Heroin and Cocaine Supply Networks, Street Gang Drug and Gun Sales Targeted in Three Separate Investigations Resulting in State and Federal Charges Against 55 Defendants

Fifty-five defendants are facing state or federal charges following separate law enforcement operations that penetrated alleged wholesale cocaine and heroin supply networks and street gang-related retail sales of drugs and guns on the city’s south and west sides. Nearly 20 firearms, tens of kilograms of heroin and cocaine, more than $800,000 in cash, and three luxury automobiles were seized during the course of the joint local, state and federal investigations that were taken down consecutively today, yesterday and Tuesday.

The defendants charged in the operations included drug wholesalers alleged to have narcotics supply connections in Mexico; the customers of those wholesalers, whose alleged re-sales extended from Chicago into Indiana and Wisconsin; and members of six different street gangs who allegedly dealt drugs and guns to an undercover operatives. In one instance, the violence that often accompanies guns, drugs and gangs was captured on a telephone wiretap when a gunman fired a shot into a car as one federal defendant, who allegedly brokered a cocaine deal, then orchestrated a robbery of both the buyer and seller.

The following events occurred in a series of early morning operations this week:

• On Tuesday, Chicago police and federal Alcohol, Tobacco, Firearms and Explosives (ATF) agents executed arrest and search warrants against 20 state and 13 federal defendants who allegedly sold various amounts of crack cocaine and/or firearms in a single west side neighborhood to an undercover agent, mostly since 2009. Thirteen guns and rifles were seized during the investigation;
• On Wednesday, FBI and DEA agents, together with Chicago police, began executing arrest and search warrants against 18 federal defendants, including Moises Villalobos, an alleged wholesale dealer with Mexican connections after authorities seized approximately 25 kilos of heroin from him since July in Chicago and south suburban Harvey. Villalobos allegedly supplied heroin to a faction of the Gangster 2-6 Nation street gang that was dismantled two weeks ago in a similar takedown on state and federal narcotics charges. Another defendant, Roberto Romero, allegedly directed a separate drug-trafficking cell that was supplied by Villalobos, and which re-sold wholesale quantities of cocaine and heroin to various customers in the Chicago area, as well in Milwaukee and northern Indiana. Defendant Antonio Negron allegedly transported wholesale supplies of cocaine into Chicago on multiple commercial airline trips from Puerto Rico, and yet another defendant, Helga Weis, allegedly staged the simultaneous robbery of a drug supplier and a customer; and
• Today, FBI agents began executing arrest warrants against four additional defendants, including two alleged members of the Mickey Cobras street gang and two alleged Gangster Disciples members, who allegedly sold various amounts of either heroin or crack cocaine, and in one instance a 9 mm rifle, on the city’s south side to individuals cooperating with law enforcement agents.

“The wholesale supply side and the retail street sales of narcotics trafficking are equally important components of the same problem,” said Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois. “These coordinated efforts demonstrate the commitment of all law enforcement agencies in Chicago, at both the federal and state level, to combat the dangerous combination of gangs, guns and drugs in our community,” he added.

“Using all of our combined police and prosecutorial resources, we are continuing to successfully hammer away at the drug markets and the accompanying violence that is plaguing so many of our communities,” said Cook County State's Attorney Anita Alvarez.

“The core missions of ATF are combating gun crimes and interdicting the illegal trafficking and possession of firearms. As demonstrated by our investigation and arrests, we are fulfilling those missions by targeting mid-level narcotics traffickers and their support networks. It is ATF’s committed contribution to the comprehensive fight against violent crime throughout the city of Chicago” said Andrew L. Traver, Special Agent-in-Charge of ATF in Chicago.

“The DEA will continue to investigate alleged drug trafficking organizations with every legally available tool we possess. During this investigation, our agents worked with the FBI and the Chicago Police Department to deploy a myriad of investigative tactics, from surveillance to court-authorized wire intercepts,” said Jack Riley, Special Agent-in-Charge of the Chicago Field Division of the DEA. “Our mission is to keep law enforcement pressure on these alleged drug distribution networks, while gathering evidence for use in court.”

Jody P. Weis, Superintendent, Chicago Police Department, said: “This operation is critical because it targeted individuals who are alleged to have received illegal drugs that were subsequently sold on the city's south and west sides. Removing these individuals will impact the ability of street gangs to profit from their illegal activities.”

Also announcing the charges was Robert D. Grant, Special Agent-in-Charge of the Chicago Office of the FBI. The U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI) and the U.S. Marshals Service assisted with the investigations and arrests. All three investigations were conducted under the umbrella of U.S. Organized Crime Drug Enforcement Task Force (OCDETF), and with assistance from the High Intensity Drug Trafficking Area Task Force (HIDTA). The investigations, which employed wiretaps, surveillance, cooperating witnesses, undercover drug and firearms transactions, and a steady progression of searches and seizures of evidence, are continuing the officials said.

The ATF/CPD undercover investigation

ATF agents and Chicago police officers have been investigating illegal drug and weapons sales by individuals in the west side neighborhood bounded by Keeler, Kilbourn, Iowa and Walton streets. Beginning before 2009, the investigation focused on the alleged narcotics sales operation of Ivan Thomas, also known as “Pimp,” as well as Anthony Grant, Ervin Hewing, Reynaldo Davis, and Antwain Lashley, who allegedly worked with Thomas to distribute crack cocaine and heroin. ATF agents were assisted in the investigation by a cooperating source (CS1) and, from January through July this year, provided CS1 with an apartment in the Walton Street neighborhood to facilitate CS1's assistance. During the investigation, an undercover agent, posing as CS1's friend, was introduced to make undercover purchases of guns and drugs.

As a result of the undercover investigation, 20 defendants are facing state narcotics charges alleging delivery of a controlled substance, and 13 defendants are facing federal charges. Of the 33 defendants, 14 were arrested Tuesday or yesterday, eight were already in custody or on bond, and 11 remain at large with arrest warrants outstanding. The complaints identify individual defendants variously as members of the Four Corner Hustlers, the Conservative Vice Lords, the Traveling Vice Lords, the Gangster Disciples and the New Breeds street gangs.

Thomas, 26, who was arrested and whose apartment in the 100 block of South Hamlin Avenue was searched on Tuesday, was charged with conspiring with Grant, Hewing, Davis and Lashley in December 2009 to distribute more than 50 grams of crack cocaine, which carries a mandatory minimum penalty of 10 years to a maximum of life in prison and a $4 million fine.

Also charged separately with distributing more than 50 grams of crack cocaine were: Davis, 21; Grant, 30, who was arrested last month and has pleaded not guilty after being indicted; and Lashley, 30. Charged with distributing more than five grams of crack were: Dianiso Dorsey, 30; Hewing, 22, and brothers, Jermaine, 37, and Michael Lewis, 34. That charge carries a mandatory minimum of 5 years to a maximum of 40 years in prison and a $2 million fine.

Five defendants—Jerome Carson, 30; George Smith, 26; Gregory Hayes, 26; Donneil Reed, 32, and Timothy Williams, 22—were each charged with being a felon in illegal possession of a firearm. Carson allegedly sold three .22 caliber rifles and a 9 mm pistol to the undercover agent or cooperating informant over the last year; Smith and Hayes both allegedly possessed a 9 mm pistol that was seized; and Reed and Williams, allegedly each sold a pistol to the undercover agent. Six other firearms were seized during the investigation. The felon-in-possession charge carries a maximum penalty of 10 years in prison and a $250,000 fine.

The government is being represented in these cases by Assistant U.S. Attorneys Steven Block, Tiffany Tracy and Kartik K. Raman.

The DEA/FBI/CPD wholesale supply investigation

In one of five separate complaints, Moises Villalobos, 23, also known as “Antonio Salgado,” Faustino Arrellano, 37, Adan Moreno, 20, and Rosa Fernandez, 53, were charged with conspiring between May and Aug. 25, 2010, to possess and distribute a kilogram or more of heroin and five kilograms or more of cocaine. On July 14, agents and officers seized nearly a kilogram of heroin after Villalobos allegedly had a courier deliver it to a customer; on Aug. 15, approximately 10 kilograms of heroin was seized before it was delivered to Villalobos; and approximately 12 kilograms of heroin was seized on Aug. 24 from a car in a garage in Harvey after Villalobos’ co-defendants allegedly moved it from a “stash house” in Chicago.

According to the specific transactions described in the complaint, between April and August this year alone, Villalobos and his co-defendants were responsible for the movement of at least 17 kilograms of cocaine and 50 kilograms of heroin.

Villalobos allegedly used his connections to Mexican brokers to receive wholesale quantities of cocaine and heroin from suppliers in the Chicago area, and then distributed those narcotics to various customers, including Roberto Romero, 45, who was charged in a separate complaint, along with 10 co-defendants, for allegedly operating a re-sale distribution network that had customers across the region, including in Milwaukee and northern Indiana. Villalobos and his organization also allegedly supplied multiple kilograms of cocaine to Francisco Masias, the alleged leader of a 2-6 street gang faction who was among 19 defendants who were charged with federal narcotics crimes two weeks ago.

According to the charges, Villalobos maintained two stash houses where he received and stored his supplies of heroin and cocaine. One was located at 2455 N. McVicker in Chicago, where agents and officers found approximately 1.7 kilograms of heroin, 1.2 kilograms of cocaine and $750,000 in cash hidden under the floor of a bedroom closet during a search on Aug. 19 after Villalobos was arrested on state drug charges. The other stash house was located at 2826 N. Long in Chicago, where Villalobos allegedly received a shipment of approximately 13 kilograms of heroin on June 25. Between Aug. 12 and 18, approximately 12 kilograms of heroin was stored at the Long house before Villalobos’ co-conspirators allegedly moved the heroin to Harvey, and Villalobos, Arrellano and Fernandez simultaneously removed other belongings from the house as well.

Both the Villalobos and Romero complaints allege the seizure of nearly a kilogram of “Mexican brown heroin” on July14 when a courier for Villalobos allegedly attempted to make a delivery to one of Romero’s customers, identified as Leo Mercado, by placing the heroin on the front floorboard of an unlocked silver Mercedes SUV parked in the 4900 block of North Harding. Unbeknownst to the defendants, agents, who were conducting surveillance, immediately seized the heroin from the vehicle before it could be retrieved, and subsequent intercepted phone calls indicated that Villalobos and Romero believed that Romero’s customer was lying when he later claimed that he could not find the heroin in the vehicle.

The Romero complaint alleges that he received wholesale quantities of cocaine and heroin from Villalobos, as well as his main cocaine supplier, Richard Medina, 27, of Berwyn, with whom he bought and sold heroin, and that he then “fronted” both cocaine and heroin to other customers for re-sale. The nine-count, 157-page complaint charges the following: Counts One, Two and Four charge Romero; Medina; Alejandro Reyes, 26; Abraham Mercado, 29, of Cicero; and Ana Montoya, 30, with one count each of conspiracy to possess and distribute five kilograms or more of cocaine; Count Three charges an unnamed defendant later identified as Leo Mercado, 24, with conspiracy to posses and distribute one kilogram or more of heroin; Counts Five through Seven charge Nicolas Gomez, 31; Thomas Merced, 31,of Hobart, Ind.; and Luis Lopez-Martinez, 26, of Melrose Park; with one count each of conspiracy with Romero to possess and distribute more than 500 grams of cocaine; Count Eight charges and Israel Hernandez, 37, of Forest Park, with possession with intent to distribute more than 500 grams of cocaine; and Count Nine charges Johnny Fort, 45, with conspiracy with Romero to possess and distribute more than 100 grams of heroin.

Three other defendants were charged individually in separate complaints. They are: Francisco Llamas, 41, distribution of heroin; Antonio Negron, 39, of Winter Haven, Florida, conspiracy to distribute cocaine—Negron allegedly transported various amounts of cocaine to Chicago on five trips between November 2009 and March 2010 aboard commercial airlines arriving at O’Hare International Airport; and Helga Weis, 25, interstate robbery—Weis, together with three unnamed, uncharged individuals, allegedly brokered a cocaine deal on March 10, 2010, between a supplier and a customer, in which both were robbed but only money was taken.

After meeting with the customer and obtaining $1,500 for the purchase of cocaine, Weis met with the supplier in the supplier’s car in the vicinity of West Armitage and North Kostner avenues. Using a monitored phone, Weis had placed an outgoing call that went to voicemail but the phone remained on during the following events, according to her complaint: a gunman approached the car, threatened to shoot and demanded money and the car keys, and then fired a shot into the car. Weis gave the gunman $1,400 and the supplier gave the keys before the gunman fled with the money but no drugs. The victim supplier then fled and Weis allegedly called the gunman and another individual to return to the car to obtain cocaine left inside the vehicle but they were unable to retrieve it from a hidden compartment. Weis then told the victim customer about the purported robbery without disclosing her alleged involvement.

If convicted, Villalobos, Arrellano, Moreno, Fernandez, Romero, Medina, Reyes, both Mercados, and Montoya face a mandatory minimum sentence of 10 years to a maximum of life in prison and a $4 million fine. Defendants Gomez, Merced, Lopez-Martinez, Hernandez, and Fort face a mandatory minimum of five years and a maximum of 40 years in prison and a $2 million fine. Defendants Llamas, Negron and Weis each face a maximum penalty of 20 years in prison and a $250,000 fine. The Court, however, must determine a reasonable sentence under the advisory United States Sentencing Guidelines.

The government is being represented by Assistant United States Attorneys Steven Kubiatowski, Stephen Lee and Angel Krull.

In the operation that commenced today and was still unfolding, the government is being represented by Assistant U.S. Attorneys Halley Guren, Steven Grimes and Christopher McFadden.

The public is reminded that charges are merely allegations and are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

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Jerry "The Monk" Scalise, Reputed Mob Jewel Thief, Freed from Custody

Convicted jewel thief Joseph "Jerry" Scalise was ordered released from custody following Tuesday's decision by Judge Harry Leinenweber denying the government's motion to revoke a pre-trial release order.

The 72-year-old Scalise has been in the Metropolitan Correctional Center since his arrest last April along with Arthur "The Genius" Rachel, 71, and Robert "Bobby" Pullia, 69, as they allegedly scouted banks to rob in the western suburbs. Federal authorities picked up the three as they were preparing to rob the Bridgeport mansion of deceased Chinatown Outfit boss Angelo "The Hook" LaPietra. They were arrested outside LaPietra's one time home with burglary tools, guns, ammo and communications equipment, according to federal agents. At the time of their arrest, there was speculation by mobologists that Scalise and crew were going into LaPietra's former castle-like residence to retrieve the famous Marlborough diamond-missing since a daring daylight burglary in 1980. The 45-carat diamond was stolen from Graff Jewelers in London, UK. Scalise and Rachel were arrested as they arrived at O'Hare International Airport that evening, minus the diamond. Both men were convicted in the theft of the diamond, among $4 million in stolen gems, and served time in a British penitentiary.

Last month, in an effort to prevent Scalise's bond, prosecutors connected him to a Chicago mob hit squad known as The Wild Bunch based on testimony by an admitted mob assassin during the renowned Family Secrets trial. "In its attempt to connect Mr. Scalise to the 'Wild Bunch,' the government relies on the testimony of Nick Calabrese, a confessed murderer, and Frank Calabrese, a convicted murder, given during the 'Family Secrets' trial," wrote Scalise's attorney Edward Genson. "The testimony regarding Mr. Scalise's involvement in the "Wild Bunch" was based solely upon hearsay and was not substantiated by any independent evidence at trial, nor was it substantiated by any evidence on the record&. Furthermore, Mr. Scalise was never arrested or questioned regarding his participation in any of these alleged homicides either before or after the Family Secrets trial."

Scalise will be under house arrest while he's out on $500,000 bond, secured by property posted by his girlfriend, family and friends. His co-defendant's Arthur Rachel and Robert Pullia are currently out on bond.

Thanks to Ann Pistone, Barb Markoff and Chuck Goudie

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Florida Mafia Crew Dismantled by Operation Money Fish

Members of the New York-based Bonanno crime family were making millions of dollars in South Florida cashing counterfeit checks, running telemarketing scams, defrauding Medicare, and stealing and selling people’s identities. But when they hooked up with a shady businessman to help them launder all that money, they got more than they bargained for.

The businessman with supposed connections in the banking industry was really one of the FBI's undercover agents, and he infiltrated the mafia crew for nearly a year. The evidence he gathered, along with intercepted phone calls and other electronic surveillance, was enough to put the entire 11-member operation out of business and behind bars.

“The mafia has always been in South Florida,” the agent explained. “Each of New York’s five families has crews that operate here. They make a lot of money and send part of it back to the main guys up north.”

The Bonanno family’s criminal enterprise in South Florida—led by Tommy Fiore, the nephew of reputed Bonanno capo Gerry Chili—was wide ranging. In addition to the scams mentioned above, the crew also participated in arson, extortion, drug trafficking, and buying and selling stolen cigarettes, TVs, and other ill-gotten goods.

Operation Money Fish began in the summer of 2008, when our agent—who was known as Dave Stone—met Fiore. The Bonanno crew was manufacturing counterfeit payroll checks from large companies and needed help cashing them. They would copy a legitimate check, change the account numbers and the amount, and get Dave Stone to use his banking connections to turn the bad paper into cash. Dave and the crew then split the profits. (In reality, since we controlled the operation, no businesses were actually defrauded.)

The crew’s most lucrative scam, though, came from “boiler rooms”—bogus telemarketing operations that are rampant in South Florida. A dozen people working the phones out of someone’s condo can generate big profits. A popular pitch now involves the resale of time share properties. The criminal telemarketers claim they will help people resell their time share, or the fee charged will be refunded in full. Unsuspecting victims on the other end of the line—mostly older people unable to sell the properties on their own—send in the $5,000 or $6,000 fee, and that’s the last they ever see of their money. No services are rendered, and none were ever intended to be.

With the overwhelming evidence against them, the Bonanno crew all pled guilty to racketeering and other charges. “It was a good feeling to bring these guys down,” the undercover agent said. “They were getting away with a lot of crimes. There’s no telling how many people they had hurt or swindled before we got involved.”

But “Dave Stone” and his colleagues on the FBI’s organized crime squads understand that while you can disrupt the mafia’s activities in South Florida and elsewhere, it’s only a matter of time before the bosses in New York establish other crews.

“Absolutely they will try to start up again,” the agent said. “The Bonanno family in New York—like the other families—has to have somebody down here making money because the guys at the top don’t do anything. They rely on the crews to support them. But if they do show up again,” he said, “we will be ready.”

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Al Capone and The Chicago Outfit Cocktails Among Highlights of The Walnut Speakeasy in Elgin

There's more to a cocktail than the ingredients and preparation. Sipping a highball in an empty bar reeking of last night's party with a distracted barkeep can surely ruin any cocktail experience. At the Walnut Speakeasy, you can choose from a number of enticing cocktails (or beers from their Connoisseur's Beer List) and enjoy an engaging staff, and local blues in a cozy 1930's speakeasy atmosphere.

Premium liquors and classic suggestions. The Walnut Speakeasy is dominated by a large wrap-around bar (made from solid walnut) carrying everything from Belvedere to Louis XIII. As if the selection weren't enough, they know how to put a cocktail together. Templeton Rye is a mainstay here as it was created during the prohibition era and was one of Capone's favorites. "The Capone" is a stiff drink made with Templeton rye and a perfect combination of Grand Marnier, bitters and champagne. Other selections from the cocktail menu include "The Chicago Outfit" (a spin on a chocolate raspberry martini) and "The Cat's Meow".

Unique music and local artists. This place can swing! Owner Alex Matsas has put together a jazzy line up ranging from local blues sensations, Nick Moss & The Flop Tops, to jazz crooners John & Cassy . This is one of the only bars around you can bank on for you blues fix every weekend.

"Form, meet function." Bricks pulled from prohibition-era buildings and burled walnut wood-working invite guests to relax in the feel of an upscale 1930's Chicago bar. This is no neighborhood bar kitchen either! State of the art infrared grills and proper pizza ovens give weight to the quality of the cuisine. There are no bar smells and from the front door to the kitchen floor, this place is spotless!

General Information

Location: 214 Walnut Ave Elgin, IL 60123
Hours: Mon -Thurs 11 am -1 am, Fri & Sat 11am -2 am, Sun 11am - 11 pm
Food: breakfast, lunch, dinner
Price: Excellent value, beer & wine prices available online
Parking: free lot on west side of building, at peak times you may have to park street nearby
Music: Blues & Jazz

Thanks to the Examiner

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Lawyers Look to Ditch Reputed Mobsters Over Money

Defense attorneys for two of the three Chicago hoodlums who were arrested last April for allegedly plotting bank heists, are asking to withdraw because their clients are broke.

Marc Martin and Terrence Gillespie will appeal to U.S. District Judge Harry Leinenweber on September 7th saying they do not want to work for free, or pro bono, on behalf of Robert "Bobby" Pullia, 69 or Arthur "The Genius" Rachel, 71. According to motions filed this week, Martin and Gillespie will tell the judge that the Outfit-related case has "over 50 hours of recordings and many hours of surveillance video," according to motions filed Tuesday.

This comes two weeks after a hearing at which Judge Leinenweber asked Pullia, Rachel and a third defendant Joseph "Jerry" Scalise, 73 if they had issues with being represented by attorneys from a related law firm. The judge noted that such an arrangement could result in conflict of interests during legal proceedings. The men agreed to have the attorneys continue their representation and waived any future conflict claims.

Pullia and Rachel are out on bond. Scalise was granted bond but prosecutors are appealing and he remains in custody pending the a district court ruling. Scalise was part of a gangland hit squad and involved in numerous mob murders, according to government filings in the case.
Federal authorities say they arrested the three aging mob figures as they were preparing to rob the Bridgeport mansion of deceased Chinatown Outfit boss Angelo "The Hook" LaPietra. The men were arrested outside the LaPietra home with burglary tools, guns, ammo and communications equipment, according to federal agents.

At the time, mobologists speculated that Scalise and crew were going into LaPietra's former castle-like residence to retrieve the famous Marlborough diamond-missing since a daring daylight burglary in 1980. The 45-carat diamond was stolen from Graff Jewelers in London, UK. Scalise and Rachel were arrested as they arrived at O'Hare Airport that evening, sans diamond.

Although both men were convicted in the theft of the diamond-among $4 million in stolen gems-and served time in a British penitentiary, the royal Marlborough diamond was never recovered.

Some investigators have long held that the huge diamond was mailed to mob bosses in Chicago.

Thanks to Ann Pistone and Chuck Goudie

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