v, ) No.

Violations: Title 18,

United Stales Code,

WILLIAM A. HANHARDT, ) Sections 371, 1962(d),

JOSEPH N. BASINSKI, ) 2314 and 2315.

PAUL ,I. SCHIRO, )

SAM DESTEFANO, )

BUY ALTOBELLO, and )

WILLIAM R. BROWN. )

COUNT ONE

The SPECIAL JANUARY 1999-1 GRAND JURY charges:

1. At all times material to this indictment:

(a) From July 13, 1953, until his retirement on pension as a captain on March 26, 1986, defendant WILLIAM A. HANHARDT was employed by the Chicago police Department (CPD"), and held several supervisory positions, including Chief of Detectives, Chief of Traffic, Commander of the Burglary Section, Deputy Superintendent for the Bureau of Inspectional Services, and District Commander. For a portion of the period of the indictment until the date of the indictment, defendant HANHARDT resided at 835 Heather Road, Deerfield, Illinois.

(b) Defendant GUY ALTOBELLO was employed by Altobello Jewelers, Inc., a retail jewelry store located at 100 East Roosevelt Road, Store 19, Villa Park, Illinois. ALTOBELLO's duties included meeting with traveling wholesale jewelry salespersons to

discuss, examine and make wholesale purchases from their jewelry lines. (c) The Hyatt Corporation was an Illinois corporation. Among other things, it operated the Hyatt Regency Columbus Hotel at 350 North High Street, Columbus, Ohio, which was near the Greater Columbus Convention Center, providing accommodations to travelers. As a service to its guests, the Hyatt provided the use of safety deposit boxes located in a room near the registration desk. (d) In August 1994, the Greater Columbus Convention Center hosted the 1994 Mid-America Jewelry Show. Many of the attending jewelers stayed at the Hyatt Regency Columbus Hotel. The following entities, which engaged in and had activities that affected interstate commerce, sent representatives to the 1994 Mid-America Jewelry Show, and had representatives who utilized safety deposit boxes at the Hyatt Regency Columbus Hotel: (i) Topaz Diamonds, Inc., a New York corporation, was located at 580 Fifth Avenue, New York, New York. (ii) World Diamond Imports, Ltd., and D&R J7jamond Importers, Inc., were Arizona corporations that were located at 6900 East Camelback Road, Scottsdale, Arizona. (iii.) Ragar Company was a partnership in New Jersey. (iv) Jewel-Que, Inc., doing business as Jeweltique, was a New York corporation located at 15 West 47^th Street, New York, New York.

(v) M.B. Saxon Co., Inc., was an Ohio corporation.

(vi) Ross & Shech7-er Diamonds Ltd., doing business as Genesis II, was a New York corporation located at 580 5°° Avenue, Suite 911, New York, New York.

(vii) Marsha's 14 Karat Gold Jewelry, was a sole

proprietorship located in Ohio.

(viii) The Gemological Institute of America was a nonprofit educational organization of the jewelry industry in the United States.

(e) The following entities were all also involved in the jewelry industry and were engaged in and had activities that affected interstate commerce:

(i) Baume & Mercier, Inc. was a corporation organized and existing under the laws of Switzerland. Its subsidiary, Baume & Mercier, was a Division of VLG North America, Inc., located at 663 Fifth Avenue, New York, New York.

(ii) Nafco Gems, Ltd. ("Nafco") was an Arizona corporation located in Scottsdale, Arizona.

(iii) Mayfield's Company was an Arizona corporation located in Scottsdale, Arizona.

(iv) Mikan, Inc., was a Delaware corporation located in Miami, Florida. Mikan, Inc. also had an office in Israel.

(v) Dennis D. Naughton Jewelers, doing business as Naughton Jewelers, was an Arizona corporation located at 37.72 Camelback Road, Phoenix, Arizona.

(vi) Gaston Jewelers Inc. was an Arizona corporation located at 3602 West Hell Road, Glendale, Arizona.

(vii) Golden Rule Jewelers, Inc., doing business as "Jewelry by Albert," was an Arizona corporation. After August 22, 1996, it was located at 8220 North Hayden Road, Suite 111. Before August 22, 1996, it was located at 8180 North Hayden Road, Suite lo2D, Scottsdale, Arizona.

(viii) Smith Fine Jewelers, Inc. was an Arizona corporation. After October 1997, it was located at 7704 East Doubletree

. Ranch Road, Scottsdale, Arizona. Before October 1997 it was

located at 8989 East Via Linda, Suite 106, Scottsdale,

Arizona.

(ix) Molina, Inc., doing business as Molina Fine Jewelers, was

an Arizona corporation located at 3134 East Camelback Road,

Phoenix, Arizona.

(x) Elan Ltd. was located at 589 5`h Avenue, Suite 1501, New

York, New York.

(xi) Kobi Katz, Inc., doing business as Baguette World, was a

California corporation located at 640 South Hill Street, Suite

851, Los Angeles, California.

(xii) Lieber & Solow Ltd. was a Delaware corporation located at 1140 Avenue of Americas, New York, New York.

(xiii) ESY, Inc. was a New York corporation located at 30 West 47 `h Street, Suite 601, New York, New York.

(xiv) Yahalom Inc., doing business as Baguettes USA, was a California corporation located at 550 South Hill Street, Suite 725, Los Angeles, California.

(xv) J. Schliff and Sons, Inc., doing business as Gem Platinum Manufacturing Company (hereafter "Gem Platinum") was a New York corporation located at 48 West 48`" Street, New York, New York.

(xvi) Solar Diamonds, Inc, was a New York corporation located at 580 5th Avenue, New York, New York.

(xvii) Advanced Ring Manufacturing Company through 1986 was a company located at 145 West 45th Street, New York, New York.

(xviii) Oscar Heyman & Brothers, Inc., was a New York corporation located at 501 Madison Avenue, 15th Floor, New York, New York.

(xix) DeBella Fine Gems and Jewelry was a New Mexico corporation located at 100 East Palace Avenue, Santa Fe, New Mexico.

(xx) .Rolex Watch USA, Inc., was a New York corporation

located at 665 5th Avenue, New York, New York.

(xxi) Horizon Imports was an Illinois corporation located

at 5 south Wabash, Chicago, Illinois.

(xxii) H, K. Ma11ak, Inc., was a New York corporation located

in Great Neck, New York.

(xxiii) Phillip Wolman & Co. was a California corporation

located at 550 South Hill Street, Los Angeles, California.

(xxiv) Gordon Brothers Corporation was a Massachusetts

corporation located at 40 Broad Street, Boston, Massachusetts.

(f) From January 31, 1996, through February 6, 1996, the

American Gem Trade Association ("AGTA") held its annual convention

at the Tucson Convention Center, in Tucson, Arizona. This

convention was open only to members of the Association, not to the

general public. From February 7, 1996 through February 11, 1996,

the Tucson Gem and Mineral Society held its trade show at the

Tucson Convention Center which the trade show was open to the

general public. Throughout the same two week period, several

hotels in Tucson, including the Holiday Inn at 181 West Broadway,

Tucson, Arizona, held smaller jewelry shows,.

(g) From May 29, 1996, through June 4, 1996, the jewelers Circular Keystone ("JCK") held its annual JCK International Jewelry Show at the Sands Expo and Convention Center in Las Vegas, Nevada. This show was open to members of the jewelry trade only, not to the general public.

(h) The Great Lakes Jewelry Show took place on August 24 and 25, 1996, at the Marriott Lincolnshire, Lincolnshire, Illinois.

7. THE ENTERPRISE

2. At all times material to this indictment, there existed a criminal organization, i.e. a group of individuals consisting of defendants WILLIAM A. HANHARDT, JOSEPH N. BASINSKI, PAUL J. SCHIRO, SAM DESTEFANO, GUY ALTOBELLO and others known and unknown, including James D'Antonio and Robert Paul, both now deceased. This group of individuals associated together for the purpose of engaging in an organized plan and scheme to gather information on individuals involved in the jewelry industry for the purpose of committing thefts of jewelry and disposing of the stolen jewelry, at times gathering such information from law enforcement and commercial databases by utilizing intrastate and interstate wire communications- This group of individuals, hereinafter known as "the enterprise," constituted an "enterprise" as that term is used in Title 18, United States Code, Section 1961(4), that is, a group of individuals associated in fact, which enterprise was engaged in and the activities of which affected interstate commerce.

3. The enterprise existed primarily to provide inC6me t6 certain of its members through illegal activities.

4. In order to carry out its activities, the enterprise utilized individuals employed by and associated with it who had

varying roles and responsibilities. The roles and responsibilities

were as follows:

DEFENDANT WILLIAM A. HANHARDT

(a) Defendant WILLIAM A. HANFLARDT (hereafter "HANHARDT^), was the leader of the enterprise. In that capacity he supervised codefendant JOSEPH N. HASINSKI and together they directed the activities of others employed by and associated with the enterprise- HANHARDT directed the other defendants and others in their gathering of information on potential jewelry theft victims and the surveillance of several such individuals. He utilized certain CPD officers to do database searches of CPD and other law enforcement computers to obtain information concerning jewelry salespersons. Similarly, he caused a private investigator to conduct credit bureau database searches and other database searches to gather information concerning individuals who were traveling jewelry salespersons. At times, HANHARDT used the telephone at his residence at 835 Heather Road, Deerfield, Illinois, to direct certain defendants and others to further the interests of the enterprise. HANHARDT personally participated in the theft of jewelry.

DEFENDANT JOSEPH N. BASINSKI

(b) Defendant JOSEPH N. BASINSKI (hereafter "BASINSKI") served the enterprise by identifying potential targets for the enterprise, including owners of or salespersons to jewelry stores

or businesses, by physical surveillances, telephone calls, database searches 'and other means. He would physically follow and surveill potential victims or locations for the purpose of stealing high quality jewelry. He assisted the enterprise by directing and

assisting in directing the activities of one or more of his codefendants in accomplishing the aims of the enterprise, including directing their activities on physical surveillances of locations and individuals and also the actual theft of jewelry. He also served the enterprise by maintaining information an potential victims of the enterprise and certain tools and instrumentalities of the enterprise, BASINSKI personally participated in the theft of jewelry.

DEFENDANT PAUL J. SCHIRO

(c) Defendant PAUL J. SCHIRO (hereafter "SCHIR0") served the enterprise by, among other things, conducting physical surveillances of jewelry stores, jewelry shows, owners of jewelry stores, and jewelry salespersons. SCHIRO personally participated in the theft of jewelry.

DEFENDANT SAM DESTEFANO

(d) Defendant SAM DESTEFANO (hereafter "DESTEFANO") served the enterprise by, among other things, conducting physical surveillances of jewelry stores, owners of jewelry stores, and jewelry salespersons. DESTEPANO personally participated in the theft of jewelry.

DEFENDANT GUY ALTOBELLO

(e) Defendant GUY ALTOBELLO (hereafter "ALTOBELLO)

served the enterprise by providing one or more of his co-defendants with information concerning jewelry salespersons that conducted business with Altobello Jewelers, Inc., so that certain of his codefendants could further identify such persons and determine the most opportune occasion to steal jewelry from such persons.

JAMES D'ANTONIO

(f) Until his death in December 1993, James D'Antonio was a coconspirator and served the enterprise by, among other things, maintaining information of traveling jewelry salespersons and maintaining various tools and instrumentalities . of the enterprise.

ROBERT PAUL

(g) Robert Paul, now deceased, was a coconspirator and served the enterprise by conducting physical surveillance of jewelry stores and jewelry salespersons in Arizona and by providing a cellular telephone used by his coconspirators.

II. THE RACKETEERING CONSPIRACY

S. Beginning in or about the early 19BOS and continuing thereafter to in or about April 1998, the exact dates being to the Grand Jury unknown, at Chicago in the Northern District of Illinois, Eastern Division, and elsewhere,

WILLIAM A. HANHARDT,

JOSEPH N. HASINSKI,

PAUL J. SCHIRO,

SAM DESTEFANO, and GUY ALTOBELLO,

defendants herein, being persons employed by and associated with an enterprise, that is, the enterprise as described in Paragraph 2 above, which enterprise engaged in, and the activities of which affected, interstate commerce, did knowingly conspire together and with other persons known and unknown to the grand jury, to conduct and participate, directly and indirectly, in the conduct of the affairs of the enterprise through a pattern of racketeering activity as those terms are defined in Title 18, United States Code, Section 1961 (1),in violation of Title 18, United States Code, Section 1962(c), as further specified in Paragraphs 6 and 7 below,

6. The racketeering activity consisted of:

(a) Transportation of stolen goods of the value of $5000 or more in interstate commerce, in violation of Title 18, United States Code, Section 2314.

(b) Receipt, possession, concealment, storage, sale and disposal of stolen goods of the value of $5,000 or more, which had

crossed a state boundary after being stolen, knowing the same to have been stolen, in violation of 'title 18, United States Code, Section 2315.

7. As part of the conspiracy, each of the defendants and others agreed that a Conspirator would commit at least two acts of racketeering in the conduct of the affairs of the enterprise.

III. MANNER AND MEANS OF THE CONSPIRACY

8. Among the manner and means of the conspiracy agreed to by the defendants and others, were the following:

(a) It was part of the conspiracy that one or more of the conspirators would and did steal jewelry and cause-some or all of said jewelry to be transported in interstate commerce, including the following:

1) The theft from the vehicle of a salesperson for

Baume & Mercier, -Inc., of approximately 180 watches

having a total value of approximately $310,000 in

Glendale, Wisconsin, on October 8, 1984.

2) The theft from the vehicle of a salesperson for

Rolex Watch USA, Inc., of watches having a value of

approximately $500,000 on or about October 13,

1986, in Monterey, California.

3) The theft from the vehicle of a salesperson for

Gordon Brothers Corporation of jewelry having a

value of approximately $125,000 in Englewood, Ohio,

on or about August 28, 1989.

4) The theft of a bag of a salesperson for J. Schliff

and Sons, Inc., doing business as Gem Platinum

Manufacturing, containing jewelry having a value of

approximately $1,000,000 on or about June 30, 1992,

at Dallas/Ft. Worth, Texas.

5) The theft from the rental vehicle of a salesperson

for J. Schliff and Sons, Inc., doing business as

Gem Platinum Manufacturing, of jewelry having a

value of in excess of $1,000,000 in Flat Rock,

Michigan, on June 23, 1993.

6) The theft from the rental vehicle of a salesperson

for H.K. Ma11ak, Inc., of jewelry having a value of

approximately $240,000 on August 3, 1993, in

Mankato, Minnesota.

7) The theft from representatives for Nafco Gems, Ltd.

and Mayfield's Company of jewelry having a value in

excess of $170,000 at the Skyharbor Airport,

Phoenix, Arizona, on May 7, 1994.

e) The theft from safety deposit boxes at the Hyatt

Regency .Hotel, Columbus, Ohio, of jewelry,

gemstones, U.S. currency, and other material of an

aggregate value in excess of $1,500,000 on August

27, 1994. The victims of such theft included the

various entities listed in Paragraph 1(e) of this

Count.

(b) It was further a part of the conspiracy that one or more of the conspirators would and did attempt to steal and remove jewelry from persons involved in the jewelry trade, including the following:

1) The theft from a hotel room at the Los Angeles

Airport Hilton of the suitcase of a salesperson for

Solar Diamonds, Inc. on or about June 17, 1994, in

Los Angeles, California.

2) The theft from the vehicle of a salesperson for

Baume & Mercier, Inc., of two jewelry cases on

October 2, 1996, one of which contained numerous

fine watches, in Chesterton, Indiana, as more fully

described in Count Two.

(c) It was further part of the conspiracy that one or more of the conspirators would and did physically surveill the residences, places of work, and/or the persons of individuals the

conspirators believed to be involved in the jewelry trade, including the following:

1) A Nafco Gems, Ltd. representative, his residence,

his car and/or place of business in Arizona on

various occasions, including in 1995 and 1996.

2) A jewelry appraiser, his car and/or residence in

Arizona on various occasions including in February

and March 1996.

3) A Mayfield's Company representative, her car,

residence and/or place of business in Arizona and

elsewhere including in 1996.

4) A Baume & Mercier salesperson, his car and/or

residence in Illinois, Wisconsin, and Indiana on

several occasions, including between April 1996 and

October 1996, as more fully described in Count Two.

S) A Kobi Katz, Inc./Lieber Solow, Ltd.

salesperson's residence in Illinois in August 1996.

(d) It was a part of the conspiracy that, to generate income, certain of the conspirators attempted to identify traveling jewelry salespersons and to obtain personal information on each such salesperson for the purpose of determining the most opportune time and occasion to steal from a car, hotel room, or other location, jewelry being transported by the salesperson.

(e) It was further part of the conspiracy that one or more of the conspirators would arid did contact hotels and determine if a traveling jewelry salesperson was staying or was scheduled to stay at the hotel, including defendant HANHARDT contacting three hotels in Illinois on August 23, 1996, to determine if a certain Elan Ltd. salesperson had an advanced reservation, and defendant

DESTEFANO contacting numerous hotels in Minnesota on August 2-3, 1993, to determine the location of a certain H.K. Mallak, Inc., salesperson.

(f) It was further part of the conspiracy that one or more of the conspirators received information from defendant ALTOBELLO concerning, among other things, the identity of certain traveling jewelry salespersons, the nature and quality of their jewelry and/or a portion of the travel schedule of the traveling jewelry salespersons, including in 1996 a Mikan, Inc. salesperson and an ESY, Inc. salesperson.

(g) It was further a part of the conspiracy that, to facilitate the activities of the enterprise, certain of the coconspirators obtained, maintained and used communications equipment such as walkie talkies, pagers, skypagers and cellular telephones.

(h) It was further a part of the conspiracy that, to perpetuate the enterprise, certain of the conspirators used and agreed to use money obtained from the pattern of racketeering activity in the operation of the enterprise.

(i) It was further a part of the conspiracy one or more of the conspirators, including defendants AANHARDT, HASINSKI, and SCHIRO, would and did physically surveill jewelry stores as part of a plan and scheme to identify persons that would carry jewelry to and from such jewelry stores, including the following:

1) Dennis D. Naughton Jewelers, doing business as

Naughton Jewelers, and Molina, Inc., doing business

as Molina Fine Jewelers, in Phoenix, Arizona, on

numerous occasions during the years 1995 and 1996.

2) Golden Rule Jewelers, Inc. doing business as

Jewelry by Albert, in Scottsdale, Arizona, on

February 12, 1996.

3) Gaston Jewelers Inc. in Glendale, Arizona, on

various occasions in February and March 1996.

4) Smith Fine Jewelers, Inc., in Scottsdale, Arizona,

on February 12, 1996 and March 1, 1996.

(j) It was further a part of the conspiracy that the

conspirators would and did attend jewelry shows designed for

jewelry wholesalers and retailers, some not open to the public, to

identify persons involved in the jewelry trade, and to evaluate the

quality and quantity of the jewelry line of such jewelry

wholesalers and retailers, including the following:

1) The American Gem Trade Association annual

convention, held in 1996 in Tucson, Arizona.

2) The Tucson Gem and Mineral Society trade show, held

in 1996 in Tucson, Arizona.

3) The annual Jewelers Circular Keystone

International Jewelry Show, held in 1996 in Las

Vegas, Nevada.

(k) It was further a part of the conspiracy that certain of the conspirators would and did rent vehicles for the purpose of physically surveilling jewelry salespersons and jewelry stores.

(1) It was further a part of the conspiracy that certain of the conspirators obtained, maintained and used various tools and instrumentalities in order to assist in gaining access to vehicles,

vehicle trunks, vehicle ignitions, hotel rooms, safety deposit boxes and other locations, to avoid detection or to escape law enforcement, including locksmith tools, keymaking machines, related publications, automobile instruction books, automobile keys, hotel keys, key blanks, lock picks, "slim jims," smoke grenades, fake mustache and fake beard, key cutting dies, wrenches and other hand tools, evasion devices, taser, cam set, key cutters, bullet proof vests, cameras, listening devices, and key code books.

(m) It was further part of the conspiracy that certain of the conspirators would and did obtain luggage to be used to

switch with the luggage of jewelry salespersons.

(n) It was further a part of the conspiracy that certain of the conspirators would and did obtain and create keys that provided access to vehicles being driven by jewelry salespersons, to hotel rooms, to safe deposit boxes and to other locations.

(o) It was further a part of the conspiracy that certain of the conspirators would and did request CPD officers, known and unknown, t4 cause searches to be made from CPD terminals that connected electronically to computer databases located both inside and outside of the State of Illinois, thereby gaining information on jewelry salespersons and cars driven by them in order to determine the most opportune moment to steal jewelry being transported by the salespersons, including the following computer database searches:

_ 1) The Arizona license plate on the personal car of

the Nafco Gems, Ltd. representative, utilizing the

National Law Enforcement Telecommunications Systems

Inc. ("NLETS") on January 20, 1996.

2) The Arizona license plate on the personal car of

the jewelry appraiser, utilizing NLETS, on February

7, 1996.

3) The Illinois license plate on a rental car, leased

by a Mikan, Inc. salesperson, on February 13, 1996.

4) The Illinois license plate on a rental car, leased

by a Yahalom, Inc. representative, on March 25,

1996.

5) The Illinois license plate on the personal car of

the Kobi Katz, Inc./Lieber & Solow, Ltd.

salesperson on July 30, 1996.

6) The Illinois license plate on a rental car, leased

by an ESY, Inc. salesperson, on August 29, 1996.

(p) It was further a part of the conspiracy that certain of the conspirators would and did request CPD officers to attempt to obtain car rental contract information on jewelry salespersons, including the rental car contract of a Yahalom, Inc. representative in March 1996, and the rental contract of an ESY, Inc. salesperson in August 1996.

(q) It was further a part of the conspiracy that certain of the conspirators would and did cause a private investigator to conduct database searches to be made of commercial electronic databases through commercial entities such as Trans Union Corporation, Equifax Credit information services, Inc., Database Technologies, Inc., and .CSC Credit Services, Inc., and other

commercial. database services, often utilizing the interstate wire communication system, thereby gaining from the databases credit reports and other personal and financial information on jewelry salespersons and others. These databases inquiries included interstate wire transmissions relative to the following jewelry salespersons and manufacturer representatives:

1) For a Mikan, Inc. salesperson, his wife, and Mikan,

Inc.:

a) Database Technologies, Inc. ("DHT") database

in Florida on February 27, 1996.

b) Equifax's database in Atlanta, Georgia on

February 27, 1996.

c) Trans Union's database in Chicago on February

27, 1996.

d) DST's database in Florida on March 1, 1996.

e) Trans Union's database in Chicago, Illinois on

March 4, 1996.

f) Equifax's database in Atlanta, Georgia,

through a CSC account, on March 8, 1996.

2) For a jewelry salesperson for DeBella Fine Gems and

Jewelry Arts:

a) Trans Union's database in Chicago, Illinois, on or about July 25, 1992.

b) Equifax's database in Atlanta, Georgia, on or about July 25, 1992.

3) For a former jewelry salesperson for Oscar Heyman &

Brothers, Inc.:

a) Trans Union's database in Chicago, Illinois, on or about August 7, 1992.

b) Equifax's database in Atlanta, Georgia, an or about August 8, 1992.

4) For a representative for Horizon Imports:

a) Trans Union's database in Chicago, Illinois, on or about April 12, 1994,

b) Equifax's database in Atlanta, Georgia, on or about April 12, 1994, relative to.

5) For a former jewelry salesperson for Advanced Ring

Manufacturing, Inc., and his wife to Trans Union's

database in Chicago, Illinois, on or about August

7, 1992.

6) For a jewelry salesperson for Phillip Wolman & Co.

to Trans Union's database in Chicago, Illinois, on

or about August 26, 1992.

7) For a jewelry salesperson for Kobi Katz, Inc. to

the databases of Trans Union, Equifax, and TRW

through Engineered Business Systems, Inc., on or

about June 30, 1993.

(r) It was further a part of the conspiracy that certain of the conspirators would and did use walkie talkies to communicate for the purpose of conducting physical surveillances of jewelry stores and jewelry salespersons.

(s) It was further a part of the conspiracy that certain of the conspirators would and did use telephone calling cards and pay telephones to communicate the status of the conspiracy's activities and to discuss and direct future activity of the conspiracy and its members.

(t) It was further part of the conspiracy that certain of the conspirators obtained, created and maintained, various documents concerning numerous individuals involved in the jewelry

trade, all for the purpose of attempting to determine the most opportune time and location to steal jewelry from one or more of the individuals, along with attempting to limit the risk of being discovered by law enforcement. These documents included, among other documents, one or more of the following on one or more individuals:

1) Specific, detailed and accurate personal

descriptive information on such individuals, their

family members and their residences.

2) Specific, detailed and accurate information related

to the businesses of such individuals.

3) Specific, detailed and accurate information on

vehicles owned or utilized by such individuals,

including key codes.

4) Travel itineraries and analyses including such

information as airlines used, travel information,

ticket numbers, travel dates, cities, hotels used,

travel agencies and rental car companies utilized,

number of miles driven, airline baggage claims

tickets and hotel bills.

5) Specific, detailed and accurate information

concerning various credit card, bank and other

accounts of such individuals and, at times, credit

bureau reports on certain such individuals.

(u) It was further part of the conspiracy that certain of the conspirators would and did deliver jewelry stolen from traveling salespersons to individuals for purchase.

(v) It was further part of the conspiracy that certain of the conspirators would and did cause money generated from the sale of stolen jewelry to be provided to certain of the conspirators.

(w) It was further part of the conspiracy that certain of the conspirators misrepresented, concealed and hid, caused to be misrepresented, concealed and hidden, and attempted to misrepresent, conceal and hide the illegal operation of the enterprise and acts done in furtherance of the enterprise, including the following means:

(1) avoiding and limiting discussion of the enterprise's illegal activities over personal telephone lines;

(2) using aliases, including the name "Richard Stevens", when renting hotel rooms and paying in cash to avoid leaving a trail of their activities;

(3) using coded or ciphered language to discuss amongst themselves the attempts to identify jewelry salespersons and other acts to further their conspiracy;

(4) removing front license plates from their vehicles while conducting physical surveillances of jewelry salespersons and jewelry stores; .

(5) using a telephone calling card in a fictitious name to Communicate;

(6) altering their appearance, by changing clothes and otherwise, while surveilling jewelry salespersons or locations;

(7) using alias identities and possessing identification cards and other documents in alias names; and

COUNT TWO

The SPECIAL JANUARY 1999-1 GRAND JURY further charges:

2. At all times material to this indictment:

(a) Baume & Mercier, Inc. (hereinafter "Baume & Mercier") was a corporation organized and existing under the laws of the country of Switzerland. Its subsidiary was Baume & Mercier, a Division of VLG North America, Inc., located at 663 Fifth Avenue, New York, New York. Baume & Mercier was engaged in the wholesale fine watch business. An individual (hereinafter "Baume & Mercier salesperson") was a traveling salesperson for the company and lived in Park Ridge, Illinois.

2. Beginning prior to April 1996, and continuing until at least October 1996, in the Northern District of Illinois, Eastern Division and elsewhere,

WILLIAM A. HANHARDT,

JOSEPH N. BASINSKI, PAUL J. SCHIRO, and WILLIAM R. BROWN,

defendants herein, did conspire with each other and with others, known and unknown to the grand jury, to commit an offense against the United States, namely: to transport, transmit, and transfer in interstate commerce goods and merchandise of the value of $5,000 or more, namely: fine watches, the property of Baume & Mercier, knowing the same to have been stolen, converted and taken by fraud, in violation of Title 18, United States Code, Section 2314.

3. It was part of the conspiracy that the conspirators agreed with each other to steal fine watches being carried by the Baume & Mercier salesperson and to transport, deliver and sell the stolen watches in interstate commerce.

4. It was part of the conspiracy that certain of the conspirators, separately or together, traveled to Wisconsin and Indiana on occasion specifically to identify potential opportunities to steal the fine watches from the Baume & Mercier salesperson.

5. It was further part of the conspiracy that certain of the conspirators used duplicate vehicle keys and walkie-talkie radios while carrying out the planned theft of fine watches from the Baume & Mercier salesperson.

6. It was further part of the conspiracy that codefendant BASINSKI and defendant HANHARDT communicated by telephone and Skypager.

7. It was further part of the conspiracy that one or more of the conspirators would and did rent vehicles for the purpose of surveilling the Baume & Mercier salesperson in Illinois, Wisconsin, and Indiana.

8. It was further part of the conspiracy that one or more of the conspirators, would and did conduct surveillances of the Baume & Mercier salesperson at his house and in his car.

9. it was further part of the conspiracy that one or more of the conspirators would and did obtain and create keys that would provide access to the vehicle driven by the Baume & Mercier salesperson.

10. it was further part of the conspiracy that on October 2, 1996, near the Spa Restaurant in Chesterton, Indiana, the defendants entered the trunk of the vehicle of the Baume & Mercier salesperson and did remove from the vehicle two cases, one of which contained fifteen fine watches of an approximate value of $55,000.

11. It was further part of the conspiracy that the conspirators would and did misrepresent, conceal, and hide, and cause to be misrepresented, concealed and hidden the purposes of and the acts done in furtherance of the conspiracy, and would and did use other means to avoid detection and apprehension by law enforcement authorities and otherwise to provide security for the members of the conspiracy.

OVERT ACTS

12. In furtherance of the conspiracy to effect the objects thereof, the defendants committed or caused to be committed, the following overt acts, among others:

(a) On April 25, 1996, defendant HANHARDT and defendant BASINSKI had a telephone conversation.

(b) On July 25, 1996, defendant BASINSKI surveilled the residence of the Baume & Mercier salesperson.

_ surveilled the residence of the Baume & Mercier

salesperson.

(d) On August 16, 1996, defendant BASINSKI caused a telephone call to be made to a location in Michigan which could provide the key code for making a key for certain Lincoln automobiles manufactured by the Ford Motor Company.

(e) On September 6, 1996, defendants HANHARDT and BASINSKI followed the Baume & Mercier salesperson in Illinois while the salesperson was driving his Lincoln.

(f) On September 12, 1996, defendants HANHARDT and BASINSKI followed the Baume & Mercier salesperson as he drove his Lincoln from Illinois to Wisconsin.

(g) On September 24, 1996, defendant HANHARDT followed the Baume & Mercier salesperson as he drove his Lincoln to the post office.

(h) On September 30, 1996, defendant BASINSKI caused a telephone call to be made to a location in Michigan which could provide the key code for making a key for certain Lincoln automobiles manufactured by the Ford Motor Company.

(i) On October 1, 1996, defendants HANHARDT, SASINSKI, SCHIRO and BROWN, followed the Baume & Mercier salesperson as he drove his Lincoln from Illinois to Wisconsin.

(j) On October 2, 1996, defendants HANHARDT, HASINSKI, SCHIRO and BROWN, followed the Baume & Mercier salesperson from Illinois into Indiana.

(k) On October 2, 1996, in Chesterton, Indiana, while the Baume & Mercier salesperson was in a restaurant, with defendants HANHARDT, SCHIRO and BROWN serving as lookouts, defendant BASINSKI, using a key, entered the trunk of the salesperson's Lincoln and removed two jewelry cases, one of which contained fifteen fine watches of an approximate value of $58,000, and placed the cases in the trunk of a rental car.

(l) On October 2, 1996, in Chesterton, Indiana,

defendant BASINL$KI drove the rental car a short

distance from the restaurant, opened the rental

car's trunk, lifted the two jewelry cases, replaced

the cases back in the rental car's trunk and closed

the trunk, and returned to the parking lot of the

restaurant.

(m) On October 2, 1996, in Chesterton, Indiana, with HANHARDT, SCHIRO and BROWN serving as lookouts, defendant BASINSKI returned to the Baume & Mercier salesperson's Lincoln that was parked in the restaurant parking lot, reopened the Lincoln's trunk and returned the two jewelry cases.

All in violation of Title 18, United States Code, Section 371.

FORFEITTIRE ALLEGATION

The SPECIAL JANUARY 1999-1 GRAND JURY further charges:

1. The allegations contained in Count One of the indictment are realigned and incorporated by reference for the purposes of alleging forfeiture pursuant to Title 18, United States Code, section 1963.

2. As a result of the violation of Title 18, United States Code, Section 1962(d), as alleged in the foregoing indictment

WILLIAM A. HANHARDT,

JOSEPH N. HASINSKI,

PAUL J. SCHIRO,

SAM DESTEFANO, and GUY ALTOHELLO,

defendants herein:

(a) have, acquired and maintained interests in violation of Title 18, United States Code, Section 1962, which interests are subject to forfeiture to the United States pursuant to Title 18, United States. Code, Section 1963(a)(1);

(b) have interests in, securities of, claims against, and property and contractual rights affording sources of influence over the enterprise described in Count One which defendants established, operated, controlled, conducted, and participated in the conduct of, and conspired to do so, in violation of Title 18, United States Code, Section 1962, thereby making all such interests, securities, claims, and property and contractual rights subject to forfeiture

to the United States of America pursuant to Title 18, United States Code, Section 1963(a)(2);

(c) have property constituting and derived from proceeds which obtained, directly and indirectly, from racketeering activity in violation of Title 18, United States Code, Section 1963 (a)(3).

3, The interests of the defendants, jointly and severally subject to forfeiture to the United States pursuant to Title 18, United States Code, Section 1963 (a) (1), (a) (2), and (a) (3) include but are not limited to:

(a) $4,845,000

(b) Miscellaneous jewelry, gems and watches

Real property at 835 Heather Road, Deerfield, Illinois, being more particularly described as:

Lot 1 in Hamilton's Subdivision, being a

subdivision of part of the south 355.30 feet

(except the west 494.55 feet thereof) of the west 'h

of the southeast 1/4 of the southeast 1/4 of

Section 28, Township 43 North, Range 12, East of

the Third Principal Meridian, according to the Plat

thereof recorded May 20; 1976 as document 1767938,

in Book 54 of Plats, Page 48, in Lake County,

Illinois.

(d) As to defendant SAM DESTEFANO only:

Real property at 2216 Durand Drive, Downers Grove, Illinois, being more particularly described as:

That part of Lot 12, of the Villas of Bending Oaks, being a subdivision of part of Sections 12 and 13, Township 3B North, Range 10, East of the Third Principal Meridian, lying Ely of a line described as being 58.68 feet W, as measured along the Sly line thereof, from the E line of said Lot 12, and

67.87 feet W, as measured along the Nly line

thereof, from the E line of said Lot 12, all in

Dupage County, Illinois.

a. To the extent that the proceeds and property described

above as being subject to forfeiture pursuant to Title 18, United

States Code, Section 1963, as a result of any acts or omission by

any defendant:

(1) cannot be located upon the exercise of due diligence;

(2) has been transferred or sold to, or deposited with, a third party;

(2) has been placed beyond the jurisdiction of the Court;

(3) has been substantially diminished in value, or;

(4) has been commingled with. other property which cannot be subdivided without difficult;

it is the intent of the United States of America, pursuant to Title 1B, United States Code, Section 1963 (m) to seek forfeiture of any other property of the defendants up to the value of the proceeds and property described above as being subject to forfeiture;

All pursuant to Title 18, United States Code, Section 1963. A TRUE BILL:

F O R P E R S O N

UNITED STATES ATTORNEY