Reputed top Chicago mob boss James "Jimmy the Man" Marcello was not simply controlling his criminal empire while he was more than 200 miles away in a federal prison in Milan, Mich.
He was expanding it, the feds believe.
And Marcello, in prison for overseeing an illegal gambling racket among other crimes, was eagerly anticipating the possibility that Illinois would legalize video poker gambling in bars and restaurants -- something that never wound up happening.
The scene was the Milan prison visiting room on May 15, 2003.
The feds were secretly tape recording Marcello's conversation.
And paying a visit was Marcello's little brother, Michael "Mickey" Marcello, the alleged caretaker of the family criminal enterprise, while Jimmy Marcello was in prison.
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One machine makes $100,000 profit
BY STEVE WARMBIR Staff Reporter
Call them crack for gamblers. Illegal video gambling machines -- whether you play poker, slots or bingo on them -- rank as one of the top moneymakers for the Outfit in the Chicago area. The machines themselves aren't illegal in Illinois. But bar and club owners break the law when they pay out on them. One machine can churn out $100,000 in profit a year, noted Cicero Police Cmdr. George Wick, a leading expert on the devices. The mob and the bar owner typically split the profit from the machines every week. "They're more prominent than ever," Wick said. Usually, the devices take $1, $5 or $10 bills, and give each a player a number of credits per dollar. When players cash out, the credits return to zero on the machine. Some machines take $20, $50 or even $100 bills. Others accept a plastic card -- similar to a phone card -- that players can put money on. Generally, the most expensive part of the machine is the bill changer -- the device that reads the bill as the player slips it into the machine. Those can cost $500 and up and are aimed at preventing counterfeit bills from being passed. No matter the game, dip switches can be adjusted inside each machine to adjust how often the machine pays out. At first, the machine may keep only 30 percent of the money. Soon, though, after the gamblers are hooked, the machines are keeping 70 percent of the money or more. The owners of the bars or clubs have access to one area inside the machines -- the money. Usually, the bills fall into a a bucket inside the machine. A collector from the mob stops by once a week to split up the profits. Only that collector has access to a second, secured area inside the machine where there are two counters -- one showing how much money was spent by gamblers, the other showing how much was paid out. The difference is the profit.
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The Marcello family business included a large-scale video gambling business, the feds believe.
Jimmy Marcello had one reaction to the proposed legalization of video gambling:
Ka-ching!
Jimmy Marcello, the older brother, considered sharp and brutal, was correcting the younger brother, Mickey Marcello, considered less intelligent, over who would benefit if the state legalized video gaming.
Mickey Marcello believed other video poker companies might make out well.
But Jimmy Marcello straightened him out on who would be first in line, the feds say.
"First us," Jimmy Marcello emphasized. "Then them."
Unsealed court filing
The inside look at how an alleged crime boss was operating even while in prison is contained in a court document recently unsealed and obtained by the Chicago Sun-Times. Federal prosecutors filed the court document in late 2003 to receive permission to raid Mickey Marcello's business, M & M Amusement, in Cicero, just after Jimmy Marcello got out of prison.
The feds believe Mickey Marcello oversaw the collection of money from more than 40 bars throughout the suburbs from the Cicero location. Video gambling is the mob's lifeblood, pumping millions of dollars every year into the Outfit's coffers.
The investigation of the Marcellos is part of a racketeering case tied to a larger probe that could solve up to 18 mob hits, sources said. A key player in that is a made member of the mob, Nick Calabrese, who is telling the feds all he knows about various mob hits.
In the Marcello case, federal agents tapped Mickey Marcello's cell phone from November 2002 to at least October 2003 and surveilled Mickey Marcello and the men who allegedly worked for him while they collected cash from video gambling machines at bars and restaurants. The machines aren't against the law, but many bar owners offer illegal cash payouts to attract customers.
The mob and the bar often split the profits. One machine alone can generate $100,000 in profits a year.
The illegal video gambling continues to thrive despite recent crackdowns by the feds and local police.
The affidavit notes that "some of Chicago's south suburbs, such as Crestwood and Palos, have become very strong areas" for illegal video poker. The affidavit didn't specify which Palos community.
The crackdowns didn't seem to frighten the Marcellos.
While Jimmy Marcello was in prison in 2001 serving out his 12-1/2 year sentence for racketeering, extortion and illegal gambling, Mickey Marcello, a Schaumburg resident in his mid-50s, made a move on behalf of his brother to take over the video poker business in a number of suburbs, including Cicero and Berwyn, according to the affidavit.
Suburban mob meeting
Men considered by the FBI to be made members of the Chicago mob, including John Matassa and Rudy Fratto, met with Mickey Marcello on the plan and approved the move, the affidavit alleges.
The gathering was held at D Graphics, an Elk Grove Village printing company that authorities say has been used for other mob meetings. Officials from D Graphics could not be reached.
While Jimmy Marcello was behind bars, his brother, Mickey, had even more clout than running a video gambling business. He allegedly ran Cicero for the mob. And Mickey Marcello and reputed mobster Alfonso Tornabene were helping run the Outfit itself for Jimmy Marcello, one mob informant told federal authorities, according to the affidavit. Tornabene declined comment Friday.
Jimmy Marcello, who lives in the Lombard area, got out of prison in November 2003 and retook the reins, but troubles soon re-emerged. Days after he regained his freedom, the FBI and IRS swooped down on M & M Amusement.
Agents seized records, equipment and cash.
Mickey Marcello had been worried something was coming.
In a series of secretly tape- recorded calls, the feds heard Mickey Marcello and two underlings nervously discuss a man parked outside M & M who they believed had them under surveillance.
The only problem was, the feds weren't watching.
Just listening.
'Reduced to parking lots'
Agents learned Mickey Marcello's group had contacted someone named "Larry" to run the plate of the suspicious vehicle.
They heard Mickey Marcello tell one of his people to remove records from M & M Amusement relating to cash collections.
And they learned Mickey Marcello and his workers were changing their routines, in one instance opting to meet in the parking lot of the Steak 'n' Egger Restaurant to avoid the nonexistent physical surveillance.
Mickey Marcello was heard laughing during one exchange and lamenting, "Reduced to parking lots."
The Steak 'n' Egger was one of dozens of places that used video poker machines from Mickey Marcello's firm, the FBI alleges.
Among all the establishments, the mention of the Steak 'n' Egger in the affidavit is the most noteworthy. The restaurant is tied to Willow Springs Mayor Terry Carr, who owns the chain and is the son of former Cook County Commissioner Al Carr.
Terry Carr said the two Steak 'n' Eggers he owns in Cicero do not have the machines. But he didn't know if a third one that he franchises has the machines. Regardless, Carr said he would look into changing the language in his franchise agreement to create restrictions on video gaming devices.
The town of Cicero itself comes up in the investigation.
The secret recordings suggest that Mickey Marcello and his crew had a contact within Cicero government in 2003 whom they could go to with problems.
In August 2003, for instance, Mickey Marcello learned that a competitor had installed two video poker machines in a club M & M was doing business with.
Two minutes later, a clearly bothered Mickey Marcello called one of his underlings to tell him.
The underling responded: "Son of a bitch, he took ours out, the bastard."
Mickey Marcello's employee said he was going to see a Cicero town employee, referring to him by a distinctive nickname.
That official is not identified in court documents, but a town employee with the same nickname denied last week knowing Mickey Marcello or his underlings.
Cicero Police Supt.Wayne Johnson said Friday he would look into the matter.
'He's got a big mouth'
Mickey Marcello has deep ties to the Cicero mob.
He was connected to Michael Spano Sr., the onetime reputed Cicero mob boss now in prison for a scheme to defraud millions of taxpayer dollars from Cicero.
A financial company tied to that scandal gave Mickey Marcello a $16,000 loan for a boat, part of which he never paid back.
Mickey Marcello had no comment on the allegations in the court filing.
"I appreciate your call, but I'm not interested" in talking, he said.
While Jimmy Marcello is considered tough and shrewd, Mickey Marcello is regarded by investigators as less intelligent.
When Jimmy Marcello still was in prison, at least one informant relayed to the FBI that Mickey Marcello was bragging about what was to come when his brother got out, a law enforcement source said.
"He's got a big mouth, and there was some surprise among some of our sources, he'd been bragging that as soon as his brother got out of jail, he was going to take over, and Mickey would have a much bigger position," the source said.
If that's true, it's probably something "you'd keep pretty close to the vest," the source said. "He didn't sound too bright, and usually that ends up getting you hurt."
Neither Mickey Marcello nor his brother have been charged with a crime in this case.
Charges in the mob murder investigation are expected sometime this spring, and Jimmy Marcello and numerous other reputed mobsters are targets, law enforcement sources said.
Mickey Marcello appears resigned to going to prison for gambling crimes, according to the tape recordings.
He has no criminal record, according to the affidavit.
When Mickey Marcello visited his brother in prison in January 2003, Jimmy Marcello mentioned the possibility of Mickey Marcello getting "locked up."
"I know it's gonna happen," Mickey Marcello said.
"Maybe we could avoid it somehow," Jimmy Marcello responded.
Mickey Marcello said, "I'm not worried about [it] so much.
"What are they going to do, give me two f - - - - - - years?"
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