Operation Greylord

by Terrence Hake

  “Boy, Wayne really stuck it to Peter,” Jim told me in the hall. “Are you going to take care of him, or what?”

  “Peter doesn’t even know I’m involved [on the take], does he?” I asked.

  “He knows, Terry. Look, there’s three bills [three hundred dollars] he gave me. Peter wants the case recalled today and the gun charge dismissed. He’s really hot on this. I know you’re not helping out [taking bribes] any more, but can you do it just this once?”

  “What do I get, a hundred and a half?”

  “I’ll give you two, I’ll keep one.”

  “Let me think about it overnight because I took such a strong position just now, all right?”

  “Sure,” Costello said. As he walked away, he added, “Say hi to Cathy for me.”

  “If I see her.” He was still testing me.

  The next day I walked into Olson’s chambers and asked that Kessler’s hearing be advanced. Contact agent Bill Megary had just told me that the FBI would be removing the tiny microphone from Olson’s desk in two weeks, so I wanted the fix to go down before then.

  The judge was feeling good because he was about to perform a Narcotics Court wedding for a policeman who often testified there. Without asking why I wanted an earlier date, he picked January 20—the final day of the bug! Next I told Costello I wasn’t going to take any more money from Kessler because I was starting to feel pressure from my bosses, and that he should speak to Olson about supervision on the gun charge, hoping this would be done in the chambers.

  The Final Day

  As soon as I came to work on January 20, I submitted my resignation from the State’s Attorney’s Office so I could start my own (bogus) law practice. Then I went about tying up as many of the loose ends of the bugging operation as I could before the microphone was removed that afternoon.

  Costello paid a visit to Olson’s chambers and said, “Judge, I’m trying to catch up in arrears.” The desk drawer opened and closed. We later learned that Costello had dropped in two hundred dollars from bond referrals, then added a cash envelope from Kessler. But the judge evidently had been looking elsewhere and didn’t notice it.

  “There’s something else in there,” Costello said on the tape.

  Olson probably turned around, saw the extra money, and somehow acknowledged it without a word. Then Jim left, and I walked in to discuss the sentencing stalemate in Kessler’s case.

  “Kessler and Costello want supervision,” I said.

  “Well, if there’s a good reason for it, I’ll give it,” Olson replied, “but otherwise I’m not inclined to give him supervision.”

  Wasn’t the fix set? I went out and told Costello what the judge had said about the gun charge. A few minutes later, Costello returned to the chambers.

  “I can’t take the heat on a gun,” Olson told him. “What are we going to work out?”

  “The weapon came from the family’s business, he’s got registrations for it,” Costello answered. “He knows there’s no fuckin’ way he is gonna get it back. He isn’t a guy that’s running around in the street.”

  “Who represents him, you or Kessler?”

  “Kessler.”

  “What’s he gonna drop?”

  “He dropped three [three hundred dollars]. That’s what I was trying to tell you. That’s what I gave you.”

  From the sounds, it seems that Olson looked into the envelope in his drawer. Then, raising his voice, he said, “There’s only four hundred and fifty in there.”

  “There was five hundred!” Costello insisted.

  “Tell Kessler to make his argument,” said Olson, dismissing the difference for now. “Argue that his guy needs to keep a good record.”

  “Okay, fine, Judge,” he groused. “Thank you very much.”

  After Costello left, I walked over and asked him, “What’s up, Jim?”

  “There was five hundred dollars in that envelope. I’ve had it with that guy, Ter. I know Wayne’s given me a lot of business, but I just don’t give a shit any more. He’s trying to screw me around for another fifty.”

  At the time, I did not know what had been said to Olson but I saw another chance to have the two natural enemies incriminate themselves. “Jim, you’ve got to settle it with Wayne,” I suggested, “you’re losing track and he’s losing track.”

  “He isn’t losin’ track, I can tell you that.”

  “Then you don’t want him to have a laugh on you, do you? Why don’t you settle it now and get it over with.”

  Costello agreed with a shrug.

  At the hearing, Peter Kessler played out the scene just as it had been worked out. The judge put the defendant on supervision and retreated to his chambers with Costello at his heels. Their agreement to keep better track of the payments was one of the last of the twenty-five hundred and thirty-eight conversation segments recorded in the FBI office in less than two months.

  After Olson left for the day, federal agents snuck into his chambers and removed the device. I celebrated by going to a restaurant in the Little Italy neighborhood on my way home and ordering an Italian beef sandwich. After all, although I was working for the FBI, my only income was still from the State’s Attorney’s Office.

  My resignation would not take effect until February, but I kept showing up at 26th and California even though my heart was no longer in court work. I was in a transition phase since I had been telling fixers for months not to give me any further bribes. But the hiatus was far from wasted.

  A Fixer’s Education

  Because I was going into practice on my own, Costello’s tip was to “give Wayne a grand and you’ll start getting some business.” Bob Silverman graciously decided to show me how to rig a case, using as an example something he was handling for a man arrested for drug possession in an apartment leased by his girlfriend.

  “If a lawyer can prove the person charged with possession does not have residency, the charges are usually dropped,” he said in his mellow voice. “Now, this copper is a friend of mine. He gave me the police report yesterday,” no doubt for a bribe. “The report nowhere states residency. The only way to prove it is from testimony by the cop, and the cop isn’t going to know.” Another bribe. “You got to check your case report. If something isn’t in there, it doesn’t exist.”

  “But the ASA can prove residency with gas bills and rent receipts,” I said.

  “Sure, but those can get lost on the way to court,” for another bribe. “These are the things it took me years to learn.” Then he added a pun: “Quid pro crow, as we used to say in Latin.”

  “And it makes it all the easier for the state’s attorney to dismiss the case, too,” I said to feed the tape running behind my belt.

  “Of course it does. I wouldn’t go to an ASA and ask for a dismissal if there wasn’t a way out. Now he can step up to the judge and say ‘Judge, we cannot establish residency.’ Boom—case over. And nobody’s caught in the middle.”

  Silverman asked to see my copy of a police report on one of the cases I was handling that day, even though it didn’t involve him. I handed it over and he walked away. A little later he gave it back. When no one could see me, I thumbed through the pages and found a one-hundred-dollar bill tucked inside.

  My taking his money made me more trustworthy, and Bob could be less formal with me. Within two days he found me in the Narcotics Court clerk’s office and said, “I want to talk to you about something.” He led me to the washroom in the judge’s chambers and put one hundred dollars in fives in my hand for dismissing a drug case before the damning lab report came in.

  But since Silverman had given me the payoff before I could get him to be specific on tape, I met him in the hall a few minutes later and told him the money was more than enough.

  “It’s my pleasure,” he replied.

  12

  SWITCHING SIDES

  February 1981

  Because of the old rumor about my being a government operative I was having trouble making headway in the criminal courthouse,
which I had once known so well. In my final days as an assistant prosecutor, I dismissed a case for Silverman and found myself holding one hundred dollars in fives after we shook hands. That was my fifth payoff from him, more than enough to throw him in prison when the time came.

  There was no going-away party for me, I just made the rounds and exchanged handshakes with the honest and dishonest alike. But I wasn’t forgotten. The “boys” surprised me with a belated goodbye party at a restaurant two weeks later. Costello gave me a few hundred dollars he had practically strong-armed from fellow bribers and told me to use it for a new car.

  I soon missed the hectic schedule of my double life. Until authorization could come down for “live” (set up) cases, for the next few months I did little more than sit at home re-listening to my tapes and writing down every word to help juries follow them. Costello called me regularly, unaware of the tape recorder I had attached to the receiver. So that I might at least be seen in a suburban court, I persuaded my mother sit down with me once as if she were my client.

  Unflappable FBI agent Bill Megary suggested that since the Olson bugging had gone so well, we might plant a microphone in the chambers of Judge John Reynolds because a crime syndicate burglary case was coming up. Reynolds was such a martinet that he was called “Black Jack” behind his back, after General “Black Jack” Pershing of WWI. He was a well-dressed, thin man of fifty who had taken an airline stewardess for his second wife. For at least two years Reynolds, the son and brother of lawyers, had been grabbing every bribe he could. To make the pickings easier, he rid his courtroom of all attorneys sent by the Chicago Bar Association.

  That was how Mark’s partner, Frank Cardoni, could receive more than one hundred thousand dollars from bond referrals in just a year and a half in his courtroom. In return Cardoni slipped a third of the money into such places as a golf magazine on Reynolds’ desk, in the pocket of a suit jacket hanging in the chambers, in the judge’s home, under the table in restaurants, and in the console between the bucket seats of the judge’s luxury BMW.

  In fact, Reynolds’ BMW came from payoffs—along with a fur coat for his pretty wife, a country club membership, a Mexican condominium, and an apartment in Chicago’s Gold Coast. With the opportunity of free travel from his wife’s job at American Airlines, he took single-day trips to New York just to be fitted by his favorite tailor.

  Unlike Olson, Reynolds told fixers to keep a detailed record of how much they owed him. Fond of paying cash for everything, he always made sure he had at least two thousand dollars stuffed in a “sock drawer” at home. Reynolds would later attribute his corruption to “mid-career burnout.” Records showed that this methodical “burnout” contributed to the corruption of at least five attorneys and half a dozen court clerks.

  Some say that lawyers corrupt the judges, but in Chicago it was often the other way around. The good-looking Cardoni was a bright and aggressive young man who was just two years out of law school when he started representing clients in the court at the police station at Belmont and Western. Reynolds taunted him with such hints as, “Did you just get off the Belmont Avenue bus?” and, finally, “So far, it’s been like you’ve been kept on a scholarship, and now your scholarship is over. This is a business. Look around you, see how business is done.”

  Cardoni took the hint, and a from-one-pocket-to-another relationship deepened between the two men. Frank had lunch with Reynolds daily and dated the judge’s daughter from a previous marriage. He also was the judge’s guest on a Mexican vacation. The friendship was so lucrative that Cardoni needed a partner to handle all the cases, and that was how my friend Mark Ciavelli was seduced into corruption. Within a month of leaving the State’s Attorney’s Office, Mark was delivering six hundred dollars a week in cash to Reynolds on behalf of the new law firm.

  While Reynolds was on vacation, his replacement opened a desk drawer looking for napkins and found a stack of one-hundred-dollar bills from various lawyers. But even honest judges abided by the code of silence, and Reynolds was never reported.

  One of Reynolds’ clerks acted as a bagman. Most clerks were already making five to ten thousand dollars a year from lawyers wanting their cases called early or to see court files. Not trusting them, Reynolds ordered that lawyers never leave bribes in a drawer unless he was in his chambers, but sometimes he would leave money there himself—and the clerks usually would steal it.

  I had left the State’s Attorney’s Office just as Mark and Cardoni were in the preliminary stages of representing minor mob figure Salvatore Romano, who had been caught trying to burglarize a suburban meat market. Since Romano was also a federal informant, the FBI saw a way of expanding Greylord when he and three accomplices hired Silverman.

  The police report was so damaging there was no way Reynolds could throw out the case without having someone cry fix, so Bob decided to bribe the owner of the meat market into staying away from court. The price would come high. “I want a nickel apiece,” Silverman told the four defendants, meaning five thousand dollars each. “But if I can’t help you, I don’t want your money.” Investigators learned that one of the defendants, Glen Devos, said, “If this guy [the owner] gets any second thoughts, I’ll kidnap the motherfucker.”

  An FBI agent went to Romano’s home and gave him a Nagra recorder. The next day, the mobster’s tape picked up a conversation in which Silverman spoke about letting Cardoni in on the deal. Later, Silverman asked Romano to visit the owner of the meat market, Tony Pedio. But since Romano was working for the FBI, he decided to stay away from him, leading to confusion.

  Pedio showed up outside the courtroom and sparked a huddle by the four thieves. Then Cardoni arrived in his tailored suit and well-polished shoes. What happened next, pieced together from witnesses, shows how complex payoffs could be:

  “Hi, Sal,” Cardoni said. “What’s all the crowd for?”

  “The complaining witness is here,” Romano explained.

  “Well, get him out. Now!”

  “I say we offer him a thousand dollars” to go home, Romano said.

  “Make it two,” Cardoni said.

  Then he and Romano walked over to Pedio. Lying, Cardoni claimed there had never been a case in Cook County history in which prosecutors penalized a witness who refused to answer a subpoena. Since the arresting officers in the hallway didn’t like seeing a victim so close to the defendant and his attorney, they broke up the conversation.

  Before long, Romano and Silverman met again in the hallway with the other men charged with the break-in. Seeing how scared Pedio was, Romano walked over to him and said, “Take two thousand dollars and go have coffee.”

  “Money don’t mean nothing,” Pedio said. “What you guys did was wrong.”

  “Me and my partners, we’re sorry.”

  “The cops—”

  “They won’t say nothing other than ‘The man didn’t show up, Your Honor,’” Romano assured him.

  “They’ll want to know why in the hell I’m leaving.”

  “So you got tired, you got fed up. Otherwise, we’re gonna continue this thing for a year.” That was always an effective threat because of the lost business that postponements usually caused. “Walk in the washroom with me and I’ll give it to you.”

  “No, I couldn’t.”

  Silverman stepped in and introduced himself, telling the victim, “Nothing would happen to you. I give you my word on that. I won’t let it happen. If there’s any kind of steam at all, you won’t be in the middle.” After all, Bob Silverman was an honorable man.

  Whether out of fear or dismay, Pedio left the police station empty-handed. Showing more sensitivity than most fixers, Bob told Romano to drop by the man’s shop and deliver the two thousand dollars. “You know how much sleep this guy must have lost because of what you guys did? Sal, no phone calls, no nothing. Just drop it off in an envelope today. Walk in and walk out.”

  Reynolds dismissed the case because of Pedio’s absence, but the ASA moved to reinstate it. When the case ca
me up again, Silverman and Cardoni conferred with the burglar mole in a hallway. “It’s time to bring in [bribe] Reynolds,” Silverman said. “I want you to give him a dime [one thousand dollars]. If you haven’t got it, I’ll lay it out now. I want you to kiss it off.”

  “I got a couple hundred,” Romano said.

  Bob asked Cardoni, “Whatta you got?”

  “Two,” meaning two hundred dollars.

  Silverman counted Romano’s and Cardoni’s money, and finally his own, a total of one thousand dollars, while mumbling, “Shit, I don’t want to make a fuckin’ career defending these guys.”

  Minutes later Judge Reynolds refused to reinstate the case. Cardoni expected to keep half of the thousand dollars he had brought to the judge’s chambers, but Reynolds took it all, and that was the end of it.

  The entire sequence shows how invaluable an insider can be when investigating corruption, since nothing Reynolds did publicly would have sent up a red flag. So it was little wonder we were devastated when we learned that the judge was being transferred before we could set up a listening post in his chambers. I had even suggested secretly photographing the room for a floor plan before the microphone was installed. But we weren’t going to let up on Reynolds. We were still at the muscle-flex phase of the investigation in which we thought nothing could stop us. But we had a lot to learn.

  I made a routine call to Costello’s home on a Saturday in late February. “Don’t talk on this line,” he said in a worried voice. “My God, didn’t you see the Tribune this morning? The feds are investigating Narcotics Court. From now on, if we speak, we speak in person.”

  “Jim, what’s going on?”

  He hung up.

  I went to my car and drove to a newspaper stand. The front page story shot through me: A federal grand jury, reportedly conducting a major investigation of how drug cases are handled in Chicago, has subpoenaed all records of cases handled in two Cook County courtrooms during the last four years. There were reports that the grand jury is seeking evidence that defendants in drug cases are illegally “steered” to certain defense lawyers.