Infernal Racket


When Saul Heifetz, a 68-year-old contractor with alleged mob ties, was faced with a demand to pay several minority construction workers at their correct union rates, his response was quick, emphatic, and revealing. “No. I am not paying no fucking nigger $600 a day,” said the builder.

The comment, made in Gebruary 1999, was captured on government wiretaps, transcripts of which were obtained by the Voice. And while those 11 cold words don’t in and of themselves constitute criminal conduct, they are part of the disturbing backdrop of a massive and still unresolved organized-crime racketeering case brought three years ago by the office of Manhattan District Attorney Robert Morgenthau.

Heifetz still hasn’t had his day in court on the charges, but he was one of more than three dozen people, including mob chiefs and soldiers, union leaders, and businessmen, who were snared in the case and accused of robbing taxpayers and jilting workers.

It was one of a series of investigations demonstrating the way the Mafia reaches deep into the lives of working-class New Yorkers. It also showed that despite the mighty arsenal at the government’s disposal—including commissions, special strike forces, and racketeering laws—the mob still maintains a persistent influence in the business of constructing buildings here in New York. In one telling illustration, police detectives working the case secretly watched as a powerful Mafia soldier named Anthony “the Razor” Pezzullo drove his white Cadillac early each morning to the work site where the Riverside South high-rise complex on Manhattan’s West Side was then being erected by mega-developer Donald Trump. There, Pezzullo engaged in whispered conversations with top officials of half a dozen unions at work on the site, including the operating engineers, bricklayers, and ironworkers.

The case has also shown that the mob hasn’t altered its basic game plan very much. The schemes described by prosecutors are similar to scores of others that have provided grist to past law enforcement efforts: Morgenthau said the members of the criminal enterprise had rigged bids and bribed labor officials as a means of siphoning off millions of dollars from both public and private construction projects. The district attorney, who has been pressing such cases since the 1960s, when he was part of Robert F. Kennedy’s Justice Department, estimates that the arm-twisting had imposed a “mob tax” of at least 5 percent on the value of the contracts.

One of the ways this was accomplished, Morgenthau explained, was that while contractors were obligated under city and state laws to pay their workers a so-called “prevailing wage” set at approximately the same level as union contract rates, special deals with mobsters and corrupt union officials allowed them to avoid doing so. In turn, contractors allegedly pocketed the often substantial difference between what they claimed to be paying for labor and their actual costs, sharing the bonus with their mob cronies.

This particular investigation was dubbed the “Luchese case” because that is the name of the crime family to which several of the lead defendants allegedly owed their allegiance. Top of the list was a Yonkers-based contractor and restaurant operator named Steven Crea—”Stevie Wonder” to his admiring crew members—who is considered the acting boss of the Luchese clan. An ex-fighter with a lantern jaw, Crea was alleged to be the power behind numerous construction firms that built everything from modular schools to luxury homes. Among Crea’s close friends, wiretaps showed, were Bronx car dealer and Democratic political big Dick Gidron, and Burt Young, the actor who often plays gangsters. Young was so attuned to Crea’s world that when police raided the mobster’s home, Young called out of concern. “You got company, bad company with you?” asked the actor. “Yeah,” responded Crea. “Oh, shit,” his friend responded.

Heifetz, a resident of Rockland County who has been running construction firms for years in the Bronx and upstate, is accused of using mob ties to rig bids and cheat on school contracts. During the investigation, police watched as Heifetz drove to Crea’s office in his truck, counted out a thick stack of cash, and then put it in a brown paper bag and walked inside. Delayed by motions and counter-motions, the case has limped along on the court calendar. In the meantime, more than two dozen of the original defendants have pleaded guilty, and several of those remaining, including Crea, are negotiating plea bargains. Heifetz, along with the city carpenters’ union leader, is one of a handful of defendants who have insisted on taking their cases to trial.

“It never should have been brought,” said the contractor last week when reached on the new work phone number he acquired after learning that his old phone was a government listening post. His attorney, Kyle Watters, echoed that claim. “My client was a victim,” he said.

Prosecutors and organized-crime cops monitored more than 50 wiretaps during the four-year probe, an immense and complex juggling act. For the most part, Crea and other savvy individuals, ever wary of government eavesdroppers, avoided making incriminating statements over their own phones. Heifetz, however, was a talker. His remarkably outspoken and candid comments about his business practices were captured on tape, comments that shed a rare light on a shadowy world. Morgenthau’s “mob tax” analysis is one way to try to persuade the public why it should care about mob corruption. But Heifetz’s unguarded descriptions offer a far more compelling lesson about the human cost of the underworld’s economic policies.

Heifetz’s company, he explained on the tapes, was non-union, and his workers were dependent on him for a regular living. Unlike union workers, who generally go from job to job, Heifetz used the same team year-round. But he was haunted by fears that those same workers might someday realize they could improve their lot.

“I make my living with these guys,” Heifetz was heard telling another contractor in the fall of 1998. “Without these guys, I’m out of business. [It’s] not a question of me being a masonry contractor. I’m not. I’m a fucking Simon Legree with a fucking load of slaves. You don’t understand that? I lose my fucking slaves—they start realizing they’re people—I’m out of business. And the intent was not for me to go out of business.”

In the same conversation, he added: “My guys got no books,” referring to membership cards carried by union construction workers. “They’re shit heels for $150 a fucking day. If you want to use them, you got them.”

When trade union organizers, suspicious that improper wages were being paid, started nosing around one of the builder’s jobs, a foreman named George suggested that Heifetz add a handful of union workers to the crew as a way of easing the pressure. Heifetz was adamantly opposed. Such mingling could be dangerous, reasoned the contractor. “I don’t want them mixing in there with union guys,” he said. “I don’t want them there. I’m going to lose them.”

Despite scores of enforcement agents at virtually every city and state agency, violations of prevailing-wage laws are epidemic, according to both unions and regulators. The Bureau of Labor Law in the city comptroller’s office reports that new cases roll in at the rate of more than 100 a year, most of them spurred by unions angry at flagrant violators. Since January 2002, the office has assessed wage underpayments of more than $3 million. The violations, say officials of the carpenters’ and laborers’ unions, which have both urged crackdowns, are just the tip of the iceberg.

“There is a ridiculously high level of noncompliance with the laws,” said Steven Levine, a veteran prevailing-wage expert and vice president of the New York and Long Island Association of Certified Fraud Examiners. “So many people—taxpayers, workers, honest contractors—get hurt so badly by it.”

Union organizers involved in campaigns to win over workers at firms like Heifetz’s say the vast majority of non-union construction workers receiving subpar wages are recent immigrants, fearful that demands for better pay could lead to deportation. Even so, Heifetz voiced concern about rebellion in the ranks.

“They may be immigrants and what, [but] they’re not stupid,” he told his foreman. “Come on. They’re not dummies. They talk. I threatened them, you know. I tell them, ‘You want to work all year round? Or do you want to sit on the fucking bench all year round?’ ”

As for the unions, Heifetz and others expressed scorn for those officials refusing to play ball. “I go around them,” Heifetz said of the labor organizers. “They hate my guts.” If they wouldn’t agree to scams, the unions were to be manipulated. Nick Poniatowski, a contractor who provided a mainly Polish workforce to Heifetz and who pled guilty to filing false records in the case, explained that he kept extra union books in a desk drawer to send out with his workers in case they were needed.

Pezzullo, the Luchese wiseguy who lurked around Trump’s Riverside South project and other job sites, let major contractors with whom he did business understand that he operated two separate brick and masonry companies, one non-union and another union, to be used if necessary. The non-union bricklayers got $125 a day. The rate for union workers, including benefits, was $47.36 per hour. Pezzullo eventually pled guilty in the case.

One of Heifetz’s frequent advisers on labor unions was a Luchese soldier named Arthur Zambardi, who also later pled guilty. “Let Arthur handle it,” Heifetz advised a foreman worried about one union dispute. “I don’t care if he breaks their heads.” Zambardi in turn expressed loathing for unions that enforced the rules. “I do not even bother with those rat motherfuckers,” he was heard telling a contractor about the city’s largest union of laborers, Local 79, which had recently emerged from a federal trusteeship imposed to rid it of mob influence. “You might as well call the FBI and deal with them,” he said.

The unions and everyday workers weren’t the only ones being scammed. Heifetz and other contractors in the Luchese case allegedly used another time-honored underworld tactic, recruiting groups of job-hungry minority construction workers to muscle away competitors, pushy unions, and even government agencies.

In several wiretapped conversations, Heifetz was heard reaching out to the leader of a group in Brownsville, Brooklyn, called Akbar’s Community Service. The organization is one of the so-called “coalitions” reputed to use a mix of old-fashioned civil rights rhetoric and strong-arm intimidation to force payoffs and no-show jobs at construction sites. The leader, Akbar, a/k/a Derrick Ford, has convictions for gun possession and has often been cited by prosecutors for helping mobsters put the squeeze on contractors.

In a July 1998 conversation, Heifetz was heard ordering Akbar to deliver an early- morning busload of men to a public school job site in Queens where he was having a dispute with the city’s School Construction Authority. “I think there’s going to be a problem. So I want you there at seven o’clock,” Heifetz told him. “And I want you to leave five guys around the clock.” Like Heifetz’s non-union employees, the minority security guards were had at bargain prices. Still, Akbar was glad for the assignment. “So you want 10 shifts at 10 dollars an hour, doll. All right, Saul. See you tomorrow,” he told him.

Heifetz was then heard bragging to other contractors that the agency, which was seeking to replace him with another builder, was in for a surprise. “Nobody is going to work there, except the EMS [Emergency Medical Service], the 9-1-1 people,” he said to one contractor. “That’s who’s going to work there. It’s going to be a fucking war out there tomorrow.” To another, he was even more explicit. If the rival builder’s workers didn’t walk away from the job, then “they are fucking idiots because they are going to get their heads bashed in.”

The show of force apparently worked, without overt violence. Investigators spotted Akbar’s men in conversation with Zambardi at the site and the would-be replacement firm never showed up. But the minority group was just a means to an end and Akbar was soon overheard complaining that Heifetz wasn’t providing any additional work. “When you need me, I’m there for you. Afterwards, I don’t get any calls. No anything,” Akbar told the builder.

A few months later, however, one of Heifetz’s foremen told him that some of the coalition workers had union cards and would have to be paid at the proper level. No way, responded the builder, explaining in the brutal language cited above that the Mafia is not an equal opportunity employer.

There was an ethnic calculus for everything among the mob and its contractors, the tapes reveal. “I think . . . for the Polacks you pay $150 a day,” a foreman reminded Heifetz during another job. “For the blacks you pay $160 a day.” “No, no,” answered Heifetz. “I pay them $150 a day.”

Asked about his derogatory language on the tapes, Heifetz said he couldn’t help it. “That’s me. I can’t change that,” he said. “They are construction people,” said his attorney, Watters. “They don’t talk like lawyers sitting at a table.” A lot of what the contractor says on the tapes, insisted Watters, “is meant to be tongue-in-cheek.”

But in fact, it’s not the mob’s crude talk that is most damaging but rather the cynical manipulation of those it encounters. The mob even had its own jargon to describe the different types of workers, the tapes show. In a January 1999 conversation with another contractor, Zambardi advised him that his workforce would break down this way: He would have “18 heathens on the job [and] you would have to take three hooligans.” “Heathens,” police detectives listening in to the conversations explained in a court affidavit, were non-union workers; “hooligans” were union employees.

Workers were easily picked up and discarded. One of Crea’s associates, faced with a job deadline, told him that he would “go get a couple of Mexicans.”

The same demeaning attitudes were also held by a contractor who ultimately became a government cooperator and who is poised to be a star witness against Heifetz or other defendants who go to trial. Sean Richards, 38, literally married the mob when he wed the daughter of one of New Jersey’s most venerable gangsters, John Riggi, the reputed former boss of the DeCavalcante crime family, an assortment of dysfunctional gangsters who provided the basis for TV’s The Sopranos. Richards himself ably fit the mold.

With wife Sara Riggi listed as president, Richards set up a woman-owned construction business to qualify for government set-asides and used mob contacts such as Crea to get jobs. The firm won work on public schools and hospitals and the transit authority. The tapes contain a steady stream of his wild talk, both before and after he put on a government wire. A black man who crossed in front of his car was treated to a storm of curses while Richards spoke on a cell phone with his pal, Luchese soldier Joseph “Big Joey” Datello. “It is a green fucking light, you fag mother fucking nigger. These niggers think that cars won’t hurt them . . . Fucking nigger, cocksuckers. I hate them.”

One of Richards’s biggest jobs was a $5 million contract to help renovate the old Park Central Hotel on Seventh Avenue and West 56th Street, a once glamorous spot where gambler Arnold Rothstein was fatally shot back in 1928. The hotel was in the process of being renovated by developer Bruce Eichner and, according to the charges in the indictment, Richards’s company submitted an inflated bid to win the work and then kicked back part of the price to unnamed individuals. But when Eichner failed to pay Richards what he insisted he was owed, the contractor cursed him as a “fag Iranian cocksucker” and waited for the developer outside his office. “This guy has got to come out, I don’t care if it is three fucking days. I look like a fucking Charles Manson when this motherfucker comes out. . . . I will do whatever it takes to get my fucking money. Anything.”

Richards had claimed to be using union labor at the Park Central job, but instead enlisted a crew of minorities and other workers paid far below union scale. A carpenters’ union business agent named Martin Devereaux allegedly told other union officials that he couldn’t enforce the contract because Richards’s company was “a gangster type.” But Richards later said his protection from the union was really purchased with a $50,000 bribe to Devereaux and his boss, Carpenters District Council president Michael Forde.

Forde and Devereaux have both adamantly denied the charges. “There is no credible evidence that any money went to Mike Forde,” said Forde’s attorney, Dino Lombardi. “It is a very easy thing for a guy like Sean Richards to put a union guy in the soup.” Like Heifetz, the union officials have insisted on having their long-delayed day in court.