by Lamothe, Lee
Despite the chronic shortage of investigative resources, the officers made some solid progress. They had gained the trust of several of their regular underworld clients who were connected to the Rizzutos and would socialize with them, discussing mob gossip and criminal plans. One client, Dominico Tozzi, was a 52-year-old jetsetting businessman who was ostensibly involved in an import-export business and as a nightclub owner. He was also a mob associate of the Rizzutos, who rented an office across from the exchange house, one floor above Lagana’s law office, and dabbled in both cocaine conspiracies and high-value money laundering. Tozzi bragged to an undercover officer working at the exchange company about his contacts in law enforcement, both the Montreal city police and the Montreal office of the federal RCMP. His contacts were not as plugged-in as Tozzi might have hoped.
On March 29, 1993, one of the undercover RCMP officers working at the covert currency exchange counter met with Tozzi at a downtown Montreal restaurant. Tozzi, of course, took the man to be an underworld colleague who had worked for almost three years in moving the organization’s drug money through the exchange.
Over lunch, Tozzi, a business associate of Joe Lagana’s, spoke of their mutual interest—the movement of lots of dirty cash. Tozzi was in need of laundering services for about $2 million, he said. As the lunch stretched on and the wine flowed, Tozzi started talking more than he should have, according to police reports filed on the meetings. He said the “big boss” was Italian. The boss was the one who made the major decisions, he said. Going further, he confided that the boss’s name was Vito Rizzuto.
Tozzi had, in fact, met with Vito just the day before, he boasted, and Vito was the one who was calling the shots on the $2 million he was looking to process at the currency exchange. Likely leaning in a little closer and lowering his voice, Tozzi then told the agent that the “big Italian boss” never directly got his hands dirty in such affairs. The boss refused to “touch anything,” Tozzi said. The boss was very well known to police and could not risk being caught by them or else he would surely find himself in prison, Tozzi said. The investigators were thrilled, stoking their hopes that the Tozzi slip and their other efforts in the operation would make those words prophetic. This time, officers were certain, Vito would be nabbed.
The undercover officer later mentioned Tozzi’s name to Lagana. Lagana said that if Tozzi were ever arrested and told police all he knew, half of the people in Montreal might end up in jail. Lagana then warned him to be careful what he said around Tozzi. The officer replied that Tozzi might find himself killed if he was so dangerous.
“I’m surprised it hasn’t already happened,” Lagana replied.
The interactions between the undercover officers and their new criminal customers went beyond such gossip. In 1994, they were approached with an additional business proposition. Could they help “take care” of a cocaine shipment from Colombia into the United States and Canada? The agents readily agreed. This was the chance they had been waiting for, to be able to conclusively connect the masses of cash to illegal drugs. As the plans for moving the drugs unfolded, they revealed the seamless way the Sixth Family worked with both Colombian cocaine cartels and members of the Hells Angels Motorcycle Club.
COAST OF COLOMBIA, AUGUST 17, 1994
An ocean-going freighter steered slowly south toward the warm coastal waters off the Colombian coast, not far from the city of Barranquilla, one of the four major industrial centers of Colombia and among South America’s busiest ports. The ship had been secretly leased by RCMP officers working with agents from U.S. Customs and the Drug Enforcement Administration, and was being passed off as an underworld asset in the control of the supposedly crooked men behind the International Monétaire.
On August 17, 1994, as the ship slowed to a halt offshore, near the mouth of the Magdalena River, its covert police crew was met by Norman Rosenblum, a wealthy and enthusiastic businessman from Vancouver who, despite his expensive tastes for designer clothes and high-end watches, was not above doing some of the heavy lifting himself. When the freighter arrived at the rendezvous point, Rosenblum shot from the Colombian beach and helped push aboard 14 bales of cocaine, weighing in at 558 kilograms. The freighter then headed north, stopping first in Miami, then making its way along Canada’s eastern seaboard and down the St. Lawrence Seaway to Montreal.
Once it arrived at the Port of Montreal, the drugs were supposed to be transshipped to England. In London, two Quebec members of the Hells Angels waited to collect the load for distribution in Europe. But the drugs never made the journey across the Atlantic. Police removed the cocaine from the freighter in Montreal and held it as a key piece of evidence in their four-year-long money-laundering investigation, the needed proof that the cash coming into the Centre International Monétaire was, in fact, drug money.
With the seizure, police could finally start to wrap up their frantic money-laundering operation. Working with federal prosecutors, officers started sorting out who should—and could—be arrested. Police were anxious to place Vito Rizzuto under arrest for what investigators saw as his obvious role in the background of so many of the key money and drugs players. Government lawyers were not so sure.
Debate ensued while the investigation was ending.
MONTREAL, AUGUST 30, 1994
At 6 a.m. on August 30, 1994, police officers who had literally synchronized their watches started moving in on more than 40 suspects in coordinated raids on homes, businesses and financial institutions across Montreal and in other Canadian cities, including Quebec City, Trois-Rivières and Vancouver. About 480 officers from federal, provincial and city police forces participated in the sweep. One of the accused lawyers, Vincenzo Vecchio, was arrested as he dropped his six-year-old son off for his first day of school.
“It was all done very discreetly,” his wife said. “My children didn’t know what was happening. I told them he was just going off somewhere with a client.” The two Hells Angels who were waiting patiently in London for the cocaine to arrive were arrested by British police.
By mid-morning, the RCMP’s Quebec headquarters in Westmount was flush with accused gangsters, drug dealers, illicit money movers and excited police officers. To handle the crowd, the gymnasium was partitioned into 40 temporary holding areas where suspects were questioned and processed separately.
The arrests cut close to the bone for the Sixth Family. Emanuele Ragusa, who was described as “the banker” for the network, was scooped up by police, as was one of the family’s most trusted drug contractors, Sammy Nicolucci. Lagana, Vito’s lawyer and a relative, and two other lawyers in Lagana’s law firm were also arrested. Vincenzo “Jimmy” DiMaulo, a longtime friend of Vito’s, who, a dozen times a year or more, would be included in Vito’s foursome in a round of golf, was among those taken to RCMP headquarters. Rosenblum, who was described as the network’s “transportation manager,” was picked up in Vancouver. Cantieri and Tozzi were also caught in the dragnet.
Nowhere among the downcast throng, however, was Vito Rizzuto.
At the insistence of federal prosecutors who had evaluated the extensive evidence gathered by investigators—including 3,500 recorded conversations and videotaped meetings—Vito could not be charged. Police had to satisfy themselves with naming Vito as an unindicted co-conspirator, offering him bad publicity rather than a judicial fight. He would not be arrested, nor would he face the courts. While search warrants and affidavits filed in the case openly refer to the “Vito Rizzuto group,” his name was glaringly absent from the list of those arrested or wanted for arrest. Vito’s name was also included on the search warrant authorizing officers to enter Joe Lagana’s law office; Vito was one of 26 people and 34 companies whose records could be seized if any were found there. All were alleged to have been involved in the Rizzuto organization’s drugs and dirty money enterprise.
“We know that he is part of the conspiracy but, because of legal principles, we cannot file this evidence against Mr. Rizzuto,” prosecutor Danielle Côté said at the
time. Once again, Vito walked away. Police tried to mask their disappointment.
“We’ve seized their dope and we’ve frozen their homes and bank accounts. We left them 25 cents for a phone call. It’s going to hurt them a lot,” said Sergeant Claude Lessard, a chipper RCMP spokesman, when announcing the sweeping arrests. He should have known better.
Vito and his associates were left with far more than 25 cents.
BERN, SWITZERLAND, AUGUST 31, 1994
There was little diplomatic fanfare when a representative of Canada’s embassy in Switzerland arrived at the Federal Police headquarters in Bern on the morning after the Montreal arrests. He was there on urgent business and in need of their help. Presenting official requests received from the RCMP, the ambassador was seeking “urgent judicial assistance” from Swiss authorities.
The undercover police operation against the Rizzuto organization in Canada had apprehended some of the men, but did little to capture the money. The RCMP was anxious to recover the money it had laundered for the traffickers. The ambassador presented the Swiss Federal Police with the names of those who were charged with moving the drug money through the RCMP’s currency exchange, with a request that their banking activities in Switzerland be examined and accounts frozen. The Swiss quickly focused on Joe Lagana’s role. A number of accounts that had either sent or received transfers from Lagana’s numerous business or personal accounts were blocked from further activity with a notification that, should anyone try to gain access to the funds, police were to be called immediately. Three of those accounts were listed in the name of Luca Giammarella. One was at the Credit Suisse Trust in Lugano.
Wasting no time, after the covert money-laundering sting in Montreal had been revealed, Libertina Rizzuto and Giammarella headed to their banks in Lugano. They arrived one day too late. Police in Switzerland were already sifting through the accounts and banking records, tracking the international movement of huge amounts of money in several foreign currencies through personal and corporate accounts. The Credit Suisse Trust branch had already received the government order of August 31 and immediately informed the Public Minister of the presence of Libertina and Giammarella. This is what led to their arrest.
A curious pattern of account openings and closings was emerging for Swiss investigators, experienced in tracking money; they noted three distinct “phases” in which Rizzuto money was cycled every few years through a fresh set of bank accounts.
“It can be said that the moving from one phase to another was done in order to create difficulties for any future investigations,” the Swiss authorities concluded.
Luca Giammarella can be excused for having to write down the names and addresses of the banks in Lugano in which he nominally held title to huge amounts of cash, for there is little evidence to suggest he had much to do with them between the time he opened them in late May 1988 and the time he apparently came with Libertina Rizzuto to drain them, six years later.
On May 24, 1988, Giammarella visited the Banque Populaire Suisse, a financial institution that holds art exhibitions as part of its cultural contribution to the city, and opened the “MICA” account, the first of what would be three Swiss bank accounts in his name later traced by authorities. That same day he visited the Banca di Roma, a Lugano branch of a Rome-based commercial bank, to open a second, the “ASPARAGINA” account. The next day, he was off to the Credit Suisse to open the third account, the one he was trying to get into in 1994 when arrested. All told, into these three accounts over those two days, he had deposited 4,646,100 Swiss francs, according to Swiss authorities. That was worth about US$3 million at the time.
Giammarella was not alone in Lugano on that visit, and if he was inexperienced in setting up Swiss accounts, there was another Rizzuto associate in the city who had plenty of experience in such matters. According to the registration of a Customs notice at the Chiasso border station on the Italian-Swiss frontier, where the busy rail lines stretching from Lugano to Milan are monitored, Beniamino Zappia also crossed into Switzerland on May 24. Swiss financial records show that Zappia was also conducting banking business in Lugano on the same day Giammarella was opening his accounts. Zappia personally made a withdrawal from an account at the Banca Privata Rothschild in Lugano—account No. 603.154, assigned the code name “SEBUCAN”—in which he shared signing authority with Paolo Renda, Vito’s brother-in-law. The Zappia/Renda “SEBUCAN” account had been bloated, just two months before, by a series of five consecutively numbered high-value checks, each drawn from the same Montreal bank.
That Zappia and Giammarella both found themselves in Lugano at the same time was no more a coincidence than Giammarella and Libertina’s simultaneous visits years later, authorities believe. Zappia was playing a key role in moving the Rizzutos’ riches.
What Swiss police believed Zappia and Giammarella were up to that May was the transferring of funds from the second phase of the Rizzutos’ complicated banking cycle, into the third phase.
The first phase of the money’s run in Switzerland had typically seen members of the Rizzuto family directly opening accounts in their own names with multiple family members having signing authority over them. There were four accounts, for instance, each in a different Lugano bank, opened between October 30, 1980, and August 25, 1981, in the name of Libertina Rizzuto, or jointly in the name of Libertina and Nick. On all four accounts, most of the immediate family had signing authority, granting each of them access to the cash. Two of the accounts granted signing authority to both Nick’s son and daughter—Vito Rizzuto and Maria Renda—as well as their respective spouses, Giovanna Cammalleri and Paolo Renda. Two other accounts dropped Paolo Renda from the list. During this phase, Joe LoPresti also opened a Swiss account, with signing authority granted to LoPresti’s wife, Rosa, and to Libertina Rizzuto. Another account was listed strictly in Beniamino Zappia’s name—the “PRETORIA” account—from which more than US$55,000 was transferred to LoPresti’s “BOUCHERVILLE” account.
This first phase of the money’s run ended when most of these accounts were closed, one by one, in May, June and July of 1985. Only one of the joint Rizzuto accounts, No. O-5722.089, given the code name “MARACAI” at the Société de Banque Suisse, to which all of the immediate family members had authorized access, remained open with a modest balance. It was, in fact, the smallest of the accounts when authorities froze the Cdn$109,000 and US$820 found in it.
By the summer of 1985, the Rizzutos were moving their cash holdings away from accounts listed in their own names, signaling the start of phase two of the money shuffle, according to the Swiss.
These accounts were entrusted to extended family members—and to Beniamino Zappia, whom police found had spent his youth in Cattolica Eraclea, the Rizzuto clan’s hometown in Sicily.
The account listed in one family member’s name was still open at the time of the 1994 investigation and authorities froze the balance of approximately 2 million Swiss francs.
Three other phase-two accounts, each opened at a different Lugano bank, were in the name of Beniamino Zappia. One of them retained Nick Rizzuto as an authorized signing officer; another, Paolo Renda; and on a third, a Giorgio Bissi was listed, the Swiss authorities say. These accounts were kept flush with transfers from the Fédération des Caisses Populaires Desjardins, a financial institution in Montreal that maintains two branches a few blocks apart on either side of the Club Social Consenza, the Rizzutos’ Montreal headquarters. Between December 11, 1986, and March 29, 1988, more than 5,412,000 Swiss francs, US$1,306,715 and Cdn$500,000 flowed from the Montreal Caisses Populaires into these three accounts.
The money’s third phase was launched when Giammarella went in May 1988 to open his accounts, according to the Swiss. Authorities believed that Zappia was secretly arranging things behind the scenes in Switzerland on behalf of the Rizzutos. The Swiss prosecutor’s office noted that the total number of Swiss francs sent to Zappia’s accounts from Montreal was just slightly more than the amount Giammarella deposited when openin
g the three accounts—4,646,100 Swiss francs.
“It is suspected that the funds deposited by Giammarella come from the transfers in Switzerland into the bank accounts of Beniamino Zappia, from [the] Canadian bank,” a Swiss police report says.