Nino Perrotta was a U.S. Secret Service agent in New York who investigated the Mafia and former Detroit Tigers star Denny McLain, the only major league pitcher to ever win 31 games. His probe involving McLain and mobsters came in mid-1990s and centered around the sales of phone cards that were particularly popular among foreigners in the U.S., who used them to call relatives back home.
Schemes included deactivating the cards once they were paid for or shortchanging the people who bought a certain number of minutes.
"We had wiretaps on Gotti and his associates and Denny was mentioned as their go to person for great rates," Perrotta tells Deadline Detroit.
In 1998, while McLain was behind bars for stealing money from a pension fund of Peet Packing in Chesaning, outside of Saginaw, he was named in a 40-person indictment that included John Gotti Jr., son of Gambino crime boss Johh Gotti. Charges included gambling, extortion and racketeering, however, McLain, now 72, was only charged in connection with a phone card fraud scheme.
As part of a plea agreement with the Gambino crime family, the phone card charges were dropped against everyone including McLain, Perrotta says.
Perrotta resigned from the Secret Service in 2003 and now operates a security consulting firm in the Washington, D.C. area.
The following is an excerpt from his just-released book "Dual Mission."
Deadline exchanged emails with McLain, who was sent a copy of the book excerpt. He initially responded:
I would be pleased to meet with you and you can judge then what the real truth of another Denny McLain Chapter in the world of creativity is. You be the judge.
After setting a deadline to meet, nothing materialized. An invitation to respond remain open.
-- Allan Lengel
By Nino Perrotta
It was late November of 1997, and after speaking to Denny McLain on numerous occasions at the United States Attorney’s Office for the Southern District of New York, located in White Plains, New York, it was clear that he was going to be a “major player” in another game: the blame game.
From the onset, McLain used every excuse in the book and blamed all the mishaps that occurred in his life, including his business activities at Tel Central Communications, on others. Denny had an excuse for absolutely everything that went wrong in his life, including his most recent fraud scheme. This guy wanted to claim that MCI had overcharged his account, and due to a loophole that he believed had legitimacy, he was going around telling everyone that his debt with MCI was going to be erased. It was unbelievable to me how this man saw everything as someone else’s problem.
What I found amazing was that Denny never took ownership for his actions and refused responsibility for anything. Between the constant requests for Diet Pepsi, fried chicken, and pastries, it became very clear that he was going to play us to the very end. Regardless, Denny wasn’t going anywhere since he was serving time for defrauding a pension fund and was serving time he, of course, blamed others for. After a painful attempt to get him to confess to the scheme, we moved past him and brought in a close family member who was directly involved with Denny. To protect him we will call this person Lou.
With Lou (not the real name of McLain's son-in-law) it was another story. He was a nervous individual, and in my opinion, basically a good man who got caught up with the larger-than-life personality of his father-in-law, the former great major-league ball player. During that December 19, 1997, interview, Lou laid out the groundwork as to how his father-in-law would create constant opportunities to defraud consumers of their phone time whenever they utilized their prepaid phone cards. The act was simple in scope. It basically involved shutting the users’ usage of their purchased prepaid calling cards.
It was that plain and simple. So while the poor unsuspecting consumer, many of whom were hardworking, lower-income individuals, were speaking to family overseas, Denny, from the comfort of his own home or office, monitoring this activity from his computer, would shut a series of phone cards off, forcing the consumer to reconnect and automatically deducting a fee, typically $1 from the card for that connection to occur.
This was called a “bong” charge, and now Lou confirmed that this was an act that Denny was known to do. He continued by explaining the below-market pricing and the affects that had on the switches that handled the phone traffic. Folks would receive a busy signal when- ever they tried to use the cards. This was the direct result of extremely attractive below-market rates which caused a huge demand on the market. There was absolutely no-to-minimal investment made in the infrastructure (the switches) coupled with the creation of enough of a “blame game” to muddy the waters. It was, in fact, an almost undetectable scheme.
The ring of thieves that collectively participated in committing this fraud had, in my opinion, done a great job at layering the scheme in such a manner that it was both complex and offered many opportunities for an investigator to come up on dead ends and convoluted leads. Lou, however, was able to lay out the process, explain, and most importantly, verify, what I already knew; how certain cards were replaced by others. Lou was instrumental. He was a witness with an inside view of the crime.
Lou offered specific information and explained how the rates offered by Denny were completely below the market rate and how there was absolutely no way he would be able to pay MCI for the minutes purchased. The offering of below-market prices was a technique to attract consumers and rapidly capture the marketplace. Denny knew fully well what he was doing and was instructed to place certain cards on his switch. The Mafia had control of which cards would be distributed and sold in the market. This was captured in the May 28, 1996, intercepted conversation where Gotti explained “the process” to Plomitallo.
'Intimidated and afraid'
Lou then talked about his experience with the Mafia. He stated that one day both he and Denny met with a group in New Jersey, some- time in late 1996, to discuss business and an IPO. This meeting had several Mafia figures, like Gene Lombardo and a “known” crook that specialized in fraudulent IPOs. At one point after the meeting, they headed to a bar, and there, an individual who’s name has been changed “Michael”” asked Lou a very important question. Would he take over the business in the event Denny had to go to jail?
Lou said he was not sure if he should provide an answer. He explained that he was intimidated and afraid at that point that both he and Denny may not come out of the meeting alive.
The operation’s briefing leading up to the arrests were held at 7 World Trade Center. There, we had all the respective leadership to discuss the arrest operation, protocol, and safety measures. John Buechele was handling the operations order and the coordination of the briefing while I continued to work on the case. I never stopped working the investigation.
I knew that this was going to be one of those cases where we would most definitely have to go to trial, so I wanted to be prepared as much as possible for when the time came. I was prepared and ready. The rumblings had started; we had the FBI complaining that the Secret Service was given permission to affect all of the arrests as opposed to selecting them. In addition to the arrests, there were all sorts of issues being raised on how to handle John Gotti Junior on game day. It all seemed a bit petty and irrelevant to me. I mean, the guy was aware that his arrest was imminent due to the local city newspaper articles printed about it on a weekly basis.
I recall being dispatched to affect the arrest of Junior with Bronx D.A. Detective Sgt. Investigator Frank Thorpe. We were in Oyster Bay, Long Island, and it was a cold morning. Out in front of Junior’s home camped out with their TV cameras and lights were the press. Of course, Junior was not there, but we needed to confirm it. It was funny . . . The FBI had requested SWAT teams for these arrests and wanted to make a production out of arresting Gotti Junior. Echo would not have any part of it. I believe he did everything he could to undermine their production. At the time, he kept his plans to himself, but not until recently did he share his plans with me.
Thorpe and I were tasked to go to Gotti’s Oyster Bay residence and see if Junior was there. Echo made it clear from the start that he did not want this to be a circus and seeing that the FBI wanted to make it such, he called Richard Rehbock. Echo requested that Rehbock have John surrender at a location that made sense to everyone. Later, when Rehbock called Echo back, Bill from the FBI overhead the conversation Echo was having and reported back to Jack that Echo was speaking to Gotti’s lawyer. Word about the conversation got back to Vince Heintz, and although it was completely distorted and one-sided, nevertheless, it threw Vince into such a frenzy that he immediately went to Mitch Lambert, Echo’s boss at the time, and asked for him to be fired.
Well, I guess there was reason to send me and Thorpe to the residence because of the fact that when we got there, due to the way we were dressed and looked, the news reporters did not give us a second glance. They never suspected we were the feds and assumed we were part of the wise guys who were in the backdrop. I was clean-shaven, wore a dark suit under a long black overcoat. There was nothing on me that depicted law enforcement and Thorpe was dressed the same, although he remained in the car.
I walked up to the gate and spoke to the caretaker who spoke Italian and asked him if “il padrone era a casa.” He responded back in Italian, “No, the owner is not home,” and on that note, I signaled with a nod my satisfaction, turned, and walked back to the car.
Belated realization by media
The press pretended I didn’t exist partly because they assumed I was a gangster and why would anyone want to get in the way of a gangster. Well, that was until I opened the car door and in plain view was a police light.
Someone yelled out, “Oh shit, they’re cops.” Within seconds, the lights and the cameras turned on. I had just enough time to enter the vehicle, lock the door so my partner, Thorpe, could put the car in reverse, and get out of the area.
I eventually connected with Echo, and as we were heading back to the Armory, we were both waiting and sitting in the back of an unmarked police vehicle when Echo received a call from Vince. Echo turned to me and explained that Richard Rehbock, John’s attorney, was coordinating the surrender through the U.S. Attorney’s Office. When the call came, Echo had offered me the honor of handcuffing Gotti Junior, a major compliment to me. However, this was not to happen. We learned minutes later that Jack and my boss with the pinky ring had Gotti Junior secured and they were transporting him to the Armory. The two were caught bringing Gotti into process- ing and the press photographed the three entering the building. My boss who was wearing a raid jacket would brag about his arrest in the years that followed. Years later, he recounted his exploits to the counterfeit squad while telling tall tales, when an agent stood up and for the record said, “Hey, you didn’t arrest Gotti; that was Nino’s case.”
The arrest of Gotti Junior and the successful investigation into his crew was one outcome I am very proud of. We beat the FBI at their own game. Now the FBI volunteered fingerprint technicians for the arrest day, and, of course, no one saw any issue with using the technicians.
What was agreed upon during the planning stages of Operation Ricochet was a simultaneous arrest of 45 members/associates of the Gambino crime family. The agreed terms between the OCTF and Secret Service were for the lead arresting agency to be the Secret Service.
'An underhanded move'
FBI technicians, I quickly realized that day, had FBI fingerprint cards with the ROI number identifying the arresting agency as the FBI. So for every damn “perp” that was walked in that day, no matter what the charge was, credit would go to and the arrest would be considered an FBI arrest.
They really were good at this and credit be given when due, even if it was an underhanded move. So what I did to counter this strategic win was that I printed Gotti myself on Secret Service fingerprint cards. This would ensure that when the arrest charges made it through the system, the credit went to the United States Secret Service and not the FBI. Yes, a small victory, but it did rob them of their scheme. Top brass of the Secret Service and OCTF were involved in the entire ar- rest planning.
Thinking back I joined the investigation back in the 1994-95 time frame, listening to Craig DePalma ranting and raving in his home. For a brief time while I was there, the investigation did have Craig’s phone tapped, but it was believed that he was not relevant and therefore, the court order to listen in on his cell phone was not renewed. Pre-Secret Service involvement in the case that got me both in the spotlight as well as in hot water, was the fact that I went back and listened to those recorded conversations and found evidence of criminality when Craig was on the cell phone. I convinced Vince to go back up on Craig’s cell phone.
There was a great deal going on with Craig that was basically missed during the previous investigation. Although he was not as vocal as his dad Greg, he was communicating with Gotti Junior. This was enough.
Part of our ability to target Gotti Jr. was the information obtained from these cell phone conversations, surveillance that was conducted from those communications, as well as from his cloned beeper which provided the team with real-time transmittals. I fine-tuned my investigative skills prior to joining the Secret Service and increased confidence in my own ability. These two factors helped me tremendously when I returned to the case.
'His instincts were rarely wrong'
Vincent Heintz was on his way to work, and from the corner of his eye, he noticed Craig DePalma near the White Plains Courthouse, obviously leaving his weekly meeting there and heading in a direction that did not take him directly home. Vince was a cop at heart and a National Guard infantry officer; his instincts were rarely wrong. He and I were very close and spoke constantly about the case. We would spend hours every day simply discussing strategy and rehashing every aspect of the investigation.
So when he called me, I knew it was important. Craig was on house detention and could only travel under specific guidelines that were prearranged during his arrest. At the time, he had to go home and not deviate his travel route from his home to the Federal Courthouse in White Plains. Vince, knowing something was amiss, initiated surveillance, and at the time, I did not know that he had called the FBI to assist, and they declined due to not having enough advance notice. They were unable to execute.
So Vince calls me; I’m in my office at 7 World Trade Center, and he’s in White Plains. Under normal conditions with no traffic, one would need at least 45 minutes to an hour to get there. Vince explained the situation, and as soon as he was done talking to me, I called upon a loyal agent who was a true investigator, my friend Michael. He was assigned to the Secret Service White Plains Office, an office of about seven people, including a boss. Michael, in his office doing paper- work, immediately grabbed his gun and jacket and headed out to join Vince on the impromptu surveillance. Vince was on the tail; Michael was about to meet him; and I got into my blacked out 1997 Firebird with its full police light package, a rarity in those days. I bolted out of the garage and within minutes was on the Henry Hudson Parkway heading northbound.
I went as fast as possible, lights and sirens all the way and with little traffic, thankfully, I made it within 20–25 minutes. He relieved Vince who headed to the office and upon my direction began to prepare a subpoena. As I approached the scene, I noticed they were in Denny’s restaurant, with Michael having entered inside, ordered some ham and eggs of some sort and watched as Craig met with some associates. Immediately, I knew from my investigative experience that the restaurant had live video surveillance recordings for security purposes. I would need this footage to provide teeth to the field report that I was going to prepare later that evening.
Craig was meeting with folks from the construction industry, and we found out later it was to resolve a beef, and he thought no one was watching . . . While they were sitting there, I walked into the restaurant unnoticed and with a quick flash of my Secret Service gold badge, I informed the manager that I would need his recorded video surveillance and that a subpoena would be provided shortly. He immediately complied and assured me that the surveillance video would be provided as soon as the subpoena was delivered. I thanked him and returned to my vehicle. Craig was in violation of his court- ordered detention and for this, he would soon realize how painful this maneuver would be to the Gambino crime family.
'A real looker'
Now please note that if this had happened tgwo or three days earlier, I would have been unable to participate because I was working a protection assignment. The life of a Secret Service agent was that volatile and the dual rolls we held were a challenge. Although Michael was great, he did not have the institutional knowledge of the case necessary to make decisions based on incoming information that changed rapidly.
Surveillance from the restaurant led us to Craig’s girlfriend’s home where he had approved house detention—an apartment in Bronxville area, Westchester County. His girlfriend was a real looker, a stripper who was into rough sex I learned that day.
As Craig pulled into the underground garage of the apartment complex and once I received a green light from Vince, now at the U.S. Attorney’s Office, I quickly hit the lights and siren. I “lit him up,” as they say, and he stopped his car. I got out of the car, introduced myself and explained that he was in violation of his home detention. Mike was there supporting me and making sure that we had no safety issues. Craig whined, and I gave him no opportunity but to tell him to park the car and “Let’s go upstairs.” Now with home detention, he has no right to privacy, and since that was the case, I began to search his home. My partner was there and providing entry security since we did not want any problems or distractions.
While searching his apartment, I feigned a need to make an urgent busi- ness call. Normally, I would have used the house phone, but instead, I pulled out my Motorola flip phone. The real reason for this maneuver was to see how Craig made and received calls so as to keep him in communication with his superiors within the Gambino crime family. I soon realized that inside the apartment cell coverage was weak to nonexistent in certain areas. I made a statement to no one in particular but in a loud voice about “the fucking poor reception in this place” and being unable to make a cell call. I looked at Mike and offered a small but noticeable smile, letting him know I had a plan. I couldn’t believe it. Craig responded from the couch with “Go to the kitchen and lean out the window. That’s where I get the best reception.”
At that point I knew cell phones were being used between Craig and his associates. Within a few minutes of him making that statement, during the search, I located a cell phone in the kitchen, which was inoperable but well-hidden behind some dishes.
'It all came full circle'
Now, shortly after the incident, the girlfriend arrived and did nothing but scream, curse, and complain about the feds always harassing her boyfriend. She en- tered the bathroom, and then attempted to leave the apartment, BUT not without a search of her purse. During the search, I find the cell phone “he” was using, and, of course, we were able to prove this with the call records. Oh, and during my subsequent interview of the girlfriend, it all came full circle, as she was unable to explain away or tell me to whom those phone calls were made.
Once I got to the bedroom, the exciting stuff began. I found about 20k in cash, another violation, and chains and photos of him, the girl- friend, and a black male in some of the most sadistic sexual acts I had before or since seen. I did Craig a favor and handed him $1,000 from the money he had hidden. I also gave him the sick photos but vouch- ered the chains and whips for further investigative follow-up. The Gambino crime family had gotten another taste of the Secret Service, and I can tell you they were not accustomed to such aggressiveness.
By the end of 1998, the “core” team comprised of Vince, Vinney, Davie, Echo and myself, investigating the Gambino crime family had grown but the original members had mastered the art of investigating long-term investigations. We were now second to none, and our expertise made us subject matter experts to the point that whenever a voice was heard over an intercepted conversation, the name of who was speaking and whom he was associated with would be made available from memory in a matter of a few seconds.
At that time, we were considered, among our peers, as a modern-day version of the movie The Untouchables. It seemed all was going well . . . until the investigative team received a series of blows that required our attention.