Much like the other faction leaders in the Genovese organization, Gerardo has also recently been the subject of a racketeering investigation and indictment. As a result of a two-year state undercover investigation, 16 persons in Gerardo's faction were indicted on arson, gambling, loansharking, racketeering and theft charges in May, 1987. Those indicted are accused of operating a $20 million-a-year gambling ring in Newark, Manhattan and Staten Island, and of bilking a union health plan out of $3 million. Using the racketeering statute, the state hopes to obtain forfeiture of $31 million in cash and assets accumulated by the group from its racketeering activities.