THIRTY INDIVIDUALS INDICTED IN MULTI-MILLION DOLLAR OFF-SHORE SPORTS BETTINTHIRTY INDIVIDUALS INDICTED IN MULTI-MILLION DOLLAR OFF-SHORE SPORTS BETTING OPERATIONG OPERATION

by Dirty on October 21, 2009

FOR IMMEDIATE RELEASE
WEDNESDAY, OCTOBER 21, 2009

THIRTY INDIVIDUALS INDICTED IN MULTI-MILLION DOLLAR OFF-SHORE SPORTS BETTING OPERATION

Charged With Enterprise Corruption, Promoting Gambling and Money Laundering

Queens District Attorney Richard A. Brown, joined by New York City Police Commissioner

Raymond W. Kelly and Patricia J. Haynes, Special Agent-in-Charge of the New York Field Office

of the Internal Revenue Service (IRS), today announced the indictment of 30 individuals and one

corporation on charges of unlawfully operating a sports betting enterprise that stretched from Queens

County to Nevada and from Rochester to Florida. It is estimated that the ring took in more than $567

million over a 28-month period by accepting wagers on a wide variety of sporting events – ranging

from professional football, basketball, hockey and baseball to college basketball, among others.

District Attorney Brown said, “The defendants are accused of operating an incredibly

lucrative gambling operation – taking in more than $20 million a month, on average. Such

unlawfully earned profits are often – and easily – diverted to more insidious criminal enterprises. In

fact, the investigation uncovered evidence that the enterprise had links to both the Gambino and

Genovese crime families.”

The District Attorney continued, “Illegal gambling is not a victimless crime. Those who

participate in these criminal enterprises often use threats, intimidation and even physical force to

collect debts and oftentimes charge usurious interest rates on outstanding debts. In addition to our

NYPD and IRS partners, I want to thank our federal law enforcement colleagues and police

authorities in other states for their cooperation and efforts in this investigation. So massive was the

enterprise that only with their assistance could we bring these defendants to justice.”

Commissioner Kelly said, “Gambling proceeds is the fuel that drives organized crime. The

staggering amount of money in this case demonstrates just that. In this instance, however, the

bookies ran out of luck.”

IRS Special Agent-in-Charge Haynes said, “Illegal gambling is a complex financial crime.

Violators often use computers as tools to conduct financial transactions to launder money. Our

agents use their unique financial and forensic computer skills to trace the flow of the money and

unravel these financial transactions.”

– 2 –

(MORE)

One of the ring’s alleged bookmakers – Joseph J. Fafone – was arrested yesterday at the

airport in Rochester New York, where he was waiting to board a flight to Panama. He was carrying

nearly $24,000 in cash on his person. Of the other ring members, seventeen were arrested locally

today and are awaiting arraignment in Queens Supreme Court. Nine other individuals were arrested

in upstate New York, Florida, Nevada and Illinois. Three others – including two in Panama – are

presently being sought and search warrants are being executed across the country to track down

assets connected to the ring. Presently, more than $3 million in cash has been seized. The arrests

stem from a 38-month investigation known as “Operation Betting It All.”

The defendants are charged with enterprise corruption – a violation of New York State’s

Organized Crime Control Act – as well as money laundering, promoting gambling and conspiracy.

If convicted, the individual defendants each face up to 25 years in prison. The corporate defendant

faces a fine of up to $10,000 or double the amount of the illegal gain.

In addition to the criminal charges, twenty of the defendants are being sued civilly and have

been named as respondents in a $125 million civil forfeiture action filed in Queens Supreme Court

by the District Attorney’s Special Proceedings Bureau which alleges that they engaged in a criminal

enterprise that promoted illegal gambling activities and generated illegal wages.

District Attorney Brown said that, according to a 131-count indictment filed in Queens

County Supreme Court the gambling ring promoted illegal sports betting in Queens County and

elsewhere and that the top two defendants – alleged bookmakers Joseph J. Fafone and Eric Davis

Harp – used various Internet websites, including betallsportshere.com, justwagers.com, betmsg.com,

betonline.com, and betrr.com, as well as toll-free telephone numbers to accept wagers. The

defendants also allegedly controlled a non-traditional “wire room” in the form of an off-shore,

Internet gambling service used by bettors and runners to actually place their wagers. It is alleged that

the ring used the off-shore wire room – located in Panama – to maintain the gambling accounts of

numerous runners and bettors through the Internet websites in an effort to evade law enforcement

detection through traditional methods.

Law enforcement crackdowns on traditional mob-run wire rooms have led to the use by

illegal gambling rings of off-shore gambling websites where action is available around the clock.

Bettors can click on an off-shore gambling website over the Internet and be assigned individual login

codes and passwords. Their wagers and win-loss amounts are recorded in “sub-accounts”

maintained in the accounts of “runners” and “agents.” These gambling websites typically store their

information on computer servers located outside the United States – such as in Panama – and

“bounce” their data through a series of server nodes in an effort to evade law enforcement.

In addition to Fafone and Harp – who allegedly were the bookmakers of the enterprise who

controlled and oversaw the entire operation – the indictment charges that nine other defendants –

Joseph Fafone, Sr., Thomas Farley, Gail Harris, Edward P. Kenny, Lester Klein, Louis P. Lippa,

Amanda Mercer, Robert Rasmussen and David Valerio – worked as “money collectors” and

“distributors” and were responsible for exchanging, distributing, delivering and transferring

gambling proceeds between members of the organization, including to and from agents/runners.

Some of the collectors were also allegedly involved in exchanging, distributing, delivering and

transferring gambling proceeds through various financial institutions.

– 3 –

(MORE)

Four other defendants – Jerry Dicresce, Edward LaRocco, David Strickland and Robert

Wehnert – are alleged to have been “master agents” with several subordinate agents/runners

reporting directly to them.

The indictment additionally charges that thirteen of the defendants worked as

“agents/runners” – Robert Aglialoro, Andrew Berg, John Bowling, Louis Cassero, Joseph

Catalanotto, Philip Cesario, David Goldman, Jonathan Piansky, Joseph Pontarelli, Matthew

Schmalacker, Louis Todisco, Michael Rizzi and Robert Stampf – and were responsible for soliciting

new bettors to the organization, maintaining existing bettor relationships and meeting with bettors

to collect gambling losses and payout winnings.

While bookmakers Fafone and Harp allegedly visited the Panama wire room on occasion,

it is alleged that two other defendants in the ring – Andre Lepiz and Mike Sheridan– were in charge

of the day-to-day running of the room and allegedly acted as intermediaries with others involved in

the operation.

The corporation, JJF Consulting Services, Inc., is allegedly owned by Joseph J. Fafone and

operated out of his personal residence. The corporation was allegedly a shell corporation that was

used as a “money launder” to funnel and obscure the illegal gambling proceeds.

District Attorney Brown said that the investigation leading to today’s indictment began in

September 2006 when detectives from the NYPD’s Organized Crime Investigation Division

developed information about an illegal sports betting operation and began a joint investigation with

the District Attorney’s Organized Crime and Rackets Bureau. The investigation included physical

surveillance, intelligence information, use of an undercover officer and court-authorized electronic

eavesdropping.

According to the indictment, between September 2006 and January 2009, the defendants

conspired to make money illegally through the operation of an unlawful gambling enterprise that

accepted bets on sporting events ranging from as little as $5 to as much as $20,000 on a single game.

According to the indictment, after a bettor placed a bet either through the website or through

one of the organization’s toll-free telephone numbers, the bettor collected his winnings or paid any

losses by interacting with an agent/runner either in person or through interstate commerce. The

agent/runner, in turn, met with a money collector to turn over any gambling debts the agent/runner

collected from his bettors and/or to receive any money from the money collectors that the

agent/runner’s bettors won. The money collector/distributors, in turn, were responsible for the

collection and distribution of illegal gambling proceeds between the bookmakers and the

agents/master-agents.

The investigation was conducted by the NYPD Detective Joseph Chimienti of the Organized

Crime Investigation Division of the Organized Crime Control Bureau, under the supervision of

Lieutenant Jack Iacovou and Detective Matthew Murphy of the NYPD’s Asset Forfeiture Unit under

the supervision of Sergeant Stephen Scalza.

Also assisting in the investigation were IRS Special Agent John D. Lopez and IRS

Supervisory Special Agent Russ Richardson; State of Nevada Gaming Control Board Enforcement

Division Special Agents James Taylor and Anthony Vincent and Agent Jesse Prieto; Sean O’Malley,

– 4 –

(MORE)

Deputy Chief Investigator, Enforcement Division, Federal Reserve Bank of New York; and Assistant

United States Attorney Yasmin Best of the United States Attorney’s Office for the Northern District

of Illinois and Assistant United States Attorney Tanya Y. Hill of the United States Attorney’s Office

for the Eastern District of New York.

Assistant District Attorney Christine M. Maloney, of the District Attorney’s Organized Crime

and Rackets Bureau, is prosecuting the criminal case under the supervision of Assistant District

Attorney Gerard A. Brave, Bureau Chief, and Mark L. Katz, Deputy Chief, and Assistant District

Attorney David S. Zadnoff, of the District Attorney’s Special Proceedings Bureau, is handling the

civil case under the supervision of Assistant District Attorneys Anthony M. Communiello, Bureau

Chief, and Oscar W. Ruiz, Deputy Chief. Both the criminal and civil matters are under the overall

supervision of Executive Assistant District Attorney for Investigations Peter A. Crusco and Deputy

Executive Assistant District Attorney for Investigations Linda M. Cantoni.

It should be noted that an indictment is merely an accusation and that defendants are

presumed innocent until proven guilty.

ADDENDUM

* denotes those defendants presently not in custody.

ALLEGED BOOKMAKER (2)

Joseph J. Fafone, 48, of 6226 Pheasants Crossing, Farmington, New York

Eric Davis Harp, 36, of 230 East Flamingo Road, Las Vegas, Nevada

ALLEGED MONEY COLLECTOR (9)

Joseph P. Fafone, 70, of 7495 La Paz Boulevard, Boca Raton, Florida

Thomas P. Farley, 65, of 7 Ash Street, Floral Park, New York

Gail R. Harris, 55, of 2445 NW 64th Street, Boca Raton, Florida

Edward P. Kenny, 59, of 1155 Hillsboro Mile #708, Hillsboro Beach, Florida

Lester J. Klein, 66, of 166-41 Powell Cove Boulevard, Whitestone, Queens *

Louis P. Lippa Jr., 61, of 26-3 Great Wood Court, Fairport, New York

Amanda L. Mercer, 39, of 1058 Castiron Ridge Court, Henderson, Nevada

Robert J. Rasmussen, 42, of 7432 West 161st Street, Tinley Park, Illinois

David Valerio, 61, of 81 Meriden Street, Rochester, New York

ALLEGED MASTER AGENTS (4)

Jerry Dicresce, 75, of 1 Vincent Road, Apt. 3J, Bronxville, New York

Edward LaRocco, 61, of 68 Roger Drive, Port Washington, New York

Robert Wehnert, 63, of 69-26 62nd Avenue, Middle Village, Queens

David Strickland, 54, of 22837 Ponderosa Drive, Boca Raton, Florida

ALLEGED AGENTS/RUNNERS (13)

Robert Aglialoro, 38, of 57-44 81st Street, Middle Village, Queens

Andrew Berg, 48, of 60 Knollwood Road, Roslyn, New York

John Bowling, 60, of 9425 Boardwalk Lane, Orland Park, Illinois

– 5 –

ALLEGED AGENTS/RUNNERS (continued)

Louis Cassero, 36, of 1771 Washington Avenue, Seaford, New York

Joseph Catalanotto, 52, of 66 East Shore Road, Huntington, New York

Philip Cesario, 68, of 303 East 60th Street, New York, New York

David Goldman, 67, of 401 East 80th Street, New York, New York

Jonathan Piansky, 39, of 9-20 166th Street, Whitestone, New York

Joseph Pontarelli, 66, of 19 East 80th Street, New York, New York

Michael Rizzi, 38, of (home address unavailable), Brooklyn, New York

Matthew Schmalacker, of 25, 215 Middle Neck Road, Great Neck, New York

Robert Stampf, 74, of 30-61 49th Street, Astoria, Queens

Louis Todisco, 42, of 166-07 20th Avenue, Whitestone, Queens

ALLEGED WIRE ROOM MANAGER (1)

Mike Sheridan, (age unknown), of Via Brasil, Calle 50, Display Plaza #1, Panama City, Panama *

ALLEGED WIRE ROOM ACCOUNTANT (1)

Andre Lepiz, (age unknown), of Via Brasil, Calle 50, Display Plaza #1, Panama City, Panama *

ALLEGED CORPORATION (1)

JJF Consulting Services, of 6226 Pheasants Crossing, Farmington, New York

Printed with Permission From Our Good Friends Over at Major Wager

Leave a Comment

Previous post:

Next post: