THE MOB’S GHOST WORKERS AND OVERBILLING
Cleanup scams reigned
- KEY PLAYER -
IN SEPTEMBER 2003, John Micali was on the payroll of a contractor hired to remove asbestos from Ground Zero artifacts — the crushed fire trucks, the trashed furniture, the twisted steel.
Micali was listed as a $58,000-a-year
major decontamination job, according to employee of Specialty Service Contracting,
a four-month Daily News investigation paid by the Port Authority to clean
into the $21.4 billion 9/11 federal disaster World Trade Center artifacts at JFK’s recovery aid package. Hangar 17.
There was one serious problem with this arrangement — John Micali was actually in a federal prison cell in Brooklyn
Investigators say the scam was the height of post-9/11 gangster chutzpah.
At 6 a.m. on Sept. 17, 2003, the FBI busted Micali as part of a gang that burglarized banks, identifying him as a mob associate who planned to marry the daughter of Louis (Louie Bagels) Daidone, acting boss of the Luchese crime family.
Micali — who sports a tattoo on his back that reads “Kill all the police with a shot in the head” — once used a hammer to beat a man who owed the gang money, prosecutors charged.
While those details were sufficient to persuade a judge to keep Micali behind bars, they were not enough to get the PA to stop paying for his “work” at Hangar 17.
Sources said that while behind bars, he remained on the payroll for weeks.
Micali’s magical ability to be in two places at once is illustrative of how the mob operated behind the scenes after the 9/11 terrorist attacks.
Micali was not alone. Investigators discovered that another Specialty worker had apparently found a way to be in three places at once.
The worker was listed on payroll records as working the same shift on the same days from Sept. 16-24, 2001, at three different job sites around Ground Zero.
That discovery inspired investigators to closely monitor Specialty’s other work at the Hangar 17 job.
Besides the ghost-employee scam, the mob relied on a catalog of schemes to rip off 9/11 funds from taxpayers: price gouging, falsified record keeping, overbilling and the use of tainted asbestos samples to keep the clock running on a
Prosecutors say the man at the center of many of these scams was Allen Monchik, a twice-convicted felon who specialized in credit card fraud.
Working in a wide-ranging probe under Manhattan District Attorney Robert Morgenthau, investigators say Monchik held a secret interest in Specialty Service
Contracting.
At Hangar 17, the $3 million
artifacts cleanup was overseen
by PA engineer Tony Fontanetta, a longtime Monchik friend
who, authorities charged, regularly accepted Mets tickets,
cash and other bribes.
It is inside Hangar 17, investigators say, that the “presence” of ghost employees was
most profound.
On March 4, 2003, an intercepted conversation between Monchik and Fontanetta laid out how the alleged worked.
Monchik said he had four asbestos handlers on the payroll at the hangar.
Fontanetta: “Well, you know what you
do? Make yours five, okay?
Put your number in, it’ll
come in a little higher than
our numbers, but you can
say you anticipated five because of the unknown.”
Fontanetta said he’d possibly be getting more work
for Monchik “down at the
World Trade,” then added,
“I appreciate your consideration, eh, Al?”
“Ten-four,” Monchik replied.
Six days later, Monchik and another corrupt PA employee, Mark Jakubek, discussed explanations for a nonexistent security worker at Hangar 17.
Monchik: “I’ll call it ‘a guy on standby,’ one person.”
Jakubek: “I could say, you know, looking over your own equipment, making sure your equipment is safe. That kind of thing . . . I think I would be able to work with that.”
Monchik: “I mean, it sounds like a good song and dance here.” The men shared a laugh.
In yet another intercepted conversation, on March 19, 2003, Fontanetta told Monchik, “What we’re gonna do is we’re gonna make an entry on the T&M [time & materials] sheet, so there will be an indication that he was there.”
Monchik: “I mean, it’s all coming out of the Port’s money one way or the other, so why shouldn’t it just look the same for the day and tell him don’t bring the guy in?”
Based on the recorded conversations and other evidence, Morgenthau’s office and the PA inspector general believe taxpayers were charged for materials never used, and that Specialty tried to charge for extras like an American flag and cameras at Hangar 17 and billed non9/11 work to the hangar job.
Two other schemes involved asbestos removal in the Ground Zero area, according to documents obtained by The News.
Specialty was hired with FEMA funds to remove the substance from 90 West St., an office building heavily damaged in the attacks that was to be turned into luxury condos.
Even before they started the job, Monchik and his partner, Gerard Dennis, planned on billing for costs above what they bid.
As Dennis put it, “We’re gonna bang the s--- out of these guys on extras.”
On May 9, 2003, Monchik was overheard on the phone discussing how to “rip and skip” at 90 West St.
In essence, Specialty would remove asbestos-covered pipes while skipping the usual — and costly — rules for safe abatement.
Prosecutors say Specialty did this by
deliberately beginning the West St. job a week before it told the city, enabling them to avoid scrutiny.
It also allowed them to bill for more pipe than they were actually ripping out of the building.
“So, let’s say they say 6 feet of pipe,” Monchik was overheard telling a subordinate. “You write up ‘10 feet.’ You know
Also, investigators watched as Specialty workers loaded trucks at the 90 West St. job with bags of asbestos, then drove out to Long Island to dump the materials illegally, according to a written report about the probe.
By the spring of 2003, prosecutors allege, another mob family representative was on the Ground Zero scene: Gambino associate Noel Modica, who was heard resolving a money dispute for yet another subcontractor, Termon Construction of Brooklyn, documents show.
Termon, which has not been charged with wrongdoing, was paid $2.2 million to wipe down Trade Center dust from apartments in Battery Park City.
Monchik and Modica worked out a deal that May where Termon would “borrow” back some of the money it owed to Specialty — a way to cover up a passthrough payment, according to investigators’ reports.
A Gambino informant, Michael DiLeonardo, has described Modica as a mob messenger boy who helped the underworld hide machine guns and conducted surveillance at a hotel where jurors were staying during the 1992 trial of the late mob boss John Gotti.
- TAINTED SAMPLES -
In the fall of 2003, prosecutors say, the 9/11 cleanup corruption reached a new low.
Robert Leary, a PA employee monitoring Specialty’s payroll at Hangar 17, had quite an incentive to keep the contract going; Prosecutors charge he’d been regularly receiving $50 cash for each ghost employee he certified.
The only problem was that tests of the Trade Center artifacts were starting to come back negative for asbestos.
Leary allegedly acquired an asbestosfilled sample from a Specialty cleanup job at JFK’s Delta Terminal and placed it in with the Hangar 17 samples.
Leary was arrested May 12, 2004, and charged with tampering with public records and falsifying business records.
In December 2004, 23 others were charged with defrauding the PA and other governmental agencies on several asbestos-removal jobs, including the 9/11 work at Hangar 17.
Those charged included Fontanetta, Jakubek and two other P A workers, along with Specialty and two additional asbestos firms. The cases are pending; Monchik is now cooperating with authorities.
Fred Hafetz, attorney for Specialty, noted the company has asked a judge to dismiss the case. He declined further comment.