Salvatore Pisello: A Shadowy Figure in Records Deals

Since moving to Los Angeles from New York in the early 1970s, Salvatore Pisello has lived the good life. As a restaurateur, food importer-exporter, record business wheeler-dealer and international jet-setter, he stayed at the best hotels, ate at the best restaurants, shopped at the swankiest Beverly Hills stores, wore the most expensive clothes and jewelry, drove the fanciest cars, dated the flashiest young women and always carried a big wad of cash.

Pisello’s friends and business associates knew him as a charming extrovert, a gourmet Italian cook who liked to host dinner parties at his Lake Encino home and who always seemed to have another moneymaking plan in the offing.

But law enforcement officials were aware of another side to Pisello. They knew him as a suspected East Coast Mafia figure whose activities for the last 20 years had been under near-constant investigation by the FBI, the Internal Revenue Service, the Drug Enforcement Agency and authorities in New York and Los Angeles.

Police in Rome and Milan have monitored his movements and phone calls during his visits to their cities.

According to intelligence files of these law enforcement agencies that have recently been made public, Pisello--also known as Sal the Baker, Sal the Swindler and Big Sal--has long been suspected of narcotics trafficking, although he has never been charged with any drug-related offense.

Now Pisello’s good life may be over, at least for awhile.

A federal judge in Los Angeles on Friday ordered him to surrender to authorities on May 23 to begin serving a two-year prison sentence for tax evasion. Prosecutors in the case had asked that Pisello be jailed immediately in the wake of a U.S. Court of Appeals ruling April 10 upholding his 1984 conviction. Pisello was sentenced last April, but has been free since May on $15,000 bail pending his appeal.

In papers filed April 18 in U.S. District Court here, the Los Angeles office of the Justice Department’s Organized Crime Strike Force stated that since Pisello’s sentencing, “new evidence has been secured” showing that he received about $700,000 in unreported income from record industry transactions in the last few years.

According to the strike force, “possible new charges, in addition to imminent incarceration,” increased the likelihood that Pisello might become a fugitive.

At a hearing in U.S. District Court on Friday, Marvin L. Rudnick, a special attorney for the Los Angeles office of the Justice Department’s Organized Crime Strike Force stated that an ongoing grand jury investigation had uncovered “substantial new evidence linking (Pisello) to criminal activity in the record industry.”

At the time of his sentencing last year, Pisello was described in court documents as an alleged international heroin trafficker and high-ranking soldier in the Carlo Gambino crime family of New York who, in 1983 and 1984, engaged in a series of record business deals with Los Angeles-based MCA Records.

In an animated interview outside the courtroom Friday, Pisello denied virtually all the government’s allegations against him, including the tax charges. “I’m not a member of organized crime and never have been--I’ll go to prison for 20 years if anyone can prove that,” he said. “I go to church every Sunday and the only organization I ever belonged to was the Holy Name Society (a Catholic lay society),” he said.

Referring to his deals with MCA Records, Pisello said, laughing. “I’m in the record business for one year and I’m supposed to have destroyed the industry?”

Those deals are now the focus of three federal grand jury investigations into organized crime infiltration of segments of the record business.

Based in Los Angeles, New York and Newark, N.J., the investigations are technically separate and differ somewhat in scope, but they are bound together by a common thread: Salvatore Pisello.

Investigators are trying to determine how Pisello--with no previous record business experience--wound up in high-level meetings with MCA officers, including President Irving Azoff, negotiating record deals that earned him a high six-figure income--an amount that would place him among the best-paid executives in the industry.

MCA, the giant Los Angeles-based entertainment firm and parent of Universal Studios, has stated that its record executives had no prior knowledge of Pisello’s background or alleged organized crime ties. The various parties to the deals can’t seem to agree on how Pisello got his foot in MCA’s door.

MCA said Pisello’s first contact with the company came in late 1983, when, as a representative of Englewood, N.J.-based Sugar Hill Records, he helped arrange a deal in which MCA would act as distributor of the tiny record label’s products.

Sugar Hill President Joe Robinson recently was quoted in a local newspaper, the Bergen County (N.J.) Record, as saying that Pisello brought the MCA distribution deal to him. Robinson has refused to talk to The Times.

Sugar Hill attorney Joe Zynczak said he initiated the discussions between the two companies and negotiated the final distribution agreement. “But I still don’t know how Pisello got involved to this day,” he said.

Pisello said Friday that he simply “walked into MCA and made an appointment with (MCA Records Executive Vice President) Myron Roth and said I represented Sugar Hill--I talked my way into it.”

Alarmed Officials

However it happened, Pisello’s sudden appearance in the record business in 1983 alarmed law enforcement officials. Although Pisello has been convicted only once--for tax evasion in 1984--law enforcement intelligence documents placed in the public record as a result of his conviction paint a picture of him as a career criminal with a history of close ties to mobsters.

According to the intelligence documents filed in U.S. District Court here, Pisello’s suspected involvement in a number of fraud and embezzlement schemes over the years earned him a reputation as a con artist.

The various alleged scams--involving restaurants and meat companies that he has controlled--also brought Pisello to the attention of the IRS, which discovered that he had filed only four personal income tax returns between 1965 and 1982 and had paid only $2,500 in federal taxes during that time, according to court records.

Intelligence compiled by the Italian National Police and cited by U.S. authorities in court papers here describe Pisello as an “international swindler” who, in 1970, defrauded a jeweler at the Hotel Di Paris in Monte Carlo of $102,000. The papers do not say how the alleged fraud was accomplished.

A 1980 confidential intelligence bulletin from the Los Angeles district attorney’s office, a copy of which was obtained by The Times, describes Pisello as a “major narcotics supplier of heroin from Mexico City.”

The bulletin states that Pisello “travels frequently to Europe and has been known to carry a weapon.”

Mafia Ties Alleged

The most extensive intelligence files on Pisello, however, belong to the DEA. A 39-page “Profile of Salvatore James Pisello,” prepared in 1978 and filed by prosecutors in federal court here last week, says that, while he has no arrest record for narcotics violations, his “closest associates are among the top drug violators in organized crime.”

The DEA profile states that on one trip to Rome in the mid-1970s, Pisello checked into an expensive hotel and made room reservations for two Sicilian Mafia chieftains suspected of heroin trafficking. He later picked up the hotel tab for another Sicilian Mafioso .

The DEA believed that Pisello was meeting with the mobsters to arrange the smuggling of a large quantity of heroin from Turkey through France and Italy to the United States.

In 1977 and 1978, Pisello and three other mobsters were investigated by a Los Angeles-based FBI-DEA task force that suspected that the group was “directing large-scale narcotics transactions involving Aniello Dellacroce,” then acting boss of the Gambino crime family, according to court records. It was determined that there was insufficient evidence to prosecute Pisello in that case.

Pisello’s suspected narcotics activities so concerned authorities that when he proposed a plan to a group of Maine state officials and farmers in 1972 to fatten and export 200,000 head of Maine cattle to Italy, it prompted a meeting by investigators from the New York State Police, the New England Organized Crime Intelligence, the U.S. Customs Service, the Bureau of Narcotics and Dangerous Drugs and the Securities and Exchange Commission, according to the DEA profile.

The investigators noted that Pisello had recently traveled to Italy, Switzerland, Mexico, South America and Japan, “probably in furtherance of a stolen security or drug transaction,” the profile alleges.

‘Ulterior Motives’

The investigators concluded that the cattle export plan was proposed by Pisello for “ulterior motives, which would be at the expense of Maine farmers and bankers.” The deal never went through.

Pisello’s exploits in Los Angeles include the alleged extortion of an ultra-exclusive Beverly Hills men’s clothing store, according to DEA intelligence documents.

A 1978 DEA report, now part of the court record, states that Pisello once employed 6-foot, 7-inch, 270-pound Benny Shells to collect “protection payments” from Bijan, a clothier on Rodeo Drive.

A spokesman for the store, which does business by appointment only, denied that the establishment had ever been extorted by Pisello. “Mr. Bijan (the store owner) is shocked” at the DEA allegations. “It’s the first he ever heard of it,” said the spokesman, who described Pisello as a longtime client who “always pays his bill.”

In another deal, Pisello formed a group of well-to-do doctors and businessmen to invest nearly $500,000 in a restaurant that he owned, Roma di Notte on La Cienega Boulevard, according to court papers in the tax evasion case.

Roma Di Notte was later destroyed in a fire, along with its financial records. Fire officials listed the blaze as suspected arson, and the case has never been solved.

Pisello became the subject of a tax evasion investigation in 1980 as a result of his alleged attempt to set up a drug-smuggling operation out of Fulton Fish Market in West Los Angeles.

According to court papers, the owner of the market, Marianno (Marty) Antoci, went to authorities and told them that Pisello was planning to use his firm as a front to import narcotics from Italy in airline-safe lobster tanks.

Attempt Failed

The agents then gave Antoci $15,000 to set up the deal with Pisello, according to the record. But Pisello never delivered the drugs or returned the cash, and the government referred the case to the IRS, according to court papers.

It was during the IRS investigation that Pisello’s dealings with MCA first came to light. Said one investigator: “When we saw Sal at MCA, we figured a crime was being committed, we just didn’t know what crime.”

MCA has denied that Pisello was ever an agent or employee of the company. However, according to a dozen current and former MCA executives interviewed by The Times, Pisello enjoyed an unusually close relationship with the record company during 1983 and 1984.

During that time, the executives claim, Pisello worked at the company nearly every day, using its offices, phones and secretaries to conduct business for a company in which he was involved called Consultants for World Records.

“He had the run of the place,” one former top executive said. “It was unprecedented in all my years at the company. The managers of recording artists used to want to do that, and we wouldn’t let them. They had to call and get an appointment, they couldn’t just come in and hang out.”

“Everyone in the office knew Sal,” one current MCA executive said. “And he stuck out so much, in terms of style and appearance. You know, the diamond rings and gold watch. . . . There was a standing joke around the office that you didn’t know whether to shake Sal’s hand or kiss it.”

According to MCA, Consultants for World Records was paid a commission of 3% on the net proceeds from the Sugar Hill distribution deal--amounting to $76,000 in 1984--despite the fact that neither Pisello nor Consultants are mentioned in the agreement.

Advance Payment

In addition, according to MCA internal auditors, Consultants received a $50,000 advance against 1985 proceeds on the Sugar Hill deal at a time when Sugar Hill was in arrears to MCA to the tune of $1.7 million and it was “doubtful” that MCA would ever owe the 3% commission.

Consultants also received advances totaling $130,000 on two other business deals that ultimately proved unsuccessful for MCA.

In each case, Pisello “guaranteed” the advances by writing MCA undated checks, which ultimately proved worthless due to insufficient funds. MCA is still in possession of the checks, according to auditors.

Following the MCA-Sugar Hill distribution negotiations, Pisello was instrumental, according to MCA, in the company’s purchase of the Checker/Chess/Cadet catalogue of master recordings of classic rock ‘n’ roll songs from Sugar Hill.

In return for Pisello’s help in arranging the sale, MCA forgave $130,000 of the advances to Pisello that were “guaranteed” by undated checks.

To purchase the Checker/Chess/Cadet catalogue, MCA canceled Sugar Hill’s $1.7-million debt and lent Sugar Hill another $1.3 million “to assist them with current cash-flow problems,” according to a May, 1985, report by MCA internal auditors.

In November, shortly after disposing of Checker/Chess/Cadet, its most valuable asset, Sugar Hill filed for protection under Chapter 11 of the U.S. Bankruptcy Code.

According to MCA auditors, $300,000 of the $1.3-million Sugar Hill loan went to pay off a priority interest in Checker/Chess held by Morris Levy, president of New York-based Roulette Records and a target, along with Pisello, of all three federal grand jury investigations.

Larger Figure Claimed

However, according to Al Bergamo, former president of MCA Distributing and the man who negotiated the Sugar Hill contract for MCA, Levy’s security interest in Checker/Chess was actually $1 million, not $300,000.

Toward the end of the Sugar Hill distribution negotiations, “I had lunch with Pisello at the Palm restaurant (in West Hollywood) and he brought the $1 million up to me--it was the first I’d heard of it,” Bergamo said. “He told me that unless we paid the million Sugar Hill owed to Morris Levy, we could lose the deal. He said if I could get $1 million (from MCA), he’d take care of me. It sounded like he was offering a bribe. I reported it to (MCA Records President) Irving Azoff and (Executive Vice President) Myron Roth, and Myron said, ‘We’ll face that issue when it comes.’

“If the MCA report says Sugar Hill owed Levy only $300,000, then somewhere along the line someone must have paid him another $700,000,” said Bergamo, who left MCA shortly after the Sugar Hill negotiations were completed.

MCA’s outside counsel, Alan Susman, said previously that Roth and Azoff “categorically deny that Bergamo informed them of any proposal by Pisello to offer Bergamo a bribe.” Susman referred to Bergamo as “a disgruntled ex-employee of the company.”

Levy’s attorney, Leon Borstein, said Friday that as far as he knew his client’s security interest in Checker/Chess had been $300,000, as claimed by MCA. “We feel that we are the victims here, like MCA.”

Following the hearing Friday, Pisello denied the prosecutors’ allegations that he had made $700,000 on his various transactions with MCA, which he described as “1,000 % legitimate.”

He called MCA “the nicest corporation in the world. There was nothing wrong in this on MCA’s part. We’re the victims here--me, MCA, Roulette and Levy.”