A.G. Schneiderman Announces Indictments Of 10 Individuals With Alleged Ties To The Lucchese Organized Crime Family For Large-Scale Illegal Loan Sharking And Bookmaking Activities

Defendants Allegedly Preyed on New Yorkers in Need of Money – Using Bookmaking Operation to Funnel Victims into Loan Sharking Operation that Saddled New Yorkers with High Weekly Usurious Loan Payments

Loan Sharking Operation Largest Ever Investigated by NY AG Office 

  Attorney General Eric T. Schneiderman announced the arrests and indictment of 10 individuals on charges stemming from the alleged operation of lucrative loan sharking and gambling activities controlled by the Lucchese Organized Crime Family.

The long-term investigation — deemed “Operation The Vig Is Up” — involved the alleged loan sharking and bookmaking activities of alleged Lucchese “made member” Dominick Capelli and alleged Lucchese “Associates” or “non-made” crew members in Westchester and the Bronx. The loan sharking operation is the largest such operation ever investigated by the New York Attorney General, with usurious interest payouts exceeding a million dollars just during the approximately one-year investigation.

“As we allege, this brazen ring of criminals preyed on New Yorkers – using a gambling operation to funnel victims into their loan sharking operation, and then saddling them with usurious loan payments,” said Attorney General Schneiderman. “My office will continue to work with our partners in law enforcement to root out organized crime and prosecute these criminals to the fullest extent of the law.”

As part of the long-term investigation, investigators utilized wiretaps, covert surveillance cameras, a car bug, undercover police officers, and hidden cameras. Additional evidence came as a result of search warrants executed at defendant Robert Wagner’s home in New Rochelle and at McKiernan’s Lawton Street Tavern in New Rochelle.

In total, investigators identified over 47 distinct loan sharking victims, many with multiple loans, who were preyed on by the defendants. Loan sharking victims were allegedly required to make weekly, high interest “vig” payments, either by directly paying individual defendants, or by dropping off cash payments at two New Rochelle businesses: McKiernan’s Lawton Street Tavern and The Glass Room, a smoke shop. Victims were allegedly charged exorbitant weekly loan rates averaging over 200 percent per year, effectively creating a high-cost debt trap for all individuals taking out such loans. 

Additionally, defendants Capelli, Wagner, and Frank McKiernan are alleged to have run an illegal bookmaking operation, utilizing the gambling website bxbets.com to generate over a half a million dollars in annual wagers.

Today, Attorney General Schneiderman charged the following ten individuals with Enterprise Corruption – with underlying crimes of Usury in the First Degree and Promoting Gambling in the First Degree:

• Dominick Capelli, 61, of New Rochelle, NY
• Robert Wagner, 59, of New Rochelle, NY
• Frank McKiernan, 53, of New Rochelle, NY
• Anthony Martino, 76, of Port Chester, NY
• Michael Wagner, 63, of Bronx, NY
• Steve Murray, 49, of Bethel, CT
• Seth Trustman, 36, of Bronx, NY
• Richard Caccavale, 59, of Yorktown Heights, NY
• Jessica Bismark, 32, of New Rochelle, NY
• Robert Wagner Jr., 33, of New Rochelle, NY

The Enterprise Corruption charge alone carries a maximum penalty of 8 1/3 to 25 years in prison.

Two related indictments were also filed in conjunction with this investigation. A separate bookmaking indictment charged Michael Lepore, 61, of New Rochelle, NY, and Vincent Tardibuono, 41, also of New Rochelle, NY, with running an online bookmaking operation via website ezplay2001.com, which generated over $1.5 million in annual wagers.

Additionally, a related narcotics-based indictment filed by the Westchester County District Attorney’s Office and prosecuted by OAG OCTF Assistant Deputy Attorney General Thomas Luzio, charged Lucien Cappello, 38, of New Rochelle, NY with Criminal Sale of a Controlled Substance in the Second Degree, a Class A-II felony, as well as six counts of Criminal Sale of a Controlled Substance in the Third Degree and seven counts of Criminal Possession of a Controlled Substance in the Third Degree. If convicted, Cappello faces ten years in state prison and five years of post-release supervision.

Attorney General Schneiderman thanks Westchester County District Attorney Anthony A. Scarpino, Jr. and his office for their assistance and support.

Westchester County District Attorney Anthony A. Scarpino, Jr. said, “This investigation and successful take down of this organized crime loan sharking operation was the culmination of a collaborative effort among the Attorney General’s Organized Crime Task Force, the New Rochelle Police, and our office. We commend the work of all involved and will continue to work together to fight organized crime here in Westchester.”

Acting New Rochelle Police Commissioner Joseph F. Schaller said, “I want to commend members of the New Rochelle Police Department’s Special Investigation’s Unit, members of the New York State Attorney General’s Office and members of the Westchester County District Attorney’s Office for their hard work and dedicated efforts in helping to root out illegal gambling and loan-sharking in the City of New Rochelle.”  

The charges against the defendants are merely accusations and the defendants are presumed innocent until and unless proven guilty in a court of law. 

The investigation was directed by OCTF Investigators John Mullen and Kyle Vitale-O’Sullivan, Supervising Investigator Bradford Miller, and Deputy Chief Investigator Christopher Vasta, under the supervision of Chief Dominick Zarrella; and New Rochelle Detective Dwayne Jones, under the supervision Lieutenant Brian Fagan.

Manhattan U.S. Attorney Announces Arrests Of Operators Of Multi-State Prostitution Ring

Operators based in Flushing conspired to transport women to multiple states for prostitution

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Angel M. Melendez, Special Agent in Charge of Immigration and Customs Enforcement’s Homeland Security Investigations in New York (“HSI”), announced today the arrest of GUI YOU WU, a/k/a “David, a/k/a “Michael,” YOUMEI CHEN, a/k/a “Ah Mei,” a/k/a “You Mei Chen,” GUIXIA WU, and HONG ZHONG, a/k/a “5023,” a/k/a “023,” stemming from a conspiracy to engage in the interstate trafficking of women, primarily Chinese nationals, for the purposes of prostitution.  GUIXIA WU was arrested in Bronxville, New York, and the other three defendants were arrested in Flushing this morning.  They will be presented today before U.S. Magistrate Judge Paul E. Davison in White Plains federal court.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, these defendants promoted and managed a multi-state prostitution business through an extensive network of operators who worked in different locations to advertise and facilitate prostitution.  These defendants then allegedly raked in millions dollars from their illegal and exploitive activities.”

FBI Assistant Director-in-Charge William F. Sweeney said:  “Prostitution is a serious and harmful offense. And, in some cases prostitution can serve as a gateway for criminals with direct connections to human trafficking, organized crime, and other illegal activities. The migratory nature of these crimes makes it critical for law enforcement entities to work together to tackle this widespread dilemma. We will continue to support our law enforcement partners who play a critical role in combating this type of criminal activity.” 

HSI Special Agent-in-Charge Angel M. Melendez said:  “For years these individuals allegedly used women as a commodity, selling them for sex and transporting the women from hotel to motel and state to state.  For those who choose trafficking of people as a profession, you will be arrested, you will be prosecuted, and you will face the consequences of your actions.”

According to the Indictment[1] unsealed today in federal court:

Between about 2013 and 2017, GUI YOU WU was the manager of a business engaged in the interstate trafficking of women, primarily Chinese nationals, for the purposes of prostitution (the “Prostitution Business”).  As part of the Prostitution Business, GUI YOU WU and others transported women for the purposes of prostitution to and from hotels and motels in multiple states, including New York, Connecticut, Delaware, Maryland, Virginia, Colorado, Missouri, and elsewhere, by means of vehicles and through the purchase of airline tickets. 

The Prostitution Business recruited customers through the placement and purchase of advertisements for escort services on classified websites such as Backpage.com.  CHEN, GUIXIA WU, and ZHONG assisted GUI YOU WU in the promotion and management of the Prostitution Business through, among other things, payment for hotels and other business expenses, placement of advertisements, coordination of travel, communication with women working as prostitutes, and the movement and receipt of proceeds from the Prostitution Business. 

GUI YOU WU also employed several individuals, including ZHONG, as telephone operators for the Prostitution Business (the “Operators”).  The Operators placed advertisements to recruit customers for the Prostitution Business and used cellphones to coordinate between the customers and the prostitutes.

GUI YOU WU, 46, of Flushing, CHEN, 51, of Flushing, GUIXIA WU, 49, of Bronxville, and ZHONG, 37, of Flushing, are each charged with one count of conspiring to violate the Mann Act and the Travel Act by conspiring to transport an individual or individuals in interstate commerce with the intent that such persons engage in prostitution, or any sexual activity for which a person can be charged with a criminal offense, and by traveling in interstate commerce or causing someone else to travel in interstate commerce or using or causing to be used the mail and facilities in interstate and foreign commerce, with the intent to promote, manage, establish, carry on, and facilitate unlawful prostitution and promotion of prostitution, which carries a statutory maximum penalty of 10 years in prison.  GUI YOU WU is also charged with violating the Mann Act by knowingly transporting an individual in interstate commerce with the intent that the individual engage in prostitution and sexual activity on or about February 25, 2016, which carries a statutory maximum penalty of 10 years in prison.

The statutory maximum potential penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge.

Any individuals who believe they have information that may be relevant to the investigation should contact the FBI at 212-384-1000 or https://tips.fbi.gov/.

Mr. Berman praised the work of the FBI and HSI and thanked the Orange County District Attorney’s Office, the Sullivan County District Attorney’s Office, and the Orange County Sheriff’s Office for their assistance with this investigation.  He added that the investigation is continuing.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Attorney General Schneiderman To Lead Multistate Lawsuit To Preserve Fair And Accurate Census

  New York Attorney General Eric T. Schneiderman announced today that he will lead a multistate lawsuit to preserve a fair and accurate Census.

Attorney General Schneiderman released the following statement:

“A fair and accurate count of all people in America is one of the federal government's most solemn constitutional obligations. The Trump Administration's reckless decision to suddenly abandon nearly 70 years of practice by demanding to know the citizenship status of each resident counted cuts to the heart of this sacred obligation – and will create an environment of fear and distrust in immigrant communities that would make impossible both an accurate Census and the fair distribution of federal tax dollars.

This move directly targets states like New York that have large, thriving immigrant populations – threatening billions of dollars in federal funding for New York as well as fair representation in Congress and the Electoral College.

My office will lead a multi-state lawsuit to protect New Yorkers, preserve a fair and accurate Census, and hold the Trump Administration accountable for violating both the 14th Amendment and the Enumeration Clause of the United States Constitution.”

Earlier this year, Attorney General Schneiderman led a coalition of Attorneys General in opposing the addition of a citizenship question to the 2020 Census.

A.G. Schneiderman Leads Coalition Of 19 AGs Opposing Trump Administration's Attempt To Give Entities A License To Discriminate In Health Care

HHS Proposed Rule Seeks to Expand Ability of Businesses and Individuals to Refuse to Provide Necessary Health Care on the Basis of Their “Religious, Moral, Ethical, or Other” Beliefs

  New York Attorney General Eric T. Schneiderman, leading a coalition of 19 Attorneys General, filed comments opposing the Trump Department of Health and Human Services’ Proposed Rule, which seeks to dramatically expand the ability of businesses and individuals to refuse to provide necessary health care on the basis of businesses' or employees’ “religious, moral, ethical, or other beliefs.” 

“At a time when many New Yorkers and Americans are struggling to access decent health care, the Trump administration is trying to put ideology before patient safety and care – under the guise of religious freedom,” said Attorney General Schneiderman. “The law is clear, providing a time-tested, established framework that balances respect for religious freedom with the rights and needs of patients, employers, and states.”

The Trump administration proposes to unlawfully expand purposefully narrow existing protections, without consideration of the consequences. For example, the rule would allow businesses, including employers, to object to providing insurance coverage for procedures they consider objectionable. The rule would also allow individual health care personnel to object to informing patients about their medical options or referring them to providers of those options. Finally, the rule would impose particularly enormous burdens on marginalized patients, including LGBT patients, who already confront discrimination in obtaining health care. 

Placing the objections of businesses and health care workers above patient safety and care violates existing federal and state laws and undermines state public health efforts to ensure access to care. Additionally, the Proposed Rule unconstitutionally seeks to coerce the States’ compliance with its unlawful requirements by threatening to terminate billions of dollars in federal health care funding if HHS determines that the States have failed—or even “threatened” to fail—to comply with the rule.  

Because HHS’s proposed rule would increase the risk of harm to patients and be inconsistent with the text of several federal and state laws and the Constitution, the Attorneys General are urging that the Proposed Rule be withdrawn. 

Click here to read the comments, which were submitted by the Attorneys General of New York, Connecticut, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, and the District of Columbia.

DOI Statement on NYPD's Response to Our Findings on NYPD's Special Victims Division - Adult Sex Crimes

The City of New York Department of Investigation 

MARK G. PETERS COMMISSIONER

  DOI’s Report on NYPD’s Special Victims Division (SVD) is evidence based. It relies on the NYPD’s own documents, which are attached to the report, as well as interviews with the most senior person in charge of SVD, Deputy Chief Michael Osgood, Commanding Officer of SVD, who has been running the unit since 2011. In addition, DOI spoke with other SVD supervisors, senior sex crimes prosecutors in all five District Attorney’s offices, numerous recent retirees of SVD and all major victim advocates in New York City. Furthermore, we shared the report with and requested comment from Commissioner O’Neill nearly two weeks ago.

 NYPD’s statement inaccurately notes two numbers: 

1: In 2017, the average caseload of an SVD investigator was 77 (not 62). The 77 number is based on NYPD’s own documentation. (Homicide detectives average two cases per year). 

2: The number of detectives assigned to actively investigate adult sex crimes is 67 (not 85) and the NYPD did not dispute that number last Friday when we discussed the report with NYPD officials. (NYPD has a total of 3,000 detectives).

  The report does not dispute the survivor-centered model or FETI. In fact, we commend these initiatives in our report. 

 DOI’s report demonstrates this: more needs to be done to properly respond to victims of adult sex crimes. The NYPD’s refusal to recognize this presents additional barriers to sex crimes victims in their pursuit of justice.

CONGRESSMAN ADRIANO ESPAILLAT CALLS FOUL ON U.S. CENSUS BUREAU’S DECISION TO ADD CITIZENSHIP QUESTION TO 2020 CENSUS

 Representative Adriano Espaillat (NY-13) released the following statement regarding the U.S. Census Bureau’s decision to add a question regarding citizenship to the 2020 Census.

“I am deeply concerned following the decision by the Trump Administration and U.S. Census Bureau to add a new citizenship question to the 2020 Census. By doing so, at the request of the Department of Justice and without proper review, this undermines the accuracy and reliability of the 2020 Census.

“I call on the Chairman of the House Oversight and Government Reform Committee to formally object to the inclusion of this outdated and hazardous question. Including a citizenship question on the full Census, an action last done in the 1950s, will drive people underground. Asking respondents their citizenship status is unnecessary and harms the reliability and accuracy of the Census by drastically reducing the response rate, particularly among the already undercounted minority and immigrant communities. In an effort to conduct a fair and accurate Census, we must ensure the questions are appropriate and meaningful.

“The Constitutionally-mandated Decennial Census is one of the most consequential responsibilities of our federal government. The Census is the backbone of a fair and fully representative government, utilized to determine how funding and resources are allocated to Congressional districts around the nation.

“The Census is how our voices are counted, and the decision to add a new citizenship question creates fear, intimidation and removes the voices of millions of individuals from representation from the federal government. I promise to continue fighting to ensure that my constituents are counted and the diversity and inclusion within our communities are represented fairly, accurately and without interference by the divisive Trump Administration and hate based proposals being put forth.”

In a letter to the U.S. Census Bureau, Congressman Espaillat expressed early concerns regarding the 2020 Census and called for accurate reporting.

MAYOR DE BLASIO, NYC BUSINESS & LABOR LEADERS DENOUNCE TRUMP PUSH TO ADD CITIZENSHIP QUESTION TO 2020 CENSUS

  Mayor Bill de Blasio and the Association for a Better New York today warned that the decision by the Trump administration to add a citizenship question, asking every family in America about their immigration status, to the 2020 Census will have a serious, negative impact on New York City.  The question is likely to depress response rates among immigrant communities and result in an inaccurate count that will hurt New York State’s representation and federal funding, and, fundamentally, our American democracy.

"New York City is joining Attorney General Schneiderman’s lawsuit to stop President Trump from this unprecedented move to politicize the census. A fair and accurate 2020 count is constitutionally mandated to ensure political power and resources remain with the people – where they belong. President Trump’s decision puts our amazing city of immigrants in jeopardy and threatens federal funding for infrastructure, health care and public safety in New York,” said Mayor de Blasio. 

“The citizenship question undermines an accurate census for all America. It stokes fear, increases the likelihood of a false count, and unfairly harms cities and states like New York where immigrants are a deep and important part of the fabric,” said Steven Rubenstein, Chairman of the Association for a Better New York. “We urge Secretary Ross to reconsider this damaging decision that will further discourage these already hard to count populations from participating.”

With a population of 8.6 million people, New York City is the most populous and ethnically diverse city in the United States. Two hundred languages are spoken in the five boroughs and more than 3 million of the city’s residents were born in other countries. New York has the largest Latino, Caribbean, Asian, and African populations of any American City. Our diversity is a hallmark of our strength.

The addition of a citizenship question to the short-form Census for the first time since 1950 could reduce participation in the Census from all immigrants, regardless of their immigration status.

Before the administration decided to add this politically-charged question in to the decennial count, the challenges faced by the 2020 Census were already enormous. That is due to highly charged anti-immigrant rhetoric coming out of Trump administration and internet security breaches which have dominated the headlines.

The decennial census count determines representation in the U.S. House of Representatives, is used to draw political district at federal, state, and local levels, and affects the flow of billions of dollars in federal funds to the State and City. An inaccurate count is also bad for business, as many companies use census data to locate stores and allocate resources.

The flow of dollars to New York State and, by extension New York City, from the federal government is also affected by the census count. An undercount shortchanges the city, hurting its ability to provide affordable housing, maintain infrastructure, and provide for the needs of residents in the areas of education and health, especially related to the well-being of children. These are services that residents of all creeds, nationalities, and economic class use on a daily basis.

The decision to include a question about a family’s immigration status is a bipartisan issue. It will hurt all immigrant-heavy states, including Florida, California, Texas and Arizona. Earlier this year, the United States Conference of Mayors, with more than 160 mayors across the political spectrum issued a letter calling on Commerce Secretary Wilbur Ross to reject a push to include a citizenship question in the 2020 Census. Civil rights advocates have also raised alarms over the question.

The Census Bureau is bound by Title 13 of the United States Code, which means personal information provided for the Census cannot be published, shared or even given to any other government agency. Despite that, the City and ABNY remain highly concerned that the citizenship question will depress participation in the 2020 Census and so do immense harm the City, the State and Country.

The removal of this question is necessary to protect an accurate count and a correct reapportionment of federal representation and dollars to New York and other affected states throughout the nation. The City will continue its advocacy against deleterious changes, including a citizenship question, to the 2020 Census.

“The Trump Administration’s claim that adding a citizenship question to the census will protect voting rights is preposterous and hardly conceals their true intent. This is plain and simple another attack on immigrant communities,” said Bitta Mostofi, Acting Commissioner of the Mayor’s Office of Immigrant Affairs. “As federal administrations have acknowledged for the better part of a century, an accurate count of every person ensures an equitable distribution of resources for critical services, like housing and health care. We will continue to fight changes like these that aim to distort our democracy and enflame fears among immigrant New Yorkers.”