Inspectors took bribes, records say Liquor board workers accused of soliciting payoffs from city bars

Suspects' phones wiretapped

Court documents show defeated politician held influence over board

August 02, 1998|By Walter F. Roche Jr. | Walter F. Roche Jr.,SUN STAFF

Maryland prosecutors have filed documents outlining in remarkable detail a protection racket that they say operated in the Baltimore liquor board, generating thousands of dollars in payoffs to liquor inspectors and to the politically connected mastermind who put it all together.

The papers filed by state Prosecutor Stephen Montanarelli's office since the indictment May 7 of six people in an investigation of the city Board of Liquor License Commissioners portray a system of rewards and punishments. Those who paid were protected and warned of planned raids by liquor inspectors or the police. Those who didn't pay faced repeated raids and violation notices.

Some liquor inspectors routinely collected cash or even sexual favors in return for protecting certain bar owners. The payoffs ranged from fine cigars and $50 restaurant gift certificates to $1,000 in cash, according to the documents.

As a bonus to those who paid them off, the same inspectors systematically harassed owners of competing bars not in on the scheme, the documents allege. And, prosecutors contend, for those liquor inspectors who cracked down, even unwittingly, on a "protected" bar there was another kind of penalty -- they were threatened with being fired.

The documents were included in court filings that are part of the disclosure process leading to the trial in September of the six people -- including the board's former chief inspector, Anthony J. Cianferano and William J. Madonna Jr., a 46-year-old former bar owner and one-time state delegate. Included in the documents arepartial transcripts of wiretaps of key figures in the probe, a 155-page affidavit to justify the wiretaps and a 19-page memorandum, known as a bill of particulars, outlining the alleged conspiracy.

Transcripts of the wiretaps show that the defendants openly discussed their illegal activities in the same conversations in which they warned each other of possible wiretaps. In one conversation recorded by prosecutors, Cianferano is heard instructing a city liquor inspector on how to tip off a bar owner about an impending raid.

"What you should do is call him up and ask him to call you back from a pay phone," he says, according to a transcript of the wiretap.

Perhaps the most unusual aspect of the documents filed by prosecutors is the light they shed on the extraordinary influence wielded over the board and its inspectors by Madonna, who prosecutors allege virtually controlled the agency, even though he held no title or official position there.

According to the affidavit, one former inspector told investigators that his primary job wasn't to enforce the liquor laws but "to create revenue for Madonna by soliciting and accepting bribes."

Appointment of inspectors

Madonna, prosecutors have charged, controlled the liquor board controlling the appointment of liquor inspectors -- including Cianferano, who ran the inspection unit. At times, Madonna would not even bother with Cianferano. Instead, prosecutors say, he issued orders directly to inspectors.

On one occasion, court-approved wiretaps capture a former state senator, John A. Pica Jr., calling Madonna to ask him about the status of a liquor license application.

Until his indictment, Madonna held a job with the state Lottery Commission. He was once the owner of two taverns in the city regulated by the liquor board and owned a video poker machine business. His influence with the board apparently stems from the patronage of state Sen. Barbara A. Hoffman of Northwest Baltimore and Baltimore County, who acknowledges that she routinely relied on Madonna's recommendations for appointments to liquor board jobs she controlled.

Hoffman helped Madonna win a job with the state lottery as a liaison with ticket agents around the state, a job he resigned from just before the indictments were announced. Last year, she was behind an unsuccessful effort to have him appointed to the liquor board's top administrative job.

Senator to testify

Hoffman, who is scheduled to testify for the prosecution in the case, says she was duped by Madonna and had no idea of a protection racket of the sort described by investigators. "I guess I just got snookered," she said.

Cianferano, Madonna and the four other defendants all have pleaded innocent to the charges of bribery and conspiracy to thwart enforcement of the liquor laws. A trial is expected to start in the fall.

Asked for comment on the new allegations, Gary Bernstein, Madonna's lawyer, called them "absolutely incredible. I find that hard to believe. I'm astounded to hear that."

Cianferano's lawyers declined to comment.

Payoffs and betting

The new details include:

Two liquor inspectors, Donald J. Harlow and Donald Cassell, were collecting regular payoffs from nearly two dozen bars and restaurants, according to the prosecutors' memorandum.

Cianferano, the chief inspector, collected cash payments from the owners of eight bars over a nine-year period ending in 1996, the documents say.

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