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First of all Wiretappers, don’t forget to buy me a cup of coffee on Venmo at ganglandwire. Today we must thank our frequent guest host and mafia researcher screenwriter Camulius “Cam” Robinson. In this episode Cam goes deep into the Chicago Outfit’s influence over the Northwest Indiana organized crime rackets. In the Indian state line city of Chicago Heights, IL over 50% of the population was Italian while Indiana did not have the large Italian population. Despite its rural image Indiana organized crime was a real thing.
Lake County, IN
- Fell under Chicago Heights crew of Chicago Outfit
- Anthony Pinelli: early boss of NWI under Capone after Chicago consolidation, later retired to California and LA Family
- Frank LaPorte boss of Chicago Heights (famous photo with Capone sitting on lawn), boss of whole crew (IL/IN) until 1972
- Al Pilotto 1972-1982 indictment
- Al Tocco/Dominick Palermo 1982-1990
- Indiana capos:
- Gaetano “Tommy” Morgano: deported to Sicily 1963 after a gambling conviction rather than go to prison
- Frank Zizzo (ran operations 1963-1988): owner of Pepper Pot Pizza in Gary and Highland—NOT Santini’s Pepper Pot in Portage or Valparaiso (no lawsuits)
- Bernard “Snooky” Morgano (b. 1936): son of Tommy, indicted in 1990, released in 1996
- Snooky Morgano’s organization:
- Anthony Leone (b. 1939) : nephew of Morgano and lieutenant,;ran street tax and gambling rackets in the area; lived in a “huge house” in Valparaiso; went into Witness Protection after testifying in syndicate trail in NWI in 1989; but left voluntarily in 1991 to return to the area and spend the holidays with his sons; he was active in the Special Olympics; and died March 13, 2019
- Peter “Cadillac Pete” Petros (b 1935): street tax collector for Leone
- Sam “Frog” Glorioso (b 1942): street tax collector and soldier, he was a steel worker
- Sam Nuzzo (Merrillville): 80% of illegal gambling in Lake County
- Efrain “Puerto Rican Frankie” Santos: ran bolita in East Chicago, partner in operation with Ken Eto, controlled Latino crime in the area, Chicago came to appreciate Santos more than Morgano
- James A. “Sonny” Peterson (East Chicago): controls policy rackets in predominantly black neighborhoods, involved in scam with County Commissioner to sell nursing home to County at elevated price
- Anthony Leone (b. 1939) : nephew of Morgano and lieutenant,;ran street tax and gambling rackets in the area; lived in a “huge house” in Valparaiso; went into Witness Protection after testifying in syndicate trail in NWI in 1989; but left voluntarily in 1991 to return to the area and spend the holidays with his sons; he was active in the Special Olympics; and died March 13, 2019
Funny Indiana Organized Crime:
Al Roy Watkins: lottery operator turned federal witness, reported to Anthony Leone
- 1983—Anthony Leone and Al Roy Watkins both laid off as foremen at Gary Works of US Steel, so they started a lottery with &10,000 loan from Bernard “Snooky” Morgano
- $600-$700 per day in the beginning, $3000 later per day, every day, except Christmas—that’s a holy day
- Same numbers as Illinois Lottery Pick-Four, and they drove to Illinois and use that state lottery to “lay-off” number combinations that would break the bank
- 55% of every dollar to costs (15% to mob, 10% to cops, 30% to lottery winnings), 45% to Leone and Watkins
- Leone was said to carry a gun and lived in a “very huge house” in Valparaiso, IN
- Leone sold the lottery for $10,000 to a new lottery group, and gave Watkins nothing, but assured he could go with the sale and continue running it…basically throwing Watkins in. Watkins later said, “He sold me like a slave.
Poor Vincent “Pee Wee” Lozado: gambling operator in Merrillville, IN, caught talking to under-cover Gary police officer
- Paid 10% street tax to Morgano through Leone—also had to pay 15% to Santos, because“all Latins involved in illegal activity paid street tax to Puerto Rican Frankie”
- Leone owed Lozado $10,000, so Lozado left and worked only for Santos
- Christmas 1985, Leone took Lozado’s business back and demanded 10% plus $1,000 a month street tax, plus the 15% he was forced to pay Santos. Lozado couldn’t complain to anyone, because they were all connected to the Outfit, so he told undercover officers he was only making book to continue paying the street tax he owed. In 1990, he was indicted and went to prison for 3 years.
Frank Zizzo pay shake-up—Indiana organized crime leader Anthony Leone starts to lose faith
Frank Zizzo the previous boss of NWI died in 1986. He paid his people well. When he died, his counter-parts in Illinois did not.
- Anthony Leone stated that he was paid $1000 per month for collecting street tax from Snooky Morgano until Zizzo died
- Leone questioned his uncle Morgano about pay going forward, “He said he didn’t know if either one of us was going to have a job.” His pay eventually fell to $300 a month from “people across the state line”
- The Chicago/NWI dynamic is somewhat similar to the New York/North Jersey dynamic
NWI Construction Racket
1989 Al Tocco is imprisoned based on testimony his wife gives. Dominick “Tootsie” Palermo takes over Chicago Heights.
- Tootsie Palermo is capo/boss, Nick “Jumbo” Guzzino is capo of Illinois rackets, Snooky Morgano runs Indiana
- Historically, the crew has dealt in gambling and unions, but they bagan to dabble in construction
- Palermo and Guzzino were heads of the Laborers International Union of North America
- Guzzino collected $2.3 million from contractors in the 1980s for Welfare and Pension Fund, but the office wasn’t set up for cash, so they took him at his word.
- Tootsie Palermo collected cash membership dues, for which he was paid $1000 weekly
Snooky Morgano controlled gambling and construction rackets in NWI through his nephew Anthony Leone
- Major arrests in 1990 of all major gambling and union figures in NWI based on multiple witnesses
- Anthony Leone agreed to testify against his uncle Snooky Morgano and Dominick Tootsie Palermo and Nick Guzzino
- Leone had handled business after Morgano had a heart attack in 1986
- FBI contacted previous owners of pizzeria where Palermo and Guzzino met, owners wife called and notified mobsters
- “Jan called yesterday…the G was checking who owned the joint 1992: Dominick Palermo (74) sentenced to 32 years, 3 months for extorting protection money from bookmakers in NWI, and fined $250,000
- Nick Guzzino (50) sentenced to 39 years, 6 months and fined $185,000
- Bernard Morgano (55) sentenced to 16 years, 3 months, $177,000 fine
- Morgano said of his nephew “He is a snake, he lied on that stand. I do not ask for mercy, I ask for justice.”
- Guilty of using threats of bodily harm and arson to collect thousands in street tax—11 victims testified
There were several tapes discussing extortion “we are going to have to check it out with Chicago first”
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Hey Gary,
I love your podcasts and was listening to the episode involving the Bonny and Clyde motorcycle tour. I am a student of the 1930s motor bandits.
I believe that B & C were probably in a lower league than the true professional outlaws of that era, including John Dillinger, Charles Arthur “Pretty Boy” Floyd and my favorite, the Barker-Karpis Gang. I highly recommend the “The Alvin Karpis Story.” Karpis was highly intelligent, a great story teller with a wry sense of humor. He debunked the notion that Ma Barker was the leader of the gang, (“Ma couldn’t plan breakfast,”) and recounts a meeting with Bonny and Clyde, when the pair tried to sell him several Browning Automatic Rifles. Karpis referred to the pair contemptuously as “Texas screwballs.”
Thank you Jim and I agree that Bonnie and Clyde were the minor league robbing gas stations and vending machines. They did know their weapons using the BAR and they did kill some police officers but that also demonstrates their lack of sophistication.
The person that rented his Garage to Al Capone in Bruce Lake, Indiana and was Loyd Overmeyer.
Thanks for filling us in on that!
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Very interesting, would love to know more
Thank you for your comment. I will ask Cam about what more we can learn. He is the expert on that area.
We rented a farm off of stagecoach road in the 1970 apparently owned by a African american man who was in the Gary mob. So the story goes he was found dead in Gary and we stopped renting the farm. Can’t remember what his name was but would love to know the history of him and that farm.
Thank you for your interest. We will look into that.
I was wondering if Elkhart Indiana had organized crime i keep hearing about Tony i think or Nick one of the two “the greek ” supposely he ran Elkhart back in the days the fly trap, iara ,micheals , crimaldis n few other places or restaurants but can You tell me history on the mob in Elkhart Indiana please and thank you
Darius, We have never found any primary source documents or other information about Mafia activity in Elkhart. I believe they did have a small immigrant neighborhood with many inhabitants from Italy back in the 20s-30s. But to our knowledge, there were no reported connections to other mobsters.
Ok so the Italian guy who died recently in Elkhart frank lucheese is he related at all to the lucheese crime family out of new York?
Not to my knowledge.
The mob was around. My grandfather owned the lincoln inn which ironically became my uncle Frank’s on my mom’s minellis steak house across from Michael’s on Harrison St. They were bootleggers. I misplaced the picture with al capone at the bar. I was young but met nick the Greek. My dad owned uncle Joe’s speedway in Elkhart. My uncle joe Barone shot Mike Montagano in front of the iara club. Both of my parents lived on Harrison St moved to calif. In the 50s. Around 65 or 66 I met Mickey Cohen his brother lived above us
Thanks for your stories, they are great.
Is frank lucheese of elkhart indiana is he apart of the mafia and what’s info on organized crime in elkhart indiana?
What was the relationship of the Pastrick Machine on the political side with the NWI mob? They must have worked together. Also, who was the liaison for the Mexican community in East Chicago and Gary? It is clear there was a liaison with the Puerto Rican community.
My great Uncle was Tony Leone. So crazy. It was my first Easter when he was sentenced!! So crazy reading up on him as I have been around him sometimes in my life. He would take my mom to Snookis pizza alot when she was younger.
Fantastic stuff. It just shows that people love gambling. There’s just too much money too be made to pass it up. Question for you Gary, As far as you know is there still a street numbers lottery going on in Kansas City today? Im dam sure there’s bookmaking going on. Not the online kind of bookmaking.
I have not heard of the street numbers game for a long time. I agree; we still have a sports book to some extent. The new app has probably made it hard. But the app does not give credit, so we will always have the independent bookie.
I still see Puerto Rican Frankie from time to time in East Chicago. He is doing well and has many friends.
Hey I live just about 2 miles from Bruce Lake, Indiana. Al Capone used to come here and hang out. There’s a guy here who bought what used to be an old shop & gas station. It was pretty run down, he put a lot of money into it. He also has pictures of AL Capone visiting and also some hand written stories of people who met him. He seemed well liked, lol. He also had a hideout house not too far away, closer to Culver, Indiana. On Kings Lake. We’ve tried to drive by it and get a good look, but the owners have a grass hill thing out front to block the view. Or they used to, at least. It has been many years since I’ve been.
Thanks for your memories Jessica. Al Capone was more than a simple gangster to most people during his time.