We are searching data for your request:
Upon completion, a link will appear to access the found materials.
Police finally figured out how a restaurant with no customers stays in business
Police figured out how a restaurant with no customers managed to stay in business.
Minneapolis police finally figured out the secret of how a local pizza restaurant with very few customers and one star on Yelp managed to stay in business this week when they busted the owners for running a drug-trafficking operation out of the kitchen.
According to Valley News Live, Dmitri Brooks--the owner of Papa Dmitri’s Classic Pizza and Ice Cream in St. Paul, Minn.--was allegedly running a massive marijuana trafficking operation through the restaurant with the help of his mother, his girlfriend, and his 82-year-old grandmother. Police were tipped off over the summer by a concerned citizen who said the restaurant was almost never open and rarely had any customers, but it somehow stayed in business. As odd as that was, however, the most damning bit of evidence was that the employees in the restaurant were reportedly frequently seen getting take-out at other restaurants in the area.
"Yeah, they'd always take takeout," said Jack Knutson, an employee at a nearby restaurant. "You deliver four pizzas in a week and then you have an Escalade sitting out front for just a little bit. It's like you know something's going down."
In response to the complaint, police watched the restaurant for six days. During that period it had five customers and made four deliveries, and Brooks only came by once for a grand total of half an hour.
Brooks was arrested Friday after police investigating his home allegedly found marijuana, cocaine, a handgun, and vials labeled “testosterone.” The restaurant, however, is reportedly still open. Brooks’ mother was running the place Saturday and said she had no knowledge of any drugs at the very quiet pizza shop.
Cocaine ring based in New York pizzeria broken up, say Italian police and FBI
Cassava sellers in Paraguay. US agents seized 55kg of cocaine hidden in shipments of the root vegetable from Central America to Pennsylvania and Delaware, say officials. Photograph: Jorge Adorno/Reuters
Cassava sellers in Paraguay. US agents seized 55kg of cocaine hidden in shipments of the root vegetable from Central America to Pennsylvania and Delaware, say officials. Photograph: Jorge Adorno/Reuters
Last modified on Sun 4 Mar 2018 12.52 GMT
A major cocaine trafficking ring run out of a New York City pizzeria was dismantled after a transatlantic probe revealed that the Italian ’Ndrangheta crime syndicate has expanded its ties with New York’s traditional mafia crime families, Italian police and US FBI agents said on Thursday.
At least 13 people were arrested in pre-dawn raids in Calabria, the region in southern Italy that is the power base of the ’Ndrangheta , which has increasingly taken advantage of the Sicilian Cosa Nostra’s disarray to consolidate its influence and operations in the US, officials said at a joint Italian-US news conference in Rome.
Three other Calabrians were arrested in New York several weeks ago. All were members of the family that ran the pizzeria in the Corona neighbourhood of Queens, New York’s most populous borough, authorities said.
The restaurant, Cucino a Modo Mio (“I cook it my way”), was the command centre for an international trafficking operation, said Andrea Grassi, who is in charge of an Italian state police special operations unit known as SCO. Authorities said they seized more than 60kg of cocaine in the Netherlands and Spain during the inquiry that began last year.
“In the evening, the family ran a good pizzeria. In other hours they were running the drug trade,” Grassi said.
The pizzeria also served as a weapons cache for drug traffickers, investigators said.
Police said operatives bought the cocaine in Costa Rica with cash brought in specially constructed suitcases. The cocaine was warehoused in Wilmington, Delaware, and Chester, Pennsylvania, until it could be shipped, using a produce company as a cover, to northern Europe and Italy, investigators said.
American agents seized 55kg (121lb) of cocaine hidden in two shipments of fresh cassava from Central America to Philadelphia and Delaware, officials said.
The ’Ndrangheta has operatives in Australia and Canada, but this inquiry, code-named Operation Columbus, convinced investigators that the syndicate has increasingly moved its foot soldiers and bosses to the US , said Renato Cortese, a top Italian police official.
“Because of its blood ties, the ’Ndrangheta is a terrible organisation,” Cortese said. He was referring to the syndicate’s ironclad rule of relying on members who have either family or marriage ties. Family pressures discourage turncoats, a small army of whom helped weaken Sicily’s Cosa Nostra, which largely chose its mobsters based on skills and not blood ties.
The Calabrian family that ran the pizzeria in New York allegedly turned to the US mafia’s Genovese crime clan for financing so they could invest in the cocaine trade, Calabria-based anti-Mafia prosecutors said.
79 Seized in New York and Italy Echoing Pizza Connection Case
It looked like an ordinary New York pizza parlor, its Formica tables crowded at lunch yesterday with midtown office workers and a long line of customers snaking along a counter in front of the ovens.
But Federal authorities said that the Famous Original Ray's Pizza on Third Avenue near 43d Street was actually the headquarters for a major drug ring. An d in a new variation for the ever-changing international drug trade, the authorities said, the pizzeria gang didn't just import cocaine from Colombia to feed New York City's big appetite for drugs. It also used New York as a transit point to deliver drugs to three longstanding organized crime groups in Italy, where cocaine sells for three times what it costs in New York.
With two other groups of loosely affiliated traffickers, working out of a cafe and a butcher shop in Brooklyn and their homes in Brooklyn, Queens and Staten Island, the smugglers at the pizza parlor handled "tens of millions of dollars" worth of cocaine and heroin over the last three years, according to William A. Gavin, the head of the Federal Bureau of Investigation in New York.
It is difficult to gauge how big a share of the New York drug market was accounted for by the three groups, the authorities said. But after three years of tracking the drug traders in New York and Italy, the authorities in both countries rounded up 79 suspects overnight and charged them with drug conspiracies. In New York alone, 200 agents took part in the arrests. Some were seen carting boxes of records away from the pizza parlor shortly after dawn yesterday.
Regular customers of the pizza parlor, as well as business people in other restaurants, delicatessens and bars packed cheek by jowl along Third Avenue, said they were stunned to hear that a big drug ring had been doing business in their midst.
Douglas Flinn, an owner of Salad Daze, a fast-food health restaurant next door, said he had often spoken with the three Ambrosio brothers -- Aniello, Francesco and Roberto -- who ran it and who were among 29 people taken into custody in New York.
"They seemed like very nice guys," Mr. Flinn said. "This is the first I've heard anything about drugs and them. It ruins the block that drugs are next to us. We're health, they're drugs."
A thin man in a white shirt and red apron who was at the cash register at Famous Original Ray's Pizza said he knew nothing about any drugs or arrests, but he offered to pass on a message to the Ambrosios if they phoned in.
There are many pizza parlors in New York with names like the one at 686 Third Avenue. But Mary Jo White, the United States Attorney in Manhattan, said no others were involved in the drug investigation.
Agatha Mangano, the general manager of a group of 18 pizza parlors founded by her father, Rosolino Mangano, in the last 30 years, said the family had given a franchise for the outlet at 686 Third Avenue to the Ambrosios in March 1992. The family never imagined that the Ambrosios might have been involved with drugs, she said, and worried that the reputation of all their restaurants would be tainted.
"We didn't look into their backgrounds," she said. "We didn't really know them. They were just very persistent and wanted our franchise. They were good actors, very family oriented, and they didn't give us any suspicions at all."
The case recalled a big drug-smuggling operation in the late 1970's and early 1980's referred to as the Pizza Connection. In that case pizza parlors in New York, New Jersey, Long Island and the Midwest were used to distribute heroin -- not cocaine -- brought into the United States by Sicilian gangsters.
The authorities said that in the current case, as in the Pizza Connection, a pizza parlor was employed as a meeting place for arranging wholesale transactions, not as a retail outlet where addicts could buy bags of heroin. In the previous case, the pizza parlors, which appeared to be legitimate food shops, also provided a channel for depositing earnings from drugs into bank accounts in the guise of pizza profits.
While the Pizza Connection smugglers had some dealings with the Bonanno crime family, those accused in the current case, most of whom are emigre Italians, worked independently of the five organized crime families in New York, the authorities said.
Over the last several years, Federal investigators have had reports that the United States was becoming not only a final destination for cocaine from Colombia, but also a way station for Europe. But this case provides the first concrete evidence of this on a regular basis.
Because the price of cocaine is so much higher in Italy than in New York -- about $60,000 a kilogram wholesale, compared with $20,000 -- the dealers in New York were able to make big profits acting as middlemen, law-enforcement officials said. Presumably, the Colombians who supplied the cocaine were unaware that it was being reshipped to Europe at a higher price.
"You take a risk bringing the cocaine into New York, where there's a lot of law enforcement, and then shipping it back out," said a Federal investigator. "But there's a lot of money to be made."
Federal authorities said the Ambrosios also arranged for some cocaine to go directly from Colombia to Italy, collecting a commission from the Colombians for setting up the sale. One such shipment was intercepted at Bogota Airport in November, the authorities said: 168 kilograms of cocaine hidden in crates of cut flowers that were to be taken to Italy aboard an Alitalia airliner.
How Do Criminals Launder Money Through a Restaurant?
No one would have described Mizu Sushi Lounge in Puerto Vallarta, Mexico as nondescript. It wasn’t a traditional Mexican restaurant by any means. Patrons dined on deep-fried sushi rolls, and washed the quasi-fusion food down with icy glasses of sangria. Mizu hosted anniversaries, birthdays, and Oscar-viewing parties — and guests made sure to document each boisterous celebration on Facebook. In fact, more than 500 people "checked in" to Mizu via various social media platforms, and many gave it high marks on online review sites. It was a place to see and be seen.
In September 2015 the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) deemed five Mexican businesses "Specially Designated Narcotics Traffickers," froze each business' assets and prohibited any U.S. company from doing business with them. All five businesses were found to have laundered money in order to provide financial support to Mexico’s Cartel de Jalisco Nueva Generation, an international drug trafficking ring. Mizu Sushi was one of the five.
Restaurants involved in money laundering are legitimate businesses with real profits.
In gangster films of the '50s, '60s, and '70s restaurants involved in money laundering are often depicted as small operations with few customers. They're nothing more than a facade to hide illicit activities. In reality, though, many restaurants involved in money laundering are legitimate businesses with cooks, a waitstaff, a menu, and real profits. It’s the intermingling of legitimate profits with proceeds from illegal activities (like drugs or human trafficking), that constitutes money laundering.
"Restaurants are a classic way to move money," says Kieran Beer, chief analyst of the Association of Certified Anti-Money Laundering Specialists. Beer adds that pretty much any cash-intensive business can be used to launder money — laundromats, used car dealerships, taxi services — but restaurants tend to crop up again and again in money laundering cases.
Want to know why? Here’s the gist. But first:
What is money laundering?
Money laundering is the act of disguising the source of money obtained via illegal means. To put it more simply, it’s the act of hiding money this money is casually referred to as "dirty" money.
"In basic terms, money laundering is when a business has ties or connections to organized crime and suddenly starts to book incredible — or even normal — sales," says Beer. "That’s what criminals want to achieve — take dirty money from drugs or human trafficking or another criminal endeavor, and put into the system to make it look clean. Then, they can buy homes and cars, and it looks like the money was made legitimately."
Professor Kerry Myers, who specializes in forensic accounting and money laundering at the University of South Florida (and also worked alongside the FBI’s money laundering divisions for 25 years), has a similar definition. "A financial transaction involving proceeds from a criminal activity or designed to support a criminal activity, is money laundering," says Myers. "That’s a very broad definition, at least."
How does it work?
The first step in this criminal enterprise is to find a business. Then, buy it.
"If I’m a drug kingpin, the last thing I would want is one of the waitresses having any idea what I’m doing."
"Buying a restaurant that’s already in operation would be the easiest way, because it already has employees," says Myers. The employees don't even have to be aware that money laundering is taking place — in fact, most probably shouldn’t be. "If I’m a drug kingpin, the last thing I would want is one of the waitresses having any idea what I’m doing. You essentially want it to be a legitimate business."
It isn't necessary that the restaurant being used has a lot of cash on hand, either. "You could have a restaurant that has very few customers, but is able to open an account with a bank," says Beer.
Of course, if it is a popular restaurant, that can serve as an ideal smokescreen for money laundering. "You don’t want to pick a front company," says Myers. "If I’m going to launder money, I would want a business where, if the FBI or IRS stops by, there are a lot of customers coming and going. That way, the revenues are justified by the clientele." (That’s why Mizu Sushi, in Puerto Vallarta, was a solid choice through which a drug cartel could funnel its money: It was an active business that seemed to generate pretty good revenue.)
The success of a money laundering operation hinges largely on one action: getting the dirty money into the bank. Myers offers an example: "Let’s say I'm with a Mexican drug cartel. I have a lot of money from selling cocaine. So I want to take the cash from that illegal activity and turn it into clean money. So, I go out and buy a restaurant. Every day, I collect my restaurant receipts to take to the bank and make a daily deposit. But I also take a major portion of my drug proceeds and mix it in with my restaurant proceeds. Then, I make the deposit. Because I am doing this continually, and as long as the cash stays roughly within ten percent of the same amount every time, the bank won't be as suspicious. Because you would expect a restaurant to have all that cash on hand. It looks like sales of food and alcohol."
Once the money is deposited, it is either transferred to tax havens, or used to buy and sell real estate, cars, etc., thereby generating real (i.e. legal) profits.
Why use a restaurant?
"Money laundering almost always involves cash," says Myers. "You can't launder money using a credit card, or a wire transfer, or cashier’s check, because they're traceable. So you are looking for a business with a lot of cash turnover. Cash isn’t traceable."
You expect a restaurant to have that much cash on hand.
Like many small businesses, restaurants are cash-intensive. Bringing large sums of cash to a bank might not necessarily be a red flag, so long as it appears the money is coming from a legitimate business.
Also, restaurants aren’t necessarily subject to much oversight. If a restaurateur reports that his sushi spot is always at full capacity (when, in reality, no one has visited in months), the feds will likely be none the wiser.
Has technology made money laundering through a restaurant any easier?
Actually, technology has made it more difficult to launder money. "Unless you’re using virtual currency such as Bitcoin, it isn’t easier today today than it was forty years ago," says Myers. "In reality, every bank has highly sophisticated software that can flag transactions much more easily than they could in prior years."
Most major financial institutions have entire anti-money laundering units or departments that constantly look for violations. Banks also cross-check names with those on OFAC lists. The Office of Foreign Assets Control (OFAC) maintains a list of individuals or entities like Mizu Sushi, that have gotten in hot water for money-laundering in the past (terrorist organizations are also included).
How can someone get caught?
Beer admits that "it can be tough" to spot a money-laundering enterprise. One of the best watchdogs of illegal behavior isn’t always the feds. In cases of money-laundering, it's usually banks that are the first to notice.
"Community banks, and even a lot of big banks, really know their customers," says Beer. "When you begin a relationship with a bank, they might look into your revenue, usually in relation to revenue of other restaurants nearby. If they get suspicious, they could check up on you and find that there’s no one actually patronizing the restaurant."
Banks are always watching for red flags.
A bank employee might also note that a modest business is suddenly booking more profits, but doesn't appear to be using the money to grow the business. "If a bank sees a restaurant is doing a million dollars in business and the checks they are writing to distributors are much less than that, that’s a concern. If they pay all their vendors in cash, that would be a red flag, too," says Beer. "Banks do not want to be accused of having ignored money laundering."
There is a limit to how much money one can launder without drawing suspicion. According to the Bank Secrecy Act, banks must file a report any time someone deposits or withdraws more than $10,000 in cash.
That’s why, says Myers, a successful money launderer "will never deposit more than $8,000 or $9,000 a day in cash." But banks know that people will try to work their way around the laws. So, if someone tries to defeat those regulations by structuring their deposits (depositing $8,000 one day and $9,000 the next, for example), the bank can also file a report.
With so many safeguards in place, it’s unsurprising that so many money launderers end up getting caught. "It would probably be easier to launder money the old-fashioned way," says Myers. "By flying into Vegas with a suitcase full of cash, walking down the strip, and purchasing and selling $8,000 in chips at each casino. In effect, you’d be washing the money."
Honolulu man found with 24 pounds of cocaine is indicted for drug trafficking
Ping Hong Lee of Honolulu was arraigned Tuesday before Magistrate Judge Wes R. Porter on an indictment charging conspiracy to distribute and possess with the intent to distribute cocaine, possession with intent to distribute cocaine, possession of a firearm in furtherance of a drug trafficking crime, and felon in possession of a firearm and ammunition.
Lee, who was found with about 24 pounds of cocaine and a loaded Charter Arms .38 caliber pistol, pleaded not guilty to the charges. His trial is set for March 30 before Senior District Court Judge Helen Gilmore
Law enforcement officers observed Lee, the lone occupant of a 2018 Porsche Macan GTS, pull into the pickup area of a Waikiki hotel on Jan. 13, according to court filings. While there, a male entered the backseat of the Porsche with a dark blue duffel bag and then exited without the dark blue duffel bag. After Lee drove away, law enforcement officers tried to conduct a stop of the Porsche but were unsuccessful. The Porsche and Lee were found minutes later. Within the Porsche, law enforcement officers recovered approximately 24 pounds of cocaine from within the dark blue duffel bag, a loaded Charter Arms .38 caliber pistol, and U.S. currency.
Lee has a prior 2012 federal drug distribution felony conviction.
If convicted of the charges, Lee faces a mandatory minimum sentence of 20 years in prison and up to life.
The case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant U.S. Attorney Darren W.K. Ching.
Click here to see our full coverage of the coronavirus outbreak. Submit your coronavirus news tip.
SUBSCRIBE NOW Daily News
LAWRENCE, Kan. — Sarah Gonzalez McLinn, 20, is standing trial in Douglas County for the brutal murder of her roommate, a 52-year-old businessman who owned a CiCi’s Pizza restaurant in Lawrence and two others in Topeka.
Harold Sasko was killed Jan. 14, 2014, but he wasn’t found for three days. When police found Sasko’s body at his home with his neck butchered, they realized McLinn was missing along with Sasko’s 2008 Nissan Altima. On January 25, McLinn was found in Sasko’s car illegally camping in the Florida Everglades and taken into federal custody on an unrelated drug charge. She was soon returned to Kansas.
On Tuesday morning, March 17, jurors listened to opening statements, at which time McLinn’s attorney, Carl Cornwell, told jurors that McLinn suffers from mental illness, causing her to have two personalities.
Testimony began shortly thereafter, with Detective David Axman, Lawrence Police Dept., taking the stand.
Axman showed a four-feet piece of sheetrock from Sasko’s home. A stick figure with a face is drawn on it, along with a heart drawing, and the upper and lower abdomen, which was labeled with “Major Organ 1 & 2.” The stick figure’s thigh areas were circled and labeled “Major blood vessel” with arrows pointing to groin area.
There are holes and indents all over the , and Axman says they are consistent with someone throwing a knife at the stick figure, leaving holes where the blade hit.
The prosecuting attorney, David Melton, told jurors that three of 15 beer cans found in the residence had traces of Ambien in them. According to investigators, Sarah McLinn admitted crushing sleeping pill into his beer so he would pass out.
During her preliminary hearing, Detective MT Brown, Lawrence Police Dept.,the detective who interrogated her after her arrest, testified that McLinn decided five days before she killed Sasko that he would be the target of her violent thoughts. She reportedly told Detective Brown that Sasko had mentioned taking his own life anyway.
For more on Brown’s gruesome testimony during the preliminary hearing, click here for the previous story.
After Detective Axman’s testimony, the coroner, Dr. Erik Mitchell testified. he showed jurors a picture of Sasko’s head, face and neck, with deep, straight wound lines in his throat from side-to-side. Dr. Mitchell says Sasko’s neck was cut deep, almost to the spine. When the prosecution questioned Dr. Mitchell about the murder weapon, he confirmed that a large hunting knife the prosecution showed jurors could have been used to kill Sasko.
As was the case in other court appearances, FOX 4’s Melissa Stern reports that McLinn rarely looks up during the proceedings.
Friends of hers are there to support her, but admit the testimony is difficult.
“My Sarah has been dear and sweet, and a wonderful addition to our home and our family trips, and I love her very much and wish the best for her and her family,” said her friend Rebekah Crawford. “It’s been a lot to take in, and our thoughts and prayers are with Sarah and her family, and everyone involved in the process.”
McLinn went to high school in Topeka. She worked for Sasko at one of his three CiCi Pizza restaurants. Sasko’s relatives reported he let McLinn move into his house in Lawrence while she was dealing with personal problems.
District Attorney Charles Branson said the method used to kill Sasko has been determined as “heinous, atrocious, and cruel” in nature. Branson has requested a ‘hard 50 penalty’ in this case, which is a life sentence with a chance of parole after 50 years.
(on left) Harold ‘Hal’ Sasko, 52, (on right) Sarah Gonzales McLinn, 19
If McLinn is found guilty of premeditated first-degree murder and the felony theft of Sasko’s vehicle, she would likely receive the ‘hard-50’ penalty due to the aggravated findings of this case. According to Branson, in the state of Kansas, the punishment would normally be life in prison with a chance for parole after just 25 years.
Federal Witness in 'Pizza' Case Recants Testimony on Mob Boss
A former underworld killer who became a protected Federal witness has come out of hiding to recant testimony that helped send a New York Mafia boss to prison for 45 years in the ''pizza connection'' case.
The witness, Luigi Ronsisvalle, says he has quit the Federal Witness Protection Program and voluntarily sought out the convicted man's lawyer to provide a sworn statement that his testimony against the defendant, Salvatore Catalano, was false.
Twice in recent weeks, in a cramped motel room and restaurant outside Cincinnati, the lawyer, Ivan S. Fisher, met with Mr. Ronsisvalle in the presence of this reporter. Mr. Fisher paid Mr. Ronsisvalle $2,620 for what both men called expenses. Each maintained in interviews that the recantation was not made in exchange for the money. 'I Feel Like Crying'
At one point during the first meeting, Mr. Ronsisvalle blurted out: ''Mr. Fisher, I want you, please, from the bottom of my heart, I want you to accept my apology for what I done to Toto Catalano. I swear to God, I feel so bad, I feel like crying.''
Mr. Fisher said he would seek a new trial based on Mr. Ronsisvalle's recantation.
Rudolph W. Giuliani, the United States Attorney in Manhattan, who supervised the prosecution in the pizza connection case, said a recantation by Mr. Ronsisvalle would not jeopardize Mr. Catalano's conviction.
''There was an overwhelming amount of testimony against him,'' Mr. Giuliani said. A Question of Motives
Several factors that might explain the recantation were still open to question. It could not be determined with certainty, for example, whether any representative of Mr. Catalano had talked or negotiated with Mr. Ronsisvalle, or even threatened him, although both Mr. Ronsisvalle and Mr. Fisher denied this. During the interviews Mr. Ronsisvalle repeatedly asked for money but the possibility could not be ruled out that money had been passed to him or promised to him before the interviews.
Still, Mr. Ronsisvalle's reversal raises uncertainties about some of the evidence used to convict Mr. Catalano, and perhaps about other aspects of the 17-month trial, the longest and one of the costliest Federal criminal trials on record. It also suggests that Mr. Ronsisvalle committed perjury before the President's Commission on Organized Crime.
In addition, Mr. Ronsisvalle said he would refuse to testify, as scheduled, at two coming trials of major Mafia figures. Questions About Treatment
At the same time, Mr. Ronsisvalle's statements raised questions about his treatment under the Federal witness program.
Mr. Fisher, one of the nation's most sought-after and highly paid criminal lawyers, said he would present the new testimony today to the United States Attorney in Manhattan. Mr. Fisher has also prepared an application asking the judge in the case, Pierre N. Laval, for a hearing on granting Mr. Catalano a new trial on the ground of newly discovered evidence.
Advised yesterday afternoon of Mr. Ronsisvalle's affidavit, Mr. Giuliani and his chief prosecutor in the case, Louis Freeh, in a joint telephone interview, described Mr. Ronsisvalle as a '𧮬kground witness'' whose testimony was not crucial to any particular charge of the indictment.
''Had Ronsisvalle not testified it would have made absolutely no difference,'' said Mr. Freeh. ''There were numerous other witnesses who convicted him.'' They said they could not comment further until they reviewed the legal papers Mr. Fisher is to file today.
The new account by the 47-year-old, Sicilian-born Mr. Ronsisvalle almost automatically subjects him to a prison term for perjury, Mr. Fisher said. What Are the Motives? But whether Mr. Ronsisvalle was lying then or is lying now remains far from clear. During the meetings, he indicated a variety of motives for recanting. Although he has confessed to committing 13 contract murders without remorse, he says he is so haunted by a guilty conscience for lying that he cannot sleep.
But he has also repeatedly asked for money, which Mr. Fisher said Mr. Catalano was willing to pay in an aboveboard manner.
Mr. Ronsisvalle has also suggested he feared retaliation by Mr. Catalano. Asked if he thought Mr. Catalano was out to kill him, Mr. Ronsisvalle replied, ''Not any more.''
He also expressed disgust with his living conditions under the witness program, saying he had been shuttled between six cities in a year and had not been able to find permanent work.
He also told Mr. Fisher: ''I got three daughters. God is my witness. If I lie to you now, may my daughters drop dead with the worst things God can give to human beings. I'm swearing to you on my three daughters.''
He then signed an affidavit saying he lied in the pizza connection trial last year when he linked Mr. Catalano to a heroin delivery on a Brooklyn street and a conversation about heroin trafficking. The statement declares, ''Some of the testimony I gave at the trial of that case is not accurate and was not accurate at the time I gave it.''
In his own sworn account, Mr. Fisher said that before the meetings at the motel, he received an unbidden call from an unidentified representative of Mr. Ronsisvalle, who said the former witness wanted to meet with him. Mr. Fisher then invited this reporter to accompany him and his private investigator, Charles W. Kelly, as a way, he said, of dispelling any suspicion of underhanded dealings. The conversations, with Mr. Ronsisvalle's foreknowledge, were openly tape-recorded. But there was no way of knowing what, if anything, might have been discussed on other occasions outside the reporter's presence. Key Testimony In Pizza Trial
Mr. Ronsisvalle's testimony was one of four key pieces of evidence against Mr. Catalano, the leader of a Sicilian faction of the Bonanno crime family charged with leading a Mafia-backed drug racket, operated in part through pizza parlors, that imported an estimated $1.6 billion worth of heroin into the United States up to 1984, when Federal Bureau of Investigation raids broke the case.
The other major evidence included Mr. Catalano's fingerprint on a slip of paper said to have been exchanged at the time Mr. Catalano turned over a suitcase containing $1.54 million cash, and his presence, according to witnesses, at two meetings of drug traffickers in Sicily.
Convicted along with 17 other defendants last March, Mr. Catalano was sentenced to 45 years in prison, fined $1.15 million and ordered to pay $1 million restitution to a fund for the rehabilitation of drug addicts. He is serving his sentence in the Leavenworth Federal Penitentiary in Kansas.
Mr. Ronsisvalle gave public testimony before the President's Commission on Organized Crime in Miami in 1985, and in statements to the Federal Bureau of Investigation.
At the time of Mr. Ronsisvalle's original testimony in January 1986, Mr. Fisher was unable to shake Mr. Ronsisvalle's testimony against Mr. Catalano, despite rigorous cross-examination. 'They Showed Me the Pictures'
But in the conversations Sept. 19 and last Tuesday at the motel, where he was staying under an assumed name, Mr. Ronsisvalle said he had implicated Mr. Catalano as a way of winning his own early release from prison. But as it turned out, by the time he was accepted as a witness he had served his sentence. He said no Government prosecutor had encouraged him to testify falsely or was even aware, as far as he knew, that he had done so. But he said he had got the idea from leading comments by investigators.
''Somehow I put him in the middle, I don't know how,'' Mr. Ronsisvalle said of Mr. Catalano. ''I'm trying to give it to you straight, but he's not there. I don't know what happened. Somehow the guy pops out on the corner.'' The testimony, he said, came ''out of the blue - he never was there.''
He said ''they showed me the pictures'' - a reference to the surveillance photos investigators had showed him - 'ɺnd while they were talking, I put two and two together.'' He concluded, he said, that Mr. Catalano was a key figure of interest to the Government, and that making up compelling testimony against him would win him a ticket out of prison as a witness.
He said, however, that all his other testimony, including his identification of Mr. Catalano as a Mafia boss in charge of gambling dens on Knickerbocker Avenue in the Bushwick section of Brooklyn, was truthful. 'I Live Like a Dog'
Mr. Ronsisvalle said ''I live like a dog'' and had to drink himself to sleep at night 'use I can't take what I did in this court - a liar.''
He said the only appreciable difference between the motel rooms he had been placed in around the country in the last 15 months and the cells in the Metropolitan Correctional Center in Manhattan were that in the prison, ''the floors look a little bit better.'' He added, ''What I've got is one thing. I can go out, buy a cup of coffee, get drinks. I'm still in goddamn prison.''
He also said he would refuse to testify in two imminent New York Mafia trials, one involving Anthony Aiello, a longtime fugitive cafe operator and accused drug trafficker, and the other involving Joseph N. Gallo, a reputed counselor in the Gambino crime family. But he said he would gladly testify against another mob defendant, Vincenzo Napoli, who, he previously testified, had once tried to kill him in a hotel room.
''These people, they think they own me,'' he said of Government prosecutors. He voiced other complaints against the Witness Protection Program. He said that without a resident alien's ''green card'' or other ample identification in his new identity he could not find work.
But Mr. Ronsisvalle also made it clear he was looking to get paid. At one point he complained to Mr. Fisher, ''You still don't talk about money.''
''I'm being straight with you, completely straight with you,'' Mr. Fisher responded. ''The money question depends entirely on how much this is worth.''
The Government also gives money to its witnesses, Mr. Fisher said. Mafia Training: Carrying Drugs
Mr. Ronsisvalle has a history of dramatic turnabouts that made him a Government witness in the first place.
In his testimony in the pizza connection trial and elsewhere, Mr. Ronsisvalle said he was born in Catania in eastern Sicily, and came to New York in 1966, at the age of 26, carrying an introduction to a member of the Bonanno family on Knickerbocker Avenue, a Bonanno stronghold.
Although he was not himself a ''made'' or inducted member of the Mafia, he was apprenticed to Mafia soldiers who, he testified, taught him how to smuggle heroin aboard planes and trains and in cars. From 1975 to 1976, he said, he drove 80-pound loads of heroin on 15 occasions from members of the the Bonanno family to members of the Gambino family in Brooklyn -some $120 million worth of heroin at wholesale prices - for $5,000 a trip. On 15 other occasions, he said, he delivered 40-pound loads of heroin by Amtrak to customers in Chicago.
Mr. Ronsisvalle also testified that he had committed 13 murders, 6 for pay. The last one, he said, was in 1976, when he shot a Brooklyn restaurant cook said to have raped the 14-year-old daughter of a man who had gone to the Mafia seeking vengeance. A $100,000 Offer
Mr. Ronsisvalle turned himself in and pleaded guilty to that killing in 1979, he later said, as a way of getting back at Michele Sindona, the criminal Italian financier who, Mr. Ronsisvalle said, had hired him to intimidate a Wall Street witness against him.
Mr. Ronsisvalle testified that Mr. Sindona had also offered to pay him $100,000 for the assassination of an assistant United States attorney, John Kenney, a plot that was never carried out.
It was after Mr. Ronsisvalle was arrested in a purse snatching and went to Mr. Sindona for $30,000 in bail money, only to be rebuffed, that Mr. Ronsisvalle turned himself into Federal authorities and confessed the Brooklyn murder and his dealings with Mr. Sindona. Mr. Sindona was poisoned in his prison cell in Italy in March 1986.
Mr. Ronsisvalle also provided information on Mafia figures he knew from Knickerbocker Avenue, including Mr. Catalano, although he did not provide any specific details of drug-trafficking. Voluntary Polygraph Test
He voluntarily took a polygraph test on some of his information. Responses to two questions were judged truthful by the New York police examiner. Two other responses relating to knowledge he claimed to have about the 1979 killing of the Gambino family boss, Carmine Galante, were evaluated as deceptive.
For the murder of the restaurant cook, Mr. Ronsisville was sentenced to 5 to 15 years in prison, which the Government agreed to let him serve in a Federal penitentiary, although he was convicted on New York State charges. It was in February 1985 that Mr. Ronsisvalle, thinking he would still have more time to serve in his Minnesota prison, contacted a New York City police detective, Kenneth McCabe, and offered to give authorities further information on the Mafia.
In April 1985, Mr. Giuliani advised the New York State Board of Parole that Mr. Ronsisvalle ''has been consistently providing valuable investigative and testimonial evidence'' on organized crime and narcotics trafficking. He asked the agency to take this cooperation into consideration in evaluating him for early release. Mr. Ronsisvalle had served his time, never returned to prison and was placed in the Witness Protection Program with his wife and three daughters.
He quickly became a star witness at a Miami hearing of the President's crime commission, where he gave his first public testimony implicating Mr. Catalano in a heroin deal. Heroin in a Porsche
Mr. Ronsisvalle said that in late 1977 or early 1978 he and an accomplice had picked up 220 pounds of heroin in Florida and driven it to New York concealed in a Porsche. On Knickerbocker Avenue, he said, his accomplice, Felice Puma, met with Mr. Catalano on the street. Another man, Domenick Tartamella, then showed up to drive the car with the heroin away.
Debriefed by New York police officers and Federal agents several months after his Miami testimony, Mr. Ronsisvalle gave a more detailed account. He said that not only did he see Mr. Catalano meet with Mr. Puma on the street when the car with the heroin arrived, but also that he saw Mr. Catalano then enter the Cafe del Viale on Knickerbocker Avenue and exit with Mr. Tartamella. Mr. Tartamella then drove the car away.
'➺sed on the above, Ronsisvalle concluded that the shipment of heroin was for Catalano,'' the investigator's report stated.
Another report prepared a month earlier said that Mr. Ronsisvalle told of having seen Mr. Catalano meet with another accused heroin trafficker in the pizza case, Giuseppe Ganci, in Mr. Puma's cafe on Knickerbocker Avenue.
In his testimony in the pizza case nearly a year later, in January 1986, Mr. Ronsisvalle repeated the account of having returned from Florida with Mr. Puma in the Porsche, seeing Mr. Puma talk to Mr. Catalano on the street, seeing Mr. Catalano fetch Mr. Tartamella from the Cafe del Viale and seeing Mr. Tartamella drive the heroin-laden car away.
He also testified to having seen Mr. Puma sitting in his restaurant in August of 1977 with Mr. Catalano and Mr. Ganci.
Afterward, Mr. Ronsisvalle testified, he saw Mr. Puma again. ''He say, 'Luigi, do you know the pipe that brings the oil in the United States from Canada? We have the same thing with heroin coming into the United States.' ''
In his affidavit, however, Mr. Ronsisvalle now swears that although he and Mr. Puma did drive to Brooklyn with the heroin, neither Mr. Catalano nor Mr. Tartamella were present.
'ɺll my testimony about Salvatore Catalano and Domenick Tartamella was inaccurate,'' he stated.
As for the ''pipeline'' conversation, Mr. Ronsisvalle said Mr. Puma had made the remark but that Mr. Catalano had not been present. Instead, he said, Mr. Puma had been sitting with a man from the Bronx whom Mr. Ronsisvalle did not recognize.
''I make this affidavit fully aware of the penalties of perjury,'' he concluded. Torn by Guilt, Eager for Cash
According to his own affidavit prepared for the court, Mr. Fisher said it was a person representing Mr. Ronsisvalle who first contacted him on Sept. 16. The man did not leave a name but said that the lawyer could reach Mr. Ronsisvalle at a number he provided at the motel outside Cincinnati.
Mr. Fisher stated in his sworn account that he called the number and left a message and that Mr. Ronsisvalle then quickly returned the call. He said Mr. Ronsisvalle told him he intended to recant his trial testimony against Mr. Catalano. The meeting, in the presence of this reporter and the investigator, Mr. Kelly, took place on Saturday, Sept. 19, in the motel restaurant.
''What are you going to do for me?'' was one of the first things Mr. Ronsisvalle asked the lawyer, even before the tape recorder was running. Mr. Fisher asked how the testimony against Mr. Catalano had come about.
Mr. Ronsisvalle said none of the prosecutors or investigators had planted it. But he said, ''It sound like they washing my brain. They not telling me this is what you got to say, but the way they were talking, it sounds like that's what they would like.'' 'Make a Step Up'
Then he said, ''You still not talking about them goddamn things.'' He rubbed two fingers together in an evident reference to money. 'ɺny time,'' said Mr. Fisher. Mr. Ronsisvalle resumed talking about Mr. Catalano. Then he eyed the tape recorder and halted.
''No, tell him everything,'' Mr. Fisher insisted, referring to the reporter.
''To my knowledge the man is in charge of Knickerbocker Avenue,'' Mr. Ronsisvalle continued. ''I don't want to ruin your tape,'' he said.
''I don't want you to worry about ruining the tape,'' the lawyer responded. Mr. Ronsisvalle then said it was common knowledge on Knickerbocker Avenue that Mr. Catalano ''make a step up'' after the murder of his predecessor, Peter Licata. But he said that while he knew Mr. Catalano as a boss and that that part of his testimony had been true, the heroin aspects were made up.
He depicted himself as haunted by the guilty lie, unable to sleep without drinking excessive amounts of scotch. 'It's Not My Money'
Then he turned to Mr. Fisher and said: ''I don't know but you still don't talk about money. I'm going crazy like I told you.''
''I'm being straight with you, completely straight with you,'' the lawyer replied. ''The money question depends entirely on how much this is worth. I don't mind advising the client to pay you at all.'' That was why, he said, he had invited a reporter - ''no one could ever think you and I had ever had any desire to do anything under the table.''
''So I'm not embarrassed talking about money,'' Mr. Fisher continued. ''It's not my money.'' Mr. Fisher said that when he got back to Mr. Catalano, he expected to be asked, 'How did it go?' ''
Mr. Fisher said he might respond, '' 'Needless to say, the man needs money and he wants money, O.K.' '' Then the lawyer asked Mr. Ronsisvalle, ''What is the first question they're going to ask me?''
''How much he want?'' Mr. Ronsisville said helpfully.
''I don't want to answer that question,'' Mr. Ronsisvalle said, 'use I know you don't know what I'm talking about and I don't know what you're talking about either.'' Reassurances From Fisher
Did the Government double-cross Mr. Ronsisvalle when it needed his testimony? Mr. Fisher asked. It did not, Mr. Ronsisvalle said. ''Guess who needs your testimony?'' the lawyer continued. ''Right here. This guy. Yours truly. I'm not going to screw you. You don't have to worry about my good faith, my integrity, or anything else.''
''You going to give me any money today?'' Mr. Ronsisvalle asked.
''I wasn't intending to,'' Mr. Fisher said. 'ɽo I have to? Can I wait till Monday? I can wire it to you on Monday.'' Quitting the Program
Mr. Ronsisvalle said he did not have the money to pay his hotel bill, normally covered by the Witness Protection Program, which also gave him $30 a day for food and spending money. But he said that several days before he had quit the program in a dispute. He said he had flown to San Francisco to meet with prosecutors and that on the way back he had missed his connection in Chicago. A Marshal, he said, told him there were no accommodations for him in the city and that he should sleep for protection in the Federal courthouse. He said he refused, slept in the airport, and quit the program.
Once before, he said, he was kicked out of the program for two weeks for violating the rules by giving his telephone number to one of his daughters. He said he was allowed to re-apply and was re-accepted. But now, he said, he was out for good. Mr. Fisher said he would pay the hotel bill of $420 and ended up giving him the cash. He also gave him $200 more for expenses and had Mr. Ronsisvalle sign a receipt for the total.
''That's fantastic!'' Mr. Ronsisvalle said. But he said he would also need money to visit his daughters before he faced a possible perjury sentence as the result of his recantation.
The lawyer asked how much he would need.
'ɺ few thousand dollars,'' Mr. Ronsisvalle said. ''Two, three thousand.''
Mr. Fisher said he would consider it but wanted to know if Mr. Ronsisvalle would come to New York for further discussions if he received the money.
''You got to guarantee for my life,'' Mr. Ronsisvalle said. ''I can't guarantee for your life,'' Mr. Fisher said. But he said he could promise that he would keep Mr. Ronsisvalle's whereabouts secret.
Mr. Ronsisvalle said he was no longer worried about Mr. Catalano. 'use once we are having some kind of business, your client don't want me to drop dead now,'' he said.
''You figured that out,'' Mr. Fisher said, adding, ''I never wanted you to drop dead. I just wish you hadn't been a witness.''
Either way, Mr. Ronsisvalle said, he was ''very, very concerned'' for his life. ''I no gonna have no six months' life. I tell you that.'' An Affidavit And $2,000
Three days later, on Sept. 22, Mr. Fisher and this reporter returned to the Ohio motel to see Mr. Ronsisvalle again. Mr. Fisher brought an affidavit he had prepared stating that Mr. Catalano, contrary to earlier sworn testimony, had played no part in the heroin transaction and pipeline conversation.
The lawyer had a Sicilian-speaking associate standing by in his New York office read the statement to Mr. Ronsisvalle in Italian over the telephone. Mr. Ronsisvalle also read it aloud to himself in English.
''I want to be clear here,'' Mr. Fisher said. '𧯯ore you and I said one word about any money you told me you were going to change your testimony about Catalano.''
''Now,'' he continued, ''I have $2,000 in cash. I know youɽ like more. Iɽ like to give you none. Do you know why Iɽ like to give you none? So no one could say you're doing this for the money.''
''Okay,'' Mr. Ronsisvalle said. ''This is not buying me. Like I told you I have to see my daughters.'' Passport to Prison
''I don't think it much matters in which order we do this,'' Mr. Fisher said. ''Signing the affidavit or giving the money. I'll give you the money. I told you I would and I will.''
He handed Mr. Ronsisvalle some folded bills. ''Here's two thousand bucks,'' he said.
Mr. Ronsisvalle signed the statement.
''Why the hell are you doing this?'' Mr. Fisher said at one point, noting that no one but Mr. Ronsisvalle and Mr. Catalano would probably ever know the truth and reminding him that the signed affidavit was most likely a passport straight to prison.
The chief pizza case prosecutor, Mr. Freeh, Mr. Fisher said, ''is going to look at you and go, 'Luigi, go to jail!' ''
He offered to return the signed affidavit to Mr. Ronsisvalle.
''How I got to speak?'' Mr. Ronsisvalle responded disdainfully. ''In Chinese? In Japanese? What kinda language? You understand a man who can't swallow some things? You forget one point in 1979 I give up myself because I can't take no more of that goddamn life?'' ''I didn't forget it,'' Mr. Fisher said. Mr. Ronsisvalle was asked whether he expected to get more than the $2,620.
''Well, I thought my understanding was maybe something else as soon as Mr. Catalano be home,'' he replied. 'ɻut it sounds to me, Mr. Fisher no talk about.''
''You bet your bippy Mr. Fisher no talk about,'' the lawyer said.
''That's the total?'' Mr. Ronsisvalle asked, unsure.
''That's Toto and total,'' the lawyer repeated. ''You mean no more?'' ''Right.'' Mr. Fisher said.
''You no think,'' Mr. Ronsisvalle persisted, ''Mr. Toto Catalano after say thank you, send me a few dollars someplace, buy a pack of cigarettes?''
And then pointed to the date in which it happened, the same day the 'Hollywood Access,' as she said – rather, the Access Hollywood – tape was released to the public through the Washington Post.
Podesta's emails, Clinton said, weren't all that interesting.
'Now, if you read those emails, I think it's a little embarrassing to admit that they are very anodyne, even boring,' said the ex-Democratic nominee.
But the Russians and their allies, 'whoever they turn out to be,' Clinton joked, were able to generate interest, by leading the press on a 'wild goose chase' and creating the 'illusion of transparency.'
From there, the emails were 'weaponized' Clinton said.
'They had to have elements plucked out and perverted in a way that would be hard to imagine and then sent back out into the cyber, virtual world,' she explained. 'So in one of the emails John Podesta is talking about pizza.'
'He's Italian and Greek and you know? And a very good cook,' she said, pointing to the better, more obvious explanation for his conversation. 'His risotto recipe is still there if you want to see it, I'm sure there's something very nefarious about that risotto,' she joked, referencing one particular email from the dump that had previously gone viral.
Clinton then articulated what the conspiracy theory said.
'These evil people in the media world and in the online world out of whole cloth make up this story that John Podesta and I are running a child trafficking ring in the basement of the Comet pizza parlor,' she said. 'By the way, there is no basement.'
'Now you would think people would be laughing like crazy, shaking their heads, but if you migrate that crazy story to Facebook posts, to news outlets, there are people who will believe that, including this very unfortunate man from North Carolina who believed it,' Clinton recalled.
Edgar Maddison Welch, 29, showed up at the restaurant on December 4 with an AR-15 to scope out the scene, firing three times in the restaurant.
When no children were discovered in the non-existent basement he surrendered himself to police. He'll serve four years in prison.
'It was an active crime scene because of people who cared more about weaponizing information,' she said.
So, according to Muscatine, Clinton and her husband quietly bought a lot of pizzas, to show their support for the Northwest D.C. pizza joint.
Muscatine pointed out that Vice President Mike Pence had also briefly lived down the street from her bookstore and from Comet Ping Pong.
'Did he once think of coming in, buying a slice of pizza? Of course not,' Muscatine said. 'But the community has been fantastic.'
5 Accused of Killing 2 Men They Took for DEA Agents
In a major spinoff of the investigation into the slaying of U.S. Drug Enforcement Administration agent Enrique Camarena, an American citizen and four Mexican nationals have been indicted in the 1985 torture-murders of two Americans in Mexico who had been mistaken for narcotics agents, a DEA spokesman said Thursday.
In addition, the sealed indictment, returned Wednesday by a federal grand jury in Los Angeles, names a new individual as a defendant in the Camarena slaying, which took place about a month after the other two murders.
The new defendant is Juan Gilberto Hernandez-Parra, described by DEA officials as “a federal judicial police officer” from Mexico. He is a fugitive believed to be at large in his homeland.
Another individual named in the new indictment, Javier Vasquez-Velasco of Mexico, was arrested without incident in downtown Los Angeles on Thursday afternoon by members of the DEA’s “Operation Leyenda Task Force,” according to agency spokesman Ralph B. Lochridge. The task force was formed to investigate the Camarena murder.
“It’s a major step and a major culmination of the Camarena investigation,” Lochridge said of the naming of defendants in the January, 1985, murders in Guadalajara, Mexico, of John Walker, 38, of St. Paul, Minn., and his friend, Albert Radelat, 32, of Ft. Worth, Tex.
Walker, a Vietnam veteran who had been writing a book about the Mexican Mafia, and Radelat, a college student, apparently were the victims of mistaken identity, according to Mexican investigators.
On the evening of Jan. 30, 1985, they went to a restaurant called La Langosta (The Lobster), which was the scene of a private party hosted by Mexican drug lord Rafael Caro-Quintero and his sidekick, Ernesto Fonseca-Carrillo.
Caro-Quintero and Fonseca-Carrillo, both currently in prison in Mexico on drug-trafficking convictions, were previously indicted on charges of conspiracy to kidnap and kill Camarena. In Wednesday’s indictment, they both also were charged in the murders of Walker and Radelat.
According to Mexican authorities, when the two Americans attempted to leave the restaurant, they were stopped by Caro-Quintero’s bodyguards when someone identified them as “DEA spies.” Both protested to no avail.
Mexican investigators said the two were forced into separate rooms in the restaurant where they were tortured with knives and ice picks for more than an hour. Investigators believed Walker died from the torture and that Radelat was shot to death at a nearby park, where both were buried.
“The killers believed they were DEA agents,” recounted Lochridge. “So we believe the killers felt very macho” when the DEA took no immediate action in the case.
“Since they were not DEA agents, we weren’t immediately aware of their murders,” the DEA spokesman said.
A month later, Camarena, 37, was kidnaped as he left the U.S. Consulate in Guadalajara to meet his wife for lunch. His severely beaten body and that of his pilot, Alfredo Zavala Avelar, were found several weeks later on a remote ranch 70 miles north of that city.
In the new indictment returned Wednesday, five individuals in all were indicted in the murders of Walker and Radelat.
They are: Hernandez-Parra Vasquez-Velasco Caro-Quintero, described by drug investigators as the mastermind of the murder of Camarena Fonseca-Carrillo and Ezequiel Godinez-Cervantes, a U.S. citizen who escaped from Lompoc Federal Penitentiary, where he was serving a prison term on drug charges. He was subsequently captured in Mexico and is in prison term there on a drug trafficking conviction.
Two of the five indicted on Wednesday, Vasquez-Velasco and Godinez-Cervantes, have not been charged in the Camarena murder.
Two other Mexican nationals, Rene Verdugo Urquidez, one of Caro-Quintero’s top lieutenants, and Raul Alvarez-Lopez, a Mexican state police officer, were each sentenced in Los Angeles federal court in October, 1988, to life plus 240 years in prison for their roles in the Camarena murder.
Another Mexican national, Jesus Felix Gutierrez, received a maximum of 10 years when he was sentenced in federal court in Los Angeles in September, 1988, for helping Caro-Quintero flee to Costa Rica in an unsuccessful attempt to avoid prosecution in the Camareno murder.
Yet another defendant, Juan Jose Bernabe-Ramirez, a state police homicide investigator from Guadalajara, is awaiting trial in Los Angeles in the Camarena slaying.
DEA spokesman Lochridge said the Camarena investigation has not concluded.
“We anticipate additional arrests and prosecutions,” he said. “The DEA will not rest until everyone involved is captured and prosecuted.”
Narconomics: The business of drug trafficking
2 of 6 Lt. Gov. Dan Patrick went along for the ride recently on this Department of Public Safety helicopter flying over the Rio Grande during a one-day tour to the border during which Patrick took a look at the improvements the state has made in border security. Marie D. De Jesus/Staff Show More Show Less
3 of 6 In this Oct. 24, 2012 photo, an army convoy patrols near the town of Apatzingan in Michoacan state, Mexico. Knights Templar, a quasi-religious drug cartel that controls the area and most of the state, monitors the movements of the military and police around the clock. The gang's members not only live off methamphetamine and marijuana smuggling and extortion, they maintain country roads, control the local economy and act as private debt collectors for citizens frustrated with the courts, soldiers say. (AP Photo/Alexandre Meneghini) Alexandre Meneghini/STF Show More Show Less
4 of 6 Lt. Gov. Dan Patrick, right, accompanied by the director of the Texas Department of Public Safety, Steven McCraw, uses his phone to capture the moment during a ride on a super shallow waters boat recently acquired by DPS with state funds. Marie D. De Jesus/Staff Show More Show Less
5 of 6 The recapture of Joaquin "El Chapo" Guzman was a coup in the fight against drug cartels. HO/Handout Show More Show Less
The March 9 front-page Chronicle story, "What $800 million bought," told us of the visit to the banks of the Rio Grande by Texas Lt. Gov. Dan Patrick. As Chronicle reporter Mike Ward related, Patrick was there to see firsthand the result of the legislative initiative to beef up border security - an effort he championed. "We're miles ahead of where we were," Patrick told Ward. "And we can expect to have to continue our efforts here, because if we stop, the cartels will come right back in." What if he's wrong about the show of force as a way to combat illicit drug trafficking? And what if the state of Texas, and for that matter, U.S. drug policy, has been wrong-headed all along about our approach to combatting drug cartels?
Journalist Tom Wainwright is addressing the question with his new book, "Narconomics: How to Run a Drug Cartel." The question is implicit and nagging, and as the following excerpt shows, his observations spotlight fallacies in the conventional wisdom that undergirds U.S. drug policy.
One of the most startling successes in the history of the war on drugs took place recently in an office in Austin, Texas. Officials in the state's Department of Public Safety executed an operation that, at a stroke, seized more than $1.6 billion in drugs from organized crime. The operation was notable for its stealthiness. It was carried out without a single shot being fired, or a single person being hurt. In fact, no officers even had to get up from their desks, let alone draw their weapons.
The billion-dollar bust was made when officials decided that instead of calculating the value of the drugs they seized at the border using wholesale prices, they would instead calculate them using much higher retail prices. With a single tweak to a spreadsheet, the value of drugs intercepted in the state shot up from $161 million to $1.8 billion. Conveniently, the tenfold upward revision came just a week before the department was due to hand in a performance review. Whether it is Mexican generals fanning the value of a marijuana bonfire or Texas border agents nudging up the worth of their drug seizures, the people in charge of the war on drugs often seem to demonstrate a selective understanding of economics. It may not be all that surprising that police officers make unreliable economists. But what would happen if economists were given a chance to be police?
The idea isn't as strange as it sounds. In an office block set in parkland in south Wales, a group of statisticians is compiling data on some highly unusual subjects. The analysts, who work for the Office for National Statistics, Britain's official number-cruncher, devote most of their time to recording everyday things such as inflation and unemployment.
But since 2014, as well as measuring the size of the regular economy they have been ordered to measure the economic activity carried out by criminals. So far they have restricted their inquiries to the markets for drugs and sex, using the same accounting model that they apply to legitimate businesses.
There is something strange about reading through the statisticians' methodology. But the sober analysis of crime as business is being used ever more widely, as governments realize that there is something to be learned from looking at organized crime as a profit-making enterprise. Running through this book is evidence that official efforts to tackle the drugs industry have been hampered by four big mistakes.
Mistake One: The obsession with supply
Whereas the relentless focus of the war on drugs is on the supply side of the business - the traffickers - there is an overwhelming case instead for prioritizing the demand side, the consumers.
If the supply side is to be attacked, it should be at the end of the chain, in the rich world, where the product is valuable enough for its confiscation to do some economic damage to those who sell it. There is another reason that focusing on the supply side is misguided, even if it can be made to work. When the price of a product goes up, the amount consumed generally falls. But the size of the fall in consumption varies. Measuring elasticity in drug markets is tricky, because the data on both price and consumption are so hard to verify. But most of the evidence suggests that demand for drugs is inelastic.
The inelasticity of demand for illegal goods and services has two worrying implications for a policy that focuses on supply. First, it means that even big successes in forcing up the cost of drugs (or coyote crossings, for that matter) translate to only small victories in what counts, namely, the number of people buying the drugs (or crossing the border illegally). Second, large increases in price coupled with only small decreases in demand mean that with every enforcement "success," the value of the market increases.
TRIAL IS TOLD DRUG SUSPECT RECEIVED MILLIONS IN CASH
A deposition saying that a major heroin suspect received millions of dollars in cash was presented yesterday in the ''pizza connection'' trial.
The deposition came from testimony in Switzerland by Paul Waridel, a Swiss citizen who admitted collecting more than $11 million for the suspect in Switzerland. He identified the suspect as Yasar Musullulu, a Turkish fugitive accused of supplying morphine base for heroin to Mafia leaders in Sicily.
The deposition from Mr. Waridel, who is being held in Switzerland on related charges, was read to the jury in Federal District Court in Manhattan.
The prosecution contends that the 22 defendants in the trial operated a Mafia heroin ring that laundered many millions of dollars in drug money, including $20 million sent to Switzerland through trading accounts at E. F. Hutton and Merrill Lynch, Pierce, Fenner & Smith.
A prosecutor, Louis J. Freeh, presented testimony and documents to show that the $20 million was transferred from the United States to Switzerland through the brokerage accounts in 1982. The brokerage concerns are not charged with any crime. ɺ Mountain of Money'
Mr. Waridel said in his deposition that he had picked up more than $11 million, most of it in cash, for Mr. Musullulu. He recalled collecting $5 million at one meeting in Lugano, Switzerland, in 1982.
''There was a mountain of money,'' Mr. Waridel said, adding that it was United States currency in stacks of $20's, $50's and $100's that filled six suitcases, which he delivered to Mr. Musullulu's home in Zurich.
When asked if he was personally involved in ''picking up some $11 million of drug money,'' he said, ''Yes.''
''Well,'' he said at another point, ''the money I have seen and transported are 5 million here in Lugano. Once 3 and once 2 million in Zurich, physical money, and once this million and a half dollars in checks.''
The money involved payments to Mr. Musullulu for about 2,200 pounds of morphine base, Mr. Waridel said. ''Surely I knew that morphine base gets converted into heroin,'' he said.
''I have learned,'' he said, ''that Musullulu has relationships with Sicilians and suppliers of morphine base.'' Born in Turkey
The 44-year-old witness, who was born in Turkey and lived in Switzerland for many years, said he had become a confidant of Mr. Musullulu. He said he learned that Mr. Musullulu had received many more millions of dollars for supplying morphine base.
In another deposition earlier in the trial, Franco Della Torre, who is also a suspect arrested in Switzerland, said he had delivered bags of cash to brokerage concerns in Manhattan for men identified by the prosecution as associates of the drug ring.
He said he did not know he was delivering drug money but was told that it was 'ɻlack money'' from restaurants and others who wanted to avoid taxes by moving the money secretly to Switzerland. ''In September 1982, I stopped going to New York to receive money,'' he said, after an official at E. F. Hutton had disclosed that ''the F.B.I. was getting interested in our account in the United States.''
Another witness, Salvatore Amendolito, testified earlier that he had received almost $10 million dollars in cash from two men and had secretly transferred it overseas for them. He said he picked up most of the money from Francesco Castronovo, a defendant who formerly owned the Roma Restaurant in Menlo Park, N.J.
The six-month-old trial - known as the pizza connection because of accusations that the defendants used pizzerias to conceal drug trafficking and money laundering - is to resume today.