Hiding Her Cards

Every time Gerry Ferraro runs for office, she is caught in the crosshairs of her husband's sleazy business practices. Now she's positioned herself for casino gold by dumping the partner who found her Foxwoods deal.

Gattoni met Zaccaro in 1987, spotting him with Ferraro on an airplane flight from Vermont. He initially tried to interest Zaccaro in a Vegas property, and over the years, he stayed in touch, eventually calling Zaccaro to offer the options on the two parcels that now comprise the hotel site. Zaccaro concedes that their deal, from the beginning, was that Gattoni, who gave Zaccaro a financial statement listing a mere $6000 in assets, would coordinate the project day-to-day, while Zaccaro would pay the immediate expenses and arrange the long-term financing.

The Zaccaro-Ferraro family is by now so deeply committed to the project that it has as much as $2.3 million tied up in it. The stake includes four liabilities recorded on Ferraro's disclosure statement that top out at over $1 million. Those have been collateralized by everything, from the family home in Queens to the office Ferraro jointly owns with Zaccaro. In addition to borrowing to get the hotel off the ground, Ferraro's filing cites a Zaccaro loan to North Stonington of as much as $500,000, as well as his $250,000 cash purchase of a third parcel adjacent to the site in May 1997.

With her own financial well-being riding on the casino-related project, Ferraro unabashedly championed casinos in one of her final CNN appearances on Crossfire. On December 26, 1997, without ever mentioning her own stake, she ridiculed Tom Grey, head of the National Coalition Against Gambling, saying there are also "compulsive shoppers," and asking if Grey would "close down every mall" because of them.

Citing how much her 90-year-old mother-in-law loved Atlantic City, Ferraro said, "People believe it's helped them, for instance, on some of these reservations where Native Americans now are making good money." When Grey replied that all Foxwoods has produced are 500 Indian millionaires, Ferraro said the "reservations were starving," and "the kids were not being educated," suggesting that the casino was "helping" and "has been a benefit." She unconditionally endorsed gambling as "entertainment."

Pressed by the Voice about why Ferraro did not mention her North Stonington investment on CNN, a Ferraro spokesperson told the Voice that the project was "not casino-related," tying it instead to Mystic Seaport, nearby golf courses, and a possible amusement park. Her attorney, however, in an appeals brief filed this month in Connecticut, said the location was "unique" solely because "it is adjacent to the Mashantucket Pequot reservation and casino."

Beyond the nastiness of Gattoni's treatment, Ferraro's association with the hotel project, just like her partnership with Zaccaro in a building tenanted by pornographers in 1992, has exposed her to the trademark trappings of most Zaccaro deals: A convicted felon has been spearheading the project. It features questionable tax maneuvers and curious loans.

In addition to replacing Gattoni with John Zaccaro Jr., who was convicted on felony drug charges in Vermont in 1988, Zaccaro increasingly began to rely on another felon, Emmet Delany, to push the project. In 1992, Delany pled guilty in White Plains to five federal felony counts, ranging from witness tampering to mail fraud. He started working as Zaccaro's agent on the hotel project in early 1996 and was deeply involved for at least two years, negotiating a management contract with Crowne Plaza to run the hotel, and meeting with investment and mortgage firms about financing it.

Zaccaro's office, where Ferraro has maintained a desk since at least 1986, takes messages for Delany, who cooperated with the government in making numerous real estate fraud cases. He was not sentenced until May 1997, when he got two years probation and a $4000 fine on each of three remaining counts. Delany was represented by the same law firm that represented Zaccaro in his last criminal case in 1987, when he was acquitted on bribery charges involving the city's cable contract. The firm -- Morvillo, Abramowitz -- remains so close to the family that its members contributed $5000 to the Ferraro campaign.

Ferraro's spokesperson attempted to put some distance between Zaccaro and Delany, indicating that Delany "has absolutely no role in the family business" -- a denial dependent on the tense of the verb. Zaccaro testified in October that Delany was still working for him then, one of a hundred references to Delany in the transcript. If the disbarred attorney has since departed, the secretary who answered the phone last week didn't know it.

Ironically, with all this criminal baggage on the Zaccaro side of the dispute with Gattoni -- including Zaccaro's conviction on a fraud misdemeanor charge -- it was Zaccaro who hired detectives to investigate Gattoni at the time of the split. Zaccaro conceded in testimony that he'd even invited Gattoni to dinner at his son's restaurant, obtained a copy of Gattoni's credit card number, and run a credit check on him.

Indeed, Zaccaro detectives looked unsuccessfully in several states for a criminal record on the mysterious Gattoni, whose prior business and current whereabouts are unknown even to members of his family contacted by the Voice. After reimbursing Gattoni's "expenses" for years and forming three corporations with him, Zaccaro suddenly decided, as he put it, that he "didn't know Gattoni very well," and launched a belated but full-scale search for usable negatives.

Previously, Zaccaro had shown no concern about Gattoni's amorphous past, or Delany's conviction, or even his own and his son's criminal history, though the hotel project was closely tied to the highly regulated casino industry. According to former Foxwoods president G. Michael Brown, Zaccaro met with him to actively pursue a block-of-rooms rental relationship with the casino, which might have subjected the hotel's ownership and management to regulatory review.

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