Friday, November 30, 2012
Curt Arbitman, testifying in the racketeering trial of mob boss Joseph "Uncle Joe" Ligambi and six co-defendants, said when he agreed to plead guilty and cooperate with prosecutors he was forced to forfeit $600,000.
The money, he said, was an estimate of his take from a distribution network that he controlled from about 2000 until his arrest in September 2009.
His income, he told the jury, was based on a profit-sharing arrangement he had with the owners of the stops -- bars, restaurants and social clubs -- where his machines were placed. He said he worked a 75/25 split, meaning the stop owner got 75 percent of the take and he got 25 percent.
In effect, the buisness generated $2.4 million over that 10-year period.
Arbitman is expected back on the stand when the trial enters its seventh week of testimony on Tuesday. Prosecutors are now focusing on allegations that Ligambi, 73, and his two top associates and co-defendants, Joseph "Mousie" Massimino, 62, and Anthony Staino, 54, were major players in the poker machine business during the same period Arbitman was involved.
During Friday's court session, the jury heard dozens of wiretapped conversations in which Staino and Arbitman discussed maintenance and distribution issues. Arbitman acknowledged that he never charged Staino for any of the time he spent serving Staino's machines, although he said Staino would re-imburse him for the cost of parts.
While he never clearly stated why he agreed to that arrangement, prosecutors have implied that Arbitman did so to curry favor with the mob and to avoid being muscled out of the business.
Friday's testimony ended with Arbitman being questioned about what he knew about the Philadelphia crime family.
A native of South Philadelphia, he said, "You grow up there and you just, you know it."
Often stumbling and given to one-word answers and long pauses, the 55-year-old businessman did not appear comfortable on the witness stand. He referred to Staino as a "friend" and said he also knew Massimino and several other alleged mob figures, including Ligambi.
On several occasions he appeared confused or stumbled over references and comments in his own secretly recorded conversations picked up on wiretaps that had been placed on Staino's phone.
Dressed in a biege, v-neck sweater and dark slacks with a thin silver chain around his neck and two small, hooped silver earrings in his left earlobe, Arbitman spent nearly six hours on the witness stand Friday. With black, horn-rimmed glasses that sat on the bridge of his nose, he sometimes struggled to read from transcripts of the wiretaped conversations as he described a buisness relationship that stretched from the late 1990s through 2009, when the last of several raids occurred in which poker machines were seized.
In September 2009, he was targeted by state investigators who raided the gargage-warehouse he maintained in the 800 block of Mountain Street in South Philadelphia. Shortly after that raid, he cut his deal and agreed to cooperate, pleading guilty to the same racketeering conspiracy charge that Ligambi and the others face.
Both in the taped conversations and from the witness stand, Arbitman said the video poker machine buisness has been on the decline for more than a decade. And ironically, he told Staino in one conversation recorded in August 2009, when the business was booming there was less interference from law enforcement.
"Back in the day, when everybody was makin' money...they never got bothered, ever," he said.
Under questioning from Assistant U.S. Attorney Frank Labor, Arbitman was asked to break down his $600,000 profit figure for the jury. He said on average he was making about $125-per-week on each machine he had in play in 2001. By 2009, he estimated, he was making half that amount per machine.
While Arbitman was not asked how many machines he had on the street, the prosecution is expected to present evidence indicating that Ligambi, Staino and Massimino were generating even more income, in part by using threats of mob violence to force their way into other operators' businesses.
The tapes played for the jury also offered a look at the mundane business of maintaining poker machines and the sometimes cryptic or coded discussions aimed at disguising the fact that this was an illegal gambling business.
The owner of a coffee shop on Passyunk Avenue, for example, called frequently to Staino to complain when his machines were not functioning. But in those phone conversatoins, he complained about problems with his "espresso machine."
The shop owner was identified on the transcripts as Pasquale, but in several phone conversatoins with Arbitman, Staino referred to him as "the greaser" ( a clearly politically-incorrect term designating a recently arrived Italian immigrant).
In a phone call recorded in March 2001, Pasquale in broken English told Staino, "My espresso machine no work too good...Every time I put coffee in, it send it right back to me."
Arbitman, who was sent on several service calls to the shop, said this was a reference to the bill acceptor on the gambling unit rejecting money and spitting it back out.
On another tape, Staino mistakenly thought that Pasquale was again complaining about a problem with the machines when in fact he was informing him that his shop, which had been raided a few months earlier, had been hit again, this time by the FBI.
"They took the coffee machines," Pasquale said on a tape from April 2001. And after some confusion on Staino's part, Pasquale added, "They did the same thing as before. They took'em again...The FBI this time."