PRIVILEGED & CONFIDENTIAL To: Mr. Ronald Carey, IBT General President From: Members of the Independent Review Board Subject: Proposed Charges Against Local 807 Member John Charles Zancocchio Date: March 23, 1994 I. RECOMMENDATION The IRB respectfully recommends to the General President that he initiate charges against John Zancocchio for being a member of organized crime and for failing to cooperate with the IRB. II. INTRODUCTION An investigation has been conducted into allegations of the organized crime ties of John Charles Zancocchio ("Zancocchio"), a member of IBT Local 807 located in Long Island City, New York. Zancocchio has been a member of Local 807 since January 1, 1988 when he transferred from Local 814. (Exhibits 1 and 2)1 Based upon investigation, it appears that while an IBT member Zancocchio violated Article II, Section 2(a) and Article XIX, Section 7(b)(1) and (2) of the IBT Constitution by being a member of the Bonanno Family of La Cosa Nostra ("LCN"). 1 Local 814 records reflected that Zancocchio was a member of Local 814 from April 28, 1987 until he transferred into Local 807. (Exhibits 2 and 14) 1 A. Summary On January 1, 1988, John Zancocchio was initiated into Local 807. (Exhibit 1) In April 1990, Zancocchio and his father-in-law, Anthony Graziano, were charged with federal tax offenses. (Exhibits 3 & 4) On April 12, 1990, Zancocchio pled guilty to the failure to file a tax return, in the United States District Court, the Eastern District of New York (CR 90-33 3/334), before USDC Judge Eugene H. Nickerson. (Exhibit 4) For purpose of sentencing, the government contended Zancocchio was a member of organized crime. Zancocchio disputed the allegation. On November 2 and November 23, 1990 a sentencing hearing was held. (Exhibits 5 and 6)2 At the November 2, 1990 hearing, New York City Police Department Detective Joseph Rauchet ("RauchetM) testified that Dominick Farace ("Farace"), a cooperating witness in the Federal Witness Protection Program, advised that he met with Anthony Graziano and Zancocchio at a Staten Island bar, the Crossroads. (Exhibit 5 at 23-24) According to Rauchet, Farace stated that Graziano and Zancocchio owned this bar and would physically search individuals who wanted to speak to Graziano at the bar. (Exhibit 5 at 24) Rauchet testified that Farace told him that during his meetings with Graziano and Zancocchio, the three 2 Such sentencing hearings are known as Fatico hearings. See. United States v. Fatico. 579 F. 2d 707 (2d Cir. 1978), on remand. 458 F. Supp. 388 (E.D.N.Y. 1978), aff'd. 603 F. 2d 1053 (2d Cir. 1979), cert, denied. 444 U.S. 1073 (1980). 2 discussed criminal activities. (Exhibit 5 at 23)3 Detective Rauchet also testified that Farace advised him that Zancocchio became a member of the Bonanno LCN Family in late 1987 and that Graziano was a Bonanno LCN Family Capo. (Exhibit 5 at 24) Federal Bureau of Investigation Special Agent Gary Draus ("Draus") also testified at the Fatico hearing concerning Zancocchio and Graziano. (Exhibit 5 at 97-105) Draus testified that for more than six years he has been assigned to the New York FBI sguad that focuses on the Bonanno LCN Family. (Exhibit 5 at 97) Draus testified that LCN member sources in various New York LCN families have advised the FBI that Zancocchio was a made member of the Bonanno LCN Family and Graziano was a Bonanno LCN Capo. (Exhibit 5 at 99-100) At the conclusion of the hearing, the Court found as to Zancocchio: "Yes, I'm going to find he is a made member." (Exhibit 6 at 65) With respect to Zancocchio, the Court also stated: "But I'll find that he's a member of organized crime ..." (Exhibit 6 at 66) The Court also found Zancocchio's co-defendant, Graziano, to be a "Cappo [sic] in the Bonanno Family and that he headed a crew and got a portion of the proceeds [of] whatever they did." (Exhibit 6 at 44) At the conclusion of the Fatico hearing, Zancocchio was sentenced to six months incarceration and a $25,000 fine. (Exhibit 6 at 70-71; Exhibit 4) 3 According to Rauchet, Farace advised him that these criminal activities involved hijacking truckloads of fish from the Fulton Fish Market. (Exhibit 5 at 19) 3 B. Jurisdiction The IRB has exercised its authority pursuant to Article XIX, Section 14(c)(1) of the IBT Constitution, to designate this disciplinary matter to be within the original jurisdiction of the IBT General Executive Board. C. Collateral Estoppel Zancocchio should be precluded by operation of the doctrine of collateral estoppel from re-litigating the same issues previously adversely decided in a separate action in which he fully participated and had every reason to contest. The standard of proof applicable to Zancocchio's sentencing hearing was whether the government had proved the allegations against Zancocchio, including his organized crime membership, by a preponderance of evidence. (See, Exhibit 6 at 44; Exhibit 16 at 3) This is the same standard of proof applicable to internal union disciplinary charges. Article XIX, Section 1(e) of the IBT Constitution. The doctrine of collateral estoppel has been considered and sustained in prior matters under the Consent Order. See United States v. IBT fFriedman and Hughes] f 725 F. Supp. 162, 167 (S.D.N.Y. 1989), aff'd. 905 F.2d 610 (2d Cir. 1990). In that case, the District Court and the Court of Appeals upheld the finding of the Independent Administrator that the respondents "should be collaterally estopped from contesting the substance of the charges against them, since the charges are essentially the same as those previously decided in their criminal trials." 725 F. Supp. at 167. 4 The finding, after a contested hearing, that Zancocchio was a member of the Bonanno organized crime family should be binding on him. III. INVESTIGATIVE FINDINGS A. Zancocchio's Organized Crime Membership On January 1, 1988 Zancocchio became a member of IBT Local 807. (Exhibit 1) Since his transfer to Local 807 from IBT Local 814, Zancocchio has worked at the Jacob Javits Convention Center. (Exhibit 1) The Federal Bureau of Investigation considers Zancocchio to be a member of the Bonanno LCN Family since in or about 1987. (Exhibit 13) Zancocchio is the son-in-law of Anthony Graziano ("Graziano").4 The FBI considers Zancocchio's father-in-law, Graziano, to be a Capo and a member of the Bonanno Family. (Exhibit 13) Local 814 records reflected that Zancocchio was initiated as a Local 814 member on April 28, 1987. (Exhibit 14) Zancocchio acknowledged that he had been a member of Local 814. (Exhibit 12 at 13) In August 1987, a federal civil RICO case was filed against the Bonanno LCN Family and IBT Local 814 alleging that the Bonanno LCN Family controlled Local 814. (Exhibits 7 and 17) Several members of the Bonanno LCN hierarchy, including Zancocchio's father-in-law, Anthony Graziano, were defendants in this suit. 4 Zancocchio married Anthony Graziano's daughter in or about 1984. (Exhibit 12 at 43) 5 (Exhibit 7) As a result of this suit, in October 1987, a Trusteeship was imposed upon Local 814. (Exhibits 8 and 17) As a result of the lawsuit and the resulting Trusteeship, several Local 814 members transferred into Local 807. (Exhibit 2; Exhibit 12 at 15-16) Zancocchio was one of those who transferred. (Exhibit 2) In 1989, while a member of Local 807, Zancocchio was indicted in Richmond County, New York [on] sixteen counts of promoting gambling in the first degree. (Exhibit 15; Exhibit 12 at 45-46) On or about March 20, 1990, Zancocchio pled guilty to a felony charge of promoting gambling and was sentenced to five years probation. (Exhibit 18) In 1991, Zancocchio and ten others were indicted by a grand jury in Richmond County (Staten Island), N.Y. for participating in Criminal Enterprise Corruption. (Exhibit 9) The indictment charged that Zancocchio, who is identified in the indictment as a Bonanno LCN Family soldier, and Ciro Barone headed a group which engaged in loansharking, gambling and obtaining property (monies) by fraud violations. (Exhibit 9) The latter charge concerned Zancocchio's involvement in a telephone scam wherein victims were contacted by members of the criminal group representing themselves as Teamster members. (Exhibit 9) They solicited ads from victims for a fictitious "Teamster News" or "Teamster Union News." (Exhibit 9) This indictment is pending. During 1988 hearings before the Permanent Subcommittee on Investigations of the Senate Committee on Government Affairs ("PSI"), an exhibit was introduced which identified Zancocchio as 6 a member of the Bonanno LCN Family. (Exhibit 10 at 776) Anthony Graziano was also identified as a member of the Bonanno Family in this exhibit. (Exhibit 10 at 747, 774)5 The FBI's expert opinion that Zancocchio is a member of the Bonanno Family was corroborated by surveillances of Zancocchio at locations known to be frequented by Bonanno LCN Family members. On several occasions while he was an IBT member, Zancocchio was present at such locations. For example, on September 6, 1990, Zancocchio was observed by the FBI outside a Bonanno LCN Family club at 69-64 Grand Avenue in Queens, New York. At this time, Zancocchio was in the presence of other Bonanno LCN Family members. On September 12, 1991, Zancocchio and twenty other known Bonanno LCN Family members were observed entering the Grand Avenue social club. On December 28, 1989, a 1984 Audi with N.J. plates FHK 35L, which is registered to John Zancocchio, was seen parked at 88-64 Myrtle Avenue in Queens, New York.