The Associated Press

Mob Building Scam Alleged

Suspected Leaders Rounded Up in Manhattan

By John Miller

September 6, 2000

 

NEW YORK, Sept. 6 – Federal prosecutors today announced details of what is being called the largest organized crime bust since the 1980s.

Early this morning, law enforcement officers began rounding up dozens of people, including reputed mob leaders, on allegations that the mob controlled construction contractors and paid off key construction unions.

The U.S. attorney for the Southern District of New York today unsealed a 100-page indictment charging more than 40 alleged members of three crime families with a range of crimes, from bribery to threats.

Authorities say their case is based on thousands of hours of tapes from wiretaps – and on one key informant, a high-level mob associate named Sean Richards, who spoke with ABCNEWS from a secret location.

Investigation

In a three-year effort dubbed "Operation Textbook," federal authorities and New York Police Department organized crimeinvestigators have probed organized crime influence over construction projects around the city.

A common scheme, investigators have said, involved bribing union officials so a company could hire cheaper nonunion workers and forego expensive payments to pension, benefit and health and welfare funds, The New York Times reported in a story on the indictment Monday.

The schemes are said to violate wage laws, which require contractors on public works projects and some large private projects pay workers a set "prevailing" wage, according to the paper.

Prosecutors say mob families, through such activities, were able to claim 5 to 10 percent of billions of dollars pumped into construction projects across the city.

Earlier this year, New York City suspended $80 million in contracts with a construction company over suspicions the company, Interstate Industrial Corp., has ties to organized crime. The company, among other things, was involved in closing a landfill on Staten Island.

Last year, two successive companies hired by the city to supply concrete for the renovation of City Hall Park were fired over similar suspicions.

The indictment described mob influence over the construction of city schools in the Bronx and Queens and projects for the Metropolitan Transportation Authority, the city’s department of transportation.

Violence and Bribery

Richards, who is cooperating with the government, said the mob controls contractors and corrupted bidding on dozens of construction jobs, using bribes and threats, and even getting to union officials.

Richards said part of his mob involvement was coordinating alliances between mob families and doling out bribes to union officials. "Fortunately, most people were greedy enough to take the money," he said.

The investigation revealed evidence that even after mob-controlled unions were cleaned up and put in the hands of federally appointed trustees, the Mafia found its way back in.

"What happens is if you can’t get to the president of the local, you get to a delegate. If you can’t get to a delegate, you get to the shop steward on the job," said Richards. "I corrupted them as easy as feeding the elephants in the zoo peanuts."

Richards said he turned state’s evidence after he became convinced there was a contract on his life because he knew too much.

Twenty-one of the defendants are scheduled to be arraigned in Manhattan criminal courts today.

 

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