2 L.A. Mafia Informants Get Probation

Two former Mafia brothers who went undercover for the government and collected evidence against the Los Angeles crime family had their jail sentences suspended Wednesday for work that authorities said dealt a “knockout punch” to the mob in Southern California.

Craig Anthony Fiato, 45, and Lawrence Fiato, 34, longtime organized crime associates who were among the first government informants to be considered for induction into the Mafia, were sentenced to five years’ probation and fines of $1,000 each for the illegal loan-sharking activities that first led them into the underworld.

“They worked on the streets, undercover, risking their lives on a daily basis for a period of almost two years,” said former organized crime strike force chief James Henderson, one of a small cadre of prosecutors and FBI agents who supported the Fiato brothers’ request for a lenient sentence.

In a memorandum to the court, prosecutor Richard A. Stavin said the Fiatos’ undercover work resulted in the indictment and conviction of reputed Los Angeles Mafia boss Peter J. Milano and his top lieutenants, along with four other indictments against a variety of organized crime figures--a total of 31 in all--on a variety of racketeering, loan-sharking, fraud and extortion charges.

The two brothers had a lucrative loan-sharking operation running in February, 1984, when, suddenly aware that the FBI knew of their activities, they signed an agreement to go undercover and collect evidence against their former criminal associates.

“During this most dangerous of assignments, the Fiato brothers wore concealed body recorders and taped telephone conversations to assist them in gathering evidence against La Cosa Nostra,” Stavin said in his report to the court. “The slightest indiscretion by either brother at this time could have resulted in either serious physical injury or death.”

Henderson said Larry Fiato foiled a hit against a suspected mob informant and yet salvaged the investigation when he faked his own traffic arrest after being ordered to go kill the informant. Craig Fiato, authorities said, was twice nearly discovered wearing a hidden tape recorder when patted down by his Mafia associates.

‘Valuable Service’

U.S. District Judge Ferdinand F. Fernandez said the Fiatos’ own loan-sharking activities--accompanied with threats of violence against debtors who didn’t pay up--represented “a serious offense, indeed a repulsive offense.” By law, the judge could have sentenced them to up to 20 years in prison and a $250,000 fine.

“However, (they) rendered an extremely valuable service to the government in breaking up the power structure of the Mafia here in Southern California,” Fernandez said.

Even living in a new location under new identities (Craig is writing a book about what he calls “the disadvantages” of crime; Larry is going to college, where he is president of the philosophy club), prosecutors say the brothers “remain virtual prisoners of their pasts--with the constant fear that there are many within the Los Angeles La Cosa Nostra and elsewhere who will not forget their betrayal.”

“Six years of my life, wearing that wire, dying everyday,” Craig said as he prepared to go into court Wednesday. “The slightest bit of stress, I fall apart. . . . But you know, we really crossed the line now. We crossed the line.”