85 Year Old Denied Release from Custody in Reputed Mob Pipe Bombing Case

A federal judge today refused to release from custody an elderly Oak Brook man charged with the Outfit-related pipe-bombing of a video gambling machine business.

U.S. Magistrate Judge Sidney Schenkier said he believes 85-year-old Samuel Volpendesto has serious health problems but found the risk of flight was too great to release him from the Metropolitan Correctional Center downtown.

Volpendesto is charged in a case that links the Chicago mob and the Outlaws motorcycle gang to the pipe bombing of a Berwyn business that was in competition with the Outfit. Reputed mobster Michael "the Large Guy" Sarno also was indicted in the case.

Nathan Diamond-Falk, Volpendesto's lawyer, argued his client is suffering at the MCC from bladder cancer and an infection from a cut he sustained in the spring. It would be a life sentence for Volpendesto to remain jailed before a trial, Diamond-Falk said.

Assistant U.S. Atty. Markus Funk told the judge Volpendesto looked vigorous in court before the hearing started and was "acting like a clown, frankly." Volpendesto can be heard on secretly made tapes in the case linking himself to the Outfit and the 2003 bombing, Funk said.

At different points in one recording, Funk said, Volpendesto bragged about working for mobsters with ties to legendary Outfit boss Al Capone and claimed he also worked for the late mob boss Sam Giancana.

At Funk's request, a jail official informed the court about Volpendesto's ongoing medical treatment at the MCC.

Schenkier ultimately rejected Volpendesto's request, noting the crime was very serious and suggesting that despite the fact Volpendesto is confined to a wheelchair, he could still flee and not be available to have his case heard by a jury.

That could be his choice, Schenkier said, or the choice of the Outfit if the mob perceived Volpendesto could help the government. "He might have assistance in not being around at trial," the judge said.

Thanks to WGN

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Antoinette "The Mafia Princess" Giancana To Open Mob Museum in Las Vegas

The "Mafia Princess" is moving to Las Vegas to help open a mob-themed exhibit.

Antoinette Giancana, daughter of murdered Chicago mob chief Sam Giancana, was in Las Vegas over the weekend for meetings with backers of the museum, which is planned for a Strip location. It would compete with a $50 million downtown mob museum being pushed by Mayor Oscar Goodman.

She's partnering with local investors Jay Bloom and Charlie Sandefur, who reportedly are in negotiations with Strip properties for their venue.

"There would be tremendous foot traffic," she said by phone Tuesday. "I think it's going to be dynamite. Jeez," she paused, adding, "I shouldn't use that word."

Her 1984 book was titled "Mafia Princess - Growing Up In Sam Giancana's Family," as was the 1986 made-for-TV movie that starred Susan Lucci as Giancana and Tony Curtis as her father.

Las Vegas was part of her father's territory, and she's excited about "following in the shadow of his footsteps."

Giancana, 74, said she's moving here this summer to take a hands-on role in the project.

Her father, who controlled Chicago in the late 1950s and 1960s, was killed at his Chicago home June 19, 1975, four days before her birthday.

While the name of Las Vegas hit man Tony Spilotro has come up as a suspect, her No. 1 suspect, she said, remains the CIA. She's convinced the CIA wanted to silence her father. She co-wrote the 2005 book "JFK And Sam: The Connection Between the Giancana And Kennedy Assassinations," which made the case that her father ordered the assassination of President John F. Kennedy.

Giancana arrived with two beefy bodyguards for a business dinner Saturday at Capo's on West Sahara Avenue. She has asked Capo's owner Nico Santucci, a Chicago native, to design the Giancana room for the exhibit, which will include the same furniture that was in the family home the night her father was killed while frying Italian sausage and peppers.

"Sam would love this joint," she told Santucci, who opened the Italian steakhouse at 5675 W. Sahara Ave. this year. It's patterned after a Chicago speakeasy with photographs of mob icons and members of the Rat Pack.

The exhibit is "going to be a first," Giancana said. Bloom, she said, is "bringing in millions of dollars (worth of stuff) from various different (crime) families that have never, ever been seen" by the public.

Thanks to Norm Clarke

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Is ACORN Intentionally Structured As a Criminal Enterprise?

The election fraud factory known as ACORN should be stripped of its jealously guarded tax-exempt status because it illegally spends taxpayer dollars on partisan activities, commits "systemic fraud," and violates racketeering and election laws, according to a congressional report unveiled.

Republican investigators on the House Oversight and Government Reform Committee found that by "intentionally blurring the legal distinctions between 361 tax-exempt and non-exempt entities, ACORN diverts taxpayer and tax-exempt monies into partisan political activities."

"Operationally, ACORN is a shell game played in 120 cities, 43 states and the District of Columbia through a complex structure designed to conceal illegal activities, to use taxpayer and tax-exempt dollars for partisan political purposes, and to distract investigators," the report says. Structurally, it is "a chess game in which senior management is shielded from accountability by multiple layers of volunteers and compensated employees who serve as pawns to take the fall for every bad act."

The report examines the ACORN network's abusive interlocking directorates, and claims that the group deliberately organized itself to escape legal and public scrutiny. "ACORN hides behind a paper wall of nonprofit corporate protections to conceal a criminal conspiracy on the part of its directors, to launder federal money in order to pursue a partisan political agenda and to manipulate the American electorate."

There is "a pattern of loose financial accounting and no firewalls" within the community-based group's byzantine network of hundreds of affiliated groups, Rep. Darrell Issa (R-California) told TV talk show host Glenn Beck yesterday.

"It's very clear that that's for a reason," said Issa, ranking member on the committee. It is impossible to hand over government money "to ACORN and its affiliates without knowingly delivering it to partisan operatives who in fact engage in campaigning."

The report was "specifically done so that the facts speak for themselves so that very clearly we could make the case that ACORN cannot be receiving government money and should lose its tax-free status," the congressman said.

The unprecedented, damning new 88-page report --"Is ACORN Intentionally Structured As a Criminal Enterprise?" (PDF available here) -- declares that "[t]he weight of evidence against ACORN and its affiliates is astounding."

ACORN needs to be investigated criminally in order "to bring to justice the responsible parties who have heretofore been shielded from prosecution by ACORN's obscure organizational structure; to protect the American system of democratic self-government from manipulation and disruption; and to free our political climate from the choke of corruption that threatens to strangle free and fair elections."

It accuses the Association of Community Organizations for Reform Now of carrying out "a nation-wide strategy of tax fraud, racketeering, money-laundering and manipulating the American electorate." Specifically, the report accuses ACORN of racketeering, evading taxes, sloppy accounting, defrauding donors, defrauding the U.S. government, filing false statements, obstructing justice, and plundering employee pension funds.

The report singles out for special criticism the group's handling of a nearly $1 million embezzlement around 2000 by Dale Rathke, then a senior ACORN employee who is the brother of ACORN founder Wade Rathke. The misappropriation was covered up by management, including Wade Rathke, for eight years until it was revealed to the group's national board last summer.

The report notes that failing to report the misappropriation to the IRS in itself constitutes fraud, and that ACORN apparently raided pension funds to help cover the financial shortfall. ACORN also agreed last year to accept a bailout consisting of a $1 million loan and $500,000 in donations from Forest City Ratner, a developer that wants to build an ambitious project in Brooklyn, New York, to be called Atlantic Yards that would become, among things, the new home of the New Jersey Nets. The developer indicated in a letter to ACORN that it would disburse $500,000 in grants but the money wouldn't go to ACORN directly. The grants were to be made to the ACORN Institute, one of ACORN's tax-exempt nonprofit affiliates.

There are strings attached. ACORN previously signed an agreement to support the project in exchange for a commitment that the developer would build affordable housing, but the 2008 agreement with the developer provides that the ACORN Institute was to receive $300,000 of the $500,000 grant up front, with the remaining $200,000 to be paid out in equal installments in August 2009 and August 2010. With the current economy, it's unclear if the housing will be built, and whether the money paid out will stay at the ACORN Institute, which trains aspiring community organizers, is anyone's guess because ACORN routinely shuffles cash around its network.

The report also notes that Service Employees International Union (SEIU), two of whose locals are ACORN affiliates, was involved in discussions with now impeached Illinois Gov. Rod Blagojevich over whom he planned to appoint to Barack Obama's Senate vacancy in that state.

The report also points out that Wade Rathke, who was supposed to sever all ties with ACORN, hasn't. To the contrary, he remains deeply involved with at least three of ACORN's affiliated nonprofits.

He recently changed the name of ACORN's international consultancy, ACORN International, to Community Organizations International. Rathke also remains chief organizer, or CEO, of the New Orleans-based Local 100 of SEIU, another ACORN affiliate he founded. He does not appear to have stepped down as president and director of Affiliated Media Foundation Movement (AM/FM), an ACORN affiliate that produces news segments for eight alternative radio stations.

Rathke has long drawn inspiration from Saul Alinsky's legendary political strategy book, Rules for Radicals, but he only believes in rules if they benefit him. To this day he continues to defy the resolution approved on a vote of 29 to 14 by ACORN's national board on June 20, 2008. It declared that Rathke "be terminated from all employment with ACORN and its affiliated organizations or corporations" and that he "be removed from all boards & any leadership roles with ACORN or its affiliated organizations or corporations."

As detailed and damning as Congressman Issa's report may be, it faces an uphill battle in Congress. A push to hold congressional hearings on ACORN looked like it had momentum earlier this year until it abruptly stalled.

Although Democrats in Congress generally receive complaints about ACORN with a collective yawn, House Judiciary Committee John Conyers (D-Michigan), a longtime ACORN ally, shocked some on the left in March when he expressed interest in investigating the group. Conyers had considered evidence based on court testimony from former ACORN employee Anita MonCrief about ACORN's alleged serial violations of tax, campaign finance, and possibly illegal coordination with President Obama's election campaign.

At the time, Conyers said the allegations were "a pretty serious matter," but later he backed off, shrugging that "the powers that be decided against it."

The Issa report came a day after the American Civil Liberties Union of Pennsylvania and ACORN's Project Vote affiliate filed a federal lawsuit aimed at undermining the Keystone State's law aimed at combating election fraud.

To briefly digress, this isn't the first time that ACORN has tried to change laws instead of obeying them. In 1995 the group sued California to win an exemption from the law that required it to pay its own employees a minimum wage. ACORN lost after arguing that paying its employees more would reduce their activist zeal for the poor.

Now in Pittsburgh, former ACORN canvassers are facing convictions for voter registration fraud in Pittsburgh. ACORN cries political persecution while the ACLU claims the law has been misapplied by Allegheny County's Democratic District Attorney Stephen Zappala Jr., who filed charges against seven canvassers for falsifying voter registration forms. After preliminary hearings, all seven have been ordered to stand trial.

Witold Walczak of the ACLU said, "They already charged the employees, and they've hinted they might go after ACORN next."

In fact in May Nevada's Democratic attorney general and secretary of state unveiled voter registration fraud charges against ACORN and two of its senior executives. It was a historic moment because ACORN had long bragged about its ability to duck election fraud charges.

In Nevada ACORN has been accused of offering a bonus program called "Blackjack" or "21+" that paid a $5 bonus to each canvasser who brought in 21 or more completed voter registration forms each shift. Such schemes are banned in Nevada because they give canvassers an incentive to file fraudulent forms.

ACORN is also under investigation in Cuyahoga County, Ohio. The Democratic local prosecutor there is probing ACORN after a man registered to vote multiple times by the group was indicted by a grand jury for fraudulent voting.

Meanwhile, Rep. Steve King (R-Iowa) tried yet again to block ACORN from receiving taxpayer funds. On Thursday he offered an amendment to a spending bill that would have prohibited any taxpayer money in the bill from going to ACORN.

According to a King press release, "Liberals on the House Rules Committee ruled King's amendment out of order." This is the seventh amendment that lawmakers sympathetic to ACORN have blocked King from offering.

"John Conyers is right: the 'powers that be' in this Congress will do all they can to protect ACORN," King said.

And despite its mounting legal problems, the unceasingly controversial organization remains eligible for $8.5 billion in federal funds this year.

According to CNSNews, ACORN might also be eligible for government funding as a result of language in the Democrats' healthcare bill that would give federal money to groups that are members of a "national network of community based organizations." When asked, both Sens. Christopher Dodd (D-Connecticut) and Orrin Hatch (R-Utah) said they couldn't say for sure if ACORN could receive tax dollars under the legislation.

Thanks to Matthew Vadum

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Attorney General Eric Holder on Organized Crime Drug Enforcement Task Forces and Asset Forfeiture Program at the National Leadership Conference

The following remarks were issued by Attorney General Eric Holder:

Good morning and thank you for inviting me to join you today. It is a pleasure to be here among friends and colleagues, many of whom I've had the distinct pleasure of working with over the last 30 years during my time in the Department. There are too many familiar faces in the room to begin naming names, but as I have said many times in the last six months, it is great to be back.

These Leadership Conferences always present a great opportunity for us to learn from one another and for the Department to recognize your many significant accomplishments. This year's conference is even more special, as 2009 marks the 25th year of the Asset Forfeiture Program. I am very pleased to join you in this Silver Anniversary celebration, and I share your pride in the Asset Forfeiture Program's quarter-century of success.

I am also proud to be here today to honor the OCDETF Program, which is now in its 27th year. The OCDETF strategy recognizes that the most effective way to fight sophisticated criminal organizations is by leveraging the strengths, resources, and expertise of federal, state and local investigative and prosecutorial agencies. The OCDETF Program does this through the formation of prosecutor-led, multi-agency task forces that successfully target drug traffickers through cutting edge, intelligence-based analysis and investigative work.

Working together, the OCDETF and Asset Forfeiture Programs have a proven track record of destroying drug trafficking organizations by arresting and prosecuting their leadership and by seizing their financial infrastructure. I am delighted to be here today with the leaders of these great programs.

I'd like to begin by talking about OCDETF, which truly is the strategic centerpiece of the Department's counter-narcotics effort. When I served as United States Attorney, I was fortunate to lead the OCDETF effort here in Washington, DC, and experienced first-hand the field-level effectiveness of the Program. Later, as Deputy Attorney General, I saw just how powerful the OCDETF model could be on a nationwide basis. Now, as Attorney General, I am proud to support your continued success. Through your constant innovation and steadfast commitment to cooperation with our state and local partners, you have enhanced immeasurably our nation's counter-narcotics capabilities.

Two examples of OCDETF's innovative and cooperative approach demonstrate the effectiveness of the OCDETF strategy: (1) the establishment of the OCDETF Fusion Center; and (2) the creation of permanent, co-located OCDETF Strike Forces.

The OCDETF Fusion Center was established to address a pressing need for reliable, in-depth intelligence -- from both human and electronic sources -- to target and attack sophisticated international drug trafficking and money laundering organizations. Building on the OCDETF philosophy of cooperation and information-sharing, the Fusion Center brings together into a common database the unfiltered investigative information of each OCDETF member agency. Known as "Compass," this database allows analysts to connect investigative information from multiple agencies and to provide real-time analysis to agents and prosecutors in the field. The Fusion Center works in concert with the DEA-led Multi-Agency Special Operations Division to provide the most complete intelligence picture of criminal organizations currently available to U.S. law enforcement.

In recognition of the Fusion Center's effectiveness and the value of the Compass database, the International Organized Crime Intelligence and Operations Center -- or "IOC-2," as it is known -- recently entered into a partnership with the OCDETF Fusion Center. The IOC-2 will add important new data sources to the Compass database as well as new analysts into the OCDETF Fusion Center. Through this partnership, we will broaden our capability to attack organized crime in all its forms.

A second illustration of OCDETF's success is the creation of permanent, co-located OCDETF Strike Forces in Boston, New York, Atlanta, Tampa, San Juan, Houston, Phoenix, San Diego -- and soon in El Paso. Because they are both permanent and co-located, these strike forces foster close working relationships across agencies and facilitate multiple, wide-reaching, and highly effective multi-agency investigations. Moreover, these Strike Forces have taken innovative steps to leverage non-OCDETF resources to their great advantage. For example, working with the Asset Forfeiture Fund, OCDETF and the National Drug Intelligence Center have begun to place Document and Media Exploitation Teams in the Atlanta and Houston Strike Forces. These DOMEX teams allow Strike Force analysts and agents to capture and exploit evidence in complex, fast-paced investigations, and to develop trial exhibits for prosecutors quickly and effectively. We look forward to adding DOMEX teams to other co-located strike forces in the near future, beginning with those along the Southwest Border.

Collaborative and innovative efforts such as the OCDETF Fusion Center and the OCDETF Strike Forces are critically important if we are to succeed in our efforts to combat international drug traffickers and money launderers. The criminal organizations that OCDETF targets are as sophisticated as they are ruthless. Indeed, some of these groups have even aligned themselves with terrorist organizations. We have seen that Mexican drug cartels in particular, pose both a national security threat to Mexico and an organized crime threat to the United States. The cartels send seemingly endless supplies of cocaine, heroin, methamphetamine, marijuana and other illicit drugs across our borders and onto our streets. They operate seamlessly across local, state, and national boundaries. To combat this threat, we must also be seamless in our operations.

I know that all of you are up to the challenge. Since the inception of the Consolidated Priority Organization Target (or "CPOT") List in 2002, your OCDETF investigations have dismantled 39 CPOT organizations and have disrupted 20 more. Further, you have dismantled or disrupted more than 1,160 CPOT-linked organizations. The success of your operations is impressive, but not surprising. We can expect to achieve these kinds of results when we work together in innovative ways.

Together with OCDETF, the Asset Forfeiture Program has made, and continues to make, a critical difference in the fight against crime. Through your work, the Asset Forfeiture Program provides vitally important funding for law enforcement as well as resources that can be invested in community-changing programs such as "Weed and Seed." And of course, by seizing criminals' assets, you reduce the incentive to commit crime by taking money out of the hands of dangerous drug dealers and terrorists -- money that now works for law enforcement.

As with the OCDETF Program, the success of the Asset Forfeiture Program is a direct result of your hard work and your unfailing commitment to cooperation and collaboration at all levels and across all organizational lines. As Deputy Attorney General, it was my privilege to testify before Congress in support of asset forfeiture legislation. In that testimony, I emphasized the critical role that asset forfeiture plays not only in the fight against illegal drugs, but in the broader fight against other types of crime. Almost ten years to the day since that testimony -- and, appropriately, on the 25th anniversary of the Asset Forfeiture Program -- I am proud to say that the Asset Forfeiture Program remains a critical part of the Department's efforts to reduce and deter criminal activity.

Since 1984, more than $13 billion in net federal forfeiture proceeds have been deposited into the Justice Assets Forfeiture Fund. During this same period, more than $4.5 billion has been equitably shared with more than 8,000 state and local law enforcement agencies nationwide, thereby supplementing their constrained resources without further taxing the public. Once left with no real opportunity to recover their losses, crime victims are now recouping greater sums than ever before. Approximately $500 million in payments have been paid to more 39,000 victims in fiscal year 2008 alone.

Yet, the impact of forfeiture is greater than just money. When we look back on the last 25 years of the program, we see a forfeiture regime that has been transformed from a collection of centuries-old laws designed to fight pirates, enforce customs laws and fight illegal contraband, into an array of modern law enforcement tools designed to combat 21st century criminals both at home and abroad. We now have the ability to deprive global criminals of their ill-gotten gains, to seize the instrumentalities of their trade, and to use the power of asset forfeiture to destroy their illegal enterprises.

Operation Honor Student, a case that will be honored here later tonight, illustrates the power of asset forfeiture and its devastating effect on organized criminal activity. In that case, a task force led by the Rhode Island U.S. Attorney's Office, the Asset Forfeiture and Money Laundering Section of the Criminal Division, and the Food and Drug Administration's Office of Criminal Investigations obtained the forfeiture of $2.7 million from the accounts of GeneScience, one of the largest biopharmaceutical companies in China that had been involved in the illegal distribution of Human Growth Hormone into the United States. To accomplish this forfeiture, the task force employed a new statutory vehicle -- 18 U.S.C. section 981(k) -- which permitted the Government to seize the funds, physically located in China, from the corresponding accounts of Chinese banks in New York. This was the first use of section 981(k), enacted as part of the USA Patriot Act, against a Chinese entity, and its success has helped pave the way for subsequent investigations using this groundbreaking authority.

But not to minimize these impressive legal results, the true impact of Operation Honor Student lies in its practical effect on the illegal hGH market in the United States. Task force agents estimate that at the time of the investigation, GeneScience manufactured approximately 90% of the hGH being illegally sold and distributed in the United States. As a direct result of this seizure, GeneScience has stopped all shipments to the United States. So, through the use of a section 981(k) seizure, we were able to eliminate a supplier that represented 90% of an illegal drug market. Ninety percent.

Asset forfeiture plays a critical role not only in drug cases, but across the law enforcement spectrum -- from national security investigations, to securities fraud cases, to healthcare scams. And, of course, we cannot forget the most important -- and sometimes least heralded -- purposes of our Asset Forfeiture Program -- which is to make a meaningful difference in the lives crime victims by recovering stolen funds and property and returning them to their rightful owners.

When we look at the successes of both the Asset Forfeiture Program and the OCDETF Program, I cannot help but think about the possibilities, and challenges, for the next 25 years of these vitally important initiatives. While we have made great strides, international drug traffickers and money launderers continue to threaten our country. Criminal enterprises and terrorist networks continue to misuse our financial system for nefarious purposes. We can and we must do more. I am confident that under the leadership of those assembled here today, we will succeed.

The analysts, agents, and prosecutors of the OCDETF and Asset Forfeiture Programs are among the most talented and dedicated professionals in all of law enforcement. You protect this country day in and day out from the scourge of drugs and violence, and you do it with professionalism, creativity, and passion. I am proud to lead the Department of Justice, and am proud of each of you. Thank you for all that you do. Keep up the great work.

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U.S. Researcher Arrested in Russia for Investigating Organized Crime

A police official researching organized crime in Russia for a U.S. university was arrested after obtaining information on high-level corruption, colleagues say.

Col. Alexander Astafyev, 50, was studying the criminal takeover of businesses in Russia for Virginia's George Mason University when he was taken into custody, the Washington Post reported Thursday.

Colleagues say Astafyev was arrested after obtaining evidence incriminating influential figures in both Moscow and Vladivostok. "If such a person will be imprisoned now, that means corruption has totally won in Russia," says Maria Solovienko, the editor of an independent newspaper in Vladivostok.

Astafyev visited Washington last year at the invitation of the U.S. State Department and worked closely with FBI agents investigating organized crime.

He was working on a paper about the criminal takeover of businesses with the help of corrupt officials, police or judges.

Thanks to UPI

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