Call it a “Mob” contract gone bad.
Two cast members of “Mob Wives Chicago” are being sued by film producer and talent manager Nick Celozzi Jr., who says both women owe him a cut of their pay for appearing on the new VH1 reality TV show.
The lawsuits, filed in Cook County Circuit Court, accuse Renee Fecarotta Russo and Nora Schweihs of breaking their contracts with Celozzi.
He says his company, Family Ties Management, arranged for both women to attend a casting call with the show’s production company, JustJenn Productions. The women hired Celozzi to be their manager for two years, according to copies of contracts that appear to have been signed by Russo and Schweihs in December.
As their manager, Celozzi was supposed to collect 15 percent of what the women get paid to be on the TV show — a figure listed in the lawsuits as $6,000 for each of the season’s 10 episodes. That makes Celozzi’s cut $900 an episode for Russo and the same for Schweihs.
Looks like it was an offer they could refuse.
To date, Russo has forked over $500 while Schweihs has paid $900, according to the lawsuits, which say the women each owe a total of $9,000 for season one — plus interest and legal costs.
“I do believe a lot of people who are new to this business … when they realize that there’s a lot of costs to being involved in this type of industry, they change their minds about what decisions they wanted to have made several months prior,” said Celozzi’s attorney, James Pesoli.
The management contracts call for disputes to be settled before the American Arbitration Association in New York. But Pesoli said that “due to the size of the claim being relatively minimal, under $10,000, it’s in both parties’ best interest to attempt to settle it locally.”
Pesoli, who appeared in court with Russo’s attorney earlier this week, said discussions are under way to potentially settle out of court. He said things haven’t progressed as much in the case of Schweihs, whom they’ve had “a great amount of difficulty” in serving with the lawsuit.
Attempts to reach Schweihs, Russo and Russo’s attorney Wednesday were unsuccessful.
“Mob Wives Chicago,” a spinoff of the popular “Mob Wives” series, debuted June 10 and airs Sundays on the cable network. The show follows the lives of five women related to Chicago mobsters.
Russo is the niece of late loan shark and Outfit hit man “Big John” Fecarotta.
Schweihs is the daughter of Frank “The German” Schweihs, an alleged mob enforcer who died shortly before going to trial in 2008 in the city’s historic Family Secrets case. Nora Schweihs made headlines last week when she had father’s remains exhumed from St. Mary Cemetery in Evergreen Park — part of her purported quest to find out what really happened to her dad.
Celozzi, a former actor, used to appear in his father Nick’s commercials for Celozzi-Ettleson Chevrolet in Elmhurst. Dividing his time between California and the western suburbs, Celozzi has several mob-related entertainment projects in the works, including a documentary on his grand-uncle, notorious Outfit boss Sam “Momo” Giancana.
Thanks to Lori Rackl Irackl
Sunday, June 24, 2012
Saturday, June 23, 2012
Obama's NLRB Pick, Richard Griffin, Tied to Mob?
The rap sheet for members of the International Union of Operating Engineers reads like something out of "Goodfellas."
Embezzlement. Wire fraud. Bribery. That's just scratching the surface of crimes committed by the IUOE ranks. And it is from this union that President Obama earlier this year picked one of his latest appointees to the National Labor Relations Board, the federal agency tasked with resolving labor disputes between unions and management.
That recess appointee, Richard Griffin, was former general counsel for the 400,000-member union of heavy equipment operators -- a union tainted over the years by mob connections and a history of corruption.
Public documents obtained by Fox News show that more than 60 IUOE members have been arrested, indicted or jailed in the last decade on charges that include labor racketeering, extortion, criminal enterprise, bodily harm and workplace sabotage.
In some of the more egregious examples, federal prosecutors alleged in February 2003 that the Genovese and Colombo crime families wrested control of two IUOE locals, and stole $3.6 million from major New York area construction projects -- including the Museum of Modern Art and minor league baseball stadiums for the Yankees and Mets in Staten and Coney Islands.
Congress and the American public may never know whether Griffin's fiduciary responsibilities as general counsel were compromised by the avalanche of arrests, indictments and prosecutions of IUOE members. Griffin did not respond to Fox News' request for an interview. Before joining the NLRB, he served in various positions at the IUOE dating back to 1983. But records indicate he did not take an active role in representing any of the accused union members in criminal matters while he was general counsel for the union.
In at least one case during Griffin's tenure, the IUOE national headquarters placed a local that had run afoul of the law into trusteeship. But it remains unclear what other firewalls, if any, Griffin erected to separate the national union from its corrupt locals, or how he dealt with individual local union members who were in legal trouble.
On April 9, 2008, a dozen high-ranking members of an IUOE local in Buffalo, N.Y., were arrested for damaging more than 40 pieces of heavy machinery at construction sites where non-union workers were hired. They poured sand into oil systems, and cut tires and fuel lines. They also ran the license plate numbers of victims through a state database to get personal information including the names and addresses of victims' wives.
Among the individual union members and associates prosecuted in various investigations were:
Former U.S. Attorney and present New Jersey Gov. Chris Christie prosecuted some of the IUOE criminal cases. In one of Christie's prosecutions, Kenneth Campbell, the former business manager of local 825 of the IUOE, pleaded guilty to embezzling $200,000 from his union and taking bribes from contractors to buy high-end electronics and a Lincoln Town Car for his father, a retired IUOE member.
Then-U.S. Attorney Christie, said, "Campbell and his cronies were simply corrupt. They treated local 825 like a piggy bank at will to treat themselves to luxuries at the expense of dues-paying members they ripped off."
Because he was recess appointed, Richard Griffin, Jr., underwent no congressional scrutiny before he was sworn in on Jan. 9 of this year.
At the time of his recess appointment, Sen. Mike Enzi, R-Wyo., ranking member of the Senate Health, Education, Labor and Pensions Committee, told the Wall Street Journal he was, "extremely disappointed" in Obama's decision to "avoid the constitutionally mandated Senate confirmation process." He said that two of three nominees for the NLRB, including Griffin, were submitted to the Senate on Dec. 15, just before the Senate was to adjourn, allowing only a day to review the nominees.
Griffin has been an advocate for enhanced NLRB power for decades.
In 1988 testimony before the U.S. House Subcommittee on Employer/Employee relations, Griffin, who was then serving on the Board of Trustees of IUOE's Central Pension Fund, argued for more power for the NLRB to fine companies without a court order to enforce its rulings. He also argued against legislation that would have forced the NLRB and the Department of Labor to pay the legal costs for small businesses who won in court against unions.
Griffin's tenure on the NLRB will be longer than most recess appointees. The president delayed his appointment by one day until the start of a new congressional session -- effectively doubling to two years his stay. Recess appointments last until the end of the Senate's next session -- meaning Griffin will sit on the NLRB until December 2013.
Thanks to Doug McKelway.
Embezzlement. Wire fraud. Bribery. That's just scratching the surface of crimes committed by the IUOE ranks. And it is from this union that President Obama earlier this year picked one of his latest appointees to the National Labor Relations Board, the federal agency tasked with resolving labor disputes between unions and management.
That recess appointee, Richard Griffin, was former general counsel for the 400,000-member union of heavy equipment operators -- a union tainted over the years by mob connections and a history of corruption.
Public documents obtained by Fox News show that more than 60 IUOE members have been arrested, indicted or jailed in the last decade on charges that include labor racketeering, extortion, criminal enterprise, bodily harm and workplace sabotage.
In some of the more egregious examples, federal prosecutors alleged in February 2003 that the Genovese and Colombo crime families wrested control of two IUOE locals, and stole $3.6 million from major New York area construction projects -- including the Museum of Modern Art and minor league baseball stadiums for the Yankees and Mets in Staten and Coney Islands.
Congress and the American public may never know whether Griffin's fiduciary responsibilities as general counsel were compromised by the avalanche of arrests, indictments and prosecutions of IUOE members. Griffin did not respond to Fox News' request for an interview. Before joining the NLRB, he served in various positions at the IUOE dating back to 1983. But records indicate he did not take an active role in representing any of the accused union members in criminal matters while he was general counsel for the union.
In at least one case during Griffin's tenure, the IUOE national headquarters placed a local that had run afoul of the law into trusteeship. But it remains unclear what other firewalls, if any, Griffin erected to separate the national union from its corrupt locals, or how he dealt with individual local union members who were in legal trouble.
On April 9, 2008, a dozen high-ranking members of an IUOE local in Buffalo, N.Y., were arrested for damaging more than 40 pieces of heavy machinery at construction sites where non-union workers were hired. They poured sand into oil systems, and cut tires and fuel lines. They also ran the license plate numbers of victims through a state database to get personal information including the names and addresses of victims' wives.
Among the individual union members and associates prosecuted in various investigations were:
- Andrew Merola, a high-ranking member of the Gambino crime family who, in 2010, admitted to committing nine different acts of racketeering, including wire fraud involving a no-show/low-show job he got as an operating engineer for local 825 of the IUOE.
- James Roemer, a former treasurer of Operating Engineers local 14, who was sentenced in September 2003 to 41 months imprisonment and ordered to pay $2.7 million in restitution for conspiracy to fraudulently receive unlawful labor payments.
- Joel Waverly Cacace, Sr. The imprisoned acting boss of the Colombo crime family conspired with IUOE members to get a paid no-show construction job for his son, Jo-Jo Cacace, Jr. The senior Cacace was sent to prison in February 2003 for 20 years. The three-year investigation that sent him to jail also produced more than 24 other convictions.
Former U.S. Attorney and present New Jersey Gov. Chris Christie prosecuted some of the IUOE criminal cases. In one of Christie's prosecutions, Kenneth Campbell, the former business manager of local 825 of the IUOE, pleaded guilty to embezzling $200,000 from his union and taking bribes from contractors to buy high-end electronics and a Lincoln Town Car for his father, a retired IUOE member.
Then-U.S. Attorney Christie, said, "Campbell and his cronies were simply corrupt. They treated local 825 like a piggy bank at will to treat themselves to luxuries at the expense of dues-paying members they ripped off."
Because he was recess appointed, Richard Griffin, Jr., underwent no congressional scrutiny before he was sworn in on Jan. 9 of this year.
At the time of his recess appointment, Sen. Mike Enzi, R-Wyo., ranking member of the Senate Health, Education, Labor and Pensions Committee, told the Wall Street Journal he was, "extremely disappointed" in Obama's decision to "avoid the constitutionally mandated Senate confirmation process." He said that two of three nominees for the NLRB, including Griffin, were submitted to the Senate on Dec. 15, just before the Senate was to adjourn, allowing only a day to review the nominees.
Griffin has been an advocate for enhanced NLRB power for decades.
In 1988 testimony before the U.S. House Subcommittee on Employer/Employee relations, Griffin, who was then serving on the Board of Trustees of IUOE's Central Pension Fund, argued for more power for the NLRB to fine companies without a court order to enforce its rulings. He also argued against legislation that would have forced the NLRB and the Department of Labor to pay the legal costs for small businesses who won in court against unions.
Griffin's tenure on the NLRB will be longer than most recess appointees. The president delayed his appointment by one day until the start of a new congressional session -- effectively doubling to two years his stay. Recess appointments last until the end of the Senate's next session -- meaning Griffin will sit on the NLRB until December 2013.
Thanks to Doug McKelway.
Friday, June 22, 2012
FBI 2011 Bank Crime Statistics
The FBI released bank crime statistics for calendar year 2011. Between January 1, 2011 and December 31, 2011, there were 5,014 robberies, 60 burglaries, 12 larcenies, and seven extortions of financial institutions1 reported to law enforcement. The total 5,093 reported violations represent a decrease from 2010, during which 5,641 violations of the Federal Bank Robbery and Incidental Crimes Statute were reported.
Highlights of the report include:
These statistics were recorded as of April 24, 2012. Note that not all bank crimes are reported to the FBI, and therefore the report is not a complete statistical compilation of all bank crimes that occurred in the United States.
Highlights of the report include:
- Of the 5,086 total reported bank robberies, burglaries, and larcenies, loot was taken in 4,534 incidents (89 percent). Loot was taken during two of the seven reported bank extortions.
- The total amount taken was valued at more than $38 million. More than $8 million was recovered and returned to financial institutions.
- During the reported bank robberies, burglaries, and larcenies, the following modus operandi were the most common: demand note (2,958 incidents); oral demand (2,678 incidents); weapon threatened (2,331 incidents); and firearm used (1,242 incidents). Of the seven reported extortions, perpetrators used or threatened the use of explosive devices during one incident and made threats by telephone during four incidents.2
- Acts of violence were committed during 201 of the reported robberies, burglaries, and larcenies. These acts included 70 instances involving the discharge of firearms, 116 instances involving assaults, and one instance involving an explosive device.3 No acts of violence occurred during the seven reported bank extortions.
- Acts of violence during the reported robberis, burglaries, and larcenies resulted in 88 injuries, 13 deaths, and 30 persons being taken hostage. No injuries, deaths, or hostage takings occurred during the reported bank extortions.
- Most violations occurred on Friday. Regardless of the day of the week, violations between the hours of 9:00 a.m. and 11:00 a.m. were the most common.
- Most violations occurred in the Southern region of the U.S., with 1,576 reported incidents.
These statistics were recorded as of April 24, 2012. Note that not all bank crimes are reported to the FBI, and therefore the report is not a complete statistical compilation of all bank crimes that occurred in the United States.
- Financial institutions include commercial banks, mutual savings banks, savings and loan associations, and credit unions.
- More than one modus operandi may have been used during an incident
- One or more acts of violence may occur during an incident.
Wednesday, June 20, 2012
Raghuveer Nayak Charged with Fraud and Tax Offenses for Allegedly Paying Physicians Hundreds of Thousands of Dollars in Bribes for Patient Referrals
The owner of multiple area outpatient surgery centers was arrested today on federal fraud and tax charges alleging that he paid bribes and kickbacks to physicians for patient referrals and filed false federal income tax returns that understated his income. The defendant, Raghuveer Nayak, was charged in a 19-count indictment that was returned by a federal grand jury last week and unsealed today following his arrest, announced Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois; Robert D. Grant, Special Agent in Charge of the Chicago Office of Federal Bureau of Investigation; and Thomas Jankowski, Acting Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division.
Nayak, 57, of Oak Brook, was scheduled to appear at 11:00 a.m. today before Magistrate Judge Maria Valdez in U.S. District Court.
He was charged with 10 counts of mail fraud, five counts of interstate travel in aid of racketeering, and four counts of filing false income tax returns for the years 2005-2008. The indictment seeks forfeiture of at least $1.8 million in alleged fraud proceeds, or substitute assets, including Nayak’s Oak Brook residence, the Rogers Park One Day Surgery Center Inc., located at 7616 North Paulina St., and the Lakeshore Surgery Center LLC, located at 7200 North Western Ave.
In addition to those two facilities, Nayak owned and/or controlled the following health care-related businesses in Illinois and Indiana: Lakeside Surgery Center LLC, Merillville Plaza Surgery Center LLC, Lincoln Park Open MRI, Delaware Place MRI LLC, Paulina Anesthesia Inc., Illiana Anesthesia, Western Touhy Anesthesia Inc., and Division Medical Diagnostics Inc., according to the indictment.
Nayak’s facilities did not accept patients covered public health insurance programs, such as Medicare and Medicaid, and instead accepted patients insured by private health insurers, such as BlueCross BlueShield, or patients who agreed to pay the entire fees themselves. Private insurers treated Nayak’s facilities as “out-of-network” when paying bills submitted for patient services.
Between 2000 and December 2010, Nayak allegedly defrauded patients by paying and arranging to pay bribes and kickbacks in the form of cash and other hidden payments to physicians who would refer their patients to Nayak’s facilities for medical treatment. Nayak paid hundreds of thousands of dollars to different physicians in exchange for patient referrals, the charges allege, adding that the physicians deceived their patients by not disclosing that they were being paid for making referrals to Nayak’s facilities.
At times, the indictment alleges that Nayak paid bribes and kickbacks to physicians to begin referring patients, while at other times he did so to ensure that they continued to refer patients to his facilities. He allegedly offered to pay physicians a set amount of money for each patient referral. Nayak allegedly concealed and attempted to conceal the scheme by making payments in cash, disguising the payments as advertising, or by disguising the true purpose of the payments through fraudulent agreements and contracts, including contracts purporting to pay physicians for performing services that Nayak knew they had not provided.
Between 2002 and December 2008, Nayak allegedly obtained cash to pay bribes and kickbacks by giving Individual A more than $2 million in checks drawn on his facilities’ accounts and, in exchange, at Nayak’s direction, Individual A gave Nayak cash equaling approximately 70 percent of the value of the checks. Nayak allegedly indicated to his tax preparer that the checks to Individual A were for advertising and should be treated as a business expense on tax returns for Nayak and his facilities. After he was interviewed by law enforcement agents in December 2008, Nayak allegedly took additional steps to hide the scheme by executing fraudulent contracts and by warning physicians not to speak with agents about the payments.
The tax counts allege that Nayak caused the preparation of false individual federal income tax returns that understated his true income because he claimed that the checks to Individual A should be treated as advertising expenses when he knew they were not. As a result, Nayak allegedly understated his gross income when he reported the following amounts: $4,643,916 for 2005; $6,471,865 for 2006; $5,791,109 for 2007; and $9,362,647 for 2008.
Each count of mail fraud carries a maximum penalty of 20 years in prison and a maximum fine of $250,000, or an alternate fine totaling twice the loss or twice the gain, whichever is greater, as well as mandatory restitution. Interstate travel in aid of racketeering carries a maximum prison term of five years and a $250,000 fine on each count, and each count of filing a false income tax return carries a three-year maximum prison term and a $250,000 fine. In addition, defendants convicted of tax offenses must pay the costs of prosecution and remain liable for any and all back taxes, as well as a potential civil fraud penalty of 75 percent of the underpayment plus interest. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented by Assistant U.S. Attorneys Carrie Hamilton and Andrianna Kastanek.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Nayak, 57, of Oak Brook, was scheduled to appear at 11:00 a.m. today before Magistrate Judge Maria Valdez in U.S. District Court.
He was charged with 10 counts of mail fraud, five counts of interstate travel in aid of racketeering, and four counts of filing false income tax returns for the years 2005-2008. The indictment seeks forfeiture of at least $1.8 million in alleged fraud proceeds, or substitute assets, including Nayak’s Oak Brook residence, the Rogers Park One Day Surgery Center Inc., located at 7616 North Paulina St., and the Lakeshore Surgery Center LLC, located at 7200 North Western Ave.
In addition to those two facilities, Nayak owned and/or controlled the following health care-related businesses in Illinois and Indiana: Lakeside Surgery Center LLC, Merillville Plaza Surgery Center LLC, Lincoln Park Open MRI, Delaware Place MRI LLC, Paulina Anesthesia Inc., Illiana Anesthesia, Western Touhy Anesthesia Inc., and Division Medical Diagnostics Inc., according to the indictment.
Nayak’s facilities did not accept patients covered public health insurance programs, such as Medicare and Medicaid, and instead accepted patients insured by private health insurers, such as BlueCross BlueShield, or patients who agreed to pay the entire fees themselves. Private insurers treated Nayak’s facilities as “out-of-network” when paying bills submitted for patient services.
Between 2000 and December 2010, Nayak allegedly defrauded patients by paying and arranging to pay bribes and kickbacks in the form of cash and other hidden payments to physicians who would refer their patients to Nayak’s facilities for medical treatment. Nayak paid hundreds of thousands of dollars to different physicians in exchange for patient referrals, the charges allege, adding that the physicians deceived their patients by not disclosing that they were being paid for making referrals to Nayak’s facilities.
At times, the indictment alleges that Nayak paid bribes and kickbacks to physicians to begin referring patients, while at other times he did so to ensure that they continued to refer patients to his facilities. He allegedly offered to pay physicians a set amount of money for each patient referral. Nayak allegedly concealed and attempted to conceal the scheme by making payments in cash, disguising the payments as advertising, or by disguising the true purpose of the payments through fraudulent agreements and contracts, including contracts purporting to pay physicians for performing services that Nayak knew they had not provided.
Between 2002 and December 2008, Nayak allegedly obtained cash to pay bribes and kickbacks by giving Individual A more than $2 million in checks drawn on his facilities’ accounts and, in exchange, at Nayak’s direction, Individual A gave Nayak cash equaling approximately 70 percent of the value of the checks. Nayak allegedly indicated to his tax preparer that the checks to Individual A were for advertising and should be treated as a business expense on tax returns for Nayak and his facilities. After he was interviewed by law enforcement agents in December 2008, Nayak allegedly took additional steps to hide the scheme by executing fraudulent contracts and by warning physicians not to speak with agents about the payments.
The tax counts allege that Nayak caused the preparation of false individual federal income tax returns that understated his true income because he claimed that the checks to Individual A should be treated as advertising expenses when he knew they were not. As a result, Nayak allegedly understated his gross income when he reported the following amounts: $4,643,916 for 2005; $6,471,865 for 2006; $5,791,109 for 2007; and $9,362,647 for 2008.
Each count of mail fraud carries a maximum penalty of 20 years in prison and a maximum fine of $250,000, or an alternate fine totaling twice the loss or twice the gain, whichever is greater, as well as mandatory restitution. Interstate travel in aid of racketeering carries a maximum prison term of five years and a $250,000 fine on each count, and each count of filing a false income tax return carries a three-year maximum prison term and a $250,000 fine. In addition, defendants convicted of tax offenses must pay the costs of prosecution and remain liable for any and all back taxes, as well as a potential civil fraud penalty of 75 percent of the underpayment plus interest. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented by Assistant U.S. Attorneys Carrie Hamilton and Andrianna Kastanek.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
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