I used to think that Fosco's stuff had the ring of truth to it, but the more I read it the more I got the feeling that he is just throwing everything that he can think of but the kitchen sink at DiFronzo and hopes that something - anything, he doesn't care what - will stick.
Guy has too much of an axe to grind to be totally credible.
I am pretty sure he really was an associate though - his dad might have been a made guy? Not sure.