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The Commission's agenda for the second day of its public hearing highlighted the involvement of out-of-state mobsters-from New York and Pennsylvania-with New Jersey check cashers in the promotion of scams that would provide a cash flow for a variety of illegal activities, including loansharking and money laundering. The initial scenarios outlined by witnesses concerned members and associates of the Gambino and Genovese organized crime families in New York, who profited from the willingness of certain New Jersey check cashers to accept without question the checks of New York corporations, many with obviously fictitious payees. These checks could not be cashed in New York because they either exceeded the statutory limit of $2,500, or because the only bank in New York City that would process check casher transactions refused to accept checks representing business receivables. As a result of the stringent limitations, regulatory and otherwise, on check cashers in New York, compared with New Jersey's more liberal regulation of the industry, both mobsters and independent swindlers developed a lucrative trans-Hudson courier system for cashing New York business checks in order-more likely than not-to shield huge sums of money from federal or state income taxes and for other illicit purposes.
Prober Confirms NY-NJ Mob Ties
Gregory J. Stasiuk, a principal investigator and accountant for the New York Organized Crime Task Force, confirmed the Gambino mob's role in interstate check cashing. He backed up his testimony with secret recordings by a task force informant of conversations with Gambino gangsters. Counsel DiBuono questioned Stasiuk:
Q. Have investigations in New York identified members of organized crime using check cashing services in New Jersey?
A. Yes, they have.
Q. Would you please elaborate.
A. For approximately three years we had an associate of the Gambino [organized crime] family cooperating with our office as a confidential informant. During that time he consented to have his conversations with criminal associates recorded. He made more than 350 tape-recorded conversations with other Gambino associates, Gambino soldiers and even the upper echelon of the Gambino family. On April 10, 1986, he had a conversation with an individual who was another Gambino associate identified as Butch. In this conversation, Butch related how [he and] a friend of his, who was identified as Joey from Brooklyn, were making money together [by] cashing checks at a check cashing service in New Jersey that Joey had connections with.
Tax Evasion Worth Usurious Fees
The taping of the informant's conversations with "Butch" and "Joey"-the Gambino associates-was broadcast at the hearing. It demonstrated, by means of often obscene dialogue, that the New York mobsters were charging their "clients" as much as 10 "points"-gangland loanshark argot for usurious interest-per check amount and sharing the difference between the New York levy and what their New Jersey check cashing cronies would demand as "fees." The conversations indicated that "Butch" and "Joey" often split as much as seven points after their New Jersey transactions were completed, meaning that the New Jersey check cashers were satisfied with as little as three points per check amount (still at least twice the limit of 11/2 percent allowed by New Jersey on out-of-state checks.) Stasiuk interpreted various parts of the informant's conversations with the Gambino henchmen to clarify the recording. For example, "Butch" and "Joey" talked at one time about "burying" checks. This was explained by Stasiuk:
What he means by "burying" checks is hiding the money, hiding income, and [Butch] states why a person is willing to give up 10 percent if they're cashing a check-in the case of a $5,000 check it would be $500-and he says he's saving more than $500. Yeah, he's giving up $500 but he's saving more than that if he has to put it in his account and then declare it at the end of the year in taxes.
"Dummy Payrolls" Scam
Stasiuk also interpreted a part of the recording which the informant and "Butch" talk about
sing false Social Security and W-2 identifications they can be put on "dummy payrolls," another
mob-concocted money making scheme:
Q.Would you please interpret what [Butch] discussed?
A.In this last segment our informant and Butch discuss giving out their Social Security numbers in order to be put on dummy payrolls. Our informant says, "Yeah, dummy payroll. I've been doing that for years. That's how i saved myself with the Internal Revenue, you Know, you know that?" Well, in support of this, during the period the informant was working with us, he gave us W-2 [forms] from two different Gambino-associated construction companies. Now, these W-2s were given to him by his capo or captain in the Gambino family. [But] he never saw a check from either of these companies. Now, what the dummy payroll scheme does for the organized crime enterprise [is] it gives a benefit in two ways. First, it provides a way in which money can be siphoned out of the business by writing a check payable to an associate of organized crime and that check is, in turn, just cashed. If the organized crime associate is ever approached by law enforcement saying, "Did you ever work for this company," he's told to say, "Yes, I worked for that company," but it also by doing this gives a benefit to the organized crime associate himself because it gives him the appearance of a legitimate source of income, which in turn is going to be withheld for taxes-taxes will be withheld and paid and
meanwhile he goes on doing his illegal activities [while making] it appear that he has a legitimate source of income.
Q. Mr. Stasiuk, have you identified any other occasions where Gambino associates have had contacts with New Jersey check cashers?
A. Yes, we have had in New York toll analyses indicating that high-level Gambino associates have been making telephone calls to check cashers in New Jersey.
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Drunken Jamie, Jersey City's Own Howard Stern Character
Bret Schundler's Big Win
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New Jersey Fact:
"New Jersey is a small state on the eastern seaboard halfway between Honest John Lindsay and the Liberty Bell. It is best known for its turnpike, Atlantic City, Imamu Baraka, Newark Airport and the Morro Castle disaster. Most of its leaders are in jail for stealing money...."
Over thirty years ago, this was how a New York Times writer described New Jersey. The only things that have changed are that now Bloomberg has Lindsay's old job and Amiri Baraka figured out somewhere along the line that it's not too swift for an atheist to use a religious title.
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Hudson County, New Jersey is a place of many firsts - including genocide and slavery.
Political corruption is a tradition here.
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