PART 4: CHAPTER 4

Organized Crime

I. Preface

The Commission has relied heavily on information and intelligence provided by experienced federal, state, and local law enforcement authorities regarding the involvement of organized crime in the pornography industry. This first hand knowledge is based upon years of investigative experience in the highly complex and covert area of organized crime. Many of these law enforcement authorities testified before the Commission on January 21-22, 1986, in New York City, at a hearing devoted primarily to matters relating to organized crime. The Commission has also used investigative reports prepared by the United States Department of justice, the office of the Attorney General of California, the Middle Atlantic-Great Lakes Organized Crime Law Enforcement Network (MAGLOCLEN), the Pennsylvania Crime Commission, the Washington, D.C., Metropolitan Police Department and others. Reliance on the investigative reports and the experience of these law enforcement authorities was necessary because the Commission operated without the authority to subpoena witnesses or compel their testimony regarding this sensitive area of inquiry.

II. Introduction

Organized crime involvement in the pornography industry has been described by law enforcement officers and by organized crime operatives themselves. A retired veteran Federal Bureau of Investigation agent said of traditional[1126] organized crime members, "you cannot be in the field and distribute pornography without their consent . . . ."[1127] He added that the pornography trade is attractive to organized crime because "it's a fast way of making a buck."[1128] Aladena Fratianno, whose involvement in La Cosa Nostra dates back to the late 1940's has reached the same conclusion.[1129] In an interview with a Commission investigator, Fratianno described the connection as he knew it to be in the 1970's as follows:

Another individual who was the owner and operator of an "adult" bookstore and spent many years in the pornography business described his experience in dealing with organized crime:

III. Organized Crime Involvement in Pornography

The 1970 President's Commission on Obscenity and Pornography was unable to draw conclusions regarding the role of organized crime in the distribution of obscene and pornographic materials. The 1970 Commission on Obscenity and Pornography found:

Although many persons have alleged that organized crime works hand-in-glove with the distributors of adult materials, there is at present no concrete evidence to support these statements.

The hypothesis that organized criminal elements either control or are "moving in" on the distribution of sexually oriented materials will doubtless continue to be speculated upon. The panel finds that there is insufficient evidence at present to warrant any conclusion in this regard.[1132]

There is some question about how the earlier Commission reached this conclusion.[1133] It is clear that the role of traditional organized crime in the pornography trade has increased substantially since the 1970 report was issued. Until 1970, only one LCN family, the Columbo organization, was known to have been involved significantly in the pornography business.[1134]

The Attorney General's Commission on Pornography has received reports from law enforcement officials, prosecutors, and legislators, describing the substantial role which organized crime, both in traditional (LCN) and non-traditional forms, plays in the pornography business in the United States today.[1135]

In addition to attorneys, many other professional persons assist organized crime families and their associates in the pornography business. Realtors handle land transactions knowing the ultimate purpose of the transaction is to facilitate the sale of obscene material.[1136] Landlords rent property to organized crime families knowing they will be used to warehouse obscene material or to sell, produce, distribute, or display obscene merchandise.[1137] Bankers process accounts and provide all manner of banking services (including the failure to report currency transactions as required by Title 31 United States Code). Printers and film processors develop the visual images taken by pornographers and turn them into finished products for sale or reproduction. Transportation companies and interstate carriers show no discretion in shipping obscene materials to increase organized crime family profits. Academics are paid to act as experts on behalf of organized crime members and associates who are brought to trial and challenged in public debates. Public figures including prosecutors, judges, city, county and state officials, zoning board members, and health department officials may be subjected to monetary and political influence. These people sometimes may ignore the organized criminal activity or impose minimal sanctions when punishment is unavoidable.

Following are highlights of reports provided to this Commission relating to traditional organized crime involvement in and control of the pornography industry.

One report came from a group of law enforcement officers, coordinated through the Investigative Services Division of the Washington, D.C., Metropolitan Police Department, which undertook a study in 1978 to determine the extent of organized crime involvement in the pornography industry.[1138] One reason for the study was, "(knowledge) that organized crime generally involves itself in situations where the gain far outreaches the risk. The pornography industry fits this description."[1139] "An initial probe determined that law enforcement could document Organized Crime control in certain geographic areas. However, it did not appear in 1977 that any single law enforcement body was in possession of documentation reflecting the situation on a national level".[1140] (emphasis added)

The project participants determined that traditional organized crime was substantially involved in and did essentially control much of the major pornography distribution in the United States during the years 1977 and 1978. The group further concluded that the combination of the large amounts of money involved, the incredibly low priority obscenity enforcement had within police departments and prosecutors' offices in an area where manpower intensive investigations were essential for success, and the imposition of minimal fines and no jail time upon random convictions resulted in a low risk and high profit endeavor for organized crime figures who became involved in pornography.[1141] During its seventy-eight year history, the Federal Bureau of Investigation (FBI) has been engaged periodically in investigation of persons and organizations who violate the federal obscenity laws. Though the FBI has not recently been involved in many large scale obscenity related investigations,[1142] Federal Bureau of Investigation director, William H. Webster, along with present and former special agents of the FBI have provided current information about the pornography industry.[1143] In the late 1970's the FBI prepared a report detailing the extent of organized crime involvement in pornography. In preparing that report, the Bureau conducted a survey of the fifty-nine FBI field offices.[1144] Based on the survey and other sources, FBI intelligence analysts concluded:

Information obtained (during the course of the enclosed survey) points out the vast control of the multi-million dollar pornography business in the United States by a few individuals with direct connections with what is commonly known as the organized crime establishment in the United States, specifically, La Cosa Nostra.. . . Information received from sources of this Bureau indicates that pornography is (a major) income maker for La Cosa Nostra in the United States behind gambling and narcotics. Although La Cosa Nostra does not physically oversee the day-to-day workings of the majority of pornography business in the United States, it is apparent they have "agreements" with those involved in the pornography business in allowing these people to operate independently by paying off members of organized crime for the privilege of being allowed to operate in certain geographical areas.[1145]

In 1985, at the request of the Attorney General's Commission on Pornography, Director Webster conducted a brief survey of the fiftynine FBI field offices concerning their knowledge of involvement of traditional organized crime in pornography. Director Webster advised this Commission, "About three quarters of those offices indicated that they have no verifiable information that organized crime was involved either directly or through extortion in the manufacturing or distribution of pornography. Several offices, did, however, report some involvement by members and associates of organized crime."[1146]

The FBI reported that on April 30, 1981, Joseph Palladino, a known dealer in pornography in Boston and Worcester, Massachusetts, met with Gennaro J. Anginlo in Boston.[1147] Anginlo is the underboss of the New England Organized Crime Family.[1148] Palladino complained that one Carlo Mastrototaro was opening an adult bookstore in the Worcester area to compete with the one jointly owned by Palladino and Mastrototaro. Palladino could not understand why the New York family had authorized Carlo to operate a competing pornography business. Prior to this, Palladino said he had considered Robert DiBernardo of the New York family to be his "compadre". In response, Anginlo  became angry because Palladino had first sought an explanation from DeBernado. Anginlo  said this prevented him from contacting DeBernado's boss in New York and he would now have to deal with Sam  Curfari, capo of the Genovese family in Massachusetts.[1149]

One former FBI agent told the Commission:

In my opinion, based upon twenty-three years of experience in pornography and obscenity investigations and study, it is practically impossible to be in the retail end of the pornography industry (today) without dealing in some fashion with organized crime either the mafia or some other facet of non-mafia never-the-less highly organized crime.[1150]

The Chicago Police Department has been involved in the investigation of organized crime families who are engaged in the distribution of pornography in the Midwest.[1151] Thomas Bohling of the Chicago Police Department Organized Crime Division, Vice Control Section reported, "...... it is the belief of state, federal, and local law enforcement that the pornography industry is controlled by organized crime families. If they do not own the business outright, they most certainly extract street tax from independent smut peddlers."[1152]

An overwhelming majority of obscene and pornographic materials are produced in the Los Angeles, California, area.[1153] Organized crime families from Chicago, New York, New Jersey, and Florida are openly controlling and directing the major pornography operations in Los Angeles.[1154] According to Chief Daryl F. Gates of the Los Angeles Police Department, "Organized crime infiltrated the pornography industry in Los Angeles in 1969 due to its lucrative financial benefits. By 1975, organized crime controlled eighty percent of the industry and it is estimated that this figure is between eighty-five to ninety percent today."[1155]

An investigative report submitted to the California Legislature by the Attorney General of California discussed organized crime infiltration into the pornography industry:

In the early 1970's... four organized crime groups moved in on pornography operations in California. They met relatively little resistance because the weak-structured organized crime group of Southern California lacked the necessary strength to deter the infiltration of organized crime from the East.

Organized crime figures first focused on production and retail operations in California. In this effort, they used the influence of their established national distribution network and effectively resorted to illegal and unfair business tactics. The newly arrived organized crime groups formed film duplication companies which illegally duplicated the films of independent producers and displayed them at nationwide organized crime controlled theaters. Faced with continued piracy and loss of profits, many legitimate producers were forced to deal with organized crime controlled distribution companies and film processing labs.

After gaining control or ownership of many California wholesale and retail companies, organized crime forced other independent retailers out of business through price manipulation. Wholesale prices to independent retailers were raised while prices to organized crime controlled outlets were lowered. Independents were undersold by organized crime controlled outlets until lost profits forced them out of business. Many competitors were bought out which allowed the subsequent raising of prices in other parts of the market. Some dealers that openly opposed this takeover were silenced by means of extortion and arson.[1156]

In 1984, California Attorney General John Van De Kamp reported that the arrival of home video cassette recorders on the market in 1979 was accompanied by a growing demand for adult video tapes.[1157] California pornographers, linked to the Gambino, DeCavalcante, Luchese and Columbo organized crime families entered this market through companies that produce, duplicate, distribute and sell adult video tapes.[1158]

Law enforcement agents have described the control of organized crime families in the pornography industry. Organized crime figures and associates are involved in the commerce essential to the pornography business through ownership of the distribution sources of the material. The 1970 Commission on Obscenity and Pornography reported ". . . crime syndicate members reported in interviews that it was not worthwhile for the syndicate to enter the business, primarily because there was no real economic inducement.[1159] In 1986, there are tremendous profits in the pornography industry. These profits are of the type that can be easily hidden from the Internal Revenue Service, because of the cash transactions and the policy of no cash receipts for merchandise.[1160]

Law enforcement officials have described large profit margins in the pornography business today.[1161] Magazines which cost fifty cents to produce wholesale for five dollars and the retail price is ten dollars or more.[1162] A fifty minute eight millimeter film wholesales for three dollars and retails for twenty dollars.[1163] Video cassette tapes which wholesale for fifteen dollars often retail for eighty to ninety-five dollars.[1164]

The well-known pornographic film "Deep Throat" was produced by the Periano brothers of the Columbo organized crime family for $25,000 and is reliably estimated to have grossed fifty million dollars as of 1982.[1165] The film was ". . . the biggest money maker of any film to that time and possibly since, in the state of Florida."[1166]

Joseph, Anthony, and Louis Peraino all became millionaires as a result of "Deep Throat."[1167] They used profits from the film to build a vast financial empire in the 1970s that included ownership of garment companies in New York and Miami, investment companies, a sixty-five-foot yacht in the Bahamas, "adults only" pornographic theaters in Los Angeles, and record and music publishing companies on both the east and west coasts.[1168] From 1973 to 1976, their corporate empire included Bryanston Distributors, Inc., a motion picture company that earned twenty million dollars in its first year of operation.[1169] The Perianos  also used profits from "Deep Throat" to finance drug smuggling operations in the Caribbean.[1170]

Aladena Fratianno, a.k.a., Jimmy Fratianno, a male member of a La Cosa Nostra organized crime family and a former Capo and later acting boss of the Los Angeles crime family, told this Commission that large profits have kept organized crime heavily involved in the obscenity industry.[1171]   Fratianno described this involvement to a Commission investigator as follows:

The Attorney General's Commission on Pornography concludes that organized crime in its traditional LCN forms and in other forms exerts substantial influence and control over the obscenity industry. Though a number of significant producers and distributors are not members of LCN families, all major producers and distributors of obscene material are highly organized and carry out illegal activities with a great deal of sophistication.[1173]

This influence and control has increased since the report of the 1970 Commission on Obscenity and Pornography and is particularly evident in the distribution of pornographic materials.[1174] Organized crime elements have found that the large financial gains to be reaped from pornography far outweigh the risks associated with the trade.

IV. Related Crimes and Activities

In addition to the myriad of other harms and anti-social effects brought about by obscenity[1175] there is a link between traditional organized crime group involvement in the obscenity business and many other types of criminal activity. Physical violence, injury, prostitution and other forms of sexual abuse are so interlinked in many cases as to be almost inseparable except according to statutory definitions. Among the crimes known to be interlinked with the pornography industry are:

  1. Murder

    One of the largest pornographers in the United States during the 1970's was Michael George Thevis, who headed Peachtree News in Atlanta, Georgia, and 106 other corporations.[1176] In October, 1979 Thevis was convicted in the United States District Court for the Northern District of Georgia for Racketeer Influenced and Corrupt Organizations Act (RICO) violations including murder, arson, and extortion.[1177]

    A leading figure in the national distribution of the film "Deep Throat", Robert De-Salvo, has been missing since January, 1976 and is presumed to have been murdered.[1178] De-Salvo provided evidence on behalf of the United States in the Bc trial arising from the "Deep Throat" film distribution.[1179]

    During the late 1970s a number of persons involved in the pornography business were murdered in what were believed by law enforcement agents to be pornography turf wars.[1180] The son of Joseph Periano, one of the producers of "Deep Throat" along with an innocent woman, was murdered "gangland style".[1181]

    Immediately prior to this Commission's hearing in Chicago, Illinois, in July, 1985, Patsy Ricciardi, owner of the Admiral Theater there, was found murdered. Chicago Police believe his murder was related to his dealings in the pornography business.[1182]

  2. Physical Violence Damage to Property

    The damage and injuries range from those sustained by performers[1183] forced to engage in physically harmful acts which can often result in permanent injury, [1184] to damage to property,[1185] "knee-breaking"[1186] and arson.[1187]

    A veteran FBI agent told the Commission "Over the years there has been heavy violence associated with the pornography industry. Some of the current well-known names in the industry have reported threats against them or physical brutality."[1188]

    A bookstore operator, associated with members of organized crime families, described the "discipline" within the pornography industry for those who choose to disobey rules regarding pricing, territory and other matters.[1119] He said, ". . . Bonjay a year and half ago, took one of the guys held him by his arms up against the wall in the alley, and it's common knowledge, the car ran into him, with the front bumper up against the wall and shattered his knees. That's a pretty good discipline.[1190] This same witness also reported bombs being thrown into stores that were not complying with general price agreements or failed to pay a street tax to organized crime families.[1191]

  3. Prostitution and Other Sexual Abuse

    "Prostitution is the foundation upon which pornography is built.... Pornography cannot exist without prostitution.... It is impossible to separate pornography from prostitution. The acts are identical except in pornography there is a permanent record of the woman's abuse."[1192]

    It is estimated that there are between 400,000 and 500,000 adult women who have been used in prostitution in America.[1193] A recent study found that the average age of the working prostitute was twenty-two; the average age a woman started working as prostitute was seventeen; sixty-three percent of the prostitutes had run away from home; eighty percent were victims of sexual abuse; eighty percent had pimps; and eighty-three percent had no savings or other financial resources.[1194] These women, who have been subject to every form of rape, sexual assault, and battery, and whose lives are totally controlled by their pimps, are used and abused by pornographers for the creation of their wares.[1195] It is impossible for most sexually explicit books, magazines, or films to be produced without acts of prostitution.[1196]

    Michael Joseph Glitta, one of the two major pornography distributors in Chicago, and a lieutenant in the Accardo organized crime family, controlled a "strip joint" where numerous persons have been arrested for prostitution related offenses.[1197] Pornographer Martin Hodas was identified by his former bodyguard as the one-time owner of a massage parlor and prostitution empire in the northeast.

  4. Narcotics Distribution

    Narcotics are often distributed to performers who appear in pornographic materials to lower their inhibitions and to create a dependency.[1198] Profits earned by organized crime from pornography sales have been used to finance drug smuggling.[1199]

    Joseph Periano, a soldier in the Columbo organized crime family, invested proceeds from the movie "Deep Throat" in drug smuggling. New York State Senator Christopher Mega, Chairman of the New York Organized Crime Commission, said, "Few have imagined that the profits of "Deep Throat" may have been part of the capital invested in the development of Norman's Cay into the major drug smuggling base north of the Panama Canal."[1200]

    Local police also report that "narcotic transactions are present in these deteriorating neighborhoods (where "adult bookstores" locate) and go hand-in-hand with the rampant criminal activity in those areas.[1201]

  5. Money Laundering and Tax Violations

    The nature of the pornography business provides inviting opportunities for skimming on[1202] every level. There is often dishonesty among producers, wholesalers, distributors, retailers and others who attempt to cheat each other.[1203] The often "cash only" business creates immense opportunities to launder money received from other organized crime activity.

    Bookstores which primarily sell sexually explicit material have a consistent sales format throughout the United States.[1204] Generally there are two separate operations for accounting purposes, loosely identified as "front room" and "back room" operations.[1205] The front room operation generally consists of a sales area for paperback books, magazines, rubber goods, lotions, stimulants and other materials.[1206] The front room operations profits are generally used to pay for rent, utilities, materials, and employee wages.[1207] The back room operations consist of peep machines which are coin operated and produce substantial income that is usually not reported as taxable income.[1208] A local police officer noted, "The back room operation usually takes in twice the amount as the frontroom operation."[1209] A bookstore operator and associate of known organized crime family members, reported to this Commission that such "skimming" commonly occurs with video cassette rentals and magazines as well as the peep machine coin boxes.[1210]

    Organized crime associate Martin Hodas, who was convicted in federal court, Buffalo, New York, in 1985 for obscenity violations has been heavily involved in peep machines.[1211]

    Michael Thevis, once a major distributor of pornography in the South, told a meeting of organized crime family members and associates that he owned ninety percent of the movie viewmatic machines in the United States. Michael was interrupted by Robert DiBernardo, a person alleged to be a member of the Gambino (and/or DeCalvalcante)[1212] organized crime family, who reminded him that though he might have "proprietary rights" the machines were owned by "the family."[1213]

    The idea of converting run down theatres in the Midwest into pornographic adult movie houses to launder cash from other illegal rackets was the brain child of Chicago organized crime figure Patsy Riccardi who was murdered in July, 1985.[1214]

    Myron and Michael Wisotsky were convicted in the United States District Court for the Southern District of Florida in late 1985, for tax evasion which arose from skimming activities at their sexually oriented bookstores.[1215]

    A bookstore operator told the Commission:

  6. Copyright Violations

    Organized crime elements involved in the production of videocassettes and movies have been known to infringe copyrights by the "pirating" of films produced by legitimate studios and the use of music or other parts of a legitimate enterprise without royalty agreements.[1217]

  7. Fraud

    Layers of corporations and hidden transactions of all descriptions are used by organized crime families involved in pornography to conceal true ownership and activities.[1218]

    Other crimes associated with organized crime involvement in obscenity include child pornography,[1219] possession, transfer and sale of machine guns and silencers,[1220] and illegal gambling.[1221]

V. Reuben Sturman

Reuben Sturman, also known as Robert Stern, Roy C. English, Robert Butler, Paul Shuster, and Paul Bekker, of Clevelaned, Ohio, Los Angeles, California, and elsewhere, is widely believed to be the largest distributor of pornography in the world.[1212] Law enforcement authorities believe that the Sturman  empire has financial control of nearly two hundred businesses in nineteen states, one Canadian province and six foreign countries.[1223] Sturman is closely associated with known organized crime family members.

James Fratianno described Sturman's connection with Robert DiBernardo, a member of the LCN Gambino (and/or de Cavalcante) Family:"... if he has a problem he goes to Debe.[1214] Sturman and DiBernardo have had a long term business relationship, "... they were partners, plus ... if Debe wanted [Sturman] to do something, he [Sturman] would do it."[1225]

More than twenty years ago Sturman was a small time candy, tobacco and comic book distributor who moved slowly into pornographic magazines.[1226] Avoiding any serious legal problems, he built the business into a mammoth operation encompassing all phases from production to retail sales with a myriad of corporate identities.

One account describes his organization as follows:

[Sturman] structured his many companies from retail stores to video production firms, in a honeycomb of nominees, false names and dead associates to avoid local obscenity prosecutions. [A 1985 tax case] reveals that the corporate structure has grown hydraheaded over the years, apparently with the more serious intent of avoiding taxes.[1227]

Sturman's influence on the pornography industry is so great because his enterprise produces a very wide range of items and distributes them to retailers through countless disguised channels.[1228] According to Los Angeles police, 580 of the 765 adult video arcade machines there are owned by companies controlled by Sturman.[1229] Police report that Sturman typically installs equipment worth $22,000 to $60,000 at no cost to the store owner.[1230] In exchange, he reaps fifty percent of the income from the peepshows.[1231] A store owner in San Diego, California, described Sturman's hold on the industry there by saying, "People are afraid of him because of his power. He could just cut people off. You could just die out there. Paranoia sets in and I'm sure he uses it to his advantage."[1232]

Over the past few years, a number of Sturman's associates and corporations have been convicted on obscenity charges and other violations of law.[1233]   Sturman, himself however, has evaded any serious consequences for his acts.[1234]

An indictment returned by a federal grand jury in Cleveland in 1985 alleged Sturman conspired to evade millions of dollars in taxes by laundering seven million dollars through foreign bank accounts and also charges that he destroyed records subpoenaed by the grand jury.[1235] One of his co-defendants, Scott Dormen, pled guilty in late 1985 to his part in the conspiracy, admitting that he skimmed money from Sturman's income and delivered at least $450,000 in cash, to Sturman that went unreported.[1236] When Sturman is the subject of prosecution,

[he] professes indignity when legally attacked-as he always is-and fights back savagely. He also covers legal fees and fines of associates and gives them bonuses when they face the consequences of arrest.[1237]

Reuben Sturman controls General Video of America (GVA), one of the largest distributors of sexually explicit video tape cassettes in the United States.[1238] GVA recently released and distributed a "White Paper" to video cassette retailers giving them notice of government action to prosecute obscenity violations. The "White Paper" also announced the creation of a legal defense fund for GVA and others involved in the distribution of such video cassettes. In addition, they offer a toll-free number for retailers to call an attorney provided by GVA to advise them on legal matters.[1239]

VI Conclusion

A local law enforcement officer told this Commission, "The industry is very difficult to investigate as a local police officer, as a business in one jurisdiction, in general, is incorporated in another jurisdiction, receives materials from another jurisdiction and is controlled by individuals in another jurisdiction. Federal law enforcement involvement is an absolute necessity to attack the real problem of organized crime influence."[1240] While no known additional organized crime families may live in a particular state, the effect of their production, distribution and sale of obscene material can be readily apparent. Another local law enforcement officer concluded, "Left unchecked, organized crime, in a traditional sense, can suck the lifeblood out of a community. Many times, their enterprises have been viewed as "service" oriented or victimless crimes. However, it tears at the moral fiber of society and through unbridled corruption, it can weaken the government."[1243]

The findings of the 1978 Federal Bureau of Investigation analysis remain essentially correct:

In conclusion, organized crime involvement in pornography ... is indeed significant, and there is an obvious national control directly, and indirectly by organized crime figures of that industry in the United States. Few pornographers can operate in the United States independently without some involvement with organized crime. Only through a well coordinated all out national effort, from the investigative and prosecutive forces can we ever hope to stem the tide of pornography. More importantly, the huge profits gathered by organized crime in this area and redirected to other lucrative forms of crime, such as narcotics and investment in legitimate business enterprises, are certainly cause for national concern, even if there is community apathy toward pornography.[1241]

Appendix One

MIPORN

The most significant federal obscenity investigation and prosecution to date arose in the Southern District of Florida. The case, initiated by local police officers, was eventually the focus of a nationwide investigation conducted by the Federal Bureau of Investigation in cooperation with the United States Department of Justice Organized Crime Strike Force. Special Attorney Marcella Cohen, at the request of this Commission, summarized the investigation and some of its results to date as follows:

The undercover FBI investigation was referred to as MIPORN, an acronym, which stood for Miami Pornography. MIPORN was a two and a half year updercover investigation into organized crime influence in the pornography industry. This investigation resulted in many indictments for interstate transportation of obscene materials and revealed other criminal activities resulting in indictments and forfeitures including but not limited to racketeering, possession and transfer of machine guns and silencers, child pornography, interstate transportation of stolen property and copyright violations. Bruce Ellavsky and Patrick Livingston[1243] were two agents of the Federal Bureau of Investigation who were assigned to the Miami Office of the FBI in September and October 1977. They were to investigate large scale producers and distributors of pornography throughout the United States. In October 1977 an undercover company was established in South Florida which was to be the basis of the operation. The name Golde Coaste Specialties, Inc., was chosen as the name of the company and it was incorporated in the State of Florida. There were a number of companies with variations of the name Gold Coast so it was necessary to put an "e" on the end of gold and "e" on the end of coast in order to incorporate in Florida. Special Agent Bruce Ellavsky used the undercover name Bruce Wakerly and Patrick Livingston used the name Pat Salamone. Additionally, an office warehouse was rented where meetings were conducted. The "front" business of the warehouse was a blue jeans store while the back of warehouse was where the pornography, business was located. At a later time, G&C Sales, Ltd., was established in the Grand Cayman Islands to lend credibility to the operation.

When the agents spoke to individuals who were involved in the distribution of pornography throughout the industry, the agents would inform them that they had a mail order operation involved in the distribution of "hard" or hard core pornographic eight millimeter films, magazines, and video tape cassettes. In reality there was of course no such mail order business.

For the purpose of the undercover operation the agents altered the manner in which they dressed. They dressed casually and wore gold necklaces, diamond rings, gold bracelets and expensive watches.

During the course of the undercover investigation the agents travelled throughout the country and met with pornographers in virtually every major city including New York, Los Angeles, San Francisco, Las Vegas, Chicago, Pittsburgh, Minneapolis and providence. The agents found that major producers and distributors of eight millimeter films, magazines and video tape cassettes would meet every six months in various cities throughout the United States. The meetings were usually not conventions with any planned agendas. They would frequently take place in a major hotel within the city, and conversations would take place in the lobby areas of the hotel, or in lounges or restaurants located off the lobbies. The agents on occasion would plan or attend a meeting which would take place in the room of whichever distributor or producer of pornography they wanted to meet with, see their products or f-urther discuss potential orders. At other times, booths would be set up at a consumer electronics show. The following are some of the individuals and, companies investigated during the course of the two and a half year undercover MIPORN investigation:

  1. Star Distributors Inc. -- Robert "Debe" DiBernardo, Theodore "Teddy" Rothstein, and Andrew "Andre" D'Apice, New York, New York.

    Star Distributors is a group of companies headquartered in New York, New York, and controlled by Robert "Debe" DiBernardo.

    DiBernardo's close business associates at Star Distributors were Theodore "Teddy" Rothstein and Andrew "Andre" D'Apice.

    In April 1978, the agents attended a pornography convention at the Fairmont Hotel in New Orleans, Louisiana. In a restaurant in that hotel, the agents were introduced to Teddy Rothstein by Rubin Gottesman of National Film Company, Los Angeles, California. Mr. Rothstein agreed to supply Golde Coaste Specialties with hardcore pornographic eight millimeter films, magazines and video tape cassettes. Rothstein said he would introduce the agents to Andre D'Apice, his eight millimeter man. Later on that same date in a hotel room at the Fairmont Hotel, the agents were involved in conversations involving the sale of films with Roger Summers and Joe Mallen of California International Distributors. Present at that meeting were Rothstein and D'Apice. D'Apice said he was a partner of Rothstein's and that they produced the film series entitled "Super Sound" and "Mustang." D'Apice stated they supplied distributors throughout the United States with these series and would also supply them-to the agents.

    On April 21 and April 22, 1978, the agents had a series of meetings at Star Distributors, 150 Lafayette Street, New York City. They first met with D'Apice who informed them that there had been some concern as to whether Golde Coaste was a front for law enforcement; however Rothstein.and Robert "Debe" DiBernardo said they had checked Golde Coaste amongst their national associates. Rothstein had confirmed with Al Tapper (now deceased) of California Publishers Liquidating Corporation that the agents were "good people" and that Tapper had dealt with them for a substantial period and not been arrested.

    During the meeting D'Apice stated that the agents "would have no problem whatsoever dealing with Mr. Rothstein or 'Debe' as long as you are one hundred per cent good people . . . but if you should cross ?Debe' there are plenty of people who would kill for him."

    Between April 24, 1978, and April 27, 1978, the agents recorded a number of telephone conversations between themselves and the principals at star Distributors concerning shipping arrangements for the films which had been ordered. The agents were informed by D'Apice which false names would be utilized as shipper and consignee.

    During the sentencing hearing on this case, November 20, 1981, the following pertinent information was provided to the Court:

    Jimmy "the Weasel" Fratianno at the time of the hearing was in the Witness Protection Program and guarded on a• twenty-four hour basis by the United States Marshal's Service. Jimmy Fratianno told Special Agent Bruce Ellavsky in his conversations with the agent in May 1980 and May 1981, that he, Fratianno, was a member and one time acting boss of the Los Angeles family of what he called La Cosa Nostra, an organized crime group in Los Angeles. During 1975, Jimmy Fratianno was a partner of Mickey Fine in a pornography operation located in Los Angeles. Initially, in 1975, when Fratianno was dealing with Mickey Fine, he wanted to obtain some money from some of the pornographers who were operating in the Los Angeles area over whom he had no control. Fratianno later learned that Reuben Sturman, a major distributor of sexually explicit material located in Cleveland, had some interest in the Los Angeles area. At that time Jimmy Fratianno spoke to Pete Milano, a capo in the Los Angeles crime family who informed him that previously he and some individuals from the Cleveland organized crime family with Ettore "Terry" Zappi, had put pressure on Reuben Sturman for money and obtained $200,000 from Sturman due to Sturman's association with various families in New York. During this conversation with Pete Milano, Fratianno told Milano that he wanted to do the same thing. Milano said in order for him to do that he would have to see Ettore "Terry" Zappi. At that point Fratianno made arrangements through Tony Randazzo, a member of the Cleveland organized crime family to make an introduction to Zappi which he did, in Florida. During their association together as partners, Fine, on several occasions, had mentioned the name "Debe" to Fratianno. Fratianno asked Mickey Fine who "Debe" was. Fine told him that as far as pornography goes, "Debe" is the main man in the country.

    During April 1976, Fratianno went to the Westchester Premier Theatre in New York to see a Frank Sinatra concert. While at the Weschester Premier Theatre he met with Ettore "Terry" Zappi, who Jimmy Fratianno knew as a capo in the Gambino crime family organized crime family in New York. When Fratianno saw Zappi there were two other people with him, one of whom was Frankie Duff, also known as Frankie D'Appolino, a Gambino member. The other person at that time was unknown to him at first. Fratianno spoke with Zappi about pornography and the fact that he wanted to get into the business to a greater extent in the Los Angeles area. During this conversation, Fratianno said to.Zappi that every time he talks about pornography in the Los Angeles area, the name "Debe" comes up. He said he hears the name constantly "Debe." Fratianno asked Zappi who "Debe" was. Zappi laughed and said "Debe" was sitting right next to him and then introduced Fratianno to Robert DiBernardo. Fratianno proceeded to talk to DiBernardo concerning the pornography business, especially pertaining to the Los Angeles area. DiBernardo told him that if he wanted to get in the business he should have done it four or five years ago. Now it was all locked up. Fratianno said that when he was introduced to DiBernardo by Zappi at that time he knew from the way he was introduced at that time DiBernardo was not a member. Zappi said that he and DiBernardo were partners in the pornography business.

    Fratianno said that during 1977 he heard from several sources that DiBernardo had been made a member of the Gambino family. There was testimony at the sentencing hearing in United States V. DiBernardo, that in November 1981, Mr. DiBernardo's car was parked in front of Paul Castellano's home in Staten Island. Several reliable sources supplied information to the Federal Bureau of Investigation that DiBernardo is a made member of the Carlo Gambino organized crime family. A source advised that DiBernardo is a big money earner in pornography in New York, Miami and other places throughont the United States and he enjoyed the privilege of reporting directly to Paul Castellano, now deceased, who was allegedly the boss of the Carlo Gambino organized crime family.

    United States v. Ralph Borello, was a federal customs cases, involving the smuggling of 771 eight millimeter films by means of false invoices. Borello allowed someone else to use his name in importing shipments of eight millimeter films. Informant information revealed that in 1981 Borello was an employee of Robert DiBernardo. Show World, a multi-faceted pornography outlet on 8th Avenue in New York City, is controlled by Robert DiBernardo. Borello himself has been involved in the pornography industry since the 1960s and maintains the machines in Show World. Borello had twenty-two prior convictions mostly stemming from obscenity related arrests. One was for bribery of a police officer in order to discover information regarding impending searches.

  2. A & A News-Anthony DeFalco and Paul Gorman, Chicago, Illinois. During a meeting at A & A News in March 1978, an agent was taken to an area in the warehouse behind a "fake" brick wall. Behind the brick wall were the eight millimeter films. In a metal cabinet behind the fake brick wall were the "animal" films depicting acts of bestiality.

    Paul Gorman said he could obtain sound projectors for Golde coaste Specialities at a very good price. He said that these projectors were often "too hot to touch" and that there might be a truck having an accident in the near future, at which time he would have several hundred projectors available.

    On March 15, 1978, in a tape recorded conversation Gorman said that Anthony DeFalco was in court today because one of the stores had been "hit", that is, searched by police. Gorman said that in the past they had almost been "hit" while a load of child pornography was still on the premises but that the police had gotten to the film room one 'day late. Gorman said they had shipped the child pornography the previous day and that the police were jerks for not grabbing the stuff earlier.

    In October 1978, the agents met with Tony DeFalco and Paul Gorman. DeFalco mentioned the fact that he had received numerous inquiries in the past several months regarding the agents and that there were rumors around the industry that the agents were "the heat." DeFalco said that the pornography business was a close knit group of individuals, with virtually everyone in the industry has known each other for many years, and that it is almost impossible for someone new to break into the business.

    DeFalco said that the hard core market was shifting from eight millimeter film to video tape cassettes. The agents told DeFalco that they had conversations with California International Distributors (CID) regarding the shipment of eight millimeter films to Miami, Florida. DeFalco was told that CID said they were on probation in Florida and would not ship hard core to Florida. DeFalco said he would handle the shipment of eight millimeter hard core film and video tape cassettes to Golde Coaste Specialties in Miami from CID in Los Angeles, California. DeFalco said the agents should contact CID, place an order and it would be shipped directly to him in Chicago, Illinois. DeFalco said that upon receiving the shipment he would immediately reship it from Chicago to Miami, Florida. DeFalco said he wanted to make a few dollars on the transaction for his trouble, but would be happy to enter into this arrangement with the agents and CID of Los Angeles, California.

    DeFalco said he had received a letter from a person "established" in the pornography business which stated in effect that anyone dealing with the agents should be wary of them being cops.

    DeFalco and the agents discussed Golde Coaste Specialities' interest in the purchase of L.W. Sales, Chicago, Illinois. DeFalco said he had never been able to get along with Leo Weintraub in the past and would prefer to have the agents running Weintraub's operation in Chicago. DeFalco said Weintraub continues to run his wholesale operation out of his warehouse on Milwaukee Avenue-but that he sold all five of his bookstores. DeFalco would not identify the individual to whom these stores were sold. DeFalco said that the peep machines were owned by another individual and said that the new owner of the stores would receive only a percentage of the earnings from the peep show operation.

  3. Imperial News - Kenneth Guarino, Anthony "Butch" DiBona and Joseph Renzi, Jr., Providence, Rhode Island. In November 1977, an undercover agent had a discussion with Guarino concerning the fact that Guarino felt that the Federal Bureau of Investigation viewed him as the kingpin of hard-core pornography. Guarino then took the agent to a "secret" room in his warehouse which he stated contained his hard-core films.

    In November 1977, the agents met with DiBona who said that he, Guarino and Renzi had to be careful of shipping to South Florida because of the "heat" from local and federal authorities. However, he said that they had "checked out" the agents and they were good people. Two shipments to Golde Coaste Specialities in Miami, Florida, from Imperial News contained fictitious names in the return address.

  4. S. and L. Distributors - Norman Arno, Thomas Sinopoli, Marty Bernback, Sandy Sarnblad, Timothy "Tim Simpson" Burns, Los Angeles, California. In May 1978, the agents met with Norman Arno, owner of S & L Distributors. Arno said he was willing to meet the agents since they had been dealing with his employee Tim Burns for over eight months and no one had been arrested. Arno said he was dealing with Rubin Gottesman (National Film Company, Los Angeles, California) regarding purchase and sale of video tape cassettes of major motion pictures. After a $3,000 check was given to Arno by Agent Ellavsky, Arno said he would send Ellavsky a "phony" invoice reflecting payment of $3,000 and would label the invoice as being for magazines or periodicals. Arno said he wanted to obtain the remaining $3,200 in.cash so he would not have to report it as income.

    In July 1978, Arno told the agents that there were rumors that they were "the heat". Arno alluded to the fact that he was suspicious that the agents were cops. Arno said the pornography industry was a close knit organization and that most individuals have been in the business several years and no one seemed to know where the agents came from.

    Arno said he did not want to take any calls concerning legitimate or "straight" video tape cassettes over his telephone at his residence or his office. He stated that arrangements could be worked out whereby he would call from a pay telephone to obtain the orders desired by Golde Coaste Specialties. Arno said he had previously been somewhat reluctant to inform the agents that he was involved in the reproduction of pirated motion pictures as this was a violation of federal copyright statutes. Arno said there were several problems connected with the production of these video tape cassettes. He said there was a lot of activity by the FBI recently and that several producers of pirated films had been "busted" in the recent past and were now working for the FBI.

    In January 1978, Arno said he had first heard problems about the agents from Ron Selinger (Bon Jay Sales, Baltimore, Maryland) and that Selinger said he was going to meet with the agents in Miami, Florida, until he received a telephone call from a friend of his advising him not to deal with the agents.

    Arno said Chicago was a rough town and that a former employee of Leo Weintraub by the name of Rene had had his operation blown up in Chicago reportedly by Weintraub.

    In January 1980, the agents met with Norman Arno at his Video Cassettes X Rated (VCX) display at the Consumer Electronics Show held at the Hilton Hotel, Las Vegas, Nevada. The agents told Arno they brought with them a check to give to him as payment on a debt. The agents and Arno went inside the VCX display. At that time Arno said that Special Agent William Kelly of the Miami, FBI Office was behind them and was about to photograph them. Arno told Ellavsky not to turn around and not to write the check at that time but to come to his hospitality suite at Ceasar's Palace where he would receive payment.

  5. Sovereign News Company - Reuben Sturman, Joe Zernic, Al Bloom, Steve Martin Assid, Cleveland, Ohio.

    In October 1978, the agents met with Joe Zernic in the lobby of the Olympic Hotel in Seattle Washington, at one of the semi-annual pornography conventions discussed earlier. Zernic said he had heard rumors about the agents being cops. Zernic said he had tried to contact the person who had introduced the agents to him without success. On January 5, 1980, the agents met with Reuben Sturman, owner of Sovereign News Company, Cleveland, Ohio. They discussed past dealings the agents had with Sovereign News. The agents mentioned they had previously dealt with Joe Zernic and had purchased eight millimeter film and magazines from him. Sturman said that Zernic was one of his key employees.

    Sturman has since been indicted on other charges relating to tax evasion.

  6. California International Distributors (CID) - Noel Bloom, Roger Summers, Joe Mallen, Roger Chan, Al Bloom, Los Angeles, California.

    In March 1978, Summers stated that his boss, Noel Bloom had problems in Florida approximately seven years ago and that he was somewhat reluctant to ship to Florida because he was under probation in that state. Summers discussed with the agents the possibility of contacting Reuben Sturman at Sovereign News, Cleveland, Ohio, to assure prompt shipment of the "Swedish Erotica" series through Sturman to the agents in Miami, Florida. Between August 1978 and March 1979, the agents had conversations with Summers and Mallen regarding the scheme of shipping "Swedish Erotica" through a third party.

  7. L and W Sales - Leo Weintraub, Chicago, Illinois.

    In March 1978, the agents dealt with Leo Weintraub, owner of L and W Sales who agreed to ship hardcore films to Miami, Florida.

  8. Le Salon Distributors - Roland Bouldreault and Larry Nelson, San Francisco, California.

    Nelson told the agents in March 1978 that he would have to check out the agents prior to shipping to Miami, Florida. Nelson asked who the agents had dealt with and the agents said A & A Distributors of Chicago, Illinois. Thereafter, Nelson placed a long distance telephone call to Tony DeFalco, main owner of A & A Distributors. After talking to DeFalco, Nelson said he would ship hard core material to Golde Coaste. Nelson said DeFalco said the agents were "good people" and that he (Nelson) trusted DeFalco completely, having dealt with him for a long period of time. The shipments were sent from Foxx Distributors, 47 Minna Place, San Francisco, California, which was a fictitious name and address.

    In July 1978, the agents discussed with Bouldreault the possibility of distributing a bondage film depicting sadomasochistic acts. Bouldreault said he was very interested and that he could possibly distribute several hundred copies of such films to his outlets in Amsterdam.

    During a sentencing hearing on June 28, 1984, the United States submitted invoices demonstrating that from 1976 through mid-1978 child pornography materials were shipped from Le Salon and a company by the name of All American Studios, San Francisco California. Among the titles was "Bare Boys", a sexuall, explicit magazine depicting boys under the age of fourteen There was testimony by William Dworin, of the Los Angeles Police Department, who stated that he knew one of the boys depicted it the magazine and that he was actually eight or nine years old when the picture was taken.

  9. Walter "Frenchy" Bagnell - leased office space at M & M Sales Distributing Corporation, Los Angeles, California.

    Bagnell stated in September 1977, that he was one of the largest distributors and producers of hard core pornography and that he specialized in "boy-boy" (homosexual) films. Bagnell said he had organized crime connections in Chicago and New York. Bagnell said he was having problems with Bon Jay Sales in Baltimore, Maryland, and that he was traveling to New York in a few days to meet with his "connection" people. They would then take a trip to Bon Jay to collect a $34,000 debt that Bon Jay owed to Bagnell for hard-core pornography that Bagnell had previously shipped to them.

    Bagnell said he was leaving Los Angeles to travel to Tulsa, Oklahoma, to drop off a large shipment of hard-core "boy-boy" film. Bagnell said Oklahoma was one of the few states to which he was reluctant to ship hard-core pornography by normal means and that he intended to deliver the film to Tulsa himself. Bagnell said he would accomplish this by placing the films on a. flight which would be leaving within an hour of his own personal flight to Tulsa, thereby having the film shipped as luggage via the airlines in a flight other than the flight he was taking. Bagnell said that this method made it impossible for law enforcement authorities to link the film to him.

  10. Wonderful World of Video - Harry Mohney and Jerry Wade, Los Angeles, California.

    An indictment charging Mohney and Wade with various violations of federal obscenity laws is set for trial in 1986.

  11. T.G.A. Associates - Theodore "Teddy" Gaswirth, Los Angeles, California.

    In September 1978, Gaswirth mentioned to the agents that there had been rumors that they were FBI agents and if they were, he would be busted sometime- in the future. Gaswirth said that the rumors were diminishing in as much as various individuals in the pornography industry believed that if they were really agents some arrests would have occurred by this time.

  12. Arrow Film and Video Co. (Arrow) - Louis "Butchie" Peraino, Joseph Peraino, Michael Balsamo, Vince DiStephano, and Arnie Himmelstein, New York, New York, and Los Angeles, California.

    Information at a sentencing hearing on January 29, 1982, and the sentencing memorandum filed in this case revealed the following:

    Joseph Peraino and Louis "Butchie" Peraino are nonmember associates of the LCN organized crime family in New York City.[1244] Louis "Butchie" Peraino, Joseph Peraino, and DeStefano are reputed to run Arrow Film and Video through the use of extortion and other strong arm tactics. DeStefano has claimed to represent the interests of several LCN family members in investments in pornographic films in Los Angeles and has claimed to have made "big money" for his New York City organized crime connections. The activities of Louis and Joseph Peraino in the pornography business were financed by the LCN organized crime family and Louis and Joseph Peraino contribute large sums of money from their business to that LCN family.

    In September 1980, Steve Ramirez operated a video lab, where he transferred films onto video tape as well as duplicated and distributed video tape cassettes. Ramirez said he was duplicating copies of the film "Deep Throat". He was approached by Louis Peraino and Vincent DiStephano who threatened him with physical harm and informed him that he was duplicating the film "Deep Throat" without their authorization. As a result of these threats, Ramirez closed his business. A substantial part of his business involved duplicating the films "Deep Throat" and "Devil in Miss Jones" for Norman Arno (S & L Distributors, Los Angeles, California). Peraino came to Ramirez because Arno had told him that Ramirez was doing the duplication.

  13. J & G Sales - Michael Zaffarano, Joseph Arieno, Bobby Zeichick and Larry Mathas, Los Angeles, California.

    In September 1979, the agents and Arieno discussed an order for the film "Debbie Does Dallas". Arieno said that the film was owned by Michael Zaffarano (now deceased and alleged to have been a member of an LCN organized crime family) but stated that Zaffarano had given Arieno permission to distribute it.. When the agent expressed doubt, Arieno said that he could call Zaffarano and verify the fact.

  14. California Publishers Liquidating Corporation - Al Tapper and Ray Hind, Los Angeles, California.

    In April 1978, during a video taped meeting with Ray Hind, Hind discussed the pornography industry and the fact that during the previous week he had three telephone calls from "people within the industry" checking on the "legitimacy" of the agents. Hind said that his boss, Al Tapper, had personally contacted him from New Orleans, Louisiana, to inquire how long Hind had known the agents. Hind said he gave the agents a good recommendation and that everything was okay.

    Hind claimed to be well known within the industry and said he was personally acquainted with Teddy Rothstein and Robert DiBernardo of Star Distributors, New York City. He said he had also received calls from "their people" checking on the agents.

  15. Discount Distributors, TVX Distributors and Atlanta Video, Phillip "Chuck" Bernstene, Anthony "Tony" Arnone, Bill Jackmore, Los Angeles, California, Fort Lauderdale, Florida.

    In a tape recorded conversation in May, 1979, Beinstene said he spoke to Mickey Zaffarano regarding "Debbie Does Dallas." Bernstene said that through Zaffarano and Joe "Black" Arieno, he. would be in a position to distribute "Debbie Does Dallas." Bernstene said that three or four years ago, Zaffarano had placed him with S & L Distributors, (Norm Arno and Tommy Sinopoli) to insure that Sinapoli and Arno made payments to Zaffarno. Berstene said that Sinapoli, Arno and S & L Distributors were tied directly to Zaffarano. Bernstene said that during the time he was with S & L Distributors he made weekly payments to Zaffarano from Arno and S & L Distributors.

    In October 1979, Bernstene described Zeichick (J & G Sales, Los Angeles, California) as a "no good guy" who had. "messed up" people in the past in some of his business dealings. Bernstene said Zeichick and Black were doing a good business and they were cutting into some of the customers of TVX Distributors.

    Bernstene said that this was hurting TVX and other distributors but he could not put pressure on Zeichick or Black due to their close relationship with Zaffarano.

    Bernstene said Zaffarano had just recently given the movie "Autobiography of a Flea" to Andre D'Apice (Star Distributors/KED New York City) to have as his movie. Bernstene said that if law enforcement officials and the IRS became aware of how much money Zaffarano made off his hard core movies, they could blow the lid off his operation.

    Bernstene said it was like when "Deep Throat" and "The Devil in Miss Jones" were playing all around the country in 1972. If it were known how much money was actually made on these movies, a lot of people would have problems. In October 1979, Bernstene said that Walter Gernert would be coming to Las Vegas. Bernstene said that he was going to Vegas to "pay the juice". Berstene said the loan was for eight millimeter films which Walter Gernert was involved with.

    Bernstene said that Angelo and Tony Farese recently came into the offices of TVX Distributors and advised him and his partner, Dave Friedman that they now controlled the movies "Deep Throat" and "Devil in Miss Jones" and that a fee of $10.00 per video tape cassette of these movies should be paid directly to the Fareses. Bernstene said that the Fareses advised him and Friedman that the Perainos no longer control the movies "Deep Throat" and "Devil in Miss Jones" and that 'the Fareses now controlled these movies.

    On November 6, 1979, Bernstene said that when Michael Wisotsky was dealing with Arno, Wisotsky was doing business in the range of $15,000 to $20,000 a month. During that time Wisotsky told Bernstene that the agents were working for the "Feds." Wisotsky told him that he had gotten this information from Andre D'Apice.

  16. Central Sales - Lou Guglielmi, Baltimore, Maryland.

    On December 20, 1978, the agents met with Guglielmi, the owner of Central Sales. Guglielmi said he had over one million dollars in projectors in the basement of Central Sales and said this was a large part of his business. Guglielmi told the agents he was part owner of Miami Books in Miami, Florida, along with Star Distributors of New York City.

    Guglielmi said he had a lot of heavy contacts in the Miami,, Florida, area and said that Bob Inman had sold out to him and then tried to steal some of his customers away. Guglielmi said that he does not take an individual like this to court to settle the matter. He said he takes it into his own hands and makes one phone call to Florida and "within ten minutes, turns a boy into a man."

  17. National Film Company - Rubin Gottesman, Barbara Gottesman, Los Angeles, California.

    In February 1979, the agents met with Rubin Gottesman and his wife Barbara Gottesman. Rubin Gottesman said he had been with Norman Arno (S & L Distributors) the previous evening and that Arno had showed him a video tape of the movie "Debbie Does Dallas." Gottesman said Arno told him that he had received the video rights to that movie from Mickey Zaffarno, the owner of the movie. Gottesman said Zaffarano had given Arno the national distribution rights for this movie and that Arno now had it available on video. When the agents asked to obtain a print of this movie for themselves Gottesman said he would not even consider doing this because he wanted to remain healthy. Gottesman said Zaffarano would not hesitate to use muscle if he believed someone was bootlegging his movies.

    On March 23, 1978 Rubin Gottesman told the agents that in the past an individual was believed to be copying and distributing various hard-core movies. He said organized crime people had put money into these films and that this individual was "hit in the head." Gottesman said that should the agents begin duplicating movies such as "Deep Throat" and "The Devil -in Miss Jones", they would have to be prepared to take the heat.

    In June 1979, Gottesman said he had gotten two movies from Joe Peraino (Arrow Films, New York and California), "Johanna" and "The Devil Inside of Me." Gottesman said both of these were Joe Peraino's movies and that he was paying Joe Peraino $300 each for the prints.

  18. Bon Jay Sales, Inc. Jack Gresser, Ron Selinger, John Moon, Alan Swartz, Baltimore, Maryland.

    On May 17, 1978, the agents went into Bon Jay Sales, Inc. There was a discussion about two pimps who worked the east coast for Jack Gresser. These pimps obtained the girls for Gresser's bookstores and massage parlor operations in the Baltimore and Washington, D.C., areas. On May 24, 1978, an employee of Bon Jay Sales, Alan Swartz, said girls could be provided to the agents on their next trip to Bon Jay Sales and that another individual at Bon Jay Sales handled the procurement of girls for customers.

    On August 10, 1978, in a telephone conversation with Jack Gresser, Gresser said that there had been rumors about the agents and he had been advised to stay away from them.

  19. M and M Video Systems, Inc., Mickey Manos, Houston, Texas.

    In July, 1979, Special Agent Bruce Ellavsky spoke to Manos about "boy-boy" (homosexual) films. Manos said that most of his business was in Tennessee and Alabama. Manos said he had a $300,000 lab when he does a lot of reproduction. He claimed to be the biggest in the videotape business outside California, Chicago and New York.

  20. Alvin Nunes, Honolulu, Hawaii.

    On December 1, 1978, Chuck Bernstene told an agent that he had access to pirated major motion pictures through a contact of his in Honolulu, Hawaii, by the name of Al Nunes. Berstene then called Nunes and made arrangements with him to meet the agent in Hawaii. Bob Courchese told the agent he had difficulties with the bookstore he had recently opened. He said he had pinball machines in the store and he had gotten pressure and muscle from the "boys" on the island. He said they had demanded a split of 70/30% with 70% going to them. Courchese said he could not live with the split and gave up the store. Courchese said he was still employed by Nunes, both at Nunes' bar and doing whatever else Nunes requested of him. Nunes gave the agent a bestiality film and said he would ship child pornography to Miami, which he subsequently did.

    A separate case in the Southern District involved Michael Wisotsky, Myron Wisotsky, Robert Barkow and Donald Work [1245] Dade, Broward, and Palm Beach Counties, Florida.

    The pornography business operated by Michael Wisotsky and his uncle Myron is the most significant one south of Atlanta, Georgia. They are considered to be key figures and upper echelon distributors of hard core pornography. At the time of the indictment in this case in 1983, Michael and Myron Wisotsky (referred to hereinafter as the Wisotskys) controlled between five hundred and seven hundred peep show machines in Southeast Florida. These machines were located in adult bookstores owned by corporations the Wisotkys controlled, as well as in independently owned bookstores. In 1983, the Wisotskys owned and controlled approximately two million dollar worth of assets through the use of nominees and sham corporations. The true ownership of these corporations was hidden to avoid the possibility of criminal prosecution. Documents show that over the course of ten years, the Wisotskys used the'names of unknowing nominees to register their corporations and caused their accountants and others to falsely subscribe these names to documents which were then mailed to the state and federal government. The investigation in this case revealed the Wisotskys owned or controlled over forty corporations. Of these, the fifteen most actively involved in the adult bookstore business were not registered under the name of either Michael or Myron Wisotsky.

    When the investigation of the Wisotskys commenced, they immediately took an active role in attempting to thwart the Grand Jury investigation conducted by the Internal Revenue Service and the Miami Strike Force. Unbeknownst to the Internal Revenue Service and the Miami Strike Force, the Fort Lauderdale Police Department was engaged in an undercover operation involving the Wisotskys during this same period of time. The Fort Lauderdale Police had placed an undercover detective in the Wisotsky organization. The prospect that the detective would be served with a federal grand jury subpoena caused the Fort Lauderdale Police to reveal his identity to Federal authorities and cooperation began between the two agencies.

    Donald Work had been the Wisotskys' key man for a number of years. One of Work's duties was to oversee and manage the peep machine operation for the Wisotskys. Numerous bookstore owners and clerks were subpoenaed to the testify before Grand Jury and each of them asserted their Fifth Amendment privilege when asked about the Wisotskys' operation.

    For a number of years, law enforcement agents attempted to locate the Braccos - a couple whose name appeared on many of the Wisotsky corporations. In March 1981, Special Agent Donald Burde of the Internal Revenue Service located them. They never had any business connections with the Wisotskys and had never heard of the corporations on whose papers their names appeared. They were in fact unknowing nominees whose names were used by the Wisotskys. After they were subpoenaed to the federal grand jury, Robert Barkow called Mrs. Bracco and said, "My people know they have wronged you they are sorry about it. They want to make up for it. Contact any of these three attorneys, they're waiting for your call. I will give you their names. We will put you up in the best hotels and consider it a vacation. My people have been wrong, they know they've wronged. You'll be well compensated for it. Take the corporations you're a,rich person.

    The Wisotskys were not content with attempting to prevent individuals from testifying against them before the Grand Jury. On August 25, 1981, Special Agent Donald Burde received a telephone call from the Wisotsky's accountant who requested Burde come to his office, "alone and unwired." During that one-on-one meeting, the accountant offered Burde a $25,000 bribe on behalf of the Wisotskys to kill the criminal tax investigation he was conducting about them.

    The evidence in this investigation revealed that the Wisotskys failed to report substantial amounts of income skimmed from the vast peep machine operation they controlled since April 1976.

At this writing, the Miami Strike Force of the United States Department of Justice's Organized Crime and Racketeering Section remains actively involved in the prosecution of individuals charged with violations of federal law as a result of MIPORN. The most recent prosecution resulted in the conviction of Norman Arno on charges of conspiracy and interstate transportation of obscene material. Arno was sentenced to five years in prison and ordered to pay a $30,000 fine.

The MIPORN investigation has yielded substantial evidence of organized crime involvement in the nationwide distribution of pornographic material, and serves as an example of effective utilization of law enforcement resources to combat the trade in obscenity.

Appendix Two

MAGLOCLEN

MAGLOCLEN is one of six federally funded Regional Information Sharing Systems (RISS program). These systems are administered by the Bureau of Justice Assistance, United States Department of Justice, and received nine point nine million dollars ($9,900,000) from Congress to fund fiscal 1986 operations. These systems cover the nation, providing support services to local, state, provincial and federal agencies investigating major criminal conspiracies. They serve over one hundred fifty thousand sworn employees in about two thousand departments. Through 1984, the projects supported cases which resulted in the seizure or recovery of nearly two billion dollars ($2,000,000,000) worth of narcotics, currency and other property.

MAGLOCLEN and its sister projects provide services to their members including access to a computerized data base on major criminals, training, investigative equipment on loan, funding for undercover operations, publications, referrals and the analysis of criminal information.

It is within the context of the latter service -- the analysis of criminal information -- that I appear before you today. One of my responsibilities at MAGLOCLEN is the work of the Analytical Unit. I developed that unit and have been responsible for its output since June of 1981.

In that capacity, I supervise analytical work, complete selected analytical products each year and provide both basic and advanced analytical training to law enforcement officers throughout our region.

In addition, I am currently co-editing the first textbook on analysis, which will be published during 1986. And, I am a Director of the International Association of Law Enforcement Intelligence Analysts, otherwise known as IALEIA, the professional organization for analysts. That organization recognized MAGLOCLEN's work during 1985 as making the "most significant progress in utilizing intelligence analytical techniques in support of law enforcement objectives."

Law enforcement analysis is the- compilation, summarization and presentation of criminal data in a form which can be understood by non-analysts. The products of such an analysis can include written reports, charts, matrices and listings which accurately convey the data and from which the meaning of the data can be derived.

MAGLOCLEN chose pornography as one of its six criminal targets when it first began, in 1981. From the onset, we were interested in the white collar crime potential which the pornography industry affords to its participants.

There were several reasons we thought white collar crime might be in evidence. Pornography and sexual aids are sold primarily for cash. Goods are sold at an enormous markup over production costs. The market for these products is large, yet relatively covert. Under these circumstances, it appeared to us that there was an atmosphere conducive to profit skimming, monopolization, using paper corporate fronts to hide actual interests, and tax evasion. Subsequent indictments alleged all of these, and more, as being perpetrated in one conspiracy which was headed by Reuben Sturman.

The analytical report titled "Reuben Sturman's Pornography Empire" included four charts, a written summary and a listing of all individuals and entities included in the charts. This work was completed in September of 1985 at the request of the Cleveland Police Department.

The report utilizes information provided by law enforcement agencies in the form of investigative reports, published documents and legal filings. It should be noted that MAGLOCLEN and the other RISS projects do not investigate cases in an operational manner, but gather data from line police agencies to perform information sharing and analytical services.

The efforts of the Internal Revenue Service and many other local and federal agencies must be commended. The paper trails and documents which they had to follow to complete such a case required a tremendous effort.

This analysis updated previous work done by MAGLOCLEN in 1984. The new material combined with previously held data as the indictment of Sturman in the case U. S. VS REUBEN STURMAN, filed June 27, 1985 and investigative data provided by agencies.

In summary, it has been alleged that Sturman has financial control of nearly two hundred businesses in nineteen states, one Canadian province and six foreign countries. That data has been transposed on to three charts which, if I may, I would like to briefly explain.

The first two charts relate to Sturman's associations. with businesses and individuals. The first chart is entitled "STURMAN ASSOCIATES". Associates are defined as either business associates, indicted or non-indicted co-conspirators, or both.

Sixty-five individuals are named in this chart as being associates of Reuben Sturman. Nearly ninety percent of these individuals have been named in a lawsuit with Sturman. Eight were named in suits against Sturman in both 1982 and 198-5. The primary associates appear on the left side of the chart. They include Ronald Braverman, James Olsafsky, Melvin Kaminsky, Marjorie Rollins, Scott A. Dormen, Paula Lawrence, Ralph L. Levine, Edward Seltzer and David Sturman.

The second chart shows "STURMAN BUSINESS ASSOCIATIONS." It breaks down one hundred and ninety six businesses into eight categories and shows their association to Sturman.. Those categories include:

  1. Companies controlled by MAGCORP, Sturman's primary company (nine companies)
  2. Companies Sturman owned through unidentified nominees (four companies)
  3. Companies Sturman owned through BLACK SHIELD, INC. as his nominee (six companies)
  4. Foreign corporations used as fronts for Sturman business activities (seventeen companies)
  5. Companies Sturman owned or controlled through WILSON & CO. as owner or shares nominee (one hundred companies)
  6. Businesses owned by Sturman in which he had or has a financial interest (sixteen companies)
  7. Foreign corporations used as fronts for specific Sturman U.S. companies (ten foreign and ten U.S. companies)
  8. Businesses that were co-defendants in a 1982 lawsuit which claimed they were controlled by him (twenty four companies)

These companies stretch, geographically, from Massachusetts to California, from Michigan to Florida. The states which include the most known Sturman-associated businesses are:

Ohio - 35 businesses
California - 24 businesses
Illinois - 15 businesses
Pennsylvania - 14 businesses
Michigan- 13 businesses
Maryland - 11 businesses
New Jersey - 10 businesses

These seven states account for sixty-two percent, or almost two-thirds, of all known locations of Sturman businesses.

Outside of the United States, Sturman related businesses have been found in the province of Ontario, in Canada (which is also, by the way, part of MAGLOCLEN's network), in Great Britain, Panama, Liberia, the Netherlands, and Lichtenstein. A sixth foreign country, Switzerland, enters the picture through bank accounts established for several Sturman associates and some of these foreign corporations in Swiss banks.

Chart three shows "TRANSFERS AMONG BUSINESSES ASSOCIATED WITH REUBEN STURMAN."

To the left on this chart, financial transactions are depicted involving INTERNATIONAL BANCORPEST, UNITED CALIFORNIA BANK offices in New York and London. On June 22, 1978 GLOBAL FILM DISTRIBUTORS ESTABLISHMENT, a Lichtenstein company, transferred fifty thousand dollars ($50,000) to a BANCORPEST office in New York.

The following day, SICORAN ESTABLISHMENT, another Lichtenstein corporation, transferred fifty nine thousand four hundred dollars ($59,400) to the New York office of BANCORPEST.

Two weeks later, on July 2, a check was written from BANCORPEST to NORTHERN PROPERTIES in the amount of fifty nine thousand three hundred dollars ($59,300). NORTHERN PROPERTIES is a Cleveland, Ohio, company alleged to be owned by WILSON & COMPANY as nominee for Sturman. The president of the company was Charles King and the vice president was Marjorie Rollins, long time personal secretary to Sturman.

On July 28, 1978, NORTHERN PROPERTIES paid sixty-three thousand eight hundred dollars ($83,800) to the Cleveland Federal Savings bank for the purchase of 3021 Attleboro Road, Shaker Heights Ohio, the personal residence of Reuben Sturman. NORTHERN PROPERTIES and Sturman further executed a mortgage for one hundred and thirty thousand dollars ($130,000) for the property also on that date.

Between September 1975 and July of 1978, Sturman associates deposited three hundred and eleven thousand dollars ($31,000) in cash into the INTERNATIONAL BANCORPEST, UNITED CALIFORNIA BANK office in London, England.

Ronald Braverman, using the name of "John Hastings," delivered ninety five thousand dollars ($95,000) in U.S. currency to this bank on September 30, 1975. On May 8, 1978, he used the name "John Hayes" and delivered eighteen thousand dollars ($18,000) in currency to this branch of the bank.

Edward Seltzer, another Sturman associate, was also a courier. Using the name "Morton Weiss," Seltzer delivered one hundred fifteen thousand dollars ($115,000) in currency to the London office of the UNITED CALIFORNIA BANK on April 5, 1978. And, on July 19 of that year, using the name of "Ralph Seltzer," he delivered eighty three thousand dollars ($83,000) in currency to the bank branch. In total, four hundred twenty thousand and four hundred dollars ($420,400) was shown as transferred or deposited into this bank by Sturman associates.

During 1977, NORTHERN PROPERTIES was again used to purchase property for the Sturmans. On April 1, 1977, David Sturman and NORTHERN agreed to buy a single family home at 12908 Westchester Trail, Chesterland, Ohio, for ninety three thousand dollars ($93,000).

On April 27, 1977, NORTHERN, Reuben Sturman and David Sturman executed a mortgage note for the amount of fifty thousand dollars ($50,000), presumably for the house on Westchester Trail. On June 17, 1977, forty three thousand four hundred and fifty dollars ($43,450) was wire transferred from FABRICORA ESTABLISHMENT, alleged to be a Sturman corporate front, to NORTHERN PROPERTIES. FABRICORA is a Panama corporation begun in 1975 by Swiss attorney Jorg Haemmerli.

FABRICORA was also used, it is seen on the chart, to transfer funds into a United Kingdom corporation, STONEREALM, LTD. On August 9, 1979, FABRICORA transferred eighty thousand dollars ($80,000) to STONEREALM.

STONEREALM was incorporated on May 10, 1975. Less than one month later, Ronald Braverman, long time employee and associate of Reubenn Sturman, applied to transfer a total of fifty thousand pounds (L50,000) into STONEREALM.

Forty five thousand (45,000) was to be a loan and five thousand pounds (L5,000) was listed as an investment. STONEREALM's 1977 corporate filing showed Braverman as owning fifty percent of the company's stock.

STONEREALM also received financial support from a third Sturman related source -- the Societe Financiere et Commerciale, S.A., a Liberian corporation. On December 5, 1978, the Societe transferred sixty thousand dollars ($80,000) to Barclay's Bank in London for credit to STONEREALM's account. And later, on April 17, 1980, Reuben Sturman, using the alias of "Robert Stern," issued a check to STONEREALM from the SOCIETE for fifty five thousand dollars ($55,000).

In total, the indictment documented STONEREALM's receipt of one hundred ninety five thousand dollars ($195,000) plus fifty thousand pounds (L50,000) from Sturman related entities.

The SOCIETE FINANCIERE ET COMMERCIALE was incorporated in 1978 by three individuals who then transferred their shares of stock to David A. Sturman, Reuben Sturman's son and business associate. When the corporation's Swiss bank account was opened, David A. Sturman, Ronald Braverman and "Robert Stern" (Reubeg Sturman) were signators.

On August 28, 1979, a five hundred thousand dollar ($500,000) check from the Weissbard & Fields Trust account in Washington, D.C. was deposited into the SOCIETE account.

On September 12, 1979, two cashier's checks written on the Superior Savings Association in Cleveland totalling one hundred and nine thousand dollars ($109,000) were deposited in the Swiss SOCIETE account.

Between November 8, 1980, and January 7, 1981, seven checks totalling thirty five thousand dollars ($35,000) and signed by "Robert Stern" were deposited into the account. Most were written on accounts in two Ohio savings banks.

The total of deposits shown as going to the SOCIETE account were six hundred forty four thousand dollars ($644,000). On the debit side, in addition to its support of Braverman's STONEREALM, SOCIETE funneled dollars to several businesses including MARCHE MANUFACTURING in North Hollywood, California. MARCHE, also known as DOC JOHNSON'S or LOVELAY Co., specializes in sexual paraphernalia. It was named as a co-defendant in the 1982 lawsuit against Sturman and his companies. A check for fifty thousand dollars ($50,000) was written on the SOCIETE account for MARCHE on September 7, 1978.

The SOCIETE's Swiss account also showed six transfers of funds to "JOE P. ENTERPRISES" totalling four hundred thousand dollars ($400,000). These transfers occurred between June 15, 1981 and March 12, 1982. The location and identity of JOE P. ENTERPRISES was not revealed in the indictment. This company, however, also received a check for fifty thousand dollars ($50,000) from MASGRO FILM INTERNATIONAL on October 7, 1981. MASGRO is a Panamanian company incorporated during 1975.

Additionally, on September 8, 1981, "Robert Stern" signed two checks totalling nineteen thousand nine hundred and ninety seven dollars ($19,997) which were deposited in the MASGRO Swiss bank account.

The inference which can be drawn from these transfers is that there was an intent to cover audit trails, launder funds and hide participation by Sturman and his cohorts in various transactions and companies.

Yet these examples form only a portion of the questionable activities uncovered to date by local, state and federal investigators in relation to Sturman corporations. The IRS alleges that for the five years between 1978 and 1982, Sturman had a personal income of three million three hundred ninety nine thousand seven hundred and thirty four dollars ($3,399,734), or an average income of six hundred seventy nine thousand, nine• hundred and forty six dollars and eighty cents ($879,948.80) per year.

Over that same period, he claimed an income of only three hundred sixty three thousand six hundred and nine dollars ($383,809), which represents about ten point five percent (10.5%) of his total income as uncovered by IRS. During those years, he paid one hundred thirty seven thousand seven hundred and forty five dollars ($137,745) in income taxes. The IRS contends that he evaded over ono point six million dollars ($1,600,000) in taxes.

And, this figure could well be just the tip of the iceberg. If his personal taxes were underreported, what of his corporate tax liabilities for dozens of businesses? Indeed, it may take a platoon of investigators, analysts and accountants to find the ?bottom line' in Sturman's business dealings.

But the Sturman case has import beyond his personal empire or his tax bill. Through his manipulations, we can see how white collar crime can work in the pornography industry and in other settings. The analytical product "REUBEN STURMAN'S PORNOGRAPHY EMPIRE" was not completed to merely summarize a complicated case. It was done to show law enforcement investigators what types of white collar criminal activity has occurred and may recur.

Further, it was done to disseminate to law enforcement agencies the identification data of individuals and entities included in the analysis. By having this data, law enforcement agencies may be able to ascertain the connections between their local pornography industry and this massive conspiracy.

Analysis and information sharing are the bases of the RISS projects. We believe that collecting, compiling, analyzing and sharing this type of information will make law enforcement, nationwide, more effective in their anti-crime efforts. Our projects were designed and funded to do this work and, with the support of the Congress, we will continue to do so.

Again, we thank you for the opportunity to testify at these hearings.

Appendix Three

The Annual Report to the Legislature

Organized Crime in California 1984

John K. Van De Kamp, Attorney General
California Department of Justice
4949 Broadway
Sacremento, California

Pornography

In early 1970, elements of the Colombo, Bonanno, Gambino, and DeCavalcante crime families moved from the East and established pornography operations in California.

During the mid-1970's, they engaged in extortion and violence in an attempt to gain control over independent pornographers in California. The Southern California Crime Family was also involved in this activity (see FOREX, page 25). Organized crime elements are now established in national distribution and are involved in most aspects of the pornography business. They continue to exert much influence over the pornography operation in California through hidden interests in this industry.

The arrival of home video cassette recorders on the market in 1979 was accompanied by a growing demand for adult video tapes. California pornographers, linked to Gambino, DeCavalcante, Luchese, and Colombo organized crime families, have entered this market through companies that produce, duplicate, distribute, and sell adult video tapes.

Appendix Four

Organized Crime's Involvement in the Pornography Industry
Report Prepared By: Investigative Services Division
Metropolitan Police Department
Washington, D.C.
November, 1978.

Introduced into the Record of Hearings Before:
New York Select Committee on Crime
1001 State Office Building
270 Broadway
New York, New York 10007
July 26, 1982

Contents

  1. Foreword
  2. Previous and Current Laws Effecting U.s. Pornography
  3. Pornography Investigation
    1. Production/distribution
      1. National Distribution (Chart A)
      2. California Production/distribution (Chart B)
    2. Individual Corporate Organizational Profiles
      1. Corporate Organizational Profile #1 (Chart C)
      2. Corporate Organizational Profile #2 (Chart D)]
      3. Corporate Organizational Profile #3 (Chart E)
      4. Corporate Organizational Profile #4 (Chart P)
      5. Corporate Organizational Profile #5 (Chart G)
      6. Corporate Organizational Profile #6 (Chart H)
      7. Synopsis (Chart I Links Charts C thru H)
      8. Corporate Organizational Profile #7 (Chart J)
      9. Corporate Organizational Profile #8 (Chart K)
      10. Synopsis (Chart L Links Charts J & K)
      11. Corporate Organizational Profile #9 (Chart M)
      12. Synopsis (Chart N Links Charts C thru M)
  4. Organized Crime Involvement (Other than Corporate Organizational Profiles)
    1. Corporate Organizational Profile #10 (Chart O)
    2. Synopsis (Chart P)
  5. Conclusion
  6. Recommendations
  7. Appendix

This report constitutes a continuing law enforcement investigation. It is not to be distributed or disseminated unless express permission is first obtained from the respective agency(s). It is further directed that this report be safeguarded as with any other sensitive investigative file. This report has only been furnished to those agencies involved who have contributed to the information gathered.

  1. Foreword

    In March, 1977, a meeting of the Combined Law Enforcement Intelligence Group (CLEIG) determined that there was a critical need for law enforcement agencies to discuss the growing nationwide problem of the pornography industry and to determine the extent to which organized crime controlled or influenced the industry. As a result of this meeting, the Metropolitan Police Department, Washington, D.C., hosted a conference on June 30, 1977, to examine this problem.

    The following goals were established by the conference's participants: 1. Identify the major producers and/or distributors of pornographic material. 2. Identify organized crime figures who are involved in the pornography industry. 3. Establish liaison between local, state and federal law enforcement agencies for the exchange of information concerning organized crime end the pornography industry. 4. Establish a central point where all information will be forwarded for correlation, analysis and eventual dissemination to all participating agencies.

    Each participant supplied documented information on pornography operations in their respective jurisdiction. This material identified the major producers and/or distributors of pornographic material and their corporate structures.

    This information provides an in-depth picture of pornography operations from the national to the local level. Since the pornography industry is constantly undergoing corporate changes, the contents of this report are to be regarded as investigative leads. Corrections and updating of the material should be completed by the recipient agency.

    Although the information was collated and analyzed by the organized Crime Branch, Metropolitan Police Department, Washington, D.C., this report obviously would not have been possible without the cooperation of the following law enforcement agencies:

    ARIZONA:
    Phoenix Police Department, Phoenix

    CALIFORNIA:
    California Department of Justice, Sacramento
    Los Angeles County Sheriff's Department
    San Francisco Police Department, San Francisco

    CANADA:
    Royal Canadian Mounted Police

    DELAWARE:
    Delaware State Police, Odessa

    DISTRICT OF COLUMBIA:
    Alcohol, Tobacco & Firearms, Washington Field Office
    Federal Bureau of Investigation, Washington Field Office
    Internal Revenue Service, Washington, D.C.
    Metropolitan Police Department, Washington, D.C.
    United States Attorney's Office, Washington, D.C.
    United States Customs, Washington, D.C.
    United States Department of Justice, Washington, D.C.
    United States Postal Service, Washington, D.C.

    FLORIDA:
    Dade County Public Safety Department, Miami
    Florida Department of Criminal Law Enforcement, Tallahassee
    Fort Lauderdale Police Department, Fort Lauderdale
    Tampa Police Department, Tampa
    Titusville Police Department, Titusville

    GEORGIA:
    Athens Police Department, Athens
    Atlanta Police Department, Atlanta
    Columbus Police Department, Columbus
    Georgia Bureau of Investigation, Atlanta

    LOUISIANA:
    New Orleans Police Department, New Orleans

    MARYLAND:
    Anne Arundel County Police Department, Millersville
    Baltimore City Police Department, Baltimore
    Howard County Police Department, Annapolis
    Maryland State Police, Pikesville
    Montgomery County Police Department, Rockville
    Ocean City Police Department, Ocean City
    Prince George's County Police Department, Forestville

    MASSACHUSETTS:
    Boston Police Department, Boston
    Massachusetts State Police, Boston
    Springfield Police Department, Springfield

    MICHIGAN:
    Lansing Police Department, Lansing
    Michigan Department of the Attorney General, Lansing
    Wayne County Sheriff's Department, Detroit

    MINNESOTA:
    Minneapolis Police Department, Minneapolis

    MISSOURI:
    Saint Louis Metropolitan Police, St. Louis

    NEW HAMPSHIRE:
    Manchester Police Department, Manchester

    NEW JERSEY
    New Jersey State Commission of Investigation, Trenton
    New Jersey State Police, West Trenton

    NEW YORK:
    Buffalo Police Department, Buffalo
    New York City Police Department, New York City
    New York State Police, Albany
    New York State Select Committee on Crime, New York City

    NORTH CAROLINA:
    Fayettesville Police Department, Fayettesville
    Greensboro Police Department, Greensboro
    North Carolina State Bureau of Investigation, Raleigh

    OHIO:
    Cleveland Police Department, Cleveland
    Dayton Police Department, Dayton

    PENNSYLVANIA:
    Pennsylvania Crime Commission, Harrisburg
    Pennsylvania State Police, Harrisburg
    Philadelphia Police Department, Philadelphia

    VIRGINIA:
    Alexandria Police Department, Alexandria
    Arlington County Police Department, Arlington
    Fairfax County Police Department, Fairfax
    Richmond Police Department, Richmond
    Virginia State Police, Richmond

    WASHINGTON:
    Seattle Police Department, Seattle Washington State Patrol, Seattle

    During the course of this investigation, efforts of the contributing law enforcement agencies have led to the identification of nationwide pornography distributors. The following pages will depict the national distribution flow of pornographic material, the major distributors at the interstate level and the corporate organizational profiles of these major distributors. Information has been derived from corporate records, occupancy permits, retail sales applications, state taxation assessments, etc. Also included are past indictments and/or convictions of individuals involved in the pornography industry.

  2. Previous and Current Laws Effecting U.S. Pornography

    Before addressing the current status 'of court rulings involving the issue of pornography, it is necessary to provide a brief background regarding the philosophical and historical evolution of our present law. It should be pointed out that this portion of the report is designed to provide a workable insight for the average law enforcement officer into the historical development of laws governing pornography.

    The crime of creating or distributing "obscene" sexual materials is of relatively recent origin in American law. Royal censorship began in England in 1531 through a licensing system under secular authority with ecclesiastics as licensers established by Henry VIII. English censorship at that time Was not directed toward sexual content; but rather, it was directed against seditious and heretical works. There was a brief period between 1605 and 1660 in which the strong influence of Puritanism in England led to authorization of proceedings against the use of profanity by actors on stage. However, after the Restoration in 1660, licensing was again limited to suppressing sedition and heresy in printed works.

    The first case which demonstrated that the common law courts would, even in the absence of a statute, penalize conduct which is grossly offensive to the public occurred in 1663 in the case of King v. Sedley. Sir Charles Sedley and two friends became drunk at a tavern. They climbed to the balcony of the tavern and removed their clothes. Sedley gave a speech which included profanities. He also poured bottles of urine on his audience and a riot ensued. Although the case did not concern the distribution of sexual materials, it involved both a physical assault j upon others and the public broadcasting of profanity and nudity upon unwilling recipients. Sedley was given a substantial fine and committed to jail for a week. This case was subsequently deemed an obscenity case when the issues involved were later cited in rulings concerning obscenity.

    In 1695, when the Licensing Act expired, Parliament declined to renew it. This apparently was not because Parliament disapproved of the practice of licensing; but rather because it considered the act unenforceable. The end of the licensing System made it likely that some new legal controls over writings would develop, at least for areas such as libel which were suddenly, for the most part, unregulated. Though the licensers had not directed their attention toward obscenity, the existence of a licensing plan probably had some inhibiting effect on pornographic publications. In any case, the demise of the system, coupled with the spread of literacy and the increased popularity of reading, gradually led to a new class of writers. The upper classes became concerned about the possible effects of these writings. It is in this setting that the effort was made to control obscenity through the common law courts.

    In 1708, in the case of Queen v. Read, a prosecution was instituted against a book entitled "The Fifteen Plagues of a Maidenhead". Read was acquitted when the court ruled "a crime that shakes religion, as profaneness on the stage, etc., is indictable; but writing an obscene book, as that entitled, ?The Fifteen Plagues of a Maidenhead', is not indictable, but punishable only in the spiritual court". This case asserted that obscenity, if it was an offense at all, was within the exclusive jurisdiction of the ecclesiastical courts. It was not an offense at common law and all penalties imposed were spiritual ones.

    Not only obscenity but sex offenses in general had traditionally been under the exclusive jurisdiction of the ecclesiastical courts. Adultery and fornication, which were forbidden by the Bible, were civilly punished for the first time under the theocratic government of Cromwell, but during the Restoration they again fell under the exclusive control of the ecclesiastical authorities.

    The next case of significance was the 1727 Curl case. Edmund Curl was prosecuted for "obscene libel" for publishing a book entitled "Venus in Cloister" or "The Nun in her Smock". The judges were troubled by the Read decision and by the fact that common law had not recognized as crimes acts which did not outright attack the church, government or tend to a breach of the peace. Curl's book, while not in direct violation of these issues, did cause an embarrassment of the Church by discussing sex of its members. Counsel for Curl attempted to use the Read case to have the indictment quashed; but the Attorney General, while admitting the lack of precedent for his position, argued that acts should be considered disruptive of the King's peace and therefore forbidden by common law. The government argued that acts which corrupt the morality of the publicc at large are "against the peace of the King's" even though acts of immorality that effect only individuals, such as fornication, are not- public offenses punishable by common law.

    The court found precedent for the conviction of Curl in the Sedley case by saying that Sedley was not distinguishable because of the showering of the public with urine and because of the violence which had provoked. The court reasoned that the more important part of Sedley's offense was his nakedness. The court held it to be an offense properly within its jurisdiction, for it said that religion was part of common law; and therefore, whatever is an offense against religion is evidently an offense against common law. They reasoned that morality is the fundamental part of religion; and therefore, whatever strikes against religion must for the same reason be an offense against common law. The Taylor case, cited as an authority for the proposition that offenses against morality are common law offenses, was a case where the defendant had been convicted for calling Christ a bastard and a whoremonger and because he called religion a cheat.

    Curl's case established that a person could be punished by common law as a violator of the King's peace (although no force or threat of violence was involved in the action). As illustrated earlier, the law before Curl punished authors of publications that were seditious or heretical or which tended to provoke an actual breach of peace. Curl added to the category of punishable works those which directly discredited established religion or its servants in written form.

    Eighteenth century legal writers treated the offense of obscene libel created by Curl as an offense against God. The obscenity cases which followed Curl similarly limited themselves to sexual material in the context of anti-religious works. In fact, material often referred to today as hardcore pornography circulated quite freely, because of the lack of anti-religious content.

    A final case that sheds some light on the development of common law offense of obscenity is the 1809 case of Rex v Crunden. In that case the defendant was charged with bathing nude in the sight of homes. The court found the defendant guilty of the crime charged but freed him since this was "the first prosecution, of this sort in modern times". Until then, immorality and immodesty, apart from anti-religious behavior or seditious behavior or behavior provoking violence, had not been punished.

    During this period "guardians" of public morals made their appearance and stimulated governments to suppress obscene writings. It was within this framework that the Society for the Suppression of Vice was founded in England in 1802.

    During the 19th century obscenity laws were given content in England. Near the beginning of the century, common law had to a point where it was being applied to prohibit purely sexual works which did not attack or libel religious institutions. This practice led to the first obscenity legislation in England and was incorporated in Vagrancy Act of 1824. The act prohibited exposing an obscene book or print in public places. In 1857 the Lord Campbell's Act was passed and it prohibited the dissemination of obscenity. This act permitted attacks on material that currently was considered to have a literary value.

    A definition of obscenity was formulated in 1868 in Queen v. Hicklin. The case involved an anti-religious pamphlet entitled "The Confessional Unmasked", showing the depravity of the Roman priesthood, the iniquity of the confessional and the questions put to females in confession. A local magistrate, Justice Benjamin Hicklin, ordered the pamphlet seized and destroyed; although about half of the pamphlet was argumentative and not obscene. In Magistrate Hicklin's view, the publication discussed intercourse and fellatio among other topics. Therefore, it rendered the entire work taboo. Although Hicklin's action was reversed by an intermediate court, but the case was appealed, and in 1868 the Chief Justice, Sir Alexander Cockburn, reinstated Hicklin's orders. In doing so, a test of obscenity was framed in law.

    The test of obscenity laid down by the court did not, however, limit itself to the anti-religious aspect; instead, a general test of obscenity was adopted. .Chief Justice Cockburn did not base the existence of obscenity on the intention of the authors. Instead, he said that the test of obscenity was whether the tendency of the matter charged as obscenity was to deprave and corrupt minds which are open to such immoral influences and into whose hands the publication may fall. The test.of morality was what a father could read aloud in his own home.

    There were many successful prosecutions of pornography and the law was also invoked against works of literary merit and works with a social or moral purpose. In addition to prosecutions, other sanctions were also used. (Seizure of books by the post office, customs officials, or police; and their subsequent destruction).

    The law was subject to continuous attack, because for it was felt that it often compelled authors to falsify social realities. The law was also attacked for reducing literary standards to the level of what was morally proper for the young. The applicatio, of the law by judges in specific cases was also attacked, because judges permitted prosecutions on the basis of isolated passages. Judges also refused to permit evidence of the author's intent or purpose or his literary reputation, or testimony of recognized literary critics. The law was also attacked because the prosecutions were often directed against book material sellers who were indifferent to the fate of the attacked.

    In the United States "obscenity" never had strong roots as a common law offense. The reasons offered are that early colonists were unconcerned with depiction of sex largely because there was little or none in circulation. The life of a typical colonist during this period was one of hard physical labor. Therefore, the general disinterest in pornography may be attributable to a lack of leisure time. In the Massachusetts colony a fundamental interest was to uphold the religious faith. From the beginning of its existence, the colonial authorities freely dispensed punishment for such religious crimes as swearing and working on Sunday, and until the late 1600's, punishment for blasphemy included the death penalty.

    As in England, censorship in America was directed toward antireligious works rather than sexual material. A statute passed in Massachusetts in 1711 read that "evil communication, wicked, profane, impure, filthy and obscene songs, composures, writings or prints do corrupt the mind and are incentives to all manner of impieties and debaucheries, more especially when digested, composed or uttered in imitation or in mimicking or preaching, or any other part of divine worship". Further, the law, prohibited the "composing, writing, printing, or publishing of any filthy, obscene or profane song, pamphlet, libel or mock sermon, in imitation of preaching, or any other part of divine worship". This statute, although closely related to antireligious material, was applicable to solely sexual material as well. There are, however, no recorded prosecutions under the Massachusetts statute until the 1821 "Fanny Hill" case.

    in 1821, Massachusetts prosecuted the first case involving an illustrated book "Fanny Hill". Prosecution of the case, Commonwealth v. Holmes, was brought against the publisher, Peter Holmes, and resulted in his conviction based upon an illustration in the book and the text. This prosecution involved common law because the illustrations were not prohibited by the statute.

    The first obscenity case in the United States arose in 1815 in Pennsylvania, where there was no obscenity statute in existence. The case, Commonwealth v. Sharpless, involved the showing of a picture movie, although not in public for profit, charged as being "lewd, wicked, scandalous, infamous, and obscene, representing a man in an obscene, impudent, and indecent, posture with a woman, to the manifest corruption and subversion of youth, and other citizens of this commonwealth, to the evil example of all others in like case offending, and against the place and dignity of the Commonwealth of Pennsylvania." The indictment also charged that defendants were guilty of "designing, contriving and intending the morals, as well of youth and other citizens of this commonwealth, to debauch and corrupt, and to raise and create in their minds inordinate and lustful desires." The defendants argued, as had Read and Curl, that they could not be convicted of such a crime without any statute prohibiting their conduct. The court found, however, that the defendants had violated public decency and thereby committed a legal offense. The court relied on the Sedley case in reaching its conclusion that acts of public indecency were indictable under common law.

    Henceforth, it was legislature rather than common law court decisions that headed the anti-obscenity movement in this country. In 1821, the State of Vermont passed the first obscenity statute in the United States., In 1834, Connecticut followed with a statute and in 1835, Massachusetts amended its colonial law to extend the ban on obscenity to importation and distribution and included prints, pictures, figures and descriptions. The updated statute was not as religiously affiliated as the old one and a test of obscenity was included for the first time. This test was whether the work is "manifestly tending to the corruption of the morals of youth."

    The first federal anti-obscenity statute was passed in 1842. It was a customs law aimed at the narrow problem of importing obscene material. The law directed the seizure and destruction "of all indecent and obscene prints, painting, lithographs, engravings and transparencies"; and like the English customs statute, was apparently aimed at the French postcard trade.

    In 1868, Anthony Comstock, a grocery store clerk in New York City, took it upon himself to investigate and report to prosecutors violations of the recently enacted legislation prohibiting the dissemination of obscene literature. Comstock was supported by community's Protestant leaders and members of the Young Men's Christian Association. Both groups had supported the creation of obscenity legislation. In 1873 the Committee for the Suppression of Vice was created in New York City. Comstock was the committee's chief Washington lobbyist and as a result of Comstock's efforts, Congress broadened the 1865 Federal Mail Act to include pornography.

    By the end of the 19th century, at least 30 states had some form of prohibition on the dissemination of "obscene" materials. The definition of "obscene," used in federal and states prohibition on the dissemination of obscene materials was the definition reached in the Queen v. Hicklin case in 1868. This definition remained in force until a 1957 decision by the United States Supreme Court set the pattern under which we enforce obscenity matters today. Before addressing this particular decision, a brief presentation of case law development affecting the area of censorship is in order.

    In the 1920's a case came before the Supreme Court involving measures designed to restrict freedom of publication. A weekly "hate sheet" that regularly excoriated the Jews was being turned out in Minneapolis by J.M. Near. The case dealt with the right of the municipal officials to suppress the publication. The high court, in a five to four decision, ruled against all prior restraints which. had been imposed on the paper.

    New York had a statute directed against sadistic literature, which read as follows: "It is a misdemeanor to sell any publication principally made up of criminal news, police reports, or accounts of criminal deeds, or pictures or stories of deeds of bloodshed, lust or crime". In-1941 Murray Winters was found guilty of possessing more than two thousand copies of a magazine titled "Headquarters Detectives". The magazine featured articles with titles such as "Bargains in Bodies", "Girl Slave to a Love Cult" and "Girls Reformatory." In 1948 the Supreme Court, in a six to three decision, reversed the conviction ruling that restrictions imposed on freedom of expression were void if the law was vague and-uncertain.

    The Esquire magazine of the 1940's was similar to today's Playboy. Sex tended to dominate a number of its stories and articles; however, it was not deemed obscene. The Postmaster General reasoned that second class mailing privileges were intended by Congress to be provided for magazines "published for the dissemination of information of a public character, or devoted to literature, the sciences, arts or some special industry." With this thought in mind the Postmaster General suspended Esquire's second class mailing privileges. The impact of the high court's ruling was to declare that an item was not censorable solely because it failed to "contribute to the public Good and the public welfare."

    In 1957 the Supreme Court reversed the Michigan conviction of a book distributor, Alfred E.. Butler, who had been convicted of selling a novel titled "Devil Rides Outside". The book detailed the moral story of a young man's struggle against lust while staying in a French monastary. The Michigan court ruled that the book violated a state statute that had barred sales to the general public of books "containing obscene, immoral, lewd or lascivious language." Supreme Court Justice Felix Frankfurter wrote: "The State insists that, by thus quarantining the general reading public against books not too rugged for grown man and women in order to shield juvenile innocence, it is exercising its power to promote the general welfare. Surely, this is to burn the house to roast the pig. We have before us legislation not reasonably restricted to the evil with which it is said to deal. The incidence of this enactment is to reduce the adult population of Michigan to reading what is fit for children."

    In Roth v. United States, 35 U.S. 476 (1957), the defendant, who published and sold books, was charged with violation of the federal obscenity statute. In a companion case, Alberts v. California, 354 U.S. 476 (1957), the defendant, Alberts, conducted a mail order business in the State of California. He was also charged with.violation of the State's obscenity laws for selling obscene, lewd, and indecent books. For the first time a constitutional issue involving the First and Fourteenth Amendments was raised. The decision centered on whether these obscenity laws violated the First Amendment's freedom of speech, and the due process clause of the Fourteenth Amendment. The defendant argued that the wording of the respective statutes did not provide reasonable definite standards of guilt so that people could understand and conform their conduct to the requirements of the laws.

    The Court held that the statutes were constitutional; and that obscenity laws designed to protect the morals of the people do not infringe on the area of protected speech or expression under the First Amendment. Also, that the wording of the statutes gave adequate warning of the types of conduct which was prohibited.

    The Roth formulation, at first glance, may not seem difficult. The five Justices declared that if "to the average person, applying contemporary community standards, the dominant theme of the material taken as a whole appeals to the prurient interest" the matter. was obscene. Thus, the Court established the broad rule that obscenity was not constitutionally protected. However, in later case the problem become one of defining the terms: "average person," "community standards," "prurient interests" and "dominant theme."

    Nine years later in Memoirs v. Massachusetts, 383 U.S. 413 (1966), the Court held: "The Supreme Judicial Court erred, in holding that a book need not be *unqualifiedly worthless before it can be deemed obscene'. A book cannot be proscribed unless it is found to be utterly without redeeming social value." While Roth presumed "obscenity" to be "utterly without redeeming social value," Memoirs required that to prove obscenity it must be affirmatively established that the material is "utterly without redeeming social value." Therefore, even as they repeated the words of the Roth decision, the Memoirs plurality produced a drastically altered test that called on the prosecution to prove that the material was "utterly without redeeming social value" a burden extremely difficult to discharge under our standards of proof.

    In the case of Paris Adult Theater v. Slaton, 413 U.S. 49 (1973), the Court said that even though obscene materials are shown' only to consenting adults, the state has a right to challenge such materials and, if found to be offensive, to prevent their sale and distribution. The United States v. Orito, 413 U.S. 139 (1973) case was decided the same day the Supreme Court held that Congress has the power to prevent obscene material from entering the stream of commerce. The Court held that the 1969 Stanley case, which protected the right of people to keep obscene materials in the privacy of their homes, did not extend beyond the home. Therefore, although a person can have such material at home, it appears he or she could have difficulty transporting it there. Another significant 1973 case dealing with the definition of obscenity was Kaplan v. California, 413 U.5. 115 (1973). The Court simply said that books without pictures can be obscene.

    The most important of the 1973 decisions was the Miller case, which resulted in the Court's setting guidelines for the term "obscenity." In Miller v. California, 413 U.S. 15 (1973) the Court stated: "The basic guidelines for the trier of fact must be: (a) whether the average person, applying contemporary community standards, would find that the work, taken as a whole, appeals to the prurient interest, (b) whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law, and (c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value." The Court set forth the following examples of what a state statute could define for regulation under part (b) of the standard set forth above: (a) patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated, and (b) patently offensive representations or descriptions of masturbation, excretory functions and lewd exhibition of the genitals.

    Also, similar federal guidelines were set down in the United States v. 12 200 Ft. Reels of Super 8mm Film, 413 U.S. 123 (1973). The Court stated that for purposes of the federal statutes the court was prepared to construe prong (b) of the test to encompass the conduct set forth as examples in the miller case. Therefore, a proper statement of the test for obscenity in federal cases would be as follows: (a) whether the average person, applying contemporary standards, would find that the work, taken as a whole, appeals to the prurient interest; (b) whether the work depicts or describes, in a patently offensive way, sexual conduct including, but not limited to, representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated, or representations or descriptions of masturbation, excretory functions, or lewd exhibition of the genitals, and (c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value.

    The most recent Supreme Court decision regarding obscenity was the William Pinkus, dba "Rosslyn News Company" and Kamera v. United States decided on May 23, 1978. This case established guidelines for a definition of the "community" by whose standards obscenity was to be judged, the court held that children are not to be included as part of the "community" as that term relates to the "obscene materials" proscribed by 18 U.S.C. S1461, and hence it was error to instruct the jury that children are part of the relevant community. A jury conscientiously striving to define such community, the "average person" by whose standards obscenity is to be judged, might very well reach a much lower "average" when children are part of that equation than it would if it restricted its consideration to the effect of allegedly obscene materials on adults. However, inclusion of "sensitive persons" in the charge advising the jury of whom the community consists was not an error. In the context of this case, the community includes all adults who compose it, and a jury can consider the, all in determining the relevant community standards. Nothing prevents a court from giving an instruction on prurient appeal to juries as part of an instruction pertaining to appeal to the average person.

    The pandering instruction, which permitted the jury to consider the touting descriptions in the advertising brochures, along with the materials themselves, to determine whether the materials were intended to appeal to the recipient's prurient interest or, whether they were "commercial exploitation of erotica-solely for the sake of their prurient appeal. The tracing of these rulings clearly indicate the difficult task faced by the courts. On one hand, the delicate issues of constitutionality have to be met; and on the other, society demands protection, in areas of obscenity. The problems of law enforcement are equally difficult. Unlike most other crimes where the elements of the offense are spelled out quite vividly, in obscenity matters that is not the case. There is no way for police to know if a crime is being or has been committed because they have no way of knowing what a community will regard as obscene.

  3. Pornography Investigation

    1. Production/distribution

      1. National Distribution (Chart A)

        Numerous pornography producers/distributors are identified in this investigation. The following is a summary of national suppliers throughout the United States.

        Parliament News Company, Chatsworth, California appears to be one of the most prominent distributors in California and the company has been identified as distributing to: Sovereign News Company, Cleveland, Ohio; Canyon News Company, Glendale, Arizona; Rivergate News Company, New Orleans, Louisiana; Bon Jay Sales, Baltimore, Maryland; and Help Publishers & Distributors, Inc., Harvey's Lake, Pennsylvania.

        Sovereign News Company, Cleveland, Ohio receives pornographic material from nationwide sources including Parliament News Company, Chatsworth, California; Star Distributing, Ltd., New York, New York; Stardust Enterprises, 'Pennsauken, New Jersey; and Peachtree National Distributors, Atlanta, Georgia. In return, Sovereign News Company distributes to: Royal News Company, Romulus, Michigan; Sun Dial News Company, Denver, Colorado; Canyon News Company, Glendale, Arizona; Capitol News Company, Chicago, Illinois; Noble News Company, Baltimore, Maryland; Century Sales, Pennsauken, New Jersey (formerly Crown News Company, Camden, New Jersey); Imperial News Company, Depew, New York; Castle News Company, Butler, Wisconsin; Majestic News Company, Pittsburg, Pennsylvania; Automatic Enterprises and Atlantic Magazine Company, Washington, D.C.

        Star Distributing, Ltd., New York, New York, supplies pornographic material to Joe P. Enterprises, Boston, Massachusetts; Help Publishers and Distributors, Inc., Harvey's Lake, Pennsylvania; Century Sales, Pennsauken, New Jersey; Bon Jay Sales and Noble News Company of Baltimore, Maryland; Peachtree National Distributors, Atlanta, Georgia; Florida Periodicals, Tampa, Florida; Rivergate News Agency, New Orleans, Louisiana; and the Distributor System of Texas, Fort Worth, Texas.

        Crown News Company (name changed to Century Sales), Pennsauken, New Jersey has been identified as supplying Help Publishers and Distributors, Harvey's Lake, Pennsylvania. Bon Jay Sales, Baltimore, Maryland distributes pornographic material to Atlantic Books Distributors, Providence, Rhode Island, who in turn distributes to Magazine Agency, Minneapolis, Minnesota.

        Peachtree National Distributors, Atlanta, Georgia supplies Century Sales (Crown News Company), Pennsauken, New Jersey; Carolina Books Distributors, Raleigh, North Carolina; Florida Periodicals, Inc., Tampa, Florida; Sovereign News Company, Cleveland, Ohio; All Star News Agency, St. Louis, Missouri; Castle of Arcades, Lawton, Oklahoma; Satellite News, Biloxi, Mississippi; Star News, Biloxi, Mississippi; Rivergate News Company, New Orleans, Louisiana; and Satallite News Agency, Inc., Houston, Texas.

        Florida Periodicals, Inc., Tampa, Florida, is supplied by various suppliers end distributes pornographic material to Sovereign News Company,. Cleveland, Ohio.

        The largest East Coast distributor has been identified as Star Distributing, Ltd., New York, New York, whose major recipient is Peachtree National Distributors, Atlanta, Georgia, who in turn distributes on a nationwide level. Documentation indicates that Star Distributing, Ltd., distributes as far West as Cleveland, Ohio (Sovereign News Company). Sovereign News Company distributes as far West as Colorado; Southwest into Arizona; and along the East Coast. In turn, Sovereign News Company, Cleveland, Ohio, is a major recipient of pornographic material from Parliament News Company, Chatsworth, California.

      2. California Production/Distribution (Chart B)

    2. Individual Corporate Organizational Profiles

      As a result of the voluminous amount of information forwarded, corporate organizational profiles have been developed. These profiles are linked to organized crime and include: Komar, Ltd. (Boltansky); Linhorn Investors, Ltd. (Womack); Star Distributing, Ltd. (DiBernardo); SFD Productions, Inc. (Levine); Miller Road Bingo Hall (Wisotsky); Global Industries (Thevis); Bon Jay Sales (Gresser); Sovereign News Company (Sturman) and Stu Segall & Associates (Zaffarano). Based on supplied documentation, the following narrative will depict the above individual corporate organizational structures and their relationships to each other. For the convenience of the reader, the organizational profiles are developed in stages.

      1. Corporate Organizational Profile #1 (Chart C)

        John Sanza is the secretary/treasurer for Man's World, Inc., 918 9th St., N.W., Washington, D.C. whose agent is Jeanette Hargrove. Jeanette Hargrove is the original agent of 808 K Street Association, Ltd., T/A Mark II Cinema, 808 K St., N.W., Washington, D.C., with S. Douglas Guise as the current president, James Proferes as a previous president (1975) and George Mekedes as the vice president. James Proferes is the president and George Mekedes is the incorporator for the Metropole Social Club, 104 Rhode Island Ave., N.W., Washington, D.C.

        J. Douglas Gurge is the president for Croatan Books, Inc., 8653 Richmond Highway, Fairfax County, Virginia (corporate address is 121 Brooke Ave., Norfolk, Virginia and maintains P.O. Box 2817 which is 922 14th St., N.W., Washington, D.C.) whose original manager was Richard Goudie and the secretary/treasurer is Jeanette Hardrove. Herman Womack is the owner of the Beach Adult Gift Shop, Virginia Beach, Virginia, which employs Richard Goudie.

        Richard Goudie is the vice president of A & R Books, Inc., T/A A & R Books, 922 14th St., N.W., Washington, D.C., with James Ingram as the president and J. Douglas Gurge as the registered agent. Richard Goudie is also the agent for M Street Periodicals, 1746 M St., N.W., Washington, D.C., with James Ingram recorded as the owner. James Ingram is also the owner of Tidewater Periodicals, 3502 Washington Ave., Newport News, Virginia; Marlow Heights Periodicals, 4418 Barnabas Road, Temple Hills, Maryland; Maryland Money Management, 922 14th St., N.W., Washington, D.C. (same address as A & R Books, Inc.) and Croatan Distributors, 3005 McKinley St., N.W. and 922 14th St., N.W., Washington, D.C.

        James Ingram is the vice president (1974), Horace Wiltshire is secretary/treasurer (1975), Herman Womack was president (1976), Michael Nickerson is secretary/treasurer (1976), Peter Spruill was vice president (1976). and Rose Nickerson was secretary/treasurer (1974) for the Linhorn Investors, Ltd., 1520 East Ocean View, Norfolk, Virginia.

        Herman Womack owned bookstores in Maryland, Virginia and Washington, D.C. In 1971, by terms of his probation, he was barred from further participation in the pornography business. As a result, Womack allegedly sold his pornography businesses and currently resides in Norfolk, Virginia.

        Womack is the president of the Guild Book Service, Inc., 117 Brooke Ave., Norfolk, Virginia, and Budget Books, Inc., 2328 E. Little Creek Road, Norfolk, Virginia. Michael Nickerson is the secretary/treasurer and Peter Spruill is vice president. Horace Wiltshire (secretary/treasurer of Linhorn Investors, Ltd.) is also a director for Budget Books, Inc. Michael Nickerson is the vice president, Peter Spruill is the secretary/ treasurer and Rose Nickerson is the president of the Ft. Eustis Bookstore, 16909 Warwick Blvd., Newport News, Virginia. Rose Nickerson is listed as the president of the Shipyard Bookstore, 3415 Washington Ave., Newport News, Virginia; Admiralty Books, 8210 Hampton Blvd., Norfolk, Virginia; Shore Drive Books, 8141 Shore Drive, Norfolk, Virginia; and Fleet Books, 121 Brooke Ave., Norfolk, Virginia.

      2. Corporate Organizational Profile #2 (Chart D)

        On July 21, 1964, Robert E. Smith, Melvin Rankin and Samuel Boltansky were the incorporators for Central Magazine Sales, Ltd. In March 1968, the corporate records were amended to change the name from Central Magazine Sales, Ltd., to Central Sales, Ltd., Inc., with Alvin Tapper as secretary and Samuel Boltansky as president and sole stockholder. On April 25, 1968, Central Sales, Ltd., Inc., was changed to a closed corporation. On December 31, 1968, Tom Cat Distributing Company was merged with Central Sales, Ltd., Inc. On September 14, 1971, the name Central Sales, Ltd., Inc. was changed to read Komar, Ltd., T/A Central Sales East. On October 31, 1973, Foto, Inc., X-Bolt, Ltd., and Central Distributors, Inc., were merged into Komar, Ltd. Employed by Komar, Ltd., are Mel Ulnick, Louis Guglielmi (who signs the employees' checks) and John Sanza. Sanza is also the president of Man's World, Inc., 918 9th St., N.W., Washington, D.C.

        On January 14, 1975, a Roadway tractor, Maryland license number 7699FB, listed to Roadway, 240 South Kresson St., Baltimore, Maryland, was observed at Central Sales, Inc. This tractor was pulling a trailer, Delaware license number T37585. Several men from Central Sales, Inc., assisted in loading approximately 10 large crates into the trailer. These crates contained arcade booths (peep show booths) which were being shipped by Central Sales, Inc., to a vending company at 6427 Westheimer Road, Houston, Texas. The telephone number the driver was to call prior to delivery was 661-2201. Information was received from the Houston Police Department that the address 6427 Westheimer Road is the location of the Westheimer Newsstand. The telephone number 661-2201 is listed to the Starbase Publishing Company which owns the Westheimer Newsstand and the Bellaire Newsstand at 5807 Bellaire Boulevard, Houston, Texas.

        On October 25, 1976, a search and seizure warrant was served at Central Sales, Inc., by the Baltimore Police Department, Maryland. During the search, it was found that all pertinent business records for the years 1974, 1975 and 1976 had been removed. The vice president of Central Sales, Inc., Louis Guglielmi, admitted moving the records because he could not operate his business if they ;_ were seized. He also stated that he moved the records immediately following a raid. at Bon Jay Sales, Inc., 6601 Moravia Park Drive, Baltimore, Maryland. Records that were found mentioned a business named the Distribution Systems of Texas located at 2416 Ludelle St., Fort Worth, Texas. This company distributed pornographic material in the Texas area and Louis Guglielmi signed all the checks for the employees. The employees of the Distribution Systems of Texas were listed as William Wheeler, Robert Bond and Mel Ulnick. Ulnick was also mentioned as being an employee of Komar, Ltd. Records indicated that the Distribution Systems of Texas sent a $1,000 monthly check to Star Distributors, Ltd. The last check found at Central Sales, Inc., indicated that this $1,000 was transferred on January 14, 1974.

        In 1970, Robert Eugene Smith, an attorney for Samuel Boltansky, filed several court cases in states other than Maryland in which he claimed to be representing Komar, Ltd. and Star Distributors, Ltd. Samuel Boltansky is also the registered agent for Boltansky Enterprises, Inc., 1123 E. Baltimore St., Baltimore, Maryland (same as Tetra Corp.) with Harold Witman, Harry Anderson and Remay Miller as incorporators and George Boltansky as the secretary. Samuel Boltansky, Sheldon Braiderman, Michael Milton and Michael Grossfield are the incorporators for Towson Books, Inc. (formerly Budget Books, Inc.), located at 516 York St., and 1125 E. Baltimore St., Baltimore, Maryland. Samuel Boltansky owns the property at 928 14th St., N.W., Washington, D.C., which is the location of Sanza Books, Inc. owned by John Sanza. John Sanza is the agent for Denton Corporation, 419 E. Baltimore St., Baltimore, Maryland with Thomas Quaranta as the incorporator, Louis Guglielmi is the vice president with James Haskins as president and James Johnson as incorporator of Central Sales, Inc.

        Alvin Tapper, Guglielmi and Melvin Epstein are directors of the ALM Corporation, 1023 E. Baltimore St., Baltimore, Maryland (same address as Central Sales, Inc. and Komar Ltd.). The date of incorporation for ALM Corporation was July 3, 1972. This corporation's primary purpose was to purchase, own and hold the stock of other corporations acting as a "Holding corporation." An article of amendment dated February 17, 1975, revealed that the corporation became a closed corporation with Louis Guglielmi as the president and sole stockholder. The office address was changed to 1023 E. Baltimore St., Baltimore, Maryland, Louis Guglielmi being the resident agent. The secretary was listed as Michael Mulherin. According to the tax records for 1976, the president of the company was Louis Guglielmi and the vice president was Bradford Boone of Orchard Way, Masonville, Virginia. Louis Guglielmi,is director of Commercial Distributors, 1022 Watson St., Baltimore, Maryland with Louis Omansky as incorporator and Michael Kaminkow as the registered agent. Michael Mulherin (secretary for ALM Corp.) is a director of KMT, Inc., T/A Sweden Books, 3710 Washington St., Newport News, Virginia, with Kenneth Yontz as president and Thomas Pallette as a director. Michael Mulherin is also the owner of Man's World Bookstore, 1700 E. Washington St., Petersburg, Virginia. Thomas Pallette, Clifton Harrison and Keith Edenfield are directors of Eros Bookstore, Inc., 125 Brooke Ave., Norfolk, Virginia, with Lowell Valvanio as registered agent. Pallette, Harrison, Edenfield and Valvanio are also corporate officers for the Royal Bookstore, Inc., 161 Granby St., Norfolk, Virginia. Thomas Pallette is president and Lowell Valvanio is the registered agent of Variety Books and News, Inc., 3300 Washington St., Newport News, Virginia, with Thomas Gach as secretary and treasurer.

        Samuel Boltansky is the president, Nathan Grama the secretary and Robert Strong the vice president of Radiant Merchandising Company, Inc., 1223 Arch St., Philadelphia, Pennsylvania. Bruno Cortese is the bookkeeper of Radiant Merchandising Company, Inc.

      3. Corporate Organizational Profile #3 (Chart E)

        Star Distributing, Ltd., is a wholesale pornography distributor located at 150 Lafayette St., New York, New York. They receive pornographic material from UltraConcepts and Milky Way Productions, New York. Ultra Concepts provides art work, pictures, actors and models. Star Distributing, Ltd., maintains the distribution rights of Screw magazine published by Milky Way Productions, 116 West 14th St., New York, New York, whose president is Jim Buckley and the secretary is Al Goldstein. In an interview with the New York Times, Al Goldstein, the editor and publisher of Screw magazine, openly discussed the LCN ties of the distributing companies when he said, "We have no options as to who we deal with. No legitimate distributor will touch us. I'd deal with Hitler if I had' to. I'll deal with anyone I can do business with." Goldstein and Buckley eventually signed a contract with Star Distributing, Ltd., who agreed to handle the paper outside New York City; but they refused to deal in the city. Goldstein also said he did not feel threatened by anyone at Star Distributing, Ltd., as long as he produced money for them. The New York edition sold for $1.00 and the national edition for $1.25. Milky Way Productions received $0.40 for each paper sold in New York and $0.30 for each paper sold outside the city. Star Distributing, Ltd, distributes to Peach tree National Distributors, 260 Luckie St., Atlanta, Georgia; Rivergate News Agency, 411 Jackson St., New Orleans, Louisiana; Bo, Jay Sales, 6601 Moravia Park Drive, Baltimore, Maryland; Distributor Systems of Texas, 2614 W. Delle St., Ft. Worth Texas; Help Publishers and Distributors, Road #1, Pole 260, Harvey's Lake, Pennsylvania; Este Arte Corporation, Palm Beach, Florida; Sovereign News Company, 2075 E. 65th St., Cleveland, Ohio; Joe P. Enterprises, 694 Washington St., Boston, Mass.; Noble News Company, 7083 Pulaski Highway, Baltimore, Maryland and Crown News Company, 1171 Chestnut St., Camden, New Jersey.

        Theodore Rothstein's involvement in pornography became known to law enforcement in 1955 when he and Robert Barkow were arrested and convicted of photographing nude males and females. Rothstein is the president and Marvin Friedman is the incorporator for Star Distributing, Ltd. When Star Distributing, Ltd. first came to the attention of law enforcement .authorities, it was a failing business. Its operations, according to one witness testifying at a hearing held by the New York Commission of Investigation, were severely hampered by its need for cash. Shipments to Star Distributing, Ltd. were on a strict cash basis. Credit or consignment sales were not acceptable. Star's financial position and credit rating suddenly improved and it began receiving merchandise on consignment. Along with this financial change came a new corporate officer, Robert DiBernardo. It was also clear, according to one witness, that in all subsequent business transactions, DiBernardo had the "last word" in Star. DiBernardo had no prior experience in this field. He had been the owner of Satellite Wheel Alignment Company in Brooklyn, New York. One of his employees at Satellite was Gaetano "Corkey" Vastola who was known to law enforcement authorities as a member of the New Jersey LCN DeCalvacante Family and had been convicted along with DeCalvacante in the Federal Court of Newark, New Jersey. Some of the known affiliates of Star were identified at the New York State Commission of Investigation's public hearing in 1970. Bonate, Inc., occupied the same office space as Star. This firm operated as a local distributor of sex-oriented books and magazines. Also at this location was a firm known as "NAA". This firm was known to law enforcement as a mail order outlet for similar material and operated by Neil Albaum. Albaum had been involved in pornography in Suffolk County, New York, and has subsequently relocated to the offices of Star Distributing, Ltd. At these same premises, Albaum conducted business under the trade names NAA Films, Unlimited and Photo Print Distributors, Ltd. Albaum had also operated Debon Distributors, Ltd., at another location and in partnership with Robert Barkow.

        Barkow and Albaum had also established a mail order house in Toronto, Canada, called the Club Levon. This enterprise was designed to handle the international mail order distribution of sex-oriented materials in Canada and the United States. Rothstein also appeared as the president of two companies located in Manhattan which did the printing and photo work for star and its affiliates.

        The New York Commission of Investigation had also examined the operations of Robert Barkow and his connection with various distribution firms. Barkow appeared as the front man in three firms, all located in the same premises and operated out of the same office. These firms were so closely inter-related that for all practical purposes they were one operation. The first of these firms was CAD Publishing Corporation which was formed in August, 1968 by Joseph Brocchini. CAD Publishing Corporation published sexoriented illustrated paper back books and magazines. Brocchini had no prior experience in this field. His background had been in organized crime as a gambler and loan shark in Queens', New York. His operations in Queens were under the direct supervision of Joseph Lucchese, the brother of the leader of the LCN Lucchese Family. Brocchini, according to one witness, had admitted to having been a "shylock" before engaging in the publishing field and his background was well known. CAD Publishing Corporation's books and records were the same source of information available to the Commission concerning its operation Entries reflected payments for printing books and magazines. Early in its operation, CAD Publishing Corporation worked essentially on a subcontracting basis. However, in January, 1969, CAD Publishing Corporation engaged a printer, Web Books, Inc. who took over this entire operation.

        Bark Book Distributors was formed by Robert Barkow in October, 1968 and was operated by him up to the time of the commission's public hearing. Bark Book Distributors was apparently formed to distribute nationally the CAD Publishing Corporation's line of paper backs and magazines. Bark Book Distributor's records reflected that 90% of their purchases were from CAD Publishing Corporation. By projection, lacking accurate sales records, Bark Book Distributors grossed approximately $300,000.00 a year.

        The third major corporation at this location was the B & H Distributors, Inc., which was formed in March, 1969, to be a distributor of sex-oriented books, magazines and films. Approximately 20% of this company's purchases were from CAD Publishing Corporation. The principals in this operation were obstensibly Robert Ford and Howard Wasserman but the real boss was Robert Barkow. The books of B & H Distributors, Inc. showed that Barkow and Brocchini were drawing substantially higher salaries than either Ford or Wasserman. Ford remained in this operation for a short period of time. Wasserman, on the other hand, operated as sales manager for B & H Distributing, Inc. Manuel Block, the companies sole salesman, reported to him. The company had 4 or 5 office employees and a group of warehouse employees headed by Brocchini's brother-in-law, Bart Salamone. The corporate structure was: the salesman reported to the sales manager, who reported to Barkow, who in turn reported to Joseph Brocchini. There was no doubt that Brocchini was the boss with Barkow acting as the office manager.

      4. Corporate Organizational Profile #4 (Chart F)

        In a South Florida pornography case, Sidney Levine of New York City was convicted in a federal court of making low budget pornographic movies in a North Miami warehouse. Levine had admitted that Robert DiBernardo and others connected with Star Distributing, Ltd., were employees of his firm SFD Film Production, Inc., and had also loaned the firm money to buy a film. Sidney Levine is the president of Real Invest International Corp., 2554 North Federal Highway, Dania, Florida, with Ethel Levine as secretary. Levine is also president of Electronic Time Corp., 2554 North Federal Highway, Dania, Florida, with Michael Strauss as secretary. Strauss is also president of Growth Systems, Inc., 2554 North Federal Highway, Dania, Florida. Two other companies with the same address as 2554 North Federal Highway are the Media Haven Advertising Agency and American Picture Productions Corp. Sidney Levine is the registered agent with D.W. Smith as president and Dave Gardner as vice president of the Video Cinema International Corporation, 1001 N.W. 62nd St., Ft. Lauderdale, Florida. Smith and Gardner are also respectively the president and vice president of Video Theater Inter national Corporation, 1001 N.W. 62nd St., Ft. Lauderdale, Florida.

      5. Corporate Organizational Profile #5 (CHART G)

        During a Florida investigation, telephone exchanges were checked on the Esteart Corp., 7520 N.W. 5th St., Miami, Florida and the residence of Michael Wisotsky and revealed numerous long distance telephone calls to Star Distributors, Ltd. in New York and the Duro Games, Inc., 347 W. Broadway, New York City. Duro Games, Inc. was also phoned by the Miller Road Bingo Hall whose corporate structure in 1974 revealed Theodore Rothstein as the vice president and Francis Westerly (wife of Myron Wisotsky) as the operator. Francis Wisotsky is the registered agent, Vincent Bracco is the president and Bonnie Bracco is a director for Cornhuskers, inc., 2507 North Federal Highway, Delray Beach, Florida. Michael Wisotsky is the registered agent for Paradise Books, 1235 State Road 7, Hollywood, Florida and the Wisecon, Inc., 1700 North Federal Highway, Miami, Florida, along with Vincent Bracco as president and Bonnie Bracco as a director. Vincent Bracco is president secretary/treasurer and Sidney Gursey is the registered agent of the Lucky Five, Inc., 6636 N.W. 57th St., Tamarac, Florida. Vincent Bracco is the president and Bonnie Bracco is the secretary for the Westland, Corp., 12405 S.W. 93rd St., Miami, Florida; Fun Forall, Inc., 7012 S.W. 4th St., Miami, Florida (dissolved); J.J. Publishing Co., 7004 S.W. 4th St., Miami, Florida; and the Adult Ventures, 2501 North Federal Highway, Delray Beach, Florida. Joseph Bracco, the nephew of Vincent Bracco is a shop steward for Local 814 International Brotherhood of Teamsters in New York City. Palma Lock is the registered agent for Westland Corp.; Fun Forall, Inc.; J.J. Publishing Co.; Adult Ventures, Inc.; and the Alms, Inc., 13993 Biscayne Blvd., Miami, Florida. Arthur Siegal is president of the Alms, Inc., Swank Health Spa, 20462 South Dixie Highway, Miami, Florida, Esteart, Inc., 7520 N.W. 5th St., Miami, Florida and the Adult Films & Projections Systems, 5770 Funston St., Hollywood,. Florida. Estelle Siegal is the secretary of the Alms, Inc., vice president of the Swank Health Spa with Albert Rubenstein as the registered agent, secretary of the Esteart, Inc., with Albert Engel as the registered agent and Robert Tedeschi as the manager. She is also the secretary-of the Adult Films and Projections Systems with Robert Tedeschi as the registered agent. Martin Wisotsky, the uncle of Michael Wisotsky is listed as the registered agent of the SMYL Corp., 9514 South Dixie Highway, Miami, Florida.

        During an investigation in April 1976, investigators purchased hardcore films and magazines from Michael Wisotsky during which Michael bragged about "being connected." Michael Wisotsky was charged with wholesale promotion of obscene material by the Broward County Attorney's Office and has admitted that he repairs projectors for the Esteart Corp., a peep show machine business. Also during the investigation of Wisotsky, detectives purchased hardcore material from two subjects, Vincent Digiacomo and Ernest Ferguson. Both subjects have past involvements in the sale and promotion of obscene material. Digiacomo and Ferguson admitted to being "jobbers" (distributors) for large pornography houses; however, they stated that they did not have any knowledge who was running the large houses. The investigation revealed they are used by processors and producers to distribute films since the processors. and producers are fearful that interstate shipments on pornographic material will be seized and they will be charged with federa-1 violations. The large processors shipped their material to Ferguson and Digiacomo- at various South Florida locations. Packages were falsely labeled using bogus names for the sender and were addressed to alias' being used by Ferguson and Digiacomo. These two men would then distribute to bookstores in Dade, Broward and Palm Beach Counties. Both men admitted- that they had 'a close working relationship with the Wisotsky family. Further investigation revealed they had distributed for St., Distributors, Ltd. (New York City), Bon Jay Distributor (Baltimore, Md.), NFM Distributors (Calif.) and TGA Films (Calif.).

        In 1976, a meeting was held at Tony Roma's Restaurant, 460 Northwest 40th Ave., Plantation, Florida. Broward Sheriff?s Office surveilled the meeting which revealed Michael Wisotsky, Natale Richichi, Robert Rubino (chaffeuri for Ettori Zappi, a captain in the LCN Gambino Family), Anthony Lo Presti (owner of the restaurant), Maria Freedell (girlfriend of William Bittner), Michael Rogers (an operator of massage parlors in Broward County) and Robert Tedeschi (aka Bob The Machine Man) meeting together.

        A telephone toll analysis was conducted on Natale Richichi and it revealed telephone calls to the Imperial Distributors, 834 Hope St., Providence, Rhode Island, and to Robert DiBernardo, a soldier in the LCN DeCalvacante Family and a shareholder in Star Distributors, Ltd., 150 Lafayette St., New York, New York.

      6. Corporate Organizational Profile #6 (Chart H)

        Peachtree National Distributors, along with Global -Industries Inc. and Agency Services, Inc. are subsidiaries of the Fidelity Equipment and Leasing Corporation. Peachtree National Distributors, Inc. is a pornographic distributor who forwards shipping manifests to and receives shipment inventories from Florida Periodicals, Inc. They order pornographic books from Star Distributors, Ltd.

        Michael Thevis has been involved in the publication and distribution of pornographic material since the early 1960'x. He has been arrested numerous times by the Atlanta police Department, but his attorneys were successful in keeping him out of prison until Federal authorities began investigating him in 1970. United States Attorneys in Jacksonville, Atlanta and New Orleans obtained four separate convictions of Thevis.

        A check of court records on October 30, 1972 indicated a Federal Grand Jury returned 17 indictments against Michael G. Thevis, Jr., and his wife, Joan C. Thevis. They were charged with violating federal laws regarding interstate transportation of obscene material and advertising obscene matter through the mails. Indicated as co-defendants were these Atlanta businesses: Book Bin, Inc.; Peachtree News Co., Inc.; Pendulum Book, Inc., and Peachtree National Distributors, Inc. The couple was charged with mailing unsolicited obscene matter into nine states: Illinois, Colorado, Alabama, Indiana, New York, California, North Carolina, Tennessee and Texas, and with shipping obscene material to retailers in Florida and the District of Columbia.

        According to a press release on June 23, 1971, Michael G. Thevis was convicted on 12 counts of shipping obscene material across a state line. On June 25, 1971, Thevis was sentenced to five years in prison and fined $5,000 on each 12 counts of shipping obscene material.

        Court records were also checked on April 8, 1975, and they showed that Michael Thevis was also sentenced in Lexington, Kentucky. Thevis was found guilty on 12 counts and will serve three years on each count to run concurrently and he was fined $45,000. Thevis is quoted as saying "I rode the boom to its crest and I made a lot of money. I'm not sorry for it." Although Thevis testified that he had sold all of his pornography businesses to Laverne Bowden, a corporate officer in several of Thevis' pornography businesses, Federal agents posing as pornography dealers in New Orleans were told that Thevis is still in control. Thevis has admitted that he still owns buildings in which pornography operations are being conducted. Michael Thevis is recorded as the president of Global Industries, Inc., and a director for-General Recording Corp., and was the former president of Pendulum Book, Inc., and a former officer of Book Bin, Inc. Thevis was arrested by the F.B.I. for violation of the Escape and Rescue Statute, Mail Fraud, Conspiracy, Obstruction of Criminal Investigation and Obstruction of Justice.

        William Williams is the president of Peachtree News Co., with Gerald Matheny as secretary/treasurer, and Kevin Mason as vice president. Williams is the secretary, Ralph Mitchem is the treasurer and Richard Wilson is the registered agent of Panama Books, 267 Marietta Avenue, Atlanta, Georgia, T/A Dale Mabry Bookmart, 3325 S. Dale Mabry, Tampa, Florida, T/A T & K Entertainment, 1772 W. Hillsborough, Tampa, Florida and T/A Busch Blvd. Bookstore 2106 E. Busch Blvd., Tampa, Florida (owner is listed as Norman Abood). William Williams is the president of Florida Periodicals, Inc., 7210 Anderson Road, Tampa, Florida, with Ralph Mitchem as secretary/treasurer, and Norman Abood as the registered agent. Williams is the secretary/treasurer of Cinematics, Inc., 267 Marietta Ave., Atlanta, Georgia, with Gerald Matheny as the president. Williams also pays for all expenses incurred by the Austin Bookmart, Campus Bookshop and the Pleasure Shoppe, all located in Houston, Texas.

        Melvin Friedman is recorded as president of Peachtree National Distributors, Inc. He, along with Rodney Smith and Julius Davenport, are officers for Carolina Books Distributors, 213 N. Harrington Street, Raleigh, North Carolina. Friedman is the secretary/treasurer of Johnny Reb's Books and the Card Shop, Inc., co-located at 267 Marietta Ave., Atlanta, Georgia. He is also an incorporator for All Star News Agency, 267 Marietta Ava., Atlanta, Georgia, with a branch office at 3721 Washington Ave., St. Louis, Missouri, and 1651 W. Howard Ave., Biloxi, Mississippi, whose president is Ralph Mitchem. Melvi, Friedman was a former president of Peachtree News Company, 267 Marietta Ave., Atlanta, Georgia.

        The Peachtree News Company, All Star News Agency, and the Southland Distributing, 174 Mill Street, Atlanta, Georgia, are subsidiaries of Global Industries, Inc., 177 Snooty Fox Chase, Sandy Springs, Georgia, whose parent company is Fidelity Leasing and Equipment Corp., 267 Marietta Ave., Atlanta, Georgia. The corporation officers of Global Industries, Inc., are Pat McClean as president, Robert Mitchem as an incorporator, Laverne Bowden as the major share holder, and Joan Thevis as the current secretary.

        Robert Mitchem is also the president of Apollo News, 515-1/2 East Houston, San Antonio, Texas, and the president of the Intimo News, 417 Myrtle Street, El Paso, Texas (inactive), with Ed Smith as the secretary. Gilbert Dietch and Robert Eugene 8mith are directors, Joan Thevis is the secretary, and S. E. Widdoes, W. J. Reif and R. A. Finger are incorporators of the General Recording Corp. Gilbert Dietch, L'Kenny Helm and Warren Mason are directors, Pat Hickey is the secretary/treasurer, William Williams is the president, and Laverne Bowden purchased 100% of the shares of the Fidelity Equipment and Leasing Corp., 267 Marietta Avenue, Atlanta, Georgia. Pat Hickey is the secretary/ treasurer and Laverne Bowden is the president of the Omega Sales, Inc., 272 Marietta Avenue, Atlanta, Georgia. Laverne Bowden frequents the following businesses: D.A.B. Corp., T/A Gaslight Adult News, T/A Diners News, T/A Main Street News, all of 2800 Pioneer #118, Irving, Texas, whose incorporators are Joe Davis, Joe Davis III, and Stephen Davis and the Satellite News Agency, Inc., 500 N. Shepherd Avenue, Houston, Texas. Satellite News Agency, Inc., is a subsidiary of Agency Services, Inc., 500 N. Shepherd Avenue, Houston, Texas, whose parent company is Fidelity Equipment and Leasing Corp., and incorporators are Alice Parrott, Wilson Cooper and Helen Sloss. Other businesses with the address of 267 Marietta Avenue, Atlanta, Georgia, are Culver, A.L. Polygraph and Peachtree Books Distributing Co.

        The Fidelity Equipment and Leasing Corporation was incorporated on July 10, 1972, and operates as a holding company with the general business in leasing new and used equipment of every kind and character. Global Industries, Inc., Agency Services, Inc., co-located at 500 N. Shepherd Road, Houston, Texas, and Peachtree National Distributors, Inc. are subsidiaries. Global Industries, inc., was incorporated for the purposes of purchasing securities or debt instruments of businesses of every kind and description, operating in corporate or other form. It maintains accounting services for Florida Periodicals, Inc., Peachtree News Co., Castle of Arcades, Satellite News Agency, Star News, Satellite News, All Star News Agency, and Rivergate News Agency.

        The Agency Services, Inc., issues operational orders to and receives merchandising and sales reports from Florida Periodicals, Inc. Peachtree National Distributors is a pornographic distributor who forwards shipping manifests (contents) to and receives shipment inventories from the Florida Periodicals, Inc. Peachtree National Distributors, Inc., orders pornographic books from Star Distributors, Ltd., who in turn forwards shipping manifests (contents) to Peachtree National Distributors. Florida Periodicals, Inc. receives pornographic scrap books from Star Distributors, Ltd., and Lyndon Distributors, 15756 Arminta Station, Van Nuys, California.

        Melvin Friedman, Robert Mitchem and Ed Smith are officers of the Greensboro Bookmart, T/A The Paris Bookstore and Fantasia Bookstore, which maintained a local bank account with the manager, depositing the money and forwarding the sales sheets to Laverne Bowden (Fidelity Equipment and Leasing Corp.) on a daily basis. The store received all their pornographic materials from Carolina Books Distributing, Raleigh, North Carolina. A coin collector comes to the store every seven to ten days to empty the peep show machines and change the films. The store had twelve peep show projectors and 103 films for sale on August 19, 1977. The manager received five percent of the money collected from the machines. Austin Hardison Evans was identified as the coin collector and operated a Trans Am Pontiac with Georgia registration PEL-920, which is registered to Cine-Matics, Inc., Atlanta, Georgia. Greensboro Bookmart, T/A Fantasia Bookstore was also operated in the same manner and included the same corporations and distributor. The employees of both stores were originally paid by Global Industries, Inc., and then by the Fidelity Equipment and Leasing Corp. Michael Thevis and his wife, Joan, signed the lease for the property where the bookstores were located. Both stores have since been moved.

        Rosalie Lonsdale, the owner of five pornography bookstores in Houston, Texas, when interviewed by an agent of the Texas Department of Public Safety, stated she had been in debt to Michael Thevis for $60,000. When Lonsdale wanted to sell her stores (debt had been reduced to $20,000), she was contacted and told to pay off the note before she sold. When she attempted to sell the stores, Tom Mitchell of Atlanta, Georgia, under the U.T. Corporation, arrived and assumed the operations of the bookstores.

        Chaparral Book Mart, 413 Peoples Street, Corpus Christi, Texas receives its pornographic material from the Sanco Distributing Co., 172 Marietta Avenue, Atlanta, Georgia. San Antonio Book Mart, 2018 Broadway, San Antonio, Texas, is owned by William -Sherlock Parrish. Parrish has several arrests for sale of obscene material and his. bail bond bills were sent to Pat McClean (president of Global Industries, Inc.). Taxes on World News Stand, 1230 Nort# 3rd Street, Abilene, Texas, are billed to William Williams Post Office Box 4215, Atlanta, Georgia (Fidelity Equipment and Leasing Corp.). The 3110 South Shepherd, Inc., also located at Post Office Box 4215, is responsible for paying state sales taxes on the following businesses in Texas:

        Diner's News
        240 Westheimer
        Houston, Texas

        Fort Worth News
        307 Main Street
        Fort Worth, Texas (inactive)

        Gaslight Adult News
        3519 West Holcombe Boulevard
        Houston, Texas

        Main St. News
        4418 Main Street
        Houston, Texas

      7. Synopsis

      8. Corporate Organizational Profile #7 (Chart J) Bon Jay Sales is a wholesale pornography distributor located at 6601 Moravia Park Drive, Baltimore, Maryland. They receive pornographic material from star Distributing Ltd., New York, New York; Sovereign News Company, Cleveland, Ohio, and Parliament News Company, Chatsworth, California. Sovereign News Company distributes pornographic material to Atlantic Distributors, Providence, Rhode Island; Suburban News, Inc., Silver Spring, Maryland, and Bookstores in Washington, D.C., Maryland, Virginia, North Carolina, New York, and New Jersey.

        The president and sole stockholder of Bon Jay Sales is Jack Gresser. Gresser is also the registered agent for Woodwork, Inc., 1010 N. Chester Street, Baltimore, Maryland, and Alpha Sentura Business Services, Inc., 205 W. Fayette Street, Baltimore, Maryland. He is the director of Centre Vending Company, 205 W. Fayette Street, Baltimore, Maryland, and obtained the mechanical license for Fayette News Center Inc., 205 W. Fayette Street, Baltimore, Maryland.

        In 1976, a search warrant was executed by the Maryland State Police and the Baltimore City Police Department on Bon Jay Sales' warehouse. Seized documents revealed that Bon Jay Sales was conducting considerable business with Parliament News Company, California, and with Star Distributing Ltd., New York, New York. At one time, Gresser owed Parliament News Company $190,000. Gresser has a reputation of being a poor creditor with many overdue accounts and defaulted loans, and yet, a company in California allowed him to accumulate such a large debt. This pattern was also followed by Gresser who allowed some retailers to incur large debts to Bon Jay Sales.

        At the time of the raid, the Little Bookstore, Baltimore, Maryland, owed Bon Jay Sales more than $90,000, a figure that exceeded their gross annual sales. Other businesses that had substantial balances due on various accounts to Bon Jay Sales were the Adam & Eve Bookstore, Washington, D.C. ($11,916); Baltimore News Center, Maryland ($94,840); Bragg News Center, North Carolina ($33,904), Centre Vending Company, Maryland ($19,650); D.C. News Center, Washington, D.C. ($60,910); Fayette News Center North Carolina ($29,000); String News, Ltd., North Carolina ($13,000), and Sovereign News Company, Ohio ($14,995). The unpaid account of Baltimore News Center reportedly exceeded the total amount the firm earns annually.

        Other correspondence revealed Bon Jay Sales used attorneys Reuben Caplan, William Seekford, and William Pittler to do necessary legal work. It is known that for the period from April 1973 until present, William Seekford has been paid a retainer fee ranging from $400-$600 per month. Seekford represented Bon Jay Sales in 1i criminal case in the State of Oregon in April 1973, in which Gresser was summoned and then later excused at the request of Seekford. A second case in which Seekford was involved took place in March 1974 in Norfolk, Virginia, involving the Dixie News Store located in Charlotte, North Carolina. The services of William Pittler are used to prepare the paperwork for the incorporation of businesses related to Bon Jay Sales. This is indicated by a memorandum found at Bon Jay Sales regarding the 1405 H Street Corporation in Washington, D.C. At the bottom of the note was written "names of the Board of Directors and Incorporators are forthcoming from Bill Pittler."

        Both credit card and phone company records indicate that for 18 months preceding the raid, Jack Gresser had traveled extensively throughout the United States, and several foreign countries. Those trips were to Los Angeles, California; New York; Newark, New Jersey; North Carolina; San Francisco, California; Connecticut; Minnesota; Miami, Florida; Beverly Hills, California; Sweden; Milan, Italy, and the Netherlands. On each occasion, Travel Whirl, Inc., owned by Gresser's wife, Brindell, arranged the travel itinerary. One particularly interesting business trip taken by Jack Gresser occurred on June 3, 1976, when he and Alan Schwartz, who is listed as a clerk for Bon Jay Sales, traveled to Milan, Italy, from Baltimore, Maryland. A second invoice mentioned a subject named Marrotti who also traveled to Milan, Italy, from New York, and the bill was paid by Travel Whirl, Inc., through the Centre Vending Company. On June 5, 1976, Gresser, Schwartz and Marrotti met with three Italian nationals in Milan, Italy, in reference to a large purchase of Elmo projectors.' While in Milan, Italy, Gresser contracted to purchase 1,000 projectors at $61 each from Foto Flash Universal. The records also indicated that Gresser is the sole distributor of Elmo Products in the United States. It was later learned there is an Elmo Manufacturing Corporation at 3210 57th Street, Woodside, New-York.

        Control of Bookstores by Bon Jay Sales and its method of operation is exemplified through Alan Schwartz, Oscar Lebowitz (listed as clerks for Bon Jay Sales), and William Shanks. On December 10, 1977, the Mac Sign Company, Fayetteville, North Carolina, concluded a contract with William.Shanks, representing the Alpha Sentura Business Services of Baltimore, Maryland, and linked to Bon Jay Sales through corporate papers, to install signs at String News, Ltd., Fayetteville, North Carolina. It was also determined that William Shanks was removing coins from the peep show machines in the bookstores in North Carolina. When peep show machines are installed or electrical work is required, Shanks is normally accompanied by Alan Schwartz, who is listed as a repairman for the Centre Vending Company, Baltimore, Maryland. On December 12, 1975, a van with Maryland plate #L36913, driven by Alan Schwartz, arrived at String News, Ltd. This van was registered to the Centre Vending Company, String News, Ltd., and Bragg News, Inc., both of Fayetteville, North Carolina, and operated by Charles Kruger,-III. William Shanks purchased the city licenses required to open String News, Ltd., and the incorporators were Thomas Ayres, William Bigham, and Oscar Lebowitz (listed as a clerk for Bon Jay Sales). String News, Ltd., opened a checking account in the Southern National Bank, Fayetteville, North Carolina. Although the manager could make deposits in this account, he was not authorized to write checks. All pornographic material for String News, Ltd., is supplied by Bon Jay Sales which is not registered to do business in North Carolina. On every Wednesday, the manager of String News, Ltd., telephones Bon Jay Sales and places orders for magazines and novelties. On Thursday and Friday of each week, the items are boxed and shipped by Greyhound Bus to Fayetteville. Many of these boxes were marked "machine parts" but contained only books, magazines and novelties. William Shanks personally brings film for the peep show machines and for counter sales at String News, Ltd., and Bragg News, Inc. Shanks travels to Fayetteville, North Carolina, every ten to fourteen days and collects the coins from peep show machines and returns to Baltimore, Maryland. Shanks pays the manager (formerly Charles Kruger, III, and currently Jeffery Robbins) of both bookstores ten percent of the total receipts. Robbins has a key to change the films but does not have the key to the cash box. If any of the peep show machines became inoperative, they are left for repairs until Shanks or Schwartz returns to Fayetteville, North Carolina. On August 19, 1977, String News, Ltd., had forty peep show machines and 76 films on hand for sale inside the store.

        Also found in the Bon Jay Sales' files was correspondence addressed to Gallery News, 412 Baltimore Street, Baltimore, Maryland, which was inside an envelope from Media Distributors, Ltd. (used the same address as Star Distributing, Ltd.), listing Barry Tobman as the owner of Gallery News and to contact William Shanks in case of an emergency. Tobman was also listed as a salesman for Bon Jay Sales. Information was also supplied by the United States. Customs Service that the toll calls from Bon Jay Sales when checked through the Treasury Department's computers, revealed that 20-30 of these telephone numbers were checked through the computer during an earlier narcotics smuggling investigation.

        William Seekford, Reuben Caplan, and William Pittler are attorneys for Bon Jay Sales, with John Moon recorded as president, Ronald Sellinger as Vice president, Ronald Clinton as a director, Oscar Lebowitz as a clerk, and Barry Tobman listed as a salesman. In 1975, Jack Gresser is listed as the sole stockholder of Bon Jay Sales. William Pittler is also the incorporator for Woodwork, Inc., 1010 N. Chester Street, Baltimore, Maryland (a business constructing peep show booths for pornography bookstores); the incorporator for Centre Vending Company, 205 W. Fayette Street, Baltimore,. Maryland (a business repairing peep show machines in pornography bookstores), and the resident agent for the Alpha Sentura Business Services, Inc., same address as Centre Vending Company (a business collecting coins from peep show machines). Jack Gresser is the resident agent for Woodwork, Inc., the director of Centre Vending Company, and the resident agent of Alpha Sentura Business Services, Inc., along with Barry Tobman who is listed as an employee of Alpha Sentura Business Services, Inc. William Pittler is the incorporator for the Modern Social Education, Inc., 407 E. Baltimore Street, Baltimore, Maryland, and the registered agent for the Little Bookstore, Inc., 409 E. Baltimore Street, Baltimore, Maryland. Charles Carofoli is the president, Thomas Ayre signed for the mechanical license, Richard Caplan is the director, Richard Freeman the manager, and Edward Wolfe is the vice president of D.C. News Center. Carofoli is also a board member for the Modern Social Education, Inc. Thomas Ayre is the vice president, Edward Wolfe is a director, Charles Kruger, Harold Schulte and Al Star are directors, and Barry Tobman is the president of the Little Store, Inc. Ayre is also the vice president, Kruger the director, and Tobman is the president of the Modern Social Education, Inc., 407 E. Baltimore Street, Baltimore, Maryland; Baltimore News Center, 428 E. Baltimore Street, Baltimore, Maryland; Fayette News Center, 205 Fayette Street, Baltimore, Maryland (peep show machine *license in Jack Gresser's name), and the Gayety Books, 407 E. Baltimore Street, Baltimore, Maryland. Ayre, Kruger and Tobman are also directors for G & B, Inc., T/A Broadway News Center, 301 S. Broadway, Baltimore, Maryland. Charles Kruger is vice president (1975); David Scotton is president (1975); Estor Swisher was the president (1974); Louis Roseman was the vice president (1974); William Shanks is the authorizing agent, and John Collete is the manager of the District C. Enterprises, 819 13th Street, N.W., Washington, D.C. Collete and Kruger are directors of the Holiday. News, Ltd., 423 E. Baltimore Street, Baltimore, Maryland, with Charles Gillespie as director and Stuart Rombro as, incorporator. Kruger is the former president (1975); David Scotton signed for the mechanical license; William Bingham is a former vice president (1974-1975); Thomas Ayre is the former president (1972); John Jones is the current president, and Leroy Eichhorn is the current vice president of the 1405 H Street Corporation, 1405 H Street, N.W., Washington, D.C. Leroy Eichhorn is the vice president, and Dennis Pryba is the agent for Marlboro News, Inc., 7609 Marlboro Pike, Forestville, Maryland. Dennis Pryba is the owner; Larry Vineyard is the president; Dan Gottesman is the secretary, and Ted Nicely is the vice president of Cross Road Books, 5898 Leesburg Pike, Falls Church, Virginia. Dennis Pryba is the agent for Educational Books, 9130 Richmond Highway, Fort Belvoir, Virginia, and the agent for Suburban News, 8251 Georgia Avenue, Silver Spring, Maryland, with Donald Vossel as president. Barry Blum, a former employee of Suburban News, is currently a director for Northwest Books, Ltd., 600 Reistertown Road, Pikesville, Maryland. Ted Nicely (vice president of Cross Road Books) is president of M Street Enterprises, 3255 M Street, N.W., Washington, D.C., with John Jones (president of 1405 H Street Corporation) as a stockholder, Francis White as an incorporator, Kenneth Jones as the agent, and Art Dufrane as vice president. William Bingham, Thomas Ayre and Oscar Lebowitz are incorporators for String News Ltd., 522 Hat Street, Fayetteville, North Carolina, with William Shanks purchasing the city license, and Jeffrey Robbins as manager. William Bingham is vice president; William Shanks (agent for Capitol Books, Inc.) is the director; Jeffery Robbins is the manager; Oscar Lebowitz (listed is a clerk for Bon Jay Sales) is a director; Charles Kruger is the president, and William Pittler (attorney for Bon Jay Sales) is an incorporator for Bragg News, Inc., 4326 Bragg Boulevard, Fayetteville, North Carolina. Charles Kruger is the president of LeSalon, Inc., 804-810 14th Street, N.W., Washington, D.C., with William Bingham as vice president, C. B. Miller as the agent, and John Allison listed as the owner.

      9. Corporate Organizational Profile #8 (Chart K)

        Sovereign News Company is a wholesale pornography distributor located at 2075 E. 65th Street, Cleveland, Ohio. The company receives pornographic material from Star Distributors, Ltd., New York, New York; Parliament News Agency, Chatsworth, California; Action Publishers, St. Petersburg, Florida; Atlas News Distributors, Los Angeles, California; United Sales Distributors, address unknown; Global Press, Los Angeles, California; Star Media, Inc., New York, New York; Star Dust Enterprises, Pennsauken, New Jersey; Peachtree Discount. Distributors, Atlanta, Georgia; Southeast Productions, San Fernando, California; Southwest Distribution, Los Angeles, California; California International Distributors, Los Angeles, California; Lasse Braun Sex Shop, Amsterdam, Netherlands; Buy Rite Magazine Sales, North Hollywood, California, and Shore Innovations, Inc., New York, New York.

        Sovereign News Company distributes pornographic material to Royal News Company, Romulus, Michigan; Crown News Company, Camden, New Jersey; Majestic News Company, Youngstown, Ohio and Pittsburgh, Pennsylvania; Sun Dial News Company, Denver, Colorado; Capitol News Company, Chicago, Illinois; Noble News Company, Baltimore, Maryland; World Wide News Company, Beachwood, Ohio; Discount News Company, Cleveland, Ohio; Automatic Enterprises, Washington, D.C.; Bon Jay Sales, Baltimore, Maryland; Atlantic Magazine Company, Washington, D.C.; Imperial News Company, Depew, New York, and Canyon News Company, Glendale, Arizona.

        Additional information on the business activities of Sovereign News Company surfaced in a combined and coordinated law enforcement raid on the warehouses of Bon Jay Sales and Noble News Company, both located in Maryland, on August 23, 1976. Several uncashed checks, which totaled $11,201.31, made payable to Edward Stevens, were discovered. These checks had been sent_ from Castle News Company, Wisconsin (signature unreadable); New England News Company, Massachusetts (signed by Roger Carlton); Crown News Company, New Jersey (signed by Allan Crown); Majestic News Company, Pennsylvania (signature unreadable); Capitol News Company, 1 Illinois (signed by Theodore Pettipiece); A & A Distributors, Inc., Illinois (signature unreadable), and Slam Products, Inc., Michigan (signed by Samuel Ellmans). The checks from Castle News Company, New England News Company and Crown News Company, were handwritten by the same individual and each of the checks was stamped with an identical check writing machine using the registration number 8P68189. Edward Stevens was to receive these checks during the period August 17 to 31, 1976. A notation on the check from A & A Distributors, Inc., 1448 West North Avenue, Chicago, Illinois, indicated it had failed to clear a bank in Chicago on at least two occasions and a letter from Jack Gresser to A & A Distributors requested it be reissued.

        Additionally, a list was seized which revealed nine businesses throughout the country which had the common billing address of Sovereign News Company, Cleveland, Ohio. These businesses were Castle News Company, Wisconsin; New England News Company, Massachusetts; Crown News Company, New Jersey; Majestic News Company, Illinois; Capitol News Company, Illinois; Imperial News Company, New York; Noble News Company, Maryland; Royal News Company, Michigan, and Sun Dial News Company, Colorado. Documentation has been developed to establish that several businesses are linked to Sovereign News Company, who is a nationwide distributor. These include Canyon News Company, Arizona; Capitol News Company, Illinois; Majestic News Company,;Ohio; Royal News Company, Michigan; Imperial News Company, New York; New England News Company, Massachusetts; Crown News Company, New Jersey, and Nobel News Company, Maryland.

        The sole stockholder of Sovereign News Company is Reuben Sturman. His wife, Ester, is the secretary/ treasurer; Frank Steel is the statutory agent; David Zeitman and Keith Davie are incorporators; Samuel Joseph is the manager; Melvin Kamins is the manager, and Bernard Beckman is the representing attorney.

        Sturman is listed as a principal in the Cinematic Vending Corporation, Ltd., 36 Yonge Street, Toronto, Ontario, Canada, and as the statutory agent for the Royal News Company, 30024 Beverly Road, Romulus, Michigan.

        Sturman has been observed operating a 1976 Cadillac Seville with California Registration 189-PFH which is listed to Lyndon Distributors, 15755 Arminta Station, Van Nuys, California. In 1966, Sturman was indicted by a Los Angeles County Grand Jury with Milton Luros of the London Press Publishing Company, Los Angeles, California, for conspiracy to publish and distribute books which the California Supreme Court had ruled obscene. However, the United States Supreme Court ruled the material was not obscene. In March 1976, a Federal Grand Jury indicted Reuben Sturman, Samuel Joseph, Melvin Kamins, Joseph Zernic, Antoine Dostal, Fred Hirsch and Richard Johnson for the interstate transportation of pornographic films and magazines. Melvin Kamins is a manager of Discount News Company, co-located with Sovereign News Company. Other businesses co-located with Sovereign News Company are Palace Enterprises, Spot Discount Stores, Inc., and World Wide News Company. Judith Sturman, Joseph Sturman and Joyce Schwartz are incorporators with Sander Schwartz as the statutory agent of Spot Discount Stores, Inc. Sander Schwartz is also the statutory agent for World Wide News Company, with Franklin Blazer, Gladys Whitaker and Francis Yocabet as incorporators.

        Bernard Berkman was the representing attorney for William Pinkus of Rosslyn News Company, 7748 Santa Monica Boulevard, Los Angeles, California.

        Jack Heath is the president; Norma Heath is the secretary; Lee Kohrman is the attorney; Samuel Joseph is a shareholder; Frank Steele signs employees' checks; James Savage is the manager; Nahum Sturman is the vice president; Robert Coy is a director for Great Lakes News Company, T/A Imperial News Company, 35 Main Street, Depew, New York. In 1963, Reuben Sturman was the president and his wife, Ester, was the secretary/treasurer.

        Lee Kohrmen is also the attorney for Provincial Distributors, Ltd., 225 Louisiana Street, Buffalo, New York, with Wilbur Kemble as the president, and the Triangle News, Inc., 424 E. Main Street, Rochester, New York, with Stephen Baker as the president and Alan Maxwell as the secretary. An accountant firm, Krasney, Polk & Friedman located at 1605 Superior Building, Cleveland, Ohio, maintains the accounts for Triangle News, Inc., and the Imperial News Company. David Zeitman and Michael Nakon are the incorporators of Noble News Company, 6801 Pulaski Highway, Baltimore, Maryland, with Frank Steel as the president (1968); Melvin Kamins, Samuel Joseph and Maurice Escott as directors (1968); Herman Weiss as the manager, and Don Debow and J. Adams as directors. Noble News Company maintains a mailing address of 1605 Superior Building, Cleveland, Ohio, and a billing address of 2075 E. 65th Street, Clsveland, Ohio (Sovereign News Company).

        Gary Rosenthal, a director for the Baltimore News Center, 428 E. Baltimore Street, Baltimore, Maryland, also maintains the mailing address of 1605 Superior Building, Cleveland, Ohio, and 1225 King Street, Toronto, Ontario, Canada. Rosenthal is listed as the president of Bret Distributor, 100 W. 10th Street, Boston, Massachusetts. He was the original president of Beacon Distributors, T/A New England News, 215 A Street, Boston, Massachusetts, with Roger Carlton and Steven Baker as the current officers. Roger Carlton's signature (rubber stamp) is used on the employees' checks of the Fourth Avenue Adult News, Inc., South 4th Street, Ann Arbor, Michigan, and the News, Inc., North Land Road, Michigan, 48195. Steven Baker's signature (rubber stamp) is used on the employees' checks of the News, Inc., West Warren, Dearborn, Michigan, and the Michigan Avenue Bookstore, Michigan Avenue, Ypsilanti, Michigan. Roger Carlton is the president and Steven Baker is the director of Raleigh Books, Inc., County of Cuyahoga, Ohio.

        On March 24, 1977, Barbara Glin, a Notary Public employed as a secretary for Sovereign News Company, was interviewed by law enforcement agents at her residence, 16811 Kenyon, Shaker Heights, Ohio. Glin was shown a copy of a Secretary's Certificate which stated as follows:

        "SECRETARY'S CERTIFICATE

        "I, L. RAY VALUE, hereby certify that I am the Secretary of Combat News Company, a Delaware Corporation, authorized to transact business in Massachusetts and it appears from the records of said Corporation in my possession as such Secretary and as actually occurred at a meeting of the Directors duly called and ended on Thursday, January 14, 1977, the following resolution was passed:

        "RESOLVED that attorneys BARRY E. ROSENTHAL, WILLIAM COWIN and NELSON LOVINS be and hereby are authorized and empowered to appear for and represent this Corporation in all aspects of the trial and other proceedings in Suffolk County Criminal Court, Boston, Commonwealth of Massachusetts and to further represent this Corporation in all matters regarding legal representation; such authority to continue until terminated in writing by the Corporation; and that all prior representation is hereby nullified.

        "I do further certify that such Resolution is in full force and effect and has not been either amended or revoked, and that such Resolution and all action authorized thereby conforms to all applicable provisions of the Articles .of Incorporation and By-Laws of the Corporation.

        "WITNESS my hand and seal of this Corporation this 14th day of January, 1977.

        "/s/ L. RAY VALUE
        L. RAY VALUE - Secretary Combat News Company

        "STATE OF OHIO )SS
        CUYAHOGA COUNTY )

        "SWORN to before me this 14th day of January, 1977."
        /s/ BARBARA GLIN Notary Public"

        After reading the form for several moments, GLIN advised that the signature, as it appears on the lower righthand portion of the certificate above the line Notary Public, is a copy of her signature. She advised that in her capacity as a notary public employed by Sovereign News Company, 2075 East 65th Street, Cleveland, Ohio, she had occasion to notarize numerous signatures. GLIN advised that on this Secretary's Certificate, she recognized the name of L. RAY VALUE as the name which the interviewing agent had asked her about during a previous interview at her residence on February 15, 1977. GLIN reiterated her previous information that she had never heard of the individual L. RAY VALUE nor had she had occasion to determine if this individual actually existed. She further advised that generally individuals wishing to have their signature notarized appear before her in person. However, she refused to state that in all cases, when she notarizes signatures, do the individuals whose signature she is notarizing appear before her. GLIN advised that she continues to be employed as a secretary for MEL KAMINS at Sovereign News Company.

        Melvin Kamins, Samuel Joseph and Maurice Escott are directors of Regal Books, Inc., P.O. Box 1120, Watson Street, Baltimore, Maryland. Samuel Joseph, Melvin Kamins and Raymond Sloan are directors; Michael Nakon is an incorporator; Steven Baker is the secretary, and Morton Goss is the president of the Automated Vending Company, whose principle office is located at 1 E. First Street, Reno, Nevada. The peep show machine permit of Charles Books, Inc., 1827 N. Charles Street, Baltimore, Maryland, is in the name of Samuel Joseph.

        Morton Goss, Kevin McIntyre, Thomas Slobodzian and Raymond Sloan are officers, with Reuben Sturman listed as the principle in the Cinematic Vending Corporation, Ltd., 36 Yonge Street, Toronto, Ontario, Canada. Reuben Sturman is also the statutory agent for the Royal News Company, 30024 Beverly Road, Romulus, Michigan.

        Frank Steele is the president, and Morton Goss is the vice president of the Royal News Company, 2075 E. 65th Street, Cleveland, Ohio. Frank Steele is also the statutory agent of Majestic News Company, 3713 Oakwood Drive, Youngstown, Ohio, with Morton Goss as president. Morton Goss was the president of Crown News Company, 1171 Chestnut Street, Camden, New Jersey, which recently changed its name to Century Sales, 9252 Commerce Street, Pennsauken, New Jersey, with the billing address of 2075 E. 65th Street, Cleveland, Ohio (Sovereign News Company). Goss is listed as the owner of Palace Movie, 1233 Filbert Street, Philadelphia, Pennsylvania. The address 36 Yonge Street, Toronto, Ontario, Canada (Cinematic Vending Corporation, Ltd.) is also the mailing address of East Coast Vending Company, 260 Tremont Street, Boston, Massachusetts, whose president is Theodore Pettipiece, and the treasurer is John Allison. The East Coast Vending Company is still in existence on corporate papers but its function has been assumed by Coast Vending Company, 681 Washington Street, Boston, Massachusetts, with Joseph Saraceni as president, Ralph Saraceni as treasurer, and Thomas Zazzaro as director. East Coast Vending Company's address of 36 Yonge Street, Toronto, Ontario, Canada, is also the address of Jeffery Wood who is a director of New Book City, Inc., 239 Tremont Street, Boston, Massachusetts, along with John Reardon as president and Alan Maxwell as a director. Mark Heiblim is president of The Scene, Inc., 681 Washington Street, Boston, Massachusetts, which is co-located with Coast Vending Company. The Coast Vending Company supplies movie projectors to the businesses established in Joseph Palladino's organizational profile.

        Theodore Pettipiece is the president of Associated Rentals, Inc., 260 Tremont Street, Boston, Massachusetts, and the Cine City Art Theater, Inc., 675 Washington Street, Boston, Massachusetts, with Nicholas Caracasis as director. Nicholas Caracasis is the president of North Nevada Company, T/A Parisian Arcade, 219 West Second Street, and 740 South Virginia Street, Reno, Nevada, and the agent for Justice Books, Inc., T/A Paradise Books, 807 14th Street, N. W., Washington, D.C. Pettipiece's signature (rubber stamp) is used as the authorized signature on employees' checks for the following pornography businesses in Colorado and Michigan: Book Mart, Inc. (Central), Court Place, Denver, Colorado; Book Mart, Inc. (North), 84th & Valley Highway, Denver, Colorado; Book Mart, Inc. (East), East Colfax, Denver, Colorado; Book Shop, Inc., West 2nd Avenue, Denver, Colorado; 15th Street Magazine Exchange, 15th Street, Denver, Colorado; Books, 20th Street, Denver, Colorado; Tip Top Bookstore, 124 Monroe Avenue, Detroit, Michigan, and The Book Shop, Inc., Courtland, Jackson, Michigan.

        Pettipiece is also the president of Automated Services Consultants of California, which maintains two addresses, 15745 Stagg Street, Van Nuys, California (parent company), and 6800 N. 55th Street, Glendale, Arizona (subsidiary), with Phillip Santhon as the operator for the latter address, John Allison as the secretary, Robert Coy as the treasurer, and Kim Short as the manager.

        Theodore Pettipiece is also the president of Sun Dial News Company, 2650 W. 2nd Avenue, Denver, Colorado, and is the authorized signer of employees' checks for Capitol News Agency, 3400 N. Kedzie Avenue, Chicago, Illinois, whose manager is Al Bloom, and an officer is Stanley Seidler. The Sun Dial News Company, Capitol News Agency, Castle News Company, 4551 N. 125th Street, Butler, Wisconsin, and Majestic News Company, 922 West North Avenue, Pittsburgh, Pennsylvania, maintain the billing address of 2075 E. 65th Street, Cleveland, Ohio (Sovereign News Company).

        The operation of pornography businesses in Arizona is primarily through the figures of Erland Bartanen and Phillip Santhon. Erland Bartanen's operation appears to be independent in nature. However, Bartanen's source for pornographic supplies is dependent upon the Black Amusement, Inc., T/A Canyon News Company, which is currently the only identified supplier of pornographic material in Arizona. Canyon News Company receives its supplies from Parliament News Agency, 21314 Lessen, Chatsworth, California.

        While there are independent retail operators, the activities of Bartanen, Santhon, Lyle Cox, Manuel Buso, Valeri Trambitas and Patrick Baca govern the distribution of films, magazines, books, rubber goods, novelty items and film video viewing devices in Arizona.

        Phillip Santhon has no criminal record in Arizona. However, he was charged with four misdemeanor counts of commercial exhibition of obscene items in Arizona. While this case was pending trial, Black Amusements, Inc., pled guilty to two counts and agreed to close the Le Sex Shoppe at 6 W. Washington Street, Phoenix, Arizona, in exchange for dismissal of charges against Santhon. Santhon does have prior arrests by the Los Angeles County Sheriff's Office. Phillip Santhon originally appeared in Phoenix on May 29, 1975, when he began applying for various privilege tax (sales) and film video licenses on behalf of Erotic Words and Pictures (E.W.A.P.) and the Automatic Vending Company.

        Phillip Santhon maintains the business tax license and Robert Coy the film license for the Pleasure Palace, 1524 E. Van Buren, Phoenix, Arizona, and Barney's Bookstore, 1421 E. McDowell Road, Phoenix, Arizona. The property used by both bookstores is owned by Milton & Beatrice Luros. Milton Luros also owns Parliament News Company, 21314 Lessen, Chatsworth, California. Phillip Santhon and Gregg Dudley are the lessees of the Southside Bookstore, 4615 S. Central Avenue, Phoenix, Arizona, with the film license'in Robert Coy's name.

        Phillip Santhon is also the president of Black Amusements Company, T/A Arizona Bookstore, T/A Canyon News Company (maintains the same address as 6800 N. 55th Street, Glendale, Arizona), with Gregg Dudley as the secretary. Dwain Esper is the lessee; Gregg Dudley obtained the business tax license, and Robert Coy obtained the film tax license for the Paris Lounge (currently closed), 315 E. Washington Avenue, Phoenix, Arizona. Dwain Esper is the president and Millicent Wratten is the secretary for the MJW Enterprises, Inc., 315 E. Washington, Avenue, Phoenix, Arizona. Robert Coy signed for the film license for the Mini Vue, Adult Theater, 2438 E. McDowell Road, Phoenix, Arizona, which is owned by William Bates, with Donna Dees as the licensee and Cletus Hibner as the property owner.

        Gregg Dudley signed the business. tax license; Robert Coy signed the film tax license, and Narhan Tager is the property owner of Le Sex Shoppe, 6 W. Washington, Avenue, Phoenix, Arizona (currently closed). Nathan Tager is also the property owner of 2 W. Washington Avenue, Seattle, Washington, which houses Ellwest Stereo Theaters, Inc., T/A Ellwest Stereo Theater with the business address of 500 Wall Street, Seattle, Washington.

        The manager is Fred Holton, with John Ebert as the agent, and Larry Trambitas as the lessee for the Ellwest Stereo Theater in Seattle, Washington. Larry Trambitas is the director of the Western Amusement. Company, Inc., 3126 Elliott Avenue, Seattle, Washington, and the director of T&T Films, Ltd., 1106 Grosvenor House, 5th & Wall Streets, Seattle, Washington. The corporate officers for the Ellwest Stereo Theater, 190 Union Street, Memphis, Tennessee, are Larry Trambitas as president, John Ebert as secretary/ treasurer, David Capp as manager, and William Cooley as the vice president. William Cooley signed the occupancy permit; Larry Trambitas, Vesta Trambitas and Wesley Nashman are the directors, with Sterling Stevens, Bonny Hines and Robert Bodoin as the incorporators of the Ellwest Stereo Theaters of Washington, D.C., 1418 Eye Street, N.W., Washington, D.C. Larry Trambitas is the president, with Wesley Nashman, Vesta Trambitas and William Cooley as board members of the Ellwest Stereo Theater, Inc., 727 7th Street, New York, New York. Larry and Vesta Trambitas are the directors of the Ellwest Stereo Theaters, Inc. of Texas, 310 Main Street, Ft. Worth, Texas. Larry, Vesta and Valerie Trambitas are officers of the Ellwest Stereo Theaters, Inc. of Jacksonville, Florida.

      10. Synopsis
      11. Corporate Organizational Profile #9 (Chart M)

        Michael Zaffarano is identified by the U.S. Justice Department as a Caporegime (captain) in the LCN Bonnano Family. He is the president of the D.C. Playhouse, Ltd., T/A D.C. Playhouse Theater, 727 15th St., N.W.,Washington, D.C., along with Stu Segall, Norman Arno, John Ausbrook and Saul Heller as directors and Marilyn Lizzio, Mary Walls and George Ward as incorporators.

        Zaffarano resides at 2848 Riverside Drive, Wantagh, Rhode Island and stays at 1310 New Hampshire Ave., Apt. #707 when in Washington, D.C. His arrest record dates to 1947 and includes charges of assault and robbery, interstate transportation of stolen securities, grand larceny, burglary, interstate transportation of stolen property and the interstate transportation of pornography.

        On November 11, 1975, Mr. Zaffarano told an F.B.I. undercover agent that he is the main distributor of pornographic films in the United States and stated emphatically that if anyone buys or opens any theaters in Washington, D.C. it would be him.

        Marilyn Lizzio, Mary Walls and George Ward (incorporators for the D.C. Playhouse Theater) are also incorporators for Denmark Publications, Inc., T/A Denmark 1/2 Books and Movies, 822 F St., N.W., Washington, D.C., with Jacob and Ruby Kramer and Ely Allman as directors and Mike Casey as the agent. Mike Casey is also the agent and Jacob Kramer is the owner of Denmark Cut Rate Books, 918 14th St., N.W., Washington, D.C., and the Life Size Movie Arcade, 523 9th St., N.W., Washington, D.C., Jacob Kramer is also the owner of Denmark 1/2 Price Store, 529 9th St., N.W., Washington, D.C., and the director of the Book Nook, Inc., 216 East Baltimore St., Baltimore, Maryland, along with Ruby and Joyce Thibert as directors. Marilyn Lizzio, along with N. Weir and Richard Rizzi, are also the incorporators for the 14th Amusements, Inc., T/A Casino Royale Theater, 806 14th St., N.W., Washington, D.C., along with Billy Cole as a director and Bruce Whetshine as the owner. Bruce Whetshine is the listed owner of the Casino Royale Theater and a director of the Adam & Eve Book Store, Inc., 815 14th St., N.W., Washington, D.C., along with George Cole and Herbert Cole as directors. The incorporators for the Adam & Eve, Inc., are Fred Bennett, G. Markle and Ronald Recht.

        Michael Zaffarano owns the Pussycat Cinema, 1603 Broadway St., New York, New York and orders supplies for United American Theater Co., T/A Pussycat Cinema, 700 Washington St., Boston, Massachusetts, for his brother-inlaw, Anthony Mascolo, who is listed as president. Anthony Mascolo is also the president of Westend Theater, Inc., 75 Causeway St., Boston, Massachusetts and the National Land Corporation, 690 Washington St., Boston, Massachusetts.

        In February, 1976, the National Land Corporation concluded a contract with a construction firm to renovate the exterior open theater vestibule of the United American Theater Co., T/A Pussycat Cinema, 700 Washington St., Boston, Massachusetts. The National Corporation issued a $10,000.00 check to the construction firm dated February 10, 1976 drawn by the United American Theater Co. Investigation revealed the $10,000.00 was a loan through P.O. Box 362, Canal Street Station, New York, New York, 10013. The P.O. Box 362 was opened on September 18, 1968 by Ted Rothstein who signed as president for Star Distributors, Ltd., 150 Lafayette St., New York, New York, 10013.

        One of the first films shown at the D.C. Playhouse Theater, titled "Defiance", was produced by Stu Segall & Associates. Stuart Segall is the owner of Stu' Segall & Associates and the Miracle Film Releasing Company. These two companies maintain the same addresses at 8564 Melrose Ave., Los Angeles, California and 165 West 46th St., New York, New York. Mr. Zaffarano is recorded as vice president of both companies.

        In 1971 and 1972, Stuart Segall, Theodore Gaswirth and William Amerson were recorded as the owners with Charles Krause as the incorporator of Capricorn Industries, Beverly Hills, California, as the Los Angeles County, California Recorder's Office. Theodore Gaswirth is an incorporator, Michael Collela is a director and Fred Alfano is the secretary/ treasurer of Lyndon Distributors, 15756 Arminta,Van Nuys, California. Michael Collela, Fred Alfano, Sharon Penner, Del Wells and Patricia Smith are directors of London Enterprises also located at 15756 Arminta, Van Nuys, California. Michael Collela is the Chief Executive/ Financial Officer of Briarwood Corp., 15754 Arminta, Van Nuys, California, with Richard James, Scott Brastow, Robert Braverman, Roland McMillian and Barbara Friedman as directors. Norman Sovereign, Fred Alfano, Michael Collela and Theodore Gaswirth are the incorporators of NFM which is the parent company of Erotic Words and Pictures (EWAP) whose incorporators are Mary Turner, Howard Cohen, Howard Green and Rita Grossman. Mary Turner and Robert Turner are the incorporators of Turner Enterprises and Howard Green is the vice president of San Oaks Distributing, Inc., 62 Belvedere St., San Rafael, California, with Donald Warnecke as the owner. Howard Green and Reuben Sturman own 100% of the stock (50% each) in Charles Books, 1927 North Charles St., Baltimore, Maryland. Green and Struman also own 50% of the stock (25% each) of Castle News Company, 4551 North 25th St., Butler, Wisconsin with the remaining 50% of the stock owned by Wilson and Company, Cleveland, Ohio. Crown News Company's (name currently changed to Century Sales, 9252 Commerce St., Pennsauken, New Jersey) merchantile renewal license in 1975 listed Allan Crown as the secretary and Morton Gross as the president. The merchantile renewal license for Crown News Company in 1977 listed Allan Crown as the applicant. Allan Crown, Alvin Friedkin and Richard Sherwin are the incorporators of the Revel Sales, Inc., 15101 Keswick St., Van Nuys, California. Richard Sherwin is the Chief Executive Officer, Pedro Mendoza is the secretary, Charles Swan and J. Montesano are the directors of the Marquis Publishing Corp., also located at 15101 Keswick St., Van Nuys, California.

        Rita Grossman (incorporator for Erotic Words and Pictures) is the secretary/treasurer. of Parliament News Co., 21314 Lassen, Chatsworth, California, with Paul Wisner as president, Jack Shulem, Franklin Laven and June Blair as directors. A subsidiary of Parliament News Company is Centaur Distributing Company whose manager is Jack Wolf. Centaur Book Distributing Company owns the Turk Street News, 66 Turk St., San Francisco, California; Mission Street News, 2075 N. Mission St., San Francisco, California, and Folsom Gultch, 600 Folsom St., San Francisco, California. June Blair (director for Parliament News Co.), Herman Malorrus, Leonard Martinez, Max Cohen and Judy Lechuga are directors for the Golden State News Co., 1785 W. Adams St., Los Angeles, California. Judy Lechuga is the secretary, Alvin Tapper is the Chief Executive Officer, Pat Alexander and Marilyn Thornberg are directors of the California Publishers Liquidating Corp., 2611 S. Halldale Ave., Los Angeles, California. Judy Lechuga is the secretary, Marilyn Thornberg, Ronald LaBowe and Isabel Oros are the directors, Jerome Kult is the Chief Executive Officer and Michael Warner is the Chief Financial Officer of the Sutton House Publishing, Inc., 4202 W. Jefferson Blvd., Los Angeles, California.

        Alvin Tapper is also the owner of FCA Films, Inc., 2211 Union St., Los Angeles, California, and the California and Pacific Liquidators, 2611 Halldale Ave., Los Angeles, California. Stephen Golden is the husband of Irene Golden, who is the sister of Theodore Rothstein of Star Distributors, Ltd. Stephen Golden is the Executive Officer of FCA Films, Inc.

      12. Synopsis

  4. Organized Crime Involvement (Other than Corporate Organizational Profiles)

    The Mitchell Brothers Film Group, San Francisco, California is a major supplier of high quality XXX rated pornography films to the Washington, D.C., Playhouse Theater.

    In 1973, Arthur and James Mitchell produced a film titled "Behind the Green Door" which was very successful. In October of 1973, the Mitchell brothers said they were visited by two men, Robert DeSalvo and James Bochis, who wanted to obtain national distribution rights to the film for one of their companies based in Ft. Lauderdale, Florida. "He wanted to distribute our film, offering us a 50/50 split," said Arthur Mitchell. "We told them that we already made distribution arrangements." They replied that if we didn't give the film, pirated versions of it would be playing around the country in a week. We turned them down, but a couple of weeks later they called back and made another effort. We turned them down again; arld a short time later, pirated versions of the film started playing in major cities across the country. We obtained restraining orders, but before we could stop them they hurt us badly. They wiped out several key markets for us: Miami, Dallas and Las Vegas.

    Robert DeSalvo was convicted in 1976 in federal court in Memphis, Tenn., on a charge of conspiracy to ship obscene material interstate along with Melvin Friedman, Michael Cherubino, Anthony Arnone and Anthony Peraino (listed by the United States Justice Department as a soldier in the LCN Colombo Family) involving the businesses of Damiano Productions, Fidelity Equipment & Leasing Corp., and Bryanston Distributors. Melvin Friedman was also found guilty of interstate transportation of obscene materials in the United States District Court of Oklahoma City involving the business of Peachtree National Distributors. At this time, DeSalvo is a federal fugitive.

    Anthony Arnone has been quoted as saying Anthony Peraino mediated a dispute between himself and another movie theater operator about local screening rights to "Deep Throat." Eventually, Arnone said, Peraino gave him Florida distribution rights and the other man, Robert DeSalvo, got rights for most of the rest of the nation.

    Gerald Damiano sold his interest in the movie to Anthony Peraino for $25,000. When Damiano was asked by a New York Times reporter about the seemingly low price he received for the movie rights, he was quoted as saving, "I can't talk about it . . . You want me to get both my legs broken." Peraino was arrested with Peter Marchese and Philip Sayona for arson of the Tilton Theater, Northfield, New Jersey.

    Between October 18, 1972, and October 24, 1972, Peter Salanardi aka "Sonny Boy," and Nicholas Musolino were observed in Los Angeles meeting with Michael Zaffarano. At the same time, Salanardi and Musolino were being sought for the murder of Carlo Lombardi in New York. Both the victim and the two suspects were involved in large scale heroin distribution in that city. While in Los Angeles, California, Salanardi and Musolino were guests at the homes of Stuart Segall and Theodore Gaswirth and were observed driving Gaswirth's vehicle. When Gaswirth lived in New York, Anthony Mascolo lived across the street. Mascolo visited with Gaswirth in July 1975 when Mascolo was living in the San Fernando Valley area of Los Angeles. Theodore Gaswirth is currently operating the Lyndon Industries, 15756 Arminta, Van Nuys with Michael Collela and Fred Alfano as partners. Recently, a search warrant executed by the Los Angeles Police Department at this location resulted in Gaswirth's arrest for sale of pornographic materials and a violation of California Weights and Measures due to short footed films. In November, 1973, office of.the District Attorney, Los Angeles forwarded a request for information to the Cleveland Police Department concerning Ted Gaswirth and his telephone calls to 216/881-1099 of Cleveland, Ohio. Investigation revealed the telephone number was that of Discount News Co., 2075 E. 65th St., Cleveland, Ohio (Sovereign News Company's address).

    Samuel Haimowitz, Thomas Sinopoli and Dominick Raffone have been observed in the Los Angeles office of Mr. Zaffarano's businesses, Stu Segall & Associates and Miracle Film Releasing Company. Dominick Raffone, Michael Rizzitello (former member of the Joey Gallo LCN Family in New York), Jack LoCicero, James Frat'ianno and Thomas Ricciardo (member of the Joseph Columbo LCN Family in New York) were indicted by a Los Angeles federal grand jury on charges of attempting to extort up to $20,000 from local pornographers and a dummy pornography business set up by the F.B.I. Also, a known pornography distributor in Minneapolis, Minnesota, Ferris Alexander was stopped in Los Angeles, California, in the company of William Bittner, also known as William Haimowitz on February 11, 1974. On May 15, 1975, a truckload of pornographic materials was hijacked in St. Paul, Minnesota. The owner of the truck and person reporting the crime was Michael Kaplins of 2014 Westchester, Baltimore, Maryland. At this time, Mr. Kaplins stated that the shipment was being shipped from Bon Jay Sales,. 6601 Moravia Park Drive, Baltimore, Maryland, (formerly 600 Aisquith St., Baltimore, Maryland) to a party named Ferris and gave a phone number which was later traced to Ferris Alexander. On September 8, 1975, several cartons of pornographic booklets being shipped by Emery Air Freight broke open. Emery officials refused to deliver the shipment and notified federal and local authorities. The shipment was found to contain material displaying young children and adults in pornographic activity. The pornographic material was being shipped from Atlantic Distributors, #9 Ford St., Providence, Rhode Island, to magazine Agency, 419 Hennepin Ave., Minneapolis, Minnesota, which is owned by Ferris Alexander.

    In 1970, Ferris Alexander was convicted of interstate transportation of obscene material in federal court, along with Samuel Manarite, a member of the Vito Genovese Family and Richard J. Portela. in 1972, Ferris was sentenced to Sandstone Penitentiary where he served 9 of 18 months and paid a $20,000 fine.

    An identified supplier of pornographic films to Alexander through correspondence, as indicated below, is William and Lewis Mishkin and their Motion Pictures, Inc., 1501 Broadway, New York, New York, dated November 12, 1975:

    I hope that by now you have had your first playdate on the INTIMATE TEENAGERS, and that the results were as good as they have been all over the country.

    I would appreciate learning when you will be through with the prints. I am not rushing you, but we have been considerably more successful with this film than we had originally anticipated, and with the negative in Europe, this has caused us a print problem.

    I have several other films that you might be interested in, including THE FILTHIEST SHOW IN TOWN (Harry Reems and Tina Russell), ADULT PLAYPEN...

    A partial list of recorded calls from Alexander's main warehouse at 20 North 14th St., Minneapolis, Minneapolis 1201 revealed telephone calls to several known businesses and individuals involved in the pornography industry such as Kenneth Guarino, William Mishkin, Stu Segall & Associates, Star Distributors, Ltd., David Grama, Robert Eugene Smith, Samuel Haimowitz, Lyndon Distributors, Bon Jay Sales, Inc., Norman Arno and the Mitchell Brothers Film Group.

    William Bittner was arrested for operating a warehouse in which 1.5 million dollars of hardcore pornographic material was confiscated. Also arrested with William Bittner was Anthony Zappi who is the secretary/treasurer of Teamsters Union 854 in New York City. William Bittner is currently operating the Lauderdale Beach Hotel, 101 S. Atlantic Blvd., Ft. Lauderdale, Florida. Donald Embinder is the president of the hotel. Ronald Zappi is an employee, as well as Robert Barkow, who is also the production consultant for Blueboy Magazine.

    Bittner also operates the 'Suki, Inc., dba Pojo, a hardcore pornography distribution business with his step brother Samuel Haimowitz. William Bittner stated to F.B.I. agents he sometimes used his step father's name, William Haimowitz. When the Suki warehouse was searched it was established that they were doing a nationwide business. Records indicated that they were grossing $40 to $50 thousand per month on magazine sales alone. When added to their film distribution business, the estimates of their yearly sales was grossing about 1-1/2 million. The following excerpt from the 5-15-73 issue of the LA Times gives an indication of Bittner's pornography operations at the time: "One of the key witnesses in the second round of indictments was Arthur Pellon, who told the grand jury he was employed as a driver and bodyguard for Suki, Inc. Pellon told the grand jury, in testimony which is now public record, that during the past year he made three different trips to the East Coast with locked briefcases, which he delivered to the Zappis. He testified that those trips to the East began after he overheard one of the managers of Suki, Inc. remark: "We are making plenty of money, we ought to see if we can get some money back to the East Coast." Pellon testified that the other principals of Suki, Inc. immediately told the man to "keep his big mouth shut." Although he never saw the contents of the briefcases, Pellon said he believed them to be full of money. On each of these trips, he said, he was under strict orders from his Los Angeles bosses to keep the briefcases in his hands until he turned them over to the Zappis. Pellon said that his boss in California was William Bittner named in the second indictment. Pellon testified that Bittner intimated that he had Mafia connections and was given "a high ranking position in California as a present" for his service in underworld wars. Pellon also detailed for the jury his work as a collection agent for Suki, Inc. and its predecessor, Pojo, Inc. He was asked by Deputy District Attorney Oretta Sears, during the grand jury hearing, what his instructions were with regard to collection of overdue accounts. "Either get the money or a piece of their ass," Pellon said. He said he was sent out on four collections, three of which were settled immediately. "One of them I had to bust up a little bit and then he paid," Pellon said.

    William Bittner was indicted as the result of an investigation by the Federal Bureau of Investigation for the sale and distribution of obscene, lewd, lascivious and filthy magazines along with Thomas Sinopoli, Peter Sinopoli, Donald Epstein, Jim Rhoat, Samuel Haimowitz, Ronald Foreman and Donald Jacobson. The indictment further indicted that the above individuals unlawfully, willfully and knowingly did conspire to combine, confederate and agree together, with each other and others, and through their use of the Atlantic Magazine Company, Automatic Enterprises, Inc., Suki, Inc., also known as Pojo and as R & M Productions and Age of Majority, Inc.., did commit offense against the United States by transporting interstate obscene material. Donald.Epstein's arrests date back to 1971 and includes two arrests for indecent publications, 23 counts for the possession of unregistered guns and for the possession of a machine gun.

    The key officers in Epstein's corporate structure profile are Donald Epstein, president; Rebecca Crone, vice president; Isabel Kramer, director;and Richard Plummer, agent for the Automatic Enterprises, Inc., 412 10th St., N.W.,. Washington, D.C. They hold the same corporate structure for the Automatic Amusement, Inc., T/A Automatic Amusements, 437 9th St., N.W. Washington, D.C., except for Isabel Kramer who is listed as the secretary. Richard Plummer is also the agent for Gem, Inc., T/A Capitol Amusements, 1214 New York Ave., N.W., Washington, D.C., with Henry Reensynder as president. Reensynder is also the owner of Variety Books, 1026 14th St. N.W., Washington, D.C., Rebecca Crone is the vice president and Isabel Kramer the treasurer of the Fine Arts Theater, 633 Main St., Buffalo, New York. Hyman Tash was the registered agent (1956) and Richard Plummer is the registered agent (1970) for the Enterprise Amusements, Inc., 413 9th St., N.W., Washington, D.C., T/A Enterprise Amusements, 521 9th St., N.W., Washington, D.C., and T/A Enterprise Amusement, 502 9th St., N.W., Washington, D.C. Hyman Tash is an officer, Paul Downey, vice president, Henry Levine, current president, C. Ann Henze, treasurer, Daniel Flowers was the president (1976) and Catherine Steele, agent for the United Theaters, Inc., 446 West Federal St., Youngstown, Ohio, T/A Gayety Theater, 508 9th St., N.W., Washington, D.C. Catherine Steele is the agent, Rebecca Crone, vice president, Daniel Flowers, president and James Rhoat, manager of the Automatic Amusements, Inc., T/A Playland, 413 9th St., N.W., Washington, D.C. James Rhoat is also the owner of Seaboard News, Pt. Pierce, Florida. Henry Levin, C. Ann Henze and Daniel Flowers, previously mentioned as officers of the United Theaters, Inc. are also vice president, secretary/ treasurer and president, respectively along with Joel Hirschhorn as the registered agent for the Florida Literary Corporation, 180 N.E. 79th St., Miami, Florida. Henry Levin is president and Isabel Kramer is secretary of the United Theaters of Florida, Inc., 17745 N.E. 9th Place, North Miami, Florida. Joel Hirschhorn is the registered agent for Miami Bargain BookS, Inc., 6020 South Dixie Highway, South Miami, Florida, the Atheneum, Inc., 25 West Flagler St., Miami, Florida, Artistic Books, Inc., 6020 South Dixie Highway, Florida, and the NBF Theaters, Inc., 25 West Flagler St., Miami, Florida. Rory Brown is the president and Barry Brown is a director of Miami Bargain Books, Inc. Rory Brown is the secretary/treasurer, Robert Brown is the president and Fay Brown is the vice president of the Atheneum, Inc. Fay Brown is the secretary and Herbert Brown is the president of the Artistic Books, Inc. Paul Downey is also a director for the NBF Theaters, Inc. On July 23, 1976, indictments were returned on 207 counts of obscenity and conspiracy relating to the operating of Overstock Book Company, Inc., also known as Timely Books, Inc., 519 Acorn St., Deer Park, New York, on Robert Brown and Barry Brown.

  5. Conclusion

    The pornography industry is characterized by a vertical distribution and a pyramid structure with a limited number of documented distributors within individual states. Documentation has been obtained to establish that pornographic material is initially supplied to national distributors who then sell to inter-state distributors who, in turn, distribute to intra-state distributors.

    This limited number of pornography distributors may indicate the lucrative profits in the distributorship and production of pornographic material with the capability of dictating prices to independent bookstore owners. As an example of the high profits involved, the following is provided. A magazine can be produced for approximately fifty cents; wholesaled for five dollars and retailed for ten dollars. This computes to a 1900 per cent profit from production to consumer sale. In general, there is no competition or price wars which indicates price cqntrol. If a pornography distributor has control of a distribution network, owned companies that provided peep show projectors, built peep show booths for bookstores, collected the coins from peep show machines from bookstores owned by "straws" on corporate papers and was able to purchase projectors, films, books, etc., wholesale, the profit would even be greater. This profit making mechanism is currently in existence. An example is Bon Jay Sale's organizational profile which consists of s peep show coin collector business (Alpha Sentura Businesses Services), a carpentry business to build peep show booths (Woodwork, Inc.), a business to repair peep show projectors (Centre Vending Co.) and controls several bookstores in Maryland, Washington, D.C., and North Carolina.

    Additionally, there are an unrelated number of individuals involved in the sale of pornographic material that are dependant upon inter-state distributors for supplies. This investigation revealed various methods used by pornography entrepreneurs to successfully operate their business and avoid detection by law enforcement. Some of these methods are:

    1. Names of corporate officers are used without the individual's knowledge or consent.
    2. Notary Publics are employed to notarize signatures without confrontation of signees.
    3. Rubber stamps of signatures are used without the authorizing individual's knowledge.
    4. Periodic changing of corporate names.
    5. Controllers do not appear on corporate papers but are major stock holders.
    6. Pornography entrepreneurs appear as corporate officers for a legitimate business which may have pornography distributors as subsidiaries.
    7. Companies owned or controlled by major distributors deliver pornographic material automatically to their subsidiaries.

  6. Recommendations

    1. Another conference be held for the purpose of exchanging updated material thereby keeping the joint investigation ongoing and current.
    2. Criminal financial discrepancies be brought to the immediate attention of the Internal Revenue Service. (Documentation of false invoice payments, skimming, hidden ownership, money laundering operations and bankruptcy frauds.)
    3. The United States Justice Department be provided with all documentation indicative of violations of monopoly or antitrust laws.
    4. A request be made to Congress and state legislators for assistance in exposing organized crime involvement in this industry.
    5. Members of this joint investigation bring the results of this investigation to the attention of their local prosecutors and request their assistance in local law enforcement effort in obscenity areas. Members should seek cooperation also from local agencies charged with the task of licensing and incorporating pornography outlets to insure applicants comply with the law.
    6. Assistance be provided to the Federal Bureau of Investigation in matters involving interstate violations and organized crime involvement.

Appendix Five

United States Department of Justice Organized Crime Involvement in Pornography June 8, 1977

United States Department of Justice June 8, 1977 Organized Crime Involvement in Pornography

Most of the production and distribution of pornographic material seems to take. place on the east and west coasts with the west being dominant. It is thought that as far as films are concerned, about 60% of the production takes place in and around Los Angeles with New York taking second place. Members of La Cosa Nostra (LCN) moved into this lucrative field within the last ten years and their involvement apparently is on the increase.

This report, prepared by Intelligence Analyst will discuss LCN involvement in pornography by state. Those states with direct LCN involvement will be mentioned first followed by those with indirect ties to the LCN.

California

The key organized crime figure involved in production and distribution of pornography in California, and possibly the entire nation, is thought to be Michael Zaffarano, capo in the Galante LCN Family. He is regarded as that family's West Coast representative, although he is known to have dealings with all of the organized crime families involved in the California operations. Zaffarano and his partners, Stewart Charles Segall and Tommy Sinopoli, operate Miracle Film Releasing Corporation in Hollywood. This company produces and distributes 16mm and 35mm feature films. There are indications that Sinopoli is associated with the LCN DeCavalcante in New Jersey. Zaffarano is also the president of Stu Segall Associates which distributes pornographic films and has offices at 1600 Broadway, Manhattan, and 8564 Melrose Avenue, Hollywood, California. Zaffarano and Stu Segall are the directors of a nationwide organization of "Pussycat" theaters which has theaters in Washington, D.C., Los Angeles, and San Francisco.

With Stu Segall and Norman Arno, Zaffarano is involved in the D.C. Playhouse Ltd. in Washington, D.C. He is the owner and is listed in the corporate records as the President, Treasurer, and Director of the Corporation. Arno and Segall are also listed as Directors of the Corporation. The corporation was formed in 1974 and Zaffarano then subleased the theater to Robert Gage, who operates it with Saul Heller. The pornographic films shown at the D.C. Playhouse are supplied by Zaffarano from New York and Los Angeles, primarily from Stu Segall Associates. Norman Arno also does business in Los Angeles as S & L Distributors, dealing in 8mm films and magazines. Arno has arrests for both local misdemeanor and Federal felony obscenity charges.

Zaffarano has also been largely associated with Noel Bloom and Theodore Gaswirth. Noel Bloom, doing business as California International Distributors and Cinema Classics, is a major Los Angeles based distributor of 8mm films. He has been arrested several times on local misdemeanor obscenity charges and has one Federal arrest for Interstate Transportation of obscene matter (ITOM) charges which resulted only in a guilty plea by the corporation. Theodore Gastwirth, doing business as T.C. Associates, is also a major Los Angeles based distributor of 8mm films. He, too, has several local misdemeanor obscenity arrests.

Each of the other main organized crime families in the east has a full time representative on the West Coast. Robert DiBernardo is the representative for the DeCavalcante Family, Thomas Ricciardi for the Colombo Family, and William Haimowitz for the Gambino Family. These representatives give every indication that they are working together in the pornography operations. They are each associated with numerous pornographic businesses. Thomas Ricciardi has been linked to William Noel Fine who has been active in Los Angeles area pornography. He has operated Fine Films and Billy Fine Productions. William Haimowitz was raised by LCN Gambino member Ettore Zappi and has made statements that Zappi had sent him to California to control or corner the pornography market for that family. DiBernardo is a partner in a pornography operation with Theodore Rothstein. Intelligence indicates that the LCN DeCavalcante furnishes funds to member Frank Cocchiaro who in turn provides financing to DiBernardo and Rothstein.

LCN Los Angeles underboss, Aladena Fratianno, is allegedly directing the shakedown of pornography dealers in the Los Angeles area in an attempt to control pornography in Southern California. A Federal grand jury is now investigating the extortion of money from an undercover FBI pornographic company. The alleged extorters were Michael RizzitellO (LCN Bonanno member; considered Fratianno's right-hand man), Jack Locicero (LCN Los Angeles member), and Thomas Ricciardi, who was mentioned above as the LCN Colombo's West Coast representative.

LCN member Pasquale John Antonelli moved to California from New Jersey in 1965 and has prospered from operating massage parlors, pornographic bookstores and movies. Because of his financial success, he is becoming the nucleus of a small band of hoodlums of Italian ancestry who have moved to the area from the Northeast coastal region. Antonelli is known to be involved in pornography in the downtown section of San Diego. It is believed that Tom and Mike Aquilante (who have direct ties with the LCN in Newark and Bridgeport, Connecticut) and Tom and Vincent Campisi all have a common interest in the pornography field. Antonelli is reportedly the major figure of the group and there are numerous fronts for his operations. These individuals are the owners of a concentrated number of store front operations in a four square downtown block of San Diego featuring adult bookstores, peep shows, massage parlors, and hard-core movies. John Aquilante is presently on three years probation for pornography violations.

Reuben Sturman of Cleveland, Ohio, though not directly connected to the LCN, is a key figure in the pornography industry and seems to be well-established in California. His operation will be discussed at length in the section on Ohio. The following is a list of known West Coast operations which are controlled by Sturman, showing the principals and the type of materials produced and/or distributed.

Parliament News, Los Angeles
Milton Luros
Soft and Hard-Core Magazines

Pacific News, Los Angeles
Milton Luros
Soft and Hard-Core Magazines

Lyndon Distributors, Los Angeles
Ted Gaswirth
8mm Hard-Core Films

Now News, Los Angeles
Mike Colella
Hard-Core Magazines

Ewap Inc., Los Angeles
Fred Alfuno
Soft-Core Magazines

Cinema Classics, Los Angeles
Noel Bloom
8mm Hard-Core Films

Cline Labs, Los Angeles
Richard Sherwin
Films and magazines published for Sturman

KNS Publishing, Los Angeles
Richard Sherwin -- emerging as main printer/distributor for Sturman

NFM Corporation, Los Angeles
Mike Colella
Films

Mike Colella, operator of Now News and NFM Corporation in Los Angeles allegedly works directly for Sturman and has assisted in his efforts to infiltrate the southern California area.

Milton Luros of Parliament News is a major publisher and distributor of magazines in Los Angeles. He has previously been convicted of misdemeanor obscenity charges. He and Paul Wisner reportedly control a retail bookstore in Sacramento. Luros at one time controlled most of the distribution of books and magazines in the Los Angeles area. His control has dwindled to about 5%. Luros, his corporate officers, and five of his corporations were indicted in the Central District of California for mailing obscene material. The corporations, which are London press, Inc., Jaybird Enterprises; Parliament News, Inc, Seven Towers, Inc., and American Art Enterprises, Inc. were found guilty. The corporate officers Milton Luros, Beatrice Luros, Robert Accietta, Paul Wisner, and Robert Reitman are awaiting trial.

The firms that seem to control the production and distribution of 8mm films in the Los Angeles area are Cinema Classics with Noel Bloom (mentioned earlier as being involved with Michael Zaffarano), and Lyndon Inc. with Theodore Gaswirth.

Of particular note in San Francisco pornography is the operation of Artie Jay Mitchell and James Lloyd Mitchell called Mitchell Brothers Film Group, Inc. The Mitchells had always claimed to be free of any organized crime connections, however, in 1974 they were visited by organized crime associates James Bochis and Robert DeSalvo who requested exclusive distribution rights to several of their movies. The brothers were told that unless they agreed, DeSalvo and Bochis would distribute pirated copies of one of the films all over the country, costing the Mitchells thousands of dollars in revenue. The Mitchells did not agree to this proposal and purchased the pirated copy of the fil, in question from Bochis and DeSalvo. The Mitchells lost thousands on their subsequent production of "Sodom and Gomorrah", which was very expensive to make and turned out to be a failure. Because of this loss of money, the Mitchell brothers entered into contract with Michael Zaffarano in regard to the distribution of their latest film "Autobiography of a Flea".

New York

The company which distributes most pornographic books, films, magazines, and sexual paraphernalia nationally is Star Distributing Company which is located in Manhattan and is allegedly owned by Samuel DeCavalcante, Boss of the LCN DeCavalcante. Robert DiBernardo, mentioned earlier as DeCavalcante's West Coast representative, is the main stockholder of the company, having taken over the operation when its president, Theodore Rothstein, was convicted for obscenity. He became the main financier and-Vice President. Star Distributors is now considered a multimillion dollar conglomerate that controls bookstores, movie theaters, and publishing houses spreading into New Jersey, Pennsylvania, Maryland, Ohio, and Georgia. A celebrated client of Star Distributors is Leisure Time, Inc. of Cleveland, believed to be tied to Cleveland Pornographer Reuben Sturman.

LCN Gambino member Ettore DeCurtis is a behind the scenes financier of pornographic literature, films, and homosexual bars. His involvement began four years ago when he financed Edward Mishkin's Wholesale Book Corporation, at 415 East 21st Street, New York, New York, one of the nation's largest producers, manufacturers, and distributors of pornography. Authorities describe Mishkin as the pornography king in New York. He was arrested on January 5, 1977 with Ralph Borello for selling obscene films to adult bookstores. An individual working at a movie processing firm specializing in X-rated low budget films was hired by DeCurtis to pirate films when necessary. Film makers must pay DeCurtis off or their films are pirated and Wholesale Books distributes them.

Anthony Peraino and his brother Joseph, both members of the LCN Colombo, are involved in the production and distribution of hard-core films and are thought to be among the most successful of those involved. In 1975, they were convicted for conspiracy to distribute "Deep Throat." Also indicted was Gerard Damaino Productions. Director Gerard Damaino is currently doing business as Blue Berry Hill Co. and Strawberry Hill Co., 165 West 46th Street, New York, New York, and engaging in the import and export of pornographic films. Herbert Nitke went into partnership with Joseph Peraino shortly after the release of "Devil in Miss Jones" to distribute that film and "Deep Throat" together. Nitke is Presently under indictment in Memphis for his complicity in the film "Deep Throat."

Joseph Gentile, also a member of the Colombo family, finances the New York production of pornographic films using legitimate producers as fronts.

The late Joseph Brocchini, former member of the Luches, family, was a large-scale pornography seller. He controlled three pornography wholesale firms worth 1.5 million dollars a year and had leases on several of the most lucrative bookstores in Times Square. After his murder, his brother-in-law Alfred (Sonny) Scotti became his undisputed heir in these operations, Assisting him are his brother James, Ralph Borello, and Vincent Borello.

A Luchese family rival is Martin Hodas, LCN Colombo associate, who is known as the "Peep Show King" in New York City. He oversees 90% of the peep shows there. He was released in October 1976 after ten months incarceration for income tax evasion. His business was apparently not hurt by his incarceration. The machines used are owned and operated by East Coast Cinamatics, Inc., owned by Hodas. They are used in New York, Philadelphia, Baltimore, and Atlanta. His real estate firms Island Amusement Corporation or Coast Holding Corporation hold many of the leases on adult bookstores. Films shown in the machines are often produced, manufactured, or distributed by Hodas' firms Adult Films Inc. or Dynamite Films Inc. Hodas is forced to pay protection to organized crime in order to operate, but has resisted mob infiltration of his businesses.

Cosmo "Gus" Cangiano, LCN Colombo associate, is a well known high volume distributor of pornography, especially films. In 1972, he was convicted of Interstate Transportation of Obscene Matter in the Eastern District of New York and was later fined $10,000 and sentenced to three years incarceration. This was the last Federal conviction for a pornography violation in a New York Metropolitan area court.

Florida

Anthony Peraino, mentioned earlier as being involved in the production and distribution of pornography in New York, is also involved in the same type of activity in Florida, where he resided until recently. He and his son Louis, aka William Perry, control the Gamecock Theater in Broward County, the corporation for which is American Films, Inc., Ft. Lauderdale. Also involved in the theater are Robert DeSalvo, Robert Bernstein, and Thomas Arnone. Peraino reportedly left Florida recently for Italy, where he is hiding. His operation has allegedly been taken over by Anthony Arnone of Los Angeles, who owns an unknown number of pornographic theaters in Florida.

Within the past three years, Ettore Zappi, LCN Gambino member, and his associates Natale Richichi and Robert Dibernardo employed coercion to take over a substantial part of the very lucrative "peep show" machine business in South Florida. This matter has been presented to the Miami Strike Force for prosecution under the Hobbs Act. Richichi was operating S.D. Art, Inc. in Hollywood, Florida until April 1976, when he returned to New Jersey. S.D. Art is owned by Ettore Zappi Michael Wisotsky took Richichi's place as operator of th, business. He is a member of the Wisotsky family which is active in retail pornography sales in the three major counties of South Florida. The group is headed by Myron Wisotsky who is Michael'., uncle. Michael is his principle associate in pornography. Myron's brother, Martin, is also active in the retail adult bookstore business in Dade County. The Wisotsky group is currently under investigation by the Miami FBI office for violation of the RICO statute.

Leonard Joseph Campagno, aka Lenny Camp, is presently believed to be the only 8mm film producer in Miami. He was convicted for felony conspiracy to promote obscene matter or performance and is currently serving an 18 month prison sentence. He had formerly photographed and produced both 8mm and 16mm films and sold the negatives to out of Florida pornographers who copied and distributed the materials. It is, anticipated that Campagno will resume this type of activity when he is released from prison.

William Haimowitz (previously mentioned as the LCN Gambino's West Coast representative) and his brother Samuel are regarded in the Miami area as significant pornography operators. Bot' brothers are also alleged to be working in Los Angeles for James Fratianno (LCN Los Angeles underboss) and John Dragon.

Benjamin Sigelbaum is a former banking official who has been known to set up Swiss bank accounts for organized crime figures. He also acts as an international courier of monies for organized rime figures. It is believed that he is the financial backer of Bernard Rose's pornographic enterprises. Rose owns the controlling interest in three X-rated movie theaters in Dade County which are leased to firms that actually operate them. He owns approximately 600 theaters in the United States. Rose is alleged to front investments for Meyer Lansky in Esquire Theaters. Benjamin Sigelbaum is also an associate of Meyer Lansky.

Leroy Griffin, a former Meyer Lansky man, is alleged to be the adult movie king in Miami. He owns and operates several adult theaters the Roxy theater, Pussycat Theater, Paramount Theater, and the Gaiety Theater, all in Dade County. It was recently reported that he is now leasing the 79th Street Theater and the King-Rex Theater from Bernard Rose.

Illinois (Chicago)

There is little evidence to indicate large-scale. production of pornographic material in the area, however, several large distributorships have been identified. The largest is Capitol News Agency at 3400 N. Kedzie, Chicago. The other is allegedly Reuben Sturman of Cleveland and the manager is Neil Traynor, who recently replaced Alan Bloom in that position. Capitol controls approximately 80% of the distribution of pornographic magazines and films in Chicago. It has its own delivery service and provides service for stores the materials are sold to. Local authorities report that Capitol News will provide an' individual that wants to open a retail pornographic shop with whateverr financial backing that is needed.

L & W Distributors and A & A Distributors share the remaining 20% of the Chicago area distribution. L & W is owned and operated by Leo Weintraub, an associate of Chicago organized crime figures. His operation deals almost entirely in the sale of "remainders" which are older magazines sold at greatly reduced prices which therefore return a greater margin of profit, Weintraub also owns several adult retail bookstores, in Chicago, all using the name L & W Adult Books.

A & A Distributors is owned and operated by Anthony DeFalco. He primarily deals in new pornographic films and magazines, but also handles remainders. It is believed that he originated the practice of leasing movie machines used in the showing of "peep shows" in retail adult bookstores. There are nearly 800 peep shows operating in Chicago's adult bookstores most of which are leased from A & A Distributors or Capitol News. A & A operates seven adult bookstores throughout the Chicago area and DeFalco is known to have operated pornography stores as far away as Des Moines, Iowa. The Chicago Police feel that his operation has the greatest potential for growth.

A pornographic movie distributorship which has just been started is Chicago Booking Service. It is believed significant because the owner, Patsy Ricciardi, has close ties to the Chicago "Outfit." He was the cousin of the deceased Felix Alderisio, member of Chicago organized crime. He is also associated with Frank Schweihs, suspected hit man and associate of Anthony Spiilotro who handles the Chicago Outfit's interest in Las Vegas and is the leader of the younger members of the Outfit.

Chicago organized crime member Marshall Caifano allegedly has a vested interest in some pornographic bookstores in Chicago. He is believed to be the owner of a pornographic book store, peeping Tom Bookstore, on the near north side of Chicago. This store is fronted for him. Caifano is also alleged to get $500 a week from the Over 21 Bookstore in Chicago which is owned by Reuben Sturman of Cleveland. Owners of the bookstores willingly give protection money to Caifano as a cost of doing business. Caifano is attempting to muscle and organize Chicago area porno graphic theaters, bookstores, and wholesale distributors of porno graphic books and peep show machines. He apparently was assigned the task of obtaining Leo Weintraub's operation, L & W Distributors. He now has approximately 25% of that operation. An attempt was made to muscle the Capitol News Agency, but apparently an agreement was reached between the Chicago Outfit and Sturman's group. Instead of actually taking over the bookstores and distributorships, Caifano instituted the collection of a street tax, which is collected by Mike Glitta and Anthony Juliano. Glitta and Juliano operate adult bookstores themselves. Glitta is the street boss for organized crime figure Joe DiVarco.

Massachusetts/Rhode Island

In the Boston area, pornographic material is distributed and/or wholesaled by the Imperial Distributing Company in Providence, Rhode Island and by the New England News Company of South Boston, Massachusetts.

The Imperial Distributing Company is headed by Kenneth Guarino, who is reputed to have a direct communication with LCPN New England boss Raymond L.S. Patriarca. Imperial Distributing Company is a major East Coast distributor with retail outlets in Rhode Island, Worcester, Massachusetts; Springfield,.Massachusetts; and Boston. As a result of a search at Imperial, indications were found that Guarino made cash payments to a "Mr. Z". It is suspected that "Mr. Z" is Ettore Zappi, LCN Gambino member. Guarino allegedly receives protection from Zappi and has purchased pornography from him in New York.

The New England News Company is. reportedly controlled by Sovereign News Company of Cleveland, operated by Reuben Sturman. Sturman is involved in New England News with Joseph Paladino. Paladino has financial interests in many of the pornographic cinemas in Boston.

Major pornography figure Michael Zaffarano is said to have connections with the pornography business in Boston. His brother-in-law, Anthony Carl Mascolo, received financial backing from Zaffarano in January 1976 in order to open two pornographic theaters in Boston. They are known as the Pussycat Cinema I and the pussycat West End Cinema. During a raid at the West End Cinema in January 1977, detectives found secret records in a hidden compartment reflecting that part of the gross receipts were being skimmed. As a result of raids, Mascolo has been arrested twice and charged with violations of state obscenity statutes. He was released recently after serving five days of a one year term. The release resulted from an appeal for his original obscenity conviction. Joseph Paladino allegedly receives a part of the gross of both Pussycat Cinemas.

Information was received indicating that Hallmark Releasing corporation, 46 Church Street, Boston and Judd Parker Films, Inc., same address, are organized crime controlled, although the individuals involved are not known. Both are owned by Phillip Scuderi. He and his associates Stephen G. Minasian and Bobby Goldfarb were involved in smuggling master prints of pornographic films from Europe. Investigation revealed that Hallmark and Judd Parker import between six and ten films per year into Boston.

Pennsylvania/New Jersey

In the city of Philadelphia and in the South New Jersey area, Radiant Merchandising, Inc. of Philadelphia controls the majority of the pornographic enterprises. It is the principal busi-ness operation of Bruno Gortese and Anthony Trombetta. The company has been identified as being associated with the LCN Gambino. Its pornographic material is imported from Los Angeles and New York City producers.

John Krasner, operator of PHK Corporation in Allentown Pennsylvania, controls the majority of the pornographic business in the Middle District of Pennsylvania (MDPA), southern New York State and New Jersey. He is associated with Russell Bufalino boss of the upper Pennsylvania area. There is also unsubstantiated informant information to the effect that Krasner is an associate of Joseph Falcone, LCN Buffalo in Utica, who attended) the Appalachian meeting. Krasner owns pornography shops in various New Jersey counties and in Virginia and Colorado. He purchases many of the supplies for these retail outlets from Crown News of Camden, New Jersey, which is a large supplier of pornography, particularly in the South Jersey area. Crown News, owned by Reuben Sturman, is allegedly influenced by the LCN Bruno. It obtains most of its supplies from Sovereign News Company in Cleveland and Crown Industries and Supply Company of Detroit (its parent company). Krasner's general mode of operation is to open a bookstore and utilize a corporation with a fictitious name for the operation of that particular bookstore. His center of operation is Disco Leasing, Incorporated, North 8th Street, Allentown, Pennsylvania, which is a five-story warehouse used by Krasner as the major distribution point for fulfilling orders for his various adult bookstores. Krasner is presently awaiting trial in Arlington County, Virginia for possession of obscene items with intent to distribute in connection with his bookstore there.

Allen Charles Morrow, operating Classic Distributors, has been involved in a running feud with John Krasner for five years about business locations. He also operates in the Middle District of Pennsylvania, Southern New York State and New Jersey.

In the Pittsburgh area, the primary distributor of pornographic materials is Majestic News Company, a subsidiary of Sovereign News Company of Cleveland. Majestic News is controlled by Gregory Harry Kocan. It owns and operates ten retail distributors in Western Pennsylvania, West Virginia, and Eastern Ohio and also a commercial pornographic theater in downtown Pittsburgh. It also supplies numerous other independent distri butors in Western Pennsylvania, West Virginia and Eastern Ohio. Films that Majestic News receives are ordered through Sovereign News.

Michigan

It is believed that Harry V. Mohney of Durand, Michigan, is one of the largest dealers in pornography in the United States. Most of the pornography he deals in is of foreign origin. He is alleged to have a close association with the LCN Colombo and the LCN DeCavalcante, both of which are very influential in pornography in the eastern United States. In Michigan, Mohney is known to hire individuals with organized crime associations to manage his businesses. His businesses and corporations consist of 60 known adult bookstores, massage parlors, art theaters, adult drive-in movies, go-go type lounges and pornographic ware houses in Michigan, Indiana, Illinois, Kentucky, Tennessee, Wisconsin, Iowa, Ohio, and California. He is involved in the financing and production of pornographic movies, magazines, books, and newspapers. He also directs the importation and distribution of his own and other pornographic publications to retail and wholesale outlets throughout the United States and Canada. Mohney purchases all publications that are available from Parliament News in Van Nuys, California and many other firms in California. He has a working relationship with DeCavalcante's representative Robert DiBernardo and has met with Vito Giacalone and Joseph Zerilli of the LCN Detroit. He has to cater to both to operate in Michigan. Mohney is presently under indictment and is to go to trial October 31, 1977.

During a search of B & W Distributors, 17311 West 7 Mile Road, Detroit, 544 reels of pornographic film were seized. Silent partners in the business were William Berkowitz and Samuel Norber, both known organized crime figures in the Detroit area.

Nicholas Frangoulis was arrested on July 26, 1975 by London, Ontario police for possession with intent to distribute 191 reels of pornographic film which he had taken out of the United States and smuggled into Canada. He is an associate of Detroit orga nized crime figures Louis Ruggirello and Mike Thomas. Frangoulis stated that he was a pornography salesman in Detroit employed by Variety Distributors, Inc., believed to be Variety Books of Durand, Michigan owned and operated by Harry Mohney.

The major wholesaler of pornographic material in the Detroit area is Royal News in Romulus, Michigan, which is a subsidiary of Sovereign News of Cleveland. Royal News is run by Richard Little and Samuel Zerilli, who answer directly to Reuben Sturman.

Another large-scale wholesaler is Samuel Ellman who owns or has an interest in Crown Industries and Supply (mentioned earlier as the parent company of Crown News, Camden, New Jersey), Slam Products, and Tiara Industries, all in Detroit. Ellman's partner is Milton Moskovitz, known to be a long time pornographic dealer. Crown Industries and Slam Products are wholesale operations, while the Tiara Company manufactures rubber goods that are then sold to Crown and Slam companies.

Maryland (Baltimore)

In the Baltimore area, there are three major companies involved in distribution of pornography. They are Bon-Jay Sales, 6601 Moravia Park Drive, Baltimore; Komar, Limited, 1123 East Baltimore Street, Baltimore; and Noble News Company, 7803 Pulaski Highway, Baltimore.

Bonjay Sales and Komar Limited are owned and operated by Jack Gresser and Samuel Boltansky, whose two principal aides are John Louis Moon and Ronald Lawrence Selinger. The companies are warehouses used for storing pornographic material which is sold on the retail level throughout the United States and Canada. Gresser and Boltansky distribute about $3,000,000 each year in pornographic material. Most of the material they sell is supplied by Star Distributors in New York, Parliament News in California and Sovereign News in Cleveland. Gresser and Boltansky are also allegedly responsible for smuggling original negatives and photo offset printing plates containing pornographic material made in Europe. These items are allegedly smuggled into the United States by mail and then given to the above-mentioned suppliers for printing the material.

Noble News Company is a subsidiary of Sovereign News Company in Cleveland. The Baltimore outlet is run by John Henry Marshall, an agency manager.

Ohio (Cleveland)

The major pornographer in the Cleveland area is Reuben Sturman, owner of the Sovereign News Company there. He is considered to be-the largest distributor in the nation. He, six of his employees and the corporation were indicted in March 1976 in 29 counts for violation of Title 18, U.S. Code, Sections 1461, 1462, and 1465 (interstate transportation and distribution of obscene magazines and films). Despite the indictment, Sturman continues to trans port pornography throughout the United States and the world.

Sovereign News Company operates under a large number of corporate names. It obtains various printed material by ordering it from a supplier or having it printed. The ordering is done in the name of Sovereign News or one of its wholly-owned corporations. It has nationwide operations which appear to be closely allied with organized crime figures in certain areas.

The pornographic material is then sold to one of several distributors throughout the United States, which are usually wholly owned subsidiaries of Sovereign News. The material is then sold to the distributors to various retail outlets, usually wholly-owned by the distributors.

Sovereign News is reportedly deeply into the "peep show" machine business. It furnishes the machines and films on a percentage basis to various locations. Sturman has attempted in particular to take over control of the peep show outlets in the Los Angeles and San Diego areas. During a search of Sovereign News Company in March 1975, it was determined that the company controls distribution of pornographic magazines and 8mm films in Buffalo; Camden, New Jersey; Pittsburgh; Denver, and other major cities. It was also determined that Sturman received much of his material from Star Distributors in New York. A partial list of companies believed to be subsidiaries. of Sovereign News follows:

Sun Dial Distributing Co.
2650 West Second Avenue
Denver,Colorado
Manager: Joseph Coulter
Director & president: Theodore A. Pintepiece

Noble News Company
7803 Pulaski Highway
Baltimore, Maryland
Manager, Herman Weiss
Directors: Melvin Famins
Samuel Joseph
Maurice Escott

Crown News
1171 Chestnut Street
Camden, New Jersey
Corporate officer: Morton A. Goss

Capitol News Company
3400 North Kedzie Avenue
Chicago, Illinois
Corporate Officers: Stanley D. Seidler
Evelyn Seidler
Dick Brown
William J. Bowe
Jarard Carlin

New England News Company
215 A. Street
Boston, Massachusetts
Corporate officers: Neil Traynor
Gary Rosenthal

Royal News Company
30024 Beverly Road
Romulus, Michigan
Manager, Richard Little
Statutory Agent: Reuben Sturman

Castle News Company
4551 North 125th Street
Butler, Wisconsin
Manager: Paul Bubrick

Imperial News Company
35 Main Street
Depew, New York
Manager: Frank Potwora Majestic News Company
922 West Fourth Avenue
Pittsburgh, Pennsylvania
Manager: Greg Kocan

Discount News Company
1975 East 65th Street
Cleveland, Ohio
Manager: Bernie Wyman

Candor in Love Institute
Post Office Box 6116
Cleveland, Ohio
Possible Owner: Reuben Sturman

Most of the companies listed have been discussed in detail in previous sections of the report under the state in which they are located. In each instance, the company has been one of the major dealers in pornography in that state. This is a further indication of Sturman's importance in the pornography field.

Sundial Distributing Company in Denver is recognized on the local and Federal level as being the principal distributor and Wholesaler, in the Denver area. It was the subject of an extensive investigation for several years, especially during 1976. The company was traced to Pacific Book Shop, Inc., in ;ailmington, Delaware, which had filed application as a foreign corporation to do business in Colorado under Sundial Distritutors, Inc. It was determined that Sundial Distributing Company is a wholly owned corporate subsidiary of Sovereign News Company.

The primary distributor of hard-core pornographic material in Wisconsin is Castle News Company, Inc., Butler, Wisconsin. Castle News directly controls at least 13 retail outlets in Wisconsin and Illinois and also distributes to dozens of other retail out lets in Wisconsin, Illinois, and Iowa. Minnesota is looked upon as a new market for Castle News, and some materials are said to be already arriving there from the Wisconsin Company. Reuben Sturman is the sole owner of Castle News. Paula Bubrick, the agency manager, is assisted by Anthony J. Bucciarecci and Joseph A. Bertucci, who are officers of the company. Pornographic materials are received directly from publishing• firms on the West Coast or from the Sovereign News warehouse in Cleveland.

Two men identified as being associated with Sovereign News, Ralph Leon Levine and Jack Lee Marcum, are principals in operating the Talk of the Town Bookstore and the Peekarama Movie Arcade businesses in Las Vegas. Both men are from Cleveland. There are five adult oriented businesses in Las Vegas and two in Reno that are directly controlled by Levine. All are considered to be associated with Sovereign News. Also in Las Vegas, Jack Tuppler moved in with hard-core pornography forming his owr retail businesses to market his goods. He gets all of th, financing for setting up these businesses from Sturman.

Between August 1976 and January 1977, five adult bookstore in Des Moines, Iowa, were purchased by a Delaware based corporation named Castle News, Inc. It was determined through local authorities in Cleveland and Cincinnati that these stores were purchased for Sturman by Alan I. Goelman, Management Service Company, Cleveland. He is supposedly the pornographic contact for Sturman.

It has been reported that one of the major sources of pornographic material for the Dallas area is Sovereign News Company. Also information has been received that Samuel Joseph, representing Sturman, has been contacting bookstores in Houston, trying to sell hard-core pornography. William A. Gaulson, owner of the Starbase Publishing Company in Houston, is said to get most of his films from California and Cleveland.

Sturman is also allegedly involved in distribution of illegally imported-hard-core films. The film "Sensations", imported through Texas, was produced in Europe by Alberto Ferro aka Lasse Braun, a known associate of Sturman. This film was distributed nationally by Sturman.

Sturman is allegedly responsible for the publication "Lolly Tots", a pornographic magazine featuring children. He is also allegedly involved in producing stag films featuring children that are distributed by Parliament News in California, one of the largest distributors of this type of pornographic material.

Georgia (Atlanta)

Michael George Thevis is one of the largest dealers in pornography in the nation. Based in Atlanta, Thevis built a major pornography organization involving the wholesale and retail distribution of pornography. He opened numerous adult movie theaters and bookstores throughout the Southeast, becoming the largest and most successful pornography distributor in that part of the United States. His operations are allegedly controlled by Star Distributing Company in New York (owner Sam DeCavalcante, Vice President Robert DiBernardo, LCN DeCavalcante).

Thevis and his corporation, Book Bin, inc., were convicted in 1971 for mailing obscene material. He began serving a three year sentence in 1975 and is eligible for parole on July 21, 1977.

While Thevis is incarcerated, his empire, which at one time consisted of over one hundred businesses, companies, and corporations, is being run by his long-time associate and confidant, Laverne Bowden. The larger corporations making up his empire are Peachtree News Company, Inc., Peachtree National Distributors, Inc.; Pendulum Books; Animatics; Global Leasing, Inc., and Fidelity Equipment Leasing Company, Inc. Melvin Friedman is presently acting as President of Peachtree News Company and other affiliated companies in Thevis' absence, but Thevis remains the real power. The Atlanta FBI office is conducting a major RICO investigation concerning Thevis, which is near the indictment stage.

Companies controlled by Thevis manufacture and distribute all phases of adult literature and films. The corporations ship merchandise to each of the 50 states as well as to between 12 and 15 foreign countries. A few of Thevis' operations in other states are as follows:

Florida Periodicals, Tampa
Large-scale distributor/wholesaler

Rivergate News Agency, New Orleans
Only distributor operating in Louisiana

Satellite News Agency, Houston
Large-scale wholesaler, local distributor

Carolina Book Distributors, Raleigh
Thevis subsidiary, distributor hard-core
Awaiting grand jury action in Raleigh

Tulsa Book Mart, Inc., Tulsa
Local distributor for Peachtree News, Inc.
Operator - Don Gasaway

This report is submitted for information purposes at this time. A review of the available information is being made for the purpose of recommending a course of action. This recommendation will include suggestions made by the attendees at the next NOCPC Pornography Subcommittee meeting.

Notes

  1. For a more complete explanation of traditional organized crime structures and influence see the textual discussion of organized crime, supra.
  2. New York Hearing, Vol. I, Homer Young, p. 40.
  3. Id., p. 41.
  4. New York Hearing, Vol. I, Aladena   interview, Interview by Senior Investigator Edward H. Chapman, Attorney General's Commission on Pornography, p. 112.
  5. Id., pp. 112-15.
  6. New York Hearing, Vol. I, "Bookstore Operator" interview, pp. 141-44; See also, New York Hearing, Vol. II, William Johnson, p. 82A-1 on "16 November 1970, Kenneth Herbert (Jap) Hann's bullet riddled body was found in the trunk of a car at Atlanta International Airport."
  7. The Report of the Commission on Obscenity and Pornography, (1970), pp. 141-43.
  8. New York Hearing, Vol. I, Homer Young, p. 10; Former Federal Bureau of Investigation Obscenity Specialist Young reported that a staff member of the 1970 Commission interviewed him for approximately four hours about the role of organized crime in pornography in the 1968/1969 era. Young advised that he furnished the individual with documentation of organized crime involvement which for some unknown reason was not included in the earlier Commission's final report.
  9. New York Hearing, Vol. I, William Kelly, p. 69.
  10. See, Appendix One, infra.
  11. New York Hearing, Vol. I, James D. Harmon, p. 14A-5.
  12. "The building in which Star (Distributors, Inc) rent space is managed and partly owned by John Zaccario ... a fact first revealed in a New York City Tribune Copy story ..." Selle, Pornography Warehouse Target of Irate Protestors, N.Y. City Trib., Oct 29, 1984
  13. Organized Crime's Involvement in the Pornography Industry, Investigative Services Division, Metropolitan Police Dept., Washington, D.C. (1978).
  14. New York Hearing, Vol. I, Carl Shoffler, p. 214.
  15. Id., p. 215.
  16. Id.
  17. See, Washington, D.C., Hearing, Vol II, William H. Webster, pp. 77-81. 1143. Id. at 75; New York Hearing, Vol I, Homer E. Young, p. 16.
  18. Washington, D.C., Hearing, Vol. II, William H. Webster, p. 81.
  19. Federal Bureau of Investigation Report Regarding the Extent of Organized Crime Development in Pornography, (1978), p. 6.
  20. Letter, William H. Webster, Director, Federal Bureau of Investigation to Henry E. Hudson, chairman, Attorney General's Commission on Pornography, Nov. 15, 1985.
  21. Letter to the Attorney General's Commission on Pornography from the Federal Bureau of Investigation, March 24, 1986.
  22. Id.
  23. Id.
  24. New York Hearing, Vol. I, William P. Kelly, p. 86.
  25. New York Hearing, Vol. I, Thomas Bohling, p. 178.
  26. Id., p. 189.
  27. See, Los Angeles Hearing, Vol. I, James Docherty, p. 6.
  28. Los Angeles Hearing, Vol. I, Robert Peters, p. 32. Detective Peters estimates that eighty to ninety percent of the pornography in the United States is produced in the Los Angeles area. See also, The discussion of production and distribution of sexually explicit materials.
  29. Los Angeles Hearing, Vol. I, Robert Peters, p. 32.
  30. Investigative Report on Organized Crime and Pornography Submitted to the Attorney General of California, 2-3.
  31. State of California, Department of Justice, Organized Crime in California, (1984), p. 6.
  32.  
  33. Id., p. 5.
  34. Investigative Report on Organized Crime and Pornography Submitted to the Attorney General of California 5.
  35. New York Hearing, Vol. II, William Johnson, p. 82A; See, the discussion of the production and distribution of sexually explicit materials for a detailed explanation of the profitability of the industry.
  36. See, Los Angeles Hearing, Vol. I, James Docherty, p. 6.
  37. New York Hearing, Vol. II, William Johnson, p. 73.
  38. Id., p. 82A-5.
  39. Id.
  40. New York Hearing, Vol. I, William Kelly, p. 108A-3.
  41. Id.
  42. Id., p. 108A-4.
  43. Cong. Rec., S433 (daily ed. Jan. 30, 1984). (statement of Senator Jesse Helms).
  44. Id.
  45. New York Hearing, Vol. II, Christopher J. Mega, p. 160.
  46. New York Hearing, Vol. I, Interview with James  Fratianni  by Senior Investigator Edward Chapman, Attorney General's Commission on Pornography, p. 112.
  47. New York Hearing, Vol. I, Interview with Jimmy Fratianni, by Senior Investigator Edward H. Chapman, Attorney General's Commission on Pornography, pp. 115-16.
  48. See, Investigative, Report on Organized Crime and Pornography Submitted to the Attorney General of California; State of California, Department of Justice, Organized Crime in California (1984).
  49. See, The discussion of the production and distribution of sexually explicit materials for further information.
  50. See, The sections discussing social and behavioral science research, harms and victimization for a more complete explanation.
  51. New York Hearing, Vol. I, William Kelly, p. 76.
  52. See, United States v. Thevis, 665 F.2d, (5th Cir. 1982), p. 616.
  53. New York Hearing, Vol. I, William Kelly, p. 75.
  54. Id.; Cong. Rec. S433 (daily ed. Jan. 30, 1984) (Statement of Sen. Jesse Helms).
  55. New York Hearing, Vol. I, Thomas Bohling, pp. 180-87; New York Hearing, William Johnson, Vol. II.
  56. New York Hearing, Vol. I, Christopher J. Mega, p. 162.; Cong. Rec. S433 (daily ed. Jan. 30, 1984) (statement of Sen. Jesse Helms).
  57. New York Hearing, Vol. II, Thomas Bohling, pp. 182-83.
  58. See, Chapter 2 in this Part for a more complete discussion about performers.
  59. Los Angeles Hearing, Caryl and Brian Cid, pp. 127-53; New York Hearing, Vol. I, Linda Marchiano, p. 51; Washington, D.C., Hearing, Vol. I, Valerie Heller, pp. 217-41; Washington, D.C., Hearing, Vol. II, Charles Sullivan, pp. 65-77; See also, The discussion of performers and harms attributable to their work.
  60. New York Hearing, Vol. I, Bookstore Operator, p. 152.
  61. Id., p. 141.
  62. New York Hearing, Vol. I, Thomas Bohling, p. 179.
  63. New York Hearing, Vol. I, William P Kelly, p. 83.
  64. New York Hearing, Vol. I, Bookstore Operator, p. 131; The FBI reported such a territorial dispute in 1981 involving pornography stores in New England. The dispute arose between Joseph Palladino, an operative of New England LCN Boss Gennaro  Anginlo, and Carlo Mastrototaro, who had been authorized by the New York LCN family to open a competing business in Worcester, Massachusetts. Letter to Attorney General's Commission on Pornography from Federal Bureau of Investigation, March 24, 1986.
  65. New York Hearing, Vol. I, Bookstore Operator, p. 131.
  66. Id.
  67. New York Hearing, Vol. IV, W.H.I.S.PE.R. Statement, p. 398.
  68. Id.
  69. Id.
  70. Washington, D.C., Hearing, Vol. I, Sarah Wynter, pp. 175-84.
  71. See, Chapter 16 of this Part for a discussion of performers.
  72. New York Hearing, Vol. I, Thomas Bohling, p. 185.
  73. An investigator reported to the Commission that child pornographers use cocaine to lure children, create an addiction and thus a lasting relationship of molestation and pornography production. Miami Hearing, Vol. II, Dennis Shaw, p. 107. Los Angeles Hearing, Vol. I, Chris, pp. 94-95; "I had been taking drugs throughout the time I was in prostitution and pornography. They had been supplied and doled out to me by my pimp." Washington, D.C., Hearing, Vol. I, Sarah  Wynter, p. 185.
  74. New York Hearing, Vol. I, Christopher J. Mega, p. 167.
  75. Id.
  76. Los Angeles Hearing, Vol. I, James Docherty, p. 8.
  77. Skimming is the practice of fraudulently reporting income so as to avoid tax liability.
  78. New York Hearing, Vol. I, Bookstore Operator, pp. 146-51.
  79. See, The discussion of production and distribution of sexually explicit materials for a further explanation.
  80. New York Hearing, Vol. I, Bookstore Operator, pp. 146-51; New York Hearing, Vol. II, William Johnson, pp. 7374.
  81. New York Hearing, Vol. II, William Johnson, pp. 73-74.
  82. Id.
  83. Id.
  84. Id., p. 73. See also, The discussion of the production and distribution of sexually explicit materials for more detailed description of bookstores.
  85. New York Hearing, Vol. I, Bookstore Operator, pp. 124-25.
  86. New York Hearing, Vol. I, Christopher J. Mega, p. 167.
  87. Several law enforcement agencies for years have identified Mr. Di Bernardo as an associate of the de Cavalcante family of New Jersey. However, during the trial of Di Bernardo and Rothstein in the Miporn case in June of 1981, a New
  88. "Now, is it possible to be involved with both families?" "I don't know, but that's what the information is, that he is involved with both. It could be right and it might not be right. I don't know." New York Hearing, Vol. I, William P. Kelly, pp. 77-78.

  89. New York Hearing, Vol. I, Homer Young, p. 34.
  90. New York Hearing, Vol. I, Thomas Bohling, p. 182.
  91. New York Hearing, Vol. II, Marcella Cohen, p. 32; United States v. Wisotsky, 83-741-Cr EBD (S.D.Fla.).
  92. New York Hearing, Vol. I, Bookstore Operator, pp. 144-45.
  93. "Arno said he had been previously somewhat reluctant to inform the agents that he was involved in the reproduction of pirated motion pictures as this was a violation of federal copyright statutes. Arno said that there were several problems connected with the production of these video tape cassettes, because there was a lot of pressure from the FBI recently in this area and that several producers of pirated films had been busted in the recent past and were now working for the FBI." New York Hearing, Vol. II, Marcella Cohen, pp. 17, 38.
  94. See, The discussion in the Recommendations for Law Enforcement Agencies. "To effectively conceal the full extent of its involvement in the nation's pornography industry, organized crime has developed a maze of organization structures through complex legal maneuvering. Pornography businesses are often represented on corporate papers by persons with no apparent ties to the company's true owner. Business transactions are commonly conducted with hidden corporate affiliates which creates an appearance of legitimate competitive business practices. Foreign corporations and banks have been used to circumvent normal business accounting methods.
  95. For protection purposes, pornographers frequently form several corporations for one operation. They know that law enforcement authorities, when serving search warrants as a result of possible obscenity violation, are restricted to search only the corporation named. The other corporations remain protected from police inspections." Investigative Report on Organized Crime and Pornography Submitted to the Attorney General of California, 5, 6(1978).

  96. New York Hearing, Vol. II, Marcella Cohen, p. 38.
  97. Id.
  98. Pornographer Michael Joseph Glita, member of Accardo family was reported to the United States Senate Rackets Committee as the number two man in a North Side Chicago numbers racket. New York Hearing, Vol. I, Thomas Bohling, p. 182.
  99. New York Hearing, Vol. I, Marilyn Sommers, p. 199; E. Whalen, Prince of Porn, Cleveland Magazine, (Aug. 1985), p. 143.
  100. New York Hearing, Vol. I, Marilyn Sommers, p. 200.
  101. New York Hearing, Vol. I, Interview with Jimmy  Fratianno, Edward Chapman, p. 115.
  102. Id.
  103. E. Whalen, Prince of Porn, Cleveland Magazine, (Aug. 1985), p. 82
  104. Id.
  105. The Porn Peddlers, San Diego Reader, Vol. 15, No. 10, Mar. 13, 1986, p. 17.
  106. Id.
  107. Id.
  108. Id.
  109. Id.
  110. See, e.g., United States v. Sovereign News Co., et. al, United States District Court, Western District of Kentucky.
  111. In 1980 Sturman  was charged in the MIPORN investigation. The charges were ultimately dismissed.  Sturman was also charged with a prior obscenity violation in Cleveland in 1976. He was acquitted.
  112. New York Testimony, Vol. I, Marilyn B. Sommers, pp. 1-15.
  113. Id.
  114. E. Whalen, Prince of Porn, Cleveland, (Aug. 1985), p. 82.
  115. New York Hearing, Vol. I, Marilyn Sommers, p. 209.
  116. The "White Paper" fails to disclose that some of the video cassettes sold by GVA have been found to be obscene by state and federal courts and that individuals and corporations have been convicted of felonies for their distribution. See, New York Hearing, Vol. II, William Johnson, p. 79.
  117. New York Hearing, Vol. I, Carl Shoffler, pp. 217-18.
  118. New York Hearing, Vol. II, William Johnson, p. 82A-10.
  119. Federal Bureau of Investigation Report Regarding the Extent of Organized Crime Involvement in Pornography. (1978).
  120. On January 21, 1982, it was disclosed that Agent Livingston had been arrested for shoplifting in a department store outside Louisville, Kentucky. After being notified of Livingston's arrest, two MIPORN defendants, Robert DiBernardo and Theodore Rothstein, filed motions asking the United States District Court in Miami to vacate their convictions and dismiss the indictments against them. They alleged the Grand Jury had received tainted evidence in the form of testimony from Livingston, whose credibility was now seriously in doubt. The District Court conducted a full hearing on the matter and heard testimony form psychiatrists who believed Livingston had a propensity to lie. Several of Livingston's FBI colleagues also testified regarding their doubts about his mental and emotional well being. DiBernardo and Rothstein also alleged that the prosecution had presented additional prejudicial evidence before the Grand Jury, including information about the defendant's alleged connections with organized crime and related criminal offenses. The District Court ruled that the Grand Jury had received tainted evidence from Agent Livingston who, it concluded, did have a propensity to lie. Based on that tainted evidence and the other matters presented to the Grand Jury which the court found to have been prejudicial, the Court vacated the convictions and dismissed the indictments. This decision is reported in United States v. DiBernardo, 552 F.Supp. 1315(S.D.Fla. 1982). The United States Court of Appeals for the Eleventh Circuit subsequently reversed the District Court's ruling in United States v. DiBernardo, 775 F.2d 470(11th Cir. 1985). The Appeals Court ruled that neither the questions regarding Agent Livingston's credibility nor the alleged prejudicial evidence presented to the Grand Jury were sufficient grounds for the District Court to invoke the drastic measure of dismissing the indictments. The Appeals Court held that deliberate abuse of the Grand Jury process, such as perjury or governmental misconduct, must be present to justify the District Court's dismissal of an indictment. Neither was established in this case. The Court further reasoned that permitting the District Court to dismiss indictments based on allegations of this nature would invite similar challenges by defendants to every indictment.

    The shoplifting charge against Agent Livingston was ultimate dismissed by the local prosecutor in Kentucky after Livingston signed a release agreeing not to file suit based on false arrest.

    To the extent that any of Ms. Cohen's statement was based on evidence provided by Agent Livingston, it has been fully corroborated by other evidence including tape recordings, third party statements, surveillance and court records. Most of the convictions discussed in this portion of the report occurred after the 1982 District Court ruling dismissing the indictments in United States v. DiBernardo.

  121. See, New York Hearing, Vol. I, Christopher J. Mega, p. 161.
  122. United States v. Wisotsky, et al. 83-741-cr EBD (S.D.Fla.).