8 Indicted In Probe Of Preate Donations The Former Illegal Game Operators Are Accused Of Obstructing A Grand Jury's Look At Campaign Gifts.

Posted: September 27, 1994

HARRISBURG — A federal grand jury investigating campaign contributions made to State Attorney General Ernie Preate Jr. has returned indictments against eight former illegal video-poker-machine operators in the Scranton area, charging them with obstruction of justice.

Seven of the men also were charged with committing perjury before the grand jury, based on their denials of allegations that they made secret cash contributions to Preate's political campaign committees.

FBI agents and officers of the Pennsylvania State Police Organized Crime Division yesterday arrested Elmo Baldassari and William Ferrario of Scranton; Eugene Caljean and Frank Mancuso of Archbald; Gary Frey and Charles J. Kokinda of Moosic; Alfred Pelicci of Hallstead; and Donald G. Plappert of Old Forge.

The indictments were filed Friday. U.S. Attorney David M. Barasch, who announced the indictments, declined to comment yesterday. The grand jury investigation is continuing, according to a news release from Barasch's office. If convicted, each defendant faces up to 10 years in prison and $500 in fines, according to the news release.

What this all means for Preate is unclear. His unsuccessful bid for the Republican gubernatorial nomination earlier this year was dogged by reports about the federal inquiry and a Pennsylvania Crime Commission investigation of his ties to video poker operators.

Preate declined to comment on the indictments.

He has previously denied all allegations of wrongdoing. He has accused Crime Commission officials of retaliating against him because he had proposed abolishing the agency, a charge commission officials denied.

The commission accused Preate of taking the contributions from video-poker- machine operators in exchange for directing his prosecutorial resources away from the vendors.

The indictments state that the grand jury has been reviewing contributions, some unreported, by owner/operators of video-poker machines to "a local law enforcement official" in 1987 and 1988, in exchange for lax prosecution.

The law enforcement official is widely assumed to be Preate, who was Lackawanna district attorney at the time. He was elected state attorney general in 1989.

The indictments also state that the grand jury is looking into allegations that, because of the contributions, enforcement of the laws outlawing video poker "were obstructed by state law enforcement officials and others from November of 1988 to the present."

The indictments of the eight men allege that during grand jury appearance they gave false testimony and concealed facts relating to "secret payments."

The indictments say that "the evidence received as part of this investigation established that in excess of $40,000 was collected from the aforementioned owner/operators of illegal video-poker machines by an individual known to the grand jury for delivery to a person described herein as a state law enforcement official, with approximately one-half of that amount constituting unreported cash contributions."

The only man not charged with perjury is Baldassari, who is charged with one count of obstruction of justice based on testimony made less than four weeks ago and again last Friday.

According to the Crime Commission, Preate in 1987 sought out Baldassari, a reputed Scranton-area loan shark, to help him raise money to reduce an $81,000 debt left over from his 1986 election as Lackawanna County district attorney.

The commission said Baldassari referred Preate to Joseph Kovach, a Scranton video-poker operator who was Baldassari's silent business partner. Many of the

commission's findings were based on accounts, from other individuals, of what Kovach supposedly had told them before he died in 1991.

The indictments make frequent references to someone identified only as "an individual known to the grand jury" who allegedly solicited campaign contributions from the operators for Preate. The indictment of Plappert contains an excerpt of grand jury testimony that is used in part as the basis for his perjury charge. In it, Plappert is asked: "Did you know he was keeping a list of contributors?" Plappert answered: "No."

The commission alleged that Kovach kept a list showing which operators had given to Preate and which had not. Preate was supposedly aware of the list, according to the commission.

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