Chris Petti got the good news three days before Christmas, 1987: His move to take over gambling on the Rincon Reservation had been approved at the very top of the Chicago Mafia.
"They wanna go with that thing," Mike Caracci told him. "They wanna get a foothold down where you're at."
The call followed a familiar pattern. Caracci rang Petti's San Diego home and gave him a number. Petti hurried across the street, to a pay phone outside a 7-Eleven, and dialed it.
Moments later, Caracci was telling him from Chicago how the acting boss there, Sam Carlisi, had given the crucial OK. "He said, '(Expletive) it, let's go, do it, do it.' "
Petti, the crime family's top contact in Southern California, had been working toward this moment for a year. He had nurtured a tribe member to grease the wheels on the reservation. He had found a front man whose name could be sent to the Bureau of Indian Affairs. And he had endured the frustrations of dealing with the Indians, their changing demands, family squabbles and the suspicious questions of one stubborn woman on the Rincon Tribal Council.
But now that Chicago was on board, he figured on making a fortune with bingo, cards and off-track betting on the remote reservation in Northern San Diego County.
Only one thing could mess up the deal, Caracci cautioned him.
"The O.C. label," Petti replied.
"You gotta really be careful," Caracci said.
FBI organized crime agents logged the call at 8:33 a.m. They had been eavesdropping on Petti for six months.
A veteran of the cops-and-robbers game, he thought he was safe doing business from 27 pay phones around San Diego. He hadn't counted on a new federal "roving wiretap" law that empowered agents to monitor a series of phones used by a suspect.
Thousands of pages of wiretap reports would document the Chicago mob's move to infiltrate the Rincon Reservation, show collaboration with mob families across the country and suggest organized crime ties to other reservations as well.
To this day, government officials and Indian leaders generally belittle the threat posed by organized crime to the gambling that has become the $1-billion centerpiece of tribal economies. They dismiss warnings of mob interest as paranoia or the rantings of people trying to infringe on Indian profits.
But those officials probably never heard of the Rincon wiretaps--there was no prosecution to bring them to light. After two years of plotting, the Chicago crime family lost interest in the reservation. The FBI, in turn, shifted its efforts to Petti's involvement in a juicy money-laundering case.
Lost in the shuffle were wiretaps that are a primer in how the mob can get a foot in the door of gambling halls, and how it counts on skimming and lax oversight to cheat tribes out of revenue sorely needed by some of the poorest people in America.
As Chris Petti put it to his main Indian contact: "Let's grab some money, pal."
The promise of gambling had been hard to resist for Indians throughout California.
They had no vast ancestral lands with natural resources such as timber or minerals. Displaced by Spanish missions, miners and other white settlers, they wound up on 96 small reservations or postage-stamp "rancherias" in the desert or mountains. "Pushed into the rocks," an anthropologist termed it.
Rincon was one of the more scenic, set in a valley surrounded by brush-covered hills. Only a third of its 3,975 acres was flat, however, and the land could barely support light farming, grazing and orchards.
By the mid-1980s, unemployment stood at 60% among the 300 Luiseno Indians. To make ends meet, many rented makeshift housing to migrant workers, setting down shacks, garages and camper shells on the dusty landscape, often without plumbing.
Tribal leaders didn't waste time when court decisions gave then competitive advantages first in bingo, then other games. After inviting proposals by outside investors, they picked Charles Schlegel, an Orange County businessman with a theatrical flair.
He built a 23,000-square-foot, Spanish-style hall, distributed buttons promoting the place and hired dozens of tribe members. Then he sat in a crow's nest watching the festivities, smoking a cigar.
Old-timers such as Max Mazzetti were thrilled to help tally the handle when the games began in 1984. "I remember one night we were counting, $154,000 the one night!" the 70-year-old Mazzetti recalled. "It was really something for Rincon!"
There was one problem. The tribe saw no profits.
Schlegel, who is now dead, was supposed to share any profits--but said there were none. Though he had taken in $10 million, it was impossible to finish in the black, he said, while offering the jackpots needed to compete with other Indian bingo halls opening around the state--one at the Barona Reservation, just to the south.
He closed Rincon's hall in June, 1985. A second manager was hired, but also reported no profits. Before he left as well, he added a new attraction in late 1986, a card room with 30 poker tables.
That December, the room was raided by San Diego County sheriff's deputies, who said it was offering illegal Chinese variations of poker. To tribe members, it seemed like another example of prejudice against them. "They're trying to give the Indians a hard time," the poker manager declared.
Chris Petti was a frequent visitor to the poker parlor. In fact, a friend who went with him said he "acted like he was in charge," according an affidavit filed in federal court in San Diego by FBI agents seeking a wiretap.
The FBI had been interested in Petti, now 64, for years. Originally from Illinois, he had surfaced in San Diego as bodyguard and chauffeur for the amiable elder statesman of California mobsters, Frank Bompensiero.
When "The Bomp" was gunned down in 1977, Petti stepped in to fill his shoes. He soon had his own live-in chauffeur.
A trim man with blow-dried gray hair, he was a neat dresser--matching his tie and breast handkerchief--and a follower of routines. He would have lunch on Hotel Circle north of downtown, then spend the afternoon at the Stardust Hotel & Country Club, whose steam room served as his unofficial office.
Evaluations of Petti's stature in the Mafia are a reminder that such intelligence is an imprecise art. One survey listed him the 48th most affluent mobster in the country, but Petti lamented in wiretaps, "I'm in bad shape," and some downplayed him as a "hanger-on," a man of Greek extraction (given name Chris Poulos) trying to impress the traditionally Italian crime families.
He had convictions in San Diego for bookmaking and for using a baseball bat in 1979 to assault a man who complained about a noisy party. Quoted as saying he wanted to help the man "get some sleep," Petti was fined $1,000.
The chance to get a handle on Petti's activities fell into the FBI's lap in August, 1986, when a friend named Robert Benjamin, a career criminal facing a bank fraud charge, agreed to work under cover for agents.
Petti was dealing directly with the boys in Chicago, Benjamin reported. Their immediate chore was taking over accounts of recently murdered Tony (The Ant) Spilotro, who collected a "street tax" from bookmakers throughout Nevada and Southern California. But Petti's real passion was "the Rincon Indian Reservation," according to the affidavit.
The key to it, Benjamin said, was Petti's close relationship with tribe member Glenn Calac, whose father was on the Rincon council.
The security chief at the card room, Calac was hard to miss. A shade over six feet tall, he weighed close to 300 pounds and drove a new white Cadillac. Calac, who had what federal prosecutors called an "extensive criminal record," including a felony burglary conviction, exerted influence through "muscle" and payoffs, Benjamin said.
When he questioned Petti's interest in a venture that seemingly lost money, Benjamin said, he was told that, in gambling, all is not what it seems. He said he overheard Petti say that in the card room, for instance, Calac already was "swallowing" profits, not reporting revenues to the tribal council.
This wasn't like Nevada, where the Gaming Control Board audited your books and paid surprise visits to your counting room. You only had to show the Indians a profit-and-loss column at the end of the month, Petti said.
A lot of money listed as a loss really wasn't. It "sticks to your fingers," he said.
There is long precedent for denial when it comes to organized crime in America.
No less than J. Edgar Hoover refused to believe there was a Mafia until 1957, when its leaders were caught meeting in Upstate New York. In Las Vegas, never mind that Bugsy Siegel opened one of the first casinos and investigations found mob links to 10 others. "Many Nevadans," recalled former federal prosecutor C. Stanley Hunterton, kissed it off as "a federal vendetta against their state."
Warnings of "O.C." interest in Indian games similarly have been met by skepticism.
"In 15 years of gaming activity on Indian reservations there has never been one clearly proven case of organized criminal activity," Sen. John McCain (R-Arizona) said upon the 1988 introduction of legislation to create a National Indian Gaming Commission.
The threat was dismissed with comic flair last year at a Las Vegas meeting of tribal leaders and Tony Hope--a lawyer and the son of entertainer Bob Hope--who was named by President Bush to head the commission.
When an Apache official complained that Arizona's attorney general saw the Mafia behind every cactus, Hope offered a story to reassure the Indians that he understood the ludicrousness of such a notion:
"I have this image in my own mind when they talk about Mafia infiltration. On the outskirts of Las Vegas, at six in the morning. A black Lincoln. Six people come out of a house in black suits, black hats with a bunch of guns, open the trunk of the Lincoln and speed out across the desert 300 miles to put the muscle on"--now the punch line--"30,000 heavily armed Indians."
The crowd burst into laughter.
Chris Petti's car was a Lincoln. On March 21, 1987, his driver eased it up to the east terminal at San Diego's Lindbergh Field to meet two men from Chicago: Michael C. Caracci, 53, and Donald (The Wizard of Odds) Angelini, 65, described by the FBI as overseer of the Chicago mob's gambling interests.
On the way to Rincon, they met Calac at a bakery in Escondido. An agent overheard snippets of talk: "Chips, everything all ready." "Not an unreasonable contract."
The men returned the next month. Over dinner, Benjamin reported, the white-haired Angelini announced that the operation was going to be run "our way."
Traveling under the name "Brooks," Angelini was a detail man. He noted that the bingo hall was 41 miles from Hotel Circle, that it needed stucco and had cracks in the parking lot. He weighed the pros and cons like a classic middle manager, which he was, as a mob "capo," just below the very top leadership.
Caracci, Angelini's brother-in-law, was a step lower on the totem pole, assigned to "reassert the influence of the Chicago syndicate on the West Coast," federal authorities said.
Three months later, Angelini flew back to California. Agents reported a meeting in Los Angeles with the businessman Petti proposed as a "front," Sam Kaplan, a feather supplier who since has died.
Kaplan has been around "people," Petti said, but had a clean record, having even passed screening by the state attorney general's office when his name was submitted with a card room proposal for Imperial Beach.
Now his name would go atop the prospectus submitted to Rincon.
Ten other groups wanted to run the gambling there after departure of the last manager, including a pair of former police officers. But when Petti returned from the Los Angeles meeting July 12, his phone rang with an optimistic message.
"Everything is going forward," Calac told him.
U.S. District Judge Gordon Thompson Jr. had approved the "roving" wiretap three days earlier. All told, agents would intercept 6,033 calls.
They recorded Petti and Calac discussing several reservation deals around California. One gambling promoter was impressed with Petti, Calac said, and "won't make a move without first going through you." Another time, Calac lamented that a veteran bingo manager--who has worked throughout the state--preferred "to go through" two reputed Palm Springs-area organized crime figures.
The Rincon plot solidified in the fall of 1987, when California approved off-track wagering on horse races. Under court rulings, reservations could offer it too. By Nov. 11, in a call to Chicago, Petti envisioned almost a full casino, with horse betting added to the cards and bingo.
Caracci: "Gee, that's a big winner, don't you think?"
Petti: "You'll handle two or three hundred thousand a (expletive) day."
Caracci: "I just want to make sure we get it, if anybody's gonna get it."
Their proposal guaranteed the Indians $30,000 per month, plus 51% of any profits--although "they'll never see" that part, Calac noted in a call to Petti. The tribe would have to agree, he said, because "money talks."
But Petti and Calac underestimated the difficulty of getting anything through Rincon's fierce clan politics. Chicago soon was asking: Why are those "(expletive) morons" taking so long?
As Calac explained it, his fellow Indians always argue, "go around in circles." He said he finally told them: "We're going to sit down and you're either gonna (expletive) do it, or I'm walking away. You guys aren't gonna have (expletive) and we're gonna go to the Palm Springs Indians."
He was particularly frustrated Dec. 9, when the Tribal Council held a hearing on gambling proposals. A San Diego attorney delivered a $1,000 fee to accompany the application bearing Kaplan's name.
That night, Calac phoned Petti to report they "almost had it." But a woman on the council kept asking about Glenn Calac's tie to the project. She also ranted on about Kaplan not being there in person.
"How do we know this man really exists?" she asked. "He could be some name you took off a tombstone."
Petti wants to know: Who's making all the trouble?
It was Glenn's cousin, Ruth Calac. She was very suspicious.
Ruth was not morally opposed to gambling, but was appalled by the promoters who approached the tribe. One offered a stereo system as a "gratuity." Another promised "under the table" payments. A third asked if he could set up private rooms for "hostesses."
She heard stories from other California reservations as well, including how tribal leaders at two of them had been murdered after complaining that Indians weren't getting a fair share of gambling profits. And down at Barona, a bingo manager named Stewart Siegel had just been caught rigging games, planting "shills" in the audience to play prearranged winning numbers.
So when Glenn surfaced in Rincon's card room--she'd known him for years--Ruth began "raising hallelujah."
But he had followers, particularly among three clans of Calacs.
"He's just Glenn . . . he wheels and deals," shrugged another cousin, Doug Calac. "He talks smart. . . . He's collected from insurance companies for people who have got hurt in auto accidents."
Doug and others listened when Glenn told them "I have people" with resources to make the gambling work. With Ruth scheduled to come up for reelection, many Calacs joined the campaign to defeat her.
Petti commiserated with Glenn. Other Indians should appreciate him, Petti said. Wasn't he bringing the best bid? And he never took money from the tribe--he only took from the "other side."
* Dec. 17: In Chicago, Caracci is nervous. He and Angelini are going to see "Wings" Carlisi, the acting crime boss there, for the "final say."
He's not sure how to advise Carlisi on off-track betting. What if they're raided?
Petti: "If they pinch you, you put a restraining order against 'em."
Caracci agrees. They could hire some hotshot lawyer to raise civil rights claims on behalf of the Indians. Someone like Alan Dershowitz from Harvard. Of course, "these lawyers fees, they kill you."
* Dec. 20: In the movies, such meetings take place at round tables over bowls of pasta. In real life, it was breakfast at McDonald's.
At 9:30 a.m., agents from the Chicago office of the FBI watched Angelini and Caracci arrive at the fast food restaurant on Lake Street in Addison, Ill.
Soon after came the chauffeured car of Sam Carlisi.
They met for an hour, then left.
* Dec. 22: 8:32 a.m. Caracci calls Petti and asks if he needs to talk. It's their signal. Petti makes his way to the 7-Eleven and calls a Chicago pay phone, at a car auction business. Caracci fills him in:
The boss hadn't even looked at the contract. "Do it," he said. Just like that, approved a $500,000 investment. Now they have to find ways to get the skim back to Chicago, "filter the money." Caracci can't emphasize enough the need for precaution.
"You gotta be in the background, cause you know they're gonna hook you right up back through here. . . . Then that's gonna be the (expletive) end of it."
Petti: "I don't discuss nothing with nobody."
* Jan. 16, 1988: Caracci says Angelini has selected a Florida man to run the hall.
"This guy is supposed to be a helluva (expletive) promoter . . . and he's with the (bleeping) Indians already, he's got his name down there ah, the Bureau (BIA), in Wisconsin, he's got one of these joints."
They'll have to consult the New York mob, however, because the guy is "with New York."
* Jan. 19: Petti notes that any contract with the tribe will have to go through the BIA.
Caracci: "That's just a stamp, isn't it?"
Several years ago, amid the rapid growth in Indian gambling, BIA officials asked the FBI to conduct background checks on proposed financiers and managers.
"There seems to be some evidence (contracts) don't name the real investors," said Tom Dowell, former superintendent of the BIA's Southern California office.
Although the checks occasionally found a felony conviction--the one ground to disqualify an investor--they did not leave Dowell with much confidence.
"You'd have to have a hell of a background to get noticed," he said. "The guy who stops you on the highway does a better check."
"They came close," tribal elder Mazzetti said later of Petti and his friends. "We were lucky."
Indeed, news from the "res" seemed upbeat for the Chicago crowd. "The elections came out pretty good," Calac gleefully told Petti one night.
Petti: "The elections?"
Calac: "Ruth lost, her big fat ass is out. So you guys are gonna get it."
Later, he confirmed it: "Everything's a go," the tribe had voted.
Then the folks at Rincon started squabbling again. Someone wondered if they could get a better deal by splitting the gambling in two. Maybe get $25,000 a month for the cards alone, extra for bingo.
Petti blew up when Calac told him. He wasn't going back to Chicago and make a fool of himself.
* March 2: Angelini is having second thoughts. "He's hemming and hawing," Caracci tells Petti.
It's not merely the unpredictable Indians. He's wary of the Florida bingo manager, who's an egomaniac and spread thin already. And he doesn't like the performance of another "joint" they have, a non-Indian bingo hall outside Baltimore.
With Rincon, he has the middle manager's worry--that he'll look bad to his bosses. "He don't want to go to these people and get that kind of money," Caracci explains, "and then come up short."
* March 17: The Chicago boys are backing out. Angelini simply isn't comfortable investing the organization's cash at Rincon.
"It's a shame," Caracci consoles Petti. ". . . You got the (expletive) door open."
Of course, if Petti can put together a deal with other investors, Chicago will take a piece of the profits.
Petti isn't fazed. It so happens, he knows a guy who might be interested.
Benjamin had been telling him about a New Jersey man who laundered funds for Colombian drug lords.
It was a cover story to introduce an undercover FBI agent. Petti had never taken the bait before. Now he did.
On April 8, he met "Pete Carmassi"--actually Agent Peter Ahearn--and they drove to Rincon for a tour. Glenn Calac said he would need $15,000 to "lock in" the council, the agent reported later.
This time, they would put Calac's name atop the prospectus. If anyone wondered how he got money to open a gambling hall, he could say it was inheritance from a "Cousin Red Cloud."
But it was a doomed plan. The tribe's attorney reminded Calac his name couldn't be used because of his criminal record. The FBI's interest was soon detoured.
The focus shifted the moment Petti told "Pete," the undercover agent, that he knew a prominent San Diego businessman who could help get money out of the country. It was no less than Richard T. Silberman, onetime chief of staff to Gov. Edmund G. Brown Jr.
In February, 1989, the Senate Select Committee on Indian Affairs held hearings on the "Federal Government's Relationship With American Indians." During a brief portion on gambling, three witnesses gave varying appraisals of the threat of organized crime.
FBI Deputy Assistant Director Anthony E. Daniels said there was mob involvement at the start of Indian bingo in Florida, but didn't see it as a "major problem" at the moment. Of course, penetrating "fronted businesses" was difficult, and "greater infiltration" was likely if tribes opened full casinos.
California Deputy Atty. Gen. Robert Morehouse said mob figures had been spotted on at least two reservations in his state: In 1980, Palm Springs-based Rocco Zangari opened a card room at the Cabazon Reservation. In 1985, James L. Williams of Florida took over bingo on the remote Jackson Rancheria in Amador County.
Then came a third, mystery witness. He said the officials underestimated organized crime.
Identified only as "Marty," he testified behind a screen, his voice distorted.
"Marty" said he had run an Indian bingo hall as a mob front. He had cheated a tribe out of $600,000 a year, he said, but kept peace by paying the chief $1,000 a week as a "consultant."
He claimed knowledge of 12 Indian halls around the country infiltrated by mob families. They skimmed money "through the purchase of supplies, which were nonexistent and overpriced," by padding payrolls and through fixed games--weighting some balls in the bingo mixer, for instance, while lightening others with helium.
But his claims were brushed off by Indian leaders. He was an anonymous loudmouth, a guy with a bag over his head tarnishing them all with a broad brush.
Indeed, there was merely his word for all this at the time. Only much later would an associate of New York mob chief John Gotti be arrested for shipping slot machines to the St. Regis Mohawk Reservation. Only later would the Rincon wiretaps be filed away in a San Diego courthouse.
So few believed "Marty" or his explanation of why he was talking: "I got religion."
But that wasn't the whole story. After he'd been caught stealing, he came down with cancer. Soon after his testimony, he died.
"Marty" was Stewart Siegel, former manager of Barona Indian Bingo, 45 minutes south of Rincon.
Two months after the Senate hearing, Chris Petti was under arrest. So was Richard Silberman. It was a splashy money-laundering case, with Petti eventually sentenced to 30 months in prison, the former politician to 46 months.
The indictment made no mention of Rincon. That plot had never been carried to conclusion, after all.
A month after their arrests, the bingo hall reopened.
The Rincon council finally awarded the contract to a group of businessmen from Los Angeles and Phoenix. Taking no chances this time, the tribe's chairman insisted on a security deposit of sorts: "$120,000 up front, held by us."
It was a good move. The new managers quickly began fighting among themselves. When they couldn't open the hall the fourth day, the tribe padlocked the doors--and kept the $120,000. Six years after the bingo began, it's the only money Rincon has gotten from gambling.
The red, white and blue Rincon Indian Bingo sign still stands along County Route 6, the space to list the daily jackpot vacant. Grass grows through the parking lot. Cows occasionally wander onto the road.
For the Indians, it's little consolation that gambling halls sit vacant on other California reservations. They are aware, as well, of how a few have flourished. Not far away, Sycuan has new housing, an ambulance service and more.
Alternative development proposals are not attractive. Three San Diego area tribes have weighed offers to put dumps on their land.
So Rincon is considering new gambling proposals. "Can you believe it?" asked Ruth Calac.
But you can. On a quiet afternoon, waiting for a rain cloud to roll over Mt. Palomar, it's hard to imagine that a Mafia family 2,000 miles away ever was interested in this neglected turf. Many on the "res" still don't think it happened, including Ruth's own mother.
"That's just a lot of rumors and baloney," she said.
"I have a friend who's organized crime, sure," Glenn Calac said during a brief encounter with a reporter, brushing aside all questions. "Chris Petti. He's a good friend. He's also very poor. I'm poor. The band's poor."
Calac has not been seen around Rincon much lately, tribe officials say.
He's up at the tiny Twentynine Palms Reservation in San Bernardino County. Serving as its business manager, in fact.
Currently pending before California officials is a request from Twentynine Palms for a tribal-state "compact" under terms of the new Indian Gaming Regulatory Act. It would allow off-track betting on the reservation in the desert west of Palm Springs.
Chicago Mob's Role: The Key Players
The Chicago organized crime family acted much like any large business organization as it moved to infiltrate gambling on the Rincon Reservation: A proposal was packaged for a decision by the top boss, then carried out by middle managers. Here were the four key players, according to FBI wiretaps: * CHRIS PETTI: He was the crime family's contact in Southern California. Looking to "grab some money," he proposed taking over the Indian gambling operation north of San Diego using a "front man."
"I guarantee you, you'll handle two or three hundred thousand a (expletive) day," he told Chicago higher-ups. It would be easy to skim profits, he said, because the Indians would have a minimal role: "No counting of the money, no nothing."
* MICHAEL C. CARACCI: He was Petti's contact in Chicago, and was assigned by the family's bosses to reassert their influence on the West Coast. Enthusiastic about the Rincon venture, he told Petti, "I just want to make sure we get it, if anybody's gonna get it. I wanna get it first."
Later, frustrated by the Indians' squabbling and changing demands, he said, "It's a shame . . . They got an opportunity here to finally get some money out of the (bingo hall) . . . and they end up (expletive) around." Petti's response: "You need to stay on these (expletive) Indians a little more."
* SAM CARLISI: He was acting mob boss in Chicago, and he endorsed the Rincon project. A burly, decisive man, he approved a $500,000 investment without even reviewing the gambling contract submitted to the Indians.
"He didn't even bat an eye that guy, you know," Caracci later told Petti. "He said '(expletive) it let's go, do it, do it. . . . Don't even tell me about it. . . . What the (expletive) do I know about a contract?' "
The $500,000 is "like piddling cents to these guys, you know," Caracci noted.
* DONALD ANGELINI: A mob lieutenant and the crime family's gambling expert--and also Caracci's brother-in-law--he was assigned to oversee the venture. He vowed to Petti: The operation is going to be run "our way."
Later, however, he had second thoughts about risking the top bosses' money and pulled out. As Caracci explained it: "All these (expletive) years he has always used his own BR (bankroll) and when you use your own BR, if you blow it, (it) doesn't mean anything, you understand? You take the loss. But he don't want to go into these guys and . . . blow (their money). . . . He's afraid, he doesn't know what the (expletive) they're gonna do."