Providence Journal-Bulletin

U.S. Judge In Miami Drops Labor-Racket Charges Against 3


Journal-Bulletin Staff Writer

Dec. 8, 1984

After seven weeks of trial, a federal judge in Miami has dismissed labor racketeering charges against three men from Rhode Island and Massachusetts because the prosecution failed to prove a conspiracy existed between the defendants and an informant during the five years before their indictment in September, 1981.

The dismissal of the case against Arthur E. Coia of Providence, national secretary-treasurer of the Laborers International Union of North America; former Providence Rep. Albert J. Lepore and Joseph J. Vaccaro Jr. of Winchester, Mass., a former trustee of a union training school, cannot be appealed by the government, according to prosecution and defense lawyers.

The dismissal by U.S. District Judge James L. King because the statute of limitations had expired does not technically affect a fourth defendant in the case, Providence lawyer Arthur A. Coia, Arthur E. Coia's son and a law partner of Lepore who is business agent for the Laborers' Rhode Island District Council.

But unless the government uncovers other evidence it did not have at the trial, which ended two days ago, Judge King's ruling would appear to apply to the younger Coia as well. A lawyer from the Justice Department's Organized Crime Strike Force said no decision had been made whether to continue to press the prosecution of Arthur A. Coia, who is scheduled for a new trial in January.

The younger Coia originally was a defendant along with the other three men, but at the request of his Boston lawyer, Earl Cooley, Judge King declared a mistrial in his case in the midst of the prosecution's case.

COOLEY SAID last night that he asked for the mistrial after eight or nine days of testimony in the jury trial because he became ill from a diabetic condition. He said he became so sleepy "I couldn't keep my eyes open" in court, a condition he attributed to a high blood- sugar content.

Because of this, Cooley said, he told King that he could not adequately represent his client and the judge accepted that and without requiring any doctor's corroboration, ordered a mistrial as to the son.

Cooley said "I no longer represent" Arthur A. Coia but said "I'm sure other counsel" will file a motion in the younger Coia's behalf asking that his case be dismissed in light of King's ruling.

THE COIAS, Lepore, Vaccaro and then-New England crime boss Raymond L.S. Patriarca (now deceased) were indicted on Sept.23, 1981, for violating the federal Racketeer Influenced and Corrupt Organizations Act (RICO) in connection with alleged misuse of funds from the 900, 000-member Laborers International Union of North America, one of the nation's largest unions.

The charges stemmed from a joint grand jury investigation in Miami and Boston and followed by about three months the indictment of 16 men, including underworld kingpin Santo Trafficante Jr. and Laborers union president Angelo Fosco for an alleged conspiracy to split $2 million in kickbacks on union trust funds.

THE INDICTMENT charges that the Coias, Lepore, Patriarca and Vaccaro conspired to skim money intended for union members' insurance benefits through the use of kickbacks, payoffs and improper personal expenses.

It was alleged that the elder Coia met several times during the 1970s with Joseph A. Hauser, a convicted California insurance swindler, and others to discuss splitting up the union's insurance business to make money for themselves.

Patriarca, it was alleged, was slated to "control" the business for the Northeast. No evidence against him for his part in the alleged conspiracy was presented in the trial that ended earlier this week, lawyers said, because Patriarca was not on trial at the time.

But the indictment says that in 1976, Patriarca told Hauser that the insurance business of the Laborers Union would be controlled by "The Family." Patriarca would control business in the Northeast, Trafficante in the South and Anthony "Big Tuna" Accardo in the Midwest.

A jury acquitted Fosco and Accardo in 1982, and Trafficante, reputed mob boss in Miami, had his case severed from the rest, as Patriarca had before his death last summer, because of illness.

The younger Coia and Lepore, according to their indictment, set up the Northeast Insurance Agency in Rhode Island, which "puportedly engaged in the sale of insurance, but . . . in fact, served as a conduit for kickbacks."

THE INDICTMENT also said that Lepore and the elder Coia received " two checks totaling $50,000 from Joseph Hauser." The defendants got numerous other smaller payments from Hauser in the 1970s, it was alleged.

It was also alleged that the younger Coia and Lepore appeared before the Securities and Exchange Commission in Washington and testified falsely in an attempt to thwart that commission's investigations.

The indictment also said that the elder Coia and Hauser "caused $1 million to be transferred" out of a bank account that held insurance premiums for the Massachusetts Laborers Fund.

In March, 1976, the indictment says, the elder Coia met with Gilbert H. Hawkins, then a senior loan officer at Citizens Bank in Providence, "and offered to use his influence to divert union funds" to Citizens if the bank would lend the money to buy a New Jersey insurance company. The loan application was rejected.

Thursday's action the second time Judge King had dismissed the case against the Coais, Lepore and Vaccaro on grounds the statute of limitations had expired. Under federal law, indictments must be obtained within five years after crimes were committed, except in capital cases such as murder.

King ruled during pretrial motions in 1982 that the government brought the charges too long after the crimes were allegedly committed because it could not prove at least one "overt act" (a physical act that furthered the conspiracy) during the five years before the defendants' indictment.

BUT THAT ruling, appealed by the government, was reversed by a federal appeals court in Atlanta, which said that proof of an "overt act" is not required to convict someone of conspiracy under the RICO act.

James Jay Hogan, the elder Coia's Miami lawyer, told the Journal-Bulletin yesterday that at the defendants' request, King granted a judgment of acquittal on Thursday because "the government couldn't establish through their traveling witness, Joseph Hauser, that there was a conspiracy" that continued after Sept. 23, 1976 until Sept. 23, 1981 when the indictments were handed up.

Hogan said the only testimony presented from Hauser during that time concerned "an alleged phone call" between Hauser and the elder Coia "where Hauser said he was going to Europe to get a re-insurance company" to insure his insurance company so he could get business from the Canadian Laborers' union.

However, Hogan defense investigators had found papers in another court case in New York in which prosecutors had stipulated that the reason Hauser was going "was to smuggle money of his own out of the United States."

Hauser was indicted for insurance swindling on Oct. 28, 1976 and served 18 months of a 30-month sentence. He turned informant in February, 1979, and has been "testifying under government immunity for last six years," according to Hogan. Based on his testimony, 11 people thus far have been convicted by a jury on federal racketeering charges in Miami. Three have been acquitted by a jury.

A STRIKE FORCE prosecutor said that because of the stipulation filed in the New York case, King found the phone conversation between Hauser and the elder Coia "could not not have been about continuing the conspiracy . . . and that therefore the conspiracy had ended" prior to Sept. 23, 1976. "Most of what we showed concerning crimes occurred in 1975 and 1976, before Sept. 23," the prosecutor said.

He said a 1979 tape-recorded conversation between Hauser and the elder Coia was played to the jury in which they "discussed a previous $3, 000 kickback." But that was "after the conspiracy had ended," he said.

Copyright © 1984 The Providence Journal Company

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