Born to Steal: When the Mafia Hit Wall Street Page 32

  Louis had never heard of most of them. White’s prosecutors had thrown together, in a single press release and press conference, a grab bag of twenty-two largely unrelated cases. Thirteen of the cases had something to do with a Manhattan stock-promotion firm called DMN Capital, run by a Bonanno skipper named Robert Lino. Nine—including the three in which Louis was a cooperating witness—had no connection at all to DMN.

  DMN was a fairly typical Guy-run stock promotion firm, and it was similar to, if more sizable than, Ralph Torrelli’s Effson Associates. White made it out to be a cross between Merrill Lynch and the Hole-in-the-Wall Gang. It was terrific publicity.

  This was war—a war for media attention—and the Eastern District had lost. Compared to the Brooklyn feds’ Hanover Sterling and Stratton Oakmont indictments, the Manhattan feds’ June 2000 cases were small potatoes. Eastern District U.S. Attorney Zachary Carter, and his successor Loretta E. Lynch, were both fine prosecutors. But they had a lot to learn about the art of the press conference.

  Louis had been waiting anxiously for Charlie’s arrest, and he was relieved that he was behind bars. Charlie was charged with two counts of loan sharking. Unlike most of the other defendants, Charlie was detained without bail on the grounds that “there is a serious risk that the defendant will endanger the safety of another person or the community.” They didn’t say who the “other person” was. But Louis’s identity was soon made known to defense counsel.

  Charlie was arraigned and pleaded not guilty. His case was soon moved to the Brooklyn courthouse, and lawyers swiftly began pressing for his release on bail. Louis was upset, but he was assured by his FBI handlers that Charlie would likely remain behind bars.

  In support of their application that Charlie be held without bail, prosecutors had submitted excerpts from intercepted phone conversations showing that Charlie had made threats against people who owed him money. In a letter to Judge I. Leo Glasser dated September 8, 2000, Charlie’s lawyer Michael Rosen made a number of observations. To begin with, he noted, the charges against Charlie were lodged in February 2000, but were not unsealed until June. If Charlie was such a threat to society, why was the case kept under seal so long? A fair question. The answer might have been that the feds wanted to give Louis a chance to continue his undercover work—or give Mary Jo White another case to announce at the June 2000 press extravaganza. Or both.

  Rosen went on:

  We learn from the bail hearing before Judge Daniels on June 23, that the alleged “victim” is a confessed stock swindler who, with the aid of the FBI, made telephone calls to the defendant on three days in October 1999. He continues to be under the aegis of the FBI and has been safe from the Fall of ’99 to the present. . . .

  To be sure, the language captured on tape is tough and graphic. Yet, perhaps due to my thirty-five years in this profession, I do not regard the words used as unusual for an alleged “loan shark”—most of whom are admitted to bail. Judge Glasser, I am not downplaying the seriousness of these cases, however, I believe that there are substantial bail conditions that can be imposed even on someone alleged to be a “loan shark.” . . .

  Defendant’s convictions for robbery were over eighteen years ago. His conviction before Judge Raggi in 1992 occurred because of a stupid struggle when he was intoxicated and resulted in a four-month sentence. I respectfully submit that this conduct speaks more of “interference with” rather than “assault on” a federal officer.

  Charles Ricottone is 42 years old and works in his father’s window business. He is a diabetic and suffers from carpal tunnel syndrome. . . . Charles Ricottone is not a danger to his community but, instead, is a contributor. He serves as a volunteer in the New York City School Volunteer Program, helping children read, as evidenced by the attached documentation.

  Attached to the letter were identification cards indicating that Charlie had been a member of the School Volunteer Program at PS 177, Brooklyn, during the 1997-1998 and 1998-1999 school years. Also enclosed was a letter from a neighbor who said that he had known Charlie for fifteen years. He described Charlie as:

  … a very nice person and good neighbor. He is very helpful and caring, attentive to all his neighbors and especially the children who live on West First Street. He has volunteered to help children to read at the local grammar school. He never was mean to anyone on his block. Always had a helpful hand to anyone who needed it. He has always been kind to my children and myself. Charlie is a very caring person. If I ever needed help with anything he was there. I hope you will consider his bail.

  It worked.

  With the agreement of Brooklyn prosecutors, on September 21, 2000, the child-loving, diabetic, good neighbor Charlie Ricottone was released on $800,000 bail. He was kept under house arrest except for visits to his lawyer’s offices and to work with his father as a window installer. It wasn’t clear from the court records whether he was able to continue in the School Volunteer Program.

  Charlie was given no list of Guys to avoid. The days of hit teams and Mob wars were over. That was proclaimed repeatedly in the media. The Mob was dead. Massive gang-bang prosecutions, such as Mary Jo White’s June 2000 indictment-fest, were credited with destroying the very core of organized crime, forever, everywhere.

  Or at least, for the time being on West First Street.

  In October 2000, Brooklyn prosecutors brought additional gambling and loan sharking charges against Charlie and fourteen additional defendants, including Stevie Two Guns, Charlie’s cohort at Aaron. Louis didn’t supply any information to authorities on the gambling charges. There were probably other cooperators. It was a popular thing at the time.

  Elsewhere in the Brooklyn courthouse, other Guys were being brought to justice with little fanfare or publicity. On March 2, 2000, Frank Coppa and eighteen other Guys and brokers were indicted for their alleged control of State Capital Markets, where Louis and Benny briefly peddled Chic-Chick. * Rocco Basile was again indicted, as was Joe Temperino. So was supersalesman Al Palagonia, for allegedly working in concert with the State Street brokers. Gene Lombardo, Frank Coppa’s craggy henchman, was named as well. In June 2001, L. T Lawrence principals Larry Principato and Todd Roberti were indicted in Manhattan. **

  The takeover of U.S. Securities spawned no indictments but by mid-2001 Alan Saretsky was serving a prison term on fraud charges unrelated to U.S. Securities.,

  Then came the guilty pleas—Frank and Rocco and Al and Gene and—just about everybody else. Then a drumroll of sentencings that droned on through the end of 2002. The chop house kids and their Guys were shuffling off to federal detention. Rocco Basile went to prison, and so did Chris Wolf, and so did his tormentors, Dom and Rico. The days of lenient white-collar sentences were over. The days of bullshit SEC sanctions were over. John Moran would have probably been tossed in the clink if he had been prosecuted a decade later. It’s a fair guess that Bob Brennan and Meyer Blinder would have faced the blast furnace of the criminal justice system, instead of skipping daintily over useless SEC lawsuits. And maybe, just maybe, the chop house era wouldn’t have happened. We’ll never know.

  Louis was relieved that he would never have to testify against his old mentor Roy Ageloff—and neither would anyone. Roy had copped a plea.

  Roy pleaded guilty to one count of racketeering, and he spent months dickering with prosecutors over a suitable deal. The rumor was that he was cooperating. The rumor was false. On August 15, 2001, he appeared for sentencing before Judge Raymond J. Dearie.

  Dearie was handing out stiff sentences. Some months earlier, Bobby Catoggio, burdened by a previous conviction, was hit with a twelve-year prison sentence and ordered to pay $80 million in restitution.

  Roy must have been nervous. But he didn’t seem nervous.

  Roy was true to the code. He was Roy to the end. A guy who wanted to be a Guy and was facing his punishment like the Guys of old, like Sonny Franzese. Roy wasn’t ratting out the people he worked with, like his counterpart at Stratton Oakmont, Jordan Belfort. Roy was keepi
ng his mouth shut. It was a slow news day, but this was the Eastern District so reporters weren’t summoned and there was no publicity. Even if reporters had gotten a heads-up, Roy’s sentencing would not have gotten much attention. The bull market that had spawned the chop houses was a memory now. Memories were short. Hanover and Roy were forgotten, even as one of the techniques perfected by Roy at Hanover was coming back in popularity.

  In 2000 and 2001, the financial press was ablaze with news of SEC inquiries into manipulation of Internet IPOs—particularly the “prepackaging” of IPOs, in precisely the way it was done by the chop houses. That is, forcing customers to buy IPO shares after the stock went public, which artificially boosted their prices. (Real Wall Street had its own term for that—“laddering.”) News reports indicated that “boiler rooms” had migrated overseas. The era of the chop houses was over, it seemed, but that summer their spirit lived on in the IPO mess.

  In that Brooklyn courtroom in August 2001, Roy’s concerns were more immediate—keeping his time in prison to a minimum. Half of Judge Dearie’s courtroom was filled to overflowing with friends and relatives of the defendant. The other half, sparse like a wedding between families of far different social strata, contained barely a dozen or so prosecutors and federal agents.

  Roy was in fine form. He was manicured, confident, his slightly simian head topped with an expensive haircut, his stocky features encased in a tasteful gray suit. In recent years he had been an investor in Hollywood productions, and had even appeared in small acting roles a few times. He knew how to hold an audience. But he was producing this show for one man—and Judge Dearie was a tough crowd.

  It would take the sales presentation of a lifetime to get his sentence held to a minimum.

  Roy’s pitch lasted into the afternoon.

  A young cousin testified that Roy was “my second dad.”

  A doctor testified that lengthy incarceration would impose a hardship on the Ageloff family, even though Roy was divorced.

  Roy’s lawyer said Roy was such a devoted parent that he would not curse in front of his children.

  The head of an AIDS foundation, a recent beneficiary of Roy’s largesse, testified that Roy was a “compassionate, caring individual.” Roy became so compassionate (after his guilty plea) that he had volunteered to supervise counselors at a camp for kids with AIDS. He was due at the camp that very day.

  His ex-wife testified that Roy loved his children, and vice versa. Under cross-examination, she denied questions implying that Roy had sometimes hit her. “I probably hit Roy and in the process got hurt,” she said.

  Roy stood directly before the judge. Dignified. No hard sell. “I would like to say how sorry I am and how much I regret what took place based upon greed, stupidity in my life,” he said.

  The judge listened, his face immobile. He was impressed, he said. Moved, he said.

  But he wasn’t buying what Roy was selling.

  Roy certainly loved his children, but there were other kids who weighed more heavily on Dearie’s mind:

  “This sentence sort of brings to mind all of the young folks—and, granted they got on the bandwagon too and they saw the easy money. But I saw so many young men, many with barely a high school education, who got on that sort of gravy train, full of excitement, full of fast money, whose careers, certainly in the securities field, are ruined, that you had a hand in leading astray.

  “I think you have to understand that there are some real victims here. Not only the people who lost the money—they line up by the scores—but you’ve got to take some responsibility, in my view of it at least, for some of those younger people who were here.”

  Judge Dearie refused to cut Roy’s sentence because of his family obligations and philanthropy. He sentenced Roy to eight years in prison, and to pay $8 million in restitution.

  Roy’s lawyer pleaded to give Roy a few weeks to say goodbye to his children. Roy apparently expected this request would be granted, because his burly black bodyguard was waiting, hands clamped behind him, right outside the courtroom doors.

  Judge Dearie wanted Roy in jail now. “Defendant is remanded,” he barked. As his relatives cried, the marshals swiftly cuffed Roy’s hands behind his back and led him to a door at the far corner of the courtroom.

  Roy’s composure wavered. He gave a quick look toward his family as they led him away.

  Benny and Marco weren’t part of the June 2000 festivities. But Louis knew their day was coming. He was going to see to that. He had no choice. You had to go all the way when you were a cooperator, just as you couldn’t be a little bit pregnant.

  Throughout 2000, Louis had been giving the FBI, NASD, and SEC information on Nationwide as well as the other firms where he’d worked. It was only a matter of time before the feds acted. On December 12, 2000, the inevitable happened. A five-count indictment by the Manhattan feds. The list of names in the indictment was headed by Benny and Marco, and included his old associate Tommy Deceglie, who had lost the Elmo arbitration, Sonny’s guys Howie Zelin and Glenn Benussi, Louis’s pals Frank Piscitelli and Dave Lavender, and, sadly as far as Louis was concerned, Charlie’s brother Mike Ricottone. Mike had gotten a job as a cold-caller and had made very little money at Nationwide. “They just put him there to get at Charlie,” Louis said. The feds fought dirty.

  The guilty pleas for the Nationwide crew began in August

  2001. Howie, Dave, Tommy, Frank. Kid brother Mike. Marco.

  Benny.

  When Louis heard about Benny’s guilty plea to two securities fraud counts, on August 13, 2001, he felt a pang. Relief that he would not have to face his old friend in court. And that familiar old feeling, the one that he had ignored for so many years.

  He could live with it. He had no choice.

  On June 4, 2002, Marco was sentenced to fifty-one months in prison by Judge Lewis A. Kaplan. Appearing before the same judge three weeks later, Benny received a forty-nine-month sentence. He was ordered to undergo substance-abuse treatment while in prison.

  Louis had no role in Benny’s other legal troubles. Benny was arrested again by the feds, in May 2001, for his alleged involvement in a Brooklyn drug ring after he left the Street. Benny pleaded not guilty, and the charges were pending as this book went to press.

  Drugs also proved a heavy burden, in every sense of the word, for Robert Luciano, the gold-shop proprietor who was involved in Louis’s fence-jumping incident. In 2000 he was nabbed by the feds for importing a tractor-trailer load of marijuana. By then, the gold shop had morphed into an Italian ices stand.

  Louis never had to face Charlie in court. On November 29, 2001, Charlie pleaded guilty to reduced charges in the June 2000 case and the subsequent gambling indictment. He was sentenced on April 16, 2002.

  Charlie’s family and friends were not in the courtroom. John Brosnan, blond and lanky, dressed in a polo shirt and khaki pants, lounged at the prosecution table, impassive, as Michael Rosen put his case before Judge Glasser, who was gaunt and scowling and faintly resembled Martin Landau in

  the role of Bela Lugosi. Brosnan’s blank-faced partner Kevin Barrows, wearing dark-rimmed glasses, was in the very rear of the almost empty courtroom. An elderly man sat in front of him.

  Charlie was deeply tanned, wearing a white shirt and black pants. His hair was close-cropped. His hands twisted nervously behind him as his lawyer argued and Glasser occasionally made a biting and unsympathetic rejoinder. A tough judge. Retribution time. Chickens coming home to roost.

  Much discussion of the dispute at the Canarsie pier ten years before. The altercation. The police officer’s sprained thumb.

  The threat to the prosecutor back then.

  No, it was not at all humorous, Rosen readily conceded. But no, it would be so unfair, so unjust, so disproportionate for that little brawl on a pier to result in declaring Charlie a three-time loser, a career criminal, thereby justifying a much higher sentence under the federal incarceration guidelines.

  Judge Glasser was unmoved, rigid. “A
legal argument of a very shallow order,” he said at one point, driving a stake through one of Rosen’s arguments. Rosen persisted. That 1992 pier brawl, that drunken expression of unleashed Guy bravado, “should not be the fulcrum that makes this the third strike” and converts Charlie from a mere multiple offender into a career criminal.

  Not with all that he had done, all that he had strived to do, all the people he had touched so very positively. The young lady who had written the judge a letter saying that Charlie had saved her from a life of drugs. The young man, now a high school football quarterback, who had nothing but good things to say about Charlie. The senior citizen, the one in the back of the courtroom, who was ready to get up in court and tell the judge, right to his face, all of the things that Charles Ricottone had done for the people of Brooklyn. Positive things.

  Rosen continued to plead for his client.

  He is a decent person. He has a checkered and regrettable past. He has made some disastrous choices, but he is a school volunteer now. He does give back. He works with children. “That should be a plus,” said Rosen.

  Charlie spoke. His hands were behind his back, and he wore glasses now, and his stocky build and tieless white shirt/black pants combo gave him the fleeting appearance of a cross between Al Jolson and a waiter.