FORMER CONGRESSMAN RENZI CONVICTED IN ILLEGAL FEDERAL LAND SWAP SCHEME

FROM: U.S. DEPARTMENT OF JUSTICE
Tuesday, June 11, 2013

Former Congressman Richard G. Renzi Convicted of Extortion and Bribery in Illegal Federal Land Swap

A former U.S. Congressman and a real-estate investor were convicted today by a federal jury in Tucson, Ariz., of conspiring together to extort and bribe individuals seeking a federal land exchange, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney John Leonardo of the District of Arizona and Special Agent in Charge Douglas F. Price of the FBI’s Phoenix Division.


Richard G. Renzi, 55, of Burke, Va., was found guilty of 17 felony offenses including conspiracy, honest services wire fraud, extortion under color of official right, racketeering, money laundering and making false statements to insurance regulators.

James W. Sandlin, 62, of Sherman, Texas, was found guilty of 13 felony offenses including conspiracy, honest services wire fraud, extortion under color of official right and money laundering.

Sentencing is set before U. S. District Judge David C. Bury on Aug. 19, 2013.

"Former Congressman Renzi’s streak of criminal activity was a betrayal of the public trust and abuse of the political process," said Acting Assistant Attorney General Raman. "After years of misconduct as a businessman, political candidate and member of Congress, Mr. Renzi now faces the consequences for breaking the laws that he took an oath to support and defend."

"Our democracy is undermined whenever our elected officials misuse the power entrusted to them by the voters to serve their own private interests rather than in the service of the public interest," said U.S. Attorney Leonardo. "The jury’s verdict reinforces the fundamental principle that our society is governed by the rule of law, and that no citizen, including the most influential and powerful among us, is above the law."

"Today's conviction is a culmination of the investigative efforts of the FBI and IRS-Criminal Investigation over a period of several years," said FBI Special Agent in Charge Price. "Public corruption is one of the top criminal priorities of the FBI, and it is imperative that elected public officials be held accountable to uphold the public's trust. The FBI remains committed to this criminal priority in combating public corruption at all levels."

According to evidence at trial, Renzi, then a member of Congress from Arizona’s 1st Congressional District, promised in 2005 to use his legislative influence to profit from a federal land exchange that involved property owned by Sandlin, a real-estate investor.

At the time, Sandlin owed Renzi $700,000 in future payments from their business dealings, and Renzi threatened a proponent of the land exchange that he would not support it unless they purchased Sandlin’s property in Cochise County, Ariz. When that individual refused, Renzi promised a second proponent of a land exchange that he would support the exchange if they purchased Sandlin’s property. According to an agreement reached in May 2005, Sandlin was paid $1 million in earnest money, out of which he paid $200,000 to Renzi. Just before Sandlin received the $1.6 million balance owed on the exchange, he paid an additional $533,000 to Renzi.

Evidence at trial further showed that from 2001 to 2003, Renzi engaged in insurance fraud by diverting his clients’ insurance premiums to fund his first campaign for Congress, and he provided false statements to various state regulators who were investigating his activities.

Renzi was indicted in February 2008, and in October 2008, Renzi moved to dismiss the indictment under his rights as a member of Congress under the Speech or Debate Clause. The court denied his motion in February 2010, and Renzi pursued an interlocutory appeal. After Renzi’s appeal was unsuccessful, trial was set for May 2013.

Honest services wire fraud, extortion under color of official right, concealment money laundering and racketeering each carry maximum penalties of 20 years in prison. Conspiracy carries a maximum penalty of five years in prison, and making false statements to insurance regulators and transactional money laundering each carry maximum penalties of 10 years in prison.

This case was investigated by the FBI and the Internal Revenue Service – Criminal Investigation. The prosecution was handled by Trial Attorneys David Harbach and Sean Mulryne of the Department of Justice’s Public Integrity Section and Assistant U.S. Attorneys Gary Restaino and James Knapp of the District of Arizona.

FIVE PLEAD GUILTY TO RACKETEERING IN ORGANIZED CRIME CASE

The following excerpt is from the Department of Justice website:

Thursday, February 16, 2012
"WASHINGTON – Five Rhode Island men previously identified as leaders or associates of the New England organized crime family of the La Cosa Nostra (NELCN) have agreed to plead guilty to racketeering-related charges, according to documents filed today with the U.S. district court in Providence, R.I.

The announcement was made by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Peter F. Neronha for the District of Rhode Island; Richard DesLauriers, Special Agent in Charge of the FBI’s Boston Field Office; Colonel Steven G. O’Donnell, Superintendent of the Rhode Island State Police; and Providence Public Safety Commissioner Steven M. Pare.

The defendants were charged in a second superseding indictment returned by a federal grand jury in Providence in September 2011, which alleges their participation in an extortion and racketeering conspiracy involving “protection” payments from several Rhode Island businesses.  The defendants face sentences of up to 20 years in prison and fines of up to $250,000.

According to plea agreements signed by the defendants and filed with the court, Luigi “Baby Shacks” Manocchio; Edward “Eddy” Lato; Alfred “Chippy” Scivola; and Richard Bonafiglia will plead guilty to one count of conspiracy to participate in a racketeering enterprise.  Raymond R. Jenkins will plead guilty to one count of conspiracy to participate in a Hobbs Act extortion.

According to the plea agreements, in addition to admitting to their criminal conduct, Manocchio, Lato and Scivola admit to their membership in the enterprise charged in the second superseding indictment, which is the NELCN.   In addition, in their signed plea agreements, Manocchio and Lato admit to being organizers and leaders of the enterprise’s criminal activity.  As alleged in the indictment, Manocchio was an underboss and boss of the NELCN and Lato was an NELCN capo, primarily responsible for Rhode Island.   Lato also admitted in his plea agreement to related extortion activity charged in the indictment.

Theodore Cardillo and Albino “Albie” Folcarelli, also named in the second superseding indictment and identified as alleged associates of the NELCN, are scheduled for trial on April 23, 2012.
An indictment is merely an allegation and is not evidence of guilt.   A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

An eighth defendant named in a previous superseding indictment in this matter, Thomas Iafrate, of Johnston, R.I., pleaded guilty on July 21, 2011, to one count of conspiracy to participate in a racketeering enterprise.   He also admitted that he was an associate of the NELCN.   Iafrate was sentenced in December 2011 to 30 months in federal prison, to be followed by three years of supervised release.

The cases are being prosecuted by Assistant U.S. Attorney William J. Ferland for the District of Rhode Island and Trial Attorney Sam Nazzaro of the Criminal Division’s Organized Crime and Gang Section.  The matter was investigated by the FBI, Rhode Island State Police, Providence Police and Internal Revenue Service – Criminal Investigation.”