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Pete Wacks, Retired FBI Special Agent  (Picture)
Chicago Office -- Mob/Labor Union Specialist

It was a reliable rule of thumb in years past, that the only way an FBI agent gained information to build a successful criminal case was through the cultivation of informants. To succeed in this most highly visible agency within the federal law enforcement bureaucracy, FBI men observed a practiced ritual.

“Agents did not go undercover - they developed informants,” recalls Peter Wacks who retired this past month after logging thirty years as a specialist in organized crime’s penetration of labor unions.

“Today you still have to develop your sources but now you go undercover. That whole process of working a case from the inside out began during the Vietnam era with a minimal amount of guidelines and supervision coming from above.”

Thirty years ago when Special Agent Pete Wacks reported to the Chicago field office after completing a tour of duty in Jacksonville, Florida where he investigated bank robbery cases, J. Edgar Hoover’s FBI was a different entity than today. There was a lot less cooperation with local law enforcement, fewer women and minorities, and drug trafficking had not yet come to the fore.

The emphasis on organized crime became more focused in the 1960s, following the remarkable showdown between the late Robert Kennedy and Jimmy Hoffa, when the powerful Teamster leader was interrogated at length by the Attorney General over his union’s ties to organized crime. “This freed up some resources that allowed us to investigate certain individuals right here in Chicago,” Wacks said.

“I got into the labor cases through assimilation and exposure,” he adds, “and by virtue of Joey Lombardo and Allen Dorfman.”

Pete Wacks was one of six Chicago-based agents assigned to the Pendorf (the codename for “Penetrate Dorfman”) and Strawman investigations probing the links between the Chicago and Kansas City mobs and the pillaging of the Teamsters Union Central States Pension Fund.

Allen Dorfman, a natty dresser whose appearance belied a stone-cold disposition, was an ally of the late Jimmy Hoffa. As a personal favor to Paul Dorfman, Allen’s step-father was given control of the gigantic Central Conference of Teamsters Welfare Fund Insurance by Jimmy Hoffa in the 1950s. In return Paul Dorfman provided Hoffa with the necessary introductions to key figures within the Chicago mob hierarchy.

Mob money, drawn from the Teamsters pension fund, financed 85% of the casino hotels that appeared on the Las Vegas Strip in 1978-1979, according to Wacks, had worked the Chicago end of the case with Kenny Holt, Dick Houston, Doug Ludvigsen, Art Pfizenmayer, and their supervisor Jim Wagner. Ludvigsen and Wagner are the only members of the original team still active in the FBI.

The extensive use of FBI wiretaps helped send Joey Lombardo, Jackie Cerone, and Joey Aiuppa, the elder statesmen of the Chicago outfit, to prison for their part in the “skimming” of the mob-fronted casinos.

Allen Dorfman was savagely gunned down outside the Lincolnwood Hyatt Hotel in the presence of Irwin Weiner, another reputed organized crime figure who stood trial with Dorfman in 1975 for defrauding the Teamsters Central States Pension Fund. Weiner barely flinched as two masked gunmen pumped six shots into Dorfman’s head.

The case is as fresh today as it was in January 1983 when Wacks received notice that the bureau’s old adversary was dead. “The majority of my responsibility these last twelve or so years has been tracking Pendorf-related developments for prosecutors around the country. It still has life.”

“Strawman and Pendorf not only dealt a serious blow to the mob but they really changed the focus of wiretaps,” Wacks adds. “In the early 1970s this kind of surveillance was directed mostly against bookmakers. But then the interest in gambling operations waned, and its usage was extended to mob figures in related schemes, such as their activities in Las Vegas.”

FBI wiretaps probably saved the life of former Teamsters President Frank E. Fitzsimmons, a bland and unimaginative union boss who succeeded Hoffa in 1971. At one point the usually cooperative Fitzsimmons was adjudged a “liability” by his organized crime sponsors.

Pete Wacks was present for a meeting between Fitzsimmons, his attorney, and FBI agents at a Washington D.C. law firm. “Frank was a good poker player - he offered no running commentary when we advised him that his life was in eminent danger. About three days later Fitz reported back to us that he had looked into the matter and found that it was no longer a problem,” Wacks relates. “We surmise that he had checked in with someone on the other side.” Frank Fitzsimmons died of lung cancer in 1981.

Civil RICO prosecutions in the late 1980s and early 1990s crippled the unions most often linked to organized crime. The Hotel and Restaurant Employees International Union, the Laborer’s International Union, and the International Brotherhood of Teamsters have operated under federally imposed consent decrees for much of the decade. “Our investigations spun out of the President’s Commission on Organized Crime,” he explains. “A consent decree is a contract. For that decree to have life or value it has to be enforced in court.”

Between 1989 and 1996, 41 Chicago-area Teamster leaders including William Hogan, Jr. of Local 714, Donald Peters of Local 743, and Dominick Senese of Local 703 were removed or suspended from their posts. Officials from various other Teamster Locals including 777, 726, 705, 710, 738, 727 and 786 were ousted as a part of the nationwide clean-up effort engineered by Teamsters International President Ron Carey, and the federally appointed Independent Review Board.

There is still a long way to go, Wacks concedes.

“The Teamsters have made progress since 1989 when they settled a racketeering suit that paved the way for the consent decree, but the problem today is the backfill - there are young guys coming up that we do not have information on. The fact that the Office of Investigation is still in business indicates a lingering problem.”

It is common practice for labor officials with mob backgrounds to “flip” from the union under investigation to another that may not be undergoing the same intensive federal scrutiny.

Apathy among the rank and file breeds complacency and invites mob infiltration. “Let’s say you have a group of people working 40 or more hours a week and the paycheck always arrives on time. They don’t care how that union is being run just so long as they have their insurance and their benefits and a yearly vacation. For them a union is just a vehicle to get and keep employment,” Wacks states.

“Union members can be very lethargic when it comes to attending meetings and monitoring what is going on inside that Local. Very often a meeting of the Local becomes just another drinking bout.”

Union pension funds remain vulnerable to organized crime plunder. “The money is in the manipulation of these retirement funds,” Wacks said. “Money is leverage.” Pete Wacks is one of the few remaining agents left in the Chicago office who is well versed in labor racketeering. For the past five years he has been working on the Laborer’s Union investigation.

The mandates filter down to the bureaus from the U.S. Attorney General, and in light of the 1995 Oklahoma City bombing, the focus these days is geared more toward domestic and international terrorism. That means that the priorities are constantly re-arranged by Washington. “When you move down the list, a labor racketeering investigation ranks maybe six or seven on a sliding scale,” he adds.

The ever changing face of Chicago organized crime leaves local mob watchers puzzled and groping for answers to the common question being asked these days: who’s really in charge? Death and prison have depleted the Chicago outfit of its “old guard” leadership. Within the past year Sam “Wings” Carlisi, Joey Aiuppa and Jackie Cerone cashed in their chips, leaving behind a power vacuum within the hierarchy.

Almost everyone who harbors a particular interest in the outfit it seems, has their own pet theory concerning the struggle for succession. Names like Joey Lombardo, John “Apes” Monteleone, and John “No Nose” DiFronzo (recently released from prison) bubble to the top of the mob rumor mill. This wise guy is in, that wise guy is out. And so it goes.

While there is still no convergence of opinion with respect to the identity of Chicago’s “number one boss,” Pete Wacks and others in the know share the belief that it is probably Joey Lombardo who has stayed well out of sight since his release from a federal penitentiary in December 1992. Lombardo served a portion of his concurrent 15 and 16-year sentences for bribery, conspiracy, wire fraud, and conspiring to skim $2 million dollars from Las Vegas casinos. Upon his release from prison, Joey served public notice in the Chicago Tribune classified section that he was “crime free.” He disavowed his mob connections and has kept a low public profile ever since.

“I never took a secret oath with guns and daggers, pricked my finger, drew blood or burned paper to join a criminal organization,” the ad read, in part.

Maybe not, but Pete Wacks is convinced that the man the media dubbed “the Clown” in the 1960s is still a major player in the nineties. “Joey was a very funny man - he truly was, but he is also very crude and he often dresses like a bum. Lombardo is not an educated person, but he is very cunning and street smart,” Wacks recalls. “At some point during the trial in Chicago he lost his sense of humor.”

Wacks’ dealings with the infamous Mr. Lombardo date back to 1974 when Daniel Seifert, a government witness who owned a Bensenville plastics firm, was gunned down in the presence of his wife by mob assassins. Seifert was to have been a witness for the government in a case against Lombardo, Anthony Spilotro, Irwin “Red” Weiner, Ronnie DeAngelis, Allen Dorfman, and others in the opening rounds of the decade-long Central States Pension Fund case. Reportedly, Seifert provided detailed information about “Milwaukee” Phil Alderisio’s hidden ownership of International Fiber Glass Company in Elk Grove Village. Alderisio, a feared mob assassin was an associate of Lombardo. The fiber glass company was torched in February 1973.

Without Seifert’s testimony, the case against Lombardo and his associates weakened and eventually all the defendants were acquitted. “Seifert possessed the necessary skills to run a successful business. He set up the molds and was the kind of straight man with the technical know how that mob figures cultivate when they infiltrate a legitimate business.” Wacks relates. “But Lombardo was the silent partner. After Seifert was killed there just wasn’t enough evidence to bring the case to the grand jury stage.”

In retirement Pete Wacks will keep apprised of breaking developments on the mob front. He plans to do some consulting work within the labor field and will remain in the Chicago area - his home for the last 30 years, though he was born in the Jackson Heights section of New York City.

Looking back on three decades, he praises Chicago’s veteran FBI agents he had the privilege of working with. “We had some great guys, knowledgeable street agents like Johnny Bassett, a former light heavyweight champion; Kus Kempf who introduced me to Joey Lombardo. Gus was great at cultivating informants. The late Frankie Ford comes to mind. He worked on cartage theft which was a major source of mob revenue back in the 1960s and 1970s. Dennis Shanahan. Ralph Hill. Bill Roemer. Jim Wagner.”

“The people I knew made this a wonderful job. “This was the greatest job in the world,” he sighs.

“I regret leaving the Bureau for these reasons. But I reached the magic age and now it is time to go.”

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