Peter Scarcella was also one of the last people to see Paul Volpe alive before he whacked back in 1983.

By Adrian Humphreys, National Post

A controversial $2-million payment by gangsters to a Toronto mother paralyzed in their botched mob hit bought them silence from police and prosecutors and could soon help them get earlier parole, prison lawyers complain.

A recent internal memorandum says the Correctional Service of Canada cannot get current information on Peter Scarcella, imprisoned in the 2004 gangland plot that went horribly awry when gunmen fired into a crowded restaurant, missing their target but hitting bystander Louise Russo.

“[A prison officer] has made substantial efforts to obtain updated information from the police but, unfortunately, he has hit a roadblock as none of his contacts will go on record about Scarcella,” says the four-page memo written this February by a government lawyer in Ottawa.

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“It appears that this stems from the fact that Scarcella and his associates paid approximately $2-million to an innocent bystander who was shot during the attempted murder and, in exchange, the Crown agreed not to include any references to organized crime in the plea agreement.

“As a result, and it would appear at the request of the Crown, the police are not talking.”

The memo comes as Scarcella and Mark Peretz, a co-conspirator in the gangland plot, seek parole.

Prior to their appearances before the National Parole Board, both Scarcella and Peretz are trying to remove an organized crime designation from their prison records.

If successful, they would have an easier time moving to lower security accommodations and parole applications would have a greater chance of success.

The carelessness of the April 21, 2004, shooting shocked the city.

Mrs. Russo, a mother of three, pictured, ran into California Sandwiches in north Toronto to buy a veal sandwich as a reward for a daughter becoming an Air Cadet earlier that evening.

Also in the restaurant was a notorious Sicilian Mafia figure living illegally in Canada. Rivals drove through the parking lot in a stolen van and opened fire. A bullet severed Mrs. Russo’s spine.

“Instantly I lost control of my body,” she said of the attack in court. “Feeling was gone. Gone forever.” She remains a paraplegic.

Scarcella was convicted of conspiracy to commit murder; Peretz of nine counts of attempted-murder. Both men pleaded guilty in 2006 and received 11-year prison terms, reduced to nine because of time served.

As part of their plea bargain, they agreed to an unusual $2-million restitution order paid to Mrs. Russo.

Two other conspirators — Antonio Borrelli, who fired the bullet that hit Mrs. Russo, and Paris Christoforou, a member of Hells Angels Motorcycle Club — have not yet applied for parole.

“Although the conspiracies carry the hallmarks of organized crime, Scarcella was not convicted of a criminal organization offence and the agreed statement of fact submitted by the defence and the Crown makes no reference to organized crime,” the legal memo says.

Brendan Crawley, spokesman for the Ministry of the Attorney General, said he could not discuss the negotiations behind the plea agreement.

“The agreed statement of facts filed at the sentencing proceedings is a matter of public record but resolution discussions are confidential,” he said on Wednesday. “The restitution orders were an important part of the sentence in this case. The sentencing judge found that the sentences imposed were appropriate.

“To the best of our knowledge, CSC [Correctional Service of Canada] has not contacted the Crown about this case. In all criminal cases resulting in a conviction, the Crown has an on-going working relationship with CSC,” he said.

John L. Hill, Scarcella’s lawyer, could not be reached for comment.

For its designation, the prison relied, in part, on information from York Regional Police provided in 2006 that Scarcella was “a high-level Sicilian mobster connected to the Rizzuto family in Montreal,” according to documents filed in court.

Scarcella first complained to his warden of being labelled a mobster in March 2007. Three times he protested in writing and three times officials refused to change it.

He then took his fight to the Federal Court of Canada.

“I adamantly deny that I have ever participated in, supported, sympathized or associated in organized crime,” Scarcella says in a sworn statement filed in court.

“It appears that the allegation of membership in or affiliation with a criminal organization is ongoing and may effect my liberty interest when I attempt to lower my security or when I apply for conditional release,” Scarcella says.

The internal legal memo outlines prison officials’ attempts to settle his case informally.

“We have been successful in doing this in the past,” the memo says. “Unfortunately, Scarcella refused to abandon the case.”

Scarcella, in fact, won a judicial review in November 2008, with a judge ordering CSC to re-evaluate and to pay him $3,500 in costs. The legal memo outlines the need for prison officials to use up-to-date information in its decision and officials sought fresh particulars on Scarcella, leading to the allegations of a roadblock.

Last month, CSC still refused to change his designation prompting a new court challenge by Scarcella, during which the legal memo was revealed despite government objections.

Prison officials questioned how Scarcella obtained the memo, suggesting a security breach.

“It was specifically handed to me. I deny any wrongdoing in its procurement,” Scarcella said in an affidavit.

On Wednesday, Chief Armand LaBarge of York police said he is not aware of recent requests for information from prison officials about Scarcella and encouraged them to contact him directly if they have questions.

If asked, he would not deny Scarcella’s links to organized crime, his spokeswoman said.

Currently imprisoned in Bath prison, Scarcella’s new appeal is still before the court.

At the time of sentencing, the $2-million payment was controversial but Justice David Watt of Ontario Superior Court praised the deal.

“Restitution is not some ‘get out of jail early’ card to be played to take a sentence out of a range that would otherwise be appropriate. And it will not do so here,”

Justice Watt said when imposing his sentence.

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