend in," the veteran investigator said. "You have towns where the population quadruples. If there's 20 cars parked in front of a house, it's no big deal."

Crowded bars and restaurants offer easily accessible meeting places. A noisy boardwalk is the perfect barrier to audio surveillance. And the hyperkinetic action at the casinos provides another layer of cover.

That's not to say that all mobsters end their stints at the Shore tanned and rested.

Philadelphia mob boss Joseph "Skinny Joey" Merlino was taken into custody by the FBI at his rented condo in Margate in the summer of 1999, the start of what became a 14-year prison sentence built around a racketeering case.

The Scarfo crime family came undone in 1986 when the State Police bugged a condo on the Boardwalk in Ocean City where mobster Thomas "Tommy Del" DelGiorno was spending the summer with his family. And one of the most damaging pieces of video surveillance played at Scarfo's racketeering trial in 1988 was a shot of him meeting with mob informant Nicholas "Nicky Crow" Caramandi on the Boardwalk outside the Resorts International Casino-Hotel. The tape was used to independently support Caramandi's account of that meeting.

Ralph Natale, another former mob boss, enjoyed spending time in Sea Isle City, where one of his daughters had a home.

His successor, reputed Philadelphia mob leader Joseph "Uncle Joe" Ligambi, has spent several recent summers in Margate, just south of Atlantic City, where a proliferation of upscale restaurants and bars has turned the once-frat-party-like bar scene into a more sophisticated night out.

The presence of Ligambi and other reputed mobsters has not gone unnoticed.

"We just keep our eyes and ears open for the state and federal agencies," said Margate Police Chief David Wolfson, who heads a 33-member department. "We beef up patrols, we do different things," Wolfson said of the department's approach to the influx of tourists and summer visitors. "Our investigative unit goes 24 hours a day. They're always on call."

But reputed mobsters, he said, are treated no differently than anyone else. "If they break the law, they're arrested," he said. "But dealing with them specifically, no, we don't do anything differently."

Low-key and taciturn, Ligambi has spent big chunks of June, July, and August in Margate each summer since his release from prison in 1997 after his mob-murder conviction was overturned. A creature of habit, Philadelphia police sources say, Ligambi last summer routinely headed for his rented Shore home on Thursday or Friday and returned to South Philadelphia on Monday or Tuesday. This year, they say, he has been spotted at his brother's home in nearby Longport, a posh Shore community nestled between Margate and Ocean City.

Barring any unexpected developments - Ligambi is the target of an ongoing FBI racketeering investigation, and the feds have a habit of making their arrests in the summer - the reputed crime kingpin could be celebrating his 70th birthday in August at the beach.

Younger members of the organization are usually part of the weekend crowd at Shore towns up and down the coast. Law enforcement sources say many will end up at Memories in Margate on Saturday nights. The popular bar, owned by Philadelphia's iconic disc jockey Jerry Blavat, draws a young, hip crowd, a mix of movers-and-shakers, wiseguys, and wannabes.

Rozwadowski said the Shore has always been "neutral" territory. He recalled that, during his State Police days, a surveillance in Seaside Heights turned up members of the Genovese, Gambino, Lucchese, and DeCavalcante crime families getting together.

Even before legalized casinos, Atlantic City was a magnet for mobsters. One of the most famous organized-crime confabs in history occurred in 1929 at the old President Hotel on the Boardwalk.

Among those attending was Al Capone, whose trip home to Chicago was short-circuited when he was arrested on a gun charge during a train stop in Philadelphia. He ended up spending about a year in the old Eastern State Penitentiary. His former cell is now a set piece of the prison museum on that site. And while Ligambi might cringe at the ostentation, not every mobster has taken a low-key approach at the Shore.

Scarfo, in the early days of casino gambling, was often spotted ringside at prize fights in the casino-hotels. Other mobsters, before being placed on the casino-exclusion list, would belly up to the craps and blackjack tables.

For younger mobsters and their associates, the game of choice now appears to be poker, and law enforcement authorities keeping tabs on the mob at the Shore regularly check the posh poker lounges in the casino-hotels.

Merlino, even before his arrest on racketeering charges, was a lightning rod for law enforcement. He was cited for gambling in a casino despite the fact that he was on the state's exclusion list, and on Labor Day 1998, he was given a series of citations for public drinking, resisting arrest, and littering. The littering charge came after he took the citation for public drinking, balled it up, and threw it on the ground in front of the police officer who issued it.

He paid a fine to settle his criminal problems, but not before he and others suggested they had been "targeted" because of their alleged underworld affiliations. Not so, said the police.

Wolfson, Margate's chief, said he has taken a very basic approach to the presence of reputed mob figures in his town. "They get treated the same way as everybody else," he said. "If they're not going to drive me crazy, I'm not going to drive them crazy."

Thanks to George Anastasia

Tuesday, January 20, 2009

Mob Connected to Multi-State Theft Ring?

There were new details Wednesday about possible mob connections to a multi-state theft ring broken up by Pennsylvania State Police.

Fox 29's Dave Schratwieser reports one of the defendants offered to wear a wire against the local mob and name names -- some very familiar names.

Pennsylvania Attorney General Tom Corbett mentioned possible mob connections to the theft ring. But now court documents and mob experts gave Fox 29 News an inside look at what those connections might be and where they might lead.

Authorities were tight-lipped about possible mob connections during Tuesday's takedown of an interstate theft ring that victimized area golfers, but they didn't deny a potential link. "There's a potential organized crime component, but we can't go into any great detail at this point on that," Corbett said.

The ring allegedly stole credit cards from golfers' cars at local country clubs to finance a $100,000 high-end shopping spree. Troopers wouldn't get specific, but court documents obtained by Fox 29 say accused ringleader Michael Pacitti offered to take troopers on a guided tour of the local mob.

"You've got an individual who was willing to give up some information, wear a wire, talk about organized crime, talk about drug dealing, talk about robberies," Inquirer mob reporter George Anastasia said.

Pacitti told troopers he would "do whatever's necessary" to stay out of jail. He promised to name names, but sources said he never mentioned mob boss Joe Ligambi or his top lieutenants. "It's intriguing because it's just another part of a big pot that's bubbling here," Anastasia said.

According to the court documents, after Pacitti offered to wear a wire against the mob in Philadelphia, he changed his mind, but then offered to give troopers information about one of his co-defendants and his ties to a well-known mobster under investigation across the bridge, in New Jersey.

That mobster was Nicky Scarfo Jr., the target of a wide-sweeping FBI probe. Pacitti said he could connect theft ring suspect Todd Stark to Scarfo. Starks' name already surfaced in that case and sources said he could face federal charges.

"This is all part of an ongoing investigation, an ongoing game, and these guys are caught in the middle of it," Anastasia said.

Sources said Pacitti's documented, but unsuccessful offer to help troopers paints him into a corner with both the mob and investigators. It's still unclear how much he really knows.

Stark on the other hand could be feeling the heat. State police said he and his co-defendants remain behind bars on $50,000 bail.

Thanks to Fox 29

Thursday, November 20, 2008

Nicky Scarfo to be Profiled by Biography Channel

FORMER Philadelphia mob boss Nicky Scarfo will be the subject of an hour-long Biography Channel special next month.

"We tried to paint the picture of not only the mobster, but who he was as a person," says Samantha Nisenboim, associate producer for Chicago's Towers Productions, which is behind the special. "That was difficult because he kept his personal life so private."

"Little Nicky," who's now 79, is a guest of the U.S. Penitentiary in Atlanta and did not participate in the special, which airs at 9 p.m. on Dec. 19. "We reached out to Nicky Scarfo, but the federal penitentiary intervened and wouldn't let him know," Nisenboim said last night.

Retired Philadelphia police captain Frank Friel, retired FBI agents Michael Leyden and James Darcy, and retired federal prosecutor Lou Pichini are among those who were interviewed for the special. An unidentified mob associate is also interviewed as were South Philadelphia author/historian Celeste Morello, who wrote the "Before Bruno" series about the Philly mob, and Inquirer reporter George Anastasia, who has written several books about Scarfo and the mob.

Sunday, October 19, 2008

Mob Strike Force Will Remain Intact to Confront Gangsters Returning from Prison

Recently there's been more intrigue about the fate of the U.S. Organized Crime Strike Force than about mob plots in Philadelphia.

Well, the strike force has dodged a bullet, sort of.

Officials of the U.S. Attorney's Office said Friday that strike-force prosecutors would be devoted to organized crime - La Cosa Nostra and emerging ethnic groups from Russia, Asia, the Middle East and elsewhere. They will not be interchangeable with drug prosecutors, officials said.

The deal was worked out between the U.S. Attorney's Office and the Justice Department in recent days. And it comes not a moment too soon, as dozens of mobsters are returning home from prison.

Last Wednesday, Assistant U.S. Attorney David Fritchey underwent a proper moblike introduction to the cappi di tutti in Washington, D.C.

"This is Dave from Philly. He's a friend of ours," joked Fritchey, about his own introduction as the newly appointed chief of the strike force here.

The Boss of all Bosses, Matthew W. Friedrich, the acting assistant attorney general of the Criminal Division at the Justice Department, blessed Fritchey as chief and preserved the nine-prosecutor unit as part of his special-strike-force duties.

Fritchey, a longtime mob prosecutor, takes over the prestigious strike force, which put scores of mobsters behind bars during the reigns of several mob bosses, from Nicodemo "Little Nicky" Scarfo in the '80s to Joseph "Skinny Joey" Merlino in '01. "I expect to do long-term projects and quick-hitting ones in real time," said Fritchey.

Robert Reed, deputy chief of the Criminal Division in the U.S. Attorney's Office, said that he hopes for "cross-pollination" between the drug unit and strike force, now located next to each other after a move over the weekend.

"I think highly of Fritchey as a prosecutor. He's a very independent guy," said Louis Pichini, retired strike-force attorney and former chief of the Criminal Division. "But how much independence will he have?"

If strike-force attorneys had to try a tsunami of drug prosecutions as earlier suggested, retired prosecutors and investigators said, they would not have time to attack the most complicated organized-crime cases.

Nor could they monitor nearly 30 mobsters released from prison since the early 1980s, or others who pose threats to society, they said.

Recently, an intelligence analyst who studied organized-crime activities to find links among them was transferred to the terrorism unit.

"I strongly disagree with the dilution of the program," said Joel M. Friedman, strike-force chief for 22 years, now working with retired FBI director Louis J. Freeh's consulting firm, Freeh Group International.

"This is one of the most violent LCN [La Cosa Nostra] families in America," Friedman said. "They swear an oath to protect the family. They are getting out [of prison] and will reconstitute the family."

James T. Maher, retired FBI supervisor of the organized-crime unit, is so concerned that he still keeps track of mobsters coming home.

Last March, Vincent "Big Vince" Filipelli, 54, a bodyguard and enforcer for mob boss John Stanfa in the 1990s, was sent back to prison to serve a 66-month sentence for extortion. The "made" member earlier served a 54-month sentence for racketeering extortion in the Stanfa era.

In 2001, mobster Martin Angelina, 45, was convicted of racketeering with Merlino and served a 54-month prison sentence. Last year, Angelina was caught associating with mobsters and returned to prison for four months. And he may be in trouble again - he has a hearing tomorrow on a related matter.

Tomorrow, Thomas R. Perricone will be named deputy chief of the Criminal Division in charge of drugs and organized crime, and Faith Taylor will be named chief of the narcotics unit.

Thanks to Kitty Caparella

Wednesday, September 17, 2008

Merging of Federal Organized Crime Strike Force Into Narcotics Unit Questioned by Former Prosecutors

The Organized Crime Strike Force, a prosecuting unit within the U.S. Attorney's Office that has a 20-year record of success in making cases against the Philadelphia mob, is being folded into a larger unit that will also focus on drug dealing and gang violence.

The changes are expected to take place in about a month, according to Laurie Magid, the acting U.S. attorney for the Eastern District of Pennsylvania, and Linda Hoffa, head of the office's Criminal Division. Both said the move would enhance the unit's ability to make cases.

Critics, including former prosecutors and FBI agents, said the consolidation could hinder the development of intelligence-based investigations and marginalize the fight against organized crime.

Magid said she wanted the same expertise that has been used against organized crime employed in cases against major drug gangs.

"Our commitment to fighting organized crime is in no way diminished," she said yesterday shortly after announcing the changes at a regularly scheduled staff meeting.

Magid, the former first assistant U.S. attorney, was named interim head of the office in July when Patrick Meehan, her boss, resigned.

"The strike force is not being disbanded," added Hoffa. "Far from it. We're putting together a stronger and larger team."

Nine federal prosecutors who work in the strike force unit are being transferred to new offices and will report to Thomas Perricone, currently the supervisor of the narcotics and dangerous drugs section. Perricone, who joined the U.S. Attorney's Office in 1994 from the Philadelphia District Attorney's Office, will head a newly formed narcotics and organized crime section.

Assistant U.S. Attorney David Troyer, who was the supervisor of the strike force, will return to prosecuting cases under Perricone and will hold one of two senior litigation counsel posts created under the new structure. Troyer declined to comment last week.

Two former prosecutors who worked some of the biggest mob cases in Philadelphia history questioned the move, as did James Maher, a retired FBI agent who supervised an organized crime squad that in the 1980s and 1990s worked with the strike force to decimate one of the most violent Mafia families in America.

"That wasn't by chance, it was because of the commitment," said Barry Gross, a former federal prosecutor who worked dozens of mob cases during a career that spanned three decades.

A member of the prosecuting teams that convicted mob bosses Nicodemo "Little Nicky" Scarfo, John Stanfa, Ralph Natale and Joseph "Skinny Joey" Merlino, Gross said he was "surprised and disappointed" by the change.

Louis Pichini, a former strike force prosecutor who directed the 1988 racketeering prosecution of Scarfo and 16 of his top associates - a case that gutted the local mob family - said "the acid test will be in the implementation" of the proposed changes.

Pichini, who also headed the criminal division before leaving the U.S. Attorney's Office, said it was important for "the unit to maintain an identity and expertise" and to be given the time to develop long-term cases.

If not, he said, prosecutors working there would be interchangeable with prosecutors from any other section, and the expertise and mandate of the strike force would be lost.

Strike forces were set up in the 1970s to develop broad-based cases and intelligence in the fight against traditional organized crime groups like La Cosa Nostra and the Sicilian Mafia. Over the years, their targets have been expanded to include Russian and Eastern European crime cartels, Asian criminal organizations, and ethnic gangs like the Latin Kings.

In the Eastern District, the strike force left its biggest mark attacking the South Philadelphia-based mob that once dominated the local underworld.

Perricone said yesterday that he had "tremendous respect" for those accomplishments.

"Having grown up in South Philadelphia and seeing what the mob can do, I can tell you that not on my watch will I allow resources to be taken away," he said. But critics question whether what is being called an expansion is in fact a dilution of a unit that had a clear agenda and a defined focus.

One current federal prosecutor, who asked not to be identified, said that without a supervisor to advocate and promote strike force cases, investigations could get bogged down or marginalized in the internal politics and bureaucracy of the U.S. Attorney's Office.

Sources in both the U.S. Attorneys Office and the FBI have said that an ongoing investigation into reputed mob boss Joseph Ligambi and his top associates had gone "off track" twice because of bureaucratic squabbling.

Maher, who headed the FBI's organized crime squad in Philadelphia for nearly two decades, called the strike force "one of the most important weapons" in the war against organized crime. "Agents working the cases had attorneys who spoke the same language," Maher said in an e-mail response to questions about the consolidation.

He pointed out that the local mob family is built around "people who have grown up with one another in evolving relationships. ... To combat those relationships, you need agents and attorneys who don't need to learn them all over again when a case starts to develop."

Strike forces were once separate entities from U.S. Attorney's Offices. They were consolidated into those offices but remained separate units. Now they may be the victims of their own successes as well as the changing priorities of the Justice Department.

Traditional organized crime has taken a series of prosecutorial hits in most major cities and experts say that the American Mafia in 2008 is an organizational shell of what it was just 30 years ago.

In addition, the emergence of violent ethnic drug gangs, the proliferation of illegal weapons, and the need to focus on terrorism and its related threats have led federal prosecutors in other cities to reassign assets and resources, and consolidate strike force operations.

Thanks to George Anastasia



Friday, October 12, 2007

A Look Back at the Philly Mob

Pop culture is riddled with more mob movies and TV shows than an unlucky gangster's body is with bullets. Americans are fascinated with the dark side and have made “The Sopranos” the poster children for the Mafia and Victoria Gotti, daughter of John “The Dapper Don” Gotti, and her spoiled-rotten offspring its royal family with the reality show “Growing Up Gotti.”

But contrary to what pop culture loves to portray, the mob is far from glamorous and exciting. Just take a look at where Cosa Nostra — Sicilian for “our thing” — landed South Philly's own tough guys, all of whom made headlines at one point or another: Angelo “The Gentle Don” Bruno, Phil “Chicken Man” Testa and his son Salvatore Testa got whacked, while Nicodemo “Little Nicky” Scarfo, John Stanfa, Ralph Natale, “Skinny” Joey Merlino and Ron Previte are all in prison for racketeering and murder among other offenses,

George Anastasia, who has written extensively about the mob for The Philadelphia Inquirer since the late 1970s and authored four bookson the subject, noted, “If you look at the list, you see where these guys have ended up,” Anastasia, a native of the 1700 block of Watkins Street who now lives in South Jersey, told the Review.

Bruno was the longest running crime boss and perhaps one of the most respected for the low-key approach that earned him his nickname.

Bruno ruled from '59 to March 21, 1980, when he was shot to death in his car with driver John Stanfa in front of Bruno's home at 934 Snyder Ave. Under the Sicilian immigrant's tenure, “he did everything low-key — he didn't do any public shootings in restaurants or in the street” unlike how later-day mobsters such as the ruthless Scarfo conducted business, Capt. Charles Bloom of the police department's Central Intelligence Bureau said. “If you had to describe Bruno, you could say, ‘make money, don't make headlines,'” Bloom said.

His attitude in life did not mark his death. His violent end received press from outlets such as The New York Times, which covered the fallout from Stanfa's trial for perjury in connection to the killing to FBI testimony in '81 that Scarfo was the new head of the family.

Stanfa suffered a graze wound in the Bruno ambush, Anastasia said, adding, “To this day there's conflicting reports. Some people believe Stanfa was part of the plot and he knew what was going to happen and others say he didn't. I tend to believe the former.”

Under Bruno's reign, the Philadelphia crime family was among the most powerful in the United States, trailing closely being New York and Chicago. The Gentle Don carved out a close relationship with Carlo Gambino, leader of New York's family — a friendship that saved Bruno when short-lived Philly boss Antonio Pollina wanted him killed in '59.

As the story goes, Bruno pledged his loyalty to Pollina despite being passed over for the job, but the new boss still felt threatened. When Pollina ordered a hit, Gambino intervened by not only halting the slaying, but putting his new friend in charge of the Philadelphia crime family. The first notch in Bruno's belt of civility was sparing Pollina.

According to Bloom, the Philly mob, which controlled this city and South Jersey including Atlantic City, has always been in New York's shadow and the former often cannot operate without the latter's blessing.

Bruno's death at 69 paved the way for a slew of flamboyant, young wiseguys to take the helm. “That totally destabilized the organization and it's been destabilized since then. It's been disorganized organized crime,” Anastasia said.

The new guns included Bruno underling Testa, who was blown up March 15, 1981, on his front porch on the 2100 block of Porter Street in Girard Estate by a nail bomb and later immortalized in Bruce Springsteen's song “Atlantic City,” whose lyrics say, “Well they blew up the Chicken Man in Philly last night/Now they blew up his house too.” The song, featured on the Boss' “Nebraska” album, which made it to No. 3 on the U.S. Billboard Pop Album charts, brought the scene to the attention of countless music fans worldwide.

More than 20 years later, Testa's fatal bombing is still making news. An Oct. 7 Time article cited the killing in its piece “The Sicilian Connection,” which explores the U.S. Cosa Nostra's alleged link to the Sicilian Mafia.

Months after the Chicken Man's demise, Scarfo had Frank Narducci and Rocco Marinucci whacked for the unauthorized hit of his mentor, according to Anastasia.

Long before he ascended to power, Scarfo was banished to AC by Bruno in the '60s after the young hothead knifed a man inside Oregon Diner, 302 W. Oregon Ave, the writer said. Scarfo stayed in AC — a wasteland at the time — but hung around long enough to benefit from gambling when the casinos hit town.

With Testa gone, Scarfo took over in '81 and made Testa's son Salvatore a capo. That same year, Testa and two others survived an ambush outside the Italian Market, but three years later, the capo wasn't as lucky when Scarfo had the young man killed Sept. 14, 1984. So much for loyalty to his mentor — he had his son killed, Anastasia said, adding, “That's the way he was.”

Testa was lured to a now-gone candy store on Passyunk for a meeting, where a Scarfo hit man shot him, wrapped his body in a rug and dumped it by a dirt road in Gloucester County, N.J., the writer said. Scarfo told his organization he had Testa killed because he broke off an engagement with Salvatore Merlino's daughter, Maria, but according to Anastasia, Scarfo saw Testa as a possible threat. “He used the broken engagement as an excuse,” the author said. In years to come, Merlino's son Joey would become a reputed mob boss.

Scarfo held control for six years until his arrest and conviction for a racketeering case that included counts of murder, Anastasia said. Little Nicky got 55 years and remains in the Big House. But his impression was indelible. In a '91 Time interview with former soldier-turned-informer Nicholas “The Crow” Caramandi, interviewer Richard Behar refers to Scarfo as the “most vicious Mob boss of his generation” and proceeds to ask Caramandi about working under him, as well as the killing of Salvatore Testa.

In '89, Bruno's former driver Stanfa, who grew up on Passyunk Avenue near the Melrose Diner and later moved to Jersey, became boss. In '95, he got five life terms for racketeering and murder.

That opened the way for Natale. After serving 15 years for drug dealing and arson, Natale was released in '95 and became boss in an alliance with Merlino, who was his underling, Anastasia said. Merlino associate Previte helped build a case against Natale by wearing a wire for the feds. The tapes resulted in the then-69-year-old Natale and then-37-year-old Merlino arrested on drug charges in '99 with Natale tied to a major South Jersey meth ring and Merlino to a Boston cocaine ring. Natale became the first mobster to cooperate with the feds and, as a result, got a 13-year sentence, which he's serving in a protected witness wing, Anastasia said.

That leaves Merlino, who by all appearances may be one of Philadelphia Cosa Nostra's last bad boys.

Despite the feds pursuing him aggressively for years, the style-conscious young turk with the striking wife did not shy away from the media, becoming a magnet for his organized softball league and Christmas parties for the poor. In typical Merlino fashion, his 2001 trial on murder and racketeering charges was a press event. And, he may have beaten the rap for Joseph Sodano's '96 murder in Philadelphia court, but a federal judge in New Jersey upheld charges in the same case against the reputed mob boss in October 2001. The New York Times, among other national and international papers, covered the trial.

Merlino and seven codefendants — including Previte — were convicted of bookmaking, racketeering and extortion. These days, “Skinny Joey” is serving a 14-year sentence, set to be released in '11, Anastasia said.

The reigning alleged crime boss has been identified as 68-year-old Joe Ligambi, who was with the Stanfa organization. In '89, Ligambi was sent away for 10 years after being convicted of murder, which was overturned on appeal. Ligambi came back to South Philly in '99 and, when Merlino went to jail, became acting boss, Anastasia said. According to the author, “he's kind of gone back to the Bruno model of low-key, not flashy.”

Bloom contends Cosa Nostra is still very much alive and well. “It's not as powerful as it was 20 years ago but it's still there. They haven't gone away. They took a lot of hits from law enforcement pressure and each other, but they didn't throw in the towel,” the captain said.

Thanks to Lorraine Gennaro

Sunday, December 03, 2006

Roving Bug in Cell Phones Used By FBI to Eavesdrop on Syndicate

The FBI appears to have begun using a novel form of electronic surveillance in criminal investigations: remotely activating a mobile phone's microphone and using it to eavesdrop on nearby conversations.

The technique is called a "roving bug," and was approved by top U.S. Department of Justice officials for use against members of a New York organized crime family who were wary of conventional surveillance techniques such as tailing a suspect or wiretapping him.

Nextel cell phones owned by two alleged mobsters, John Ardito and his attorney Peter Peluso, were used by the FBI to listen in on nearby conversations. The FBI views Ardito as one of the most powerful men in the Genovese family, a major part of the national Mafia.

The surveillance technique came to light in an opinion published this week by U.S. District Judge Lewis Kaplan. He ruled that the "roving bug" was legal because federal wiretapping law is broad enough to permit eavesdropping even of conversations that take place near a suspect's cell phone.

Kaplan's opinion said that the eavesdropping technique "functioned whether the phone was powered on or off." Some handsets can't be fully powered down without removing the battery; for instance, some Nokia models will wake up when turned off if an alarm is set.

While the Genovese crime family prosecution appears to be the first time a remote-eavesdropping mechanism has been used in a criminal case, the technique has been discussed in security circles for years. The U.S. Commerce Department's security office warns that "a cellular telephone can be turned into a microphone and transmitter for the purpose of listening to conversations in the vicinity of the phone." An article in the Financial Times last year said mobile providers can "remotely install a piece of software on to any handset, without the owner's knowledge, which will activate the microphone even when its owner is not making a call."

Nextel and Samsung handsets and the Motorola RAZR are especially vulnerable to software downloads that activate their microphones, said James Atkinson, a counter-surveillance consultant who has worked closely with government agencies. "They can be remotely accessed and made to transmit room audio all the time," he said. "You can do that without having physical access to the phone."

Because modern handsets are miniature computers, downloaded software could modify the usual interface that always displays when a call is in progress. The spyware could then place a call to the FBI and activate the microphone--all without the owner knowing it happened. (The FBI declined to comment on Friday.)

"If a phone has in fact been modified to act as a bug, the only way to counteract that is to either have a bugsweeper follow you around 24-7, which is not practical, or to peel the battery off the phone," Atkinson said. Security-conscious corporate executives routinely remove the batteries from their cell phones, he added.

The FBI's Joint Organized Crime Task Force, which includes members of the New York police department, had little luck with conventional surveillance of the Genovese family. They did have a confidential source who reported the suspects met at restaurants including Brunello Trattoria in New Rochelle, N.Y., which the FBI then bugged. But in July 2003, Ardito and his crew discovered bugs in three restaurants, and the FBI quietly removed the rest. Conversations recounted in FBI affidavits show the men were also highly suspicious of being tailed by police and avoided conversations on cell phones whenever possible.

That led the FBI to resort to "roving bugs," first of Ardito's Nextel handset and then of Peluso's. U.S. District Judge Barbara Jones approved them in a series of orders in 2003 and 2004, and said she expected to "be advised of the locations" of the suspects when their conversations were recorded.

Details of how the Nextel bugs worked are sketchy. Court documents, including an affidavit (p1) and (p2) prepared by Assistant U.S. Attorney Jonathan Kolodner in September 2003, refer to them as a "listening device placed in the cellular telephone." That phrase could refer to software or hardware.

One private investigator interviewed by CNET News.com, Skipp Porteous of Sherlock Investigations in New York, said he believed the FBI planted a physical bug somewhere in the Nextel handset and did not remotely activate the microphone. "They had to have physical possession of the phone to do it," Porteous said. "There are several ways that they could have gotten physical possession. Then they monitored the bug from fairly near by." But other experts thought microphone activation is the more likely scenario, mostly because the battery in a tiny bug would not have lasted a year and because court documents say the bug works anywhere "within the United States"--in other words, outside the range of a nearby FBI agent armed with a radio receiver.

In addition, a paranoid Mafioso likely would be suspicious of any ploy to get him to hand over a cell phone so a bug could be planted. And Kolodner's affidavit seeking a court order lists Ardito's phone number, his 15-digit International Mobile Subscriber Identifier, and lists Nextel Communications as the service provider, all of which would be unnecessary if a physical bug were being planted.

A BBC article from 2004 reported that intelligence agencies routinely employ the remote-activiation method. "A mobile sitting on the desk of a politician or businessman can act as a powerful, undetectable bug," the article said, "enabling them to be activated at a later date to pick up sounds even when the receiver is down."

For its part, Nextel said through spokesman Travis Sowders: "We're not aware of this investigation, and we weren't asked to participate."

Other mobile providers were reluctant to talk about this kind of surveillance. Verizon Wireless said only that it "works closely with law enforcement and public safety officials. When presented with legally authorized orders, we assist law enforcement in every way possible."

A Motorola representative said that "your best source in this case would be the FBI itself." Cingular, T-Mobile, and the CTIA trade association did not immediately respond to requests for comment.

This isn't the first time the federal government has pushed at the limits of electronic surveillance when investigating reputed mobsters. In one case involving Nicodemo S. Scarfo, the alleged mastermind of a loan shark operation in New Jersey, the FBI found itself thwarted when Scarfo used Pretty Good Privacy software (PGP) to encode confidential business data. So with a judge's approval, FBI agents repeatedly snuck into Scarfo's business to plant a keystroke logger and monitor its output. Like Ardito's lawyers, Scarfo's defense attorneys argued that the then-novel technique was not legal and that the information gleaned through it could not be used. Also like Ardito, Scarfo's lawyers lost when a judge ruled in January 2002 that the evidence was admissible.

This week, Judge Kaplan in the southern district of New York concluded that the "roving bugs" were legally permitted to capture hundreds of hours of conversations because the FBI had obtained a court order and alternatives probably wouldn't work.

The FBI's "applications made a sufficient case for electronic surveillance," Kaplan wrote. "They indicated that alternative methods of investigation either had failed or were unlikely to produce results, in part because the subjects deliberately avoided government surveillance."

Bill Stollhans, president of the Private Investigators Association of Virginia, said such a technique would be legally reserved for police armed with court orders, not private investigators.

There is "no law that would allow me as a private investigator to use that type of technique," he said. "That is exclusively for law enforcement. It is not allowable or not legal in the private sector. No client of mine can ask me to overhear telephone or strictly oral conversations."

Surreptitious activation of built-in microphones by the FBI has been done before. A 2003 lawsuit revealed that the FBI was able to surreptitiously turn on the built-in microphones in automotive systems like General Motors' OnStar to snoop on passengers' conversations.

When FBI agents remotely activated the system and were listening in, passengers in the vehicle could not tell that their conversations were being monitored.

Malicious hackers have followed suit. A report last year said Spanish authorities had detained a man who write a Trojan horse that secretly activated a computer's video camera and forwarded him the recordings.

Thanks to Declan McCullagh and Anne Broache

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