Deal With the Devil: The FBI's Secret Thirty-Year Relationship With a Mafia Killer

by Peter Lance

  “What happened in New York two decades ago,” says Emad Salem, “is still causing blood to be spilled in the Mideast and threatening U.S. security. The Sheikh is the prince of jihad and even from inside a prison cell he wields tremendous power.”65

  Rahman’s deadly influence as a rallying point for jihadists was reinforced on October 28, 2012, when bin Laden’s successor, Ayman al-Zawahiri, issued a two-hour video calling on Muslims worldwide to kidnap westerners and “spare [no] efforts” to free Sheikh Omar.66

  Such developments leave no doubt that the threat to world security posed by Omar Abdel Rahman, the leader of the terror cell spawned in New York in 1989, continues to resonate. But what lessons can be learned from that going forward? A case in point that takes us back to the organized crime story involves a mailbox and check-cashing store in Jersey City, first detailed in Triple Cross.

  Sphinx Trading

  As far back as 1991, FBI agents were onto a storefront called Sphinx Trading on Kennedy Boulevard, located in the same building as the Blind Sheikh’s al-Salam mosque.

  Within weeks of Rabbi Meir Kahane’s murder, the Feds knew that El Sayyid Nosair kept a mailbox at the store. Three years later, Patrick Fitzgerald and Andrew McCarthy put the store’s co-incorporator, Waleed Abdu al-Noor, on a list of 172 unindicted co-conspirators that included bin Laden, Ali Mohamed, and Mustafa Shalabi.67 But by 1997 the top investigative goal in the FBI’s New York Office was “getting” Gambino family boss John Gotti.68 So the Bureau’s priorities were misplaced. At that time the NYO was conducting virtual round-the-clock surveillance of Gotti’s Ravenite Social Club—the same location where prosecutors claimed Vic Orena had met with the “Dapper Don.”

  As noted in a Huffington Post article I wrote, if the Feds had devoted just a portion of the surveillance resources that they’d dedicated to the Ravenite to Sphinx, they could have been in the middle of the 9/11 plot months before Black Tuesday.69*

  Why? Because in July 2001, Khalid al-Midhar and Salem al-Hazmi, two of the 9/11 “muscle hijackers,” got their fake IDs delivered to them in a mailbox at Sphinx. The man who supplied them was Mohammed El-Attriss, Sphinx’s co-incorporator with Waleed Abdu al-Noor.70 How difficult would it have been for the Feds to connect those dots? But in their obsession with defeating the “Mafia enemy,” FBI officials allocated massive resources against Cosa Nostra at a time when the al-Qaeda threat to New York was metastasizing.

  Sphinx Trading, located on Kennedy Boulevard below the al-Salam mosque

  How Safe Are We from the Terror Threat?

  The Boston Marathon bombings, nearly twelve years after 9/11, gave Americans shocking cause to ask how safe they should feel with the FBI guarding their homeland. How many of the 508 terror prosecutions since 9/11 represented viable threats? In April 2012 the New York Times reported: “Of the 22 most frightening plans for attacks since 9/11 on American soil, 14 were developed in [FBI] sting operations”—that is, with help from undercover agents.71 In his 2013 book The Terror Factory: Inside the FBI’s Manufactured War on Terrorism, Trevor Aaronson wrote that, of those 508 defendants, he “could count on one hand” the number of genuinely dangerous terrorists prosecuted by the government.72 One exception was another FBI failure: the May 2010 Times Square bombing plot.73 After the device fizzled, the NYPD brought terrorist Faizal Shazhad to ground in fifty-three hours.74 But the FBI’s Joint Terrorism Task Force (JTTF) had actually had Shazhad on their radar as early as 2004.75 He’d trained at a Pakistani terrorist camp, returning just three months before parking a WMD in the theater district undetected by the FBI. Then, after the Boston bombings, it emerged that the Bureau had vetted and cleared Tamerlan Tsarnaev in 2011 after a request from Russian authorities.76 Two stunning counterterrorism failures that may point to the Bureau’s lack of capability in the language of terror.

  In May 2012, Senator Daniel Akaka (D-HI), the chairman of a Homeland Security subcommittee, held his seventh hearing on what he termed “a national security crisis”: the lack of foreign language skills at the intelligence agencies.77 Six months later, I wrote the FBI to ask how many agents and management they had who were fluent in Arabic, Urdu, and Farsi. They replied: “The FBI has over 100 Special Agents who speak Arabic, Farsi, and/or Urdu [and] over 340 full and part time linguists who speak, or provide services, in Arabic, Farsi, and/or Urdu.”78 To put that number in context: By 2009 the FBI had roughly 5,000 SAs working counterterrorism.79 That barely 2 percent are fluent in the language of the “enemy” is some measure of the FBI’s preparedness to stop the next domestic terror threat.

  Now that the leadership of New York’s Five Families has been decimated, the question is, has the Bureau learned its lesson? If the events of January 20, 2011, are any indication, the answer is no.

  The “Epic FBI Bust”

  That was a line in the subtitle of a story filed on the website of NBC’s New York flagship station announcing the “FBI’s biggest Mafia bust.” On January 20, 2011, in a massive sweep across three states,80 127 men were arrested and charged with more than eight hundred mob-related crimes.81

  Attorney General Eric Holder announcing the mass Mafia arrests

  (Robert Stolark/The New York Times/Redux)

  Attorney General Eric Holder called it “one of the largest single-day operations against the Mafia in the FBI’s history, both in terms of the number of defendants arrested and charged and the scope of the criminal activity that is alleged.” He went on to say that the massive bust “sends the message that our fight against traditional organized crime is strong, and our commitment is unwavering.”82

  But beyond the headlines and the colorful news footage of multiple “perp walks,” an examination of the indictments tells a somewhat different story. Of the 127 arrested, only thirty were made members. Some of those charged were geriatric mobsters, ages eighty-three, seventy-six, seventy-four, seventy-three, and sixty-nine. Many of the indictments were for petty infractions, including bookmaking, loan sharking, gambling, and possession of contraband cigarettes. One of those indicted was charged in a homicide that took place during a home invasion in 1992;83 one double murder involved a dispute over a spilled drink at a bar in Queens.84

  Yet the cost of this new investigation was enormous. The authorities acknowledged that informants had recorded thousands of conversations by suspected mobsters.85 Seemingly to justify the expense and counter the notion that the Mafia had been degraded, Janice Fedarcyk, assistant director in charge of the FBI’s New York Office, noted that “arresting and convicting the hierarchies of the five families several times over has not eradicated the problem.”86 So much for the 1986 prediction by former SDNY U.S. Attorney Rudy Giuliani that the Mafia Commission case would “crush” Cosa Nostra.87

  But Bruce Barket, who had defended Craig Sobel during the Lin DeVecchio prosecution, disagreed with Fedarcyk, telling Reuters that the Cosa Nostra menace was long ago replaced by a new threat, from Albanian and Russian gangsters. “Privately, law enforcement officials will tell you there isn’t anybody left” in the old-school Italian mob, he said.88

  The question, from a security standpoint, is whether those mass arrests in 2011 amounted to a final attempt by the FBI to maintain its relevance as a mob-busting force at a time when the al-Qaeda threat continues to loom. If that was the strategy, then one of the highest-profile Mafia prosecutions in years proved that the Justice Department still suffers from the same pathology that infected the Colombo war prosecutions.

  The Trial of “Tommy Shots”

  In May 2012, Thomas “Tommy Shots” Gioeli, the accused acting boss of the Colombo family, was acquitted of six homicides by a federal jury, largely because they didn’t believe the testimony of the cooperating witnesses the Feds used to prosecute him.89 It was a kind of replay of the Orena brothers’ acquittal in 1995.

  Gioeli had been one of the shooters who had stalked Joseph Peraino and his son Joe Jr. in the 1982 incident that caused the death of former nun Veronica Zuraw. A onetime Orena loyalist who s
witched to the Scarpa faction during the war, Gioeli was also charged with the murder of Wild Bill Cutolo, who disappeared in May 1999 after he’d been promoted to underboss.90 In October 2008, the FBI started searching a field in East Farmingdale, Long Island.91 The body they unearthed, wrapped in a tarp, was identified as Cutolo’s.92

  Thomas “Tommy Shots” Gioeli

  (New York Daily News)

  Gioeli had also been charged in the 1992 Colombo war pastry shop murders of John Minerva and Michael Imbergamo.93 Since virtually all the evidence against him for the Cutolo and Long Island hits was based on the word of other mobsters, Gioeli walked on the murder charges, though he was convicted of racketeering and murder conspiracy.94 Described in the Times as “a blow to prosecutors,” the limited victory against Tommy Shots was some indication of how far the DOJ can go today in prosecuting cases that hinge largely on the hearsay of other wiseguys.

  “There’s also a question about how Justice should be devoting its resources,” says Lieutenant Colonel Anthony Shaffer, whom I interviewed in September 2012 after the Benghazi attack. “It’s patently clear that al-Qaeda remains a lethal threat. Consider the massive resources the FBI spent in those mass mob arrests and how those resources might be better directed in the years ahead. My main concern with the Bureau and the other intelligence agencies is whether they’ve learned from their mistakes and they’re committed to true reform, or will they continue to defend old ground?”95

  A COINTELPRO vs. the Mafia

  From the mid-1950s to the early 1970s, the FBI ran an illegal domestic spying operation dubbed the Counter Intelligence Program, or COINTELPRO.96 The secret initiative, in which J. Edgar Hoover initially authorized special agents to spy on a series of leftist groups, including the Communist Party and the Socialist Workers Party as well as white hate groups like the Ku Klux Klan, later grew into a domestic intelligence-gathering operation whose targets included the Black Panther Party and a number of antiwar groups during the Vietnam War.97

  When it came to what Hoover termed “Black Nationalist” groups like the Panthers and the Nation of Islam, the Director stated in a memo that “the purpose of this new counterintelligence endeavor is to expose, disrupt, misdirect, discredit, or otherwise neutralize” their activities “to counter their propensity for violence and civil disorder.” Included in the groups Hoover described as “subversive” were the NAACP and the Southern Christian Leadership Conference (SCLC), headed at the time by the Reverend Martin Luther King Jr.98

  The program was reportedly closed down by Hoover in April 197199 but only after a burglary of an FBI field office, in which files were stolen, which threatened its exposure.100 Then, after the Watergate scandal in the early 1970s, a U.S. Senate select committee headed by Democrat Frank Church of Idaho held extensive hearings that probed COINTELPRO and the illegal domestic spying operations conducted by the CIA, first exposed by investigative reporter Seymour Hersh in the New York Times.101

  A fifteen-month investigation by the Church Committee found that FBI headquarters alone had developed more than 500,000 domestic intelligence files on Americans and domestic groups.102 As a direct result of the committee’s investigation, the Justice Department adopted the first set of “Attorney General Guidelines,” to which Lin DeVecchio and other special agents would become subject.103

  Initially established under Attorney General Edward Levi on April 6, 1976,104 the guidelines, which regulated the FBI’s use of confidential informants, were further refined by Benjamin Civiletti in December 1980,105 setting forth strict rules on when the Bureau might sanction the “ordinary” criminal activity of informants.106 As noted, violent crimes like murder by CIs were never authorized.

  A report in September 2005 by the Justice Department’s inspector general, which reviewed the AG’s Guidelines from their inception, concluded that “the partnership between the FBI and DOJ, in making key operational and oversight decisions, has promoted adherence to the Attorney General’s Guidelines and allowed the Department to exercise critical judgments regarding sensitive FBI investigative activities, particularly with respect to its use of confidential informants and undercover operations.”107

  But our analysis of the once-secret files on Gregory Scarpa Sr. (NY 3461-C-TE) demonstrates that, at least until his arrest on September 1, 1992, and for the three decades before that, the FBI conducted what amounted to a COINTELPRO against the Mafia, employing as its central asset a sociopathic killer who acted with utter disregard for human life and the rule of law.

  In November 1974, after releasing a DOJ report on COINTELPRO, then Attorney General William B. Saxbe disclosed that, in addition to the Bureau’s spying on leftists and so-called hate groups, a more secretive category of COINTELPRO targets dubbed “special operations” had never been made public.108 We don’t know if “special operations” was Hoover’s cover name for his secret war against Cosa Nostra, but the memo to the Bureau’s assistant director in January 1966, authorizing Greg Scarpa Sr. to make a second mission to Mississippi for what was termed “a special in the Jackson office,”109 raises the question of whether “34” was part of that undisclosed category of the Bureau’s illegal counter intelligence program.

  The three words on the banner that emblazons the FBI’s seal are “Fidelity,” “Bravery,” and “Integrity.” There’s little doubt that over the decades thousands of special agents have exemplified those first two qualities. It’s time now for the Bureau to reclaim its right to the third. It’s time that the pathology that infected the FBI during its three-decade relationship with Greg Scarpa Sr. is excised and his son shown some mercy. An important first step in that direction would be to grant Greg Jr. a hearing in open court, where all of the evidence of his help to the Bureau can be vetted. The next step would be to offer clemency to Vic Orena, who has paid his price for racketeering after more than eleven years behind bars and, at the age of seventy-eight, deserves to see the light of day.

  ACKNOWLEDGMENTS

  Deal with the Devil was six years in the making. I first proposed the book in the winter of 2007 to Jane Friedman, who was then the president and CEO of HarperCollins, and as we say in the media business, “she bought it in the room.” After I’d written two investigative books critical of the FBI and one that audited the 9/11 Commission, Jane was intrigued by this story of a senior Bureau supervisory special agent who had been indicted for murder as a result of his clandestine relationship with a Mafia killer.

  From that point on, the trajectory of the book took many twists and turns, which accounts for the years it’s taken to come to press. First, there was the aborted DeVecchio trial, after which the transcript was immediately sealed. Then came the first of thirty-two pages of letters from Chicago U.S. Attorney Patrick Fitzgerald threatening to sue me and HarperCollins for libel if we didn’t cease publication of the hardcover edition of Triple Cross, which was critical of his performance as head of the SDNY’s Organized Crime and Terrorism Unit.

  Given who the threat was coming from and out of an abundance of caution, we undertook a re-vetting of the entire book, which took twenty months. The trade paperback edition was published in June 2009 to critical acclaim and support by media watchers on the left and the right, and Fitzgerald never made good on his threats. But the reexamination of every fact in a book that ran 604 pages in hardcover was a daunting task, and that caused me to put this book on the back burner for many months.

  In 2008 I was able to get a copy of the DeVecchio trial transcript. I then obtained more than ten thousand pages of court pleadings in a number of the Colombo war cases and got a copy of the file from the DeVecchio OPR investigation, which ran to almost a thousand pages. I spent much of 2009, after the publication of Triple Cross in paperback, trying to get into the Supermax prison in Florence, Colorado, to interview Greg Scarpa Jr. and Anthony Casso, but I was repeatedly stymied by the Bureau of Prisons, which is a wing of the Justice Department.

  Finally, in the fall of 2011 I was able to interview “Gaspipe,” and
I conducted a number of interviews with Greg Jr. in 2012 after he was moved from ADX Florence to a prison in the Midwest with less restrictive conditions. Over the years I conducted extensive interviews with the Orena brothers and a number of FBI agents, some on active duty who asked not to be identified and some retired. I did many interviews with defense lawyers who had gone to battle with the Feds during the seventy-five Colombo war prosecutions, but I was anxious to know more about the Bureau’s secret dealings with the Grim Reaper, so I approached Angela Clemente, who had filed a federal lawsuit pursuant to the Freedom of Information Act to get what eventually amounted to the 1,153 pages in airtel memos, teletypes, and 209s.

  I’d first encountered Angela in 2004 when I was finishing Cover Up, my book on the 9/11 Commission. She was able to get me dozens of FBI 302s documenting Scarpa Jr.’s Yousef sting, many of which can be accessed at my website, http://www.peterlance.com/wordpress/?p=682.

  With no formal training, this single mother from New Jersey who describes herself as a “forensic investigator” is one of the best researchers of organized crime–related material I’ve ever encountered. After I was able to get the first five hundred pages released via her FOIA suit, there were no more pages forthcoming from the website that allows access to federal court case pleadings. So it wasn’t until the fall of 2011 that I received the remaining 653 pages directly from the Bureau with the help of a Washington, DC, federal judge.

  It was important for me to get Lin DeVecchio’s perspective in all of this. I had been scheduled to talk with him on the day of his indictment, March 30, 2006, but after he left the Brooklyn Supreme Court surrounded by that phalanx of former FBI agents, that didn’t happen. I wrote to his lawyer Douglas Grover requesting an interview and never heard back from him, so I decided to wait for Lin’s book to come out to get his side of the story. We’re Going to Win This Thing, which had been scheduled for publication in December 2009, didn’t come out until February 2011, so that was another cause for my delay in delivering Deal with the Devil.