17 Indicted in Indian Casino Probe

Federal officials announced Friday that 17 people, including five linked to a Pittsburgh organized crime family, have been indicted for attempting to infiltrate and control the now-defunct gambling casino at the Rincon Indian reservation north of San Diego.

The goal was to tap the enormous profits possible in Indian gambling and to launder $2.1 million made in illegal activities elsewhere, officials said.

“This is a classic example of how organized crime, particularly the La Cosa Nostra, works in the United States,” said FBI Special Agent Peter Ahearn.

The 17 were charged with bribery, money laundering and fraud in their attempt to assume control of the casino under the guise of an investment group called Columbia Group Inc. Other charges include witness tampering, tax evasion and illegally transporting gambling machines.

Among those indicted were reputed Pittsburgh mobsters Pasquale M. “Pat” Ferruccio and Henry “Zebo” Zottola, Dominic Strollo of Youngstown, Ohio, and John “Duffy” Conley, a mob associate now in federal prison on a Pittsburgh gambling conviction.

Also indicted was former Rincon Tribal Council member Ruth Calac. She allegedly accepted the use of a leased automobile from Ferruccio, described in the indictment as a friend, in exchange for helping the group get control of the casino and hide its true identity.

The indictments, unsealed in Pittsburgh and San Diego and containing 50 separate charges, mark the second time that organized crime figures have allegedly sought to muscle in on the Rincon River Oaks Casino in Valley Center, 35 miles northeast of San Diego.

Ten people linked to the Chicago mob--including crime boss John “No Nose” DiFronzo and San Diego mobster Chris Petti--were indicted in 1992 and convicted in 1993 for racketeering and extortion in trying to gain control of the Rincon operation. The casino had closed in 1987 amid the federal probe of organized crime involvement.

In the 1992 case, Calac was instrumental in thwarting attempts by organized crime figures to use her cousin as a front and to offer bribes. When the 10 were sentenced, she spoke with passionate indignation about organized crime trying to corrupt Indian gambling.

Assistant U.S. Atty. Mitchell Dembin said it is unclear why Calac stood against the Chicago mob but allegedly assisted the Pittsburgh mob. He suggested that one explanation was that she had a previous link to Ferruccio but none to the Chicago figures.

In April 1995, with capital supplied by Columbia Group, the 20,000-square-foot Rincon casino reopened with a flourish, offering patrons 400 video poker slot machines like those featured at parlors in San Diego County run by the Sycuan, Barona and Viejas tribes. Nevada-style slot machines are seen as the key to making Indian gambling profitable.

The Barona casino east of San Diego, for example, grosses more than $60 million a year. It has become a major benefactor of local charities and employs singer Kenny Rogers as its spokesman.

In documents filed when it reopened its casino in 1995, Rincon tribal officials estimated that it would gross $12 million a year.

But U.S. Atty. Alan Bersin took legal action in mid-1995 to have the video slot machines at Rincon removed because he said their presence violated a voluntary moratorium on installing any new slot machines. The moratorium is to last until lawsuits against the state filed by Indian tribes frustrated by lack of state approval for gambling casinos are resolved. Those suits are now pending before the U.S. Supreme Court.

The Rincon leadership insisted that the tribe was not part of the moratorium reached between other tribes and Bersin. The tribe lost a legal fight and the machines were removed. The casino remained open with marginally profitable card games and bingo until red ink forced its closure in June 1996.

Federal investigators began probing Columbia Group almost as soon as it signed the 1994 agreement with the Rincon Tribal Council. The group represented itself as a group of lawyers and doctors looking for investments. In court papers filed to obtain an injunction against the video slot machines, the group was labeled by authorities as “suspicious.”

“This should send a message loud and clear to remnants of organized crime,” Bersin said in announcing the indictments. “There is no room for you in San Diego regardless of where you come from in the United States.”

Gov. Pete Wilson, in a written statement, said the Rincon charges are a vindication of his stand against approving additional Indian gambling parlors until the tribes accept greater state control.

Edward Arviso, president of the Rincon Tribal Council, said the tribe is saddened that one of its own allegedly betrayed the tribe. The indictment alleges that Columbia Group tried to hide its identity from the tribe, law enforcement and the National Indian Gaming Commission.

“It’s really very sad that one of our own members would dupe our tribe,” Arviso said. “Working hand in hand [with officials], we can stop this from happening again. We intend to get back into gaming with a [state] compact and in the right way.”

Two of the 17 indicted have already pleaded guilty. Six others have agreed to plead guilty, officials said.