John J. Flood   Bio & Jim McGough (Biography)
6304 N Francisco Av
Chicago. Il 60659
773-878-1002(tel)
 

 

 

1

OFFICE OF THE INDEPENDENT HEARING OFFICER
LABORERS' INTERNATIONAL UNION OF NORTH AMERICA

IN RE:
TRUSTEESHIP PROCEEDINGS No. 97-30T
CHICAGO DISTRICT COUNCIL

TRANSCRIPT OF PROCEEDINGS had in the above-entitled cause at the Midland Hotel, 172 12 West Adams Street, Chicago, Illinois, on the 16th day of July, A.D. 1997, at 9:22 a.m.

BEFORE: MR. PETER F. VAIRA, Hearing Officer

2

PRESENT:
COMEY, BOYD & LUSKIN,
1025 Thomas Jefferson Street, N.W.,
Washington, D.C. 20007-5243), by:
MR. ROBERT M. THOMAS, JR.,
MR. DWIGHT P. BOSTWICK,
appeared on behalf of the GEB Attorney;

CARMELL, CHARONE, WIDMER, MATHEWS & MOSS, LTD.,
225 West Washington Street, Suite 1000,
Chicago, Illinois 60606, by:
MR. SHERMAN CARMELL,
MR. MARTIN P. BARR,
MS. SUZANNE M. LAW,
appeared on behalf of the Chicago
District Council of Laborers;

3

PRESENT: (Cont'd)
EARL L. NEAL & ASSOCIATES,
111 West Washington, Suite 1700,
Chicago, Illinois 60602, by:
MR. GEORGE N. LEIGHTON,
appeared on behalf of
John A. Matassa, Jr.

ALSO PRESENT:
MS. CHERYL MARQUARDT

REPORTED BY: MARY KAY BELCOLORE, CSR, RPR.
CORINNE T. MARUT, CSR, RPR.

THE HEARING OFFICER:
Ladies and gentlemen, let's bring this meeting to order. My name is Peter Vaira. I'm the independent hearing officer from the Laborers' International Union. Sitting beside me is a paralegal from one of the local law firms. I sometimes use, often use a lawyer from my office. But for at least the next couple days, Miss Marquardt will do the, just taking personal notes for me. This is a hearing in the matter of the Chicago District Council. It's a complaint filed by the Laborers' International Union against the District Council under trusteeship pursuant to the Laborers' International Union of North American Constitution. And the law that applies in these areas is well settled in the reported cases in all the labor reporters. We will follow that. Let me just go over some working rules here. We will generally follow the rules of arbitration and the rules of evidence. However, as you know, in those situations, the rules of hearsay are greatly relaxed. What I will generally do is, if evidence is offered, it is permitted to be, permitted to be made part of the record, unless it's so far out that it's ridiculous. But if it has some possible probative value, we will let it come in as part of the record. At the end of the proceeding, I would expect the Council will tell me why or why not some of the evidence does or does not apply or should not be probative. But so we won't go into long arguments over the evidentiary value of some of the items, unless there's a very serious question. I have some persons here -- let me just say this. The rules of our union is that the, are that in trusteeship matters, and other matters that we hear, only the persons who are involved are entitled to come. This is an in-house battle between its members, and no outsiders should be allowed to participate. That doesn't mean you are not free -- I can't stop anyone from talking about it after they leave here. But the doors are closed; only the persons, relevant persons, and the relevant persons here would be the members of this, the delegates to this particular union, District Council. And there are maybe, I think there is a member from the International Union just to observe, and some members of the GEB Attorney's staff. But the reason for that is, this is an in-house affair, and this is the union's problem to settle. And they are going to settle it inside these doors. All right. I have some appearances here; who? The GEB Attorney is represented by whom, sir?

MR. BOSTWICK: Dwight Bostwick and Robert Thomas.
MR. THOMAS: Robert Thomas.

THE HEARING OFFICER: Representing District Council?

MR. CARMELL: Sherman Carmell, Martin P. Barr, Suzanne M. Law.

THE HEARING OFFICER: Okay, thank you.
MR. LEIGHTON: George N. Leighton, representing John Matassa.

THE HEARING OFFICER: I know that I received a call from some other attorneys who may appear for some individuals. And I'm not going to mention their name now. I'll mention them to the other attorneys. They are the attorneys that I know, and have known for a long time, and I believe will sometime during the proceedings appear here. Gentlemen, prior to beginning, we had a lawyers' conference, and we talked about some issues that have come up. Do you want to put that, the gist of our conversation on the record?

MR. BOSTWICK: Certainly, your Honor. This is Dwight Bostwick from the GEB Attorney's office. Our position would be on this issue that they, the individuals who are officers, or delegates, for that matter, of the District Council are not specifically named parties in this action; just the District Council is. If there were individuals or officers who wanted to cross-examine or participate in this hearing, that they should be collaterally estopped on those issues and any future disciplinary matters that are brought against those individuals. If they don't choose to exercise that ability, then they would simply, if charged in a disciplinary hearing, have whatever full rights and protections they have normally, and would be able to cross-examine those people at that time.

THE HEARING OFFICER: MR. CARMELL?

MR. CARMELL: Well, obviously the District Council doesn't take any position on it, except to be pleased that we cleared the issue, as regarding appearance of attorneys, that as MR. BOSTWICK has said, so that that can be relayed, I can relay that to the officers, delegates who may be considering having counsel, and to any counsel that may call me. With that being said, that is the only decision the District Council has.

THE HEARING OFFICER: I gave you a preliminary ruling from me. Because the issues in this case, trusteeship issues, are so fluid, this is almost, almost an investigatory type of a proceeding. It's -- it is not in danger of a disciplinary matter and the issues are going to be fluid and maybe not well-defined. So, to say that someone would be collaterally estopped if they examined, I gave a ruling. If an individual wants to examine a witness on behalf of a person they represent outside of just one or two questions, if they proceed and want to make an examination, there is a presumption, a rebuttable presumption, they may be collaterally estopped at a secondary hearing. But I say a rebuttable presumption because the issues, I don't think they are the same and this is such an informal proceeding and I will treat it that way that I don't want to make a hard-and-fast rule. I do reserve the right, though, to cut that off. If someone proceeds and begins a long, long, long examination, I am just going to cut it off. We will worry about the presumption later. For those persons who don't want to examine or decide that that is not -- they are not estopped. So I am not going to make that hard-and-fast rule.

MR. CARMELL: I thank THE HEARING OFFICER for it because, as you well recognize, being an experienced trial attorney, that the interest of the District Council may at any given time not be in line with a particular officer or delegate. Therefore, the trial decision that the District Council makes to examine or not examine a particular witness should not inure to the detriment of any of the individual officers or delegates. I think with that on the record and your rulings and the GEB attorney's statements, that the officers and delegates are now fully advised of their opportunity to have an independent hearing if and when some other proceeding is filed that involves them.

THE HEARING OFFICER: I think that's fine. Gentlemen, we will proceed. I look back and sometimes the union in these proceedings sets out coffee or something else for people -- for persons to participate. It is a rare occasion when there isn't some coffee. There doesn't seem to be any here today, but maybe sometime in the next few hours we could think about that. I was a hearing officer connected with hearings in Beaumont, Texas. For some reason the union there seemed to think ice water was all we should have, nothing stronger than that. The lawyers' table had ice water as much as you could drink. That was about it. So, sometime along the way we may see if there is some coffee available so the participants can pick up and go back including THE HEARING OFFICER can go back and get some coffee. Gentlemen, let's go.

MR. CARMELL: Preliminary matter, Mr. Hearing Officer.

THE HEARING OFFICER: Yes, sir. You can call me Mr. Vaira. That's fine. This is among lawyers. Go ahead.

MR. CARMELL: All right, Mr. Vaira. The District Council wishes to at this time renew its motion that you recuse yourself and place into the record, in addition to the matters which you have ruled on, which I am not going to repeat that have been ruled on, matters that appeared in the Chicago Sun-Times on Sunday, July 13, 1997, a rather long and involved article which begins with -- about the laborers hearings today. And I'd like to read into the record and go from there this following which appears in the article, quote: "The outcome many labor observers say is a foregone conclusion. The International Union must and will place the Chicago Council under trusteeship to demonstrate its commitment to reform." And there is the following which is even more directly --

THE HEARING OFFICER: MR. CARMELL, who said that? Who is the person being quoted?

MR. CARMELL: It doesn't say.

THE HEARING OFFICER: Oh, okay.

MR. CARMELL: It says, as papers do, many labor observers say. The writer of the article is Tom McNamee. Within this article is the following, and these are quotes: "In another twist,
THE HEARING OFFICER will be Philadelphia attorney Peter F. Vaira who is already on record as saying the laborers union, including the Chicago Council is a, quote, 'captive,' unquote, of organized crime. "As head of the Justice Department's Chicago Strike Force in 1982, Vaira co-wrote the internal memo that spelled out the union's mob ties "But Vaira said Friday that it is common practice for unions attempting to clean house to choose former judges and prosecutors as hearing officers to give the proceedings credibility," end of quote. Mr. Vaira, taken in context of these statements that it's a foregone conclusion and that the only person -- the initial person at least who would reach a conclusion is THE HEARING OFFICER subject to appeal to the Appellate level, sir, together with the statement and the fact that we have not seen the 1980 -- whatever this 1982 Chicago Strike Force memorandum, we would like to have an opportunity to see that so that it could be part of the record if we believe it appropriate because it seems to confirm the testimony that you gave and which is part of the motion to recuse yourself. I want to make it clear that the District Council doesn't quarrel with former prosecutors or even, by God, former defense lawyers from having employment as hearing officers in internal matters. We have former prosecutors who are judges in the District Court, et cetera. It is, Mr. Vaira, the combination of the fact that the Department of Justice at any time, as the hearings show, can rescind the agreement and file a consent decree, in which case the independent hearing officer status is gone. It's replaced by an independent monitor. Together with not just your having been an attorney, but the testimony you gave before the Senate select committee and apparently, and I say that underlined apparently because I haven't seen this memo which says that, according to Mr. McNamee, that the Chicago District Council of laborers is a captive of organized crime, since this is the main thrust of this hearing, as I read it plain, permeates the whole hearing, in our previous hearing conference, telephone conference, I think that became clear. We have a lot more here than your former status and if, nothing else, Mr. Vaira, and I'd like you to consider this, we have some 20 odd locals and thousands and thousands of members who, if the outcome of this is as the Sun-Times writer says will never believe that it was done because the evidence showed it but will believe that it's because it had to be done and that you had already made up your mind. If nothing else, from the appearance of conflict, appearance of bias that goes into the reasonable members' minds, I would suggest to you and request that you reconsider and determine that you will recuse yourself from this hearing.

THE HEARING OFFICER: Thank you. MR. BOSTWICK, any comments?

MR. BOSTWICK: Well, I will make them brief.

THE HEARING OFFICER: Let me just add one. That internal memo that you speak of written in 19 -- maybe '75, I have no copy of. I have not seen it, haven't thought about it for years. It was some sort of white paper. I think management paper that said the Department of Justice, a management tool for manpower, something like that. And whatever it said, I have no idea. I can't recall that. MR. BOSTWICK.
MR. BOSTWICK: Well, I will keep my comments brief. The appearance and the reality of the integrity of the reform process have already been litigated in other forums.

MR. CARMELL knows that well. He was the one that litigated them. We have the stamp of approval of the 7th Circuit Court of Appeals, the District -- Federal District Court here in Chicago as well as Congressional committees in Washington, D.C. after days of hearing. So, I don't take seriously the notion that you are unable to preside over the hearing. I also would have worked a lot less hard on this matter if I had thought it was a foregone conclusion, which I do not. And obviously recusal matters are matters for your determination and I will simply leave it at that. From our side, I have no reason to believe that you are unable to rule on these issues fairly.

THE HEARING OFFICER: As the GEB attorney knows, the GEB attorney has lost a number of decisions before me. As you well know, sir.

MR. BOSTWICK: I myself have lost one.

THE HEARING OFFICER: Gentlemen, I will deny the motion. Let's proceed.

MR. BOSTWICK: Brief opening statement.

THE HEARING OFFICER: Yes. Okay. Feel free to make it wherever you want to make it. If you want to do it there, it's fine.

MR. BOSTWICK: I will feel free to walk around a little bit.

THE HEARING OFFICER: Wherever you are most comfortable. This is a hearing that is meant to get evidence. I want you all to feel comfortable in doing it. Keep it simple decorum.

MR. CARMELL: If we could move that podium, because it does block your exhibits, or replace those, one of the two. I can't see the bottom of that exhibit.

MR. BOSTWICK: This exhibit here.

MR. CARMELL: I'm just saying, I don't mind if the podium is pushed back or whatever, or we don't use the podium, or however. That's fine. Thanks.

OPENING STATEMENT ON BEHALF OF GEB ATTORNEY
MR. BOSTWICK:
Good morning to THE HEARING OFFICER, to the officers and delegates of the District Council, the attorneys for District Council. My name is Dwight Bostwick. As we mentioned, I'm from the GEB Attorney's office. Here to assist me in presentation of this matter for our office is Bob, Robert Thomas. And we have a number of investigators working for the Inspector General's office who will be present at the hearing, and also part of some testimony. And I will, without any further ado, address my comments to you. The leadership of the Chicago District Council is corrupt. Currently, and for the past 25 years, this entity has been filled with mob members, mob associates, and relatives of top mob bosses. We are going to prove this, and I'll tell you how. First we are going to prove the general existence and structure of organized crime in Chicago, which is commonly referred to as the Chicago outfit. We will demonstrate that the leaders of the Chicago District Council have had strong discernible ties to the Chicago outfit for a period of at least 25 years. This first chart, Exhibit 145, is a chart that details in graphics a time line of the general leadership of the Chicago District Council over the past 25 years. It also includes select officials, field representatives and delegates of the Chicago District Council. That's Exhibit 145, for the record. This chart over here is Exhibit 163. This chart is a general depiction of select leaders, crew members, and other individuals in the Chicago outfit, which we will prove through the witness of, through the testimony of a number of witnesses, and through exhibits. This is not all of the Chicago outfit. This is a select portion of the individuals that will be mentioned most at the hearing. These are individuals who have the closest ties to the leadership of the Chicago Laborers' District Council, as set forth in Exhibit 145. The short way of saying this is that this hearing is all about the connections between these two charts. That's our case. You are going to hear from a parade of witnesses who have extensive law enforcement backgrounds. These individuals have worked organized crime activity here in the city for decades. They have surveilled meetings of organized crime figures, listened to tapes and discussions of these crime figures, worked on undercover operations, reviewed police and FBI reports. They have spoken personally to sources and witnesses who are associates of organized crime. Over and over again, these individuals are going to identify the people on these charts as being associated with organized crime. You will also hear from witnesses who are associates in the mob in live testimony. And in prior sworn testimony, you are going to hear these mob associates tell you about their experiences in the mob, and how the mob operates. You are also going to hear them testify about their personal experiences with the individuals on these charts. They are going to provide consistent and compelling testimony about the ties between the leadership of the Chicago District Council and the Chicago outfit over the past 25 years. We are going to prove that the Chicago District Council leaders identified on this chart and in the trusteeship complaint, who owe their allegiance on the one hand to the working members of the union, who bargain collectively for Chicago area locals, and who sit as trustees over pension, health and welfare funds, that have literally hundreds of millions of dollars as assets, actually owe their primary allegiance to the Chicago outfit. Our position and the reason we are bringing this case is because that's unacceptable. Toward the end of the case, we are going to show that the outfit's control and influence over the leadership positions in the Chicago District Council has resulted in numerous specific instances of undemocratic procedures and financial malpractice. Some of the manifestations of this corruption are as follows: The transfers of power without contested election for a period of 25 years in select locals and District Council, uncontested transfers of outfit individuals from official positions in different locals, uncontested selection of leaders who are not qualified to serve as officials, transfer of power from one individual with associations with the outfit to another, the practice of accepting unauthorized dual salaries, aggregating to millions of dollars, and the irresponsible appointment of trustees who preside over the affairs of affiliated funds. But perhaps the most damning evidence that you will hear is the deafening silence of the leaders and delegates of the District Council, as organized crime related arrests, indictments and convictions pile up over the years, as a series of Congressional committees, the President's Commission on Organized Crime, hold hearings and submit reports on organized crime specifically in Chicago, and how this is connected with the District Council and the individuals in the District Council and various affiliated locals, and as the press and the Chicago Crime Commission continue to expose organized crime ties to the Chicago District Council's leadership. The evidence we will present is extraordinary, and will compare favorably to that presented in federal criminal trials. At the close of the hearing, we are going to ask the Independent Hearing Officer to impose a trusteeship on the Laborers' District Council to correct corruption and LCN influence, to correct financial malpractice and to restore Democratic procedures to this institution. But we have a message for the delegates of the Chicago District Council as well through the presentation of this evidence. Let's be frank. You all have a fiduciary duty to your union members to protect and safeguard their jobs and their money. You have a duty to listen to this evidence, and take positive steps and affirmative steps to help eradicate the influence of organized crime in this union. We expect that based upon the hearing of this evidence, you will find it necessary to take action yourselves, and in fact, that is the only way this forum, process is ultimately going to work. That's all I have at this time. We are ready to present our case.

THE HEARING OFFICER: MR. CARMELL, you may if you wish.

MR. CARMELL: I don't wish at this time.

THE HEARING OFFICER: All right, sir. Would you proceed?

MR. BOSTWICK: We will call Mr. Douglas Gow. By way of explanation for THE HEARING OFFICER and the District Council attorneys, we have done the following with respect to the exhibits. We have boxes of exhibits marked with tabs, indicating the numbers of the exhibits. I'm going to ask the witnesses simply to pull those documents as we referred to them, and replace them. But if the GEB Attorney -- I'm sorry, if the Independent Hearing Officer or the District Council attorneys want to review that evidence at the same time, they have the boxes right next to them.

THE HEARING OFFICER: He has a box also?

MR. BOSTWICK: That's correct. They have a

25

box as well. So with that, I'll proceed, if that's, if we're ready.

THE HEARING OFFICER: I think somebody here is able to administer an oath.
(WHEREUPON, the witness was duly sworn.) W. DOUGLAS GOW, called as a witness herein, having been first duly sworn, was examined and testified as follows:

DIRECT EXAMINATION BY MR. BOSTWICK
Q. Sir, could I have your name?
A. W. Douglas Gow.
Q. What is your current occupation?
A. Currently, I'm the Inspector General for the Laborers' International Union.
Q. What is the scope of your duties?
A. In essence, my duties extend to enforcement of the disciplinary and ethics code, and certain violations of the Constitution of the union. The emphasis here is upon eradicating organized crime influence within the union.
Q. Have you had any prior experience in

26

law enforcement?
A. Yes, I have.
Q. What agencies?
A. FBI.
Q. What period of time were you with the FBI?
A. I was with the FBI approximately 30 years.
Q. Could you describe the position you held with the FBI?
A. I held a variety of positions there, beginning with the investigative position, and rose up through the administrative ranks, holding virtually every supervisory job in the FBI. I retired as the associate deputy director.
Q. Did you at one time hold the position of section chief for the criminal section?
A. Yes, I did.
Q. Could you tell me what the duties entail of that job?
A. Well, at the time that I had that position, the criminal section of the criminal investigative division was the largest section within that division. We had responsibility for
27
all undercover operations, a number of criminal violations; not all that the division handled. For instance, I did not have organized crime. I had all violent crimes, property crimes, threats against individuals and so forth.
Q. Are you familiar with the investigative techniques of the FBI through your experience in these various positions?
A. Yes, sir.
HEARING OFFICER: Folks in the back, are you able to hear Mr. Gow? Get a little closer to your microphone.

BY MR. BOSTWICK
Q. What investigative techniques, Mr. Gow, are you applying in your investigative effort to identify LCN corruption within LIUNA?
A. Basically utilizing the investigative techniques that I applied in the FBI. There are limitations in this job. For instance, there are certain things I don't have access to. They are prohibited by law. But our investigations are founded on the rule of law, and with due concern for due process.
28
Q. Have you uncovered evidence of LCN corruption within LIUNA during your tenure as Inspector General?
A. Yes, sir.

MR. CARMELL: I object. That is conclusion. Let him tell the facts.

THE HEARING OFFICER: I'll note the objection. You may answer that question. Go ahead.
BY THE WITNESS:
A. I said yes.

BY MR. BOSTWICK:
Q. Okay. Have you made an effort to determine reasons that the La Cosa Nostra infiltrates the unions like LIUNA?
A. Yes.
Q. Where do you look for answers to those questions?
A. In a variety of places. My contacts extend to former law enforcement, current law enforcement, a variety of commissions that have been held with regard to organized crime, public source information such as newspaper articles, books that have been written on the subject,
29
Congressional commissions and Presidential commissions and their reports.
Q. What are some of the reasons the La Cosa Nostra infiltrates unions such as LIUNA?
A. Basically for financial --

MR. CARMELL: In order not to burden the record, you are going to give the same ruling concerning his testimony to these conclusions, which is exactly what you are supposed to find. How they got in supposedly, whether they got in, I don't want to keep making objections. I don't know.

THE HEARING OFFICER: I will note your objections. The ultimate decision is through me to figure out whether there is -- is organized crime at all and is anywhere in this union, and his conclusions are more of -- I think right now he is going through some sort of historical explanation. I still haven't heard any proof. Whatever he says and if we walked out of here right now, I have heard nothing. I assume that the question about have you found any evidence of it, we'll hear that. If we don't hear it, we
30
don't hear it.

BY MR. BOSTWICK:
Q. Let me show you Exhibit No. 1. Can you get that exhibit from your box there.
A. My eyesight is not quite what it used to be. I have it here.
Q. Prior to taking a look at that, what are some of the reasons that you have uncovered for La Cosa Nostra infiltrating unions such as LIUNA?
A. Again, there is a number of reasons, but I'd say in essence that it's for financial gain. It's both for legitimate and illegitimate purposes, to place people on payrolls, to establish no-show jobs, people, so to speak, on ghost payrolls, but also to have legitimate jobs to exercise discretion and control of contractors in the collective bargaining process and so forth.
Q. What is Exhibit 1 that's before you now?
A. Exhibit 1 is a declaration of Alphonse D'Arco that was given in conjunction with United States vs. the Mason Tenders District Council of
31
New York.

MR. CARMELL: I am going to object to this. He has testified that this is an affidavit. He has not laid any foundation that he knows that this is Alphonse D'Arco's signature, when it was given or anything. This is hearsay upon hearsay.

THE HEARING OFFICER: I understand that. This is an affidavit from a District Court case involving the Mason Tenders. Mason Tenders are technically part of this union, am I correct? It's a large portion of this union up in New York, and I presume this is a civil case that the United States brought against the Mason Tenders to put them in receivership. Am I correct?

MR. BOSTWICK: That's correct. Actually that was going to be the next foundational question addressed to Mr. Gow.

THE HEARING OFFICER: I am glancing over this. As I said earlier, gentlemen, I will generally place all documents that you have before me provisionally into the record. I will wait until the end of the day for someone to tell me why it does or does not apply.
32
I can see this is law division based upon a group of people up in New York. I will admit it, but I am looking for someone to explain to me how it ties into Chicago.

MR. CARMELL: Mr. Vaira, maybe I wasn't articulate.

THE HEARING OFFICER: I understand that.

MR. CARMELL: You have made an assumption that because it says it's a declaration of Alphonse D'Arco with a caption on it that in fact it was a document filed, A, in court and, secondly, that this is Alphonse D'Arco's affidavit. This is not an affidavit that Mr. Gow has identified as being that he knows that is Alphonse D'Arco's signature and his affidavit. That's my objection. You've gotten well beyond just an affidavit of someone who this person can identify. That is a different area that we can get into later.

THE HEARING OFFICER: I understand that. The rules of evidence being as they are in an arbitration, I will expect MR. BOSTWICK to give me

33
some assurances or some proof that this is what it's supposed to be. In the meantime you may proceed.

BY MR. BOSTWICK
Q. Mr. Gow, where did you receive this document?
A. Basically this document and others like it that we received through contacts with the Department of Justice or through access to court records ourselves.
Q. Is this part of the LIUNA Inspector General's working file?
A. Yes.
Q. Are you confident that it is a true and correct copy of declaration prepared for purposes of United States vs. Mason Tenders District Council?
A. I am.

THE HEARING OFFICER: If I went to the District Court in the Eastern -- Southern District of New York and looked up this civil number, could I find this document? I am asking either one of you gentlemen.
THE WITNESS: I can't answer that, Judge,
34
right at this time. A number of these documents with regard to specific individuals I have obtained through contacts with the Department of Justice.

THE HEARING OFFICER: I will look for someone to tell me where this -- the authenticity of this. You may proceed.

MR. BOSTWICK: May you -- your Honor, I had provided to
MR. CARMELL a number of these exhibits in advance of the hearing asking for stipulations to authenticity. I take it that some of them have been stipulated to and some of them have not. In an effort not to slow down the hearing too much, what I propose to MR. CARMELL is that if he is going to raise certain objections as to the authenticity of these documents, we could be subject to recall of various witnesses if necessary for just authentication purposes.

THE HEARING OFFICER: Let me put it this way. I will assume that the documents that you are bringing up to here are good faith and you haven't faked them or taken them out of somewhere. I assume both lawyers for both sides will be doing that.
35
What I would look for as I say at the end is proof that, number one, that it is authentic but then how does it tie into this particular proceeding. So, rather than spend a great deal of time talking about authenticity or so forth, I presume it has some basis in fact someplace. Let's proceed and if you come up later and indicate to me that this is made out of hole cloth, since I am not a jury, I am not going to be overwhelmed by -- overprejudiced by seeing or hearing some information that I can't exclude. Remember at the end of this case it's up to me to decide what is probative and what is not and I have to live or die on what I write. Obviously other persons will look that over. What I am saying is we will proceed, give me the information about this, and I presume it's -- it has some basis. If it does not, I will throw it out.

MR. BOSTWICK: I can give a proffer as to what it's offered to show.

THE HEARING OFFICER: No, go right ahead. That's why I mentioned earlier that
36
trusteeship is a much more fluid evidentiary proceeding. That's why our earlier discussions about the stipulations and the estoppel are important because this is a rather free-flowing type of an evidentiary proceeding.

MR. CARMELL: But, with all due respect, it doesn't flow beyond the bounds of any evidence and there still is a need to authenticate a document and I would agree with -- I have agreed with counsel that one of two things will happen. He will either at a break or whatever establish for me that this is an authentic document that was filed and something that establishes that Mr. D'Arco signed it or he will -- I have no problem with him bringing in a witness out of turn or later to authenticate.

THE HEARING OFFICER: Or someone. Gentlemen, I sat last fall for my 31 total -- 31 days in Buffalo, not in trusteeship, but disciplinary proceeding. We had piles of documents like this and, in fact, after it was over I held some additional telephone hearings to see if we could clear up the validity of some of the documents and I think I eventually threw them

37
out. So there is no guarantee that since we are putting them in doesn't mean that they will stay in. For the sake of moving this along, getting evidence into the record, you may proceed. I will note MR. CARMELL's objections and we will deal with that as we go.

MR. CARMELL: Well, he hasn't offered to admit it at this time. Do I understand that?

THE HEARING OFFICER: I think it's preliminary.

MR. CARMELL: That's what I thought. We haven't come to that.

THE HEARING OFFICER: Put it this way: I will preliminarily admit documents that he presents to me and at the end decide whether or not I should discard them or not, in other words, if there is some question, I will admit them preliminarily.

MR. CARMELL: I do understand that, Mr. Vaira. My point is that I have a right to know what it's being offered for, what purpose is this document being offered for or any other. Is it to prove what? Before it comes in.
38

THE HEARING OFFICER: Let him have a chance.

MR. CARMELL: That's all I am saying.

THE HEARING OFFICER: Let's give him a chance. You don't have to make an offer of proof. Just proceed and I will decide whether or not it stays in.

BY MR. BOSTWICK
Q. Mr. Gow, who is Alphonse D'Arco?
A. Alphonse D'Arco is a made member of the Lucchese organized crime family out of the New York area. He rose from a mere member to the acting boss of the family. He is now in the witness protection program.
Q. Paragraphs 3 through 5 on page 3, does Mr. D'Arco testify in his declaration relating to a general structure and existence of organized crime in the United States?
A. Yes. In there he states that throughout his entire life he was associated with people who were members or either associates of the criminal organization known to him as La Cosa Nostra.
Q. Is this information that he provides in this declaration consistent with interviews your
39

office has conducted with other witnesses?
A. It's -- yes, it's consistent not only with that, but historical information that's been compiled by us and what is known to myself and my investigators.
Q. Could you give a brief overview of the structure of organized crime in the United States?
A. Basically the LCN, La Cosa Nostra, is a nationwide criminal organization that's divided into units, generally called families. Families are in many respects named after the area or the individual that heads that particular family. Each family is headed by a boss who has an underboss and an individual known as a counselor or a consigliere as an adviser. From there, they are divided up into crews, each crew headed by a captain or a capo.
Q. I'm going to refer you to paragraph 10, which I am looking for a page number here.
A. Page 7.
Q. Page 7. What does -- to what does Mr. D'Arco refer in paragraph 10 on page 7?
A. In 10, in paragraph 10 he states, "The LCN tries to control labor unions for a variety of
40
reasons," and then he goes on to state what those reasons are.
Q. Is that information than consistent with the information you have obtained from witness interviews and public reports and the like?
A. Yes, it is.
Q. I ask you to read paragraph 10 for us.
A. Paragraph 10 states that "The LCN tries to control" --

MR. CARMELL: I object. If it's going to be in the record, it's there.

THE HEARING OFFICER: I don't think he needs to read it. I have glanced through paragraph 10. We will certainly note that paragraph 10 is what you --

MR. BOSTWICK: What I have described it as.

THE HEARING OFFICER: And we will look at paragraph 10.

MR. BOSTWICK: That's the purpose of that document. I move for its admission.

THE HEARING OFFICER: Has this fellow, Mr. D'Arco, testified -- I see you mention he is in the witness protection. Has he testified in
41
any of the cases in New York, criminal cases in New York, Mr. Gow?
THE WITNESS: I'd have to check on that. As best I can recall, I believe he did testify in conjunction with the Mason Tenders, but I may be wrong in that.

THE HEARING OFFICER: I am talking about other criminal cases.
THE WITNESS: I am not aware of any others sitting here.

THE HEARING OFFICER: I will be interested in knowing that if you can. I will admit this document, Exhibit 1.
(WHEREUPON, said document, previously marked GEB Attorney Exhibit No. 1, for identification, was offered and received in evidence.)

BY MR. BOSTWICK
Q. I'd like you to refer to Exhibit 2. Do you recognize that document, Mr. Gow?
A. Yes.
Q. What is it?
A. It is a declaration of Salvatore
42
Gravano, better known as Sammy Gravano.
Q. And where was that document obtained?
A. Again, this document is -- was obtained through contact with the Department of Justice sources. It concerns United States bringing a case against the Mason Tenders District Council.
Q. Is this part of the records of the Inspector General's office?
A. Yes, it is.
Q. As of the time you collected this document did you assure yourself that this was a true and correct copy of the declaration prepared for purposes of United States vs. the Mason Tenders District Counsel?
A. I had no reason to question that based on the sources that I obtained it from.
Q. Could you tell me the date on the back of the last page?
A. The date on the back is, he executed it on October 17th, 1994.
Q. Who was or is Salvatore Gravano?
A. He again was a member of organized crime and a member of the Gambino family. He rose from a member to the underboss of the family,
43
until he entered into the witness protection program.
Q. Let me refer you to section C of this declaration, Page 5, paragraphs 11 and 12. What do those items refer to?
A. Well, paragraph C is entitled Organized Control Over Labor Unions. In paragraph 11, through 12, he details the Gambinos' actions, or likes to control unions. Well, he states, the Gambino family likes to control the unions of unskilled workers such as Mason Tenders, because there is no apprenticeship or special training requirements to become a member in such unions. As a result, members and associates of the Gambino family could be placed easily into the Mason Tenders' jobs, even though they generally lacked training or experience in the more skilled forms of construction work. He goes on to state, the LCN likes to have control and influence over labor unions, because such control provides organized crime with a power base. He says, through control over labor unions, the LCN --

MR. CARMELL: Mr. Vaira --
44

THE HEARING OFFICER: Go ahead.

MR. CARMELL: He is reading. Let's stop the reading. If he wants to tell us what he knows, not what this document says --

THE HEARING OFFICER: He may read it. It's only a couple paragraphs. And let him put his case in. You may continue to read, sir, or paraphrase as you are going.
BY THE WITNESS:
A. What he is doing is detailing of why organized crime likes to control labor unions. Again, it gets into the fact that they can exert power and influence over a contractor by controlling certain aspects of it. They can infiltrate legitimate businesses by influencing bids for contracts, etcetera, and this is what he lays out.

BY MR. BOSTWICK:
Q. Let's back up and make this clear. The Mason Tenders District Council is a part of LIUNA, is that correct?
A. That's correct.
Q. And it is a District Council in New York, correct?

45
A. Yes.
Q. And these two declarations, Exhibit 1 and Exhibit 2, relates to Chicago, to -- I'm sorry, to an individual in the La Cosa Nostra, describing why it is that the La Cosa Nostra has an interest in controlling labor unions?
A. Yes.
MR. CARMELL: That's not quite a fair statement. It is, the Genovese family or Gambino family, as the case may be, has an interest in it. And so the document says what it says. But I don't believe that's a fair characterization.

THE HEARING OFFICER: The document, you're right,
MR. CARMELL, says what it says. I think the gist of it is they are talking about unskilled labor unions, where there is no apprenticeships, giving the reason why --

MR. CARMELL: But within the framework of the families, to which these affiants have affirmed. That is what I'm saying.

THE HEARING OFFICER: That's correct. Remember, I asked earlier, this is two New Yorkers talking about a Brooklyn, a Brooklyn local or Brooklyn District Council.
46

Am I correct, MR. BOSTWICK? The Mason Tenders District Council has been placed in court receivership, am I right, sir?

MR. BOSTWICK: That's correct.

THE HEARING OFFICER: And that's, that number, the case is 94 CIV 6487. That's out of New York. That has to do with this court case. And in fact, they are right now under trusteeship, right?

MR. BOSTWICK: That's correct.

THE HEARING OFFICER: When I say "they," I mean "it" is under trusteeship, okay.

MR. BOSTWICK: That's correct. And I don't want to engage in discussing every piece of evidence and its meaning as we go along. But I do think there was a misstatement there that these relate totally to these families. Paragraph 12 of the exhibit we are looking at right now says the LCN likes to have control and influence over the labor unions.

THE HEARING OFFICER: I assume that you are offering that, as indicated, as sort of a generic philosophy, why organized crime would like to or
47
it leads to influence certain locals or certain industries.

MR. BOSTWICK: Precisely.
BY MR. BOSTWICK
Q. Mr. Gow, is testimony provided by Mr. Gravano in these paragraphs of the declaration consistent with other testimony and information you have obtained regarding the motivation behind the LCN's infiltration of LIUNA?
A. Again, yes.

MR. BOSTWICK: I move for admission of Exhibit 2.

THE HEARING OFFICER: Admitted.
(WHEREUPON, said document, previously marked GEB Attorney Exhibit No. 2 for identification was offered and received in evidence as GEB Attorney Exhibit No. 2.)

MR. CARMELL: Same objection as --

THE HEARING OFFICER: Gentlemen, I give you some advice. There is a fair sized body of law on this subject matter, associations and organized crime, in the Southern District of New York, and
48
also in the Seventh Circuit, in the Teamsters, United States versus International Brotherhood of Teamsters. And there have been a number of cases, many, maybe 100 cases involving these issues, organized crime relationship, the type of evidence that is admissible. And I direct your attention to that. That is, it is not controlling here, but it is persuasive because it has gone through the court system. And you have both Judge Elstner and the Seventh Circuit writing on the subject.
BY MR. BOSTWICK
Q. Mr. Gow, as part of your efforts as the Inspector General of LIUNA, have you undertaken an investigation of the Chicago District Council?
A. Yes, I have.
Q. Certain officers of the Chicago District Council?
A. That's correct.
Q. Select affiliated locals of the Chicago District Council?
A. That's correct.
Q. How many locals are affiliated under
49
the umbrella of the Chicago District Council?
A. 21.
Q. How many of these affiliated locals have been targeted for investigation by the Inspector General's office?
A. Approximately seven, and the District Council, including.
Q. Which affiliated locals have been targeted?
A. Local 1, 2, 5, 225, 1001, 1006, 1002. And I have to explain, 1002 is no longer chartered. But at the period of time we were looking at it, and at the officers, and there is many, so to speak, carryover, local 8 was involved in that, while it's not part of the District Council, it was part of our investigation.
Q. What role does the Chicago District Council play with respect to the affiliated locals?
A. Well, Chicago District Council plays same role as any District Council plays, in regard to its affiliates. It is a central coordinating body for the affiliated locals. As such, it is

50
affiliate of the International Union. District Councils come into being basically in two ways. A group of locals get together and decide that it's in their best interests to harness their political power and strength and make application to the International to form the District Council. Or the international on its own initiative can decide it would be best to have a District Council in a particular area in particular circumstances, and press forward to form a District Council.
Q. How many union members are under the jurisdiction of the District Council and its affiliated locals?
A. The most current count that I can get through the per capita tax division in LIUNA headquarters was 19,243.
Q. How many union members -- excuse me, is this the total of the membership of the 21 locals?
A. Yes. That's the total membership of the 21 locals.
Q. Does the Chicago District Council play any role over the funds or the affiliated funds of
51
the District Council?
A. Yes.
Q. What role is that?
A. The role is that the District Council is the body that elects the labor side trustees, you know, to handle these funds.
Q. Are there a number of funds affiliated with the Chicago District Council?
A. Yes, pension, health, welfare and so on.
Q. As an example, how much money is in the pension fund? Have you undertaken to determine that?
A. I believe the latest figures that I have based on government records is over 900 million.

THE HEARING OFFICER: Does that mean that the, so the individual locals, the 21 have no, no funds of their own, no funds that they control? It's all in the District Council?
THE WITNESS: To my knowledge, that's correct.

THE HEARING OFFICER: That would be pension, health?
52
THE WITNESS: Health, welfare, and several others.

THE HEARING OFFICER: Several others? Training fund?
THE WITNESS: There's a training fund too.
BY MR. BOSTWICK
Q. Back to the makeup of the Chicago District Council, who makes up the actual membership of the Chicago District Council?
A. Delegates that are elected from the individual locals. The number of delegates is based on the representative size of the locals, and it ranges from two to seven. I think 500, a local with 500 or less can have two delegates a local, the highest number being seven delegates.
Q. How are these delegates selected, according to Constitution?
A. In accordance with LIUNA Constitution. They have to meet the standards that are set forth for the normal elections.
Q. Are the Chicago District Council and affiliated locals required to memorialize position and salary of officers on certain documents?
53
A. Yes. Federal law requires they do this on LM2s, and also by the Constitution, that they have to utilize, memorialize this in the form of minutes, which have to be kept for a certain period of time.
Q. During the course of the Inspector General's investigation of the Chicago District Council, and the affiliated locals that you have just mentioned, had your office made efforts to collect records, to establish the current and historical leadership of these entities?
A. Yes, we have.
Q. Which documents are those?
A. Both LM2s and minutes, and also documents such as the 5500s.
Q. How far back did you get the LM2s?
A. To I believe 1970.
Q. Where did you get them?
A. From the Department of Labor.

THE HEARING OFFICER: That is a public document, right? What is 5500?
THE WITNESS: That has to do with the funds.

THE HEARING OFFICER: That is --
THE WITNESS: IRS form.
54

THE HEARING OFFICER: That is similar to LM2, but for the pension fund, right?
THE WITNESS: (Indicating.)
BY MR. BOSTWICK
Q. Mr. Gow, I've only brought one copy of these, because they are rather bulky. I'll certainly give Mr. Carmell an opportunity to take a look at these. But you have exhibit behind you, Exhibits 118 through 125. I'd like to just have you tell us what those are.
A. These are a compilation of the LM2s, I'm looking at Exhibit 118, which goes through the year 1970 to 1980 -- 1995.
Q. And again, I only brought one copy of these, because they are extremely bulky. Are these the LM2s that you received from the Department of Labor?
A. Well, I did not see, you know, each and every one that came from Labor. We made the application to the Department of Labor. They were certified and authenticated by the Department of Labor. The clerk in my office handled this. And we forwarded them to your office.
55

THE HEARING OFFICER: What years are these, gentlemen?
THE WITNESS: 1970 to 1995.

BY MR. BOSTWICK
Q. And that is for each of the affiliated locals that you have mentioned?
A. Yes.
Q. Which locals are those again?
A. Local 1.
MR. CARMELL: Can we identify them by exhibit number, which is Local 1?
BY MR. BOSTWICK
Q. Why don't you start and do that with 118.
A. Okay, 118.
MR. BOSTWICK: Your Honor --

MR. CARMELL: I'm all right. I see them on the list. He gave me a list, so --

THE HEARING OFFICER: Okay, fine.
BY THE WITNESS:
A. You want me to go through each one?
BY MR. BOSTWICK
Q. No. Is there an authentication in the front of each one of those binders from the
56
Department of Labor?
A. Yes. So for instance, I hereby certify, and then it's signed by authentication officer, Department of Justice.

MR. BOSTWICK: Mr. Vaira, what I would propose at this time is that we can provide at a break MR. CARMELL and his associates to take a look at these. I don't think there is, I don't anticipate any problem with the authentication of these documents.

THE HEARING OFFICER: I assume they are authentic, at least for that purpose, you can move on. So these are all the LM2s for every local, or just the seven under investigation?
THE WITNESS: For those under investigation.

THE HEARING OFFICER: That would be seven locals.
BY MR. BOSTWICK
Q. As well as the District Council?
A. District Council.
MR. BOSTWICK: I'd move those be admitted.

THE HEARING OFFICER: Okay. They are admitted. (WHEREUPON, said documents,
57
previously marked GEB Attorney Exhibit Nos. 118 through 125, for identification, was offered and received in evidence as GEB Attorney Exhibits Nos. 118 through 125.)
BY MR. BOSTWICK
Q. Can you pull Exhibits 145 and 152, Mr. Gow, pull them right out of the box? Why don't we go over, very briefly, each one. What is 145?
A. 145 is what is depicted up here, is the chart of the District Council.
Q. That is this chart right here against the wall?
A. That chart right there, showing the, so to speak, executive positions from 1970 through 1995. The remainder -- yeah, I'm sorry, that is exactly --
Q. Now, where did you, how is it that this graphic representation of the leadership in the Chicago District Council was made?
A. This is compiled basically through review of the LM2s that pertain to the District Council; also pulling of the officer blanks at the records section at LIUNA.
58
Q. Were the minutes also minutes of the Chicago District Council?
A. Minutes were also reviewed.

MR. BOSTWICK: I would move admission of 145.

MR. CARMELL: I need voir dire on this, Mr. Vaira. You will see why if I get to ask a couple questions.

THE HEARING OFFICER: Okay. It seems, from what I understand, it is a purely a graphic, a graphic demonstration of what the, who has held office, am I correct?

MR. BOSTWICK: That's correct. Federal rule of evidence 1006 would be directly on point on this, in federal proceedings; it's simply a summary.

MR. CARMELL: Can I have a moment?

THE HEARING OFFICER: I'll give you a moment. Go ahead.
MR. CARMELL: You have on the bottom there of that exhibit select officials, field representatives, or delegates. I think that they should discern which is which on there, those that are employees or delegates. It's delegates, Mr. Vaira, that come from the local union. Those are
59
all lumped together. There is no discernment. If he can't, I can discern with him who is who.

THE HEARING OFFICER: I understand what you are saying. Right now, this is a piece of demonstrative, purely a chart to guide us as we go. If we are incorrect, you know, we will find that out. I take it, Mr. Bostwick, at the bottom, you put different names; some of these folks may be field reps, some may be delegates, some may be some other officials of local unions, am I correct?

MR. BOSTWICK: Of the Chicago, of the Laborers' District Council on this chart, and then on the other charts of locals; this Exhibit 145 is specifically the Laborers' District Council.

THE HEARING OFFICER: Okay.
MR. CARMELL: Don't you want to know -- Mr. Vaira, we know from Mr. Gow that a delegate is elected from the local union and the District Council takes the delegate as they come.

THE HEARING OFFICER: That's right.
MR. CARMELL: Wouldn't you want to know which
60
of those persons on there was an employee of the District Council as opposed to being a -- just a delegate who the District Council takes?

THE HEARING OFFICER: Let's do this. The top within the lines are the officers. Below the line is a group of names and it's going to be one of the two. They are going to be a delegate, they are going to be a field rep or some other official. I am not so sure what other official they would be. When this becomes relevant, you gentlemen will tell me. You take a pencil and put a sign after each one. Until that happens, it's not very probative. So, I will let it stand and you can go on and when something, for example -- if someone wants to talk about Frank Demonte, you can take your little pencil and whatever Frank was, field rep or whatever.

MR. BOSTWICK: We can certainly provide that over the course of the testimony. In response to Mr. Carmell's concern, one of the things I would state is that the members of the District Council are the delegates. So, it's not -- it's not irrelevant to
61
they are on a chart relating to the District Council. It's not as though we are picking and choosing people from locals for no reason. There is a position that they hold in the Chicago District Council and we would certainly, as we go along, part of our proof will be what positions they specifically hold. For the purposes of this chart -- actually I have another chart that shows these people's exact positions.

THE HEARING OFFICER: Okay.

MR. BOSTWICK: Both in the locals and in the District Council and their salaries.

THE HEARING OFFICER: All right. Right now it's neither here nor there, their connection to the District Council in some fashion. If it becomes extremely relevant to find out, I am just using Demonte just as an example, if you want to -- if it is going to become extremely relevant, we will find out what he does. Okay.
BY MR. BOSTWICK
Q. Mr. Gow, why don't you just briefly and quickly go through each one of the exhibits and
62
simply tell us which of those exhibits relate to which locals, which affiliated locals. In other words, Exhibit 146.
A. Oh, okay.
Q. It's going to be 146 through 152 and as you are reaching for it perhaps I can ask you a question to move things along. Are each one of those additional exhibits, Exhibits 146 through 152, prepared in the same manner that the Chicago Laborers District Council chart was prepared?
A. Yes.
Q. You will have to give a verbal response.
A. I said yes. Exhibit 146 relates to Local Union 1. Again, it's a chart that is similar to that. Exhibit 147 relates to Local Union 2; 148, Local Union 5; 149 to Local Union 225; Exhibit 150 to Local Union 1001 and 151 to Local Union 1002.
Q. How about 152? I think there is one more.
A. One more here. Exhibit 152 relates to Local Union 1006.
63

MR. BOSTWICK: I'd move for admission of 145 through 152 at this time.

THE HEARING OFFICER: I will admit them. (WHEREUPON, said documents, previously marked GEB Attorney Exhibit Nos. 145 through 152, for identification, were offered and received in evidence.)
BY MR. BOSTWICK
Q. Mr. Gow, let me take you back to the beginning of your investigations of the Chicago District Council. What day did you begin as the LIUNA Inspector General?
A. My first day was February 1, 1995.
Q. How soon after this did you begin to focus on LCN corruption in the Chicago District Council and select affiliated locals?
A. By March of '95.
Q. So, that's a month, approximately?
A. Approximately a month.
Q. A month. How high a priority was that for you at that time?
A. Oh, at that time it was our number one priority with regard to organized crime matters.
64
Q. Has it continued to be a priority since then?
A. Yes, it has.
Q. What are the reasons you targeted the Chicago District Council and certain affiliate locals for investigation?
A. Well, in looking at a number of documents, talking to law enforcement sources, contact with the individuals that I hired to work in this area, all indicated that this was a -- there was a problem here. There was infiltration by organized crime into the affiliates and the District Council.
Q. Did you at some point in time receive a complaint, draft civil RICO Complaint from the Department of Justice?
A. Yes. I had a copy of the draft civil RICO Complaint.
Q. Did that document identify certain individuals from the Chicago area that the Government believed were involved in the La Cosa Nostra?
A. Yes, it did.

THE HEARING OFFICER: I don't need to know
65
what the Government thought about it or what sort of probable cause you have. You're here. So, I don't need to hear that unless it's particularly relevant to what all the United States Government thought about this. Our proof is what our proof is. You don't have to convince me that you had to get here. You're here. So you can go on.

MR. BOSTWICK: Okay.
BY MR. BOSTWICK
Q. Did you review at any point in time Congressional committee reports relating to organized crime in Chicago?
A. Yes.
Q. Let me refer you to Exhibit No. 5, which is a white binder. I ask you to look at the first page behind the first tab. Do you recognize this document?
A. Yes, I do.
Q. What is this document?
A. It's entitled "Organized Crime in Chicago." It's a hearing before the Permanent Subcommittee on Investigations of the Committee on Governmental Affairs, United States Senate. It's
66
dated March 4, 1983.
Q. Is this the full report of these hearings?
A. I'm not exactly -- I don't know what you have here.
Q. Okay. Are these not selections of this --
A. It looks to me like they are selections from the committee's report.
Q. Are the selections -- do you know what purpose the selections have been made?
A. Well, it's pretty evident. The selections that you have here are based on law enforcement sources that served in this area and had an intimate knowledge of organized crime activities in the Chicago area.
MR. BOSTWICK: Your Honor, or Mr. Vaira, what I would propose to do on this document is not go through it ad nauseam. It is a public record that was available to the members and officials of the District Council at this time. I would like to highlight a few items that specifically relate to the individuals on this chart through Mr. Gow.
67

THE HEARING OFFICER: Yes, I understand that. You may do that. Understanding that as you go, this type of evidence is -- has been admitted in -- by Judge Lacey in New York on the basis of that it needs corroboration from other sources. So, if there is somebody up in front of Congress talking about somebody being connected to the mob, that doesn't make it so. That means that it's some evidence that some persons have said that. We will look for other corroborating evidence also. So, with that understanding you may go forward.

MR. BOSTWICK: That's correct. The other reason to offer this is from the notice perspective.

THE HEARING OFFICER: I understand that. That has been done a number of times in the Teamsters litigation for notice purpose. I notice this is the -- this is the old McClellan committee, is that it? Permanent Subcommittee on Investigations. Okay. That was -- at that time it was Senator Percy I think was on this, was
he?
68
THE WITNESS: You're correct.

THE HEARING OFFICER: Senator Nunn. Those are the two ranking Senators. For a long time were stalwarts on that committee. Go ahead.

BY MR. BOSTWICK
Q. Mr. Gow, just to clarify what it is we are talking about here, let me ask you to turn to the -- I guess it appears as the fourth page back from the first tab. Actually marked as page 1 at the bottom. Do you see that page? It says "Organized Crime in Chicago" at the start. It's the beginning of the hearing. You just go four pages back from tab one. Opening statement, Senator Roth. Do you see that?
A. Yes.
Q. Just in the second paragraph under the opening paragraph of Senator Roth. Could you simply read that. That just defines the scope of this specific committee so we know what we are talking about here.
A. All right. I think I can summarize it very briefly. He states: "The scope of activities involving the syndicate or the mob or the outfit in
69
Chicago is truly pervasive. Organized crime in Chicago touches practically everyone's life or livelihood. The evidence shows that tentacles of mob activity in this city reach into Government, law enforcement, unions and other legitimate political, social and economic functions."
Q. Were these hearings public?
A. Yes.
Q. Were the reports made publicly available?
A. To my knowledge, yes.
Q. Let me have you turn to the second tab and ask you to identify what that is.
A. Second tab is prepared statement of Edward D. Hegarty. Mr. Hegarty was a special agent in charge of the FBI Chicago division at the time. He has since retired.
Q. Does Mr. Hegarty in this prepared statement review and identify the structure of organized crime in Chicago?
A. He does.
Q. Let me just turn you to page 114, have you read just the bracketed portion if you will.
70
A. Mr. Hegarty states: "The Chicago LCN family continues today, as it has throughout its history, to obtain lucrative income from traditional racketeering and vice activities. These include but are not limited to loansharking, extortion, gambling, prostitution and labor racketeering. "With respect to labor racketeering, many of the activities and members of the Chicago LCN member are given cover by unions, thus providing a degree of respect and legitimacy. It takes four vital components to make up a full grown labor racket, i.e., dishonest labor leaders, unscrupulous employees, crooked public figures and professional criminals. The Chicago LCN has long recognized the advantages of controlling the unions. During Al "Scarface" Capone's regime nearly two-thirds of all the unions were under his domination. To a degree the Chicago LCN continues to maintain this grip on organized labor. The ultimate result has been in many
71
instances an amalgam of hoodlums, corrupt unions and corrupt public officials formed into an enormous power base. Not only does this generate significant income for organized crime, but equally as important provides a high degree of insulation against prosecutive interference."
Q. Mr. Gow, on page 119 -- let me refer you to 119 through 121. I am not going to have you read that. But is a specific investigation and indictment referred to on those pages?
A. Yes. It's a case that included conspiracy to bribe a U.S. Senator against Alan N. Dorfman, Roy Lee Williams and others.
Q. On page 121 are any individuals of the District Council identified --
A. Yes.
Q. -- as having been convicted of that activity?
A. Yes. Two individuals, James Caporale and Alfred Pilotto.
Q. I am going to mark these on the chart as you go.

MR. CARMELL: I think that is a misreading of
72
what the case was. The bribing of a U.S. Senator is not a LIUNA case, does not involve Caporale, as I read it.

THE HEARING OFFICER: I am familiar with that case. I was not here then, but I -- was Caporale in that case?

MR. CARMELL: No.
THE WITNESS: It was the Hauser case.
BY MR. BOSTWICK
Q. Could you describe in brief detail what that case was about. We are going to hear evidence that is more extensive about this subject matter.

THE HEARING OFFICER: What case are we talking about? Which one are we talking about?
THE WITNESS: Now we are talking about the Hauser conspiracy. It was -- had to do with kickbacks to obtain health care and life insurance franchises in Chicago and south Florida.

THE HEARING OFFICER: Okay.

MR. CARMELL: Excuse me. Is that the one that starts on the bottom,
MR. BOSTWICK, September of 1976? Which begins on the bottom of page 119.

MR. BOSTWICK: That's correct.
73
MR. CARMELL: Okay.
MR. BOSTWICK: On the bottom of 119 and through the end of 122 actually I guess. Or 123
BY MR. BOSTWICK
Q. Does this case specifically relate to a fraud on the affiliated funds of the Chicago District Council?
A. Yes, it does.
Q. Can you tell me from page 121 who -- the two individuals that are bracketed who received convictions in this matter?
A. The two individuals noted here are James -- as I said, James Caporale, who was the secretary-treasurer, of the District Council I believe at the time, and Alfred J. Pilotto, who is president of Local 5 and vice president of the District Council. This is special international rep to the international union.

THE HEARING OFFICER: Am I correct, gentlemen, the case you are talking about then started when there was a search warrant executed on the consultants and administrators, which was the group that administered the pension funds or the funds of the District Council or some LIUNA
74
entity, right?

MR. BOSTWICK: They had contracts with the Chicago District Council. We will hear more detailed evidence on the substance of this case. For the purposes now, I simply want to establish, as I believe through Mr. Gow, that the -- these two individuals who are officers of the Chicago District Council were convicted of fraud on funds that were affiliated with the Chicago District Council.

THE HEARING OFFICER: But that case occurred in Florida, am I correct?
THE WITNESS: Yes.

MR. BOSTWICK: Tried.

THE HEARING OFFICER: The case was tried in Florida. Some of the funds were up here in Chicago and then that case -- the investigation continued and later on a whole slew of individuals were tried down in I think Florida. At least these two, Caporale and Pilotto, were convicted.

MR. BOSTWICK: That's correct.

THE HEARING OFFICER: That is the connection. Now, that is not the case that you referred to when you first opened this.
75
THE WITNESS: No.

THE HEARING OFFICER: Of --
THE WITNESS: Dorfman.

THE HEARING OFFICER: Dorfman case.

MR. BOSTWICK: That's correct. I mistook Mr. Gow. I think we were reading from the wrong page.

THE HEARING OFFICER: Dorfman case was --

MR. BOSTWICK: Different.

THE HEARING OFFICER: -- A Teamster matter. It was much more involved. I think it was tried here in Chicago some other time. Just so we don't get confused about that. I am not confused about it. I understand the difference and I am not associating this with the Dorfman case at all.

THE HEARING OFFICER: Okay. Go ahead.
BY MR. BOSTWICK
Q. On page -- why don't you go back to the or the first page of the next tab, a statement by Roemer.
A. Yes.
Q. Page 157?
A. Right.
Q. Who is William Roemer?
76
A. William F. Roemer, Jr. was a special agent with the FBI. He was assigned to the Chicago division for a number of years and worked on specialized organized crime matters, subsequently transferred to the Phoenix division and worked for me down there when I was assistant in charge of that office. He has since passed away.
Q. Is it fair to say -- I don't want you to refer to this in its entirety, but is it fair to characterize this testimony as an overview of the history of organized crime in Chicago and the current state of organized crime in Chicago as understood by Mr. Roemer?
A. That's correct. He has two sections to his prepared statement and they are as you've said.
Q. There is one last tab in this exhibit.

THE HEARING OFFICER: Is there anything in particular that you would like us to look at in Roemer's statement or is it just there for background?

MR. BOSTWICK: I have -- as part of -- let me do this by asking him a question.
77

THE HEARING OFFICER: Okay. You may lead. You may direct him to something. Don't feel constrained.

BY MR. BOSTWICK:
Q. Mr. Gow, is the entire prepared statement by Mr. Roemer relevant to establishing who outfit members are in Chicago during the early 1980s?
A. Yes, it is.
Q. Does Mr. Roemer set forth these individuals in a chart form?
A. Yes, he does.
Q. And that's on page 186 of his prepared statement?
A. That's correct.
Q. We were unable to get a very good copy of this chart, but we did try to blow it up a little bit and it appears in the back of the binder behind the tab labeled "Chart." Do you see that?
A. Yes.
Q. Do you see that? Let's go to the second page of that and this is again a graphic representation of
78
Mr. Roemer's testimony or his prepared statement to the committee?
A. Yes.
Q. Do you see the highlighted individuals?
A. I do.
Q. Could you read off -- well, first, do any of those individuals have connections with the Chicago District Council?
A. Several of them do.
Q. Could you read off the highlighted individuals.
A. As best I can. Vincent Solano, Frank Caruso.
Q. A little slower, please.
A. Vincent A. Solano.
Q. Right.
A. Frank Caruso.
Q. Okay.
A. Dominick Palermo.
Q. All right.
A. Frank DeMania. Am I reading that correct?
Q. DeMonte?
A. DeMonte.
79

THE HEARING OFFICER: You have trouble with Italian names, Mr. Gow.
THE WITNESS: I do.

MR. BOSTWICK: It's also a function of this chart. It was very difficult to make a copy of this chart.

THE HEARING OFFICER: Okay.

BY MR. BOSTWICK
Q. Do you see the other individual there, Sal Gruttadauro?
A. Yes.
Q. Is it fair to say that as of 1983 these individuals that I have circled up here on Exhibit 145, these are individuals that were identified in the 1983 hearing for the Permanent Subcommittee on Investigations as having involvement directly with organized crime?
A. That's correct.

THE HEARING OFFICER: So in context, the information went all into this public hearing in 1983, am I correct?

MR. BOSTWICK: That's correct.
BY MR. BOSTWICK
Q. Did any of these officials serve on the
80
Chicago District Council after 1983?
A. Well, as you have on your chart there, yes.
Q. Let's just refer to the officials because we have the graphics here.

MR. CARMELL: Excuse me.

THE HEARING OFFICER: Yes, sir.

MR. CARMELL: We have as I see it on this chart, we have two Frank Caruso's. We have a Frank Caruso, a Frank Michael "Mike" Caruso. And which one are we talking about on 145?

MR. BOSTWICK: I'm sorry. The highlighted individual, Frank Michael Caruso.

THE HEARING OFFICER: Is that any relationship with 145 here?

MR. BOSTWICK: Yes, that is this individual here. Sergeant at Arms. I'm sorry. You are right. We did highlight one too many.
BY MR. BOSTWICK
Q. Did any of these -- let's just talk about the officials on Exhibit 145 on this blowup, Mr. Gow. Did any of these officials serve on the Chicago District Council after the 1983 hearing?
81
A. Yes. The two that you have circled there, James Caporale and Frank Caruso, Sergeant at Arms.
Q. In fact, does Mr. Caporale attain the top status as business manager after this hearing?
A. Yes.
Q. Or at least I should say, be more accurate on that, serve as business manager after?
A. Serve.
Q. Let me refer you to another item you mentioned earlier, which is the President's Commission on
Organized Crime. I believe you mentioned that. Do you know when that occurred, the President's
Commission on Organized Crime hearing in Florida?
A. I believe that was 1985, 1986.
Q. Did they take testimony in that --
A. Oh, yes.
Q. -- effort? Prepare a report?
A. Yes.
MR. BOSTWICK: Exhibit 4 -- I believe I will move admission of Exhibit 4 and 5, but I believe
82

Mr. Carmell had stipulated to those, the form.

MR. CARMELL: Yes, I will stipulate to authenticity.

MR. BOSTWICK: Right, stipulate to authenticity, right? (WHEREUPON, said documents, previously marked GEB Attorney Exhibit Nos. 4 and 5, for identification, were offered and received in evidence.)

MR. BOSTWICK: As to just the 4 and 5, is that correct?

MR. CARMELL: Yes.

MR. BOSTWICK: Okay.

BY MR. BOSTWICK
Q. As to Exhibit 4, if you refer to that, Mr. Gow --
A. Yes. Exhibit 4 is the President's Commission on Organized Crime, and it's entitled Report to the President and Attorney General. It's captioned The Edge, Organized Crime, Business and Labor Unions.

THE HEARING OFFICER:
MR. CARMELL, you should know, I think everybody else knows, that I was the
83
first executive director of the President's Commission on Organized Crime, served for only two months. And the only thing I did was rent office space, and begin to, begin to put personnel together. But that came through at the end, so you don't see my name on there. But you will know that I was the first executive director before there was any staff. I left before any staff arrived.

MR. CARMELL: I did know that you were there, too short a time and did too little for me to raise it.
BY MR. BOSTWICK
Q. Mr. Gow, let me refer you to Page 2 of the summary, which is behind the first tab. Just so we all know what we are talking about here, could you read that paragraph that is highlighted which sets forth the scope of that?
A. It states that this is the second report of President's Commission on Organized Crime, examines the problems of labor and management racketeering by organized crime in the United States, and provides an explanation of how
84
modern labor/management racketeering operates and why it flourishes. The report also describes the role of the legitimate businesses in labor/management racketeering schemes, and explains how organized crime through domination, influence of labor organizations, employers and legitimate businesses, can control segments of entire economic markets, and can distort the cost of doing business to marketplace participants through theft, extortion, bribery, price-fixing, fraud and restraint.

THE HEARING OFFICER: Slow down. The reporter is trying to catch every word.
BY MR. BOSTWICK
Q. Mr. Gow, did the President's Commission on Organized Crime take a special interest in the affairs of the laborers' union?
A. Yes.
Q. As well as the District Council and affiliated entities?
A. That's correct.
Q. Let me refer you to what is the third tab, which just says LIUNA; you see that?
85
A. Yes.
Q. What is this section?
A. It's section 6. It's entitled, The Laborers' International Union of North American (LIUNA) A Case
Waiting To Be Made.
Q. Is that a separate portion of this report?
A. Section 6, yes.
Q. Okay. Let me have you turn to Page 2 of that. And I'd like for you to read that for us, the conclusion.
A. One of LIUNA's vice-presidents is John Serpico. Serpico is also president of LIUNA Local 8 in Chicago. In testimony before the Commission in 1985, Serpico admitted that he is a friend or personal acquaintance of virtually every important organized crime leader in Chicago. These include Tony Accardo, the boss of bosses in the Chicago La Cosa Nostra, Joseph Aiuppa, and Jackie Cerone, the LCN's principal underbosses to Accardo. Serpico also knows several LCN territorial bosses, who report to Aiuppa and Cerone, including Vince Solano.
Q. Let me stop you there. Does Vincent
86
Solano have relationship on the Chicago District Council?
A. Yes.
Q. Let me circle that up here. Continue.
A. Including Vincent Solano, president of LIUNA Local 1, Al Pilotto, formerly president of LIUNA Local 5, and Joseph Ferriola, who Serpico stated was a close personal friend.
MR. CARMELL: Mr. Hearing Officer, what is the relevance of John Serpico, whose local is not participant in this Chicago District Council? He is not an officer, never been an officer or delegate, with respect to who he knew.
MR. BOSTWICK: We will, we intend to prove that he has association with these individuals on the Chicago outfit side of things.

THE HEARING OFFICER:
MR. CARMELL has a point. And we will look for you to connect this up. I'm aware of Mr. Serpico, and the prior litigation in this union chair, and we will proceed, see how you solidify them. May I ask you a question? Gentlemen, we have been at it here for almost two hours. I
87
think the reporters might need a break, and just other folks might need a break. So I suggest we take about a good ten, twelve minutes here, 15 minutes, to regroup.
MR. BOSTWICK: Fine. (WHEREUPON, a recess was had.)

THE HEARING OFFICER: Okay,
MR. BOSTWICK. Go right ahead.
BY MR. BOSTWICK
Q. Mr. Gow, I think when we left off, we were referring to Exhibit 4, which is a select portion of the President's Commission on Organized Crime, their report. And we were on tab 3. We had just read the second page of that report, which was noted to me that wasn't actually Page 2, but it is the second page in this document, right?
A. That's correct.
Q. Let me take you to the fourth page behind that tab, which starts, The Locals. You see that?
A. Yes.
Q. Let me -- that is not a long passage. Why don't you just simply read what is bracketed.
88
I'm going to do what I just did before, which is highlight the individuals on this Exhibit 145.
A. This portion is entitled The Locals. In the first paragraph, as Serpico's Local 8 illustrates, organized crime's influence over LIUNA is most extensive at the local level. This control is particularly concentrated in large cities such as Chicago, Cleveland, St. Louis and New York, as well as smaller cities, such as in New Jersey. The best documented examples are influenced locals in the Chicago region. Again, the degree of control is relative to the number of union offices filled by LCN members or their relatives. For example, LIUNA Local 1 in Chicago provides a safe haven for known members and leaders of the Chicago La Cosa Nostra. The president of the Local 1 is Vincent Solano, a territorial boss of the LCN outfit on the north side of Chicago. Ken Eto, an LCN associate, knew Solano for many years and reported to him for almost a decade, and described Solano's operation and the territory he controls in testimony before the Commission.
89
Q. Why don't you skip right to the next page, and read the bracketed mark.
A. LIUNA Local 1 vice-president is Salvatore Gruttadauro.
Q. I'm going to stop you right there. Does he have a relationship with the Chicago Laborers' District Council?
A. Yes.
Q. All right.
A. LIUNA Local 1 vice-president is Salvatore Gruttadauro. The recording secretary is Frank "Babe" Demonte.
Q. I'm also circling Mr. Demonte on the Chicago Laborers' District Council chart.
A. Both individuals are members of the LCN whom Eto stated directed groups of criminals, soldiers and associates.
Q. Let me have you skip down to that next paragraph.
A. Chicago LIUNA Local 5 is another influenced local union. Former special International representative and local president Al Pilotto, who also served as vice-president of the Laborers' District Council in Chicago, is a
90
LCN territorial boss.
Q. Now I've marked him down already. Continue.
A. Another LCN member who has served as a union officer is Dominick Palermo, field representative.
Q. I'm going to mark Mr. Palermo down as well on Exhibit 145. That's all we'll introduce from this specific report at this time. But as I say, all of these excerpted portions we feel are relevant to the case. Mr. Gow, is the report generated by the President's Commission on Organized Crime publicly available?
A. Yes, it is, or was.
Q. Were you also aware of some Congressional hearings relating to organized crime in 1988?
A. Yes, sir.
Q. I'm going to hand up what has been marked as Exhibit 167. That is not on our exhibit list. We have only recently made copies of this. I can give out -- do you have one up there?
91
A. Yes, I do.
Q. Okay. Let me just give out -- now, this Exhibit 167, what is that?
A. It's entitled Hearings Before the Permanent Subcommittee on Investigations of the Committee on Governmental Affairs, United States Senate. And it's captioned at the top, Organized Crime, 25 Years After Valachi. And it's dated April 11th, 15th, 21st, 22nd, 29th, 1988.
Q. Who put this exhibit together?
A. I put this together.
Q. Where does it come from?
A. It comes from the record of the hearings, which I have a personal copy of.
Q. Is this the entire record of the entire hearing?
A. No.
Q. Why are the selections -- why did you select the portions that you did?
A. These portions have, in some manner, touch upon organized crime and its influence in the Chicago area.
Q. The only thing I want to direct your
92
specific attention to for the purposes of this testimony today is the last page of that exhibit. And this is a poorly copied chart. But can you describe for us exactly what that is?
A. Yes. It's a depiction of the chart that's entitled the Chicago Hierarchy. It's labeled Exhibit No. 9 for the Committee, and dated 1987. And in there, it's, I'll have to tell you, it's no better in the book.

MR. CARMELL: This is totally unreadable. It's nobody's fault. I couldn't even decipher a name or -- maybe they could reconstruct it and attach to it. I will accept what you do as being the persons who are on there.

MR. BOSTWICK: Let me try to do this through Mr. Gow. I believe Mr. Gow has copied the original which he is holding. It is still poor, but it's a lot better than the one you are holding. If we can do that through Mr. Gow, he has handwritten names; after review of those, you know, the book, we can simply introduce that as the original exhibit. I can give you copies of
93
the original. Is that acceptable,
MR. CARMELL?

MR. CARMELL: Yeah, if you can tell us where you are starting, start from the top and go to the left, so we can start to follow it along.

MR. BOSTWICK: Right. There is only five or six names, and that's the entire testimony.

THE HEARING OFFICER: I am taking a piece of blank paper here, and pencil, pen; we will let Mr. Gow draw squares and put names in it.

MR. BOSTWICK: That's perfect.

MR. CARMELL: That would be better.

THE HEARING OFFICER: There is only about four or five there.

BY MR. BOSTWICK
Q. As you do that, why don't you describe who they are. We will make copies of those and give them to everybody by tomorrow.
A. The chart depicts in the center, is a picture of an individual who is labeled the boss, and the name is Joseph Ferriola. Coming down the line, showing the chain of command here, you have between the capos and the boss, there is a line going off to the side,
94
consigliere, and that is Anthony Accardo. Then each of the bosses depicted down here is 1, 2, 3, 4, 5. 1 is Vincent Solano, Joseph Lombardo, Ernest Infelise, James LaPietra and Albert Tocco.

THE HEARING OFFICER: Would you just draft that before you leave? You can give us that.
BY THE WITNESS:
A. Can I have one -- you want me to do it or --

THE HEARING OFFICER: Yeah. Have one of your associates do it.
THE WITNESS: I'll do it.

THE HEARING OFFICER: But the object of this was to utilize the names, we are talking about bosses and --

MR. BOSTWICK: Right.

THE HEARING OFFICER: What was Mr. Accardo on that?
THE WITNESS: The consigliere.

BY MR. BOSTWICK
Q. What is the date on that chart?
A. Dated 1987.
MR. BOSTWICK: I'd move admission of that
95
exhibit. What we can do is staple Mr. Gow's writings or diagram to the back of that exhibit.

THE HEARING OFFICER: Is that, that came out of that, this came out of the hearing? What he is drawing up is simply what is in the, was in the hearing?

MR. BOSTWICK: That's correct. That was an exhibit to the hearing.

MR. CARMELL: Your Honor, one clarification.

THE HEARING OFFICER: Yes, sir.

MR. CARMELL: Joseph Lombardo, we had a secretary/treasurer, Joseph Lombardo.

THE HEARING OFFICER: I understand that.

MR. CARMELL: Is he on here?

THE HEARING OFFICER: I don't think that is Joseph Lombardo. It's --
BY MR. BOSTWICK
Q. Mr. Gow, can you answer that question for us? We can get testimony on that point. Is the Joseph Lombardo who is mentioned in there, to your knowledge, the Joseph Lombardo on this chart, the Joseph Lombardo, Jr.?
A. No.

THE HEARING OFFICER: No.
96
BY THE WITNESS:
A. No, he is not.

MR. BOSTWICK: We will handle relations and others through other witnesses.

THE HEARING OFFICER: But I'm sure that's not the same --

MR. BOSTWICK: That's correct. We don't want to create a misimpression.

THE HEARING OFFICER: You can move on, if Mr. Gow can do his drafting later.
BY MR. BOSTWICK
Q. Can you testify and chew gum at the same time, as they say?
A. We'll give it a shot.
Q. As the LIUNA Inspector General, did you also speak to former members of the FBI with experience in organized crime, for purposes of targeting the District Council, as a prior investigation from the LIUNA Inspector General's office?
A. That's correct; not only members of the FBI, but Department of Labor and even had contact with some State offices.
Q. Was the information you received
97
consistent with the information you reviewed in reports and the like that we have just gone over?
A. Yes, it was.
Q. How soon after you were hired as the Inspector General in February of 1995 did you personally participate in investigation of the Chicago District Council and select affiliated locals?
A. Well, as I previously mentioned, I took over this position February 1, 1995. And thereafter, in putting together our office and investigative team, it was in March that we put, so to speak, an investigative plan together to come into the area. And I came to town with several investigators on, from March 26th of 1995.
Q. All right. What was the purpose of your coming to town?
A. It was to initiate our investigation into the selected locals and the District Council. It was also to coordinate not only initial investigations, but to coordinate audits of these selected locals.
Q. Did you speak with anybody in Chicago
98
about this project that related to the District Council in any way?
A. Well, I had a couple of conversations but not in great depth, and I have to explain that a little bit because when I initially came to town I met with the regional manager, Terry Healey. Subsequent to that, on the following day, when we were attempting to institute our investigation or contacts with the people that we had identified for interview, I was basically put off by an attorney by the name of Hugh Arnold who in my recall was representing the District Council and these individual locals. And there was the question of representation by -- what representation the individuals that we wanted to interview were -- could have and should have, why they wanted to be interviewed, what we were doing, et cetera, these types of questions.
Q. What was told to Mr. Arnold about the purpose?
A. I gave him a very I would say brief interview of why we were there and the types of questions we would be asking these individuals.
99
He subsequently made available I believe it was on the 27th two individuals who we interviewed out at the regional manager's office, and I really don't recall their names right now. Following that, there was a series of interviews that were conducted that extended on for a couple of weeks.
Q. During the course of this trip did you receive a personal threat?
A. Yes, I did.
Q. Can I have you turn to Exhibit -- well, first let me ask you simply to tell the independent hearing officer and the delegates the nature of that threat.

THE HEARING OFFICER: Just briefly outline where we are going with this particular conversation about Mr. Gow and his threat.

MR. BOSTWICK: Establishing a foundation for who may have made the threat and why.

MR. CARMELL: Well, if he can't identify the -- I don't know what it's going to be; but if he can't identify the speaker, then I don't think this comes in, as free flowing as we may be.

MR. BOSTWICK: Maybe I can ask a foundational

100
question that would help you out.

THE HEARING OFFICER: I am just trying to put this into perspective here. Mr. Gow is out here conducting an investigation. Somebody gave him a phone call, am I right? Is it something like that?
THE WITNESS: Yes, it was a message that was left on the phone when I was not present at the time.

THE HEARING OFFICER: Well, let's see.

MR. CARMELL: A message left -- a message left on the voice mail in his hotel, unidentified, and at that point I really --

THE HEARING OFFICER: Let's do this.
MR. CARMELL: Strenuously object to it coming in for whatever it may be. That has gone too far.

MR. BOSTWICK: I think to have this discussion prior to hearing Mr. Gow lay a full foundation of it is a little bit premature.

THE HEARING OFFICER: I will tell you what we will do. Let's do this with this threat even though a lot of evidence can come into a trusteeship. Why don't you gentlemen do this. We

101
will move past this and at the break I would ask you to take the reporter and make a full transcript of what you are going to ask him.

MR. BOSTWICK: Of the questions I am going.

THE HEARING OFFICER: Questions you are going to ask him and his answers, just put it on and after you gentlemen can see it, you can tell me about it and I may like to hear it. Right now I am going to bypass it and at the break or sometime you just take the reporter aside and make a portion of it and I will decide whether I should hear it or not after I hear from both of you.

MR. BOSTWICK: In other words, I will actually take the testimony from the reporter and --

THE HEARING OFFICER: Just take the reporter up here in the corner and sit down and ask questions and after that, we will hear what it is and you gentlemen can explain to me. As I say, I am not a jury and I am not going to be influenced, overwhelmed by something that comes in about threats. In these types of investigations threats do kind of float around. I

102
am looking at the record and we will see how probative it might be.

MR. CARMELL: You have placed the cart before the horse because by putting it in the record, whatever you may say about it, by taking it -- the transcript and saying I've read it and I am not going to let it in, it's in.

THE HEARING OFFICER: I am going to hear from you first before we decide that we even put it in.

MR. CARMELL: Mr. Vaira, somebody has to lay a foundation for a conversation. I suggest that we first say -- get into the record what foundation he has concerning this. Came back to his hotel or whatever it is, picked up the machine, heard such and such and before he testifies, then say whether there is any foundation at that point for his statement -- for the supposed conversation.

THE HEARING OFFICER: Here is what we will do. Certainly he can lay the foundation and you gentlemen go and put it on the record after we are done. Yes, you should put the foundation. I didn't mean to cut you off. Go ahead.

103

BY MR. BOSTWICK
Q. Mr. Gow, why don't you tell us about how you -- the background of how you received this threat?
A. Well, I think the background of it is that, as I mentioned, that I had arrived in town on late afternoon of the 26th. I had not initiated any of the investigation. I had had a meeting with Mr. Healey and out at his place. He drove me to the hotel.

THE HEARING OFFICER: Who is Mr. Healey?
THE WITNESS: The regional manager.

THE HEARING OFFICER: Regional manager of LIUNA here.
THE WITNESS: Yes.

THE HEARING OFFICER: Whatever district it was in.
THE WITNESS: Yes.

THE HEARING OFFICER: All right.
BY THE WITNESS:
A. Following that, the following day is when we initiated our investigation. I had a meeting with the investigators.
Q. Excuse me. Your investigation of what?

104
A. Of the District Council and of the selected locals and we had a meeting with the investigators. We met with the audit staff. I had my conversations with Mr. Arnold, which, you know, were basically somewhat acrimonious.

THE HEARING OFFICER: Mr. Arnold told you that he was representing the District Council.
THE WITNESS: As best I can recall, District Council and the selected locals.

THE HEARING OFFICER: Okay.
BY THE WITNESS:
A. Following that, we did not gain access to any individuals that day. In fact, I had to go back to the International. When I say go back, not physically, but to my office back there, and have a letter drawn up again that was quite pointed, directed to the individuals out here that their failure to comply with the interviews and what ramifications that might have. It was that night after returning from dinner that this phone message was on my machine. You know, having been almost 30 years in law enforcement and then also spending five years in the U.S. Marine Corps where I had acted

105
as a brig officer and had received threats before, this to me --

MR. CARMELL: Objection. Now we should stop, Mr. Vaira, because we have gotten beyond the foundation.

THE HEARING OFFICER: He can describe it as a threat.

MR. CARMELL: If he is going to describe what he considers to be the threat and substance, we have then gotten beyond the foundation.

THE HEARING OFFICER: He is at least entitled to say he considered it a threat.

MR. CARMELL: I don't quarrel with that, what he considered it to be.
THE WITNESS: That's exactly what I was going to do. I wasn't going to mention the content of the call.
BY THE WITNESS:
A. All I was going to say, based on my experience in law enforcement and experience previous to that there was no doubt in my mind the reason for that phone call was made by an individual that was upset that I was there in town that day conducting the business that I was and it

106
was meant to put a damper on my activities. And I think I had -- that phone call was listened to by a number of the people who worked with me that are experienced, seasoned law enforcement officers, FBI agents I have known for years. Their same opinion also.
MR. CARMELL: Well, Mr. Hearing Officer, there is no foundation for this.

MR. BOSTWICK: I don't see.
MR. CARMEL: The only foundation -- wait.

MR. BOSTWICK: I'm sorry. I thought you were finished.
THE WITNESS: Judge, can I add one other thing?

THE HEARING OFFICER: Yes, sir.
THE WITNESS: I will just say I am not known in Chicago. I have not lived here. I have not worked here. So, for someone to call me in that type of a framework, in my mind, it leads right to the fact of what I was doing and why I was there. It was not based on any of my previous investigations or anything like that.

THE HEARING OFFICER: MR. CARMELL.

MR. CARMELL: We have no foundation other

107
than just his testimony that this Healey drove him to the hotel, that anybody knew where he was, in this telephone call, telephone message. And, secondly, even if anybody else did know, he can't identify who it was or where they came from. So, unless he wants to say -- testify -- and Mr. Healey is not a representative of the District Council. He is described as a regional manager. I would certainly doubt that he is implicating Mr. Healey. So, there is no foundation for this to come in and I would strongly urge that you -- it is not part of the Complaint. There is no allegation in the Complaint that anybody there made a threat unless you are going to get to that generic paragraph. Is that the generic paragraph?

MR. BOSTWICK: I will when you take a breath.

THE HEARING OFFICER: I think I have heard enough to at least let you gentlemen put this on the record out of my presence and then I will hear from you both after that.

MR. BOSTWICK: Mr. Vaira, may I be heard on

108
the whole point?

THE HEARING OFFICER: Yes, sir.

MR. BOSTWICK: What we are talking about here is obviously organized crime. In investigations of organized crime, threats are a part of that environment and that world. We are going to hear extensive testimony on that point. I don't see how Mr. Gow could have laid a clearer foundation for the introduction of this tape and for your Hearing Officer's consideration of it. There is no -- it can be admitted and then you can consider what weight you want to give it and how strong the connection is. Certainly in Mr. Gow's mind there is absolutely no equivocation as to why he received this message at this time. It relates specifically to what he was doing. It relates to the pattern that we have already established that is well known in public, and to not allow it I think is bordering on travesty. In addition, he has mentioned that we have not named this in the Complaint. This is a specific allegation in the Complaint. I can't refer the -- recall the paragraph. It's either 19

109
or 20. But this is part of the operations of the Outfit as they attempt to secure and maintain their power over the Chicago District Council and its affiliated entities.

THE HEARING OFFICER: Gentlemen, we will do -- you have had enough foundation certainly to make it clear that the observer and experienced law enforcement officer that makes his perception of a credible -- let's put it on the record out of my presence and we will make a decision. As I say, at the end of this case we are going to decide what goes in and what does not. This particular one, because there may be some difficulty connecting it, I will have to decide that. But you have made your record. We will hear it. It won't take any more than about three minutes to put this on the record out of my presence.

MR. CARMELL: Can I have the opportunity outside of your presence to cross-examine him concerning --

THE HEARING OFFICER: I assume you will do that.

110

MR. CARMELL: Well, not the content. But the foundation of it.

THE HEARING OFFICER: Yes, I assume you can do that.

MR. CARMELL: Maybe the best way to do it is that we could take a break and empty this room and then we wouldn't have to go hide in the corner.

THE HEARING OFFICER: Of course. Or just before we start back.

MR. CARMELL: Before you start back again after lunch.

THE HEARING OFFICER: Gentlemen, let us not make this some major suppression hearing. You have about five minutes to do it.

MR. BOSTWICK: Perhaps for clarification sake we should simply lay a quick foundation that the documents and the tapes are what they are. In other words, we don't have to tell the audience if that is what the concern is.

THE HEARING OFFICER: That's fine.
BY MR. BOSTWICK
Q. Mr. Gow, without referring to this content of the tape, the content of the transcript, let me refer you to Exhibit 58.

111

THE HEARING OFFICER: I presume that's the tape recording.

MR. BOSTWICK: That's actually the transcript.

THE HEARING OFFICER: The transcript of the tape. That's fine. You don't have to go through that. That's fine. We will accept that.

MR. BOSTWICK: Will you accept that this is a true and correct copy of the tape and the transcript? Exhibit 58-A and B.

THE HEARING OFFICER: I will accept your assurance of that. That's fine.

MR. BOSTWICK: Then I am finished with this. I have no further questions.

THE HEARING OFFICER: Okay, Mr. Gow. Thank you.

MR. BOSTWICK: I should say at this time I have no further questions.

THE HEARING OFFICER: Go ahead, sir.

CROSS-EXAMINATION BY MR. CARMELL:

Q. Mr. Gow, who appointed you to the position of Inspector General of LIUNA?
A. I was first contacted by Brendan

112
Sullivan in Washington, D.C. and asked if I would be interested in assuming this position. I --
Q. Were you aware at the time that Brendan Sullivan was Arthur Coia's personal attorney?
A. At my first contact, no, I was not. I later learned that.
Q. And the Arthur Coia I'm speaking about is Arthur A. Coia who was then and is now the general president of LIUNA?
A. That's right.
Q. So we are understanding that?
A. Right.
Q. And it was Arthur Coia and the General Executive Board that appointed you as Inspector General, is that correct?
A. The process, as I tried to explain to you before, I was interviewed by Brendan Sullivan, subsequently by the GEB attorney and then after that I had a meeting with Mr. Coia and then subsequently I assumed that the entire board approved my appointment.
Q. During the course of your duties as Inspector General you have issued reports which have been published to the membership, is that

113
correct?
A. That's correct.
Q. And were those reports published in the Laborer magazine?
A. That's correct.
Q. Now, do you recall in the report that appeared in March and April of 1995 making this statement: "In keeping with the bold and necessary mandate of January 18, 1995 by LIUNA General President Arthur A. Coia and the General Executive Board, the Office of Inspector General was created"? Do you recall that statement?
A. I really don't recall it, no.
Q. Do you recall making this statement: "On February 1, 1995 the General President and the General Executive Board hired W. Douglas Gow, a recently retired senior Federal Bureau of Investigation official," et cetera, "to open the Office of Inspector General"?
A. I don't dispute that.
Q. Was there any particular reason why

114
you -- strike that. You are aware, have become aware that the General Executive Board is made up of the general officers and the vice presidents, is that correct?
A. That's correct.
Q. And was there any particular reason why you singled out Arthur A. Coia for commendation in appointing you as Inspector General?
A. Other than in his position as General President of the union you would need deference in writing to something like that. In other words, let me explain. Basically a lot of the things that we do when we write, we write in the same vein as if we -- when we wrote them when I was in the FBI and when you delivered an article like that you always mentioned the director.
Q. So that you would equate Arthur A. Coia with J. Edgar Hoover in status?
A. No, I'm not saying that. I am not saying that at all.
Q. But in position?
A. He is the president of the

115
International union.
Q. I see. So that throughout the report you have in March/April, 1995 in Laborers, whenever you are talking about LIUNA, you talk about the General President and General Executive Board and that's just your custom to have done that, is that correct?
A. Yes, at that time.
Q. Now, you know before you were appointed that your appointment had been discussed with the Department of Justice?
A. I was told that it was done at some point in time. In fact, I was brought before the Department of Justice at a period after I was in the position.
Q. Let me try and break this down chronologically. Who told you that the Department of Justice was going to have input into your appointment?
A. I don't know if I'd characterize it as input into it --

MR. BOSTWICK: Let me simply put in an objection at this point to relevance. I realize

116
you may want to go far afield on this, but perhaps we could at least get a proffer from Mr. Carmell about why this is relevant to his direct.

THE HEARING OFFICER: I assumed in this process that all these individuals who were chosen had their names in some way run past the Department of Justice. I suspect.

MR. BOSTWICK: I would certainly stipulate to that.

THE HEARING OFFICER: I think that -- I think that the Department's aware of me. I have no idea what it is or the appellate officer, how it got by him. I assume. I strongly assume that the Department --
THE WITNESS: Sure.

THE HEARING OFFICER: -- knew who was going to be on the scene, this group that's been appointed. I don't think there is any secret. I don't know about myself, but I understand you met with the -- some individual.
THE WITNESS: It was subsequent as best I can recall to -- it was the first meeting after I was in the position that we had a meeting of all the --

117

THE HEARING OFFICER:
MR. CARMELL, I think you can be sure at least all individuals' identities were known. When I say the appellate officer, the GEB attorney.

MR. CARMELL: I appreciate that. What they were known to is not what I am getting at.
BY MR. CARMELL:
Q. What I am getting at, Mr. Gow, is you were aware that you could not be appointed to the position of Inspector General without the approval of the Department of Justice?
A. No, I was not aware of that at all. No one ever said that the Department of Justice would be the body that said I could or could not have the job. That was never mentioned to me at all.
Q. What was --
A. I took it as the governing people that was -- the two that I interviewed with, Bob Luskin, the GEB attorney, and Brendan Sullivan, were the two that were basically going to decide whether I would or would not have the job.

THE HEARING OFFICER: Gentlemen, what I think --

MR. CARMELL: All right.

118

THE HEARING OFFICER: Okay. What I wanted to just add as a matter of relevance, there is no question that the Department of Justice played some role in this procedure, because there was an agreement between the Department of Justice and the union. So, it is I assume and these individuals all in fact got some sort of tacit approval. The question becomes does that then so disqualify them to put them into this procedure. That I think is -- we are not going to go into. But you may raise the fact -- I think you made it -- that the Department of Justice knew and approved of their positions.
BY MR. CARMELL:
Q. You met with the General Executive Board attorney Robert Luskin and Brendan Sullivan before your appointment, is that correct?
A. Yes, sir.
Q. And when you met with Brendan Sullivan were you told --

MR. BOSTWICK: Objection.
BY
MR. CARMELL:
Q. -- who he was?

119
A. I'm sorry.
Q. Were you told who he was?

THE HEARING OFFICER: This whole history of how this came about, I don't know that it's at all relevant. You may point out that they have a bias now because they were appointed by the Department of Justice and the results of this -- I shouldn't say appointed. Approved by it. There has been some sort of agreement. Yes, there has been. There is no question about that that there is an agreement. Whether or not there is organized crime in this local and has it been proved, will it be proved. I think we are getting somewhat far afield.

MR. CARMELL: I didn't ask about the Department of Justice. I asked about Mr. Brendan Sullivan.

THE HEARING OFFICER: Mr. Sullivan was and still is Mr. Coia's personal attorney.

MR. CARMELL: You know, Mr. Vaira, with all due respect, you have said I am going to let everything in and you are jumping in in my fourth question and telling me what is relevant and what is not relevant.

120
I want to try my case. You may not like it. You may throw it all out. As far as I am concerned what I have heard so far from Mr. Gow is garbage. But you are going to make that decision. I went through the D'Arco affidavit and that crap came in and I have gone through it and I want to try my case. If you don't want to let me try my case, don't let me try my case. I have a reason, as you will see, hopefully, why these are relevant including the credibility of this witness.

THE HEARING OFFICER: So far this particular witness hasn't said an awful lot that comes down to credibility.

MR. CARMELL: He is the Inspector General and if you give me an opportunity, he is the person who brought this case. He has testified on direct examination that his purpose was to -- he had found corruption and he testified that he was -- the emphasis was on eradicating organized crime in LIUNA.

THE HEARING OFFICER: I assume that. I have now --

121

MR. CARMELL: Brendan Sullivan is Arthur Coia's counsel. Arthur Coia, as we will show, is O.C. Gow knows it. Everybody knows it. And let's find out what his credibility is, whether he wants to eradicate O.C.

THE HEARING OFFICER: Let me put it this way. This is an issue I faced in almost every one of my hearings in Buffalo against this a million times. If Mr. Coia is under investigation or if he is not, I will hear it. He is not on trial in this case. So, if you got any questions about that, you got -- I am going to have to hear that some other time.

MR. CARMELL: Oh, no. You are going -- if you are going to cut me off with Arthur Coia, then you are cutting me off from showing whether this witness is credible as far as what organized crime is and as to whether there are other reasons why this investigation has led to this Complaint for trusteeship.

THE HEARING OFFICER: That, I have ruled upon that about five other times, and in the case in

122
Buffalo. We are not even going to try it. Those individuals are not here.

MR. CARMELL: He testified about the civil RICO complaint, that he read that civil RICO complaint and took action on it.

THE HEARING OFFICER: I read that civil RICO complaint. I think the civil RICO complaint is off, sort of in other worlds, has no probative value here. Gentlemen, let us move on. I will cut off this line of testimony. We are not going to try a whole group of other persons. I'm going to hear the testimony about this particular District Council. But we are not going to go into that, because I have ruled upon that, and about five times, in Buffalo.

MR. CARMELL: I'm not interested in whether you ruled upon it in Buffalo.

THE HEARING OFFICER: I'm using it as precedent, so --

MR. CARMELL: You may have been wrong in Buffalo. Buffalo didn't get all the way --

THE HEARING OFFICER: Gentlemen, let us have

123
some order back there. This is not a local hearing where you can shout out. So the discourse is between me and Mr.Carmell. Okay. MR. CARMELL, I rule that that line of questioning is just not relevant here.
MR. CARMELL: Well --

THE HEARING OFFICER: You may make an offer of proof at some other time --

MR. CARMELL: I'm not going to make it. You have told me --

THE HEARING OFFICER: -- if you want.

MR. CARMELL: -- it's not coming in.

THE HEARING OFFICER: Okay.
BY MR. CARMELL:
Q. You are subject to being removed by the General Executive Board and Arthur Coia at any time, is that correct?
A. No, I'm not. I have a no-cut contract. It's, right now it extends through January of this year.
Q. If they removed you, they would be required to pay your salary, isn't that correct?
A. Sure.
Q. Yeah. But they can remove you and pay

124
you; you are like a ballplayer?
A. I'm not so sure they could, the way it's written.
Q. Now, is your job as general -- Inspector General a full-time job?
A. Yes, it is.
Q. What's your compensation?
A. 135,000 a year.
Q. Before you took on this job, what job did you hold directly before you became Inspector General?
A. I was in private consulting. Directly before I took this job, I was consulting with the U.S. Secret Service.
Q. What was your compensation then?
A. It was a lump sum over, for a period of a job. It wasn't based on an hourly rate.
Q. What was the lump sum for the period?
A. I believe for the period it was $20,000.
Q. Do you have any other sources of compensation other than possibly a pension, etcetera, while serving as Inspector General?
A. Some very minor.

125
Q. What kinds, minor?
A. I teach at the FBI Academy and receive a payment for that.
Q. Anything else?
A. Other than, if you're talking about interest on, you know, investments --
Q. No, no. I'm talking about work, jobs.
A. No, no. There was, early on, I had one other. I had been also consulting with an engineering company before I took this job. And after I had this job, they paid me some compensation for previous work done.
Q. How many persons are on your staff?
A. Oh, it varies. Some of the people have come and gone. I have, if you're talking about my staff at the office at LIUNA or total --
Q. No; total Inspector General staff.
A. Total Inspector General staff is somewhere in the neighborhood, it varies between 45 and 50 individuals.

THE HEARING OFFICER: Full time?
THE WITNESS: No, they are not full time.
BY MR. CARMELL:
Q. In the year 1996, if you know, what was

126
the total amount of money that LIUNA paid for the Inspector General's services, the whole staff, you, everybody else?

MR. BOSTWICK: I'm going to object to that.

THE HEARING OFFICER: I don't know what the relevance of it is. Can you tell me the relevance of, where you are going with this,
MR. CARMELL? I mean, the union -- he files a report; it's in the union, in the union record. What relevance is it that he has 45 persons working, he pays them half a million dollars, or whatever?

MR. CARMELL: He has a financial interest in his job.

THE HEARING OFFICER: I assume; I assume everybody has a financial interest in their job.

MR. CARMELL: His financial interest is subject to the Department of Justice keeping him in office.

THE HEARING OFFICER: May or may not be.
MR. CARMELL: Because I have a record that may go beyond you, Mr. Vaira; probably will, the way I see it. And I want --

THE HEARING OFFICER: How can you say that,

127
MR. CARMELL? Come on. How can you say that?

MR. CARMELL: Because the five questions, you cut me off; you talk to me about flowing and running rules and liberality and all of this. And you have said, hey, that's fine for one side, but not for the other. So I, these gray hairs don't come as much from worry as they come from experience. And I know, I sometimes know, what's down the road. I'll do the best I can. Now, having said that, am I cut off from asking him his financial interest, Department of Justice, the fact that he might bring a prosecution based upon not the facts as he found them, but somebody else told him to, or you are going to lose your job?

THE HEARING OFFICER: I think what you are -- why don't you ask him that question.

MR. CARMELL: I'd like to do it the way I want to. I'd like to present my case.

THE HEARING OFFICER: I'll allow you to pursue that line, to find out if he will lose his job if he doesn't perform.
BY MR. CARMELL:

128
Q. Mr. Gow, you report to the General Executive Board Attorney, is that correct?
A. Yes.
Q. Is there anybody else you report to?
A. No.
Q. When you began in --
A. Let me back up a little bit, MR. CARMELL, on that. We do produce a report that is required by the government, on a 90-day basis. And I don't produce the entire report. But I provide a section of it. So in effect, I guess you can say that it's a, I am reporting to the Department of Justice.
Q. Do you participate in meetings with the Department of Justice concerning the progress or concerning your investigations?
A. I do.
Q. Do you meet with the Department of Justice concerning who should be targets of your investigation?
A. Those discussions come up. But it's never that levied in those meetings that you will specifically do these things.

129
They have suggestions, and certainly their wish list as far as, you know, seeing that certain things are accomplished early on in the investigation. In fact, they provided a, so to speak, what we refer to as a wish list of targets for the investigation.
Q. Does the Department of Justice set priorities for your investigations?
A. Other than that wish list, as far as setting priorities, they have, as I said, spoken their minds at these meetings and what they deem as, you know, what we should be looking at, and where we should be going with regard to organized crime.
Q. Did you attend hearings before the House Judiciary Committee, Subcommittee on Crime, on July 24th and 25th, 1996?
A. I did. I don't remember the exact dates, but --
Q. Did you know a man named John C. Keeney, Deputy Assistant Attorney General?
A. Did I tell him?
Q. Did you know him then?
A. Oh, yes, yeah.

130
Q. Did you hear him testify?
A. Part of his testimony, I believe. I don't know how long he was on the stand. When I got there, I think he was on. I've known Mr. Keeney for 20 some years.
Q. Did you hear Mr. Keeney testify that the Department of Justice monitors the Inspector General?
A. I don't recall that. I don't dispute that. In fact, I told you we provide a report to them every 90 days. So if that's not monitorship, I don't know what is.
Q. Does the Department of Justice prod the Inspector General?
A. At the meetings, yes, there is some prodding that goes on.
Q. When the Department of Justice is not satisfied, does it expect the Inspector General to do further things?
A. When they are not satisfied, do they --
Q. With what you have been doing.
A. They have expressed dissatisfaction a number of times. And we have simply told them that the reason, you know, an individual can do so

131
many things at one time, or our priorities are this; so we have had those differences of opinion.
Q. Does the Department of Justice determine priorities in your investigations?
A. They try to have some input into it.
Q. That is not my question. If they tell you that that is a priority, is it a priority?
A. If they tell us that a certain thing is a priority, then I try to make it a priority.
Q. If they tell you that certain individuals or entities are targets, you will follow that, won't you?
A. I will look at it, yes.
Q. You will follow what they, the Department of Justice says, won't you?
A. Within the parameters of how I can do the work and what I've got going on at the time.
Q. Does the Department of Justice have access to all of LIUNA's internal documents?
A. All of their --
Q. Yeah.
A. I don't know if -- through subpoena power, they certainly would; if you are talking about my records or all of LIUNA's records --

132
Q. All of LIUNA's records.
A. Well, I can't answer that except in reference to my records.
Q. Well, let me ask you whether you agree with this statement that Mr. Keeney made to Congress on July 25, 1996, quote: The Department of Justice has access to all of LIUNA's internal documents, relating to its day-to-day operations and efforts it performs, unquote. Do you remember him saying that?
A. I don't remember him saying that, but --
Q. Do you --
A. -- I don't dispute it.
Q. You don't dispute it?
A. No, I don't dispute it.
Q. Now, let's discuss the agreement between the Department of Justice and LIUNA. You are aware of that agreement?
A. I'm aware of it. I was not part of it when the agreement was drawn up. And a lot of the nuances and so forth and what was said, I have not been privy to. So I don't know if I can help you here.

133
Q. Let's try. I hope you can; let's try and stay away from the nuances and get down to the guts. Under the agreement between the Department of Justice and LIUNA, dated February 13, 1995, the Department of Justice has the prerogative to end the internal process any time it believes and wishes to, isn't that correct?
A. That's correct.
Q. And if the Department of Justice makes that decision, there is a consent decree that has already been signed which would be filed, is that correct?
A. That's correct.
Q. And if that decree is filed, its Office of Inspector General ends, is that correct?
A. No. I was told that the Office of the Inspector General would continue on after that time. That is what I was told.
Q. Who told you that?
A. That was told to me by Brendan Sullivan.
Q. And Brendan Sullivan was not from the Department of Justice, was he?

134
A. No.
Q. Have you read the consent decree?
A. Originally. I really don't recall parts of it right now. I've always, when questions come on the consent decree that I would receive there, I would refer those to Bob Luskin.
Q. Having read the consent decree, did you find any provision in there for an Inspector General?
A. I don't recall anything like that.
Q. Do you recall that there were three offices that would be created; an independent monitor, do you recall that name?
A. Yes.
Q. Investigations office?
A. (Indicating.)
Q. And an election officer?
A. I think that's correct.
Q. And are you aware whether a consent decree, the investigative officer, will replace the Inspector General?
A. I don't recall the specific language that deals with that at all. I'm sorry.
Q. Are some of your duties to initiate and

135
conduct investigations within LIUNA?
A. Yes.
Q. To remove organized crime and all other criminal elements as a source of influence in the affairs of LIUNA?
A. To attempt to, yes.
Q. Now, are you aware that those are the functions which under the consent decree will be given to the investigation officers by the Department of Justice?
A. Again, I can't recall the specific language of the consent decrees. You would have to show it to me.
Q. If the Department of Justice would file the consent decree, you as an individual, Mr. Gow, would then have to be reapproved for a position, is that correct?
A. I would, I assume so. If you are trying to get to the point that I'm here as, so to speak, to make another career in this job, you're absolutely wrong. I have said publicly before, and I've said it not only to the Department of Justice, I've said it in public forums, I am not here -- I'm here to do the

136
job that they originally hired me for. I have no intentions of staying beyond a certain time. I haven't said, you know, exactly what that time is. I feel when, once the investigations that we have begun have come to a certain stance, then it's time for me to move on at that time. So if the point here is that everything is, I'm afraid of losing my job, I am not.
Q. Well, Mr. Gow, you probably were a fine FBI agent, but you are a lousy mindreader, because you don't know what I'm thinking. So I will proceed. It's not important what I think. It's important what the record shows. Mr. Gow, you have an ironclad -- you say you have a contract. When does that contract expire?
A. I told you, January of this year, January 31st.
Q. And are you planning to renew that contract?
A. I have not been asked if I want to renew it.
Q. Do you want to renew the contract?

137
A. I would probably stay a while longer.
Q. A while will be how long?
A. Possibly one more year.
Q. Would you want at least $100,000 a year?

MR. BOSTWICK: I have to object, your Honor.
A lot of this is, he is asking for speculation. And I'm not sure how it relates. I'm willing to listen to a lot of this, but --

THE HEARING OFFICER: I assume from the questioning that, from that consent decree, which I have read, is that if the Department of Justice pulls the plug, he is out of a job.
MR. CARMELL: As you are.

THE HEARING OFFICER: And who knows about me, you know? I could be out of a job too. So I assume if that goes, he goes. Now, the question then becomes really, what he is saying is that, has that, that threat of, motivated him to do or say things in this particular, in this particular context, which are not true or exaggerated. And that's, that is your issue. And I will assume he doesn't get the job; they pull the plug tomorrow, he's gone.

138

MR. CARMELL: You have -- so I will accept that. I'm through with that line of questioning. You have so tied my hands in showing that, you have said, Mr. Vaira, I'm here to decide Chicago District Council; I agree with that. Person who has testified concerning his attempts to eradicate crime has indicated that certain people have certain associations or work certain places. Now, sauce for the goose is sauce for the gander. If you really believe that, why can't I go into what other violations of the EDP, to which he has not any; I have a right to show that with other individuals who may be similarly circumstanced, he does not believe these to be EDP violations. That is what we are here for, is EDP. Now, will I make that total connection to your satisfaction? I don't know. Do I have a right to show that if he says, I want to eliminate from the ranks of the LIUNA, any place, any place I find it, organized crime, and here is what I say is organized crime, it is this connection, let's use it for my sake, 1, 2 and 3, and I can show that 1, 2 and 3 over here, on my left side, he

139
brings no charges against, that goes to the issue of whether 1, 2 and 3 in fact are connections that warrant violations. I understand your argument. We call it the speeding argument; the fact that you got caught as a speeder doesn't say that everybody else was speeding at 90 miles an hour. That is not my purpose in it. But my purpose is to get into what is truthfully and what factually are matters which would warrant EDP violations, now, that, or violations of the Constitution, both. And that's why I have a right to go into other instances.

THE HEARING OFFICER: Okay. Let me address it.
MR. CARMELL, this individual is, you have laid some foundation. He said based upon his experience, some of these individuals are connected to organized crime. I presume there are going to be some other persons involved. We will just take any, any example, even though the names -- Spingola nobody has talked about, but let's assume Mr. Gow said, Joseph Spingola I'm convinced is a member of

140
organized crime, all right? The proof of this case is, is that true, and is, will that be corroborated by some other evidence? Is that standing alone sufficient? Now, whether Mr. Gow should be chasing Jones, Smith and Brown who are over in Rhode Island or wherever they are, and is laying down on the job or not chasing them or not, is not relevant. All I'm saying is, do we have proof that -- I'm not saying Spingola is -- just let's say, do we have proof that Spingola is connected to, enough to indicate that the District Council has persons like him running it or whatever it is. Whether or not he is doing something else someplace else is not of our concern. You may argue that, and he is laying down on the job someplace else, to protect his own business. I'm only concerned with this record. Do we have information that these individuals who are running this particular District Council are connected to organized crime? Is his statement verified, corroborated by others?

141
And that's why I'm saying, I'm not tying your hands; I'm trying this case, not others.

MR. CARMELL: But you have ignored at least one vital point, and that's Title III of Landrum-Griffin, which is the trusteeship provision.

THE HEARING OFFICER: I'm familiar with that.

MR. CARMELL: Which permits trusteeships only for specified purposes.

THE HEARING OFFICER: That's right.

MR. CARMELL: One of the defenses, maybe one of the few defenses, is that a trusteeship has been brought for an improper purpose. That's clear in the law.

THE HEARING OFFICER: That's right.

MR. CARMELL: One of the things I have a right to show is whether this was brought for an improper purpose. I can do that only by comparisons. You will make the decision as to whether, assuming, let's assume that there are criteria that if it's for a wrong or improper purpose, that is a total defense, as I read the law, is a defense to a

142
Title III prosecution.

THE HEARING OFFICER:
MR. CARMELL, those --

MR. CARMELL: And I -- let me just finish.

THE HEARING OFFICER: Go ahead.

MR. CARMELL: And so that is one of my defenses. You are saying I can't go into it. Mr. Gow was not on this stand merely testifying as being a scrivener. We could have put documents into evidence, Mr. Vaira, without Mr. Gow. It's obvious that the Senate committee, those PCOC hearings are public documents. He has been put on the stand as the investigative officer who has pursued this case. And he is saying, here is why I've pursued it. My FBI friends, informants, have told me this, this. I want to eradicate organized crime. I'm here on my white horse doing it. And this place, this Chicago District Council has organized crime. He is the witness. I have a right to test his credibility as to whether he really believes that.

THE HEARING OFFICER: I don't know that he really believes it. I don't know --

MR. CARMELL: I do, because he testified to

143
it. Wait. You may say it's not material. But they put him on for this.

THE HEARING OFFICER: You remember my question was, look, I'm not really interested in how you got here. I'm not really interested if you were flying over it and looked down and decided one afternoon that Chicago ought to be a place you could land and come in the summertime. I'm not concerned about that. I'm concerned about what is the evidence before us.

MR. CARMELL: But I am, because I have a defense that is entitled by Title III, under all the court cases, and one of them is that the, that this complaint has been brought for an improper purpose.

THE HEARING OFFICER: But you know what those cases are. Without bringing in some legal philosophical discussion, proper purpose means that the International Union is trying to stifle dissent. They are trying to take over. That is the improper purpose.

MR. CARMELL: True.

THE HEARING OFFICER: If one of the purposes is that they have organized crime, they want to

144
siphon it out, I don't think you have that.

MR. CARMELL: I have a right to show their legitimate activities. I have the right to cross-examine Mr. Gow. Mr. Gow is on cross-examination here. He is their witness. He is there because I believe -- I want you to reconsider so I am giving as much as I can. I am not trying to hold back. I am saying that this is exactly one of the defenses within the purpose. How do I show that? I show that through comparisons. I show that through evidence of what biases he may have or prejudices he may have. I show it through the fact that it may not have been his decision to even bring this case. It may have come from another party. Let's just say it came from the Department of Justice. Let's say that I can prove, Mr. Vaira, that he sat in the Department of Justice office and said, guys, I can't bring this case. There is no evidence. And they said we're going to pull the pin unless you do it. Now, that's relevant. Do I have a smoking gun? I may have

145
one. But I certainly have a right to make a warm gun through circumstantial evidence. You are experienced and a far better prosecutor than I would ever imagine, and that is not strokes, and you know the difference between an indirect circumstantial evidence case. There aren't a lot of direct smoking guns where the guy gets up and says I robbed the bank or I embezzled the money, and paper and inferences and all of the matters that are there are to be drawn from the record. Give me my opportunity to do that. You have not given me any leeway and I am telling you that I will tie it up. If not, you will do exactly what you said you would do with
MR. BOSTWICK. You would just take it in provisionally and you will throw it out at the end of the case.

THE HEARING OFFICER: Okay. But I still don't know where you are going, how much he makes and I don't know how relevant that is. He makes money. Maybe next year he doesn't get the $100,000.
MR. CARMELL: The issue is now and if they

146
might pull the pin. You might not draw that inference, but you are not allowing me to put it on the record. That's the difference.

THE HEARING OFFICER: I can't see where you are going.

MR. CARMELL: You don't have to see where I am going. You have to let me get there.

THE HEARING OFFICER: I have to see where you are going. I am saying if there is evidence of organized crime these ladies and gentlemen are trying to put on here and if they show -- I think that goes a long way to show that there is no improper motive.

MR. CARMELL: It may go a long way. But you leave me without the opportunity to say there is anything in the record which I could argue shows an improper purpose. You have cut me off from it. What you have left in here is Mr. Gow pontificating as to what he believes is organized crime, showing, reading excerpts from President's Commissions on Organized Crime in 1983.

THE HEARING OFFICER: Anybody could have read those.

MR. CARMELL: I agree with you. Anybody

147
could have read them. If Mr. Gow's position up there is not that this is part of his investigation -- he is telling us why he came to Chicago and he is telling us why he has put this together. This case is his. He is the investigator. The General Executive Board attorney brings it, but I will show that this was his evidence, his investigation and his case. I have a right to show the length of time it's taken, where it's been, where the dissidents are, where free speech is being trampled upon, where other people similarly circumstanced are still in office and haven't been touched and from that you can say when it's all over with I didn't make my improper motive. But you are not going to let me do it and that is one of my defenses. And we would spend less time if you let me go through my cross-examination and get those matters in that I believe are appropriate and go do what you have to do as the independent hearing officer.

THE HEARING OFFICER: What you are saying -- here is what I am going to do, Mr. Carmell. I am

148
going to deny your motion, but I am going to ask you to put -- when he leaves, take some time to put this on the record as a matter of proof and I will reconsider it. Tell me where you are going, put it down, what questions you would ask, where you were planning to go with it and I will tell you if I think it goes to the area of the improper motive. Okay. You may proceed. On some other subject.


MR. CARMELL: I really don't find a subject that doesn't seem to be improper. Because you have cut me off from lots of areas which are the crux of my defense, I think we should take our break now, luncheon break, and I will have to look through this and see where we are going to go.

THE HEARING OFFICER: Here is what we will do. Come back. You want an hour, MR. CARMELL. After we come back -- roughly an hour. You can have a little bit more, certainly. You come in. The first thing you gentlemen will do before we -- we will clear the room and put your evidence on concerning whatever

149
this --

MR. BOSTWICK: The tape. The threat.

THE HEARING OFFICER: Then we can bring everyone back in and,
MR. CARMELL, you can make your offer of proof in whatever form you want to make it, proposed questions or outline form.
MR. CARMELL: I prefer to do it in questions, questions that I would ask him and I would assume that each one of these questions would be answered in the affirmative.

THE HEARING OFFICER: All right. We will do it that way. Okay. We will take our break now and we will come back.
MR. CARMELL, what time do you want? 12:30. Quarter to 1:00?

MR. CARMELL: Quarter to 2:00.

THE HEARING OFFICER: I'm sorry. Quarter to 2:00. (WHEREUPON, at 12:30 p.m. the hearing was recessed
until 1:45 p.m., this day, July 16, 1997.)

150
OFFICE OF THE INDEPENDENT HEARING OFFICER
LABORERS' INTERNATIONAL UNION OF NORTH AMERICA

IN RE: TRUSTEESHIP PROCEEDINGS
No. 97-30T CHICAGO DISTRICT COUNCIL

July 6, 1997 2:00 p.m.

The hearing resumed pursuant to recess.

BEFORE: MR. PETER F. VAIRA, Hearing Officer

151
PRESENT:

COMEY, BOYD & LUSKIN,
(1025 Thomas Jefferson Street, N.W.,
Washington, D.C. 20007-5243),
by: MR. ROBERT M. THOMAS, JR., MR. DWIGHT P. BOSTWICK, appeared on behalf of the GEB Attorney;

CARMELL, CHARONE, WIDMER, MATHEWS & MOSS, LTD.,
(225 West Washington Street, Suite 1000, Chicago, Illinois 60606),
by: MR. SHERMAN CARMELL, MR. MARTIN P. BARR, MS. SUZANNE M. LAW,
appeared on behalf of the Chicago District Council of Laborers.

ALSO PRESENT: MS. CHERYL MARQUARDT

REPORTED BY: MARY KAY BELCOLORE, CSR, RPR. CORINNE T. MARUT, CSR, RPR.

152

THE HEARING OFFICER: Back on the record. Ladies and gentlemen, the hearing is now again in session. In the meantime, I reinforce the exclusionary rule at the request of some members, and only the persons who are permitted to be here. So we have taken care of that. You gentlemen that made that objection, see we carry that out. MR. BOSTWICK and MR. CARMELL are going to proceed with an examination of Mr. Gow here on a matter that I said that we would hear out of my presence. Gentlemen, you want me to step out?

MR. CARMELL: No. You are going to make a ruling. We are going to hear it. Everybody will know what was said. And then we will make our motion at that time.

THE HEARING OFFICER: All right.
REDIRECT EXAMINATION

BY
MR. BOSTWICK
Q. Mr. Gow, I just have a few questions for you on this specific point. Can you pull out Exhibit 58?
A. 158?

153
Q. No; 58. Mr. Gow, there is technically a 58-A and 58-B. The tape itself is 58-A. The document is 58-B. Can you tell me what the document is, 58-B?
A. Exhibit 58-B is a memorandum from myself to Bob Luskin. Subject is threatening phone call to Inspector General Gow, 3/29/95 in Chicago, dated June 3, 1997.
Q. Is there a full transcript of the tape of the 58-A on that --
A. Yes.
Q. -- included in that exhibit?
MR. BOSTWICK: I'm simply going to ask that we move introduction of 58-A and B, and we play the tape.

THE HEARING OFFICER: We will hear the tape.
THE WITNESS: I have the original.

THE HEARING OFFICER: Miss Reporter, we have the transcript of the tape. You can take it down from there. It is short. You might have trouble hearing it anyway. (WHEREUPON, there was a short interruption.)

154

MR. BOSTWICK: We are having trouble playing the tape, obviously.
THE WITNESS: It's coming next.

THE HEARING OFFICER: Okay.

MR. BOSTWICK: It wasn't cued up. (WHEREUPON, tape was played, as follows: "Douglas. You fucking piece of shit. Who do you think you're fucking with? A bunch of kids from Waco? I'll fuck your family in the face. I'll fuck your mother in the mouth. You fucking piece of shit."
THE WITNESS: That's it.

MR. BOSTWICK: I have nothing further.

THE HEARING OFFICER:
MR. CARMELL, go ahead.
RE-CROSS EXAMINATION BY
MR. CARMELL:
Q. Beginning with the latest, which is this tape, you testified you came to Chicago on March 26th, 1995, is that correct?
A. That's correct.
Q. When did you leave Chicago?
A. On the 28th.
Q. March 28th?

155
A. Yes.
Q. I see. Now --
A. No, wait.
Q. According to -- just a moment. You have a change in date?
A. No, I don't have to change the tape. I was just trying --
Q. Not change the tape; change the date.
A. This call was made on the 29th. I left the next day.
Q. Okay. So now you are saying you didn't leave on the 28th?
A. Couldn't have.
Q. But you left on the 30th of March?
A. It would have to be on the 30th that I left, because I left from -- I was out at the regional office, out at regional office. And I left the afternoon, it was the day after this call.
Q. How do you fix the day of when you left Chicago?
A. Just as I mentioned to you. I was, the following day I checked out of the hotel; was out at the International, left from the

156
International. I was with my deputy, Bill Rice. So there was an individual with me. I believe Joe Griffin was with me out at the International that day.
Q. What time did you leave Chicago on the 30th of March?
A. Oh, it was afternoon. I can't remember the exact time. It seems to me it was, as best I can recall, I would think somewhere around 4 or 5. I'd have to go back and look at my voucher to get the exact time.
Q. Let's find out who you -- now, you were in at the Chicago Hilton and Towers; that's where you were staying, is that correct?
A. That's correct.
Q. That's where the telephone call came in, is that correct?
A. Yes.
Q. And I did not hear anything on the voice mail that told us the date of the telephone call. So you're fixing the date as March 29, is that correct?
A. And I have, in addition to that, there were three other people that were witness to the

157
phone call that can testify to the date.
Q. Great. Could you just answer the question.
A. You asked me if --
Q. There is nothing on the voice mail that tells the date as being March 29, is that correct?
A. I don't recall it, no. No such thing. Now, the original date was picked up and has been given to the FBI. It would be on there.
Q. Well --

THE HEARING OFFICER: The date -- you can explain your answer. After he asked you was anything on the tape, you may explain later on why you think it was on the 28th. The date, gentlemen -- go ahead, go ahead.

BY MR. BOSTWICK

Q. Now, let me go through persons who would have known that you were at the Chicago Hilton and Towers during that period of time. One was this gentleman Terry Healey, is that correct? You're nodding. That doesn't do us any good.

158
A. That's correct.
Q. And he was regional manager of LIUNA?
A. Yes.
Q. The other were auditors of Thomas Havey & Company, is that correct?
A. Yes.
Q. And they were representatives you had hired -- I mean -- strike that. Who was Thomas Havey Company?
A. They are an audit firm that is located basically nationwide that has an expertise in labor-related matters.
Q. And then there were -- how many of your staff knew that you were at the Chicago Hilton and Towers?
A. Well, at that time the people that would have been back at my office, the agents or the representatives that were with me because they were all staying at the same hotel.
Q. Can you tell me approximately how many?
A. We had, let me see, four of us.
Q. Did you leave a number at your office where you could be reached?
A. Yes, they had a number where I could be

159
reached.
Q. Anybody who came in and asked for that number from your office could have obtained that number?
A. Not necessarily. The office -- we operate on a need-to-know principle. So I mean anybody to walk in and say I need to get a hold of Doug or something like that, if it was somebody unknown to my people, they wouldn't have been given the number.
Q. Now, another person who knew or another entity that knew you were in Chicago is the Sophisticated Traveler travel agency in Providence, Rhode Island, is that correct?
A. That's correct. They made the reservation. Mr. -- in addition to that, the GEB Attorney's office knew I was in Chicago at that time also.
Q. And also -- you talked about members of your staff. Just a moment. Let's stay with for a moment -- did Mr. Hugh Arnold know that you were staying at the Chicago Hilton and Towers?

160
A. He talked to me there while we had our meetings with the audit people. I never -- to my knowledge, I never told him I was staying at the hotel. But that's where, you know, the number -- I gave him I think my beeper number and called him from the hotel and gave him a number because it was a pay phone that I was talking from. I never gave him the room number.
Q. You never told Hugh Arnold that you were staying at the Chicago Hilton and Towers?
A. No, I don't recall mentioning to him I was staying there. I called him from there and he certainly knew I was calling him from there.
Q. Now, between March 26, 1995 and the date that you had this voice mail message, had you interviewed any LIUNA members?
A. No.
Q. Had you told anyone else where you were staying other than the people we have gone through?
A. The additional investigators that were working with me that live in this area knew I was staying there.

161
Q. Staying with the Sophisticated Traveler, didn't you at some time recommend that the LIUNA stop doing
business with the Sophisticated Traveler?
A. That's correct.
Q. And wasn't that because the husband of the owner of Sophisticated Traveler had mob associations?
A. Yes, that's correct.
Q. So that when did you first learn that the Sophisticated Traveler was connected to the mob?
A. That information was sometime after this event occurred. I'm trying to think back exactly. It was probably six months or later after that investigation was completed.
Q. And the mob that I'm referring to is the -- what has been referred to in various documents as the New England family, Raymond Patriarca, Jr.?
A. Yes, yeah.
Q. Did you recognize -- do you recognize the voice on the voice mail?
A. No.

162
Q. To your knowledge has the FBI made any arrests based upon the voice mail?
A. No.
MR. CARMELL: That's all I have on that subject. Mr. Vaira, what I'd like to do is two things. One, I'd like to move on to another areas; and with respect to the areas that were our colloquy, I'd like to have the opportunity to read the transcript tonight, see exactly what is out there.

THE HEARING OFFICER: To make a proffer.
MR. CARMELL: Yes. See what the proffer of proof is. I presume Mr. Gow is going to be here tomorrow in case it's going to be -- in case you stayed with your ruling and it's going to be a proffer of proof through question and answer so that he may be here. Am I correct? If not -- am I going to hold him over?
THE WITNESS: I had a reservation to go out tonight.

163

THE HEARING OFFICER: Here is my question. You make the proffer through questions and give me what you think the answer would be.

MR. CARMELL: All right. I can do that now or I can do that later. I think if Mr. Gow is not going to be here and if the proffer that you are saying I have to make is mine, I will be both attorney and witness. Let me finish as much as I can with Mr. Gow. Let me finish Mr. Gow.

THE HEARING OFFICER: Okay. You are going on to another subject.

MR. CARMELL: Well, yes, because I am not going to be able to ask him these questions as I understand your ruling.

THE HEARING OFFICER: Okay.

MR. CARMELL: All right.
BY MR. CARMELL:
Q. Mr. Gow, you have seen the witness list and you know that Ron Fino is on the list?
A. Yes.
Q. Is that correct?
A. Yes.
Q. And is Ron Fino an adviser to you?

164
A. Yes.
Q. Is he a paid adviser?
A. Yes.
Q. How much does he receive?
A. He receives an hourly rate and expenses.
Q. And what is the hourly rate based on? You will pay him for what?
A. Pay him for the times that we are debriefing him for information that he prepares for us, review of previous testimony, any -- I shouldn't say witnesses. Other sources that he may lead us to. Any other types of information that he digs up that would appear to be of value that we would evaluate it.
Q. Do you pay -- do you pay him for time testifying?
A. He has -- yes, he has been paid for his time when he has been testifying.
Q. Let me break it down, if I may, sir. What is Mr. Fino's hourly rate?
A. $75 an hour at this time.
Q. And when you say that he is being paid to testify, is that based on an hourly rate or is

165
there --
A. No.
Q. Let me finish my question, sir. It may help out a bit. Is it on an hourly rate or a flat rate?
A. No, it's on an hourly rate. It's not based -- it's not being paid to testify. It's being paid for his time away from his other work.
Q. What is Mr. Fino's other work?
A. Well, I think we are dealing with a person that is --

THE HEARING OFFICER: I have sustained a prior objection to that in another proceeding. I think in that other proceeding we described it generically, did we not?
THE WITNESS: I wasn't there.

MR. CARMELL: We weren't there.

THE HEARING OFFICER: We described it generically. He described that he was in business for himself.
BY MR. CARMELL:
Q. For Mr. Fino -- if Mr. Fino is called as a witness here, he will be paid at an hourly rate for his travel and for the time that he

166
testifies, is that correct?
A. That's correct.
Q. You have a written contract with Mr. Fino?
A. We have a, we originally did; we have not updated that. We are in the process of, you know, redoing that.

MR. CARMELL: I'd like to have that written contract, copy of that written contract, Mr. Hearing Officer. If they can redact his address, they can redact anything that is identified on it, I would like to see what that contract is.

THE HEARING OFFICER: Gentlemen, is there any argument that he -- we know he is getting so much an hour. We know he is getting paid for travel. He gets time and expenses. Is there anything else in that contract of any --
THE WITNESS: That's it.

MR. CARMELL: Sir, it's not for them to tell us what it is. I've had the experience where I've heard testimony, I've seen the provision in the contract, which a particular party has forgotten or considers it to be insignificant, which I

167
don't.

THE HEARING OFFICER: Okay. All right.

MR. BOSTWICK: Perhaps this would be brought out by the time, if Mr. Fino in fact does testify, maybe we can readdress this issue then. I have never seen a contract. And I initially would object to it, but --

THE HEARING OFFICER: We'll get it.

MR. CARMELL: Perfectly fine, that if anything concerning Ron Fino comes in, I know that what we refer to as 302s, FBI 302s are exhibits here, with Ron Fino, I do want to see those, that contract, if MR. BOSTWICK decides to introduce anything with respect to Ron Fino.

THE HEARING OFFICER: I take it -- I saw his name on the witness list.

MR. BOSTWICK: That's correct. His name is on the witness list. If we call him, I guess we can revisit this issue. I just don't think it's appropriate at this time with this witness.

THE HEARING OFFICER: We will be replowing the ground a second time. So let us move on. If that issue is relevant, we will certainly take that on.

168
BY MR. CARMELL:
Q. Mr. Gow, I want you to look at GEB Exhibit 145. You may have on -- can you see it? We do have a smaller version of it.
A. I can see it.
Q. Better man than I. Now, under the rubric, selected, select officials, field representatives or delegates, Joseph Abate, A-B-A-T-E, what time period does he fall?
A. He would fall in the time period of 1970 to 1995, in that chart.
Q. For the full 25 years?
A. Well, at some point in time in there. There is another chart that addresses that. And I just can't recall off the top of my head. You would have to look at that other chart.
Q. Do you know what -- did Joseph Abate during the time period hold any position other than a delegate to the District Council?
A. Again, I'd have to refer to that chart. As best I can recall, I believe he did.
Q. Let me try and move this along a little bit. If I asked you about any of the 13 people

169
who are listed under that rubric, can you tell me what positions they held, other than delegate?
A. Some I could. Others, I'd have to refer to the chart.
Q. Why don't you tell me what persons you know, the positions they held.
A. Well, Vince Solano is a president of, I believe it was Local 1.
Q. Okay.
A. DiForti was a, I believe a delegate, field rep to the District Council. John Galioto is an officer of, it's either 225 or 5.
Q. Wait, please understand my question. What position did --
A. Of these select officials, of the reps.
Q. Yes, on the District Council.
A. Again, I'd have to refer to that chart. I just, you know --
Q. Fine. Then we won't burden you. We are not here to test your memory. We are here to get the facts, if we can. If I ask you about the dates of things, would you say the same thing?
A. Yes.
Q. You would want to refer to the chart?

170
A. I'd have to refer to the chart. I haven't, you know --
Q. Now, I want to discuss with you, as you've already discussed, the structure of the Chicago District Council. Now, the Chicago District Council is governed by the Uniform District Council Constitution, is that correct?
A. That's correct.
Q. Uniform District Council Constitution is adopted by the convention of delegates at the quadri -- "quintennial," every five years convention, is that correct?
A. Yes.
Q. And the current Uniform District Council Constitution was adopted at the convention in 1996, is that correct?
A. Correct.
Q. And that was during the period of time that you were -- that you were investigations officer, is that correct?
A. That's correct.
Q. Did you have an opportunity to review the Uniform District Council Constitution before it was adopted by the delegates?

171
A. No.
Q. Did anybody ask you to?
A. No.
Q. Are you aware of any objection that was raised by the General Executive Board Attorney to the Uniform District Council Constitution as adopted in 1996?
A. I can't recall any specifics. I stayed out of that area.
Q. Getting to the structure, the members of the District Council are delegates from affiliated locals, is that correct?
A. That's correct.
Q. And the number of delegates from the local is based on the number of members?
A. That's correct.
Q. The business manager of the local is a delegate to the District Council by virtue of his election to the office of business manager of the local, is that correct?
A. That's correct.
Q. All the other delegates must be elected as delegates in accordance with the Local Union Uniform Constitution, isn't that correct?

172
A. That's correct.
Q. Now, the officers of the District Council, in order to be a candidate for District Council officer, you must be a delegate?
A. Correct.
Q. And the District Council Executive Board is composed of seven members, is that correct?
A. That's correct.
Q. And the Executive Board of the District Council acts between delegates at meetings, is that correct?
A. That's correct.
Q. Now, in your review of the Chicago District Council, did you find that there were minutes kept by the Executive Board?
A. Yes.
Q. And did you receive all of the minutes, as far as you know?
A. As far as I can recall, yes.
Q. For what period of time?
A. Again, it would be for the period of 1970 to 1995.
Q. And the delegates are to meet once

173
monthly, is that correct?
A. Yes.
Q. And you have minutes of the delegates' meetings of the Chicago District Council, don't you?
A. Yes.
Q. And did they meet basically monthly?
A. As best I can recall, yes.
Q. And that a quorum of delegates for action at a meeting is the majority of the locals, is that correct?
A. That's correct.
Q. Now, from your examination of the minutes, isn't it true that the Executive Board minutes would be read to the delegates?
A. Let me make it clear that I did not make an examination of the minutes. That was done by other people. But you're correct in what you're saying.
Q. And as far as you know, obviously from reports from staff persons, and those minutes would be put before the delegates for their approval or disapproval, is that correct?
A. That's correct.

174
Q. And the finances of the District Council were read to the delegates, is that correct?
A. As best I can recall.
Q. And they were put to the delegates for their approval or disapproval, is that correct?
A. Again, yes.
Q. Now, what, if you know, what were the duties of the sergeant-at-arms in the District Council?
A. Sergeant-of-arms is to maintain order, to ensure that, so to speak, the bona fide people are the ones that attend the meetings, that, you know, no one that is not duly constituted is not involved.
Q. Is the sergeant-at-arms a member of the Executive Board?
A. Yes.
Q. Are you sure that he is a member of the Executive Board?
A. Yes.
Q. Okay. One moment, please.

THE HEARING OFFICER: Article 5, article 5.
MR. CARMELL: Yeah.

175

MR. BOSTWICK: Perhaps if MR. CARMELL is going to ask him or quiz him on the provisions of the Constitution, we can refer him to the provisions of the Constitution at hand. Is that what --

BY MR. CARMELL:
Q. Is it your understanding that, from the local union, that the delegates other than the business manager have to be elected by the membership of the local union?
A. Yes.
Q. And the Local Union Uniform Constitution sets out the procedures for nominations and elections?
A. That's correct.
Q. Does the Uniform District Council Constitution provide for the appointment to fill vacancies in the Executive Board?
A. I believe it does.
Q. Do you have problems with that provision?
A. I'm sorry, what?
Q. Do you have a problem with that provision?

176
A. Do I have a problem with it?
Q. Yes.
A. No.
Q. Is that an undemocratic provision?
A. No. That's a standard practice.
Q. The Uniform District Council Constitution provides that a term of office of officers is four years, does that sound familiar to you?
A. Four years?
Q. Four years, for the District Council?
A. I believe it was three.
Q. Well, I can refer you to the provision.
A. I may be wrong.
Q. It doesn't matter. Do you find that there's anything undemocratic about having that term of office, four years?
A. No.
Q. One of the allegations in the complaint is that there has been no opposition for elections in the District Council, do you recall that?
A. Yes.

177
Q. Do you find it undemocratic for a candidate to be deemed to be elected if he or she is not opposed?
A. That's a question I don't think I can answer yes or no. There's a lot of factors that become determinate there, and circumstances surrounding that, that appointment or the unopposed election. If it's truly a democratic area, where there is no opposition and everything is a level playing field, I have no problem with it. When there are other factors, I would say I have a problem with it. It's not an easy, straightforward answer.
Q. You have given me a straightforward answer. I appreciate it. Let me see if I can refine it. There is no per se undemocratic principle that unopposed candidates are duly elected?
A. You're correct.

THE HEARING OFFICER: MR. CARMELL, that is the Constitution. It has been I think in effect for a while. There have been no challenges to

178
that. And that may be standard procedure throughout the labor movement. So whether he thinks it's bad or good is, that may sound nice, but the law is pretty well-established.

MR. CARMELL: That's a very -- that is what surprises me, in which one of the allegations in the complaint is that uncontested nominations is a basis for this trusteeship, and also the fact that offices were filled by, vacant offices were filled by appointment. That is how I read it. I read that. There may be other things to go also. But that is one of them. And I just want to clarify that this is not a problem as he sees it.

MR. BOSTWICK: Well, just to clarify --

THE HEARING OFFICER: That's what he said, that is what he meant, he sees a problem or not. I'm not moved by that.

MR. BOSTWICK: I also don't want a mischaracterization of what he said. He said without more, standing alone and per se, that --

MR. CARMELL: I tried to make that clear. And it is.

179

BY MR. CARMELL:
Q. Are you aware that the uniform District Council -- uniform District Council Constitution does not require the election of officers of the District Council by secret ballot?
A. I can't remember reading that in there.
MR. CARMELL: Well, I refer THE HEARING OFFICER --

THE HEARING OFFICER: I remember that. That's a provision that is in there. It's not a secret ballot.

MR. CARMELL: It doesn't have to be a secret ballot.

THE HEARING OFFICER: Doesn't have to be. Generally the practice throughout this union. It varies. It varies, but it does not have to be.

MR. BOSTWICK: We are certainly willing to stipulate to the provisions of the Constitution if that's what we're doing here.

BY MR. CARMELL:
Q. If I could refer you to 145, so the record is clear because there are circles on it, the persons that Mr. Bostwick has circled have been persons who have been named in documents

180
which we have such as the President's Commission on Organized Crime, et cetera, is that correct?
A. That's correct.
Q. And the only officer listed from 1970 to the present who was within that category was Alfred Pilotto who it looks like is the period 1975 to 1982, is that correct?
A. Per that chart and of the documents themselves, but I think --
Q. That's -- I know what you don't mean to do. I am just asking you because that's what is circled here. From the documents which you testified --
A. Yes.
Q. -- about and that's all that was given to you. There may be more. There may be others. But what you testified to, only Alfred Pilotto was one of the persons. And within the category of select officials, field representatives or delegates were four, Frank DeMonte, Salvatore Gruttadauro, Dominick Palermo and Vincent Solano, is that correct?

181
A. That's correct.
Q. Let me try and tie GEB Exhibit 163 to Exhibit 145. We haven't discussed 163 yet. I'm sorry. That hasn't been discussed yet as far as I know.

THE HEARING OFFICER: That's correct.

MR. BOSTWICK: That's correct.

MR. CARMELL: No, I am not going to.

THE HEARING OFFICER: While it looks like some other chart that you saw on paper this morning. That's the confusing part about that.

MR. CARMELL: Yes, let me just look at those for a moment.

BY MR. CARMELL:
Q. I'm going to do just one local union. I am going to do GEB Exhibit 146, which would be typical of all the other locals so I can attempt, sir, to tie that into GEB 145. Now, on 146 --

THE HEARING OFFICER: That would be Local Union 1.

MR. CARMELL: Yes, Local 1.

THE HEARING OFFICER: Local 1, okay.

182

BY MR. CARMELL:
Q. From 1970 to 1992 Vincent Solano, although we don't know for the full period of time because you have a note there, but at least for a period of time Vincent Solano was the business manager of Local 1, is that correct?
A. Correct.
Q. And as we already discussed by virtue of his being the business manager of Local 1, he became a delegate to the District Council?
A. That's correct.
Q. And to the extent that any of the other persons listed on Local -- on Exhibit 146 were delegates, they would have had to have been elected by the local union membership, is that correct?
A. That's correct.
Q. Now, you testified concerning seven locals who were targets of your investigation, and I am going to skip 1002 because they're out. We have an LN-13 on that. That is Local 1, Local 2, Local 5, Local 225, Local 1001 and Local 1006, is that correct?

183
A. That's correct.
Q. How many delegates do those seven locals have at the District Council at the present time?
A. At a minimum 14. I would have to go and check the exact membership to tell you the exact number.
Q. And at the present time how many total delegates are there of the 21 locals in the Chicago District Council?
A. It's somewhere in the neighborhood I think of 70.
Q. If I told you 90, would that surprise you?
A. No. I think that's correct -- I'm in the ballpark, though, right?
Q. You are. Percentage here, a percentage there. Now, there are approximately 19 -- not approximately -- you testified 19,243 members of the 21 locals, according to the information you had received --
A. Yes.
Q. -- from the International.

184
How many members came from the seven locals?
A. Oh, I didn't break that down. I'd have to go back and take a look at that. I can get that number, but I don't have it at my fingertips.
Q. Do you have any reasonable estimate, not a guess?
A. No, I really don't without looking at the figures and I'd have to add them up.
Q. Mr. Gow, what are the most important leadership positions of the Chicago District Council?
A. Business manager would be the number one most important I'd say of the District Council, then going down the rank order of the Executive Board.
Q. So, the business manager and Executive Board are the most important positions?
A. Yes.

MR. BOSTWICK: Well --

BY MR. CARMELL:
Q. Most important leadership positions?
A. Of the District Council.
Q. Yes.

185
A. Business manager.
Q. Business manager?
A. Yes.
Q. Now, the Complaint paragraph 5 -- throughout refers to three categories, mob members, mob associates and mob relatives. Would you, if you can, define for the purposes of this Complaint a mob member.
A. A mob member would be an individual who would be referred to as a made member of the mob. An associate is a non-made member of organized crime, an individual who works with the particular group. And a relative -- was that the third one you asked?
Q. Yes.
A. A relative would be just as it is, a son, daughter, niece, nephew, something like that, of a person who is identified as a made member.
Q. When you are using the definition of a relative, sir, are you using the definition that would have been used with your experience with the FBI?
A. As a relative?
Q. Yes.

186
A. I guess I am.
Q. Is there any distinction between the definition you are giving now and the definition that is in the EDP of a relative?
A. No, I don't think so.
Q. EDP. I don't know that this fits your definition. I just want to make sure we are all going to be talking about the same thing. It says a relative shall mean a lineal descendent, step-child, ancestor, sibling or spouse or child of a lineal descendent, step-child, ancestor or sibling. Are you aware of that definition?
A. I have read it in the past. I certainly couldn't have quoted it there, but in effect that's what I think --
Q. I couldn't either. From your understanding of this lawyer's piece, is a nephew a relative of an uncle?
A. I would put him in that category.
Q. It's a lineal descendent?
A. Lineal.
Q. Okay. What do you understand the term

187
lineal descendent to mean, if you do understand it at all? I just want to know if you have a view of what it is or if it's ever been defined anyplace that you know of.
A. I have not other than I guess Webster's breakdown of a lineal descendent. This is something in discussion that has not come up before. For the defining of lineal descendent, I would put in someone that is in the lineage of an individual and that would -- I am not explaining this exactly right. But, in other words, a branch off of your family from you to your sister to a someone off there I think would fall in the lineal category.
Q. Doesn't sound like it to me, but that is not what it is. Branches off would be second cousins and third cousins.
A. Well --
Q. All right. So that we know, you know of no policy statement or written definition that had been given to the membership as to what constitutes a lineal descendent?

188
A. I know of nothing other than what you have read out of the EDP.
Q. Now, with respect to Exhibit 145, are all of the persons who are circled there mob members or were they mob members?
A. Yes. Yes.
Q. Were any of them mob relatives?
A. Well, yes. You are talking about circled now.
Q. Yes, circled.
A. Not to my knowledge.
Q. Are any of the uncircled persons on GEB Exhibit 145 are or were mob members?
A. Yes.
Q. Who?
A. James Caporale, John Matassa, Bruno Caruso, Joe Mazza, John Galioto, Jimmy DiForti, Dominick DiMaggio, Joseph Abate, Vincent DiVarco, Craig Kumerow, Nicholas Gironda.
Q. Your testimony is that everyone you named is a mob member, a made member of the mob?
A. Member or associate.
Q. Tell me which ones are mob members, made members of the mob, as you've defined them.

189
A. John Matassa, Bruno Caruso, Jimmy DiForti, Frank Demonte, Joseph Mazza, Vincent Solano, and I believe Dominick DiMaggio. I may be wrong.

THE HEARING OFFICER: On whom? DiMaggio?
THE WITNESS: Yeah.

MR. BOSTWICK: I'm sorry. I didn't hear that last answer.
BY THE WITNESS:
A. I said on Dominick DiMaggio, I take that back.

THE HEARING OFFICER: He is not certain of Dominick DiMaggio.
BY MR. CARMELL:
Q. With respect to Bruno Caruso, what is your source of information or the basis for your testifying that Bruno Caruso is a made member of the mob?
A. Law enforcement sources.
Q. Documents?
A. Yes, documents, witness -- when I say witness statements, cooperating witnesses.
Q. Is Bruno Caruso's name as being a made member of the mob in any President's Commission on

190
Organized Crime report?
A. None that I can recall.
Q. Is he named as a made member of the mob in any Senate hearings or Congressional hearings that you know of?
A. No.
Q. Is he listed as a made member of the mob in any Chicago Crime Commission report?
A. I can't recall with regard to Chicago Crime Commission report.
Q. Let me go through again the basis upon which you make the statement, Bruno Caruso is a made member of the mob. And that is cooperating witness statement?
A. Yes.
Q. Who is the name of the witness?
A. Can I give the names?

THE HEARING OFFICER: Witness is asking a question, editorially. He is asking the question. Is there, Mr. Bostwick, an objection to him answering that question?

MR. CARMELL: If MR. BOSTWICK wanted to object, he would have objected.

THE HEARING OFFICER: No. I don't know if
191
you heard him. He said, can I give that out?

MR. CARMELL: MR. BOSTWICK knows what he wants to object to, Mr. Vaira.

THE HEARING OFFICER: Well, I assume that.

MR. CARMELL: I guess it's out on the table now. So let's go protect all these sources, so that we have no way of knowing who says what.

MR. BOSTWICK: For the record, MR. CARMELL, I don't think that that required -- I will make a statement on this, which is that there are other witnesses that we will produce who are more intimately familiar with the workings. Mr. Gow can testify as to the names of any individuals who gave information, to the extent that he knows them and knows that they are not protected, and knows that there is an ability to give them. If he does not know that information, I guess he will testify to it, but --

THE HEARING OFFICER: Gentlemen, he didn't say that on direct. It just came out on cross. So whatever you get on cross, you know, you get what you're asking. He didn't put him out to say that. I don't think he said that on direct.

192

MR. BOSTWICK: He was not offered as a witness for this purpose. We have other witnesses for this purpose. But if you want to wander into this area, that's fine.

MR. CARMELL: That's fine.

BY MR. CARMELL:
Q. Now, I want to know the names of the people. Let's start first with those that are not in protective custody. Give me the names of the persons who have told -- upon which you base your statement that Bruno Caruso is a made member of the mob.
A. Several former FBI agents, Lee Flossi, Bob Sigalski, Jack O'Rourke.

THE HEARING OFFICER: Go a little slower, so she can hear who you are --
BY THE WITNESS:
A. Lee Flossi, F-l-o-s-s-i, Jack O'Rourke, Bob Sigalski, S-I-G-A-L-S-K-I.
BY MR. CARMELL:
Q. And that those were verbal statements from them to you?
A. Yes. And there are written documents.

193
Q. What are the written documents?
A. Reports and interviews, etcetera. I can't --
Q. From Mr. --
A. I can't give you right now a list of what these documents are. In other words, we have had numbers of meetings discussing these things, and where this has been discussed and brought up verbally based on a number of issues.
Q. Have you seen any law enforcement agent -- have you seen the FBI organized crime reports?
A. Since I've been in this job?
Q. Yes.
A. No, not the organized crime reports.
Q. Have you seen the 1992 organized crime report from the FBI?
A. The public version, I believe we have a copy of it back at the office.
Q. Did you see Bruno Caruso's name in there at all?
A. No.

THE HEARING OFFICER: What's the organized crime report from the FBI? What is that?

194
THE WITNESS: There is a --
MR. CARMELL: It's an exhibit that's coming in, began with the Appalachia and goes through the FBI.

THE HEARING OFFICER: Just so we know what we are talking about. He never mentioned it earlier. I'm trying to catch up.
THE WITNESS: I'm not --

MR. CARMELL: Wanted by the Mob, FBI Organized Crime Report, 25 Years After Valachi.

MR. BOSTWICK: Maybe you could, in fairness, show it to him. That's Exhibit No. 3. It was not introduced through Mr. Gow. He has not talked about it yet. But if you want to refer to it, maybe we should make sure we are not talking apples and oranges.

THE HEARING OFFICER: My question is here, gentlemen, Mr. Gow got up, put some information on, which you are asking about. He obviously has some information other than he testified on direct.
MR. BOSTWICK didn't offer him for that, simply it may be because there are other persons who know better or are closer to it. So if you are getting non responsive

195
answers, he may have to dig up or go back. We are not trying to hold you back. But I don't know if he is prepared for all this. You have the documents that you want to refer to?
THE WITNESS: Yeah. I'd have to go back through this again, in some of the questions he asked me, and do a review. Off the top of my head, I can't give a real definitive answer.

BY MR. CARMELL:
Q. John Matassa, is he listed in any of, your PCOC report that you testified about?
A. The only one that he, that I recall he was listed in, he was listed in as a relative, was in the draft complaint.
Q. Talking about John Matassa.
A. Oh, I'm sorry. I'm going to have to -- I just can't give you an answer without doing some review here. I just can't recall.
Q. Except for Alfred Pilotto, some of the people you have circled down there, and I went through these documents you gave us, gave to
THE HEARING OFFICER, I didn't find Bruno Caruso, I don't find John Matassa, and I don't find a lot of

196
other people that you have named. Does that surprise you?
A. Does it surprise me?
Q. Yes, that they are not named as made members of the mob?
A. Well, no, it doesn't surprise me, based on the sum total of my knowledge.
And I think that this is what, you know, you are going to hear further testimony from other people that will address those factors.
Q. Okay. So you, to your knowledge, though, you don't -- they are not in there, you don't know why they wouldn't be in there?
A. I can't -- no, I don't.
Q. Final question. Is there anything in the EDP that you know of that prevents a relative of a mob member from being, from holding office in LIUNA?
A. No.
Q. Is there anything that you know of in the EDP that prevents a relative of a mob associate from holding office in LIUNA?
A. No. Again, it goes back to the definition and associations here; and if it

197
doesn't meet the standards set out, there is nothing wrong with it.
Q. So, just by being a relative of a mob associate, you are not prohibited from holding any office in LIUNA, isn't that correct?
A. That's correct.
Q. And, finally, being the relative of a mob relative will not prevent you from holding office in LIUNA, is that correct?
A. That's correct.

MR. CARMELL: I have nothing further.

MR. BOSTWICK: I have a few quick clarifications on the chart that
MR. CARMELL was referring to.
REDIRECT EXAMINATION

BY MR. BOSTWICK

Q. Mr. Gow, could you take a look at Exhibit No. 4, please, quickly, that binder.
A. No. 4.
Q. Yes.

THE HEARING OFFICER: The book.
BY MR. BOSTWICK
Q. I'm sorry. I have got the wrong one. Exhibit 5.

198

THE HEARING OFFICER: It's a white book also. It's not here. Use mine.
BY MR. BOSTWICK
Q. MR. CARMELL had said those are the only names on the chart on Exhibit 145, the large blowup, were the only individuals that had been identified in these various public reports as individuals associated with organized crime. And I just wanted to clarify since I erased that exhibit a couple of times that we have in fact added a couple of others. Can you refer to the chart in the back of Exhibit 5.
A. Yes.
Q. All right. Do you see the individuals who are highlighted? There are two Frank Caruso's. Remember we went through this?
A. Yes.
Q. With Frank Michael Caruso, do you see that individual?
A. Yes.
Q. That was marked before. I had actually erased it. I will add that back up there. Do you also see I believe it's page 119 199 of this?
A. Of the second part.
Q. Which is under the tab of the prepared statement of Mr. Hegarty, page 121 is what it was. Page 121. Remember we had gone through that case that we had a little bit of trouble identifying the Hauser matter?
A. Right.
Q. Do you recall that testimony?
A. Yes.
Q. And we had indicated James Caporale, we had circled that name as well.
A. And Al Pilotto.

THE HEARING OFFICER: Alfred Pilotto.

BY MR. BOSTWICK:
Q. And Al Pilotto as well. I am circling these names on the charts. Mr. Gow, one last question. Have you ever done anything in the investigation of any individual as a part of this LIUNA reform process that you felt uncomfortable with because it was directed either by the Government or any International official?
A. No.

200
Q. What would you do if that happened?
A. I'd refuse to do it.
MR. BOSTWICK: No further questions.

MR. CARMELL: Mr. Vaira.

THE HEARING OFFICER: Yes, sir.

MR. CARMELL: If I could have your attention.

THE HEARING OFFICER: I am reading this document. I am listening. I am standing so I can get a little closer to the action.

MR. CARMELL: I would like you to hear the last question and the last answer and tell me whether I am now foreclosed from going into the issues I wanted to that you told me I had to proffer.

THE HEARING OFFICER: I heard the last question.

MR. CARMELL: He asked him is there anything that he has ever done in this investigation that wasn't basically on his own and he said no and I would have quit or resigned, and I now want to test that.

THE HEARING OFFICER: He said anything --

MR. CARMELL: Why don't we -- I did not --

THE HEARING OFFICER: I heard it.

201

MR. CARMELL: I did not phrase it appropriately.

THE HEARING OFFICER: I heard it. I heard the question. Anything that you have been asked -- referred to by the Department of Justice or others that you felt uncomfortable with.
MR. CARMELL: Right.

THE HEARING OFFICER: That is the term, uncomfortable with. I am not sure what that means.

MR. CARMELL: I want to explore what he is comfortable with.

THE HEARING OFFICER: We have referred to that. We are not going to replow this ground. I am not so sure what question it went to and how probative it was. Did you do anything you were uncomfortable with. We covered that. He felt free to go wherever he wanted to go and no one ever told him to do anything else. Assume that they had. The question is here we are in Chicago. We are talking about is there organized crime in this particular District Council and is there or is there not.

MR. CARMELL: No, sir, that is not the

202
question.

THE HEARING OFFICER: That is the main question.

MR. CARMELL: That is not the question that was put to this witness on redirect and it is not the answer that he gave.

THE HEARING OFFICER: Well --

MR. CARMELL: And you are going to let that in, which it is, and you are not going to let me examine, which you won't. Let's leave that go.

THE HEARING OFFICER: Gentlemen, that particular question and answer has about zilch weight to me. That's why I was down here looking at the table and somebody called me and asked me if I really heard that. I heard it. It didn't -- I don't think it's probative of anything. So, gentlemen, let's go on.

MR. CARMELL: Well, then I am going to go on with my proffer now if I can.

THE HEARING OFFICER: Okay.

MR. CARMELL: We don't need him on the stand obviously since you are not going to allow him to

203
answer.

THE HEARING OFFICER: Are you going to proffer what you expected to prove and what he is expected to answer?

MR. CARMELL: I have 15 pages of questions and answers. The answers are very short and the questions are relatively short.

THE HEARING OFFICER: Okay. This goes under the proffer of what you would expect to hear from Mr. Gow.

MR. CARMELL: Right.

THE HEARING OFFICER: Okay. Go ahead.

MR. BOSTWICK: Mr. Vaira, two points of clarification. Will we get a copy of those as the proffer?

THE HEARING OFFICER: I think he is going to put them in the record.

MR. CARMELL: Right.

MR. BOSTWICK: You are going to read them on the record now.

MR. CARMELL: Yes.

MR. BOSTWICK: The second point of clarification is because of the -- because the introduction of the tape was a little out of

204
sequence I can't recall whether we moved its admission with the transcript.

THE HEARING OFFICER: I think you did.

MR. BOSTWICK: I wanted to clarify.

THE HEARING OFFICER: I believe we ruled.

MR. CARMELL: I want to move to strike it because --

THE HEARING OFFICER: Move to strike. Gentlemen, I am not convinced of the probative value of that tape recording and the testimony. I don't know what it connects up with. As I said, other matters I will permit to be introduced into the record. Right now somebody has got to give me some other indication of what that proves. All right. Go ahead. Let's hear your proffer.

Proffer by Sherman Carmell

MR. CARMELL: "Q. Arthur A. Coia was General President since 1993? "A. Yes. "Q. Arthur A. Coia is the son of Arthur E. Coia, who was LIUNA's General Secretary-Treasurer? "A. Yes.

205
"Q. Arthur A. Coia is under investigation at the present time by the Inspector General? "A. Yes. "Q. Arthur A. Coia is fully subject to the EDP including removal for barred conduct? "A. Yes. "Q. Isn't it true that the Department of Justice has stated that it is of the opinion that Coia, Arthur A. Coia, became General President because he was the son of his father? "A. Yes. "Q. Isn't it correct that the Department of Justice is of the opinion that Arthur A. Coia became president -- strike that -- that Arthur A. Coia's father was mobbed up? "A. Yes. "Q. Are you aware of the Department of Justice first draft civil RICO complaint under cover of a November 4, 1994 letter?

206
"A. Yes. "Q. Are you aware that the draft RICO complaint named all of the members of LIUNA's General Executive Board as Defendants in their official capacities? "A. Yes. "Q. Are you aware that that complaint named Coia as a Defendant in both his official and individual capacities? "A. Yes. "Q. Are you aware that the RICO complaint alleged that Coia, quote, 'associated with and been controlled and influenced by organized crime'? "A. Yes. "Q. Are you aware that that complaint alleged that, quote, 'Coia has been associating with the members of the New England LCN family for a substantial period of time'? "A. Yes. "Q. Are you aware that in the complaint Coia was a Defendant in the United States vs. Arthur A. Coia, et al., in the

207
Southern District of Florida? "A. Yes. "Q. Are you aware that the Florida indictment charged that between 1973 and 1976 Coia and his father as officers, agents and employees of LIUNA, quote, 'did knowingly receive, agree to receive and solicit a fee, kickback, commission and a thing of value, that is, money, in the amount in excess of $25,000 from Joseph Hauser and Farmers National Insurance Company because of him intent to be influenced with respect to their actions, decisions and other duties relating to questions and matters concerning the Massachusetts Laborers Health and Welfare Fund'? "A. Yes. "Q. Are you aware that the complaint also alleged that Coia shared the amount greater than $25,000 with, quote, 'co-conspirator Raymond Patriarca'? "A. Yes. "Q. Are you aware that the

208
complaint also charged that between 1973 and 1976 Coia and his father as officers, agents and employees of LIUNA, quote, 'did knowingly receive, agree to receive and solicit a fee, kickback, commission, thing of value, that is, money, in an unknown amount greater than $25,000 from Joseph Hauser and Farmers National Insurance Company with cause of and with intent to be influenced with respect to their actions, decisions and other duties relating to the Rhode Island Laborers District Council Health and Welfare Fund'? "A. Yes. "Q. And are you aware that the RICO complaint alleged that Coia shared the amount greater than $25,000 with, quote, 'co-conspirator Raymond Patriarca'? "A. Yes. "Q. Are you aware that the complaint alleged that the acts by Coia were in violation of 18 USC Section 1954? "A. Yes. "Q. Are you aware that the Joseph

209
Hauser in the Florida indictment is the Joseph Hauser whose declaration is GEB Attorney Exhibit 18? "A. Yes. "Q. Are you aware that the civil complaint alleged that Raymond Patriarca was from at least 1970 until his death in 1984 the boss of the New England LCN family? "A. Yes. "Q. Are you aware that the acts by Coia alleged in the Florida indictment constitute barred conduct as defined in the EDP? "A. Yes. "Q. Are you aware that the first RICO complaint alleged that Coia had conspired to and did unlawfully, knowingly and intentionally engage in a pattern of racketeering activity in violation of 18 USC 1962? "A. Yes. "Q. Are you aware that this allegation constitutes barred conduct by Coia under the EDP?
210
"A. Yes. "Q. Are you aware that the first RICO complaint alleged that Coia had extorted LIUNA membership through force in violation of 18 USC Section 1951? "A. Yes. "Q. Are you aware that this allegation constitutes barred conduct by Coia under the EDP? "A. Yes. "Q. Are you aware that the first RICO complaint alleged that from 1986 to about July 31, 1994, covering a period of time that Coia was general president, that Coia conspired to and did extort money from LIUNA locals in violation of 18 USC Sections 1951 and 1952? "A. Yes. "Q. Are you aware that this allegation constitutes barred conduct by Coia under the EDP? "A. Yes. "Q. Are you aware that the first RICO complaint alleged that from 1986 to

211
about July 31, 1994, covering the period of time while Arthur Coia was general president of LIUNA, that Coia conspired to and did defraud LIUNA locals in violation of 18 USC sections 1341, 1346 and 2? "A. Yes. "Q. Are you aware that this allegation constitutes barred conduct by Coia under the EDP? "A. Yes. "Q. Are you aware that the first RICO complaint sought to have Coia permanently barred from holding any LIUNA office and from participating in any way with the management of any LIUNA entity or benefit fund? "A. Yes. "Q. Are you aware that the Department of Justice representative Coffey, on July 25, 1996, testified before the House Committee that the DOJ believed that the information in the first RICO complaint concerning Coia is true and correct, and that that was under oath?

212
"A. Yes. "Q. Are you aware that as of October 7, 1994, and July 25, 1996, as testified to by Michael Ross, supervisory agent, FBI, before the House Committee, that the FBI was of the opinion that, quote, "Coia is a criminal associate of the New England Patriarca organized crime family," end of quote? "A. Yes. "Q. Are you aware that Coia has an arrest record? "A. Yes. "Q. Mr. Gow, do you confer daily, did you tell the Los Angeles Times on September 12, 1995, that you conferred daily with Coia and the GEB Attorney? "A. Yes.
"Q. Were you present at the House, did you hear the House Committee testimony by Mr. Luskin that the GEB Attorney has taken two depositions of Coia, which the DOJ considered too lenient in questioning?

213
"A. Yes. "Q. Are you aware that Mr. Luskin told the committee that the GEB Attorney was going to take another dep of Coia in early
August, 1996? "A. Yes. "Q. Have charges been brought under the EDP against Arthur A. Coia? "A. No. "Q. Has the General Executive Board Attorney begun proceedings with a complaint for trusteeship over LIUNA? "A. No." That's the proffer.

MR. BOSTWICK: Mr. Vaira, if I can comment on that briefly, for the record, we do not oppose the asking of any of those questions. I can't tell what you Mr. Gow's answers are going to be. I think it's probative of absolutely nothing as a theoretical matter. It is nothing more than if, in the Buffalo trusteeship matter, the attorneys had stood up and said, you haven't yet brought an action against Vince Solano and Bruno Caruso.

214
I don't think it's -- what we are talking about is the Chicago Laborers' District Council. Mr. Gow obviously cannot discuss specific investigations of any individuals, just as he couldn't discuss an investigation of individuals that are part of the Chicago District Council. But as to many of those questions, I would stipulate to some of those answers. As to many of them, I would not. But Mr. Gow is the witness. I simply don't, don't interpose an objection on that.
MR. CARMELL: Excuse me, Mr. Vaira. I missed some questions.

THE HEARING OFFICER: Let me --

MR. CARMELL: I want to finish the proffer.

THE HEARING OFFICER: Gentlemen, I said that I thought this line of questioning was irrelevant to this issue. The issue is, I don't care how many other persons they haven't prosecuted; and if they are going to prosecute, fine. I have also given the rule once before in an election process, election appeal, that the Department of Justice original complaint was not a

215
complaint that was ever filed. It was a working draft. And since that time, a great deal of that complaint has proved, at least in information I've heard, not really trustworthy. And on top of that, the Department of Justice still has that plug in the pool. And if they don't think it's working, then I'm sure they would pull it. So all of that is really irrelevant. I'm here to find out, are these people involved in organized crime. If we are going to hear a case against Mr. Coia tomorrow, then I'll hear it against him. Right now, let's go on with this case. And that's what I'm here to hear. I'm not here to hear a thousand explanations why we haven't prosecuted another 40 other persons out there. All right?

MR. CARMELL: I'd like to ask Mr. Gow --

THE HEARING OFFICER: Go ahead.

MR. CARMELL: -- proffer four questions.

THE HEARING OFFICER: Okay.

BY MR. CARMELL:
Q. Mr. Gow, as Inspector General, is each case carefully reviewed to ensure that all allegations have been aggressively pursued and the

216
matter brought to logical conclusions?
A. Yes.
Q. Is it --

MR. BOSTWICK: Sorry. Is this a proffer or is this --

MR. CARMELL: No. It's a question to him. This directly goes to --

MR. BOSTWICK: I'm sorry. I thought you were still proffering.

BY THE WITNESS:
A. If, could I explain a little bit?

THE HEARING OFFICER: I'm not sure what -- ask him that again.

MR. BOSTWICK: Ask him that again.

THE HEARING OFFICER: I'm not sure what that question meant.
BY MR. CARMELL:
Q. Let me put it another way then. In the September, October, 1995 Laborer, your report, you said, quote, "Each case is carefully reviewed to ensure that all allegations have been aggressively pursued and the matter brought to logical conclusion," end of quote.

217
A. Yes.
Q. You said that?
A. Yes.
Q. That is a fact?
A. Yes.
Q. Still is a fact?
A. Still is.
Q. Is the Inspector General authorized to investigate and prosecute corruption by officers of the International Union?
A. Absolutely.
Q. Is the IG authorized to investigate and prosecute corruption by officers of the District Councils?
A. Yes.
Q. And of the local unions?
A. Yes.
Q. And did you write in The Laborer from May, June, 1995 that your, quote, "mandate is to serve the union member to the best of his ability, and to guarantee a union free of corruption," end of quote?
A. Yes.
Q. Was that true then?

218
A. Yes.
Q. Has it remained true today?
A. Yes.
Q. That's all I have, Mr. Witness.

THE HEARING OFFICER: Gentlemen, I've ruled. I'm taking the offer of proof, but for whatever the questions, and I would take them as if that would be the answer. That is still irrelevant to this proceeding. So let's proceed.

MR. BOSTWICK: I would call --

THE HEARING OFFICER: Okay, Mr. Gow, thank you.

MR. BOSTWICK: I call Mr. Jack O'Rourke. I take it Mr. Gow can be excused.

THE HEARING OFFICER: Yes, he can. (Witness excused).

THE HEARING OFFICER: Mr. O'Rourke.
(WHEREUPON, the witness was duly sworn.) JOHN J. O'ROURKE, called as a witness herein, having been first duly sworn, was examined and testified as follows:

DIRECT EXAMINATION BY MR. BOSTWICK:

219
Q. Mr. O'Rourke, can you state your name for the record, please?
A. Yes, John J. O'Rourke. That's spelled O'-R-o-u-r-k-e.
Q. What is your current employment?
A. I am an inspector with the Office of the Inspector General, LIUNA.
Q. How long have you held that position?
A. Since May of 1996, to the present.
Q. What is the nature of your work for LIUNA?
A. Conduct investigations of corruption and alleged organized crime influence in the Laborers' Union in the Chicago area.
Q. Have you had any prior experience in law enforcement?
A. Yes, sir.
Q. Can you describe that for us?
A. I was a special agent for the Office of Naval Intelligence, at Chicago, in Washington, D.C., for six years. I then joined the FBI and served 26 years, various offices, 23 years in the Chicago office. Upon retirement, in 1995, I became an

220
inspector with the Cook County Sheriff's Office, and was assigned to the FBI task force, and in the FBI offices in Chicago. I resigned that job in May, 1996, and at that point became inspector with the Office of the Inspector General.
Q. In total, Mr. O'Rourke -- well, first, did some of those positions involve the investigation of organized crime in Chicago?
A. Yes, sir.
Q. In total, how many years did you spend in law enforcement, investigating organized crime related activity in Chicago area?
A. I have 32 years as a law enforcement officer, 23 years directly investigating organized crime in the Chicago area.
Q. For clarification purposes, what period of time were you talking about when you are talking about this span of 32 years in organized crime related --
A. I was transferred --
Q. -- investigations?
A. -- transferred to Chicago in 1973, and worked until I retired, and then for a year and a

221
half afterwards, with the task force, primarily engaged in investigating organized crime in Chicago.
Q. Can you estimate for us the number of organized crime investigations you have worked on in this period?
A. Several hundred in that period.
Q. Can you estimate the number of organized crime convictions you played a role in during that period?
A. Either as case agent or as part of a team of FBI agents working the same case, approximately 70, 75.
Q. Did you receive any awards during that period of time?
A. Yes, sir. I received approximately 100 accommodations from the director of the FBI or various law enforcement agencies, and also received an award from the Chicago Chamber of Commerce in 1991 for
excellence in law enforcement.
Q. Have you held any teaching positions?
A. Yes, sir.
Q. What did you teach?

222
A. I was a field police instructor with the FBI, in hostage negotiations, crisis negotiations, criminal psychology, informant development and organized crime cases.
Q. Throughout the hearing, you and other witnesses will be referring to a number of terms. And I'd like to get you at the outset to provide definitions of some of those terms. First thing I would want you to do is take a look at Exhibit 3, if you can. What is this document, Exhibit 3?
A. These seem to be out of order. Here it is. Excuse me. This is a booklet put out by the Federal Bureau of Investigation, on 25 Years After Valachi. It was an informational booklet put out by FBI headquarters to the general public and law enforcement.
Q. Is it a true and correct copy of that document that was distributed by the FBI, describing mob activities?
A. Yes, sir.
MR. BOSTWICK: I move for the admission of Exhibit 3.

223

MR. CARMELL: No objection.

THE HEARING OFFICER: Go ahead. It's admitted, sir.
(WHEREUPON, said document, previously marked GEB Attorney Exhibit No. 3, for identification, was
offered and received in evidence as GEB Attorney Exhibit No. 3.)

THE HEARING OFFICER: By the national, this is by the national office, am I correct? The FBI?
THE WITNESS: Yes, correct.

THE HEARING OFFICER: Public document?
THE WITNESS: Yes, sir.

THE HEARING OFFICER: Okay.

BY MR. BOSTWICK
Q. If I can turn you to the, or refer you to the fourth page -- I'm including the cover page, they don't have numbers on the bottom, but -- my copy doesn't seem to. You see that quote that is in brackets, defining organized crime?
A. Yes, sir, I do.
Q. Could you read the FBI's definition of

224
organized crime?
A. The Federal Bureau of Investigation defines organized crime as any group having some manner of formalized structure and whose primary objective is to obtain money through illegal activities. Such groups maintain their position through the use of violence or threats of violence, corrupt public officials, graft or extortion, and generally have a significant impact on the people in their locals or region or the country as a whole. One major crime group epitomizes this definition, La Cosa Nostra.
Q. Does La Cosa Nostra, to your knowledge, have a code of conduct?
A. Yes, sir, they do.
Q. Can you, is that referenced in this booklet here?
A. Yes, sir, it is.
Q. Can you tell us --
A. It's on Page 6.
Q. Can you describe for us that code of conduct, based on that?
A. Yes, sir. The LCN code consists of, to

225
put the organization above wife, children, country or religion, to follow orders of his captain without question, even to include murder, to furnish no information or help to a law enforcement agency, to pay assessments imposed upon him by his captain, regardless of purpose, to disclose nothing about the organization to outsiders, to respect all members, despite personal feelings, to pay debts owed other members, never to injure, steal from or make disparaging remarks about other members, and to refrain from associating with other members' wives, sisters or daughters, except with honorable intentions.
Q. Are you aware of whether the LCN exists in the Chicago area?
A. Yes, sir.
Q. What role does corruption play in the LCN?
A. Corruption and graft is essential to the operation of the LCN or the Chicago Outfit as it's called here.
Q. In Chicago, where have you found evidence of Outfit corruption in your 32 years in

226
law enforcement?
A. Evidence of corruption exists in Chicago in political corruption, in police corruption, in judicial corruption, in labor unions, with City government and so on.
Q. What methods are used to further corruption?
A. To further corruption, cash, money, bribery, violence, threats of violence.
Q. Does the FBI keep an inventory classifying associates and members of the Chicago Outfit?
A. Yes, sir, they do.
Q. How does the FBI define the term made member of the Chicago Outfit?
A. A made member is an individual who has gone through some form of ceremony and is taken into the organization and is made a member. It indicates he then shares in the profits of the organization and has certain prerogatives, respect paid to him by other members, the ability to have his own crew, to put money out on the street as juice loans, to extort bookmakers and take them under his control and

227
various other prerogatives that nonmembers do not have.
Q. How does the FBI define the term associate of La Cosa Nostra or the Chicago Outfit?
A. An associate is one who works on behalf of a made member of organized crime and there are probably 10 to 20 associate members for every made member, which is kept small. The associate members are individuals who hope some day to be made members of the Outfit. They do the day-to-day tasks, collecting street tax, contacting bookmakers, settling up debts, the regular work of the mob on a day-to-day basis under the direction normally of lieutenants and of bosses who are made members.
Q. Do some of these associates work in businesses or other areas?
A. Yes, sir. Some of the associates would be individuals who are not out actually doing the day-to-day work but who are under the influence and control of organized crime. They could be business owners, bookmakers, individuals in a position -- attorneys, police officers, individuals who are in

228
position to do favors and perform tasks at the direction of organized crime.
Q. What criteria, Mr. O'Rourke, is used by the FBI to put an individual on the inventory of the FBI as a member or associate of organized crime?
A. With regards to a made member, the FBI has rather stringent requirements. The requirements are that two made members who perhaps are picked up on a wiretap discussing a third would be sufficient. A made member discussing in front of an undercover FBI agent with another individual who is a made
member, a third member, would be sufficient. Generally two confidential informants independently who
identify an individual as a made member would be required before they are put on the list as identifiable
made members or suspected made members.
Q. Have you had a chance to review those charts during the course -- not charts -- the inventory, the FBI
inventory, of members and associates of organized crime in the Chicago area?

229
A. Yes, sir.
Q. That's during the course of your 32 years in the FBI?
A. Yes, sir. And of course it's added to and then taken away from as individuals die or become retired or as new individuals are identified and put on the list. So it changes periodically.
Q. Are mistakes made occasionally so that people are in fact taken off if new information arises?
A. If information arises that the individual is not actively involved or is not a made member, of course they are taken off.
Q. And they are added to?
A. And they are added to as information comes in from various sources.
Q. Let me ask you to define a few more terms that you have mentioned already but we haven't defined them. What is --

THE HEARING OFFICER: Before you do, can I clarify a question. Let's go back to associate. Earlier you said that an associate are persons who are

230
working and want to become made members. Later on your definition was they could be persons who would be policemen, lawyers, persons who were working under everyday occupations. Can you explain those two -- sort of conflict there. THE WITNESS: Well, there is a conflict, yes, sir. Some individuals are actively out every day, street tax collectors, enforcers, who are threatening individuals to collect moneys, who are criminals themselves and who aspire to become made members. Other individuals are under the control and influence of organized crime, do their bidding, protect them.

THE HEARING OFFICER: But those persons have no chance of ever becoming a member of the -- a made member.
THE WITNESS: That's correct.

THE HEARING OFFICER: So you gave an example of a Norwegian store owner. He runs a grocery store. Pretty fat chance of him ever becoming a made member of the LCN.

231
If he does the work of them, either reporting or doing something in favor, would you say that person can be an associate?
THE WITNESS: Yes, sir. If an individual is identified as doing the work and associating with organized crime, then the working definition is he would be an associate.

THE HEARING OFFICER: So the persons need not be engaged in illegal activity every day to be an associate.
THE WITNESS: That's correct, yes, sir.

THE HEARING OFFICER: Now, what about this criteria of classifying somebody as a made member? You said that you needed two made members overheard talking about it. You also had one other definition of two confidential sources. Would you explain that, what you mean by two confidential sources talking about it.
THE WITNESS: Yes, sir. Not talking about it. Two confidential sources reporting to the FBI independently of each other that a certain individual is known to them as a made member based on their own membership in organized crime as associates.

232

THE HEARING OFFICER: Okay. In the FBI you have informant, better informants and top echelon informants, some that have never been tested. Do you have some sort of criteria about the quality of the informants who talk about a person before you identify him as a made member, in other words, you get a -- one third level sometimes reliable informant saying that Smith is an organized crime member and then you get another person just like the same -- same level of informant. Would those two informants, half-baked informants, would that be sufficient?
THE WITNESS: No, sir. They would have to be proven reliable informants and individuals who are in fact themselves involved in organized crime, identifiable organized crime activities that have inside information. Two informants, for instance, who would be reporting on cartage thieves and would not have access, that would not be acceptable. Has to be organized crime informants involved in organized crime activities on a day-to-day basis.

THE HEARING OFFICER: Okay. You may go ahead.

233
BY MR. BOSTWICK:
Q. You referred to a few terms as you went along there. I want to clarify their meaning. What is street tax?
A. A street tax is an extortionate collection of money by organized crime. What it involves is a payment by individuals or businesses engaged in illegal activities, chop shops, bookmakers.
Q. What is a chop shop?
A. Chop shop is a salvage yard which specializes in chopping up stolen cars and then selling the parts off on an illegal market. The fact that that's going on and it's illegal would be enough for the Chicago Outfit to send individuals out and collect a monthly tribute from them for allowing them to continue to operate. Could be, as I say -- bookmakers are often the object of extortion street tax collection, porno bookstores, any individual engaged in some sort of illegal activity, prostitution and so on.
Q. What is a juice loan?
A. A juice loan is an illegal loan made to

234
individuals by members of organized crime. The interest -- there is no legal validity. Individuals generally are poor risks. They are generally burglars, gamblers, individuals who have some problem and a need for money. The loans are made out by Outfit loansharks, juice men. The individual has to be vouched for by an Outfit member, is brought to a loanshark. The money is provided and then the juice or the monthly or the weekly payment is generally 5 percent as a rule of thumb. Sometimes 3, but usually 5 percent interest each week.
Q. Each week. How much does that work out to be a year?
A. That would work out to be 260 percent per year interest, and generally it does not come off the principal. That is just the juice or the interest to get the loan.
Q. What occurs if an individual does not pay on their juice loan in your experience?
A. In my experience talking to victims of juice loans they are required to show identification, give their driver's license, provide their home address and other details.

235
Q. Why is that?
A. So that they can be found and the money collected and the threat is very clear at the outset that if you do not pay the weekly juice, the weekly payment, on the loan, then violence can and may then ensue. They can be beaten. They will be threatened, beaten, possibly killed as a result of nonpayment of the loan.
Q. What if an individual who's taken a juice loan doesn't pay. Is there any effect on the sponsor of the individual, the Outfit or LCN sponsor?
A. Yes, sir. Normally the individual who vouches for the loan recipient or the victim is responsible for collection of that money. If the victim or the recipient doesn't pay or flees, then the Outfit member who vouched for them is responsible for paying or collecting the money. The money must come in on a weekly basis and goes up the line to the bosses of the Outfit.
Q. What is a crew or a street crew?
A. Street crew is the lowest level of the organization of the Outfit in Chicago. Historically there have been six or five or six

236
identifiable street crews. It's headed by a boss who usually is assisted by lieutenants on the street who control a number of organized crime associates who do the actual work of collecting moneys, shaking down bookmakers, chop shop owners, collecting whatever moneys, contacting people and so on.
Q. What are some of the -- first, are you aware of some of the crews that have existed in Chicago over time?
A. Yes, sir, I am.
Q. Can you describe for us just a brief overview of what those crews are?
A. Historically there was a south suburban Chicago Heights crew. There was the -- there is the 26th Street Chinatown crew, which has existed since the days of Al Capone, the Cicero crew based in Cicero and the western suburbs, the Elmwood Park crew, the Grand Avenue crew and north side or the Rush Street crew.
Q. You have discussed a little bit in response to Mr. Vaira's question the notion of sources and source information. I'd like to clarify that a little bit further still.

237
What is the definition of a source as distinguished from a cooperating witness or some other individual who gives you information?
A. A source or a confidential informant is an individual who provides information to the FBI on a confidential basis concerning illegal activities and who wishes his identity protected and he does not want to testify in open court because of his fear of retribution.
Q. Where does law enforcement like yourself while you were in the Bureau, where could you get a picture of the identity, structure and workings of the Chicago Outfit?
A. The picture is gathered through convictions of mob members, through prosecutions in Federal Court, through confidential informants' information, through cooperating witnesses who cooperate with the FBI and then testify in Federal Court, subjects to agree to plead guilty and then provide information on their organized crime past and associates, through wiretaps, court authorized Title III wiretaps, through consensual recordings of a victim, witnesses, for instance, paying off juice men or being threatened or even being beaten

238
or undercover operations in which FBI agents are introduced into the organized crime scene by a cooperating witness generally or a cooperating informant and then taken in and recordings are made, surveillances as well.
Q. Have you personally participated in every law enforcement phase that you have just described, surveillances, undercover operations, court cases and the like?
A. Yes, sir, I have.
Q. I'd like to turn your attention now to the structure and leadership of the Outfit in Chicago. Before I do, over the course of your career, have you spoken personally to cooperating witnesses who are actually associates of the Chicago Outfit?
A. Yes, sir, I have.
Q. Can you name a few of those individuals?
A. Yes, I can. Leonard Patrick, Mario Ranone, James Lavalle, Guy Bills, Richard Mara, Nick Geo.
Q. Did you ever speak to a Gerald Scarpelli?

239
A. Gerald Scarpelli, yes, sir.
Q. Are there others that you are not remembering off the top of your head?
A. There are others that I can't recall, yes, sir.
Q. Did you discuss with each of these individuals the identities of other associates and made members of
the Chicago Outfit?
A. Yes, sir, I did.
Q. Let's take one of these individuals as an example. Did Mr. Scarpelli provide you with an overview of the
leadership of the Chicago Outfit?
A. Yes, sir, he did.
Q. Why don't you take a look at Exhibit 49. We will pull that out. Probably easiest if you pull the entire file out because the numbers are in the front, not the back.

THE HEARING OFFICER: Before you mention Mr. Scarpelli, Mr. Leonard Patrick, was he still cooperating with you?
THE WITNESS: No, sir.

THE HEARING OFFICER: Couldn't have now, because you are long gone. When you left was he cooperating?

240
THE WITNESS: He was still being interviewed by the FBI but since that time he's medically been shown to be suffering from Alzheimer's or medically incompetent. So, legally he is no longer able to testify.

THE HEARING OFFICER:
MR. CARMELL, I prosecuted Lenny Patrick. I prosecuted him when I was a federal
prosecutor, having nothing to do with organized crime. It had to do with contempt, refusal to testify, short trial. He just refused to testify and found in contempt. That was it. I was the lead prosecutor. Okay. I have never spoken to Lenny Patrick.
BY
MR. BOSTWICK
Q. Mr. O'Rourke, you got GEB Attorney Exhibit No. 49 before you, is that correct?
A. Yes, sir. That's correct.
Q. The marking there is a little bit confusing. The marking of the GEB exhibit appears at the bottom of the middle of the page. There is also an exhibit sticker at the top of the page. It says Government Exhibit 91. Do you know where this document came from?
A. It was introduced in Federal Court and

241
it was part of a federal judge's ruling in the suppression hearing which was an attempt to suppress the statement, which failed on the part of Mr. Scarpelli's attorney.
Q. What is this document?
A. This is a report of interview, or FD302, Chicago prepared following our interview of Mr. Scarpelli.

THE HEARING OFFICER: Let me ask you a question. Was this, was this in a case in which Mr. Scarpelli was the defendant?
THE WITNESS: Yes, sir. He was the subject of the case.

THE HEARING OFFICER: He was indicted, and there was a motion to suppress this particular document or testimony relating to it as an admission or confession, is that right?
THE WITNESS: That's correct, sir. He was arrested in possession of a machine gun, while en route to commit an armed robbery in Bradley, Illinois. And then that evening, into the morning, we then interviewed him. And this was the result.

THE HEARING OFFICER: And then he was

242
eventually prosecuted. And this document was the motion, the subject of a motion to suppress.
THE WITNESS: That's correct. But he was never prosecuted, because he committed suicide at the federal MCC about one hour after the suppression hearing upheld his statement.

THE HEARING OFFICER: But was he the only defendant?
THE WITNESS: Yes, sir, he was.

THE HEARING OFFICER: This was going to be used or possibly was to be used in case against him, is that right?
THE WITNESS: Against him, and then there were certain other admissions that he made that would have been the basis for additional spinoff investigation.

THE HEARING OFFICER: No, but I mean directly against him at the trial.
THE WITNESS: Yes, sir. That's correct.

THE HEARING OFFICER: Okay, all right.

My Mr.. BOSTWICK:
Q. One further question, if you were to go to the court file, clerk of the court, can you pick this document
up?

243
A. Yes, sir.
Q. In fact, isn't that just what we did?
A. That's correct, yes, sir.
MR. BOSTWICK: I move the admission of Exhibit 49.

MR. CARMELL: On what basis? What is this relevant to?

MR. BOSTWICK: To leadership of the Chicago outfit. We are going to go through this.

MR. CARMELL: Is that what it's for, for the statements of Mr. Scarpelli? I see there are interlineations here. We've got a huge statement here. What are we putting it in for, Mr. Hearing Officer?

THE HEARING OFFICER: Let's go over the first part. It's a huge statement. There is a lot of information in here. I believe that your purpose, this is either original or corroborative evidence of something else, or about the Chicago mob, is what you are saying.

MR. BOSTWICK: Yes. As a matter of fact, we have delineated a couple of short, two or three-page excerpts or selections here which we wanted to have him run through. They relate to

244
individuals on both of these charts.

MR. CARMELL: Well, I haven't had a chance --

MR. BOSTWICK: Pages 6 and 7.
MR. CARMELL: Pages 6 and 7?

MR. BOSTWICK: Is the primary.

MR. CARMELL: Well, so I understand, there is nothing in here that, or does it, that mentions the name of any member -- strike that -- any officer or delegate of the Chicago District Council?

MR. BOSTWICK: That's incorrect.

MR. CARMELL: That's incorrect?

MR. BOSTWICK: Yes.

MR. CARMELL: Then show me where it is, so I can know what I'm doing.

MR. BOSTWICK: I'm not sure why we are doing it this way.

MR. CARMELL: Because this is a statement of a dead person. You are putting it into evidence for what purpose? If it's merely to establish what his view is of the structure of it, I want to know that. But if it's also going in for one of the persons who is, has been an officer, is or has

245
been an officer or delegate, it just becomes a -- tell me where it is, and I can look at it.

THE HEARING OFFICER:
MR. CARMELL, I must tell you that its precedential value in the Teamsters, many, many cases, in the cases involving the trusteeship of the Teamsters, information like this comes in, to be corroborated by other information that may be technically hearsay. So, I mean, as I told you earlier, I will admit this, these documents. But they must be corroborative or structured in such a fashion that other, other items back them up. But let's hear -- I think it's unfair to put all 40 pages in here.

MR. CARMELL: Your view of the Teamsters cases are not accurate, because I've been in them. And they are required to say what part of this document is coming in for what purpose. All I'm saying is, if he is saying it is to show the structure as this person, Mr. Scarpelli, knew it, of whatever you want to call it, it's one thing. I asked him, is there any names of the

246
former members of the Chicago District Council present, so I can see whether those persons are supposed to be part of the structure, or they are just an extraneous, as far as this hearing is concerned.

THE HEARING OFFICER: Well, I agree that there ought to be portions of this that ought to be extraneous; when I see some names of some lawyers I've known in the past floating in and out of here, I don't know if it's meant to be part of this.
MR. BOSTWICK, I see you have some portions of this blocked out.

MR. BOSTWICK: Yes. I can tell you --

THE HEARING OFFICER: That is what you intend to center on?

MR. BOSTWICK: Exactly.

MR. CARMELL: Okay.

THE HEARING OFFICER: You are not intending to -- for whatever purpose you are going to be putting those in, you say they are relevant, the rest of the documents might make interesting reading, but it's those parts are the ones that have relevance to this particular hearing, is that

247
right?
MR. BOSTWICK: Have particular relevance. I would argue that the entire document is corroborative of the structure, the leadership of organized crime. But the items that are bracketed specifically here are particularly relevant to this hearing, and there's only three pages.

THE HEARING OFFICER: In fairness to everybody, including me, at the end of this, I don't want to go wandering through here with a red pen, trying to figure out what is supposed to be relevant. We are going to 1, 2, 3 --

MR. BOSTWICK: Pages 1, Pages 6 and 7.

THE HEARING OFFICER: That is about all.

MR. BOSTWICK: That's it.

MR. CARMELL: Why don't we do, Mr. Vaira, what counsel has already done, which has helped in PCOC and the rest, he took, he only took those pages and put them in. Why can't we just take those pages and put
them in, so there will be no mistake. Hear me out. If he then wants to come

248
back again from another witness on something else, we will have that. I don't like seeing 50-some-odd pages come in and be, and said, we are only interested in three pages. Let's put the three pages in.

THE HEARING OFFICER: Probably what goes before, pages that go after it, give it some context.

MR. CARMELL: I don't like that either. I agree there is going to be some construction on that.

THE HEARING OFFICER: Gentlemen, back here I see Page 7.

MR. CARMELL: Right.

THE HEARING OFFICER: MR. BOSTWICK, if you take the totality of 1 through 7, would that give it some internal integrity?

MR. BOSTWICK: Well, this is, I think I'd say 1 through 9 would give it a little more in terms of consistency. But I'm willing to, the rest is fine. It's, I'm used to having the objection the other way. I'm not trying to excerpt the document. You know, we argue about completeness. But it's fine with me if we want to

249
simply, if everybody wants to tear off the first nine pages, and make that the exhibit, as opposed to have 45 pages of it, I have no problem with that. The only other --

MR. CARMELL: I would have no objection then.

THE HEARING OFFICER: 1 through 9, sir. Go ahead.

MR. BOSTWICK: We can, if my colleague, Mr. Thomas, will write a note on that, we can redo those by tomorrow.

THE HEARING OFFICER: Don't mention it.

MR. CARMELL: We'll do it. We will make copies of the pages, and then it's covered. Thank you.

BY MR. BOSTWICK:
Q. Mr. O'Rourke --

MR. BOSTWICK: Well, I move for admission. I'm not sure if, with that, it's admitted.

THE HEARING OFFICER: Page 1 through 9, we'll admit. (WHEREUPON, said document, previously marked GEB Attorney Exhibit No. 49, for identification, was

250
offered and received in evidence as GEB Attorney Exhibit No. 39.)

THE HEARING OFFICER: What number is this?

MR. BOSTWICK: This is Exhibit 49; it's at the very bottom, the middle of the first page.

THE HEARING OFFICER: I see, okay.

BY MR. BOSTWICK
Q. Mr. O'Rourke, just give us a very brief background on Mr. Scarpelli, and how it was that you came to interview him.
A. Gerald Scarpelli historically was a burglar, armed robber, bank robber, specializing in armored trucks, and jewelry robberies. He became a member of the Chicago outfit and was a hit man, collector and enforcer in part of the Joe Ferriola Cicero crew, at the time of his arrest in 1988. From about '79 until '88, he was a target of an FBI investigation, which I and my partner were case agents. He was dealing with a cooperating witness, who was a former member of organized crime, James Peter Basile, a/k/a Duke Basile.
Q. That was the cooperating witness?

251
A. Yes, sir.
Q. Who was he cooperating with?
A. Cooperating with the FBI.
Q. You in particularly?
A. Myself in particular, yes, sir.
Q. Okay.
A. He wore a concealed body recorder, met with Gerry Scarpelli on a regular basis, over a two-year period, discussing organized crime related matters, loansharking, street tax, and so on. Basile had been part of the collection crew himself prior to that.

THE HEARING OFFICER: Can I stop you? I should have done this before we started. We are going to go into, it looks like you are going to take a little time here with the descriptions of Scarpelli. It's been a couple hours. I think everybody needs a ten, twelve minute, 15 minute break. Let's do that before you get too far into it.

MR. BOSTWICK: 4:15?

THE HEARING OFFICER: That would be fine. (WHEREUPON, a recess was had.)

252

THE HEARING OFFICER: Okay. Sherman. Dwight.

MR. BOSTWICK: Everybody ready to proceed?

THE HEARING OFFICER: Ready to go, sir.

BY MR. BOSTWICK
Q. Mr. O'Rourke, you had just finished describing who Mr. Scarpelli was and how he came -- how you came to speak with him. That information generally is memorialized in the first couple of pages?
A. Yes, sir, that's correct.
Q. Let's turn directly then to page 6 and the highlighted portions there. Do you see that?
A. Yes, sir.
Q. Did you ever in the course of this interview, did you discuss with Mr. Scarpelli the current structure of organized crime in Chicago as of this date, as of 1988?
A. Yes, sir, I did.
Q. Following along with the highlighted portions on both pages 6 and 7, why don't you simply describe for us what he told you and make reference to that as needed.
A. Yes, sir. Jerry Scarpelli was

253
questioned concerning the structure of organized crime. He said that Sam or Samuel Carlisi was the current boss of the Chicago mob as of 1988.
Q. Okay. We have got Mr. Carlisi on this chart, Exhibit 163, is that right? Maybe you need to pull the smaller
chart. I don't want to strain your eyes. It's Exhibit 163.

MR. CARMELL: Mr. Hearing Officer, could we identify what period of time this document is purporting to cover or what time frame or snapshot?

MR. BOSTWICK: Why don't I -- when I introduce it can I lay those foundational questions?

MR. CARMELL: Okay.

MR. BOSTWICK: I just want to refer a little bit to the chart as we go as a demonstrative aid, and then I'll admit it at the end of this portion if that's all right.

BY MR. BOSTWICK
Q. Okay.
A. Yes, sir.

254
Q. You have Exhibit 163 in front of you?
A. Yes, sir, I do.
Q. That is on this Exhibit 163?
A. Yes, it is.
Q. Is that the same Carlisi?
A. Yes, it is.
Q. All right. Continue.
A. He said his former immediate boss, Joseph Ferriola, also known as Joe Negal, was probably the underboss of the mob. He explained that Joe Ferriola was sick with a serious heart disease and had recently been not real active and was expected to die. As a result, Scarpelli stated Ferriola has not been seeing anybody. He advised that he had long been a member of Joe Ferriola's crew which was being presently run by Ernest Rocco Infelise also known as Rocky Infelise.
Q. I am going to stop you there. Joe Ferriola is on this chart as well?
A. Yes, sir, he is. Scarpelli stated that this crew operated in the Cicero, Illinois area, the western part of Cook County and Lake County, Illinois.

255
Scarpelli stated a second crew was headed by James La Pietra, a/k/a Jimmy La Pietra, the brother of Angelo La Pietra and was centered around the old Italian neighborhood at 26th and Princeton Street in Chicago and was referred to by Scarpelli as the Chinatown crew. Scarpelli stated that this crew was headed by Jimmy La Pietra and consists of Frank Calabrese, Ronald Jarrett, presently in federal prison, John Fecarotta, who was murdered last year, would have been in 1987, and a number of others from the neighborhood.
Q. Okay. Now, I will stop you there. We have got the 26th Street crew here and under it it says select members and associates on Exhibit 163. Some of the individuals you just read relating to the 26th Street crew appear on this chart?
A. Yes, sir.
Q. For example, James La Pietra?
A. Correct. Angelo La Pietra.
Q. Angelo La Pietra. And Frank?
A. Frank Calabrese.
Q. But not all?

256
A. Correct.
Q. All right. Go ahead. Continue.
A. Scarpelli disclosed that a third crew was headed by John Di Fronzo, also known as Johnny Bananas, Johnny No Nose, and was centered in the Elmwood Park, Illinois area. Scarpelli stated that the Di Fronzo crew was very tight, very strong, commented that you can't do anything in Elmwood Park without permission. Scarpelli stated that one of the principal members of this crew was Marco Damico, a long time --
Q. Let me stop you there. Marco Damico is on this chart?
A. Yes, sir, he is under others.
Q. Okay. That is Exhibit 163?
A. Correct.
Q. And who is -- who did Mr. Scarpelli indicate that Marco Damico was?
A. He said he was a long-time member of the Chicago crime syndicate and owned several hot dog stands along the north side of the city. Scarpelli stated that Vincent Solano,

257
the president of the Laborers International Union, runs the north side crew and Rush Street. Scarpelli
advised --
Q. Okay. Let me stop you there. We have north side crew on this chart of the Chicago Outfit?
A. Yes, sir.
Q. Select members and associates. Vince Solano appears on that?
A. Yes, sir, he does.
Q. These are in alphabetical order, is that correct?
A. That's correct.
Q. Mr. Solano is highlighted. What is the reason for that?
A. He is highlighted because of his direct association with the Laborers International Union.
Q. The International Union?
A. Excuse me. The Laborers International Union, Chicago District Council and Local 1. He is a delegate to the Chicago District Council.
MR. CARMELL: Just to clarify. That is not what Scarpelli said. It's what Mr. O'Rourke is clarifying.

258

MR. BOSTWICK: That's correct.

MR. CARMELL: Just a moment.

THE HEARING OFFICER: Go ahead.

MR. CARMELL: He did read correctly what Mr. Scarpelli said as being, quote, "president of the Laborers International Union," and the next questions that came were clarification from Mr. O'Rourke, is that correct?

MR. BOSTWICK: That's correct.

MR. CARMELL: Scarpelli didn't make any clarifications concerning this.

MR. BOSTWICK: That's right.

BY MR. BOSTWICK
Q. My clarification, and just so you are clear, Mr. O'Rourke, and then your testimony is clear, is what is the reason that Vince Solano is highlighted? Why is he highlighted on that chart, Exhibit 163?
A. Because of his direct connection with the Chicago District Council and Local 1 of the laborers union.

THE HEARING OFFICER: He mentioned him generically. Mr. Scarpelli mentioned him generically as being associated with the LIUNA

259
wherever he is, and these gentlemen took that generic definition and put it on this chart. I presume that the purpose of this chart is taking information other persons have given to him, taking and putting a yellow marker on.
MR. BOSTWICK: That's right.

THE HEARING OFFICER: Okay.

BY MR. BOSTWICK:
Q. Then you were continuing about another crew?
A. Yes, sir. Scarpelli advised that this crew was headed by Albert -- let's see -- that this crew was headed by Albert Caesar Tocco, a/k/a Al Tocco, and runs the south Chicago suburbs, Chicago Heights, Calumet City and parts of Lake County. Scarpelli referred to this as the Chicago Heights crew and identified Al Tocco as the boss of this crew. Scarpelli stated that he knows Albert Rosetti, Michael Guzzino and a few other members of this crew but is not too involved familiar or involved with the Tocco crew.

260
Q. We have got Mr. Tocco, Albert Tocco, down at the bottom of the others section on Exhibit 163, is that
correct?
A. Yes, sir, correct.
Q. And Gerald Scarpelli actually appears there as well?
A. Yes, he does.
Q. And I believe you mentioned Michael Guzzino, but we have a Nicholas Guzzino there?
A. Yes.
Q. But that is not the Michael that you just referred to, right?
A. I believe it was meant to be Nicholas, but it was -- he said Michael.
Q. Okay. Well, in other words, that is not the Michael that we have put up there. We have put -- Nicholas Guzzino is not on this chart because he is referenced in here as Michael?
A. This was from the interview and the notes at the time. Michael Guzzino.
Q. Fine.
A. There is one more.
Q. One more little portion down there at the bottom.

261
A. With regards to the Grand Avenue crew, Scarpelli stated that this crew was previously run by Joseph Lombardo, a/k/a Joey the Clown Lombardo, who was convicted of racketeering at Kansas City Missouri, and was presently serving a lengthy federal prison sentence as of 1988.
Q. Did you also indicate that James Marcello at the bottom -- do you see that?
A. Yes, sir. Scarpelli advised that James Marcello, also known as Jimmy Marcello, was also a boss in the Outfit and was very close to Black Sam Carlisi, who was then the boss of the Chicago family.
Q. There is a James Marcello on this chart as well?
A. Yes, sir, he is.
Q. Under the others section in Exhibit 163?
A. Correct.
Q. Mr. O'Rourke, did Mr. Scarpelli admit to criminal conduct in the course of his interview with you?
A. Yes, sir.
Q. Conduct related to organized crime?

262
A. Yes, he did.
Q. Very briefly what was the nature of those admissions?
A. He admit -- he admitted his involvement in four murders, organized by or ordered by organized crime bosses. He admitted involvement in beatings, extortion, shake-downs of individuals and planned robberies of an armored truck, a planned robbery that he was arrested for, and possession of a submachine gun.
Q. Those are not described, those murders and that activity is not described in the first ten pages but in the pages that we are not going to use as part of the exhibit, is that correct?
A. Yes, sir, that's correct.
Q. Mr. O'Rourke, who is Richie Mara?
A. Richard Mara, Richie Mara was a former resident of the 26th Street neighborhood, a member of the 26th Street crew. He was a burglar, armed robber, cartage thief, jewelry robber, who operated in the 1960s and 1970s.
Q. Did Mr. Mara testify in any federal criminal trial relating to organized crime?
A. Yes, he did.

263
Q. Do you recall which ones?
A. Mr. Mara testified in a theft interstate shipment case in federal court. And he may have testified in other federal organized crime cases. I do not recall now.
Q. Of the ones you recall, was there, were there convictions that resulted from, in part, from his testimony?
A. Yes, there were.
Q. Do you recall how many?
A. At least one, and possibly others. He was cooperating witness in a case in which he was a subject. And because of his cooperation and testimony, all of the defendants in that case entered pleas of guilty before the trial.
Q. Do you recall how many pleas of guilty there were?
A. Yes. Anthony Gallichio, Gerald Shallow, Jeffrey Paul Ater, three, and Richard Mara, four.
Q. Can I refer you to Exhibit 78?
A. Yes, sir.
Q. You can put that back. We are done with the Scarpelli exhibit.

264

MR. CARMELL: What number was that?
MR. BOSTWICK: 78.
MR. CARMELL: 78?
MR. BOSTWICK:
Yeah.

THE HEARING OFFICER: What period of time was Mara cooperating witness, Mr. O'Rourke?
THE WITNESS: Late 1970s through early 1980s, Mr. Mara.

THE HEARING OFFICER: He has dropped out since that time?
THE WITNESS: He entered the witness security program, yes.

BY THE WITNESS:
A. What was the -- I'm sorry.
BY MR. BOSTWICK
Q. Exhibit 78. Mr. O'Rourke --

THE HEARING OFFICER: 78, go ahead.
BY MR. BOSTWICK
Q. Do you recognize this document?
A. Yes, sir. I do.
Q. What is it?
A. It is a report of interview, prepared on September 17th through 25th of 1980, by a special agent Ray Shryock, of Richie, who was

265
actually Richard John Mara, the cooperating subject.
Q. Did you have personal interviews and contact with Mr. Mara relating to the structure and workings of organized crime in Chicago?
A. Yes, sir, I did.
Q. Does this 302 accurately reflect the types of information that he provided to you?
A. Yes, sir, it does.
Q. What is the date on that 302?
A. September 17th through the 25th, 1980. There were several days of debriefing.
MR. BOSTWICK: I'd move admission of Exhibit 78.
MR. CARMELL: One second, please. Is this basically for the highlighted part?

MR. BOSTWICK: That's exactly right. It's a five-page document.
MR. CARMELL: For the purposes you stated, no objection.

THE HEARING OFFICER: You may go ahead, with that admission. (WHEREUPON, said document, previously marked GEB Attorney Exhibit

266
No. 78, for identification, was offered and received in evidence as GEB Attorney Exhibit No. 78.)
BY MR. BOSTWICK
Q. I'd ask you to refer, if you can, simply to the -- you can read it, if you wish, but if you want to summarize that information based on what Mr. Mara told you, that's fine. I'd just like for you to relate some of the individuals that he told you about as being members of the organized crime structure here in Chicago.
A. Yes, sir. First paragraph: Joseph Aiuppa was the boss of the Chicago mob. Jackie, he is, the last name, Jackie Cerone, was the underboss. Tony Accardo was definitely retired, but was still a consultant in part of the inner circle. Gus Alex, Butch Blasi, Bruno, an attorney, and Pat Marcy are also part of the inner circle. Gus Alex has long been known as the one in charge of loop activities. Butch Blasi is troubleshooter for Joey Aiuppa and Tony Accardo. Bruno, the attorney, is Accardo's attorney.

267 Pat Marcy is the biggest fix man political influence for the mob.
Q. Let's just clarify that, so there are no misunderstandings. We have a Bruno Caruso up there. The Bruno referred to there has nothing to do with that?
A. No, sir. It does not. He is a now deceased Chicago attorney who was a long time attorney for Tony Accardo.
Q. That is the last name, that's Bruno?
A. His last name is Bruno, yes, sir.
Q. Who is Marcy?
A. Marcy is a Pat Marcy, now deceased, who was the former ward committeeman of the first ward in City of Chicago, who died prior to his trial on racketeering and corruption activities.
Q. Was this information provided before Mr. Marcy was indicted?
A. Yes, it was.
Q. A number of those names, I would go through them, but are up on this chart, is that not correct?
A. Yes, sir, that's correct.
Q. The chart meaning Exhibit 163, okay.

268
Go ahead and continue about the --
A. Mara stated there were four crews operating in Chicago area, Grand Avenue crew, headed by Tony Spilotro, and run by Joey Lombardo, as Spilotro oversees the Chicago mob's interest in Las Vegas.
Q. Let me stop you there, clarify that as well. We also have a Joe Lombardo, Junior up there. Is it your understanding from your discussions with Mr. Mara that that's Joe Lombardo, Junior or Senior that we are
talking about here in this 302?
A. He was referring to Joseph Lombardo, Senior, the father of Mr. Lombardo.
Q. Okay. Go ahead and continue.
A. 26th Street crew or south side crew was headed by Angelo LaPietra. Strongest crew is the Taylor Street crew, headed by Joe Ferriola, the mob's chief enforcer. The Heights area, or the Chicago Heights area, was controlled by Al Tocco. Pilotto was Al Pilotto, was told to retire. Pilotto is now only involved in labor union activities, and is not an active boss anymore. He knows well what happened to Cataura, which is

269
James, Jimmy "The Bomber" Cataura, who was murdered when "The Bomber" refused to retire.
Q. Let's stop there and explain that a little bit, from your conversation with Mr. Mara, if we can. First of all, Al Pilotto, he is on this chart, is he not?
A. Yes, sir, he is.
Q. Under here, under this selection of others?
A. Correct.
Q. And again, why is he highlighted in bold on the chart that is marked as Exhibit 163?
A. He is highlighted in bold, because he was in charge of the Local 5 of LIUNA, Chicago Heights, for many years, and was convicted of labor related racketeering charges in a trial in Miami, Florida back in 1984.
Q. Did he also hold a position in Chicago District Council?
A. Yes, sir, he did. He was a delegate, and he was the coordinator of committees.
Q. I believe you got that wrong. But that's, the record is going to reflect his position. Are you certain that he was involved in

270
Chicago District Council?
A. I believe that he was, as a delegate. I could be mistaken.
Q. Mr. O'Rourke, what does this, it says in 302 here, he well knows what happened to Cataura, when "The Bomber" refused to retire. What does that refer to?
A. Informant information, provided to me, and as well as review of FBI files and Chicago police files at that time indicated that James, known as Jimmy "The Bomber" Cataura, was an old-time mob boss operating in 26th Street, Chinatown area. He was told to retire by representatives of organized crime. Reportedly he refused to do so. And he was then found shot to death around Western and Hubbard Avenue on the near north side of Chicago in the Grand Avenue neighborhood by mob hit men; discovered by police. The murder has never been solved.
Q. Okay. And why don't you continue. We don't need any more on that page. Why don't you continue on Page 3.
A. Yes, sir.

271
Q. The portion that refers to the south side crew.
A. Mara stated that Angelo LaPietra is the boss of the south side crew. His two enforcers are Ronnie Jarrett and Frank Calabrese. Jarrett handles juice for Angelo LaPietra. Two additional individuals with LaPietra's crew are Angelo and Anthony Imperato. Anthony, also known as Toburk, is not a made guy. Angelo Imperato, also known as Durgie Imperato, is a made member, handles mostly gambling for LaPietra. James Cordovano is made, and handles gambling and juice. Jerry Scalise and Gerry Scarpelli are also part of LaPietra's crew. These two have been operating on the far south side with Tocco's group. Skid Caruso is now retired. His enforcers were Joe LaMantia and Poopy Meenzy, Skid's area. Chinatown has been given to LaPietra.
Q. Okay. Let me ask you questions about that, before we turn the page. Did Gerry Scarpelli, is that the same Gerry Scarpelli which we just referred to in the previous exhibit, who you interviewed?

272
A. Yes, sir. It is.
Q. And this is information being provided some years before he spoke to you and delineated his involvement in --
A. Correct, 1988, following his arrest. This interview occurred in fall of 1980.
Q. Skids Caruso, who is referred to at the bottom of the page, does he have any relationship that you are aware of with any of these individuals that are on that Chicago Laborers' District Council chart which is marked as Exhibit 145?
A. Yes, sir. Frank Tony Caruso, known as Skids Caruso, is the father of Bruno Caruso, and Frank Michael Caruso, also known as "Toots" Caruso, and he is the uncle of Leo Caruso, and he would be the brother-in-law of Fred Roti, an alderman from the first ward.
Q. How do you know that?
A. I know that from review of FBI files, Chicago police files, interview of informants, interview of cooperating witnesses, such as Richard Mara, over the years, interview of Mr. Bruno Caruso and Leo Caruso in the course of the

273
IG's inspection process.
Q. Okay. These individuals, some of these individuals, let's just talk about the one here, Frank Tony Caruso, that's the individuals identified --
A. Yes, sir.
Q. -- highlighted portion on Exhibit 163, Frank Tony Caruso is Skids Caruso?
A. Frank Tony Caruso is Skids Caruso, now deceased.
Q. Okay. Why don't you continue on Page 4.
A. With regards to Chicago Heights or south suburbs crew, Mara stated that Al Pilotto is supposed to have been told to retire because of his age; can still be active in labor matters, but not in the day-to-day operation of the Heights. Tocco is the current street boss. However, Ferriola has sent Rocky Infelise to the Heights to help Tocco run the operation. With the --
Q. Okay. Let me refer you down there to the Grand Avenue crew. Just read the first paragraph there. I want to ask you a question

274
about it.
A. Yes, sir. Tony Spilotro is boss of the north side crew. However, since he is in Las Vegas, Joey Lombardo was the street boss. Supposedly, Joe DiVarco and his group are part of the Grand Avenue crew. Vince Solano was a made guy, but handles only labor matters for the mob. He is not a street boss of day-to-day operations. Q. Okay. The reference to Joe DiVarco, there is a Vincent DiVarco on the Chicago District Council Laborers' chart, which is Exhibit 145. Do you see that?
A. Yes, sir, I do.
Q. Is that any relation?
A. He is the son of Joseph Vincent DiVarco, also known as Caesar DiVarco, who died years ago.
Q. We have not -- would you like to clarify something you heard earlier today, with respect to Vincent
DiVarco, that Mr. Gow testified to?
A. Yes. I believe Mr. Gow mistakenly believed that Vince DiVarco, who is the son and

275
who was 9 years old or so when his dad died in prison, was identical to the individual on the chart or individual mentioned here. Actually, Vince DiVarco is the son of the person Joseph Vincent DiVarco, or Caesar DiVarco, which is mob boss in charge of Rush Street back in 1980s.
Q. We refer you to page 5. And I want you to read those portions if you would.
A. Yes, sir. With regards to corruption, Mara stated that John D'Arco's son, John D'Arco, Junior, is the law partner at Robert Cooley, Greco's Restaurants, which is located on the south side of 95th Street in Evergreen Park, according to Mara, was bankrolled by Cooley. Pat Marcy, he stated, was the biggest fix man in Chicago. He and John D'Arco handled all major political problems for the Chicago mob.
Q. Let me -- well, go ahead. Continue on.
A. He stated that Alderman Roti, which would be Fred Roti of the first ward, has a sister who is married to Skid Caruso; that would be Frank Tony Caruso. Roti's son was recently indicted by

276
a federal grand jury in the motor pool fraud case.
Q. On the corruption angle here, are you aware of who John D'Arco and Pat Marcy and Alderman Roti are?
A. Yes, sir, I am.
Q. Were any of those individuals indicted sometime after the -- your discussions with Mr. Mara in the early 1980s?
A. They were indicted I believe in the 1990s. Pat Marcy was indicted for racketeering and corruption but died before his trial could commence. Fred Roti went on trial, was convicted and was recently released from federal prison and is back home in the Chinatown area of Chicago on federal parole.
Q. Are you aware of any relationship between the Fred Roti you are just referring to and any of the individuals on the Chicago Laborers District Council chart?
A. Yes, sir. Fred Roti would be the uncle of Bruno Caruso and Frank Toots Babe Caruso and he is also related to Leo Caruso, all of whom are officials of the LIUNA Chicago District Council or

277
were.
Q. For the record we are referring to Exhibit 145 with that question?
A. Yes, sir.
Q. Mr. O'Rourke, are there other cooperating witnesses and sources that you have spoken to about the leadership and structure of the Chicago Outfit over the course of time when you were in the FBI?
A. Yes, sir.
Q. Have you heard reportings that corroborate your understanding of structure in the Outfit?
A. Yes, sir.
Q. Now, I'd like for you to take a look at this Exhibit 163, which has been blown up, and I'd like to ask you to describe that in a little more detail, how that was prepared.
MR. CARMELL: Are we going to break soon?

MR. BOSTWICK: As soon as we get done with this. It will be about -- just a few more questions.

THE HEARING OFFICER: Sure.

MR. BOSTWICK: To finish the chart.

278
BY MR. BOSTWICK
Q. Mr. O'Rourke, is this a list of all Outfit members that you are aware of in Chicago?
A. No, sir. It's not.
Q. Why are -- does it relate specifically to a certain year?
A. No, it does not.
Q. Why is -- why are these individuals -- why have these individuals been selected to be put on this chart?
A. The individuals selected have a direct relationship to the Chicago District Council, to LIUNA individuals currently on the Chicago District Council or are mentioned in the course of this investigation and in this hearing that will be discussed and described by myself and in further witnesses appearances.

THE HEARING OFFICER: When was this prepared, Exhibit 163?
THE WITNESS: I don't know the exact date, Mr. Vaira. It was prepared --
BY MR. BOSTWICK
Q. Prepared in preparation for this hearing?

279
A. Preparation for this hearing, within the last several months, last couple of months.

THE HEARING OFFICER: There have been some changes then I take it. Anthony Accardo is dead, is he not?
THE WITNESS: Yes, sir. This is not a current list of people that are necessarily alive. These are historical as well as current people together.
BY MR. BOSTWICK
Q. In other words, is it fair to characterize this as a list of names of individuals associated with the mob that will come up repeatedly in the hearing as associates of people in the District Council, close associates of people in the District Council or people who are actually in the District Council?
A. Yes, sir, that's correct.
Q. So, it does not, just to clarify again, it does not -- it's not a chart of a snapshot of the Chicago District Council -- I'm sorry -- the Chicago Outfit on a given year or given date?
A. That's correct, yes, sir.
MR. BOSTWICK: I would move admission of this

280
chart as a helpful tool and aid throughout both Mr. O'Rourke's questioning and the questioning of other individuals.

THE HEARING OFFICER: Gentlemen, you continue to use the chart and if the parts of it are sustained or usable, fine. I have a little reluctance in putting in charts. As I learned in Buffalo, we put up charts and sometimes the witnesses come later and take the charts apart. So, it's for our instructional purpose only. So you can see if you want to scratch on it, do whatever you want to. In other words, it is a continually evolving teaching aid. All right. But we will have to call it something. We will call it what you called it, 163.

MR. BOSTWICK: Fine. And that is a very logical breaking point for me, Mr. Vaira. If that's okay.

MR. CARMELL: That will be fine for us too.

THE HEARING OFFICER: Okay. Now, gentlemen, what time did you say you wanted to start tomorrow?

MR. BOSTWICK: 9:00.

281

MR. CARMELL: 9 a.m.

THE HEARING OFFICER: Okay. See you tomorrow then and get a good day's work in and I know that your clients have to have a meeting this evening.

MR. CARMELL: Right.

THE HEARING OFFICER: Thank you. (WHEREUPON, at 4:50 p.m. the hearing was adjourned until Thursday, July 17, 1997, at 9:00 a.m.)

282
STATE OF ILLINOIS ) ) SS:
COUNTY OF C O O K ) I, CORINNE T. MARUT, C.S.R. No. 84-1968, and MARY KAY BELCOLORE, CSR
No. 84-1813, Certified Shorthand Reporters of the State of Illinois, do hereby certify that we reported in shorthand the proceedings had at the hearing aforesaid, and that the foregoing is a true, complete and correct transcript of the proceedings of said hearing as appears from our stenographic notes so taken and transcribed under our personal direction. IN WITNESS WHEREOF, I do hereunto set my hand at Chicago, Illinois, this day of , .

CORINNE T. MARUT, C.S.R. No. 84-1968 Certified Shorthand Reporter

MARY KAY BELCOLORE, C.S.R. No. 84-1816 Certified Shorthand Reporter C.S.R. Certificate No. 84-1968.

283
I N D E X WITNESS DX CX RDX RCX EXAM W. DOUGLAS GOW
BY MR. BOSTWICK
25 152 197
By MR. CARMELL 111 154 JOHN J. O'ROURKE
BY MR. BOSTWICK

218

E X H I B I T S NUMBER RECEIVED GEB Exhibit No. 1 41 No. 2 47 No. 3 223 Nos. 4 and 5 82 No. 49 249 No. 78 265 Nos. 118 through 125 57 Nos. 145 through 152 63

Laborers for JUSTICE (c) 1997 All Rights reserved Obtained by Jim McGough at his expense, converted to html, and supplied to Chris White for temporary publication on www.laborers.org

IPSN  1997-2006 All Rights reserved. Not for republication on the internet without permission. 
webmaster