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OFFICE OF THE INDEPENDENT HEARING OFFICER LABORERS' INTERNATIONAL UNION OF NORTH AMERICA
ORDER AND MEMORANDUM
This matter comes before the Laborers' International Union of North America (LIUNA) Independent Hearing Officer (IHO) pursuant to the LIUNA Constitutions and the Ethics and Disciplinary Procedure (EDP). On March 3, 1999, Disciplinary Charges were filed by the LIUNA General Executive Board Attorney (GEB Attorney) against Bruno Caruso, Frank Caruso,' Leo Caruso (Respondents), and James DiForti. The charges allege Respondents committed conduct proscribed by the LIUNA Constitutions and the EDP by membership in and knowing association with the Chicago Outfit of organized crime, violation of duty of loyalty, permitting LCN influence in LIUNA, and violation of constitutional duties. James DiForti died after the hearing in this matter was held, but before the briefing and ruling; as a result, the GEB Attorney requested that the IHO dismiss the charges against him. The charges against DiForti will be dismissed infra. The Respondent in this case is Frank Michael Caruso, also known as Frank Caruso, Jr., and by the nicknames "Toots," "Tootsie," or "Babe." The Respondent's father is named Frank Tony Caruso and is known as Frank Caruso, Sr., or by the nickname "Skids." Unless otherwise noted, "Frank Caruso" in this Order and Memorandum shall refer to the Respondent. References to the Respondent's father shall be indicated as either "Frank `Skids' Caruso" or "Frank Caruso, Sr." Bruno Caruso and Leo Caruso filed several pretrial motions to which the GEB Attorney responded. The IHO issued several orders addressing the pretrial motions. See 99-12D, IHO Orders (September 14 and 15, 1999). In response to Bruno Caruso and Leo Caruso's Motion for Full Disclosure, the.II40 ordered the GEB Attorney to provide additional specifics regarding the charges. See 99-12D, IHO Order (September 15, 1999) and 99-12D, GEB Attorney's Responses to IHO's Orders (November 11, 1999). The IHO rescheduled the hearing several times for several months to accommodate the schedule of defense counsel and to permit one Respondent to hire new counsel due to his former counsel's involvement in complex litigation. The IHO held a pre-hearing conference on December 6, 1999, for the GEB Attorney and Respondents to preliminarily identify documents they intended to introduce at the hearing. The GEB Attorney provided a memorandum regarding his exhibits, their relevance, and admissibility. See 99-12D, GEB Attorney's Memorandum re Exhibits and Undisputed Facts (December 6, 1999). The IHO held a hearing in Chicago, Illinois on January 10-12, 20-21, 26-27 and February 8-10, 21, 2000. The hearing testimony is contained in over 2000 pages of transcript and included twenty-eight witnesses and over one hundred exhibits. Bruno Caruso and Leo Caruso appeared at the conference and the hearing and were represented by counsel. Counsel for Frank Caruso and James DiForti communicated to the IHO that neither they nor their clients would attend the hearing but wanted to continue receiving copies of communications. Counsel for Local Union 1001 was permitted to attend but not actively participate in the hearing. The IHO permitted Leo Caruso to reopen the record and allowed for additional testimony which was taken by telephone on May 1, 2000. The GEB Attorney and Respondents Bruno Caruso and Leo Caruso submitted post-hearing briefs. 2 RECUSAL OF THE IHO Bruno Caruso and Leo Caruso repeatedly moved for recusal of the IHO based upon the IHO having previously officiated at the trusteeship hearing for the Construction & General Laborers' District Council of Chicago & Vicinity (Chicago District Council or CDC). See In the Matter of the Construction & General Laborers' District Council of Chicago & Vicinity (In Re Chicago District Council), IHO Order and Memorandum, 97-30T (February 7, 1998). Prior to the hearing, the IHO denied the motions. See 99-12D, IHO Orders (September 14, 1999) and (December 9, 1999). The Respondents renewed their motion at the hearing and in their post-hearing briefs. As discussed fully under similar circumstances in In the Matter of John A. Matassa, Jr., IHO Order and Memorandum, 98-43D (May 12, 1999), the IHO denies the Motion for Recusal for the reasons which follow. In the present matter, the IHO had previously heard testimony in trusteeship proceedings and made findings regarding allegations about Respondents and the Chicago Outfit based on the evidence he heard. There is no evidence that the IHO has any bias against Respondents. Findings in a prior factual matter do not evidence partiality. Absent any other evidence of partiality, the fact that the IHO has made factual findings in a previous matter regarding Respondents does not demonstrate that the IHO is partial to one party or the other. As stated by the IHO in similar circumstances in In the Matter of John Matassa, Jr., when the IHO first hears a trusteeship proceeding then subsequently hears a disciplinary proceeding, arising from the trusteeship hearing, "the IHO acts similarly to a judge who conducts a hearing on a preliminary injunction and makes findings with regard to granting the injunction, and then later hears a civil case arising from the same facts." IHO Order and Memorandum, 98-43D (May 12, 1999). Both the LIUNA Appellate Officer and the United States District Court have previously upheld the 3 IHO in his refusal to recuse himself in a disciplinary proceeding following a trusteeship proceeding involving the same individuals. In the Matter of John A. Matassa, Jr., 99-009-IHO (December 9, 1999); John A. Matassa, Jr. v. Laborers' International Union of North America, No. 99C8158 (N.D.111. Aug. 29, 2000)(applying to the LIUNA IHO the judicial rule that "a judicial officer need not recuse himself because of knowledge gained under his judicial capacity in another case, so long as he bases his decision on the evidence presented in the case under consideration") citing United States v. Bond, 847 F.2d 1233, 1241 (7th Cir. 1988), overruled on other grounds, and Ruthlege v. United States, 517 U.S. 292 (1996). STANDARD OF REVIEW BY THE IHO In In Re Chicago District Council, the IHO made numerous findings concerning Respondents and other LIUNA members regarding organized crime association. The issue in the trusteeship case was whether organized crime had infiltrated the Chicago District Council and whether trusteeship was warranted for the protection of the membership and LIUNA assets. The instant matter involves Respondents as individuals, and the issue is whether conduct alleged by the GEB Attorney warrants disciplinary action.
Although the IHO made findings in In Re Chicago District Council regarding the Respondents, the IHO will examine all the evidence regarding Respondents de novo as it applies to each Respondent individually. The GEB Attorney's burden is, as in any LIUNA disciplinary matter, proof by a preponderance of the evidence. MOTION TO SEVER DIFORTI AND FRANK CARUSO Due to DiForti and Frank Caruso's lack of participation at the hearing, Bruno Caruso and Leo Caruso made a Motion to Sever DiForti and Frank Caruso. The IHO denied the Motion to Sever as he found no danger of spillover prejudice to Bruno and Leo Caruso. The IHO is 4 unaffected by the knowledge that Frank Caruso is Bruno Caruso's brother and Leo Caruso's cousin. The IHO does not give any weight to familial relationship between an individual associated with organized crime and a respondent based solely upon being related. EVIDENTIARY CONSIDERATIONS Robert Cooley's Appearance Limited to Counsel Robert Cooley is a protected witness whose current facial features and present identity have been modified and are closely guarded. Hearing Transcript (Tr.) 608, 611. The FBI made Cooley available to testify in person during the hearing on the condition that the only persons allowed to view his appearance be limited to the attorneys for the parties and the IHO. Tr. 603. Respondents' counsel objected to their clients not being permitted to view Cooley in person during his testimony. Tr. 601-616. The IHO determined that all interests could be properly balanced by having the IHO, counsel for Respondents, and the GEB Attorney present in the room with Cooley during his testimony. The Respondents were permitted to hear the entire testimony via telephone and were permitted to consult with their counsel at any time via telephone and in addition were given a recess to consult with their attorneys in person prior to Cooley's cross-examination. Tr. 618. Michael Corbitt's Testimony Michael Corbitt is a protected witness who for safety reasons testified via telephone from an undisclosed location. With the possible exception of security personnel, Michael Corbitt testified alone, without assistance from outside individuals. Tr. 770. Bruno Caruso and Leo Caruso objected to the testimony given by Michael Corbitt because he could not be placed under oath since the court reporter could not administer the oath by telephone. The IHO informed Corbitt that he still considered him to be under oath from prior testimony given in the CDC 5 proceeding where Corbitt had been sworn.2 Corbitt was subject to cross-examination as well as questioning by the IHO. During portions of Corbitt's cross-examination, Corbitt refused to answer questions regarding his contact-with a former Assistant United States Attorney in Florida and questions regarding whether he had been rewarded for testifying before the IHO in the CDC proceeding or would be rewarded in the future for cooperation in this hearing. The Respondents objected and moved to strike his testimony. The IHO required the GEB Attorney to put into the record Corbitt's reward, if any, for testifying before the IHO in the CDC Trusteeship Proceedings. The IHO concludes that Corbin's sentence was reduced for his prior cooperation. The IHO denied the Motion to Strike in his Order dated April 14, 2000. As explained fully in the April 14, 2000 Order, the IHO noted that a full and fair hearing in a LIUNA proceeding does not include the Confrontation Clause of the Sixth Amendment, and that striking the entire testimony is a drastic remedy within the discretion of the judge. The IHO found that Corbitt did respond to cross-examination on material points. (For more extensive findings and discussion see Order of April 14, 2000.) Charles "Guy" Bills's Testimony As Prior Testimony of an Unavailable Witness Charles "Guy" Bills (Bills) was scheduled to testify in the hearing before the IHO, but Bills died of a heart attack before he was able to do so. As a result, the GEB Attorney offered the transcript of Bills's testimony from the CDC proceedings. The Respondents objected to the use of the prior testimony. In his order of April 14, 2000, the IHO admitted Bills's testimony, finding that in the CDC proceedings there had been a predecessor in interest, motive, and _______________________- 2 In the hearing for the CDC trusteeship in 1997, Corbin testified in person before all attorneys at a federal correction facility in Florida.
6 opportunity such that it was appropriate to admit the testimony as prior testimony of an unavailable witness. See 99-12D, IHO Order (April 14, 2000). WITNESSES John J. O'Rourke _. John J. O'Rourke (O'Rourke) has been an inspector with the LIUNA Inspector General's (IG) Office since May 1996. Tr. 34-35. Prior to that time, O'Rourke served as a special agent for the Office of Naval Intelligence for six years and a special agent for the Federal Bureau of Investigation (FBI) for twenty-six years. Tr. 35. O'Rourke retired from the FBI in 1995 and spent over a year as an Inspector for the Cook County Sheriff's Office assigned full-time to the FBI task force in Chicago. Id. Of the thirty-two years O'Rourke spent in law enforcement, twenty-three years specifically involved investigating organized crime in the Chicago area. Tr. 35-36. O'Rourke worked in the FBI Chicago field office investigating Chicago organized crime from approximately 1974 until May 1996. Tr. 35. During that time, O'Rourke participated in several hundred organized crime related investigations in Chicago and played a role in seventy-five to one hundred organized crime convictions. Tr. 36. O'Rourke has also served as a field police instructor for the FBI, in which position he conducted seminars and classes in organized crime and hostage negotiations for local and federal law enforcement agencies. Tr. 37. O'Rourke personally participated in investigations of the organized crime 26th Street Crew from 1979 until 1984, then continued assisting with intelligence information until his retirement in 1995. Tr. 98-99. As one specific example, O'Rourke was the case agent on an investigation of extortion and credit transactions or loansharking, the subjects of which were Joseph "Shorty" LaMantia, Frank Caruso, Aldo Pisceitelli, and Fred "Bruno" Barbara. Tr. 148. As part of the investigation, O'Rourke had the opportunity to observe the interaction of those 7 individuals. Tr. 151-52. As part of these investigations and intelligence gathering, O'Rourke personally spoke with associates and members of the Chicago Outfit who provided information about the 26th Street Crew. Tr. 99.
The GEB Attorney called O'Rourke as an expert witness. The use of expert witnesses has been accepted previously in labor litigation resulting from the consent decree between the Department of Justice and the International Brotherhood of Teamsters (IBT). In United States v. International Brotherhood of Teamsters (Senese and Talerico), 745 F.Supp. 908 (S.D.N.Y. 1989), an FBI agent gave and the court accepted expert testimony relating to organized crime membership based upon his reading of FBI crime reports, his own notes from attending FBI debriefings, depositions, testimony of unnamed cooperating witnesses, and FBI physical surveillance. The IHO has adopted this procedure. See In the Matter of Charles Miceli, IHO Order and Memorandum 98-11D (May 27, 1999); In the Matter of Salvatore Franco, IHO Order and Memorandum 98-04D (October 6, 1998); In the Matter ofJohn Matassa, Jr., IHO Order and Memorandum 98-43D (May 12, 1999); In the Matter of Construction & General Laborers' District Council of Chicago & Vicinity, IHO Order and Memorandum 97-30T (February 7, 1998). Under this procedure, O'Rourke has previously been qualified and testified before the IHO as an expert in organized crime in the Chicago area. Tr. 37. See In the Matter of John Matassa, Jr., IHO Order and Memorandum 98-43D (May 12, 1999); In the Matter of Construction & General Laborers' District Council of Chicago & Vicinity, IHO Order and Memorandum 97-30T (February 7, 1998). The IHO finds that O'Rourke is a qualified witness, expert in criminal investigations and the structure of organized crime in Chicago, and his testimony, in conformance with accepted investigative techniques, is reliable. 8
In order to facilitate the proceedings, O'Rourke submitted an affidavit prior to the hearing indicating support for the opinion he rendered. Tr. 212. See GEB Ex. 105, Affidavit of John J. O'Rourke. O'Rourke prepared his affidavit based upon the results of interviews of cooperating witnesses and informants. Tr. 210. The practice of an expert witness submitting an affidavit based upon his conclusions and delineating the basis for those conclusions has been accepted in the disciplinary cases arising under the IBT consent decree in which former federal judge Fredrick Lacey acted as the hearing officer. See, e.g., United States v. International Brotherhood of Teamsters (Senese and Talerico), 745 F.Supp. 908 (S.D.N.Y. 1989). The affidavit did not substitute completely for O'Rourke's testimony. The affidavit was provided to Respondents' counsel before the hearing and in addition to the affidavit, O'Rourke appeared and testified extensively at the hearing. See Tr. 34-176, 189-525. O'Rourke's affidavit discussed the use of cooperating witnesses and confidential informants. A cooperating witness is a publicly identified individual who provides information about organized crime and agrees to testify in court. GEB Ex. 105, Affidavit of John J. O'Rourke. A confidential informant is an individual with information or in a position to obtain information who is not willing to be named publicly or testify. Tr. 44. Confidential informants are tracked statistically in various aspects of information supplied such as search warrants, Title III affidavits, and arrests. Tr. 44-45. The IHO's evaluation of the confidential informants are discussed infra. O'Rourke testified that he had personally interviewed six identified cooperating witnesses and eight confidential informants who provided information regarding Frank Caruso, Bruno Caruso, Leo Caruso, or James DiForti and organized crime. Tr. 105-07, 222-23, 234, 241; GEB Ex. 105, Affidavit of John J. O'Rourke. The cooperating witnesses O'Rourke relied upon are discussed in detail as follows. 9
Richard John Mara (Mara) was a member of the 26th Street/Chinatown crew who later cooperated with the FBI and was interviewed and debriefed extensively by O'Rourke. Tr. 105.Mara testified for the federal government in several federal criminal cases and is currently in the witness security program. Tr. 105, 106, 215. Mara was a burglar, armed robber, and cartage thief who worked for Ron Jarrett and Frank Calabrese collecting juice loans. Tr. 105, 215. O'Rourke interviewed Mara on September 1996 and May 1997, specifically concerning the influence of organized crime on LIUNA in the Chicago area. Tr. 216; GEB Ex. 105, Affidavit of John J. O'Rourke Tr 22.
O'Rourke testified that the information Mara provided to him was corroborated in part by Joseph LaMantia's plea agreement. Tr. 116-17. See GEB Ex. 48, Plea Agreement, United States v. Joseph Frank LaMantia, No. 93CR523-1 (N.D.Ill. September 26, 1996). Gerald H Scarpelli Gerald H. Scarpelli (Scarpelli) was the boss of James Peter "Duke" Basile, ran an enforcement crew, and was a hit man for the Ferriola crew. Tr. 106. O'Rourke and other agents attested Scarpelli in July 1998, after an extensive year-long investigation including consensual recordings made by Basile of meetings with Scarpelli and other members of the Ferriola crew. Id The night of Scarpelli's arrest, O'Rourke debriefed him extensively and Scarpelli agreed to cooperate with the FBI. Tr. 106-07. See also Ex. 37, FBI FD-302 of Gerald Scarpelli by SAs John J. O'Rourke and Thomas B. Noble of July 18, 1988. The information provided by O'Rourke regarding Scarpelli in the present matter was offered mainly as corroboration and
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10 organized crime background. Joseph Granata O'Rourke testified that Joseph Granata (Granata) was a member of organized crime and a participant in the Ferriola crew with contacts in other crews. Tr. 221. Granata's father and brother Frank were also members of organized crime. Id. O'Rourke spoke with Granata on many occasions while O'Rourke was in the FBI. Tr. 222. Granata made undercover drug buys from organized crime figures on behalf of the FBI which later resulted in convictions. Tr. 223. After Granata entered the Witness Security Program, O'Rourke continued to speak with him on a regular basis. Tr. 222. Since working for LIUNA, O'Rourke has spoken with Granata approximately twenty to thirty times, the most recent being the same month as the hearing [January 2000]. Tr. 223.
James Peter Basile
O'Rourke testified that James Peter "Duke" or "Dukey" Basile (Basile) was known to the FBI as a lifelong associate of organized crime both through his own admission and through investigation by the FBI. Tr. 233. Basile agreed to cooperate with the FBI in approximately 1986 and did so until he surfaced in 1988 due to the arrest of Gerry Scarpelli. Id. While cooperating with the FBI, Basile conducted numerous telephone conversations, personal meetings with members of organized crime, such as Gerry Scarpelli, James Inendino, Rocky Infelise, and Michael Same, and furnished money to these individuals during the meetings which were recorded on a body recorder and monitored by FBI agents. Id. Basile testified in trials resulting in convictions including those of Rocky Infelise and his crew, and of Albert C. Tocco, who was the boss of the Chicago Heights crew. Tr. 233-34. O'Rourke has personally spoken 11 with Basile over one hundred times and during a two-year period the FBI was speaking with and debriefing Basile on almost a daily basis. Tr. 234. William Jahoda
O'Rourke gave testimony regarding William Jahoda (Jahoda). However, O'Rourke testified that Jahoda had stated that he did not know the Respondents and that he had only heard some comments regarding allegations of organized crime and the Respondents. As Jahoda's information was vague and too removed from the Respondents, the IHO does not credit any of the testimony regarding Jahoda.
Umberto Filippi was an Italian immigrant residing in Chicago who held many jobs as a waiter and maitre d'hotel and provided information to the FBI. Tr. 244. Filippi eventually became the caretaker, chauffeur, cook, and valet to Salvatore Termini, a member of organized crime, also known as Sal Mango. Id. Mango operated a company called National Consolidated Industries (NCI) which supplied eyeglass services to the City of Chicago and labor unions. Id Due to his position as chauffeur and caretaker, Filippi was able to observe Mango's meetings with others. Id. Confidential Informants In addition to the named cooperating individuals, O'Rourke stated that he had received information from eleven confidential informants regarding the Respondents. O'Rourke utilized these statements to support his opinion that Respondents in this matter are associated with organized crime . The IHO will accept hearsay statements of informants under very limited and closely monitored circumstances. In the Matter of John Matassa, Jr., IHO 98-431); In re Chicago
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District Council, IHO 97-30T. The IHO will permit a professional law enforcement officer, or former law enforcement officer, to relate informant testimony as part of his opinion that an individual is a member of or associated with organized crime. In re Chicago District Council, IHO 97-30T. The information must be supplied by an organization with a defined and qualified informant program and there must be a demonstration that the informants have been qualified and classified by the organization. Not all law enforcement organizations will be accepted by the IHO as sources of informant information.
In this matter, O'Rourke's informants were all qualified and classified by the FBI. They had a demonstrated history of reliability. The testimony related by O'Rourke by these informants varied from being very specific to very general. The informant information, combined with other facts relied upon by O'Rourke was sufficient to satisfy the IHO that O'Rourke's opinion should be given substantial weight. Law Enforcement Testimony
In addition to O'Rourke's testimony, the GEB Attorney presented evidence from other law enforcement personnel, Ellwood Egan, Peter Dignan, John Dineen, and Brian Murphy, concerning surveillances in which they had participated. Their backgrounds and experience are discussed as follows. Ellwood Egan
Ellwood Egan (Egan) is a detective with the Chicago Police Department assigned to the FBI task force. Tr. 533. Egan has been involved in law enforcement for thirty-seven (37) years beginning as a patrolman until his promotion to detective at which time he began working in the homicide division in approximately 1967. Id. Egan worked in the homicide division for ten years then transferred to the Intelligence Division of the Chicago Police Department in the mid-
1970s, where he continued for approximately seventeen (17) years. Tr. 533-34. While with the Intelligence Division, Egan worked on organized crime related matters. Tr. 534. In 1988 or 1989, Egan was detailed to the FBI Task Force from the Chicago Police Department, a position he currently holds. TX. 535. Peter F. Dignan
Peter F. Dignan (Dignan) is a lieutenant with the Chicago Police Department currently assigned to the 21st District. Tr. 1015. Dignan began his law enforcement career on March 31, 1969, as a patrol officer, and after three years was promoted to detective where he worked for the homicide unit for thirteen (13) years. Tr. 1016. After the thirteen-year period, Dignan served as a detective in the narcotics section for three (3) years, was promoted to sergeant in 1988, went to the patrol division for eighteen (18) months, and returned to the narcotics section as a sergeant for four (4) years. Id. Afterwards, Dignan served in the gambling unit, for approximately seven or eight months, where he investigated illegal gambling, syndicated gambling, organized crime, and related matters. Tr. 1016-17. After the gambling unit, Dignan was transferred to the intelligence section where his responsibilities included investigating crimes of a sensitive nature having to do mostly with organized crime. Tr. 1017-18. In 1998, Dignan was promoted to lieutenant and returned to the patrol division. Id. During the course of his career, Dignan has conducted approximately one thousand surveillances. Tr. 1018. Dignan has surveiled members of organized crime including Frank Sweis, John Monteleone, Alfonse Tornabene, and John Matassa. Tr. 1021 . John Dineen and Brian Murphy
An agreement was made among the GEB Attorney and counsel for Respondents that the testimony of John Dineen and Brian Murphy in the CDC proceeding would be admitted into
14 evidence in this case as if they had testified live on direct, with both witnesses being available to be fully cross-examined at the hearing. Tr. 188.
John Dineen is an inspector on the staff of the LIUNA Inspector General. Tr. 288-89. Prior to working for ,LIUNA, Dineen spent thirty-eight years on the Chicago Police Department. Tr. 289. Cooperating Former Organized Crime Associates
Three individuals, Robert J. Cooley, Michael Corbitt, and Charles Francis Bills, were formerly heavily involved with organized crime activities and socializing with organized crime associates and members. The three individuals all cooperated with law enforcement and became protected witnesses testifying at different trials. Their backgrounds are discussed as follows. Robert J. Cooley Robert J. Cooley (Cooley) was an attorney in Chicago for approximately eighteen (18) years, from 1970 to 1989, during which time he represented many individuals in organized crime and also spent a ten (10) year period in which he socialized with organized crime individuals approximately four to five times a week. Tr. 622-23. Cooley gambled heavily with organized crime bookmakers in Chicago during approximately eighteen (18) years in the 1970s and 80s, Tr. 623, 647. Cooley testified that during some portions of his gambling period, he placed bets worth over a million dollars a week with dozens of different bookmakers at the same time. Tr. 623-24. Cooley represented members of the Chicago Outfit, fixed cases for them by bribing judges to assure an outcome in a case, and made connections between them and some of the politicians in the city for different matters. Tr. 624. During a three (3) year period of time, from 1977 until almost 1981, Cooley testified that he was law partners with former state senator John D'Arco, and was involved in illegal activity nearly every day. Tr. 624-25. In 1981, Cooley 15
broke away from John D'Arco and opened a legitimate law office only occasionally getting involved with illegal activities when requested to do so by Pat Marcy4 or others. Tr. 625. Cooley became involved with bookmaking through an individual named Roland Borelli, then met Marco D'Amico with whom he placed bets and began betting on sporting events with Chicago Outfit bookmakers. Tr. 628-29. Cooley's statement as to his participation in the Chicago Outfit's illegal gambling operations are corroborated by the information provided in the guilty pleas of Robert M. Abbinanti and Roland Borelli. Both Abbinanti and Borelli described their participation in the illegal gambling and their knowledge of Cooley's participation:
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Cooley opened a restaurant with another individual named Arty Greco, which became a popular meeting location for organized crime figures and politicians, and as a result, Cooley began meeting many more individuals from the different factions of the Chicago Outfit. Tr. 639, In addition to legitimate patrons, the clientele at Greco's included Angelo LaPietra, John "Jackie" Cerone,s Joe Lombardo, hit men, auto thieves, and members from every crime family faction in the area. Tr. 640. In approximately 1977, Cooley began to practice law with John D'Arco in the First Ward. Tr. 638, 641. During the three an one half year period between 1977 to 1981, when he began practicing law with John D'Arco, he was involved with Pat Marcy, John D'Arco, Sr., and Fred Roti. Tr. 641. Cooley stated that "it became almost like I was one of them at that time." Id. Cooley also stated that he was gambling almost every day during this time period and that his gambling continued during the 1970s and 1980s. Tr. 642, 647.
As a former case agent on an investigation of John Peter "Jackie" Cerone (Cerone) in the mid-1980s, O'Rourke testified that Cerone was the longtime chauffeur and bodyguard for Anthony Accardo, became underboss of the Chicago outfit, and was identified by informants through surveillance and wiretaps as a made member of organized crime and by cooperating subjects as a top leader of organized crime in Chicago. Tr. 84, 85. Cerone was convicted, along with Joseph John Aiuppa, Joseph Lombardo, and Angelo LaPietra, on conspiracy and gaming laws violations charges and sent to prison in approximately 1986. Tr. 84. See also GEB Ex. 21, United States v. Cerone, 830 F.2d 938 (8th Cir. 1987). 17
In 1977, Pat Marcy and John D'Arco, Sr. asked Cooley to defend and fix a state case for Harry Aleman, one of the main hit men of the Chicago mob. Tr. 642-43. Cooley did so and Aleman was found not guilty. Tr. 643. Cooley testified that he had paid Judge Frank Wilson $10,000 and was later reimbursed for that sum by Pat Marcy. Id. Years later, Cooley gave the information regarding his activities in fixing the Aleman case to federal authorities, the case was reopened, and Harry Aleman was subsequently convicted .b Tr. 644. Cooley stated that his fixing of the Aleman case had heightened his stature among individuals such as Marco D'Amico and other individuals associated with organized crime, and he began receiving more business from all the different crime family factions. Tr. 645-46. In the late 1980s, Cooley began cooperating with the FBI. Over a period of three and a half years, beginning in approximately March 1986 until November 1989, Cooley wore a body wire and recorded hundreds of conversations with organized crime individuals in the Chicago area. Tr. 621-22. Cooley testified in seven federal trials and the information he provided also resulted in part in another seven plea agreements. Tr. 620. The cases in which Cooley testified concerned corruption in the court system and interconnection between organized crime in Chicago and its involvement with either the court system or other racketeering activities. Tr. 621, Cooley's gambling in the organized crime syndicate, fixing cases, legal work for the mob, ownership of Greco's,' and heavy socializing with organized crime members enabled him to have a close view of the mob and familiarity with a number of the mob's members and ____________________________ 6 Since Harry Aleman himself had been involved in the case-fixing, he was able to be tried twice for murder. When Cooley surfaced as an informant, Judge Wilson committed suicide. Tr. 646. ' Cooley had partial ownership of Greco's restaurant for approximately five or six years beginning in 1975 or 1976. Tr. 733. 18
associates. Tr. 650-51. During the late 1970s, Cooley constantly socialized publicly with organized crime individuals he identified as Pat Marcy, Jackie Cerone, Marco D'Amico, Harry Aleman, Butchie Petrocelli, Tony Boresellino,s and individuals from the 26th Street crew, including Larry Pusitcri and Richie Catazone. Tr. 652-54.
Cooley testified that he gained his knowledge of who was in the organized crime hierarchy from daily conversations over years with a series of different people from the different factions of the mob. He said that it was important for him to know the hierarchy of the mob for his own safety and security, because the risk of insulting somebody at a top level of organized crime was dangerous. Tr. 655-56, 723.
The IHO finds that Cooley had been heavily involved with organized crime and that Cooley had been in such a position as to know the participants of organized crime and their relative positions within the organization. Cooley cooperated in several federal trials at a danger to himself, and Cooley's information has been verified independently and has been found to be credible. The IHO finds Cooley's testimony at the hearing to be credible. Michael Corbitt
Michael Corbitt was involved with organized crime in Chicago for a period of approximately thirty (30) years, from the time he was seventeen (17) years old until he was convicted and incarcerated in October 1987, and sentenced to twenty (20) years imprisonment. Tr. 772-73. From approximately 1960, when Corbitt was eighteen (18) years old, to 1964 or 1965, he worked at a gas station in Summit, Illinois, where several different crews of organized came used his storage facility for storing stolen material which had been hijacked from trucks.
8 Cooley stated that Tony Boresellino was a hit man for the North Side crew and that Cooley had been with him the night Boresellino was later killed. Tr. 654.
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Tr. 774. Corbitt provided the space in return for payment. Id The individuals using Corbitt's storage were acting under the authority of Sam Giancana9 and Marshall Caifano, leaders of the Chicago Outfit. Id When Corbitt was due to become unemployed because the gas station was going to be sold by the owners, Sam Giancana approached him' ° and asked him if he wanted a new job as a police officer. Tr. 775. Giancana told Corbitt to meet with then mayor John Rust of Willow Springs, and after one meeting with Rust, Corbitt was appointed to the police department in approximately late 1964 or early 1965. Tr. 776. After Corbitt had become a police officer, Giancana arranged to meet Corbitt at a restaurant and told him to "remember who [his] friends are." Tr. 777.
In 1973, Corbitt was named chief of police of Willow Springs and remained there until 1981 when he became a full-time member of an organized crime crew from the north side. Id. Corbitt remained as a sworn Sheriff s police officer and carried a badge and gun until his indictment in 1986. Tr. 778. Corbitt stated that he was able to continue as a police officer from 1981 to 1986 despite his full time activities as an organized crime member because he was given a no-show investigator's job. Id Corbitt testified that he engaged in organized crime activity during his entire time as a police officer. Tr. 778-79.
As one of his organized crime activities, Corbitt acted as a courier of organized crime money. Tr. 782, 789-90. Corbitt stated that among the persons from whom he had received payment were A1 Pilotto, Joe Ferriola, John Monteleone, and Gerald Scarpelli. Tr. 782. Corbitt also stated that, between 1976 and approximately 1985, he delivered money to individuals
9 At the time Giancana was one of the top leaders of the Chicago Outfit. He eventually became the boss of the outfit. A contemporaneous crime writer described Ciancana as "the most powerful archcriminal in the world." Ovid Demaris, Captive City 4 (1969). '° At the time, Corbitt was twenty years old.
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including Tony Accardo, Joey Aiuppa, Vincent Solano, Gus Alex, and Pat Marcy. Tr. 790.
Corbitt was in a position to be familiar with the individuals and their positions within organized crime because he dealt with them on a daily basis, facilitated the activities that they needed to be done, such as picking up money for bribing government officials from individuals involved in illegal activities in the community, running record checks on suspected surveillance vehicles, and performing electronic wiretaps and surveillances. Tr. 780-81. Corbitt testified that because he was dealt with and was around members of organized crime on a daily basis from the time he was seventeen (17) years old, he needed to know the structure and identity of people within the Chicago Outfit for both his legal protection and personal safety. Tr. 783-85, 788-89.
The IHO finds that Corbitt had been heavily involved with organized crime and that Corbitt had been in such a position as to know the participants of organized crime and their relative positions with the organization. Corbin's information was detailed, and corroborated by other evidence of record and other witnesses. The IHO found Corbitt's testimony at the hearing to be credible. Charles Francis "Guy" Bills
As discussed supra and in the IHO's April 14 Order, Charles Francis "Guy" Bills (Bills) was scheduled to testify before the IHO in this matter, however, Bills died of a heart attack before the hearing. The IHO accepted his testimony of July 22, 1997, in the Chicago District Council case, as prior testimony of an unavailable witness.
Bills was involved with the Chicago Outfit, specifically the 26th Street Crew with Angelo LaPietra, from approximately 1977 to the early 1980s. CDC Transcript of July 22, 1997 (CDC Tr.) 1110. Bills testified that his organized crime activities included loaning money on the street on behalf of Angelo LaPietra's crew, collecting street tax for both Angelo LaPietra and Albert
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Tocco's crews, stealing vehicles, operating his own chop shop and owning a junk yard to process the stolen vehicles, cartage theft, working in his father's bookmaking office. CDC Tr. 1112-19, 1172.
Bills cooperated with the FBI and met with organized crime individuals for recorded meetings. CDC Tr. 1109. Bills testified in two federal criminal trials regarding organized crime in Chicago, specifically street taxes and juice loans. CDC Tr. 1107-09. Bills was placed in the witness protection program. CDC Tr. 1107.
Bills testified that as someone involved in illegal activity, it was very important for him to be aware of the leadership and hierarchy of organized crime for his own protection. CDC Tr. 1132-1135. Bills's testimony was detailed, consistent, and corroborated by other witnesses and evidence. Bills's information has been verified independently and has been found to be reliable. The IHO finds Bills to be a credible witness. HEARSAY EVIDENCE
The IHO must base his decisions on reliable evidence through a review of what is probative and reliable. Reliable hearsay evidence is admissible in labor arbitrations. Associated Cleaning Consultants and International Brotherhood of Printing and Allied Trades Local 327, 94 LA 1246 (1990); In the Matter ofJoseph P. Crincoli, IHO Order and Memorandum, 97-04D (Oct. 27, 1997); In Re Chicago District Council, IHO 97-30T; Elkouri and Elkouri, How Arbitration Works (4`s ed. 1994). Hearsay evidence has been admitted regularly in union disciplinary proceedings arising under the Teamsters Consent Decree. United States v. IBT(Cimino), 964 F.2d 1308 (2d Cir. 1992), at 1312, affg United States v. IBT(Cirnino), 777 F.Supp. 1130 (S.D.N.Y. 1991); United States v. IBT (Senese & Talerico), 941 F.2d 1292 (2d Cir. 1991), at 1297, affg United States v. IBT (Senese & Talerico), 745 F. Supp. 908 (S.D.N.Y.
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1990). The test is whether the evidence is reliable. Senese & Talerico, 941 F.2d at 1298 (citing Richardson v. Perales, 402 U.S. 389, 402 (1971)). FINDINGS OF FACT Organized Crime ,,
1. The FBI defines organized crimell as a formally structured group whose objective is to obtain money through illegal activities and by the use of fear, violence, extortion, and graft. Tr. 47-48. Organized crime is in the business of crime for a profit. Tr. 48.
2. La Cosa Nostra (LCN) is also known as the "mob" or the "Mafia" and is one of the major organized crime groups in the United States. Id
3. Organized crime activities include illegal gambling: sports betting, crap games, and card games; activities which in turn support loansharking or "juice loans" 12 at high rates of interest. Tr. 54.
4. Bookmakers either work directly for certain organized crime figures or are independent bookmakers who pay a street tax and/or are fifty per cent (50%) partners with organized crime individuals. Tr. 629.
5. Other organized crime activities include extortion from illegal businesses, known as "street tax," 13 and labor racketeering. Tr. 54.
++++++++++++++++++++++++++++++++++++++++ 23 6. Cooley described a street tax as payment of a certain amount of money required by organized crime figures of persons operating any illegal activity in the city, such as stealing cars, bookmaking, burglary, or fencing, to keep from either being beaten or killed. Tr. 649.
7. The.LCN utilizes its control of labor unions to neutralize competitive bidding and extort employers for labor peace. See generally, GEB Ex. 1-2. "Sometimes control arises from members of La Cosa Nostra who are also labor officials. Control includes the ability to direct the day-to-day affairs of a labor organization--such things as ...who runs for office and who does not, who gets elected to union office...and the use of union power for corrupt purposes." GEB Ex. 2, The Edge: Organized Crime, Business and the Labor Unions, President's Commission on Organized Crime, Report to the President and the Attorney General, at 6.
8. The LCN is organized into groups known as families. The head of the family is known as the boss. Tr. 58. The boss is assisted by an underboss and by an advisor known as the consigliere. Id Individuals within the family are divided into smaller groups of soldiers called crews each headed by a lieutenant. Tr. 58-59.
9. A made member is an individual who has undergone a secret ceremony 14 and can share in the profits of organized crime. Tr. 51. An associate of organized crime is an individual who falls into one of two categories. The first type of associate is an individual known as a soldier who performs the daily functions of organized crime such as collecting gambling debts, enforcing threats, collecting street tax, delivering money up the chain to the bosses, conducting surveillance, and engaging in murder on orders of organized crime. 1d. The other type of associate is an individual who assists organized crimes by doing favors, such as corrupt police
1° The initiation process of the LCN was described in detail by an LCN associate in United States v. Pungitore, 910 F.2d 1084, 1097 (3d Cir.), cert. denied, 500 U.S. 915 (1990).
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officers, attorneys, business owners, and labor leaders. Id. Associates work for or in conjunction with made members to provide income for the organized crime family. Tr. 298.
10. When an individual becomes a made member, the fact of his becoming made spreads quickly in the organized crime community because he is entitled to a certain amount of respect. Tr. 53.
11. The FBI maintains an inventory of members and associates of organized crime. GEB Ex. 105, Affidavit of John J. O'Rourke. In order for the FBI to qualify an individual as an made member of organized crime, one of the following scenarios must be verified: either two known members must talk about a third individual as a made member on an FBI wiretap or in front of an undercover agent, or two qualified organized confidential informants must independently identify an individual as a made member. Tr. 53.
12. The LCN follows a code of conduct which includes: following the orders of
superiors without question, not providing information or assistance to law enforcement, paying
assessments imposed by superiors, respecting other members regardless of personal feelings, and
not disclosing anything about the organization to outsiders. Tr. 49-50. GEB Ex. 105, Affidavit
of John J. O'Rourke.
The Chicago Outfit
13. The GEB Attorney introduced several exhibits to demonstrate the existence and structure of organized crime in Chicago. See e.g., GEB Ex. 1-3. The IHO has previously discussed a detailed history of organized crime in general, its background in Chicago, and its structure. See e.g. In re Chicago District Council, IHO 97-30T and Fallacara, IHO 96-651).
14. The Chicago area faction of the LCN is known as the Chicago Outfit. Tr. 48. The Chicago Outfit is comprised of operating crews. Tr. 64. The crew structure in Chicago is
based on geography, with different areas of the city being operated by different crews. Id. Examples of different geographical crews include the Cicero crew, the 26th Street/Chinatown crew, the Elmwood Park Crew, the North Side/Rush Street crew, the Grand Avenue crew, the Chicago Heights crew, and the Melrose Park crew. Ex. 37, FBI FD-302 of Gerald Scarpelli by SAs John J. O'Rourke and Thomas B. Noble of July 18, 1988.
15. The 26th Street Crew was centered around the old Italian neighborhood at 26th Street and Princeton Avenue in Chicago, and was also known as the Chinatown crew. Id Cooley testified that the 26th Street crew was involved in hijacking, loan-sharking, gambling, and many killings which took place in the Chicago area. Tr. 659.
16. Cooley testified that the Hungry Hound was a hot dog stand on 26th Street a few blocks west of Wentworth and was a convenient meeting place for the main organized crime family in the area. Tr. 657-58.
17. The Respondents in this case were alleged to have associated with several individuals connected to the 26th Street crew. In order to facilitate an understanding of the significance of these allegations, and to provide a better frame of reference, the following is a brief summary of some relevant Chicago Outfit individuals.
Marco D Amico
18. O'Rourke testified that Marco D'Amico was a principal member of the Elmwood Park crew, was a long time member of the Chicago Outfit, and owned several hot dog stands throughout the north side of Chicago. Tr. 132; see also Ex. 37, FBI FD-302 of Gerald Scarpelli by SAs John J. O'Rourke and Thomas B. Noble of July 18, 1988. O'Rourke further testified that D'Amico had been the object of an investigation by the FBI, was indicted, pled guilty, and is currently in federal prison. Tr. 132.
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19. Cooley testified that during his last three years in night law school, while working
as a policeman during the day, he became involved with Marco D'Amico and became very
friendly with him going out socially together two or three nights a week. Tr. 633. Cooley
testified that when he: originally met- Marco D'Amico, in 1967 or 1968, he thought Marco
D'Amico was merely a bookmaker. Tr. 629-30. However, through time, Cooley learned that
Marco D'Amico was very well connected with the organized crime family in the Elmwood Park
area, and in charge of many gambling operations for a large number of the bookmakers
throughout the city. Tr. 629-31. Cooley began playing cards at Cooley's house, going to
D'Amico's social club once or twice a week, and drinking three or four nights a week with
D'Amico and his friends at different bars and clubs. Tr. 633-34. When Cooley graduated from
law school and passed the bar examination, he immediately began receiving a substantial
quantity of legal business from D'Amico and was introduced to many other organized crime
figures in the city through him. Tr. 630, 635.
20. Cooley testified that Marco D'Amico began referring gambling cases and other cases to him which D'Amico indicated were from the 26th Street Crew, which Cooley knew to be trite because the individuals had been arrested in that vicinity. Tr. 638.
Frank "Skids" Caruso
21. Frank "Skids" Caruso is the father of Respondents Frank Caruso and Bruno Caruso, and the uncle of Respondent Leo Caruso. Skids Caruso was the boss of the 26th Street crew from the 1950s to approximately 1980. Bills testified that his father had been partners with Skids Caruso in a bookmaking operation in the 26th Street area. CDC Tr. 1124-26. Upon Skids Caruso's death, Angelo LaPietra became the boss of the 26th Street crew.
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Angelo LaPietra
22. Based upon his interviews and investigations, and review of FBI files at the time, O'Rourke testified that Angelo LaPietra was the boss of the 26th Street/Chinatown/Southside crew from approximately 1980 until his imprisonment in 1986. Tr. 79, 99, 100. See also GEB Ex. 54, FBI FD-302 report of Richard Mara by SA Ray Shyrock. Angelo LaPietra was convicted of conspiracy 15 to travel in interstate commerce and use interstate facilities with the intent to promote hidden financial and management interests in casinos in violation of Nevada gaming laws. GEB Ex. 21, United States v. Cerone, 830 F.2d 938 (8th Cir. 1986). Part of the financing for the casinos was done through the Teamsters Union pension funds. Id After his incarceration, Angelo LaPietra was replaced as boss by his brother James LaPietra. Tr. 99-100, 108. After James LaPietra died, he was replaced by John Monteleone. Tr. 99-100.
23. Cooley testified that it was his understanding that Angelo LaPietra was the head of the 26th Street Crew and a vicious and feared individual. Tr. 715. Cooley testified that based upon his interactions with the mob as someone who gambled with them, fixed cases for them, and heavily socialized with them, it was made clear to him that Angelo LaPietra was the ultimate boss of the crew. Tr. 723-24. |