Five Families: The Rise, Decline, and Resurgence of America's Most Powerful Mafia Empires (103 page)

In 1986 the glittering, glass-sheathed Jacob K. Javits Convention Center, stretching over five blocks, was completed by the state on Manhattan’s West Side. Named after a U.S. senator, and built at a cost of $486 million, the modernistic, atrium-styled showplace was conceived to bolster the city’s economy. Projected to host eighty topflight industrial trade shows and conventions annually, the facility was seen as a surefire way of creating jobs, aiding the hotel, restaurant, and transportation industries, and generating billions of dollars in sales and hotel-guest taxes for the city and the state.

Unforeseen by its planners were the opportunities the site offered to the Genovese family. From opening day, Chin Gigante’s minions turned the soaring 185-foot-high “Crystal Palace” into a hiring hall for mafiosi and ex-convicts, and a choice arena for pillaging.

The abusive system rested on the borgata’s control of the carpenters’ union, which had a collective-bargaining agreement with the center that gave it the sole right to select one hundred carpenters to work there. These jobs, assembling and disassembling exhibits, were plums, paying the highest union wages, and considered recession-proof. More important, the Genovese family, through its sway over the union’s top command, designated the chief shop steward at the center—the official who assigned carpenters to work there.

A steward’s primary watchdog function is to guarantee that collective-bargaining agreements are fulfilled by employers. Under the Genovese plan, the steward at the center became an essential gear in bullying companies that built and assembled the displays and exhibits used at trade shows and conventions. It was the tried-and-true Mob tactic of threatening slowdowns or work stoppages unless payoffs were made through the steward. The official also had the muscle to overlook union contract violations in exchange for kickbacks. The principal favors given to display-construction companies in return for bribes were: “double breasting,” permitting low-paid, nonunion workers on a job, and “lumping,” paying wages below the hourly rate. These illegal practices enabled companies to avoid fringe-benefit contributions to the union’s pension and welfare funds and added to company profits.

About 50 percent of the take arranged through the stewards was channeled to the Genovese administration. Understandably, the entire “pool list” of carpenters handpicked by the stewards eagerly complied with the corrupt deals.
Most were made men or associates in the borgata and many had criminal records. They somehow were given preference to Javits jobs over 25,000 other union carpenters.

Two of the first shop stewards had little experience as carpenters but nevertheless were approved by the union’s highest officials for the post—with a starting salary of $100,000 a year. One was Ralph Coppola, a soldier in the Genovese family and a convicted arsonist. He was succeeded by Anthony Fiorino, brother-in-law of Liborio “Barney” Bellomo, a Genovese capo who replaced Fat Tony Salerno as the head of the family’s East Harlem and Bronx crews. Fiorino had been a jeweler before being appointed a carpenters’ shop steward. His main claim to fame was having won several professional paddleball tournaments.

As word of the extortion and union problems created by the Genovese gangsters filtered out, trade show and convention business at the Javits Center shriveled during its early years. The Javits management originally had anticipated attracting 5 to 10 percent of the $73 billion spent annually in the nation on major conventions and trade expositions. Instead, it was drawing 2 percent and bleeding red ink, losing about $1 million a year in operational costs.

Besides high-paying and no-show jobs and union shake-downs, there were other money-making opportunities at the center for the Genovese wiseguys. From 1986 to 1991, the value of stolen merchandise and equipment lifted from trade shows and conventions ranged between $500,000 and $1 million annually. Almost any movable item was apt to be stolen. At a trade show for vision products, a sealed package containing 525 artificial eyes was snatched; it was a theft that probably proved difficult to fence. But overall, the Jacob K. Javits Convention Center was a pleasant crime and corruption playground for Chin Gigante’s borgata.

Garbage is always a messy business, and getting rid of it became too expensive for the City of New York. In 1957, to sharply cut costs, the city undertook a radical step: it stopped carting garbage from office buildings, factories, restaurants, hospitals, and all nonresidential enterprises, from the largest elegant department stores to the smallest mom-and-pop candy store. The goal was to reduce the Sanitation Department’s budget by limiting its task to collecting residential trash. All commercial pickups were privatized, handled by companies licensed and regulated by the city. The city naively believed private carters would do the job more efficiently and cheaper than the Sanitation Department.

Within a decade, the Genovese and Gambino families were the ones cleaning up from the changeover. Just as the Luccheses and Gambinos manipulated a trade association and the teamsters’ union to organize a refuse collection cartel on Long Island, the Genoveses teamed up with the Gambinos to duplicate that rich racket in the city’s five boroughs. Domination of Teamsters’ Local 813 and of management groups enabled the families to dictate terms throughout the garbage-hauling industry. Mobsters decided which customers, called “stops,” companies could retain or seek, and the prices they charged.

Conditions for doing business in the city were arranged by two citywide trade and borough associations, run by the Genovese and Gambino families: the Waste Paper Association and the Association of Trade Waste Removers of Greater New York. Any maverick carter who defied the associations’ rulings on carving up routes, selling “stops” to each other, and setting prices would be confronted by teamsters’ union headaches and threats of violence and vandalism to equipment. An illegal but ironclad monopolistic regulation by the associations forbade companies from competing with other members for the same customer. All bids and prices for highly profitable “stops” were rigged.

About three hundred companies operated in the city in the 1980s and ‘90s, removing refuse from 250,000 businesses that paid out over $1 billion in fees annually. Businesses generally had no possibility of lowering costs, and only one choice of a carter—the company that the associations and removers determined was entitled to the “stop.” The corrupt practices created an inefficient crazy-quilt pattern in which, in one instance, a dozen haulers operated on the same block in Midtown Manhattan.

Although New York was the richest prize in the country for carters, powerful national companies stayed away rather than wrestle with the Mafia. Soon after Browning-Ferris Industries, then the nation’s second-largest waste-removal enterprise, dared to begin competing in 1992 for business in the city, it got a crude signal. The company’s New York sales manager awoke one morning to find a dog’s head on his lawn. Stuffed in the animal’s mouth was a note: “Welcome to New York.”

“We knew that was a traditional warning from the Mob not to get involved in New York,” a top Browning-Ferris official, Philip Angell, remarked, vowing that the company would not surrender to Cosa Nostra threats.

Despite press accounts and allegations by investigators that the carting system was violent and sleazy, the city government was unable to overcome the
lobbying and political pressure exerted by the carters’ trade associations against imposing meaningful reform.

Genovese appointees dominated the leadership of the Waste Paper Association, and its offices on Canal Street in downtown Manhattan were a base for Vincent Esposito, Chin’s son by Olympia Esposito, and Vito Palmieri, one of his father’s chauffeurs and bodyguards. The son also was employed by Angelo Ponte, the owner of a large carting company and a popular downtown restaurant, Ponte’s, who was an important member of the carters’ associations.

The versatile Ally Shades Malangone, the feared Genovese capo from the Fulton Fish Market, was also responsible for managing the family’s carting interests. He exercised much of his control through his role as “administrator” of the Kings County Trade Waste Association.

Malangone’s counterpart in the Gambino family was capo Jimmy Brown Failla, a Mafia elder statesman, who, since the late 1950s, was the ranking executive of the Trade Waste Removers association. Every Tuesday, with unfailing punctuality, Failla arrived at noon at the association’s office carrying a supply of succulent Italian pastry. The Tuesday cannoli Hatches were the sit-down days reserved for carters who had problems or sought Failla’s permission to clinch deals and rig bids for “stops.”

Studies by the Rand Corporation, a private research group, and civic organizations in the late 1980s indicated that the two crime families shared a considerable fortune from overcharges. The analyses found that private garbage removal charges in New York were the highest in the country, twice as much as in Chicago, Boston, and Los Angeles. A typical bill for a grocery or a delicatessen ran to $15,000 a year; for a fast-food restaurant, $36,000; and for a medium-sized restaurant, $50,000. Macy’s at Herald Square paid about $500,000, a skyscraper office building, $1 million, and Con Edison, the utility company, $2 million.

With average costs inflated by an estimated 40 percent, the carters, in the 1990s, collected fees every year in the range of $1.5 billion. When investigative auditors finally got a look at the cartel’s books, they found that the Genovese and Gambino families and their main garbage-collector partners raked in a minimum of $600,000 every year in overcharges. And by capitalizing on lax city inspections, Mob-affiliated companies cheated customers of hundreds of thousands of dollars annually by falsifying the weight of rubbish removed from many buildings and stores.

Long before he portrayed the benevolent boss Don Corleone in
The Godfather
, Marlon Brando starred in a different Hollywood story of the Mob. In the 1954 movie
On the Waterfront
, Brando was Terry Malloy, a gruff longshoreman combating union racketeers. The film’s graphic portrayal of mobster treachery, outrageous working conditions, and corruption on the Hoboken piers in New York harbor was part of a groundswell to counteract Mafia influence in the ILA, the International Longshoremen’s Association. A cleanup campaign in the 1950s resulted in the establishment of a bistate Waterfront Commission empowered to regulate and license employees and companies and ban ex-cons with serious records from working on the New York-New Jersey piers.

The Waterfront Commission ended the “shape-up,” a system in which employees did not have steady jobs but had to show up every day and usually fork over part of their wages to an ILA dock boss in order to be hired. Since the 1930s, the Genovese and Gambino borgatas had divided the waterfront loot, which was derived mainly from employee payoffs and from defrauding union welfare and benefit funds. The Gambinos controlled the ILA locals and chicaneries in Brooklyn and Staten Island, and the Genovese domain was the Manhattan and New Jersey piers.

The abolition of the shape-up forced the two families to switch tactics from primarily victimizing workers to taxing stevedoring and shipping businesses in the vast harbor. Containerization revolutionized shipping in the 1960s and made the freight companies easier prey for the Cosa Nostra. Instead of gangs of up to thirty longshoremen unloading “break-bulk” cargo piece by piece, goods stored in huge containers were lifted on and off vessels by cranes. The modernized system concentrated the shipping industry primarily in the ports of Newark and neighboring Elizabeth in New Jersey—an area under the jurisdiction of a Genovese colony, ILA Local 1804-1.

The new cargo-handling system created a demand for dockside companies needed to maintain and repair containers. Soon enough, the Genovese and Gambino borgatas controlled a trade organization, the Metropolitan Marine Maintenance Contractors Association (METRO), representing the two dozen firms that negotiated industry-wide with the ILA. Top administrative posts in the ILA local and in METRO were filled by Genovese lackeys. With the union and METRO in its pocket, the family had the New Jersey side of the harbor in bondage. The repair firms were extorted in exchange for sweetheart union
contracts and to prevent featherbedding, the compulsory hiring of unneeded employees. On the union end, Mob-allied consultants were awarded hefty contracts for advice on investments of hundreds of millions of dollars in members’ benefit funds. Kickbacks for these contracts were laundered for the private benefit of Genovese big shots.