First of all Wiretappers, don’t forget to buy me a cup of coffee on Venmo at ganglandwire. Today we must thank our frequent guest host and mafia researcher screenwriter Camulius “Cam” Robinson. In this episode Cam goes deep into the Chicago Outfit’s influence over the Northwest Indiana organized crime rackets. In the Indian state line city of Chicago Heights, IL over 50% of the population was Italian while Indiana did not have the large Italian population. Despite its rural image Indiana organized crime was a real thing.
Lake County, IN
- Fell under Chicago Heights crew of Chicago Outfit
- Anthony Pinelli: early boss of NWI under Capone after Chicago consolidation, later retired to California and LA Family
- Frank LaPorte boss of Chicago Heights (famous photo with Capone sitting on lawn), boss of whole crew (IL/IN) until 1972
- Al Pilotto 1972-1982 indictment
- Al Tocco/Dominick Palermo 1982-1990
- Indiana capos:
- Gaetano “Tommy” Morgano: deported to Sicily 1963 after a gambling conviction rather than go to prison
- Frank Zizzo (ran operations 1963-1988): owner of Pepper Pot Pizza in Gary and Highland—NOT Santini’s Pepper Pot in Portage or Valparaiso (no lawsuits)
- Bernard “Snooky” Morgano (b. 1936): son of Tommy, indicted in 1990, released in 1996
- Snooky Morgano’s organization:
- Anthony Leone (b. 1939) : nephew of Morgano and lieutenant,;ran street tax and gambling rackets in the area; lived in a “huge house” in Valparaiso; went into Witness Protection after testifying in syndicate trail in NWI in 1989; but left voluntarily in 1991 to return to the area and spend the holidays with his sons; he was active in the Special Olympics; and died March 13, 2019
- Peter “Cadillac Pete” Petros (b 1935): street tax collector for Leone
- Sam “Frog” Glorioso (b 1942): street tax collector and soldier, he was a steel worker
- Sam Nuzzo (Merrillville): 80% of illegal gambling in Lake County
- Efrain “Puerto Rican Frankie” Santos: ran bolita in East Chicago, partner in operation with Ken Eto, controlled Latino crime in the area, Chicago came to appreciate Santos more than Morgano
- James A. “Sonny” Peterson (East Chicago): controls policy rackets in predominantly black neighborhoods, involved in scam with County Commissioner to sell nursing home to County at elevated price
Funny Indiana Organized Crime:
Al Roy Watkins: lottery operator turned federal witness, reported to Anthony Leone
- 1983—Anthony Leone and Al Roy Watkins both laid off as foremen at Gary Works of US Steel, so they started a lottery with &10,000 loan from Bernard “Snooky” Morgano
- $600-$700 per day in the beginning, $3000 later per day, every day, except Christmas—that’s a holy day
- Same numbers as Illinois Lottery Pick-Four, and they drove to Illinois and use that state lottery to “lay-off” number combinations that would break the bank
- 55% of every dollar to costs (15% to mob, 10% to cops, 30% to lottery winnings), 45% to Leone and Watkins
- Leone was said to carry a gun and lived in a “very huge house” in Valparaiso, IN
- Leone sold the lottery for $10,000 to a new lottery group, and gave Watkins nothing, but assured he could go with the sale and continue running it…basically throwing Watkins in. Watkins later said, “He sold me like a slave.
Poor Vincent “Pee Wee” Lozado: gambling operator in Merrillville, IN, caught talking to under-cover Gary police officer
- Paid 10% street tax to Morgano through Leone—also had to pay 15% to Santos, because“all Latins involved in illegal activity paid street tax to Puerto Rican Frankie”
- Leone owed Lozado $10,000, so Lozado left and worked only for Santos
- Christmas 1985, Leone took Lozado’s business back and demanded 10% plus $1,000 a month street tax, plus the 15% he was forced to pay Santos. Lozado couldn’t complain to anyone, because they were all connected to the Outfit, so he told undercover officers he was only making book to continue paying the street tax he owed. In 1990, he was indicted and went to prison for 3 years.
Frank Zizzo pay shake-up—Indiana organized crime leader Anthony Leone starts to lose faith
Frank Zizzo the previous boss of NWI died in 1986. He paid his people well. When he died, his counter-parts in Illinois did not.
- Anthony Leone stated that he was paid $1000 per month for collecting street tax from Snooky Morgano until Zizzo died
- Leone questioned his uncle Morgano about pay going forward, “He said he didn’t know if either one of us was going to have a job.” His pay eventually fell to $300 a month from “people across the state line”
- The Chicago/NWI dynamic is somewhat similar to the New York/North Jersey dynamic
NWI Construction Racket
1989 Al Tocco is imprisoned based on testimony his wife gives. Dominick “Tootsie” Palermo takes over Chicago Heights.
- Tootsie Palermo is capo/boss, Nick “Jumbo” Guzzino is capo of Illinois rackets, Snooky Morgano runs Indiana
- Historically, the crew has dealt in gambling and unions, but they bagan to dabble in construction
- Palermo and Guzzino were heads of the Laborers International Union of North America
- Guzzino collected $2.3 million from contractors in the 1980s for Welfare and Pension Fund, but the office wasn’t set up for cash, so they took him at his word.
- Tootsie Palermo collected cash membership dues, for which he was paid $1000 weekly
Snooky Morgano controlled gambling and construction rackets in NWI through his nephew Anthony Leone
- Major arrests in 1990 of all major gambling and union figures in NWI based on multiple witnesses
- Anthony Leone agreed to testify against his uncle Snooky Morgano and Dominick Tootsie Palermo and Nick Guzzino
- Leone had handled business after Morgano had a heart attack in 1986
- FBI contacted previous owners of pizzeria where Palermo and Guzzino met, owners wife called and notified mobsters
- “Jan called yesterday…the G was checking who owned the joint 1992: Dominick Palermo (74) sentenced to 32 years, 3 months for extorting protection money from bookmakers in NWI, and fined $250,000
- Nick Guzzino (50) sentenced to 39 years, 6 months and fined $185,000
- Bernard Morgano (55) sentenced to 16 years, 3 months, $177,000 fine
- Morgano said of his nephew “He is a snake, he lied on that stand. I do not ask for mercy, I ask for justice.”
- Guilty of using threats of bodily harm and arson to collect thousands in street tax—11 victims testified
There were several tapes discussing extortion “we are going to have to check it out with Chicago first”
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