Union Jacked

How DC 37 became America's most indicted municipal union

This evolutionary process has produced DC 37's double personality: strong in its control over the 123,000 members, but easily pushed around by Rudolph Giuliani; completely dominated by AFSCME President Gerald McEntee, and quietly penetrated by the mob.

It's not easy to see how mobsters got a foothold in a civil service union like DC 37. AFSCME can't control hiring like the construction unions; there are no deliveries to stop the Teamsters' choke point; mobsters can't even threaten a strike to get a shakedown because of the Taylor Law. Besides, the union mainly represents nurses' aides, school lunchroom attendants, and office clerks— not iron workers, carpenters, or longshoremen. But it was just this perceived lack of "muscle" that allegedly led Victor Gotbaum to bring in longshoreman boss Anthony Scotto, in the often violent battle with the Teamsters for control of city hospital workers. (Gotbaum denies that Scotto provided strong-arm assistance in the Teamster wars.)

Scotto, a convicted extortionist, whose wife Marion runs an Italian restaurant— Fresco by Scotto— married into the Gambino crime family. Marion's uncle was Albert Anastasia, Murder Inc.'s "Lord High Executioner." Scotto's father-in-law was "Tough Tony" Anastasia, the Brooklyn docks boss. When Marion's dad died in 1963, 29-year-old "Young Tony" succeeded him as president of longshoremen's local 1814. Under Carlo Gambino, "the Boss of all Bosses," Scotto rose quickly to caporegime.

Organized crime never had a more prominent political leader than Scotto— and organized labor never had a better fundraiser. He raised $1 million for Hugh Carey's 1974 gubernatorial campaign; $50,000 for Cuomo's lieutenant governor's race. It was the $350,000 Scotto raised from ship owners, however, that got him convicted of extortion in 1979. "I testified at his trial," Gotbaum recalls. "I loved Anthony. We had a wonderful relationship."

Because he was close to Scotto, Gotbaum also got close to Scotto's attorney, Bertram "Bud" Perkel. "A fox in the hen house" was the charge when Scotto had Perkel appointed to the New York Port Commission. In 1965, Gotbaum retained Perkel to be the union's outside counsel, and then counsel to DC 37's benefit funds. And Perkel is still there, receiving $205,000 in yearly compensation as counsel, according to federal records. "My firm [Baker & Botts] gets the compensation," Perkel explained in a phone interview. "I have associates in my office that help me."

Perkel spent Wednesday night celebrating with Helen Greene at 125 Barclay Street.

I asked Perkel, who was the union's counsel during what may be the two biggest labor corruption scandals in New York history— the fall of Anthony Scotto and DC 37's record 27 indictments— if he felt any personal responsibility. Perkel chuckled softly, "It was tragic to me. I've always known that there's a certain amount of ethical flexibility in all corporate union relations. But I was always on the side of the angels. No matter who was running the show, they never touched the benefit funds."

What about the funds' $250,000 loan to indicted local 371 president Charlie Hughes, made in 1992, due in 1995, but still not paid back, according to the most recent federal records? "I had absolutely no control over that," said Perkel. "If my recollection serves, the loan was made because a renovation was going on."

"Did he check to see if there really was a renovation going on?"

"We have no ability to either collect or determine the terms of the loan, or see if the renovation exists," he explained.

Besides ties to the Gambinos and their associates, the other prominent crime family with connections to DC 37 is Columbo's. Last year the Daily News reported that, in 1986, when Gotbaum ran for central labor council president, he asked reputed mobster William "Wild Bill" Cutolo for help. They met twice. According to Tommy DiNardo, an associate of Cutolo's who was head of the DC 37 local that represented boiler-room workers, Gotbaum asked him to set up the meeting. Gotbaum denies it. "Come on, I didn't even know the fucking guy," he insisted. "My only real impression of Cutolo was that he wasn't my kind of guy. Flashy. Rings. I met him in his candy store. Then we went to a restaurant on the Lower East Side."

It was under Gotbaum that a mural portraying blue-collar union officials with ties to the Columbo crime family— including Frankie Morelli ("Frankie the Gent"), president of 983— went up. The three were dressed up like '30s mobsters, leaning against a car, carrying submachine guns. Underneath the license plate was a sign: "Join the union or else!"

Asked about the mural, Gotbaum said, "It could be. It's so insignificant to me. But I don't recall it. A lot of Italian [leaders] had some members, 'boys of the street.' If it ever affected the union," Gotbaum said, he would have acted.

In 1984, Gotbaum backed "Frankie the Gent" against non-mob incumbent Joe Zurlo for DC 37 President. Gotbaum minimizes the significance of the race: "The office wasn't that important. You know, don't you, that the presidency of DC 37 is just an honorary position." As for mob-connected unionists in general, Gotbaum explained, "For me, I didn't give a shit as long as they kept it out of the union. Oh, there were incidents. I remember one time, some one came to me: 'Vic, they're running numbers in the hospitals.' I told them 'If they stay the fuck out of the union, I'm not bothered.' It was later that I learned there were all these kickbacks."

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