A Federal investigation of mob-backed video poker machines is now underway in Chicago’s Bridgeport neighborhood, NBC5 and the Chicago Sun-Times have learned. And tavern owners, in whose bars the poker machines were located, have been called to testify before a federal Grand Jury.
The raids, according to law enforcement sources, began over the summer.
“They hit several taverns, ten or twelve of them maybe," confirmed attorney Joseph Lopez, who said the FBI took all the circuit boards out of the machines. That could allow authorities, according to one bar manager, to check for possible tax evasion charges.
One such raid, according to a knowledgeable source, took place at the Redwood Lounge at 3200 South Wallace. Reached at home, the bar owner, Nick Spazio, declined to comment when asked if his tavern was the object of an FBI raid. “Sweetheart, I can’t really talk to you on the advice of my laywer…we better leave it alone,” he told a reporter.
The bar is now closed.
Authorities believe the video poker machines, which produce illegal payouts, tie back to the operation of the late Joseph “Shorty” LaMantia, a top lieutenant in the 26th Street Crew, which operates in Bridgeport and Chinatown.
LaMantia in turn worked under Frank Calabrese, Sr. who was convicted in 2007 in the historic Family Secrets trial, involving 18 unsolved mob murders. Calabrese, Joseph Lombardo and three others were found guilty on racketeering, and conspiracy charges. A jury ruled that Calabrese, 72, took part in seven outfit hits and ran an illegal gambling operation. He was sentenced to life in prison.
At the end of the 2007 trial, Robert Grant, Special Agent in Charge of the Chicago FBI said his agent’s work was not done. “It’s not the end of the Outfit,” he said. “I would declare to you right now we are actively investigating the Chicago Outfit.”
Video poker machines have long been a staple of Chicago taverns and a rich source of revenue for the Chicago mob.
Currently it is the state of Illinois that is desperate for revenue. And so in July, Governor Pat Quinn signed a bill to legalize video poker as a way to fund state construction projects. But those machines won’t be up and running until late 2010.
And even then critics argue it will be a daunting, if not impossible, challenge to wire all the machines to a central location and ensure no criminal influence.
So what will the mob do when the machines become legal?
Jim Wagner, a former FBI Supervisor and past head of the Chicago Crime Commission, believes video poker remains too lucrative for the Outfit to cede its profits to the state.
There’s “too much money to be made with those machines to turn their backs on it,” Wagner said. “They have their own equipment out there and that won’t change.”
The U.S. Attorney’s office declined to comment for this story. But in 2007 the late Mitchell Mars, who successfully prosecuted the Family Secrets trial warned there would be more repercussions flowing from the original investigation: “Obviously the Outfit knows we are not just going to go away.”