The Chicago Syndicate
The Mission Impossible Backpack

Tuesday, April 26, 2005

14 Individuals Indicted for Alleged Organized Crime Activities in Operation Family Secrets in Chicago

James Marcello, 63 (Lombard)
Charges: Racketeering conspiracy (RICO); conducting an illegal gambling business; obstructing a criminal investigation; and tax fraud conspiracy

Joseph Lombardo, 75 (Chicago)
Charge: RICO

Michael Marcello, 55 (Schaumburg)
Charges: RICO; conducting an illegal gambling business; obstructing a criminal investigation; and tax fraud conspiracy

Nicholas Ferriola, 29 (Westchester)
Charges: RICO; extortion; and conducting an illegal gambling business

Joseph Venezia, 62 (Hillside)
Charges: Conducting an illegal gambling business; and tax fraud conspiracy

Thomas Johnson, 49 (Willow Springs)
Charges: Conducting an illegal gambling business; and tax fraud conspiracy

Dennis Johnson, 34 (Lombard)
Charge: Conducting an illegal gambling business

Frank Saladino, 59, deceased (Hampshire, Freeport and Rockford)
Charge: RICO

Michael Ricci, 75 (Streamwood)
Charges: RICO; false statements

Frank Schweihs, 75 (Dania, Fla., and Chicago)
Charges: RICO; extortion; and extortionate collection of credit

Anthony Doyle, 60, (Wickenburg, Ariz., and Chicago)
Charge: RICO

Nicholas W. Calabrese, 62 (Chicago)
Charges: RICO

Frank Calabrese Sr., 68 (Oak Brook)
Charges: RICO; extortion; and conducting an illegal gambling business

Paul Schiro, 67 (Phoenix)
Charge: RICO

Sources: U.S. Department of Justice


Infrastructure of Chicago mob

The 14 Operation Family Secrets defendants indicted on racketeering, conspiracy, or gambling charges are part of the Chicago Outfit, which makes money for members and associates through illegal activities.

The chain of command:

BOSS
James Marcello
Leader of the Chicago Outfit, known as "No. 1"


CONSIGLIERE
Provides advice to the Boss

SOTTO CAPO
Second in command, also known as "No. 2," reports to Boss

CAPOS
Street boss/crew leader, reports to sotto capo

  • Frank Calabrese Sr., South Side/26th Street Crew capo, continued criminal activities from jail through Nicholas Ferriola and others.
  • Joseph Lombardo, Grand Avenue Crew capo

FOUR CREWS
Generally given territories throughout Chicago. May include "made men" --trustworthy people--usually of Italian descent, who have murdered for the Outfit.

1. South Side/26th Street or Chinatown

  • Nicholas Ferriola - collected money made by extortion demands from Frank Calabrese.
  • Frank Saladino
  • Nicholas W. Calabrese - a "made man" and brother of Frank Calabrese Sr.

2. Grand Avenue

3. Melrose Park

  • Michael Marcello - kept his jailed brother James informed on activities. Michael operated an illegal video gambling business.

4. Elmwood Park

ASSOCIATES
Assist the Chicago Outfit through criminal enterprise

  • Frank Schweihs - an enforcer, collected and imposed "street tax" for himself and other members.
  • Paul Schiro - a criminal associate of Frank Schweihs and deceased member Anthony Spilotro.
  • Employees of M&M Amusement: Joseph Venezia, Dennis Johnson and Thomas Johnson operated video gambling machines in Cicero, Berwyn.

Retired Chicago Cops

  • Michael Ricci - a retired Chicago police officer, assisted Frank Calabrese by delivering messages to crew members, collecting money generated by extortion demands and providing false information to FBI.
  • Anthony Doyle - a retired Chicago police officer, who tipped off Frank Calabrese Sr. of law enforcement investigations into the murder of John Fecarotta and whether individuals cooperated with police about mob activities.


Source: U.S. Department of Justice



U.S. drops hammer on who's who of mob: Charges range from murder to racketeering #FamilySecrets

Federal agents pinned decades of gangland killings on Chicago-area mobsters Monday, charging a dozen organized crime figures and two former police officers with running an outfit based on illegal gambling, loan sharking and murder.

In a city where mob hits are rarely solved, prosecutors charged La Cosa Nostra bosses and "made" members alike in connection with 18 slayings dating to 1970.

The killings were some of Chicago's most notorious, including the 1986 beating deaths of Anthony and Michael Spilotro, whose bodies were found in a shallow grave in an Indiana field.

Moving out across Chicago and two other states early Monday, agents swept up numerous career mobsters. They arrested James Marcello, 63, the reputed boss of the local mob, at his Lombard home.

Agents were still searching for two of those charged Monday night, including Joey "The Clown" Lombardo, 75, once the reputed boss of Chicago's mob.

One alleged mob hit man--Frank Saladino--was found dead in a Kane County motel room by the federal agents who came to arrest him Monday morning. He apparently died of natural causes just hours before he was to be picked up, prosecutors said.

At a hearing in federal court, Marcello, identified by Robert D. Grant, FBI special agent-in-charge in Chicago, as the city's top mob boss, and six other defendants were questioned briefly by U.S. District Judge James Zagel before each pleaded not guilty to the charges.

Dressed in light gray sweat pants and shirt, Marcello said he had some sinus allergies in response to a question about his health. He was ordered held for a bond hearing later this week.

All told, the charges amounted to an unprecedented attack on the local Outfit. "This is the first indictment that I can recall that involves so many murders, which really gets to the heart of what the [La Cosa Nostra] is, and that is a bunch of murderous thugs," Grant said.

At a packed news conference, U.S. Atty. Patrick J. Fitzgerald identified the alleged participants in only one murder, saying Frank Calabrese Sr. and his brother, Nicholas, were charged with taking part in the slaying of John Fecarotta, a mob enforcer who reportedly was killed for botching the burial of the Spilotros.

A key break in the probe came after Nicholas Calabrese was confronted with DNA evidence that allegedly implicated him in the Fecarotta homicide. Calabrese then agreed to cooperate with law enforcement and fingered his brother and others in many of the killings, according to law enforcement sources.

It was the squabbling within the Calabrese family that led police to name the investigation "Operation Family Secrets."

Authorities said the lengthy investigation solved some brutal mob murders:

  • Daniel Seifert, slain in 1974 before he could testify against Lombardo and others;
  • William Dauber, a top Outfit enforcer, and his wife, who were gunned down in 1980 on a rural Will County road.
  • William "Butch" Petrocelli, a reputed mob hit man who was killed in 1980 for allegedly stealing money.

In a surprise, Fitzgerald threw in a twist into the well-known story of the Spilotro brothers slayings, saying the men were killed in DuPage County. A 1986 autopsy had reportedly found dirt in the brothers' lungs, leading authorities at the time to believe the men had been buried alive in the Indiana cornfield where their bodies were later found.

Grant said the indictment delivers a significant blow to the Chicago Outfit, though not a fatal one. The FBI believes the Chicago mob has four street crews operating in the Chicago area--down from six--and estimates its members and associates at more than 100, Grant said.

In another wrinkle to the indictment, two retired Chicago police officers, Anthony Doyle and Michael Ricci, were charged with passing messages from the imprisoned Frank Calabrese Sr. to other Outfit members in a bid to find out if Nicholas Calabrese or another mob associate was cooperating with the FBI.

Doyle also allegedly tipped off Frank Calabrese Sr. that the FBI had pulled the file on the Fecarotta murder. Ricci, who was employed by the Cook County sheriff's department when he allegedly relayed messages, was also accused of lying to FBI agents.

The indictment charged six of the men with committing murder on behalf of the outfit: Marcello, Lombardo, both Calabreses, Paul Schiro and Frank Saladino. In addition, Frank "German" Schweihs, an Outfit enforcer, allegedly agreed to commit murder for the mob.

Also charged with racketeering conspiracy but not in connection with any murders were Marcello's brother, Michael; Nicholas Ferriola, son of the late reputed mob boss Joseph Ferriola; Doyle and Ricci.

The racketeering conspiracy count charged the 11 defendants also illegally collected "street tax," ran illegal sports bookmaking and video gambling businesses, made "juice loans" at extortionate rates and used extortion, threats and violence to collect the juice loans and other debts.

Authorities are seeking forfeiture of $10 million in illicit profits from those 11 defendants.

In addition, Michael Marcello, who owns Cicero-based M & M Amusement Inc., as well as his brother and three M & M employees--Joseph Venezia and Thomas and Dennis Johnson--were charged with conducting an illegal video gambling business since 1996.

Authorities said all but Lombardo, 75, of Chicago and Schweihs, 75, of Dania, Fla., were taken into custody Monday.

At an arraignment in federal court in Chicago, the Marcellos, Ricci, Ferriola, both Johnsons and Venezia all pleaded not guilty to the charges.

Schiro is in federal prison for a conviction for taking part in a sophisticated jewelry theft ring headed by William Hanhardt, a former Chicago police chief of detectives.

All but the two Marcellos were released on $50,000 bails each. Prosecutors said they intend to seek the Marcellos' detention, saying they pose dangers to the community and flight risks. Zagel scheduled a bond hearing for Friday.

The FBI's Grant said he considers Lombardo and Schweihs fugitives--a claim scoffed at by Lombardo's lawyer, Rick Halprin.

"I can't imagine Joey Lombardo running from anything, and that certainly includes an indictment," Halprin said.

James Marcello's lawyer, Marc Martin, called the indictment "vague."

"I cannot discern from it what my client is alleged to have done," he said.

Attorney Joseph Lopez, who represents Frank Calabrese Sr., said his client, who is in prison on a 1997 conviction for using violence to collect several million dollars in "juice" loans, hadn't yet learned of the indictment. "I'm sure he's like any other person who has a family member saying bad things against him," Lopez said in reference to the cooperation by brother Nicholas Calabrese.

Monday's indictment marks a milestone for law enforcement, which has long been frustrated by the secretive and violent Chicago Outfit and its ruthless effectiveness in silencing witnesses.

According to the Chicago Crime Commission, only 14 of 1,111 Chicago-area gangland killings since 1919 have ended in convictions.

The first major break came about five years ago when Frank Calabrese Sr.'s son, Frank Jr., who long had strained relations with his father, provided information to law enforcement when they were themselves being released from federal prison, according to a source familiar with the investigation. He also cooperated against his uncle, reputed mob hit man Nicholas Calabrese.

Realizing that Fecarotta's hit man had been shot in a struggle and bled, investigators sought Nicholas Calabrese's DNA and an X-ray of his arm.

Nicholas Calabrese's DNA matched blood found at the crime scene and in a Buick that was used for the hit, linking him to the murder, according to the source. And the X-ray showed that Calabrese had evidence of a long-ago injury, a through-and-through bullet wound in his forearm, the source said.

Confronted with the evidence, Nicholas Calabrese began spilling his family's secrets, according to law enforcement sources.

Authorities have also gathered additional information from court-authorized wiretaps at a federal prison in Michigan, sources said.

Lombardo, whose DNA was swabbed by investigators in early 2003, took out an ad to publicly swear off any mob ties after being released from prison in 1992.

When a reporter pointed that out to Fitzgerald, he said, "You can take an ad out in the paper; it doesn't stop an indictment if we have sufficient evidence to indicate otherwise. Otherwise, you guys would have lots of ads in about a week."

- - -

14 individuals indicted for alleged organized crime activities

James Marcello, 63 (Lombard)
Charges: Racketeering conspiracy (RICO); conducting an illegal gambling business; obstructing a criminal investigation; and tax fraud conspiracy

Joseph Lombardo, 75 (Chicago)
Charge: RICO

Michael Marcello, 55 (Schaumburg)
Charges: RICO; conducting an illegal gambling business; obstructing a criminal investigation; and tax fraud conspiracy

Nicholas Ferriola, 29 (Westchester)
Charges: RICO; extortion; and conducting an illegal gambling

Joseph Venezia, 62 (Hillside)
Charges: Conducting an illegal gambling business; and tax fraud conspiracy

Thomas Johnson, 49 (Willow Springs)
Charges: Conducting an illegal gambling business; and tax fraud conspiracy

Dennis Johnson, 34 (Lombard)
Charge: Conducting an illegal gambling business

Frank Saladino, 59, deceased (Hampshire, Freeport and Rockford)
Charge: RICO

Michael Ricci, 75 (Streamwood)
Charges: RICO; false statements

Frank Schweihs, 75 (Dania, Fla., and Chicago)
Charges: RICO; extortion; and extortionate collection of credit

Anthony Doyle, 60, (Wickenburg, Ariz., and Chicago)
Charge: RICO

Nicholas W. Calabrese, 62 (Chicago)
Charges: RICO

Frank Calabrese Sr., 68 (Oak Brook)
Charges: RICO; extortion; and conducting an illegal gambling

Paul Schiro, 67 (Phoenix)
Charge: RICO

Thanks to Matt O'Connor and Todd Lighty

Officials go after Lifeblood of Chicago Outfit

By targeting mob-owned video gambling and sports bookmaking operations in a grand jury indictment handed down Monday, federal authorities acknowledged the importance of illicit gambling to the Chicago underworld.

"The lifeblood of the Chicago Outfit is illegal gambling and the money and profits that it generates," Byram Tichenor, special agent in charge of the IRS in Chicago, said Monday at a news conference announcing criminal charges against 12 alleged local mobsters and two former police officers.

The indictments offer a unique glimpse into the inner workings of a video gambling ring that netted millions of dollars in proceeds inside bars and private clubs in Cicero and Berwyn over and eight-year period that ended last April.

Authorities did not say how much money was taken in by M&M Amusement Inc. of Cicero, but the business is reportedly very profitable. Proponents of a bill to legalize video gambling in Illinois two years ago estimated the state could rake in $375 million from the 47,000 machines operating in the state.

M&M Amusement, operated by James Marcello and his brother Michael Marcello, allegedly installed an unspecified number of video gambling machines inside Cicero and Berwyn bars, restaurants and fraternal clubs beginning in January 1996.

To the uninitiated or outsiders, these machines were just time-killing amusements like a pinball machine or jukebox. But to bar regulars and other trusted people, the video gambling machines allowed players to accrue electronic credits that could be cashed in for real dollars, the indictment alleges.

Two indicted M&M Amusement employees, Joseph Venezia and Thomas Johnson, allegedly taught bar, restaurant and fraternal group representatives how to pay off winners and how to clear accumulated credits off the machines after the cash payments were made, the indictment alleges.

Venezia and Johnson further "warned the owners, managers and representatives only to pay money to winning customers whom they knew well, and to beware of law enforcement efforts," the indictment says. "Those customers who were not known were to be told that the video gambling machines were for amusement only."

Electronic counters inside the machines kept track of the number of games played, winning credits accrued and total number of credits cleared off each machine. M&M Amusement allegedly divided the proceeds from the machines with bars, restaurants and fraternal groups and reimbursed them for payouts.

The federal indictment does not indicate exactly how much money M&M took in between January 1996 and April 2004, but officials are seeking the forfeiture of $10 million from the defendants. Officials are also seeking to seize M&M Amusement's Cicero office building, which is owned by Michael Marcello.

Authorities gave few details about a sports bookmaking operation allegedly run between 1992 and 2001 by defendants Frank Calabrese Sr. and Nicholas Ferriola. The indictments state it was run in northern Illinois, involved five or more people and was in continuous operation for more than 30 days.

According to previous court filings, M&M Amusement served 44 clients, primarily in the west suburbs. A listing of the customers was found on the body of mobster Anthony Chiaramonti after he was gunned down in Lyons in 2001. Several of the customers were called before the grand jury that handed down Monday's indictment.

According to the previous court filing, one video poker customer said he received between $150 and $400 a week from his machines.

No one answered the door Monday at M&M Amusement's 5533 W. 25th St. property, where there are no business signs. A neighbor said he has not seen anyone working at the property since December.

Thanks to Brett McNeil, Ray Gibson, and Matt O'Connor


`Clown' Missing from Mob: Joseph Lombardo Vanishes

For more than 50 years, Joseph Lombardo has called the West Town neighborhood his home--at least, whenever he wasn't in prison. An early riser, he was often seen since his 1992 release from prison riding his bicycle with a small cigar firmly planted between his lips. But when federal agents went to the 2200 block of West Ohio Street Monday morning to pick him up, Lombardo was nowhere to be found.

Lombardo was one of just two of the indicted members of the mob not under arrest when the Operation Family Secrets charges were announced Monday afternoon.

Lombardo, 76, has known he has been a target for months. His attorney, Rick Halprin, has said Lombardo was being looked at as a suspect in the 1974 slaying of Daniel Seifert. Seifert was a Bensenville businessman scheduled to testify against Lombardo and others in a Teamster pension fund fraud case.

Halprin has said Lombardo was at a Chicago police station at the time of the slaying. "We will have to wait and see," Halprin said of whether his client would surrender.

Halprin doubted Lombardo would be wearing the famous newspaper mask he made after a 1981 court appearance. It was that goofiness, and Lombardo's flair for the theatrical, that led police to give him the nickname "The Clown."

The indictment does not spell out what role Lombardo allegedly played in the killings. "It is pitifully sketchy," said Halprin.

Lombardo has done two stretches in federal prison. He was released in 1992 after serving 10 years on two separate federal convictions. He was convicted of conspiring to bribe U.S. Sen. Howard Cannon of Nevada for help in defeating a trucking deregulation bill and convicted in a mob scheme to skim $2 million from a Las Vegas casino.

Robert Fuesel, who worked organized crime for 28 years for the Internal Revenue Service, said Lombardo was not only the chairman of the board, but also an enforcer. He said he once surrounded Lombardo's house with 10 agents as he hid inside to avoid being served with a subpoena. Fuesel told Lombardo's wife that the agents were not going to leave, and Lombardo came out a half hour later and accepted the subpoena. But Monday morning, Lombardo was nowhere to be found.

Among federal indictments announced Monday were charges related to 18 unsolved murders and one attempted murder between 1970 and 1986.

1 MICHAEL FRANK "HAMBONE" ALBERGO

Date of murder: August 1970

How he was killed: Disappeared

Motive for murder: Albergo was a mob enforcer who vanished after being charged in connection with a loan-shark operation.

In 2003, FBI agents excavated a parking lot near U.S. Cellular Field on a tip that his bones were buried there.

2 DANIEL SEIFERT

Date: Sept. 27, 1974

How killed: Seifert was killed with shotgun blasts ouside his Bensenville factory.

Motive: Seifert was scheduled to testify against Outfit leaders accused of defrauding the Teamsters' pension fund.

3 PAUL HAGGERTY

Date: June 24, 1976 (in Chicago)

How killed: Not available

Motive: Not available

4 HENRY COSENTINO

Date: March 15, 1977

How killed: His body was found in the trunk of a car at the Chicago auto pound.

He had been killed by blunt force to the neck.

Motive: Not available

5 JOHN MENDELL

Date: Jan. 16, 1978

How killed: He was found dead in the trunk of his car in Chicago after being tortured and having his throat slit.

Motive: He was wanted by police following the murder of a member of a burglary ring.

6/7 DONALD RENNO / VINCENT MORETTI

Date: Jan. 31, 1978

How killed: Both men were found in the back of Renno's car in Cicero with their throats cut.

Motive: Police suspect Moretti's burglary ring was fencing goods in Las Vegas against the mob's wishes.

8/9 WILLIAM DAUBER AND CHARLOTTE DAUBER

Date: July 2, 1980

How killed: The Daubers were gunned down as they drove on a rural road in Will County.

Motive: William Dauber, a suspected mob killer, had been arrested on federal drug charges and Outfit leaders were afraid he'd turn informant.

10 WILLIAM "BUTCH" PETROCELLI

Date: Dec. 30, 1980

How killed: He was found in the back seat of his car in Cicero with his throat slashed and his face burned.

Motive: Outfit leaders reportedly suspected Petrocelli of skimming collection money and shaking down robbers without permission.

11 MICHAEL CAGNONI

Date: June 24, 1981

How killed: A radio-controlled bomb beneath his car exploded as he drove on a tollway ramp at Ogden Avenue and I-294 in DuPage County.

Motive: Sources said he supervised the mob's produce hauling operations and was suspected of holding back some of the profits.

12 NICHOLAS D'ANDREA

Date: Sept. 13, 1981

How killed: He was found murdered in the trunk of his car in Chicago Heights.

Motive: Mob associates suspect he was involved in arranging a hit on mob figure Alfred Pilotto.

13/14 RICHARD D. ORTIZ / ARTHUR MORAWSKI

Date: July 23, 1983

How killed: Both men were shot to death while sitting in a car outside a Cicero bar owned by Ortiz.

Motive: Not available

15 EMIL VACI

Date: June 7, 1986

How killed: He was found shot in the head in a drainage ditch in Phoenix.

Motive: Weeks before his death he appeared before a grand jury investigating the Spilotro brothers in Las Vegas.

16/17 ANTHONY SPILOTRO AND MICHAEL SPILOTRO.

Date: June 14, 1986

How killed: The brothers were beaten, and buried in a shallow grave in a northwest Indiana cornfield.

Motive: Mob bosses allegedly were not happy with how Anthony Spilotro, an Outfit enforcer, was running operations in Las Vegas.

18 JOHN FECAROTTA

Date: Sept. 14, 1986

How killed: Fecarotta, a longtime mob muscleman, was gunned down outside a bingo hall on Belmont Avenue.

Motive: An informant later told federal agents Fecarotta was killed for botching the burials of the Spilotros.

Note: Charges also include the attempted murder of an unnamed victim in Lake County on April 24, 1982.


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