Posted on April 2, 2015 by dexterbabin
The FBI’s UNIRAC (short for Union Racketeering) investigation of the 1970s exposed the Mafia’s control over waterfront commerce on the east coast. The International Longshoreman Union (ILA) was penetrated by both the Gambino and Genovese crime families. Anthony Scotto, a Gambino crime family capo, was one of the most powerful union leaders in the ILA. Though the Mafia’s control over the ILA seemed cemented, Scotto, along with Genovese mobster Michael Clemente and 33 union officials, would be indicted. By the time UNIRAC would end, 110 others along the eastern seaboard would be convicted (1).
But one mobster would escape conviction: Carlos Marcello.
While being questioned during the UNIRAC investigation in Miami, Florida, a Federal Grand Jury was convinced that New Orleans Mafia boss Carlos Marcello committed perjury. Over what exactly cannot be determined, for all of that information is redacted in released FBI documents (2). A part of the UNIRAC investigation would splinter off, tasked with gathering enough evidence to charge Marcello with perjury. The FBI was trying to prove a link between Marcello, a mysterious Mr. X ( cliché, I know), whose name is redacted in the FBI documents, and Gulf Coast Fabricators (GCF), Inc., a container service corporation (3). Through investigating the bank accounts of the three parties, the FBI would be able to prove a cash flow from GCF, to Mr. X, and then to Marcello (4). This was not good for Marcello. The FBI was able to confirm he was a silent partner in GCF, and that the company was guilty of double billing, or overcharging on repair work. What started as a simple perjury charge, would quickly evolve into an attempted RICO indictment (6).
Along with uncovering Marcello as a silent partner in the company, bank documents revealed that Marcello was responsible for a $400,000 loan for the company, and held interest in the B&M manufacturing plant in Schriever, LA (7). In 1974, Crawford Industries had a cash flow problem, due to the national oil shortage in 1973-74, and decided to sell the B&M plant. Because of the quick need for cash, Crawford Industries was willing to sell the plant, and all of its contents valued at $900,000.00, for only $400,000.00. The president of GCF, who may be the identity of our mysterious Mr. X, knew that this was too good of a deal to pass up. The president of GCF approached the First National Bank of Jefferson Parish (FNBJP) to borrow for the loan. The bank denied him the loan, on the basis that the amount was to big for one individual to borrow. Upon inspecting the property in Schriever, LA, the bank changed its mind, and allowed the president of GCF the loan. There was only one problem. The president of GCF already approached Marcello to be a partner with him on this deal. On May 16, 1975, Marcello signed as an endorser on the demand note to purchase the plant (8).
The plan was to sell all of the equipment at the plant to pay the $400,000 loan off quickly. After a couple of months, payment to the bank stopped. The bank called Marcello, notifying him that the payments had quit coming. Marcello assured the bank that the payments would begin again, and will personally send “his man” to make sure things were straightened out. Instead of giving the money to the President of GCF, the money was brought directly to the bank by Marcello’s representative (9).
On June 1, 1975, Gulf Coast Fabricators sold the Schriever plant to the President of GCF and Carlos Marcello as individuals. The sale of this transaction was $1.00, and was not recorded until January of 1976. The insurance on the property of the plant continued to be paid by GCF, while it was owned by Marcello. After the title of the property was transferred, the President of GCF and Marcello tried to get the loan refinanced. To make matters even more suspicious, they were requesting to refinance the loan in the name of Gulf Coast Fabricators(10). They were unsuccessful in their attempts to refinance the loan, Marcello’s reputation surely being a factor. The loan was fully paid off in 1976.
It was obvious that Marcello had some sort of interest in Gulf Coast Fabricators. While FBI agents familiar with the Mafia’s “bust out” tactics were called to investigate (11), it was likely that Marcello’s motive was not to “bust the place out”, but rather embezzle funds while keeping the company running. In a “bust out”, the Mafia is a silent partner in a company, acting as a parasite, bleeding the company until ruin. Marcello’s plan may have been just as parasitic in nature, but if the host dies so does the parasite. This company would be more profitable to Marcello if it stayed operational. The FBI determined that Marcello “derived a beneficial interest from his association with GCF.” Marcello could either use the company as a front or for a quick source of cash (12). Why else would Marcello volunteer as an endorser on a note for a company on whose credit he planned to ruin?
While the FBI’s investigation into Marcello’s control over GCF didn’t drudge up enough incriminating information to warrant a RICO indictment, the head of the UNIRAC Miami Strike Force felt confident he could charge Marcello with a two count perjury indictment. The New Orleans FBI office agreed and set a date to seek these indictments: 11/17/77 (13). The U.S. Justice Department didn’t share the confidence of the Miami and newly formed New Orleans Strike Force. Several FBI memos complain of the Justice Department dragging their feet on coming to a decision on whether or not to indict Marcello. Finally, in 1978, the U.S. government decided not to press charges against Carlos Marcello; their reason being that there was no proof beyond a reasonable doubt that Marcello purposely committed perjury (14).
While the government wouldn’t be able to prosecute Marcello with the information gathered during the UNIRAC investigation, it would give a glimpse into Marcello’s financial empire.
According to the Louisiana State Police Intelligence Division, Marcello controlled the following businesses: Elmwood Plantation, Inc., Stevie Motel, Inc., Holiday Motel, Inc., Marco, Inc., Marcello and Associates, Inc., Marsh Investment Corporation, Imperial Meat Company, Inc., Churchill Farms, Inc., and Gems, Inc. (15).
In investigating only one of Marcello’s many bank accounts, the FBI uncovered that Marcello received the following amount of money from the following companies in between the years of 1975 and 1976: $12,000.00 from Gulf Caribbean Enterprises (GCE), 10,000.00 from Jefferson Disposal Company, and $10,000.00 from a company whose name is redacted in the documents (16).
Marcello would also divert funds from his personal banking account to the following companies in between the years of 1975 and 1976: HPB, Jr. Development Corporation, Stevie Motel Corporation, Marco, Inc., Churchill Farms, the Louisa Corporation, Town and Country Motel, Marsh Investment Corporation, Lad Investment, Jefferson Music Company, Elmwood Plantation, Inc., Broussard’s Resturant, Bayou Verrett, Gem Corporation, DeWeese Properties, the Louisa Corporation, Southern Tours, Pier 90 Lounge, and Pelican Tomato Company (17).
Gulf Caribbean Enterprises (GCE), the fishing company that gave Marcello over $12,000.00 between 1975 and 1976, captured fish and lobsters off the small island of Utia, 10 miles off the northeastern coast of British Honduras. The Jefferson Parish Sheriff’s Office (JPSO) advised the FBI that GCE was a Marcello controlled business and may be involved in narcotics smuggling. Alleged narcotics smuggling wasn’t the only thing that Marcello was involved with in South America. According to a confidential informant with the JPSO, Marcello was involved with trying to establish gambling in Honduras (18).
But as soon as the FBI would finish its UNIRAC investigation of Marcello, it would begin its BRILAB (Bribery and Labor) sting against the Mafia boss (19). Starting in 1979, the investigation would get Marcello on tape talking to undercover FBI agents about his criminal empire. On January 26, 1982 Marcello would be sentenced to seven years in prison. On one of the BRILAB tapes, Marcello was heard talking about bribing a federal judge in Los Angeles; he received an additional ten years for that. In 1989, the 5th U.S. Circuit Court of Appeals threw out Marcello’s BRILAB conviction, and the mobster was released. After suffering from Alzheimer’s and a series of strokes, Marcello died in his Metairie home on March 3, 1993 (20).
