The Coffey Files

by Coffey, Joseph; Schmetterer, Jerry;

  William Aronwald, an assistant to the head of the strike force office, was assigned to coordinate the investigation with Vitrano and Coffey. For the time being, at least, neither he nor his bosses shared Coffey’s interest in the possible involvement of the Vatican in an international swindle. Joe began to worry that the Vatican scam would be lost in the shuffle. He was afraid that the break they were handed when the Vatican was mentioned in that hotel room would not be pursued, and he decided to make sure the possibility of a Vatican investigation was discussed at every strategy meeting of the strike force. He began driving even his friends in the DA’s office nuts with talk of the Vatican.

  At Hogan’s insistence Coffey was forced to take a few days off to spend with Pat and the kids. Within a week, however, he was back at work in the basement room where the wiretap on Jimmy’s Lounge was still being operated.

  Now much more of what Vincent Rizzo was talking about to his mob connections was understandable. The inclusion of the Justice Department in the investigation added a national scope that even Frank Hogan could not have initiated.

  Using names and places from the Munich tapes, FBI agents were being dispatched all over the country. An FBI man named Dick Tamarro was assigned to work full-time with Coffey.

  Rizzo’s operations continued to amaze the New York cops assigned to tail him and listen in on his private conversations. He was constantly on the phone in Jimmy’s Lounge calling upstate New York to order a shipment of counterfeit money, dispatching a hit man to California to collect a $25,000 debt, keeping his drug business going, and trying to figure a way to get that $350,000 still owed from the stolen securities deal. Ense and Barg continued to fend off Rizzo’s threats.

  Meanwhile Coffey’s own level of frustration was rising as all the investigating activity around him seemed to bypass any further move on the Vatican. Even Hogan, who was so happy about being able to pass on the information from the Munich tapes that he never even asked about the gunrunning scheme, did not seem anxious to pursue the lead. Privately with Coffey he talked about the possibilities of the Vatican involvement in the counterfeit securities scam, but Joe worried that his mentor, like the feds, would be happy nailing the securities swindle ring and closing the books on Rizzo, Ense, Barg, and the others.

  A few weeks after he returned from Munich, Joe learned he had passed the NYPD sergeant’s test. Police officers in New York have several career paths to choose from if they seek advancement in salary and responsibility. They can aim for the Detective Division, where promotion is based on achievement, but detective first grade is as high as they can go. That rank, while probably the most prestigious detective position in the world, does not pay as much as it is possible to earn by going up the civil service ranks of sergeant, lieutenant, and captain. Ranks above captain are appointed by the police commissioner.

  But a detective runs a risk by taking the test for sergeant. If he passes, he must return to uniform patrol for at least six months and then hope for a rare opening for a detective sergeant to get back into the Detective Division.

  Coffey wanted to take the chance. He needed the additional rank because he yearned for the authority to act more on his own instincts and hunches. He wanted to be able to command a detective squad, a position many in law enforcement believed to be the best job in the New York Police Department.

  So Joe had mixed emotions about passing the test. He wanted the promotion, but he feared being transferred to uniform before the Vatican Connection was nailed.

  For two months the FBI and New York police continued to run down leads produced by the Munich tapes and the subsequent surveillance of Rizzo and his now growing list of worldwide contacts. Coffey continued to be nagged by the realization that the Justice Department team was not interested in pursuing the Vatican lead. He continued to bother Hogan about it.

  Alone in Hogan’s office one evening, the district attorney counseled Joe not to worry so much. “Joe, let’s take one thing at a time. The strike force is hot on the stolen securities case right now, and I think it is best not to distract them. I’m certain we’ll get our shot at Rome,” Hogan said.

  In late April the wiretap in Jimmy’s Lounge picked up a call from an Englishman named Tony Grant who said he was in New York and wanted to meet with Rizzo. Coffey’s near photographic memory immediately clicked on. During the hours of recording in Munich the name Tony was often mentioned. He was called “The Englishman” and “The Tailor,” but a last name was never used.

  Coffey called a contact at Interpol and ran the name Tony Grant by him. The contact did not have to check his files. He told Coffey that Tony Grant was a well-known European swindler and forger with a record dating back to the 1930s. He often posed as a high-class tailor and dressed the part. He was most recently wanted in connection with swindling an elderly couple out of their life savings, which had been invested in precious jewels. As part of that scheme he used $20,000 in counterfeit U.S. currency.

  Coffey was elated by the information. He knew the Tony on the tapes had to be this Tony Grant who was now in New York. Things were beginning to happen.

  For three days, Coffey and Tamarro followed Grant around New York. The Englishman proved to be the pro his dossier described. He changed hotels every day and he never went directly to a meeting. It was a strain on the resources of both Hogan’s office and the New York FBI to keep a tail on the slippery Grant, but it paid off when they overheard him make arrangements with Rizzo to fly together to Miami to set up a cocaine deal.

  Grant would introduce Rizzo to a South American connection who would accept $60,000 in counterfeit money for a small supply of cocaine to get the relationship going. All parties hoped it would lead to a big-time drug network between the Genovese gang in Little Italy and Colombian dealers. It was agreed to let the deal go through in order to keep building a case against Rizzo. It was hoped that Grant could eventually lead the Justice Department and also the Secret Service (now involved because of the mention of counterfeit money) to the bigger stolen securities case.

  Back in New York, Grant continued to do business with Rizzo’s gang. On Mother’s Day, 1972, he left for Argentina to continue to establish the new drug network. A Spanish-speaking detective from Frank Hogan’s office and Coffey’s regular partner, Larry Mullins, were on the same plane.

  By now Rizzo’s phone calls to Europe were showing his frustration with not being able to collect his money from Barg and Ense. But the two Germans continued to stall. On May 23 Rizzo decided he had to return to Munich. He took along a strong-arm man named Marty DeLorenzo. Coffey and Detective Mario Trapani were on the flight following Rizzo’s. The Munich police were alerted to shadow the two thugs once they landed.

  That same evening Rizzo met with Barg and Ense in Barg’s home outside of Munich. There were no wiretaps installed, but it was later learned that Rizzo told them that DeLorenzo was the man to whom the $350,000 was owed, and he was in Munich to collect it in cash or blood. Rizzo said even he was afraid of DeLorenzo and that this was the end of the line. The money must be deposited the next day in the bank account set up for that purpose. Incredibly, facing the wrath of a Mafia enforcer, Barg and Ense continued to do business their way. Instead of money they convinced DeLorenzo to accept part of a phony Vermont vacation home deal as payment. DeLorenzo accepted.

  Joe, convinced he would learn nothing more about the Vatican connection on that trip, decided he might be more useful back in New York on Tony Grant’s trail. He returned to New York alone. Trapani would later report that Rizzo spent the rest of the week in Munich having an affair with a woman who worked in Alfred Barg’s office.

  The day Joe arrived back in New York he learned Tony Grant and a Genovese button man named Freddy Mayo, who usually ran the phony travel agency that was part of Rizzo’s illegal empire, would be driving a shipment of cocaine into the city. It was decided to arrest them as soon as they hit city limits. Still suffering from jet lag, Joe and the others put a plan into place. Within eight hours Tony Grant
was behind bars in the Tombs, the infamous city jail attached to the Manhattan Criminal Court building that in the past was the last stop for condemned criminals.

  Freddy Mayo was also locked up. And punk that he was, he soon began spilling his guts about his mob relations. For a break on his sentence he was willing to help nail Rizzo for drug dealing, extortion, and other crimes he knew he had taken part in.

  “What about Rome?” Coffey asked the sweating punk, not letting a chance to chase his Vatican hunch go by. “Did Rizzo ever mention Rome, or the Vatican?”

  Joe Coffey had grilled enough low-life criminals to know that the vacant look in Freddy Mayo’s eyes was his natural stare of noncomprehension. He knew nothing of any major deals Rizzo was involved in.

  Tony Grant would not talk. He had been down this road before, and he expected Rizzo to get him a good lawyer and take care of his needs behind bars. For one week, then two, he refused to discuss the case with Coffey, Mullins, or Tamarro. Then Mullins got a call.

  “Grant wants to talk to us,” he shouted across the DA squad room to Coffey. “He’s pissed at Rizzo for not sending him any cigarettes at the Tombs. He wants to help us nail him.”

  Both detectives rushed through the connecting hallway from the court building where their office was to Grant’s cell block.

  Grant was pacing around his cell. He was furious with Rizzo. The mafioso was ignoring his requests for cigarettes made through departing inmates. Grant was a chain-smoker and was suffering. Coffey, since he was also a heavy smoker, sympathized with the Englishman and knew his anger was genuine.

  “You want Vinnie Rizzo. I’ll give you Vinnie Rizzo,” was the con man’s greeting to Coffey and Mullins.

  “Before we could sit down he began his spiel. We would have preferred to get it on tape, but we didn’t want to interrupt him so we let him talk,” Coffey remembers.

  “He told us about the drug deal, how it got set up, who was behind it, and where the counterfeit money came from.

  “Then he told us about the swindle that almost brought down Panama. Now he was getting into an area that interested me because I knew Barg and Ense had mentioned that in Munich. Then, and I’ll never forget this moment, he said, ‘And you must know about that deal in the Vatican. I’ll tell you what Rizzo and Jacobs and that Austrian, Ledl, were trying to do.’

  “All Grant wanted in return was a steady supply of cigarettes. He did not ask for a break on his sentence or for reduced charges. He was singing in order to get back at Rizzo for not doing the right thing. I wanted to kiss the old swindler,” says Coffey.

  Grant finally explained what the Vatican wanted with counterfeit securities. It was known, he explained, that the Vatican Bank was overextended and that certain officials of the bank sought help from bankers and investors with less than reputable backgrounds to help the bank get back on track.

  Grant smoked and talked on and on. He was very willing to nail Rizzo. He was a crook from the old school. Once he agreed to tell Coffey what he knew, he kept his end of the bargain.

  He implicated, Rizzo, Ense, Barg, Ricky Jacobs, and a host of other swindlers, con men, forgers, burglars, gigolos, and strong-arm types from all corners of the globe in schemes that ranged from ripping off wealthy retirees to flooding banks with counterfeit securities and creating vast resort developments with loans based on collateral of stolen and counterfeit securities.

  “As for the Vatican,” Grant said, “the word was that they were after about $900 million of counterfeit American corporate bonds. Everyone wanted a piece of that action. The Austrian, Ledl, made the deal. You’ll have to get to him.”

  By the time Grant finished singing, Coffey and the Justice Department strike force team had plenty to nail Rizzo, Jacobs, Barg, and Ense on, as well as a bunch of less important players, including the son of a former British defense minister.

  In addition to the Coca-Cola of Los Angeles stock, the strike force could now connect Rizzo to stealing and counterfeiting the stocks of such companies as IBM, Norton Simon, Chrysler, AT&T, and General Electric. Rizzo had a portfolio that rivaled those of the greatest Wall Street investors. And he could always steal or forge more, when needed, to be used as collateral in a crooked deal.

  Eventually charges against Rizzo would show that more than $18 million in blue-chip securities that had been stolen from the U.S. Postal Service, from messengers, and from people’s homes had passed through his hands. The amount of counterfeit stocks and bonds was at least that much and probably very much more.

  “The feds were very happy. They did not need to, and they did not want to, open the Vatican can of worms. I was arguing to continue the investigation, but I was a low-ranking member of that team even though I was the one who first brought the case to the Justice Department,” Coffey remembers.

  Coffey knew that eventually the Austrian, Dr. Ledl, would become a major figure in the case, but for the time being he was not anxious to return to Europe to track him down. During Joe’s second trip to Munich, Pat had suffered a miscarriage. Joe did not learn about it until he returned home, and he was bothered by the fact that he was not there for his family when they needed him. He decided not to pursue Ledl unless he had a near 100 percent chance of getting something out of him regarding the Vatican.

  As summer approached, the strike force began preparing their grand jury presentation against Rizzo. In August, Coffey’s Interpol contact reported that a Dr. Leopold Ledl was under arrest in Vienna on a fraud charge and would certainly get a prison term.

  This was great news. If Ledl was imprisoned, he might be willing to talk about his connection in the Vatican in return for a deal not to prosecute him in the United States as part of the Rizzo ring.

  Coffey began agitating for the chance to go after Ledl in Austria. He knew he was running out of time to nail the Vatican link. Word around the department was that the recently promoted sergeants would be sent to their new assignments in early 1973. Joe was sure that he would never get to Ledl once that happened, and he knew that no one else would try. He was losing sleep over the possibility that whoever violated the trust of Vatican office would get away with it.

  Finally in mid-November he got the okay to travel to Vienna with Dick Tamarro to see what they could get out of Ledl. They were authorized to offer a deal of immunity to any charges he might face in the U.S.

  During the last week of November, while their families were celebrating Thanksgiving, Detective Joe Coffey and Special Agent Dick Tamarro sat in the dank cellar interview room of a 150-year-old prison in Vienna. Across from them was Leopold Ledl, an international swindler accustomed to sharing the high society life of his victims. His stay in the Vienna prison had convinced him that he had to avoid extradition to America at any cost. He would do whatever was necessary to avoid this, even putting his life at risk by implicating some of the most important people in Rome in a counterfeit stock deal designed to shore up the weakened finances of the Vatican Bank, and even if one of those people was an archbishop in the Vatican.

  The deal was made and Ledl talked.

  “Ledl finally brought all the pieces together. He told us he had been approached by Cardinal Eugene Tisserant, dean of the Vatican’s College of Cardinals, to buy $950 million in counterfeit U.S. corporate bonds. Ledl passed on the request to Rizzo,” Coffey notes.

  Ledl said that the deal had the total backing of Archbishop Paul Marcinkus, president of the Institute for Religious Works, known as the Vatican Bank.

  Marcinkus’s goal, Ledl told Coffey and Tamarro, was to use the counterfeits as collateral for loans. At first, Ledl said, he never spoke to Marcinkus directly—the cleric used emissaries and cover—but later he did have direct contact with the archbishop and eventually delivered $14.5 million in forged blue-chip securities to him. Ledl believed at least half of that amount was deposited in the Vatican Bank and a substantial amount was placed in the Bank of Italy and Banco Ambrosiano of Milan, Italy’s largest private bank, which was headed by Roberto Calvi.


  Rizzo, Ledl said, at first did not believe the Vatican could be involved in such a scheme and had been reluctant to put in an order for such a large amount of phony paper to be printed by the mob forgers. Ledl said he eventually showed Rizzo two typed requests, on Vatican letterhead, as proof of the Vatican contact.

  Coffey and Tamarro left the interview stunned. All along they believed there was a Vatican connection, but neither man imagined it could be on such a high level.

  “We walked around in a daze the rest of that day. We couldn’t focus our attention on anything except what Ledl had said. We even unknowingly walked into a restaurant known as the most romantic in Vienna. When it dawned on us that all the people around us were young lovers, we looked at each other and cracked up. What we two very large cops must have looked like to the others in the restaurant we can only imagine. We hadn’t even noticed the violinists playing behind us. But the incident broke the tension. Then we were ready to report back to New York.

  “Our first order of business back in New York was to find out all we could about Marcinkus, who seemed to be the keystone of the whole operation,” Coffey recalls. “What we discovered knocked our socks off.”

  Marcinkus was an American from Cicero, Illinois, affectionately known as “Il Gorilla” because of his burly, six four, 240-pound body. In 1972 he was one of the most powerful men in the Vatican, presiding over the Vatican Bank and serving as the Pope’s personal bodyguard and mayor of Vatican City. He was a popular figure on Rome’s golf courses and a frequent guest at high society parties and charity events.

  Yet despite the public attention, an air of mystery surrounded the man because of his almost total control over the finances of the bank. His secrecy regarding those dealings earned him the nickname “the Gnome of Rome,” from Zurich bankers.