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Statement of

Joseph E. Griffin

SAC Cleveland Division

Federal Bureau of Investigation

Before the

Committee on Governmental Affairs Permanent Subcommittee on Investigations United States Senate

April 15, 1988

U.S. Department of Justice Federal Bureau of Investigation

Re: Organized Crime - 25 Years After Valachi

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            MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:

            I am honored and pleased to appear before you on behalf of the Cleveland Office of the Federal Bureau of Investigation.

            My opening remarks concern a recent history of the Cleveland Family of "La Cosa Nostra" (LCN) and of the accomplishments of the Cleveland FBI in eliminating this cancer to our society, and of our plans for maintaining the investigative momentum in this area.

            The story of the Cleveland LCN family is not one of criminal genius or of superior business acumen in the realm of criminality. It is a story of young hoodlums grown old, lacking any vestige of conscience, social responsibility, remorse or any other human virtue that would identify them as responsible members of human society.

            Their incentive is pure greed. Their business is feeding on the weaknesses of our society: gambling, alcohol, dangerous drugs, narcotics. Their competitive spirit is basic; elimination of competition by any means. Hired killers are used to dispose of persons judged to be disloyal or a threat to the status quo. Their business strategy is and has been the corruption of our laws, our leaders, our government and our society itself.

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            They have called themselves "The Family", "The Mob", "La Cosa Nostra" (LCN), which incidentally, roughly translates to "our thing".  It is a gang masked as a business. Its tools are guns, bombs, extortion and the threat of death.

            The Cleveland "LCN" began in 1913 when some young toughs, members of a street-gang called the "Mayfield Road. Gang", were recruited by a local newspaper to break up a rash of beatings, shootings and truck hijackings related to a newspaper circulation "war" in the Cleveland area. The street gang consisted of young hoodlums from a small district of Italian- Americans.

With the coming of prohibition, the Cleveland mob became active in bootlegging, liquor and taking advantage of Cleveland's harbor and frontage on Lake Erie by bringing in illegal liquor across the lake from Canada and servicing other harbor cities. To maximize their profits, they soon built a small bootleg empire by infiltrating the sugar industry, servicing hundreds of small operators of illegal stills, and then buying back the finished product for resale.

            As huge profits began to flow in, the money was "laundered" by investing it in gambling casinos in Las Vegas and resort hotels in Florida but in 1933, prohibition ended.

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            The Cleveland mob was left with a massive amount of capital, fleets of trucks and boats, and an army of trained gunmen whom were by that time "made" members of the Cleveland LCN family. The leaders met with their financial advisors and immediately branched out into new areas of crime: gambling, loansharking, labor racketeering and eventually narcotics. Meanwhile, large sums continued to be diverted into legitimate businesses, including real estate, manufacturing plants, theatrical agencies and even hospitals.

            As a teenager, John Scalish was a stick-up man and a burglar. In 1933 he was convicted of robbery, receiving a sentence of ten to twenty-five years in prison. Two years later he was pardoned by the governor. He emerged from prison to reassemble his former associates of the "Mayfield Road Gang" and soon became the "Boss" of the Cleveland family of LCN.

            Before his death in May of 1976, John Scalish maintained his reign over an organization of known friends and associates; taking no new members into the family, but merely maintaining his empire of gambling casinos in Las Vegas and undertaking various legal and illegal money-making schemes in the Cleveland area.

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            Scalish began to assess the possibilities of his infiltration of the labor movement, eyeing the massive resources, of the teamsters' union Central States Pension Fund. He soon developed plans to obtain a loan from that fund to purchase two major Las Vegas casinos, and then to skim money from the casino profits to be divided among several LCN families.     .

            This new development soon revealed both the interfamily cooperation that had developed within the LCN, and also the degree of penetration the LCN had made into the inner workings and leadership of the labor union movement. LCN support soon placed Roy Williams and later, Jack Presser into the presidential position of the International Brotherhood of Teamsters. This support not only came from the Cleveland family, but the families in Kansas City, Chicago and the Genovese family in New York as well.

            Upon the death of John Scalish in 1976, the position of Cleveland LCN "Boss" was taken over by James T. Licavoli. A power struggle soon developed between Licavoli and a faction of Cleveland west side organized crime figures, led by Danny Greene and John Nardi who intended to take over control of all illegal gambling in the Cleveland area, as well as exert strong influence  on the unions through Teamsters Local 410. The conflict burst

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into intra-gang violence when Licavoli's underboss, Leo "Lips" Moceri disappeared, the apparent victim of the gang war. Licavoli immediately put out a "contract" to kill Greene and Nardi.

            In May, 1977 John Nardi left the Teamster Hall in Cleveland and entered his car. He was blown to pieces by a bomb, detonated by a remote control device.

            After several failed attempts to kill Danny Greene, professional "hitmen" from out of state were recruited to assist in the murder of Greene. Jimmy "The Weasel" Fratiano from the Los Angeles family recruited Ray Ferritto, who traced the habits and movements of Danny Greene aided by the use of illegal wiretaps. As Greene returned to his car from a dental appointment, a bomb placed in a car adjacent to his, exploded, killing him instantly.

            Ironically, the death of Danny Greene served to do what Greene himself had been unable to do. The apparent use of outside mobsters and the developing evidence of interstate cooperation between mobsters made it possible for the FBI to place these overt criminal efforts into the category of a racketeer influenced and corrupt organization and subject to the Federal Racketeer Influenced and Corrupt Organizations (RICO) Statute. The FBI's intense investigation resulted in a successful prosecution in August, 1982 which was devastating to the Cleveland LCN family.

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            Not only was Cleveland boss Licavoli convicted, but also high-ranking Cleveland LCN members John P. Calandra, Anthony D. Liberatore and "associates" Pasquale J. Cisternino, Ronald D. Carabbia and Kenneth Ciarcia.

            Meanwhile, the Cleveland FBI was investigating a major narcotics operation, involving still more Cleveland-LCN figures. Court orders were obtained for electronic surveillance of the major figures involved, and in January, 1983, Federal convictions were obtained for Cleveland LCN Acting Boss Angelo "Big Ange" Lonardo, "Capo" Joseph C. Gallo and "Associates" Kevin J. McTaggart, Harmut Graewe and Frederick Graewe, One leading crime figure, Carmen P. Zagaria, cooperated and became a star witness not only for this case, but other major Federal cases involving the LCN.

            Eventually the entire hierarchy of the LCN in Cleveland was convicted in these two FBI cases.

            As these cases developed in the late 1970s and early 1980s, it soon became apparent that the widely accepted "loyalty" between the mob leaders was only a myth. In 1983, Angelo Lonardo became the highest ranking LCN figure to become a government witness against the mob, not only in Cleveland, but in other parts of the nation. To date, his testimony has been devastating to LCN families in New York and Kansas City and the information

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he has provided has given the FBI a unique insight into the inner structure of the LCN.

            My opening remarks have been intended to familiarize you with the kind of people we have been dealing with and the kind of organization with which we are confronted. It is not my intention, however, to portray the Cleveland Division's successes as an end to the story.

            The threat of organized crime continues. The relationships between the families of the LCN are as strong as ever. With the conviction of the Cleveland LCN leadership, the vacuum was quickly filled by an "acting boss", a former "consigliere" or legal advisor for the Cleveland family, John "Peanuts" Tronolone. Based on testimony by Angelo Lonardo, Tronolone has been charged with RICO violations and is currently standing trial in New York. The FBI recently charged the last active made member of the Cleveland LCN family with Federal narcotics violations. Even with the successful prosecution of the Cleveland family, all it would take is one initiation ceremony to take in new members and the Cleveland family would be back in business once more. When the pressure is relaxed and the attention of the government is focused elsewhere, the LCN returns to its original structure and continues business as usual.

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The Cleveland Division of the FBI plans to vigorously pursue organized crime as a high investigative priority and to increase our emphasis on the investigation of LCN infiltration and control of labor unions through labor racketeering matters. We consider this criminal activity one of the most serious threats to our free society.

Mr. Chairman, this concludes my prepared remarks. I will be happy to answer the subcommittee's questions.

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