By Jared Chausow
By Katie Toth
By Elizabeth Flock
By Albert Samaha
By Anna Merlan
By Jon Campbell
By Jon Campbell
By Albert Samaha
You'd guess that being a union delegate representing workers at the city's school-bus lines would involve the usual tasks: handle grievances, big and small; go to bat for the members when the boss busts chops; make sure management doesn't ride roughshod over the contract. The usual.
But ex-school-bus driver Anthony Rinaldo says he found out that there was more to collect than just grievance forms. In September 2000, shortly after Rinaldo began to work for his union, he went to meet with a school-bus operator, a woman named Rae Fouché. After the meeting, Rinaldo said the bus operator handed him an envelope. "Give this to Sally," she said.
Rinaldo got the picture. The envelope had that special stuffed-with-cash feel to it. He also knew "Sally" to be his boss, Salvatore Battaglia, who was then the leader of Local 1181 of the Amalgamated Transit Union and its 15,000 members. Rinaldo did as asked. When he delivered the envelope, Battaglia thanked him.
This transaction, Rinaldo confessed last fall to agents of the FBI and the U.S. Office of Labor Racketeering, was repeated "a number of times." The envelopes got fatter, he said, when Fouché won more bus routes from the city's school department in September 2003. After this expansion, Rinaldo said, Battaglia told him to do his duty: "Pick up the money," the president told him. So he did. Over the next 10 weeks, Rinaldo said, he conveyed $10,000 each week back to his boss. He knew how much was in the envelopes because he carefully counted out the bills in front of the bus owner to avoid any misunderstanding.
His reason for doing all this was simple office politics, Rinaldo told the agents. "Rinaldo felt that if he did not pick up the money," the agents wrote in a memo, "Battaglia would put him on 'the pay-me-no-mind list.' " This is the same list that haunts all assistants to powerful people who fear losing their jobs due to failure to display adequate loyalty.
Rinaldo said he consulted another ex-delegate, Sal Ingolia, about relaying the payoffs. He said Ingolia, who also told the feds about his own role in the bribe relays, shared his simple philosophy about such things. "It is what it is," Ingolia told him, adding: "You do what you have to do."
There were also rewards. Around Christmastime, Rinaldo and Ingolia both acknowledged, Battaglia would give them some extra cash in addition to the regular union bonuses. And after Fouché's gravy train came in, the union president handed Rinaldo his own envelope, containing some six or seven thousand dollars. "This is from me," Battaglia told him.
This picture of crooked-business-as-usual in the city's school-bus workers' union has emerged from a continuing federal probe of mob corruption in the city's school-bus industry. The first charges came in July 2005, when Battaglia and two other union officials were arrested along with a slew of Genovese crime-family figures, including a legendary mobster named Matthew "Matty the Horse" Ianniello, who was said to control the union. Battaglia was accused of lying to a grand jury to help keep Matty the Horse out of trouble.
The photos of their union leaders in handcuffs alongside organized-crime figures worried many members of the union, who wondered why Battaglia and his cronies remained in charge even after the indictments. The head of the parent body, the Amalgamated Transit Union, said there was nothing to worry about. "The officers and executive board members and stewards are continuing to effectively carry out their responsibilities on behalf of the membership they represent," ATU president Warren George wrote to a dissident group called Members for Change, which had pressed him to intervene.
The national union continued to insist all was well even after the local's second top official, an aging alleged mobster named Julius "Spike" Bernstein, was rearrested in June 2006 on charges that included taking payoffs to let some companies remain non-union. When the feds busted Battaglia again a few months later for taking his own bribes, they insisted as a bail condition that he take what was politely called "a sabbatical" from running Local 1181. At that point, the national union stepped in, assigning trustees to run the local.
But while the top two culprits at the union have been dispatched (Battaglia pled guilty last month; Bernstein died in October at age 86), most of the rest of the executive board from the old regime has remained undisturbed. Trustee Tommy Mullins has insisted that a pair of bad apples doesn't mean everyone's rotten. But evidence gathered in the ongoing investigation—including the envelope-delivery episodes that former delegates Rinaldo and Ingolia described—suggest that the corruption at the top filtered down through the ranks of middle management.
Rinaldo, who quit the local in 2004, told the feds that he started meeting mob stars right after he became a delegate. Spike Bernstein soon took him to meet Ciro Perrone, another aging Genovese gangster. Perrone, who also pled guilty in the case, ran a nearby Queens restaurant, Don Peppe's, that served as a regular meeting place for mobsters and union bigs. Bernstein also had Rinaldo drive him to a funeral for Matty the Horse's brother, where Rinaldo was introduced to the big man himself. Spike assured Rinaldo with pride that he was "best friends" with the Horse.
It was good to have friends. Another former delegate, Joseph Armetta, told Rinaldo that he got his own union post courtesy of Perrone. "The guy around the corner put me here," Armetta told Rinaldo, referring to the restaurant owner. (Armetta abruptly quit the local after trustee Mullins took over.)
Rinaldo also said he was told by Battaglia and Bernstein that a pair of brothers who were close to Armetta and who retain substantial influence at the local had gotten their jobs with the union thanks to connections with yet another Genovese figure. Paul and Nick Maddalone allegedly had a hook with a Staten Island–based hood named Joey Ida. Battaglia told Rinaldo that he thought the Maddalones were "sneaky" and "viewed them as a threat."
Spike Bernstein also told Rinaldo that at one point Paul Maddalone was being considered as financial secretary for the union. First, however, he had to pass muster with Matty "the Horse" Ianiello, who interviewed the candidate at a table at Don Peppe's. Things didn't work out, however. Rinaldo described the situation this way: "During the meeting, Maddalone repeatedly asked about a position for his brother, Nick. Ianniello stated that no position was available for Nick. When Paul protested, Ianniello stated, 'Your brother is a piece of shit.' " According to Rinaldo, the meeting then ended and Paul Maddalone did not get his promotion.
Both brothers remain as delegates on the local's executive board, earning $114,000 each. When Rinaldo spoke to the feds last year, he predicted that once Battaglia's trial was over, Paul Maddalone would run for president to replace him.
Neither Maddalone returned messages left at the union and with a union spokesperson.
As for Rinaldo and Fouché, both cut immunity agreements with the government in exchange for their cooperation in the investigation, as did former delegate Sal Ingolia.
"She was a victim," said Jerome Karp, Fouché's attorney. Attorneys for Rinaldo and Ingolia both declined comment.
After taking over, trustee Mullins hired outside auditors to go over union operations. He also retained Bruce Maffeo, a former federal prosecutor with experience prosecuting organized crime. Maffeo said that so far one delegate—an apparent reference to Armetta—and several vendors have been removed, and that the trustee was cooperating "fully" with the U.S. Attorney's investigation.
Maffeo said he hadn't seen Rinaldo's allegations but that his probe continues. "If there is a documented assertion of knowing association with organized crime, the trustee would act, as he has in the past, to take immediate and appropriate action," he said.