Romandi Sentencing Memo

UNITED STATES DISTRICT COURT DISTRICT OF CONNECTICUT UNITED STATES OF AMERICA v. ERIC ROMANDI : : : : : Criminal No. 3:06cr161(EBB) February 27, 2009 UNITED STATES’ MEMORANDUM IN AID OF SENTENCING The United States files this Memorandum in Aid of Sentencing the defendant Eric Romandi and respectfully recommends a sentence of 46 months of imprisonment, which is at the high end of the advisory range and one that is fully called for by the interests of justice, is supported by the Sentencing Guidelines and justified by the statutory sentencing factors set forth in 18 United States Code, §3553(a). Background As the Court well knows, in mid-2003 law enforcement officials began an investigation into organized crime’s infiltration and control of Connecticut’s trash industry. The investigation revealed that a central group of companies operated by James Galante and his silent partner Thomas Milo formed the core of the enterprise. Galante controlled more than 25 trash hauling and related companies. Nearly all were headquartered on the site of Galante’s trash transfer station, 307 White Street, Danbury, Connecticut. Galante also owned investment companies and a minor league hockey team, the Danbury Trashers, as well as a race car team, Mystique Racing. The investigation revealed that Galante did not act alone; several family-owned companies in Connecticut and eastern New York also participated in a scheme to fraudulently eliminate competition and fair pricing for garbage collection services (“property rights system”).1 The wide sweeping investigation initially utilized an undercover agent (“UC”) who posed as a rogue salesman for a large, national waste hauler. The UC quickly established a corrupt business relationship with Galante’s lead salesman, Richard Galietti.2 In August 2004, this Court authorized the government to wiretap Galietti’s telephone conversations. Within a few months, the telephone conversations of James Galante and his principal associates, Ciro Viento and Richard Caccavale3, were also being intercepted pursuant to court order. The wiretap investigation continued for the next eleven months with ten telephones and a politician’s office being monitored. The wiretap evidence, which included over 50,000 intercepts, proved devastating to the defendants, as the recorded conversations revealed numerous illegal dealings between trash haulers. In July 2005, federal law enforcement agents executed over forty search warrants in Connecticut and New York and seized more than $500,000 in cash and over 5,000 boxes of documents. A year-long grand jury investigation followed. In June 2006 a federal grand jury sitting in New Haven indicted twenty-nine individuals and ten corporate defendants, charging the vast In this regard, several principals and employees of non-Galante companies including Joseph LoStocco, Gary Mueller, Alan Ferraro, David Magel, Anthony Novella, Dennis Bozzuto, Jeremy Everett, Scott McGowan, J.R. LoStocco, AJ Wallinger, Jason Manafort and Phil Armetta have pleaded guilty to various federal charges. This Court has sentenced Galietti, a first time offender, to the high end of his advisory Guidelines range: 46 months of imprisonment. Caccavale and Viento, like Galietti, had no convictions prior to the instant prosecution. This Court has sentenced both men to 30 months of imprisonment, which was at the middle of their advisory Guidelines range. -23 2 1 majority with racketeering, racketeering conspiracy, mail and wire fraud, obstruction of justice and tax violations. Additional defendants were charged in a separate indictment. A superseding indictment followed in June 2007, adding kidnaping and arson predicates to the racketeering conspiracy. The investigation also revealed that Galante relied on a cadre of loyal employees and associates, including Mr. Romandi. Specifically, Romandi: (1) torched a rival carter’s truck with Galante in 1992; (2) tampered with grand jury witnesses in 2005; and (3) participated in aspects of Galante’s schemes to hide income from the Internal Revenue Service. The Truck Arson In the early hours of May 28, 1992, Mr. Romandi and others combined to burn a rival carter’s truck. At 6:15 a.m., as a 57 year old truck driver attempted to empty a roll-off container at the Berkshire Shopping Center in Danbury, Connecticut, the defendant and another donned ski masks and green overalls and approached the driver. Brandishing a firearm, the men told the driver: “don’t cause any trouble and you won’t get hurt.” They grabbed the driver and brought him down an embankment into a swampy area, where they taped his hands behind his back, taped his legs together, and placed tape over his eyes. The men told the driver to warn his employer to be careful about what his company does in Connecticut and New York. Romandi then lit the truck on fire, causing approximately $68,000 in damage. A few hours after the arson, shortly before 8:00 a.m., Romandi brought one of AWD’s gray colored Ford Thunderbirds to Barnaba Motor Sports in Danbury. Galante used this dealership to have his personal luxury vehicles (Ferrari and Porsche, among others) serviced. In addition, Galante had many of his company’s vehicles – mostly Thunderbirds at the time – serviced at Barnaba’s -3- facility, which went out of business in the mid-90’s. A copy of the repair order generated by the dealership indicates that “Eric” dropped of a 1991 Thunderbird on behalf of AWD on the morning of May 28, 1992, and requested that someone “remove gasoline from trunk area.” The interior of the car was very muddy in the driver and all three passenger areas. An employee recalls seeing two homemade clubs in the back seat and two jumpsuits in the trunk (no masks, however), and noted a very strong odor of gasoline. The vehicle was cleaned as instructed. Later that day, Galante telephoned the dealership and demanded that a new repair order be issued that did not contain any reference to “gasoline.” An employee followed Galante’s instructions and rewrote the repair order to specifically exclude reference to gas odors. See PSR at ¶¶ 23-32. The Obstruction of Justice/Witness Tampering The government’s covert investigation into the racketeering enterprise progressed to an overt phase on July 19, 2005, with the execution of 42 search warrants and the service of scores of grand jury subpoenas. In the wake of these events, the government interviewed a former employee at AWD who was a trusted assistant of Galante. The government ultimately compelled this woman to testify before the grand jury. Prior to her grand jury appearance, Galante spoke to her about questions the government might ask. Subsequently, Galante tasked Mr. Romandi with the very sensitive job of meeting with the employee to instruct her how to answer questions in the grand jury. Thereafter, Romandi contacted the employee to review the questions she had discussed with Galante. The employee and Romandi met in a conference room at Galante’s business location. Romandi instructed her how to answer questions on several different subjects, all of which were material to the ongoing racketeering and tax investigation. Specifically, Romandi told the employee to lie about her interactions with Joe Milo, whether Lisa Henry ever worked for one of Galante’s -4- companies, the cash that Romandi and another kicked back to Galante on a weekly basis, and information concerning fraudulent expenses claimed by Galante. In addition, on January 22, 2006, the employee’s father attended a Danbury Trashers hockey game at the Danbury Ice Arena. While there, Romandi asked how his daughter was doing. Specifically, Romandi told the father that his daughter did not have to continue to meet with the FBI unless she had a subpoena. Mr. Romandi then gave the father a handwritten list of questions that he wanted to find out if the government had asked the daughter about during interviews and/or grand jury appearances. Later, when the father showed his daughter the list of questions, she became distraught and destroyed the document. However, some of the questions that she recalls seeing included: What does Eric Romandi do for the company? Did the Feds show you pictures of Tina Samuelson or Lisa Henry? Did the feds ask about Joe Milo? The Tax Conspiracy Mr. Romandi has also pleaded guilty to Count 81, which charges a multiple object Klein Conspiracy and involves various acts of tax fraud. The defendant’s involvement in this multiple object conspiracy was threefold: (1) his receipt, along with a second individual (FT), of multiple paychecks, one of which Romandi and FT cashed and gave back to Mr. Galante; (2) his involvement in attempting to influence FT from testifying truthfully about the scheme before the grand jury; and (3) his involvement in the skimming of cash from a portion of Galante’s business. With regard to the multiple paycheck scheme, the government would show at trial that an object of the conspiracy involved allowing James Galante to reduce his federal tax liability by failing to report income he received from both Mr. Romandi and FT. This income also reduced the tax See PSR at ¶¶ 38-42. -5- liability of the corporations, because it was issued in the form of a payroll check that was later fraudulently deducted as a business expense on the corporate tax return. Galante caused Romandi to receive three paychecks and caused FT to receive two paychecks. Galante then directed Romandi and FT to provide him with weekly cash payments that represented a portion of the proceeds of these checks. Both Romandi and FT regularly cashed one or more of these multiple paychecks and caused some or all of the cash to be delivered to Galante via his secretary, who put the cash in Galante’s safe and distributed it to various persons, including Joe Milo, at Galante’s instruction. With respect to the defendant’s obstructive conduct, during the grand jury’s investigation of Galante’s fraudulent tax activities, FT was subpoenaed to testify in part about the multiple paychecks. FT has stated that his second paycheck was part of a scheme he and Galante concocted in order to siphon cash from Galante’s company and funnel it back to Galante, tax free. FT has also stated that when he and Galante learned of the scope of the federal investigation, he, Galante and others attempted to legitimize the second paycheck by calling it a loan and, to “document” the existence of the loan, they created fake, fraudulent and fictitious loan documents purportedly executed in 2001 and 2003 that characterized the weekly cash payments as loans from FT to Galante. In fact, these purported loan documents were created and executed in 2006 in an attempt to obstruct justice and impede an ongoing Grand Jury investigation. FT would testify that in May 2006, Galante and others suspected that FT was planning to testify truthfully before the grand jury. Romandi began looking for FT, even to the point he was seen peeking into FT’s windows after FT refused to answer the phone or door. -6- Finally, the government’s evidence would show at trial that it was part of the tax conspiracy that from at least in or about 2000 through and including 2005, Galante caused a portion of the cash proceeds generated by companies he controlled, including but not limited to TSI and AWD, to be provided directly to him and not reported to the Internal Revenue Service. Specifically, Romandi regularly retrieved cash from the scale house located at 307 White Street and then deliver a portion of this cash to Galante’s secretary, who in turn provided the cash to Galante. The money was not reported as income to the Internal Revenue Service. In this regard, the evidence would show that the defendant caused employees who received cash at the scale house to maintain incomplete records of such cash received from customers. Certain employees were instructed not to permanently record either the customer’s name or the date the cash was received on the designated form. Such instructions were designed to prevent a full and accurate recording of the cash receipts generated by TSI. See PSR at ¶¶ 33-36, 42. The Interests of Justice The gravity of the offenses under consideration in this case is beyond dispute. Racketeering conspiracy, predicated upon arson and obstruction of justice, coupled with tax conspiracy, are serious matters. This Court has made very clear in the numerous sentencings that have preceded the instant matter that what occurred in this case cannot be ignored or left unredressed. The Sentencing Guidelines The Probation Office has analyzed in detail the Sentencing Guidelines applicable to the defendant’s offense conduct and criminal history and suggests a range of 121 to 151 months of imprisonment. See PSR at ¶ 67. This analysis, however, is driven by the view that the 1992 truck arson also involved a kidnaping of the victim driver. While the state of the law in 1992 supports this -7- view, and the government obviously supported this view at the time of superseding indictment, the Connecticut Supreme Court has recently articulated a much narrower definition of kidnaping. See State v. Salamon, 287 Conn. 509 (2008) (holding that when a restraint or a movement of a victim is merely incidental to the commission of another crime, then a kidnaping has not occurred.) Accordingly, for the purposes of this sentencing, the government urges this Court to impose a sentence within the agreed upon Guidelines range of 37 to 46 months of imprisonment. The government submits that in assessing where within the Guidelines range to fix sentence, the fact that the defendant might have been legitimately exposed to a ten year term of incarceration had his sentencing date occurred earlier, is a factor to consider. The Statutory Sentencing Factors: 18 U.S.C. §3553(a) The sentencing Court should consider all of the statutory factors enumerated at 18 U.S.C. § 3553(a) to determine whether they support the sentence requested by a party. Gall v. United States, 128 S.Ct. 586, 596 (2007). The United States addresses the factors as follows: (1) the nature and circumstances of the offense and the history and characteristics of the defendant: The nature and circumstances of the offenses are troubling. The defendant’s criminal history, moreover, includes a 39 month stint in federal prison for his involvement in heroin trafficking. Finally, the defendant’s long involvement with Galante also augurs for a 46 month jail term: in 1992, the defendant torched a competitor’s truck and pointed a gun in the driver’s face; in 2005, when Galante understood he was subject to federal grand jury investigation, he turned to the defendant to coach witnesses to tell lies and half-truths. These important sentencing factors are examined below. -8- A racketeering conspiracy, by its very nature, constitutes a very serious federal offenses because unlike other crime, the crime requires an enterprise. That is, a defendant’s conduct only becomes criminal when he knowingly associates with a larger group or pack of criminals who have united to cheat, steal, extort, or otherwise victimize citizens. Successful enterprises rely on cohesion and coordination. But given the human dynamic, the goal of unity must sometimes be attained through violence and the threat of violence. A second, equally pernicious aspect of racketeering is that the enterprise model, by design, shields the most culpable leaders from exposure to the law while sacrificing the less sophisticated participants to the judicial system. As the Court knows, this prosecution has revealed that for several decades the defendants operated a fraudulent scheme – known as the “property rights system” – to eliminate competition for garbage collection services. The defendant’s role in the scheme was critical to its success. While the defendant did not participate in the day-to-day price rigging tactics, his utility to the operation dates back to the early 1990s, when he delivered “a message” to a rival carter to “stay out of Connecticut.” People did not want to buck the system, in part, because of a well founded concern for their safety. Simply put, no one wanted to have a gun stuck in their face or have their truck – the lifeblood of most garbage operations – torched. These folks knew that it might happen because, in fact, it did happen. Nor did Romandi’s value to the enterprise ever decline. Over a decade later, when federal authorities searched all of Galante’s companies and were attempting to interview witnesses and subpoena employees to a grand jury, Galante turned to this defendant to control the testimony of people he was concerned would tell the truth. Our tax system, moreover, is driven by the honesty of those citizens and corporations who pay their fair share. Unfortunately, some citizens opt for a different path, knowingly cheating their -9- fellow citizens by engaging in a host of schemes to under report income or over claim deductions. When a tax cheat is caught, the message must be sent that such conduct cannot be excused. Otherwise, others “on the fence” will be emboldened to proceed in a similarly dishonest fashion. Accordingly, violation of our tax laws constitutes a very serious offense. Here, the defendant kicked back some of his salary to Galante and helped skim cash from part of the AWD operation. The history and characteristics of the defendant also call for 46 month jail term. Unlike many of the defendants in this case, Mr. Romandi has a prior significant criminal history – one that should have served as a loud wake up call and not a means to enhance his reputation as Galante’s loyal and able fixer. In 1980, the defendant was sentenced to serve a federal sentence of 39 months following his conviction for body packing kilograms of heroin to smuggle into the United States from Bangkok, Thailand. See United States v. Clark, 613 F.2d 391, 398 (2d Cir. 1979) (explaining that in September 1977 Romandi body packed kilograms of heroin and brought it into the United States at LaGuardia Airport). Thus while the defendant’s service in Viet Nam weighs in his favor, that service is undercut by the fact he returned to Southeast Asia within years of leaving Viet Nam to smuggle heroin. (2) the need for the sentence imposed – (A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense: This Court has repeatedly emphasized that the racketeering and tax conspiracies at bar are extremely serious offenses, warranting imprisonment for even those tangentially involved. The defendant’s involvement in the racketeering conspiracy involved a truck burning at the outset of the conspiracy and witness tampering in the twilight of the conspiracy: Eric Romandi was there in the -10- beginning and at the end and, all along, dutifully serving James Galante’s unambiguously illegal interests. A 46 month jail term aptly reflects this defendant’s culpability and will not be so skewed from the other sentences imposed in this case as to constitute an injustice. In fact, it is a sentence much lower than that recommended by the Probation Officer. At the end of the day, a 46 month term of incarceration is an appropriate disposition for a man who has previously served 39 months of imprisonment for importing heroin, only to join James Galante’s racketeering enterprise. A 46 month sentence, moreover, is on par with other defendants such as Richard Galietti, a defendant who had no prior convictions and was 19 years old when Romandi pulled a gun on a truck driver, bound him and set fire to his truck. The Court has consistently imposed sentences in this matter with an eye toward promoting respect for the law. This particular case is no different. (B) to afford adequate deterrence to criminal conduct: A sentence at the high end of the advisory Guidelines range will satisfy the goal of general deterrence because it will starkly warn others who might be tempted to step into a similar role that strong arm tactics have no place in civilized society. (C) to protect the public from further crimes of the defendant; and It is hoped that the defendant will not commit further crime, but that is presumably the analysis that applied when Judge Nickerson sentenced Mr. Romandi to 39 months of imprisonment on a prior occasion. (D) to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment in the most effective manner: -11- The defendant has not exhibited a need or propensity for rehabilitative training. Accordingly, this factor is irrelevant to the Court’s sentencing decision. (3) the kinds of sentences available: The parties have agreed that a sentence within the advisory range is appropriate in this case. (6) the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct; and This Court has previously sentenced Richard Galietti to 46 months of imprisonment and James Galante to 87 months of imprisonment. Although Mr. Romandi’s conduct was substantively different than Mr. Galietti’s, it was every bit as crucial to the successful operation of the property rights system. In fact, Mr. Romandi’s participation in the 1992 truck arson made it possible for his co-defendants to intimate that other, similar strong arm tactics might be applied to recalcitrant carters. By the time law enforcement began wiretapping the defendants’ telephones in 2004, the threat of violence frequently replaced the actual need for violence. Conclusion James Galante headed an extensive organization that constantly sought to crush competition in the garbage industry while falsely promoting the impression of actual competition. To accomplish this goal, he initially employed violence and, having solidified his reputation, threats of violence, to bring area carters into line. Eric Romandi was Galante’s “go to guy” in 1992. Years later, when federal investigators searched Galante’s companies and opened a grand jury investigation, Galante again turned to Eric Romandi to handle the sensitive task of influencing witness testimony. The theme is unmistakable: this defendant was a vital and loyal cog in the Galante machine, willing to do the jobs that no one else would or could be trusted to do. A sentence of 46 months of -12- imprisonment is appropriate, especially given that the defendant has previously served a 39 month federal jail term. Respectfully submitted, NORA R. DANNEHY ACTING UNITED STATES ATTORNEY /s/ MICHAEL J. GUSTAFSON FEDERAL BAR NO. ct 01503 ASSISTANT UNITED STATES ATTORNEY 450 MAIN STREET HARTFORD, CONNECTICUT 06103 Certification I hereby certify that on February 27, 2009, a copy of foregoing Memorandum in Aid of Sentencing was filed electronically and served by mail on anyone unable to accept electronic filing. Notice of this filing will be sent by e-mail to all parties by operation of the court’s electronic filing system or by mail to anyone unable to accept electronic filing as indicated on the Notice of Electronic Filing. Parties may access this filing through the court’s CM/ECF System. A copy of this Sentencing Memorandum was also emailed to USPO Ray Lopez. /s/ Michael J. Gustafson MICHAEL J. GUSTAFSON ASSISTANT UNITED STATES ATTORNEY 450 MAIN STREET HARTFORD, CONNECTICUT FEDERAL BAR NO. CT 01503 PHONE: (860) 760-7960 FAX: (860) 760-7979 E-MAIL: MIKE.GUSTAFSON@USDOJ.GOV /s/ MICHAEL J. GUSTAFSON ASSISTANT UNITED STATES ATTORNEY -13-