During 12 years spent in prison on racketeering charges, Joseph "Skinny Joey" Merlino continued to control the Philadelphia crime family, and despite the fact that he is now living in Florida, Merlino, 50, still sits atop the organization's management chart, according to a government document filed Wednesday in U.S. District Court.
The surprising disclosures were contained in a 21-page detention memo filed by prosecutors seeking to deny bail to the two latest defendants in a racketeering case pending against Philadelphia mob leader Joseph "Uncle Joe" Ligambi and 11 others. Ligambi, 72, is described throughout the document as the "acting boss" of the Philadelphia crime family, a designation to underscore Merlino's status as the recognized leader of the organization.
It had been widely assumed that Ligambi became the boss after Merlino's conviction in 2001 and that Merlino had gone into semiretirement when he opted to relocate to Florida after his prison release last spring.
The detention memo cites secretly recorded conversations in which Merlino's status is defined as the man in charge. It includes a reference to a discussion in 2010 about a "making" — or mob initiation — ceremony and individuals proposed for membership. Ligambi is quoted as saying that Merlino will "make" the guys he wants when he comes home from prison.
The government document is based in large part on two secretly recorded conversations by a government informant who was wearing a body wire when he attended mob meetings at an unnamed New Jersey restaurant in May and October 2010.
North Jersey mobsters Joseph "Scoops" Licata, 70, and Louis "Big Lou" Fazzini, 45, attended both meetings and were recorded at length discussing their roles in the crime family. Licata and Fazzini were named as defendants in a superseding indictment unsealed last week in the pending racketeering case. The new indictment also expanded the charges against Ligambi.
The indictment charges all the defendants with racketeering conspiracy and being part of organized crime. It includes multiple counts involving gambling, loan-sharking, and extortion. Ligambi also is accused of fraud in conjunction with a no-show job at a trash company through which he and his family received more than $224,000 in Teamster union-financed medical benefits.
Prosecutors cited the meetings, the status of Licata and Fazzini as "made" members of the crime family, and the criminal records of both in arguing that they should not be freed on bail pending trial. Both posed a danger to the community and risk of flight, prosecutors argued.
Bail hearings for Licata and Fazzini are expected to take place some time next week after being postponed on Tuesday.
Ligambi and five other key defendants have been held without bail since their arrests in May 2010.
Merlino has not been charged in the pending case but reportedly is the focus on an ongoing investigation into possible violations of his parole restrictions. Merlino is prohibited from associating with any organized crime figures or known felons for the next three years while on supervised release. But sources say Merlino, who now lives in the Boca Raton area, has had frequent contact with mob members and organized crime associates, several of whom attended a birthday party for him in March.
In the pending racketeering case, Licata is described as a capo — or captain — in charge of the Philadelphia crime family's North Jersey crew. Fazzini is described as a soldier working for Licata. Both are said to be involved in gambling, loan-sharking and extortion.
While not identified in the document, the cooperator who recorded the restaurant meetings is believed to have been Nicholas "Nicky Skins" Stefanelli, a Gambino crime family soldier who committed suicide in March. Sources say Stefanelli wore a body wire for nearly two years, recording conversations with mob figures from New York, Philadelphia, North Jersey, and New England.
He reportedly killed himself by taking a drug overdose because he couldn't face the prospect of testifying against his former mob associates. He was found dead in a hotel room in North Jersey.
Ligambi and Anthony Staino, another defendant in the pending case, attended the May 19, 2010, meeting with Licata, Fazzini, and members of the Gambino crime family, according to the government memo. Topics discussed included the murder of Philadelphia mob associate John "Johnny Gongs" Casasanto in 2003; friction between the Philadelphia crime family and the Lucchese organization after the son of jailed Philadelphia mob boss Nicodemo "Little Nicky" Scarfo was formally initiated as a member of the Lucchese crime family; and problems over the lack of "quality" membership in the newer generation of the mob.
Licata also joked about how he got blood all over his shirt when Fazzini was formally initiated by Ligambi. At the making ceremony, Licata said, Fazzini's finger was pricked with a pin, but no blood was drawn. So a knife was used instead.
The "blood splashed all over ... my shirt," Licata said with a laugh as he recounted the story. "I still got the shirt at home. I saved it. I don't fit in it anymore, but I have it at home."
The memo makes reference to a second restaurant meeting on Oct. 21, 2010, attended by Licata, Fazzini and the cooperator.
During that meeting Licata and Fazzini discussed the structure of the Philadelphia mob and Licata quoted Ligambi about Merlino initiating members when he gets out of jail.
"Licata explained that Merlino is calling the shots from jail," the memo reads in part.
It also notes that Licata expressed caution about whom he might propose for membership. Licata, who has served two jail terms for racketeering convictions based on informant testimony and tapes, said he did not "want to face another criminal prosecution where his guys cooperate with law enforcement."