Case: 1:10-cr-00196 Document #: 85 Filed: 09/19/12 Page 1 of 8 PageID #:335
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION
UNITED STATES OF AMERICA )
) No. 10 CR 196-1
vs. )
) Judge Harry D. Leinenweber
RUDOLPH CARMEN FRATTO )
GOVERNMENT’S SENTENCING MEMORANDUM
The UNITED STATES OF AMERICA, by GARY S. SHAPIRO, Acting United States Attorney for the Northern District of Illinois, submits this memorandum in support of its sentencing recommendation for defendant Rudolph Carmen Fratto (“Fratto). For the reasons set forth below, the government asks the Court to sentence Fratto to a term of imprisonment substantially in excess of the Advisory Guidelines range plus two offense levels.
I. BACKGROUND
On March 11, 2010, defendant Fratto was charged by indictment with mail fraud in violation of Title 18, United States Code, Sections 1341 and 2 (Count One). On October 27, 2011, Fratto entered a plea of guilty pursuant to a plea agreement to Count One of the indictment. Sentencing is set for September 26, 2012, at 9:45 a.m.
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II. APPLICABLE GUIDELINES RANGE
A. PSR’s Calculation of Total Offense Level
The government agrees with the PRS’s calculation of a Total Offense Level of 14.
PSR 5-6 //lines 87, 89.1 That offense level includes a ten level increase for an intended loss amount greater than $120,000 and less than $200,000. PSR 5 //72-74.
B. PSR’s Calculation of Criminal History Category
The government agrees with the PSR’s calculation of total criminal history points of 2 and Criminal History Category II. PSR 6 //104-105.
C. Advisory Guidelines Range
The government agrees with the PSR’s calculation of the advisory guideline range for imprisonment of 18-24 months. PSR 13 //303-304.
III. A SENTENCE ABOVE THE GUIDELINES RANGE IS APPROPRIATE.
A. Section 3553(a) factors
Section 3553(a) requires the Court to impose a sentence that is “sufficient, but not greater than necessary,” to comply with the purposes of sentencing.2 In order to determine
1 Abbreviations in this filing are as follows:
// - Precedes citation to numbered lines on cited page Tr. - Transcript of recorded conversations
2Those purposes are the need for the sentence “(A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense; (B) to afford adequate deterrence to criminal conduct; (C) to protect the public from further crimes of the defendant; and (D) to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment in the most effective manner.” § 3553(a)(2)(A)-(D).
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the “particular” sentence to impose, the Court must consider the familiar statutory factors listed in § 3553(a)(1)-(7). The advisory range set by the Sentencing Guidelines and the Commission’s policy statements are factors to be considered. §3553(a)(4), (a)(5). The Advisory Sentencing Guidelines “should be the starting point and the initial benchmark” in determining the appropriate sentence. See Gall v. United States, 522 U.S. 38, 128 S. Ct. 586, 596 (2007).
Where membership in or association with organized crime is used to further the criminal activity for which a defendant is convicted, a sentence above the Advisory Guidelines sentencing range is appropriate. See United States v. Hanhardt, 361 F.3d 382, 392-93 (7th Cir. 2004) (upward departure equivalent to two Guidelines offense levels imposed); United States v. Zizzo, 120 F.3d 1338, 1361 (7th Cir. 1997) (upward departure equivalent to two Guidelines offense levels imposed); United States v. Damico; 99 F.3d 1431, 1439 (7th Cir. 1996) (upward departure equivalent to two Guidelines offense levels imposed); United States v. Schweihs, 971 F.2d 1302, 1316-17 (7th Cir. 1992) (upward departure equivalent to seven Guidelines offense levels imposed, analogizing the use of organized crime to the discharge of a firearm (a seven-level increase under §2B3.2(b)(3)(A)(i))).
As explained below, a sentence above the advisory range is appropriate in this case because the § 3553(a) factors weigh in favor of such a sentence.
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B. Nature of Offense and History and Characteristics of Defendant – § 3553(a)(1)
During the commission of the offense, Fratto was a “made” member of the Chicago Outfit. Nicholas Calabrese (“Calabrese”) testified under oath in the Family Secrets trial that Fratto became a made member of the Outfit in 1988. United States v. Calabrese, et al., 02 CR 1050 (NDIL 2007), aff’d sub nom. United States v. Schiro, 679 F.3d 521 (7th Cir. 2012), (Family Secrets Transcript at 2709-10 attached as Exhibit A and 2855 // 17-18 attached as Exhibit B). Calabrese’ testimony is highly credible. In 2002, Calabrese began cooperating with the government. United States v. Ambrose, 668 F.3d 943, 948 (7th Cir. 2012). He was a “made” member of the Chicago Outfit. Id. A made member is someone who has gained a heightened role in the Outfit by proving himself based upon his trustworthiness and performance. Id. A person would not even be considered for that status until he had committed a homicide on behalf of the Outfit. Id. Because he was a made member, Calabrese was privy to a great deal of information and access. Id. Calabrese was the most important organized crime witness who ever testified in the Northern District of Illinois. Id. He was a key witness in the Family Secrets prosecution which brought RICO charges against the Outfit and which resulted in the conviction of all five defendants by a jury. Id.; Schiro, 679 F.3d at 524. See also Hanhardt, 361 F.3d at 393 (proper to consider out-of-court statements of informants corroborated by other evidence).
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The Outfit conducts its operations in Chicago through “street crews.” Schiro, 679 F.3d at 525. Calabrese testified that Fratto was a member of the Elmwood Park Crew. Family Secrets Transcript at 2855 // 17-18 attached as Exhibit B). Fratto represented himself to be a “boss” of the Chicago Outfit and a member of the Elmwood Park crew.3
Fratto used his membership in and association with organized crime to further the scheme in the present case. Fratto encouraged Individual A to participate in the bid rigging scheme by telling Individual A that if they made money from the scheme, he, Fratto, would help Individual A with Individual A’s debt to Cleveland organized crime figures. Tr. 7/22/05 at 23-24 //15-23, 25-31. See attached Exhibit D. Fratto assured Individual A that he, Fratto, had influence with the Cleveland organized crime figures to whom Individual A owed money; that he, Fratto, would make sure that the Cleveland organized crime figures knew that Individual A was working with Fratto; and that, as a result, the Cleveland organized crime figures would be patient in demanding Individual A pay them what he owed them.4
3Fratto to Individual A: “I’m the fuckin’ boss of this area around here. No one else.” Tr. 9/1/05 at 19 //25-27. Later, Fratto told Individual A the government wanted to get Fratto because Fratto was part of the Elmwood Park crew. ( “ (UI) get me because I’m a part of (UI) Park and they’re trying to get one of us.”) Tr. 9/1/05 at 26 //6-15. See attached Exhibit C.
4On June 6, 2007, Fratto told Individual A that, “Them guys [Cleveland OC figures] know who I am. ... [Cleveland OC Figure A] and me are equals. [Cleveland OC Figure A] will respect us because we have more authority in Chicago than they have in (UI).” ... “I wanna get it back to ‘em that you’re my friend and I’m doin’ stuff with you [Individual A], so this way they don’t fuckin’ say, ‘Fuck that [Individual A].’ They’ll say, ‘Wait a second, you know, you better watch out, talk to Rudy, ‘cause he [Individual A] really does business with Rudy, ....’” Tr. 6/6/07 at 18 //18-22; 20-21 //30-32, 1-5. See attached Exhibit E.
On July 6, 2007, Fratto agreed with Individual A that Individual A should “call Cleveland”, “leave a message for [Cleveland OC Figure A]”, and tell Cleveland OC Figure A, “Let me
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In short, in return for a share of the profits from the forklift contracts, Fratto was promising to provide protection. That is precisely the corrupting influence of organized crime that must be kept out of legitimate business activity everywhere. That this corrupting influence was interjected into business at McCormick Place, a vital component of the economic viability of the community, makes Fratto’s conduct all the more aggravating.
In affirming enhanced sentences for committing an offense through association with organized crime, one of the factors that the Seventh Circuit has recognized is organized crime’s penchant to use violence to achieve is goals. See Zizzo, 120 F.3d at 1360-61; Schweihs, 971 F.2d at 1312, 316-17. Fratto admitted his knowledge and acceptance of organized crime’s penchant for violence and intimidation and his involvement in acts of violence and intimidation by organized crime.5 Fratto asserted that he would have liked to have used violence against their competitors for the forklift contracts but he did not do so only because he concluded that under the circumstances it would have been unwise to do so.6
[Individual A] know when you’re gonna here. There’s a good friend of mine here [Fratto] that met you at the golf outing. ... He knows everybody here. ... I’m sure you know who he is.” Fratto warned Individual A, “I don’t know how bad the phones are there” and agreed that Individual A use “no names.” Tr. 7/6/07 at 18-19 //21-29, 1-13. See attached Exhibit F.
his
5 Fratto: I remember when I was a young guy ... the thing wound up in my lap. [T]his guy humiliated Tony [Accardo] in a traffic thing. ... [T]he guy [was] cutting grass one day and he got beat up so bad ... I don’t think he could push a lawn mower anymore.
Tr. 2/25/06 at 69-70 //18-39, 1-11. See attached Exhibit G.
6 Fratto: And I would love to, like next week, get that [competitor’s employee] ... and break his legs and put him in the hospital. ... But, that’ll make things even worse... .
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C. Need for the Sentence Imposed – § 3553(a)(2)
Fratto’s offense is serious and the government asks that the sentence imposed provide just punishment and promote respect for the law. § 3553(a)(2)(A). The government asks that Fratto’s sentence address the need for both specific and general deterrence, and be sufficient to protect the public from future criminal conduct by Fratto himself and by others who would emulate his conduct. § 3553(a)(2)(B)-(C). Though Fratto’s own capacity for physical violence may diminish with age, Fratto’s willingness to use his organize crime status, and the justified fear of others of that status, is a continuing threat. Indeed, even Fratto’s willingness to act without explicit Outfit sanction, as may have been the case here, carries with it the danger of violence by other factions of organized crime. See Family Secrets Transcript at 2854-2856 attached as Exhibit B.
These factors all weigh in favor of a sentence in this case substantially in excess of the Advisory Guidelines range plus two offense levels.
Degironemo: [F]irst of all, out of respect, I would expect these two should have backed off ... number one, but they didn’t. Number two, we should’ve sat ‘em down in the beginning ... and said don’t f--k with this show. ... Instead, we wanted to be nice guys, straight guys, be nice to him. ...
Fratto: I think that would’ve ... made it worse.
Tr. 4/8/06 at 20 //10-15; 30-31 //20-34. See attached Exhibit H. 7

Case: 1:10-cr-00196 Document #: 85 Filed: 09/19/12 Page 8 of 8 PageID #:342
IV. CONCLUSION
For all the foregoing reasons, the government asks this Court to sentence defendant Rudolph Carmen Fratto to a term of imprisonment substantially in excess of the Advisory Guidelines range plus two offense levels.
By:
Respectfully submitted,
GARY S. SHAPIRO
Acting United States Attorney
/s/ John F. Podliska
John F. Podliska
Amarjeet S. Bhachu
Assistant United States Attorneys
219 South Dearborn Street, Room 500 Chicago, Illinois 60604
(312) 353-5300

Bump for those interested

This case touched on the connections between the Cleveland mob which clearly still exists and this case proves it and the Chicago mob. As Fratto said “we have more authority here in Chicago than they have in Cleveland” and this was in the late 2000s

Fratto was referring to the late Joe Iaccobaci of Cleveland
Joe Loose and Rudy Fratto were incoohts with a
Workers Comp Scheme as back as early as 2001.
I.think it was tied into the Minute Man Staffing Service
Of Cleveland.
A reporter for the Sun Papers in Cleveland had emailed
Me alot of documents on Joe Loose and Fratto.
If I recall Loose was making a couple trips to a casino
In Minnesota and meeting with Fratto.
Around 2007 there wasnt alot of made guys or even
Associates left in C-town.
Loose...Ciasullo....I think Oliverio....Glen Pauley..
Ray LaMarca...Pappalardo...Jimmy Martino.
Ron Lucarelli ( he was caught up.in that drug bust
With Ciasullo..Walsh and that Jamacian Pendergrast)

Very interesting.....I know in the 90s theyre was a money laundering scheme that was going on between Cleveland,Chicago and the New Jersey Families

With Friends Like These . . .
A '90S GENERATION OF CLEVELAND MOBSTERS HAD AMBITION. THEY WEREN'T MUCH FOR LOYALTY.

by Thomas Francis November 24, 2004
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For mobsters who've helped the feds, coming home for the holidays can be a dangerous proposition.
It was the night before Thanksgiving, 1994, and Paul waded cautiously into the Cleveland night. He was to meet Mike Roman at the Flat Iron, a corner bar on the east bank of the Flats.
A 26-year-old assistant manager, Roman had arrived at the bar to pick up his check, then drink it away. Paul says Roman was "shitfaced" when he arrived around midnight, and Paul ordered him to drink coffee before driving home.

At closing time, they walked out the back door. Paul, who spoke with Scene on condition that his last name not be printed, remembers Roman glowering at a group of men standing around a white car on Center Street. "What the fuck are you looking at?" he asked.
One of the men walked up to Roman. Acting on instinct, Paul took a swing. It staggered the man, but he reached for a gun, squeezing off three shots into Roman's chest. Paul says he tried to grab the gun and it went off -- piercing the wrist of his right arm.

Paul says he hobbled away, blood spurting from his arm. A friend drove him to a hospital.

Roman was dead.

This was a Mafia hit, says Paul -- only the bullets were meant for him.

His old friends suspected that he was a rat. Paul says it isn't true. But suspicion is all it takes to get yourself killed in this line of work.

Ten years later, he sits at the Flat Iron and rolls up his sleeve to show the scar on his right wrist. He remembers the pain, the temptation to pass out and bleed to death on the sidewalk, then the five surgeries it took to repair the damage. What he got out of the deal was a good story.

The transcript from the murder trial, though, tells a different story: Minutes before he was shot, Roman had been honking and cursing at the four men gathered around a car, telling them to quit lingering near the bar.

According to witnesses, Sam Bulgin, a Lake County drug dealer, was in no mood to take orders. He got his .38. The next time Roman came outside, Bulgin was ready.

The transcript makes no mention of the Mafia. Police say it was nothing more than a booze-fueled clash that escalated into gunfire.

Paul's face drops when he hears this. He had wanted to observe the 10th anniversary of the hit that almost took his life. He insists that Bulgin was a hit man, that the shooting was only supposed to look spontaneous.

More likely, Paul is marking the 10th anniversary of the most paranoid time in his life.

There's no doubting Paul's Mafia cred. It's all spelled out in a federal-court file. Few can speak with the same authority on the 1990s version of La Cosa Nostra's Cleveland chapter. In a group whose story has survived through oral tradition, Paul may be the guy who authors the final chapter.
Paul came to the mob by way of Milan -- as in the Milan, Michigan Federal Correctional Institution. There he reunited with two swaggering wise guys, Allie Calabrese and Joe Iacobacci, whom he knew from his Collinwood youth.

During the 1970s, a young Calabrese had run gambling and loan-sharking rackets for the Mafia. Rivals tried to take him out with a car bomb, but Calabrese's neighbor died in the explosion instead. Later, Cleveland underboss-turned-informant Angelo Lonardo testified that Calabrese was involved in the plot to bomb Irish mobster Danny Greene.

Iacobacci went by the nickname "Loose" -- as in "screw loose." He had been trafficking in large quantities of cocaine. Lonardo confirmed to the FBI that Loose was a made man. Paul says Calabrese was too.

It's easy to see what they saw in Paul. He looks like a wise guy -- thick-bodied, muscular to the point of necklessness, Mediterranean skin, and a cocky grin. "Fuck" shows up in nearly every breath.

What most endeared Paul to them, however, was his expertise in an unfamiliar area of crime -- the white-collar variety. Paul was in Milan on securities fraud. In the early 1980s, he had duplicated stock certificates and taken out bank loans by offering the phony stock as collateral. He had also sold stock for a phony product: a self-chilling can. Paul and his collaborators held a press conference at the World Trade Center to announce that they had inked deals with PepsiCo and Anheuser-Busch. Any sucker who bought the stock saw his investment vanish.

Paul impressed upon Loose and Calabrese that white-collar crime paid better than drugs -- and brought only a fraction of the penalties. "It's a dirty business," Paul says of drugs. "And the kind of time they give out is fucking astronomical. I can do a million dollars in fraud and get three to four years. But if you do a million dollars in coke, you're never going to see daylight."

A stockbroker in New York, Paul knew how to create shell companies and move money offshore. "These guys saw my paperwork when I was at Milan," he says. "They fucking loved me!"

They plotted to make their fortune in a racket called the "California swing." Paul would open bank accounts in New Jersey, then deposit bad checks with California routing numbers. At that time, it took 10 days for an East Coast bank to learn that the check was bogus. "In the meantime," says Paul with a satisfied grin, "I'm wiring $4 to $5 million out of the country to an offshore account."

The money would move from islands like the Netherlands Antilles and Curaçao to accounts in Geneva, then be routed through Chicago banks -- with the consent of the Chicago Mafia, which extracted its own toll.

The neatly laundered loot would be the building block for the new Cleveland Mafia, they all agreed. Loose, a favorite of former boss Jack "White" Licavoli, would be the head of the family. Calabrese would be his captain. "We had a pretty good crew set up," says Paul. "It could have been something."
Every start-up has its complications. While he was still in prison, Paul says, he ran into a man from a Newark, New Jersey crew that operated vending companies and trafficked in drugs. "He says, 'Hey, asshole, I know you,'" Paul recalls.

Several years earlier, Paul had screwed the man's crew. "We sold him a vending company that didn't exist," he laughs. "Took his guys for about 150 G's."

Calabrese intervened on Paul's behalf, convincing the Jersey mobster that instead of putting Paul in the ground, he ought to put him on the payroll. As Paul's California swing turned profitable, the Jersey crew could get a fat cut.

Heading the Newark faction was Mike Taccetta, made famous as the model for fictional mobster Tony Soprano. Taccetta signed off on the deal. Paul had extra mouths to feed, but at least he was alive.

He left prison in 1991. From the smile on his face as he reminisces, it's apparent that these were his glory days. Besides the California swing, he was fleecing airlines with a luggage scam.

At that time, you didn't need to show an ID to fly. So Paul could book himself on four flights, using a different name for each. He'd check carry-on bags. Upon arriving, he'd pick up the bag and rip off the tags, then report lost luggage containing about $2,000 in valuables. After a month of fruitless searching, the airline would send him a check for $1,250, the maximum rate.

It was so easy, everyone in Paul's crew did it. "We had guys sitting around, filling out forms all day," he laughs. Paul claims they made thousands a week, multiplying their profit every time they added a soldier. Once, he took a pack of 50 friends on a Florida golfing trip. All claimed to lose their luggage, thus vacationing at a profit.

Meanwhile, the California swing was bringing in so much money, Paul had to go to the Caribbean to cash the checks -- he was worried about alerting suspicion in the States. "I was basically a money machine for the fucking mob," he says. He wore $2,500 suits and $800 shoes, and drove a BMW convertible.

As head of the family, Loose was entitled to a cut of everything. He was supposed to send a portion to New Jersey to pay off Paul's debt. But Calabrese told Paul that Loose was keeping the money for himself and telling the New Jersey crew that Paul wasn't earning.

Paul was furious, but he could do nothing. Loose called the shots.

The FBI was watching with keen interest. Agents decided Paul was ripe for the picking. In July 1992, he was arrested for a parole violation -- consorting with known felons. The feds knew about the California swing. If he wanted to be saved from prison, he'd have to wear a wire.

As an extra inducement, Paul says, agents played a tape of Loose musing over the best method to kill Paul. This, says Paul, combined with the FBI investigation, was enough to make him bolt for Miami.

When the California-swing arrests came down, Paul was listed only as an unindicted co-conspirator. "They didn't have anything on me," he says.

Court files say otherwise. The indictment notes that Paul agreed to wear a wire and that he hung around Cleveland long enough to tape roughly 200 meetings with his partners between the time of his arrest and the spring of 1993. [Paul says that he gave agents permission to bug his car, but never wore a wire.]

Paul was also a groomsman at Calabrese's wedding. He admired the older man's toughness, his style. This was "a gangster's gangster," Paul still says today. But his fawning respect also made Paul perfect for his role; Calabrese would never suspect him.

"Mr. Calabrese was clearly commanding a position of authority over him," FBI Agent David Drab testified at the trial. "He realized, in my opinion, that this cooperating witness [Paul] deified him in a sense, that he looked up to him and wanted to be part of the organization."

Paul taped Calabrese boasting about being "the only guy left" who was capable of forming a new Mafia. He recorded Calabrese's resentment of Iacobacci, who liked the money and prestige that came with mob work, but not the physical danger. "I'm the real, original tough motherfucker around here," Calabrese declared on one tape.

Once, at the Feast of the Assumption, Calabrese wanted to eat dinner at Nido Italia in Little Italy. He sat down at a table reserved by a man who had come with his family. When the man objected, Calabrese dragged him outside. He told Paul he "beat the fucker's head in." When the man's daughter kicked Calabrese in the groin, he slugged her too.

Stories like these didn't help his case. Calabrese was sentenced to three and a half years. Iacobacci got two and a half.

Meanwhile, Paul was in Miami, going to bed at night with a pistol strapped to his ankle.

The subsequent decade has only added more mystery -- and more death. In 1998, a jury convicted Sam Bulgin of killing Roman. Bulgin claims that he wasn't the shooter, that he was set up by a friend who ratted him out in exchange for a reduced sentence on his own drug-trafficking charges.

A year earlier, Bulgin's brother, Peter, was found shot to death in his East Cleveland home. Police never knew whether it was self-inflicted, but Paul believes it was payback for Roman's slaying. "He got whacked," Paul shrugs. He says he knows who did it, but he isn't telling. He only insists he wasn't the one.

In 1999, while doing time at a federal prison in Georgia, Calabrese was clubbed with a metal pipe. He slipped into a coma and died. The attacker was caught, but no one seems to know his identity -- only that he happened to be from Cleveland. Paul thinks Loose arranged the hit.

Loose himself has kept a low profile. There are rumors that he became an informant. Some say he's gone straight. But nobody seems to peddle the theory that he'll make another run at establishing La Cosa Nostra in Cleveland.

Paul claims to be enjoying straight living. He left Cleveland, though he won't say where his permanent address is. He regrets getting into the fast life. Friends from college stayed on Wall Street, earning Fifth Avenue condos.

He has no regrets about cooperating with the feds in taking down the Cleveland Mafia. "There's a difference between being a rat and self-preservation," says Paul. "My ass was against the wall. What was I going to do? Get clipped?"

Upped

when did we start "upping" old posts, this isn't a classified add on Craigslist. If there was interested it would get upp'd by a comment

Because there isn’t a lot to talk about right now and Chicago is interesting w the divergent opinions and how the outfit transitioned to the modern way of doing business much earlier than the NY families did