Law enforcement officials bristled at the annual turkey giveaways and Christmas dinners he sponsored for the poor, media events that brought the young mob leader positive publicity.

"It's easy to be generous when it's not your own money," said one investigator who has tracked Merlino for years.

An admitted gambler - some friends describe him as a degenerate - and not a particularly astute handicapper of pro sports, Merlino lost literally hundreds of thousands of dollars over the years betting with local bookmakers.

But Merlino, arguably the number-one or number-two man in the local mob, was also a deadbeat.

During Stanfa's racketeering trial in 1995, several major bookmakers from Northeast Philadelphia testified that they lost tens of thousands of dollars taking the "action" of Merlino and the late Michael Ciancaglini, who bet heavily during football season, bookmakers' busiest time of the year.

Merlino and Ciancaglini, they testified, would collect when they won, but would not pay when they lost. Most times, however, they lost.

Two years ago, according to several underworld and law enforcement sources, Merlino began to bet with a bookmaking operation run by Previte, who was conducting the gambling ring as part of an FBI undercover operation.

On one weekend, Merlino lost $212,000.

He never paid. Friends and associates now say that Merlino and several mobsters close to him were out to "scam" or "guzzle" Previte, whom, they say, they never trusted.

"Unfortunately," said one source, "we couldn't pick any winners."

At the time no one was aware that Previte was a cooperating government informant.

Underworld sources who have watched the Natale-Merlino crime family come undone point to Merlino's gambling habits and patterns as a prime reason for the decline.

"Gambling is a business," said George Fresolone, a onetime Newark mobster who became a government informant 10 years ago. "If you play, you gotta pay. It's that simple. If not, nobody makes out."