Even the trial of federal witness Anthony Sarivola bears secrets

June 24, 1991|By Thom Loverro | Thom Loverro,Western Maryland Bureau of The Sun

The day in court for Anthony Sarivola, the former organized crime enforcer and FBI informant accused of swindling a Western Maryland commuter airline, has come and gone, with no trial, no reason for postponement and no new date in sight.

The prosecutor isn't saying why the case, scheduled for June 10, was postponed.

"I don't know," said Ethan Bauman, assistant U.S. attorney.

His boss isn't saying why it was postponed.

U.S. Attorney Richard Bennett said the case was postponed by Judge Frederic N. Smalkin, who was supposed to hear the matter. "That's all I can tell you," he said.

Judge Smalkin isn't saying why it was postponed.

"It was just postponed," he said. "You can talk to the parties about it. I'm not going to discuss it with you."

Mr. Sarivola's public defender, Mary French, isn't saying why either. "I can't comment on it," she said.

And no one will say if Mr. Sarivola will ever stand trial.

A cloak of secrecy has fallen on everyone involved in the case of Anthony Sarivola, alias Anthony Steele, who was in the Federal Witness Protection Program and may still be under federal protection.

He is accused of wire fraud in connection with his aborted purchase of financially troubled Cumberland Airlines.

Officials may not want to talk about Mr. Sarivola, but they do want to talk to him.

Investigators from the Seattle office of the Securities and Exchange Commission recently flew to Baltimore to question Mr. Sarivola. The office has expressed interest in his dealings with Coastal Maine Holdings Corp., a Florida corporation that a federal indictment contends is a worthless company used to swindle the owners of Cumberland Airlines.

Mr. Sarivola is accused of using Cumberland Airlines in his attempt to buy the bankrupt Braniff Airlines -- hoping that he could resurrect Braniff along with several smaller airlines.

The SEC in Seattle filed charges in August 1990 against Mr. Sarivola, charging that he had violated anti-fraud provisions of securitieslaw in his aborted takeover attempt of the De Laurentiis Entertainment Group, a major film company that later declared bankruptcy.

Meanwhile last week, the SEC in Fort Worth, Texas, filed charges against a former business associate of Mr. Sarivola, Jeffrey Reynolds, a flamboyant young Texas investor also linked to a string of sour business deals.

Mr. Sarivola acquired Coastal Maine Holdings from Mr. Reynolds who, along with eight others, is charged by the SEC with providing false and misleading information to investors about several worthless oil and gas companies.

The federal indictment in Baltimore involving Cumberland Airlines charges that Mr. Sarivola, 36, under his alias Anthony Steele, purchased Cumberland Airlines in February 1990 from owner Alfred D. Nicholson using fraudulent financial documents.

Mr. Sarivola wired Mr. Nicholson financial documents showing that the shareholders' equity in Coastal Maine was worth more than $43 million and the company's total assets were $56 million, the indictment alleges.

Mr. Sarivola promised to pay $50,000 to shareholders in Cumberland Airlines, along with 250,000 shares of Coastal Maine stock. Mr. Nicholson said he was told the stock was worth about $4 a share at the time.

In return, Mr. Sarivola would get Cumberland Airlines and its assets, which primarily consisted of a flight school and about 13 single- andtwin-engine airplanes.

But the indictment says that the Coastal Maine stock was worthless. Although the deal was voided, Mr. Sarivola had depleted most of Cumberland Airlines' assets by traveling around the country at the company's expense, the indictment states. The planes were later repossessed by Mercantile Bank.

Mr. Sarivola was arrested March 12, 1991, by FBI agents at a business office in Newark, N.J. He was held in the Baltimore City Jail until April 19, when U.S. District Judge Paul Rosenberg agreed to release him on $200,000 bond secured by a deed to his parents' home pending his trial.

At the same time, Mr. Sarivola was wanted in Everett, Wash., on numerous charges of theft and writing bad checks.

These involved an operation whereby he guaranteed that for a fee he could get financing for people who needed money, usually for a business deal, court documents state. Mr. Sarivola, operating as Anthony Steele, took money from people but never delivered on the financing promises, according to the complaint by the Snohomish County prosecutor's office.

A trial date in that case was postponed numerous times because of Mr. Sarivola's alleged health problems, and he eventually failed to show up for a trial on the charges in May 1990.

Yet he was allowed out on bail in the most recent case in Baltimore.

Mr. Sarivola has not been the successful federal witness that the FBI had hoped for after his arrest for extortion in 1982.

Known as "Tony Limo," he was a loan shark for the Columbo organized crime family in New York and also worked as an enforcer for reputed mobster Anthony "Tony C" Carrozza.

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