Deal with the Devil

by Peter Lance

  Tabman went on to say that in “November or December of 1987 . . . the Mattiace squad was absorbed into SSA Lindley DeVecchio’s squad.” During this time, he recalled “having discussions with SSA DeVecchio regarding the Scarpa crew and the DEA case.”41 Tabman remembered DeVecchio “being very interested in this matter.” So, despite Mattiace’s comments in DeVecchio’s book—that his squad had “absolutely no interest” in the investigation—Tabman’s account suggests that DeVecchio was at least aware that Gregory Jr. was a DEA target. Further, Mattiace’s admission that he knew about Scarpa’s marijuana operation seems to contradict DeVecchio’s sworn OPR statement. In that document, echoing the earlier 209s he sent to Washington, DeVecchio made this affirmative statement: “I had no idea that Scarpa Sr. or Scarpa Jr. were involved in drug distribution. It was my understanding the Colombo Family had a disdain for drugs.”42

  “In that single statement,” says former FBI agent Dan Vogel, “Lin DeVecchio raises a serious question about his credibility. Given what’s known about Scarpa’s extensive drug operation, it defies belief that the supervisory special agent who was supposed to ‘control’ him didn’t know he was committing these crimes—especially when you look at the statement of Chris Mattiace, who admitted knowing about the Staten Island College operation. How do you gross $70K a week under the watchful eye of your contacting agent and have him miss that?”43

  As to Mattiace’s characterization of the Staten Island drug operation as a kind of “Dead End Kids” enterprise, Tabman underscored the lethal nature of it in his OPR statement:

  We became involved in the investigation in a series of murders and we did a flow chart regarding the relationship of the decedents. These relationships all involved Gregory Scarpa Jr. It seemed as though each time we identified a potential subject in these cases that subject was found deceased after identification. I remember this occurring on approximately three occasions, one in particular involving a blond haired subject, who was found deceased the day after we determined his identity.44

  Putting aside whether SSA Lin DeVecchio leaked any of that intelligence back to Greg Scarpa Sr., could DeVecchio, who had monthly and sometimes weekly meetings45 with Scarpa, have been so clueless about the fact that his informant was running a multimillion-dollar marijuana, cocaine, and heroin operation? Was he really so naïve as to believe that the Colombos “had a disdain” for such a lucrative enterprise? The operation had begun with the murder of a pot dealer. It had grown into a $10,000-a-night enterprise that was considered such a public threat that Valerie Caproni expended significant resources to put Scarpa Jr. behind bars. Yet in his book Lin DeVecchio seems to downplay its importance, and none of his 209s to Washington ever hinted that Scarpa Sr. was linked to drug trafficking.

  The Wimpy Boys

  In the sworn statement he gave to agents during his OPR (internal affairs) investigation in 1995, DeVecchio confirmed that “Scarpa Sr., operated Wimpy Boys Club on 13th Avenue in Brooklyn, New York during the 1980s.”46 In his memoir, when he describes the first time he approached Scarpa outside his house on Avenue J in June 1980, DeVecchio writes, “I knew roughly what time he headed off to his Wimpy Boys Athletic Club, where he held court and conducted business.”

  In July 1986, the Brooklyn DA filed a thirty-page sworn affidavit seeking to extend wiretaps at the club. In the affidavit, Assistant DA Marlene Malamy cited pages of transcripts from previous bugged conversations involving Scarpa Sr., Larry Mazza, and other associates discussing drug dealing and loan sharking. Based on that surveillance, she wrote, “We are now in a position to state with certainty that SCARPA conducts his business on almost a daily basis from the above-captioned premises.”47

  Scarpa outside the Wimpy Boys club, 1986 (FBI surveillance video)

  On or about January 9, 1988, federal prosecutors in Brooklyn obtained copies of the Wimpy Boys eavesdropping tapes.48 So that location was clearly known to DeVecchio and prosecutors in Kings County and the Eastern District as Scarpa’s headquarters. But testifying under oath in 1998 at Greg Scarpa Jr.’s trial, under cross-examination by defense attorney Larry Silverman, Lin seemed to deny it.49

  Silverman: During the time period, sir, from 1980 to 1987, during that time period was the Wimpy Boys Club Mr. Scarpa’s place of operation?

  DeVecchio: I have no idea.

  In that trial—just as in the 1997 Vic Orena hearing, when he answered, “I don’t recall,” or words to that effect, more than fifty times—Lin DeVecchio was testifying pursuant to a grant of immunity.50 As such, he could not be prosecuted for any admissions he might have made about his relationship with Greg Scarpa Sr. Whether that immunity extended to perjury is a question for legal scholars to ponder. But his contention that he had “no idea” whether his informant Scarpa was using the Wimpy Boys club as his “place of operation” seems clearly disingenuous, especially given the account in his 2011 book.

  Mario from the Deli

  There’s another detail in DeVecchio’s book that suggests he wasn’t entirely forthcoming in the reports about “34” that he sent off to Washington. Mario Parlagreco was a key member of the Wimpy Boys crew who participated not just in multiple drug deals but in other crimes, such as the conspiracy to murder Cosmo Catanzano and bury his body. In his book, DeVecchio goes into detail about how Parlagreco happened to join the Thirteenth Avenue crew. As Lin tells it, Mario’s father ran a deli with a “partner” whose son got released from jail. The son was then supposed to come to work at the deli:

  Only he thinks all he has to do all day is smoke pot, put his hand in the till for money, and let Mario take care of the business. Mario’s father goes to his partner and says either you buy me out or I buy you out. The partner took over the deli then welshed on the $50,000 purchase price.51

  In DeVecchio’s version of events, Mario went to the Wimpy Boys club, and Greg Sr., acting as a kind of benevolent Don Corleone, “had a sit-down with Mario’s father’s partner and got all the money Mario’s parents were entitled to.” After that, DeVecchio writes, “Scarpa announced to . . . Mario that he’s now with the crew.”52

  It’s a great story that’s true in part, but a couple of key elements are missing from both DeVecchio’s book and any 209s he might have sent to Washington at the time.

  First of all, the “partner” in the deli was none other than Joseph Peraino Sr., the porn king and Deep Throat producer whose brother Anthony had been rendered back to the United States from Costa Rica by Greg Sr. The “son” who smoked pot and stole was Joe Jr., who was killed in that attempted hit on his father that took the life of Veronica Zuraw, the former nun—an incident DeVecchio described only in part in his 209 report in 1982.53

  According to an FBI 302 memorializing Mario Parlagreco’s debriefing after he became a cooperating witness in 1994, the $50,000 represented the bond that Mario’s father had put up to spring Joe Jr. from jail.54 In that detailed eight-page 302, Parlagreco recounts how he “thought it was interesting [that] Scarpa Sr. continued to do business in the club involving the collection of shylock money and other criminal efforts” after he knew that bugs had been planted.

  “Parlagreco stated that a lot of people thought it was strange that Scarpa Sr. . . . rarely, if ever, got arrested while others did. . . . A number of Parlagreco’s associates surmised that Scarpa Sr. was cooperating with law enforcement, but nobody wanted to challenge him about it as he was a dangerous man.”

  The connection between Mario Parlagreco, his father, and the Perainos was significant. It was certainly the kind of interfamily intelligence that DeVecchio’s FBI superiors in Washington would have wanted to know. So why didn’t DeVecchio include it in his 209 on Joe Peraino Jr.’s shotgun murder in 1982? It’s another example of how, when it came to the Colombo crime family, FBI officials got only part of the story.

  As the head of two organized crime squads in the FBI’s New York Office, Lin DeVecchio was in a position to document the full depth and breadth of Gregory Scarpa Sr.’s hugely lucrative and viole
nt criminal activity. But he didn’t. Instead, he was extremely protective of his source—so much so that, when another branch of the government threatened to put Scarpa away for years, Lin went out of his way to keep him on the street.

  Chapter 15

  ENTER THE SECRET SERVICE

  On the Ides of March 1985, not long before the DEA began its investigation of Greg Scarpa Sr.’s drug operation, which was grossing $70,000 a week, the FBI rewarded him with a $15,000 bonus.1 In a teletype nearly two weeks earlier, the Bureau’s New York Office justified the bonus to “34” because of what was described as the “vast quantities of singular information concerning the Colombo Family which has directly led to 17 affidavits in support of Title III intercepts and 50 re-authorizations of these intercepts.”2 Now even as he was continuing his loan-sharking, gambling, and drug operations, Scarpa was acting to eliminate his principal competition in the Colombo family—the boss Carmine Persico, who’d been arrested the previous October along with his underboss, three capos, and other family members in operations the Feds dubbed ECLIPSE STAR and STARQUEST.3

  From the time he was opened in 1962, the FBI had paid Greg Scarpa a total of $96,475,4 not counting the tens of thousands in reward “kickbacks” he’d earned via Tony Villano, and that March 2, 1985, teletype was filed in order to justify the latest bonus. In the five-page memo, the New York Office also credited Scarpa with assisting in the takedown of Genovese family boss “Fat Tony” Salerno.5 The NYO reported that “the result” of Scarpa’s intel was “the saving of countless thousands of man hours in investigative time,” providing “a window into the inner workings of the most significant organized crime group in the country.”6

  The view through that “window,” of course, was entirely from the perspective of a drug-dealing murderer who had everything to gain by removing his Colombo competitors—but neither DeVecchio nor the New York SAC who signed most of the airtels and 209s to DC ever mentioned that. Instead, that March 2 teletype closed with a reminder to the brass at Bureau Headquarters that “sources of this caliber are extremely rare in the FBI and serve as a tribute to the informant . . . program.”7

  FBI teletype authorizing wire payment of $15,000 to Scarpa Sr., March 15, 1985

  (Peter Lance)

  The 209 ended with a request that Scarpa’s $15,000 bonus be sent by wire or separate check. It was a fee worth more than $32,000 in 2013 dollars.8 On March 15, FBI Director William H. Webster himself authorized a wire transfer for the payment to be sent to Chemical Bank on Church Street in Lower Manhattan to be picked up by a supervisory special agent whose name was redacted from the memo.9

  But using a habitual criminal like Greg Scarpa Sr. was a risky prospect, and less than eight months after the Director’s endorsement of his work, another branch of the U.S. government sought to lock him up again.

  The Bogus Plastic

  On November 5, 1985, an undercover agent from the U.S. Secret Service met with Scarpa at the Wimpy Boys club and sold him three hundred blank credit cards—150 Visas and 150 MasterCards—for $9,000. The cards were complete with “holograms” and “mag stripes,” and if embossed with fake names and numbers could have been used to gross Scarpa up to $1.5 million. His MO was to send members of his crew out to large box stores in New Jersey and have them max out the cards buying televisions, home appliances, and other expensive, resalable merchandise. It was an ingenious, 1980s kind of white-collar hijacking that produced the sort of exponential profits Scarpa Sr. loved. But after he counted out the cash to the undercover agent in the club, Greg was coaxed outside to pick up the phony “plastic.”

  Suddenly he was surrounded by uniformed agents, guns drawn.

  Without putting up a fight, Scarpa was arrested by a backup team, taken into custody, booked, and printed.10 After his release on a $300,000 bond, he admitted to Edward A. McDonald, the EDNY Strike Force attorney spearheading the case, that he was a confidential informant.11 That triggered alarm bells between the FBI’s NYO and Headquarters. On December 18, FBI Director Webster sent a teletype to New York acknowledging that FBI HQ had received Scarpa’s fingerprints and issuing a series of pro forma questions as if Scarpa was a typical CI.

  Among the boilerplate questions, which were non-gender-specific:

  • Was the arrest related to his/her assignments as an FBI Informant?

  • Has any attempt been made to intercede on behalf of the Informant?

  • Do you anticipate making an effort to intercede for the source in the future?

  • Furnish justification for continued use of Informant.12

  The canned response almost suggested that Webster, who had approved a $15,000 bonus for Scarpa just months before, had never even heard of him. It was as though the Director had turned into Casablanca’s Inspector Renault, announcing that he was “shocked, shocked to find gambling going on here” before accepting his winnings.

  The next memo to Washington, from the Colombo Squad, not only misstated the details of the Secret Service undercover operation as outlined by Assistant U.S. Attorney McDonald; it seemed almost to mock the senior Strike Force attorney.

  Rather than confirming that Scarpa had counted out the $9,000 in “buy” money before his arrest, consummating the deal, the memo stated merely that “the Source agreed to look at samples on the day of the arrest.”13

  Then, in relating a conversation between McDonald and Scarpa at the office of the Secret Service after his arrest, the memo quoted McDonald as saying that “the FBI was known to have a love affair with their informants,” emphasizing that “the Source would not get ‘a pass in this case.’”

  According to the memo, McDonald then offered to let Scarpa into “the Witness Security program in return for his cooperation and subsequent testimony [but] The Source refused this offer.” The memo then asserted that “the NYO had several conversations with McDonald subsequent to the arrest” and that, after one meeting involving NYO agents, McDonald, Assistant U.S. Attorney Norman Bloch, and the Secret Service agents, “the EDNY dismissed the original complaint and made attempts” to hold off on an indictment.14

  A Special Lawyer for Scarpa

  After it was determined that “it was not safely possible to discuss Source’s relationship with the FBI” with Scarpa’s own lawyer at the time, Greg Sr. retained an attorney named William Kelleher. According to the memo, Kelleher advised that Scarpa should continue his relationship with the Bureau and that “further contact will assist the source against a possible indictment.” The name of Scarpa’s Bureau contact, an SSA, is redacted in the memo, but there’s little doubt it was Lin DeVecchio.15

  The memo goes on to predict that, “through efforts of the NYO with respect to organized crime investigations beneficial to the EDNY,” Scarpa would be removed “from any further threat of prosecution.”

  The memo to the Director concludes with the announcement that “the NYO will continue to operate this source in the normal manner [and] that only SSA and not Secret Service or the EDNY has approval from Source’s counsel to contact the source.” Adding an incentive for the Eastern District to dismiss the case, the memo finishes with the promise that “the EDNY can be furnished with significant information from the Source to result in no further prosecutive action.”

  The next memo from the FBI director confirming Scarpa’s continued status as a TE informant ends with an admonition that was almost comical given Greg’s criminal history: “Source should be admonished,” he warns, “not to get involved in any future unauthorized criminal activity.”16

  “We can only imagine the hysterical laughter from Scarpa Senior, if, in fact, Lin DeVecchio ever delivered that warning,” says former Special Agent James Whalen, who worked in the NYO. “That’s if [DeVecchio] could even do it with a straight face. At this point, given the lengths the Bureau had gone to in order keep him out of jail, Scarpa had to be thinking to himself that he could get away with murder.”17

  The lengths DeVecchio went to in defense of “34” in this case are worthy o
f note because he later testified under oath that he typically didn’t go out of his way to shield informants from prosecution.18 This is what the former SSA admitted to during his 1995 OPR investigation:

  Scarpa Sr. told me he had already advised [Assistant U.S. Attorney Edward] McDonald that he was cooperating with the FBI. I prepared a document which explained his contributions, obtained approval from FBIHQ to make the disclosure, and I consulted with Ed McDonald, the head of the Organized Crime Strike Force (OCSF), in Scarpa Sr.’s behalf.19

  Lin also admitted that he made “an official contact with Judge I. Leo Glasser, who heard the USSS [Secret Service] credit card case against Scarpa Sr.” DeVecchio went on to state that he “made that approach with AUSA Norman Bloch . . . and the contact was endorsed by the FBI.”20 Bloch, who was special counsel to the Strike Force at the time of Lin’s intervention, later went into private practice with DeVecchio’s longtime attorney Douglas Grover, who was also a former Eastern District prosecutor.21

  But despite DeVecchio’s intervention and Scarpa’s TE status, Strike Force attorney Ed McDonald was not going to drop this case without a fight. He pressed the matter before a grand jury and a four-count indictment was returned. It included a count accusing Scarpa of possessing “more than 15 counterfeit access devices” with “intent to defraud”—devices that would have allowed him to activate the bogus cards.22

  Agents Behind a Mirror