Born to Steal: When the Mafia Hit Wall Street Read online

  But the glory days were ending for Chop House Wall Street, as its leading figures were arrested, one by one. In September 1998, a federal grand jury in Brooklyn indicted Jordan Belfort and the other bosses of Stratton Oakmont, the Long Island counterpart of Hanover Sterling. Three months later, another bombshell, also from the Brooklyn feds. On December 17, 1998, the target was a slew of brokers who used to work at Hanover Sterling. By the time the arrests were completed, fifty-five brokers and their Guys were thrown in jail—including Roy Ageloff and Bobby Catoggio. Louis’s old pal Randy Ashenfarb was arrested, and so were Rocco Basile and his former boss John Lembo. There were some omissions. Rico Locascio was arrested, but his partner Black Dom was not. Chris Wolf was not named in this indictment. A broker named Brent Longo was arrested, but not his stepfather Alan Longo, the Genovese skipper and Fulton Fish Market Guy whom Business Week had identified as a Genovese family connection to Hanover.

  Louis was sad and pissed when he read about the arrests. Roy was God, the reason why he and the rest of the chop house kids were making money. Roy had created the pitching style, and his management techniques were emulated everywhere there was a rip. Rocco was another role model, a salesman to copy and cherish. All the guys at Hanover taught him everything he knew about selling stocks, and managing kids, and spending the money that came from it all. And they were starting to go to jail.

  When the FBI came up to First Fidelity, Louis was calm. Everyone else was panicking. Not Louis. He realized there wasn’t a damn thing he or anybody else could do about it. More shit luck. Shortly before Christmas 1998, New York police raided the 5 Hanover Square office of First Fidelity. Somebody had smelled the odor of burning crack. The FBI took over the case and eventually followed a paper (or powder) trail to the office at 110 Wall.

  When the FBI agents came to 110 Wall, Louis was at his Play Station, enjoying a video game with Eddie Talmeni. Two of the four agents entered his office and politely interrupted the game.

  “Hi, how are you doing? FBI.”

  “How you doing, guys?”

  “What are you doing here?”

  “I just use this office.”

  “Who you work for?”

  “Myself.”

  “What do you do?”

  “Consulting.”

  “What kind of consulting?”

  Louis had to think a moment before answering, “Securities consulting.”

  “Interesting. What’s your name?”

  “Robert Gro.”

  “Have you got ID?”

  “No, left my wallet at home.”

  The FBI guy made Louis print his name and sign it. He wasn’t sure how to spell his name, as he had just made it up. G-R-O-W?

  “I didn’t know how to spell it. I think I spelled it G-R-O,” said Louis. “Eddie put down some Spanish name. Nobody had ID. Nothing they could do. I cleared out that afternoon.”

  Louis had to figure out some way to get cash. He looked to his family. He had helped them when times were great. Now times were not so great.

  STEFANIE: “One time I was changing the baby and I remember taking off my ring. And my ring—my engagement ring—disappeared. Louis says, ‘You probably flung it somewhere,’ but I didn’t fling it. I ripped the whole house apart. I went through dirty diapers. Every single diaper, because I thought maybe it fell into the diapers, and I had a pail of dirty diapers. I remember going to meet my mother for lunch one day with the baby, and my mother noticed that it wasn’t on. My father said something to my mother, ‘Why isn’t she wearing her engagement ring?’ and I said I can’t find it. So he says, ‘If you want, I’ll come down and help you.’ But I think they knew what was going on.

  “Louis swore up and down he didn’t take it, he didn’t take it. It took a long time for him to say it. I knew he took it, whether he wanted to admit it or not. There was no way I lost the ring. I put it down to change the diaper because I had to put cream on my hands, to put cream on the baby or whatever. There was no way. I didn’t lose it. I didn’t miss it till the next day. It was a year before he fessed up. I never got it back. He hocked it. I got past it without him admitting it, but my biggest thing was, ‘If you needed it, you could have told me. And if that’s the case, at least you could have given some money to the house.’ That was my biggest thing. ‘If you had asked me, I would have given it to you. It’s only a ring. You don’t have to steal.’”

  NICK PASCIUTO: “I shouldn’t have helped him after the first ten grand I gave him. But you’re a father, you have a son, you believe in him and you trust him. Meanwhile, he had a wife. I mean, I love her. She’s the mother of my grandson. She’s my daughter-in-law. Partly because of her I had my grandson. I love him as any grandfather would love a grandson. There was a lot of shit and it wasn’t her fault. He cheated on her, he gambled. It was wrong in my eyes. It wasn’t right what he was doing. Let’s put it that way. It hurt me. It’s not good.

  “My son’s never going to lie to me. My son’s never going to hurt me in any way. This is his word. His promise to go by. At the time I was wrong. He became a mad, degenerate gambler. With the money he made, he’d be well off, way well off. He got a good piece of the action. But he’d get $20,000 and he’d bet on the Mets to win. Who does that in their right mind?

  “He’d get in a jam, and we’d help him. That’s what I felt. You think you’re doing the right thing and taking care. ‘If I don’t get this ten thousand dollars on Tuesday, I’m getting killed on Thursday.’ What are you going to do? I’ll get the ten thousand for you, Lou. Is it over now, Louis? Is it the end of this? He’d say, ‘After I get this cleared up,’ but he’s still gambling. How’s he going to get it cleared up?

  “He took us for a beating. Not that he, at the time, robbed us. I was giving it to him. Taking care of it. The credit cards that we had, I don’t know what the credit rating was, but we had AAA credit. And it just went down the tubes, because it was all overextended. We couldn’t pay anymore.

  “When he moved to Battery Park City, I signed the lease because my credit was impeccable. I had an American Express Platinum Card. I was making fifty thousand a year. It wasn’t based on my income. It was based on my twenty-five years, my credit history. If you applied for it, you needed to make a lot more than that. So I signed things, and that was that. He wasn’t paying. My name. Kill it. And they did. They killed it. Bigtime.

  “When I claimed bankruptcy I think I had five hundred thousand dollars in debts. Three hundred thousand was because of him. With the boat and Mercedes. The Mercedes, I signed for that, they repossessed that, and I’m battling with my lawyer. I want to make sure there’s no lien on my house. They took the car back, but they’re still suing me for eighty thousand. I don’t understand that part. You got the car. They’re saying it’s because the car was worth X amount, one hundred thousand dollars. They sold it for, whatever, forty thousand. And you owe sixty thousand plus penalties and interest and all the bullshit lawyer fees, garbage. They piled everything on. They got the car. They repossessed it. You didn’t sell it for what you want, you shouldn’t have sold it. That’s the way I look at it.

  “You have no idea. It’s, like, insane. It’s my fault too because I kept on doing it, like a jerk, I kept on doing it, doing it, doing it. But still, you got to smarten up. You figure, like, the word of your son. The promise of your son. If you can’t believe that, what can you believe?”

  GEORGE DONOHUE: “After I bailed him out for the check arrest, I just washed my hands of the whole situation. Him and I were finished. That’s it. It’s like a disease. Like a drug addict. You can’t believe anything they say. You got to hide everything. Because you’re just so afraid that they’re going to do anything. Forget it. You can’t leave the keys to the car. It’s a terrible feeling. Not being able to trust somebody at all. I just turned my back. That’s it, buddy.

  “I knew Louis’s personality, so I knew he was scared to death. No matter how you look at it, he was a Staten Island kid who went to a Catholic school. He
might have been a little punk guy in his own way, but he wasn’t a hard-core. He was in the big times—and he was lost.”

  CHAPTER FORTY-SIX

  Every number on a pager can mean something, if you want to be creative. Lovers sometimes signal each other with 214—February 14. Valentine’s Day.

  Charlie would begin by entering his phone number on Louis’s pager. By the late fall of 1998, Louis was not responding to that. So after paging with his number and getting no response, Charlie would enter his number and then 123123. That meant “hurry up.”

  By early 1999, 123123 wasn’t working, so Charlie would tap in 123911. Hurry up. Now. Emergency.

  When that stopped working, Charlie started using 911911911911. Then 666911. Die. 666. The devil.

  “By the time I called him back, I knew he would be foaming out of his mouth. I’d call, the phone wouldn’t ring even once. It would go, ‘ring—’ He’d pick up and go, ‘You cocksuckerrrrrr!’ I’d go, ‘What the hell’s the matter with you? I had to get to a pay phone.’ Meanwhile I’d be like smiling and laughing.

  “‘You fucking laughing at me! I paged you forty fucking times!’

  “‘All you have to do is beep me once. It comes into my beeper. As soon as I get to a pay phone, I’ll call you back.’

  “‘All the money you fucking rob, you can’t buy a cell phone, you cocksuckerrrr!’”

  Louis had a cell phone, but wouldn’t give him the number.

  It was a ritual now. The beeper. The screaming. The passive-aggressive defiance. It wouldn’t take a legion of psychologists to conclude that maybe Charlie wasn’t being very effective, that he wasn’t getting anywhere, that his harassment was feeding into a kind of deeply rooted rebellious streak in Louis, developed in childhood and honed in parochial school.

  But Charlie had one advantage over the priests at Sea. He had Louis convinced that he could never quit.

  So the rituals became a mutually chanted mantra as their relationship disintegrated, following Louis’s departure from First Fidelity and its promise of a steady income. Charlie would scream and Louis would bait. Charlie would threaten and Louis would reason. Charlie would page and Louis would not respond. It was more than just defiance—it was good sense. The less he had to do with Charlie, the less money he had to pay.

  Louis didn’t read the papers anymore. His friends and mentors were getting indicted while legit guys his age were getting rich by day-trading and starting up dot.coms. He wanted to go over to these nerds, bending over their fucking computers, and bash their heads in. Here he was, caught in a time warp with a brown-tanned ex-con tapping psycho messages into his pager.

  As the countdown to the millennium reached 365 days, Louis was back with Ralph Torrelli, briefly. Louis had a new crew of cold-callers, mainly kids who’d been with him from TYM. They were friends, or friends of friends. Good salesmen. But they might just as well have been selling condoms to convents if they couldn’t lie. You had to lie if you were going to sell an oil company, Anglo Gulf Oil, when oil was passÉ and dot.coms were hot. This was 1999, not 1979.

  It was no use. Ralph was adamant. “I wanted to do it like ‘anglogulf.com.’ I said, ‘Let’s make it a real estate investment trust for oil wells.’ It was a good idea. I said I could raise money on that. But he didn’t want me to do it that way. He wanted me to do it legit. So I said, ‘I can’t do it, Ralph,’” Louis said.

  Louis and Ralph parted ways. It was sad. What made it even sadder was that Charlie wanted Louis to work for him. Charlie said he had control of the New York branch office of a firm called Aaron Capital, through his pal “Stevie Two Guns” Mignano. “He says, ‘Stevie works for me. I got control over this firm,’” said Louis. “He said this to me on the phone. Charlie would talk on the phone. I would say I didn’t want to talk on the phone, and he would get annoyed. I guess he figured no one was listening.”

  Aaron was a fiasco from the start. Charlie arranged a meeting at Zio’s in Bay Ridge. The guy who was supposed to be running the office, a Russian kid named Mike, obviously owed Stevie a lot of money. It was obvious because as Louis walked into the restaurant, Stevie and Charlie were roughing up Mike. The meeting went downhill from there—downhill into the sewer. Louis was supposed to be in charge, but Charlie wouldn’t let Mike give him any information that he needed to run scams. “I wanted to know if he could run trades without money in the account. And right away when I said ‘money in the account,’ Charlie said, ‘What money in the account? Who has money in the account? You have money in the account at the firm?’”

  Even before Louis settled into his new shithole of an office at 30th Street and Madison Avenue, he realized he had to get out. He started up his own firm. It would be another First Fidelity, only better, because Louis was going to run it.

  A good structure was essential. The firm would have to have a bank account, it would have to make believe it was a brokerage, and it would have to not be registered with any governmental or regulatory entity in the world. Louis had learned at First Fidelity about the power of a good name, so a properly conceived company was another must. United Capital Consulting Corporation had a good ring to it, and it sounded vaguely familiar, which was good. A legit firm with that name used to exist. The bank account would be at Dime Savings Bank. Louis didn’t trust banks, but he needed a bank account so customers had a place to wire money.

  Louis started working on United Capital during his few weeks at Charlie’s branch office—yet another common feature of the entrepreneurs Louis was hearing about. They worked for themselves. Louis needed his own firm, and he didn’t want Charlie to have anything to do with it. Charlie would have to fend for himself from now on.

  While he was still at Aaron, Louis started putting his clients—clients who were supposed to be buying Aaron’s house stock, Matco—into United Capital’s “stocks.”

  Louis didn’t tell anybody. But Charlie found out. Instantaneously. For others, it took a lot longer. Such as, for example, a man by the name of Dennis Gordon who lived out in Texas and was president of Aaron Capital.

  Years later, Gordon didn’t remember anyone named Charlie or Stevie or Louis. But he remembered meeting some guys, tough-looking guys. They wanted to open an office of his firm. He said no. That was, he thought, the end of it.

  According to Gordon, there was a break-in at Aaron’s New York office not long after that. Someone stole business cards. Account information. And then—complaints. Stock was sold that was never delivered. Stock in the Goldman Sachs IPO, with money to be sent to an account at Dime Savings Bank.

  “They stole the business cards from our brokers and the customer account information, and took it to their office downstairs, calling our clients, representing themselves as a broker of our firm,” said Gordon. “The clients already had a trust in the broker, so when this fake broker told the customer to wire money to Dime Savings, on behalf of some other company, some consulting firm, they did. So we called the FBI, SEC, NASD, and washed our hands of it.” *

  By mid-1999, Stefanie and Charlie had remarkably similar complaints. They both thought that Louis was uncommunicative, dishonest, and disloyal. They suspected betrayal. In Charlie’s case, the suspicion was confirmed. The Luciano fence-jumping incident still burned him.

  For Charlie, divorce was never an option. He was going to make their marriage work. But Stefanie had had enough.

  After hearing from a friend that Louis was seen cheating on her, and then seeing his car parked for what appeared to be a tryst, Stefanie walked out on him. His denials meant nothing. His credibility was not too great at this point. One day, while Louis was at work, Stefanie and her family hauled away everything, even the furniture. Louis came home that night to find the apartment empty except for a mattress on the floor.

  Now his personal life was as fucked up as his life on the Street.

  In June 1999, as Louis finished drafting the United Capital private placement documents, the feds launched another assault on Louis’s friends and their Guys. This
time he was really shaken up. His old pal and mentor, the strung-out Hanover-Greenway superbroker Chris Wolf, was indicted by a federal grand jury in Brooklyn on multiple counts of securities fraud and money laundering. Named in the indictment were Chris Wolf’s two Guy patron-tormenters—Black Dom Dionisio and Enrico Locascio. So were twenty others, nailed by the same tenacious Brooklyn prosecutors who had gone after Roy and Bobby and, previously, Jordan Belfort of Stratton Oakmont. One of the chop houses named in the indictment was Amerivet, Ralph Torrelli’s firm before TYM. Torrelli was not indicted.

  At about the same time as the Wolf-Dionisio bust, Phil Abramo and a bunch of his confederates were taken down in a twenty-one-count Florida indictment. Later Phil was hit by another indictment nailing the entire DeCavalcante family hierarchy. It was perfectly timed—a TV series about New Jersey Guys, The Sopranos, had become wildly popular. The feds were competing over which Guy or chop house scalp they could produce on a platter. Since the chop houses had offices and trade-processing facilities around the country, jurisdiction was nebulous. It was chaotic stuff—if this was the Mob, there definitely would have been sitdowns.

  By mid-1999, the Eastern District of New York, under soft-spoken but aggressive U.S. Attorney Zachary W. Carter, had racked up the most indictments. But Wall Street was in the Southern District of New York. So far, U.S. Attorney Mary Jo White had been little heard from. Was the short, cropped-haired White a lame “nothing happens here” wimp like her predecessor Otto Obermaier? Or would she aim for the jugular, the headlines—and, maybe, higher office—as did her other predecessor, Rudy Giuliani? Through most of 1999, that just wasn’t clear. There were rumors of major investigations and imminent indictments from the Southern District. Louis heard the rumors. But that’s all they were.

  What was obvious was that the feds were getting nearer and nearer to Louis and the people around him. But if that dawned on Charlie, it seemed to make him even more violent, even more unreasonable. Louis didn’t know what pressure Charlie was getting from the Guys above him, but it must have been every bit as brutal as the pressure Louis was getting from Charlie.