Deal Galleys Cover Intro

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DEAL WITH

THE DEVIL

THE FBI’S SECRET THIRTY-YEAR

RELATIONSHIP WITH A MOB KILLER

P E T E R L A N C E

WILLIAM MOR ROW

An Imprint of HarperCollinsPublishers

DealDevil_i_xxii_1_652_1P.indd 3 3/1/13 3:21 PM



INTRODUCTION

Gregory Scarpa Sr. was a study in complication. A peacock dresser, he

carried a wad of $5,000 in cash at all times.1 He wore a seven-carat pinky

ring and a diamond-studded watch.2 He made millions from drug dealing,

hijackings, loan sharking, high-end jewelry scores, bank heists, and stolen

securities. He owned homes in Las Vegas, Brooklyn, Florida, and Staten

Island, and a co-op apartment on Manhattan’s exclusive Sutton Place. He

was the biggest tra cker in stolen credit cards in New York and ran an

international auto theft ring.3 A single bank robbery by his notorious Bypass

crew on the July 4 weekend in 1974 netted $15 million in thirteen duf-

fel bags full of cash and jewels.4 His sports betting operation made $2.5

million a year. His crew grossed $70,000 weekly in drug sales.5 And yet,

fteen years after becoming a made member of the Colombo crime family,

when he was a senior capo, Scarpa was arrested for “pilfering” coins from a pay phone.6 He simply couldn’t resist a chance to steal—even a handful of

change from the phone company.

Five foot ten, two hundred and twenty pounds,7 Scarpa was described

by one of his FBI contacting agents as “an ox of a man; like a short piano

mover [with a] thick neck and huge biceps.”8 For more than forty-two years,

as a “made” member of the Colombo family (or “borgata”), he roamed the

streets of Brooklyn like a feudal lord, earning the nicknames “e Grim

Reaper,”9 “e Mad Hatter”10 “Hannibal Lecter,”11 and “e Killing

Machine.”12 He even signed personal letters with the initials “KM.”13




xiv Introducti on

But Scarpa was also a homebody

with three separate families. In 1949

he married Connie Forrest. ey hadfour children, including Gregory Jr.,14

who started doing crimes for his father

at the age of sixteen.15 en, while still

married to Connie, whom he shipped

o to New Jersey, Scarpa moved in

with Linda Diana, a gorgeous brunette

nineteen years younger, who had been

dating wiseguys since her mid-teens.16

Scarpa had two children with Linda,

but in an e ort to hide the fact that

they were Greg’s, she married a man

named Schiro, who believed the kids

were his own. en, in 1975 while still

married to Forrest and living as Linda’s

common-law husband, Scarpa ran o to Las Vegas and married Lili Dajani,a thirty-ve-year-old17 former Miss Israel.18 Years later, Dajani’s lover, a for-

mer abortion doctor named Eli Shkolnik, was murdered on Scarpa’s orders.19

Yet in 1979 Scarpa agreed to let Linda carry on a torrid sexual relationship

with Larry Mazza, a handsome eighteen-year-old delivery boy—and later

made Mazza his protégé, schooling him in the crimes of loan sharking,

bank robbery, and homicide.20

“I started out one way and ended up with the devil,” Mazza later said. 21

e former grocery worker expressed shock when Scarpa once suggested tohim that they kill the mother of a mob turncoat in order to demonstrate

“what happens to rats.”22

Still, Scarpa, who bragged that he “loved the smell of gunpowder,”23

had no compunctions about killing women. When he heard that Mary Bari,

the beautiful mistress of the family underboss, might talk to authorities, he

had her lured to a club, then shot her in the head point-blank and dumped

her body in a rolled-up canvas two miles away. Later, when the dog of one

of his crew members’ wives found a piece of the dead woman’s ear, Scarpa

joked about it over dinner.24 “He was just a vicious, violent animal,” said

Mazza. “Unscrupulous and treacherous . . . just a horrible human being.”25

Greg Scarpa Sr. aka “e Grim Reaper”




Introduc ti on xv

And yet Scarpa’s daughter, “Little Linda” Schiro, described him as

“incredibly loving—the kind of dad who was there for us every night for

dinner at ve o’clock. Whatever he was on the outside, he was really gentleat home.”26 Like a true sociopath, Scarpa was apparently capable of shifting

at will from brutal murderer to loyal dad. After one bloody rubout, when

Mazza and Scarpa shot a rival in the head, they went home to play with

Greg’s infant grandson, drink wine, and watch Seinfeld on TV.27

“He could transform himself,” said Little Linda. “He could go kill

someone and ve minutes later he’d be home watching Wheel of Fortune

with my brother and me.”28

e Grim Reaper ruled irteenth Avenue in Bensonhurst with an

iron st. He was responsible for more than twenty-ve separate homicides

between 1980 and 1992. With Mazza’s help, Scarpa killed three people in

one four- week period. He shot one of his victims with a rie while he was

stringing Christmas lights with his wife.29 He killed a seventy-eight-year-

old member of the Genovese family because the old man happened to be

in the wrong place at the wrong time.30 en, a few weeks later, after FBI

and NYPD surveillance had been pulled away from a Ma

a social club, herolled up next to Colombo capo Nicholas Grancio and when his own rie

jammed,31 he ordered him shot.32 Grancio’s nose was blown o and one of

his teeth was later found in a nearby building. At another point, tipped that

Cosmo Catanzano, one of his crew members, might talk to the Feds, Scarpa

ordered his grave dug in advance of the murder, but Catanzano escaped

when DEA agents arrested him before the execution could take place.33

“e man was the master of the unpredictable and he knew absolutely

no bounds of fear,” said Joseph Benfante, one of Scarpa’s former lawyers.34 “If he’d lived four hundred years ago, he would have been a pirate.”35 e

brazen Scarpa even gave himself a reason to wear an eye patch. In 1992,

after being diagnosed with the HIV virus and given only months to live,

he broke house arrest and went after a pair of local drug dealers who had

threatened his younger son.36 In the ensuing gun battle, Scarpa got his right

eye shot out, but he walked home and downed a glass of scotch before Larry

Mazza was summoned and drove him to the hospital.37

“Scarpa had an action jones,” one former assistant district attorney

recalled.38 Another investigator described the killer’s need to stay on the

edge: “Capos ain’t supposed to be out on the street hijacking trucks, doing




xvi Introducti on

drug deals,” he said. “I mean, that’s why you have a crew. But Greg was

there. He always had to walk point.”39

And yet, even as he openly disparaged “rats,” Scarpa devoted more thanthree decades o and on to betraying his larger “family,” the Colombos.

e Secret Files

e 1,153 pages of les uncovered in this investigation reveal that, more

than two years before celebrated Ma a turncoat Joseph Valachi “sang” to

the McClellan rackets committee in a historic series of hearings televised

from coast to coast, Scarpa was already coughing up the family’s most inti-

mate secrets to the FBI.

e detailed multipage memos called airtels (later designated as FBI 209

forms) show that Scarpa, whose code designation was NY 3461-C-TE, met

two or three times a month with agents from the FBI’s New York Oce.

During these secret sessions, conducted in hotel rooms, automobiles, and

Scarpa’s various homes in Brooklyn, he fed them the kind of inside-the-family dirt that J. Edgar Hoover craved. Every one of those airtels went straight to

the Director himself, and as we’ll see, while many of the debriengs con-

tained detailed intelligence on the organizational structure of the Ma a,40

“34,” as he was known, also gave the Bureau reams of disinformation.41

A brilliant Machiavellian strategist, Scarpa not only stayed on the street

for forty-two years, avoiding prison after twenty separate arrests or indict-

ments for his crimes,* but he repeatedly “ratted out” his competition in the

family—literally eliminating many of the capos above him along with thetwo family bosses: Joseph Colombo42 and Carmine Persico.43 He also suc-

ceeded in fomenting a series of internal conicts or wars that tore the bor-

gata apart.

It was Scarpa whose duplicity paved the way for the notorious assas-

sination attempt on Joseph Colombo at an Italian- American Civil Rights

League rally in front of fty thousand people in 1971.44 It was Scarpa whose

back-door machinations ignited the second Colombo war between wiseguys

* See Appendix C.




Introduction xvii

loyal to Persico and the violent Gallo brothers in the early 1970s, and it was

Scarpa who fueled the battle that led to the infamous rubout of Crazy Joe

Gallo in 1972.45 Most important to the Feds, it was Scarpa who providedthe probable cause that led to the Title III wiretaps in the historic Ma a

Commission case in the mid-1980s, sending Persico and two other New

York bosses to prison for life.46

In 1989, Everett Hatcher, a decorated DEA agent, was gunned down

by Scarpa’s nephew Gus Farace, who was a member of Greg’s Wimpy Boys

crew.47 at cold-blooded shooting led to the formation of a ve-hundred-

man FBI/DEA task force and an international manhunt that lasted more

than nine months. New evidence now suggests that it was Scarpa who

later set up his own nephew’s murder to take the heat o the other New

York families.48

Scarpa was such a master chess player that he used his position as a Top

Echelon informant to earn hundreds of thousands of dollars, beyond the

millions he made from racketeering. Not only did the FBI pay him more

than $158,000 in fees and bonuses for his services,49 but his control agent

from the mid-1960s to the early ’70s, Anthony Villano, brokered kickbacksfrom insurance companies for some of the high-end hijackings Scarpa was

executing.50 ose “rewards,” amounting to tens of thousands of dollars,

went back to Scarpa for his own thefts of “swag” ranging from liquor to

negotiable stocks to gold bullion, jewelry, and Mercury. Scarpa even got

a cut of a reward for the return of the famous Regina Pacis jewels after a

gang of junkies stole the coveted items from a Brooklyn church. at led

to national headlines for the Bureau after Villano negotiated the recovery.51

e Killing Machine also worked for the government in a series of “black bag jobs” that he performed o the books. e rst was his well-

known trip to Mississippi in the summer of 1964, when he tortured a Ku

Klux Klan member in order to solve the mystery of the MISSBURN case—

locating the bodies of slain civil rights workers Goodman, Schwerner, and

Chaney when FBI agents assigned to the probe came up empty.52

After breaking a second civil rights murder in 1966 as an FBI “special”

asset,53 Scarpa traveled to Costa Rica in the early 1980s to extradite fugitive

Colombo capo Anthony Peraino, the notorious porn king who had made

millions from the production of the lm Deeproat .54

In return for his assistance to the Feds, Scarpa collected in spades, using




xviii Introducti on

his inuence with the FBI to avoid prosecution on three separate indict-

ments by organized crime strike forces over the years. Not only did he beat a

1974 indictment for stealing $520,000 in securities and conspiring to coun-terfeit, transport and sell $4 million in IBM stock,55 but when Secret Service

agents arrested him in 1986 for credit card fraud, on charges that could

have led to seven years in prison and a $250,000 ne, the FBI intervened

and helped him get his sentence reduced to probation and a $10,000 ne.56

By that time, Scarpa had been infected with HIV after a tainted blood

transfusion and was given only months to live.57 At least that’s what the

government told the sentencing judge. If he’d gone to prison then, Scarpa

would never have been on the street to foment his last great conspiracy: the

third Colombo war. But he lived for another six years.

e man who vouched for him during the time was Roy Lindley

DeVecchio, known in the Bureau as “Mr. Organized Crime” for his pur-

ported success putting wiseguys away. After ocially reopening Scarpa in

1980 after a ve-year hiatus, Lin, as he was known, quickly rose through the

Bureau ranks, commanding two organized crime squads. He also taught

informant development at the FBI Academy and became supervising caseagent on the Ma a Commission case, due in large part to his “manage-

ment” of Informant NY 3461-C-TE, known as “34” for short.

But defense attorneys would later allege that Lin’s relationship with

Scarpa was an “unholy alliance.” In 1994, the FBI opened an Oce of

Professional Responsibility internal a airs investigation after four agents

under DeVecchio e ectively accused him of leaking key intelligence to the

Ma a killer.58 DeVecchio, who refused to take a polygraph test, was never-

theless granted immunity during the probe, making it virtually impossiblefor the Justice Department to indict him. In 1996, he retired with a full

pension. Later, he was granted immunity a second time, but he answered,

“I don’t recall,” or words to that e ect, more than fty times at a 1997 hear-

ing as defense lawyers tried to peel back the layers obscuring his clandestine

dealings with Scarpa.59

In March 2006, the Brooklyn district attorney unsealed an indictment

charging Lin DeVecchio with four counts of murder stemming from his

twelve-year relationship with Gregory Scarpa Sr.60 e following year, after

an aborted two- week trial, those charges were dismissed. But not before

Scarpa’s protégé Larry Mazza testied that his homicidal mentor had




Introduction xix

“stopped counting” after fty executions.61 Said Scarpa’s own daughter,

Little Linda Schiro, “It was like growing up with a serial killer.”62

e Killing Machine’s most violent period came during that thirdColombo war, which he incited. e death toll during that conict was

fourteen, and the evidence demonstrates that Scarpa was personally respon-

sible for at least six of the hits. Each time he executed a signicant rubout,

Scarpa would punch the satanic digits 6-6-6 into the pager of his consigliere

to let him know that the job was done.63

A nal murder he committed four days after Christmas in 1992 brought

the number of homicides he’d ordered or executed on Lin DeVecchio’s

watch to twenty-six. at gure amounted to more than half the murders

Mazza says Scarpa committed before he quit keeping track.64 (Mazza later

rea rmed the number in a 2012 interview with the New York Post .65) ose

fty homicides made e Grim Reaper perhaps the most prolic hit man

in the history of organized crime and put him in the ranks of the world’s

top serial killers.66 e fact that most of those deaths occurred while he was

being paid as a virtual agent provocateur by the Feds is a testament to the

FBI’s willingness to make “a deal with the devil,” as DeVecchio’s trial judgeput it.67

A Month in Jail Over More an Four Decades

In more than forty-two years as a hyper-violent gangster, Gregory Scarpa

Sr. served only thirty days in jail—and that was during the years when he

was “closed” as an FBI source. e rest of that time, a series of FBI agentsintervened to keep the so-called Mad Hatter on the street. But that wasn’t

the most disturbing aspect of Scarpa’s relationship with the government.

In light of the 1,150-plus pages of FBI les on Scarpa we’ve now accessed,

it can be fairly argued that the FBI’s very playbook against La Cosa Nostra

was dened and shaped by what Scarpa fed them—particularly in the years

from 1961 to 1972, when J. Edgar Hoover himself was on the receiving end

of “34’s” Airtels. Given the Bureau’s relationship with Scarpa, it’s no surprise

that a senior federal judge sentenced one minor Colombo capo convicted

in 1992 to multiple life terms for crimes far less repugnant than Scarpa’s.68

Even as he was being ravaged by the HIV virus—shrinking from 220




xx Introducti on

pounds to an emaciated 116 toward the end of his life—Scarpa beat the real

grim reaper by many years, staying alive to commit multiple homicides as

he schemed to take over the family in the phony war he’d engineered. Few gures in the annals of organized crime have operated with such tenacity,

deviousness, and reckless disregard for human life. e fact that he served

as the FBI’s secret weapon, against what Lin DeVecchio calls “the Ma a

enemy,” only underscores the moral ambiguity that runs through this story.

Drawing on secret FBI airtels never before seen outside the Bureau, in

the pages ahead we’ll reveal how Gregory Scarpa Sr., then a young capo for

the Profaci crime family, led J. Edgar Hoover himself into the inner sanc-

tum of the underworld. Once that alliance began, there seemed to be no

turning back for the Bureau. “ey enlisted a violent killer to stop much less

capable murderers,” says defense lawyer Ellen Resnick, whose work helped

expose this “unholy alliance.”69 “It was the ultimate ends- justify-the-means

relationship.”

As you turn the pages of this book, there are two crucial questions to

keep in mind: Who was in charge: the Special Agents like Tony Villano and

Lin DeVecchio, who were responsible for “controlling” Scarpa, or the killerhimself? And who got the most out of this deal with the devil: the FBI or

the very “Ma a enemy” they sought to defeat?

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