DECEMBER 16, 1998
Click Here to See Related Picture
LONG TERM INVESTIGATION INTO WIDESPREAD THEFT OF AIR CARGO FROM JFK AIRPORT RESULTS IN INDICTMENT OF 56 INDIVIDUALS AND EIGHT CORPORATIONS; MULTI-MILLION DOLLAR THEFT, FENCING AND DISTRIBUTION NETWORK SHUT DOWN; LARGE QUANTITIES OF STOLEN MERCHANDISE SEIZED
Queens District Attorney Richard A. Brown, joined by Assistant Director in Charge of the New York Office of the Federal Bureau of Investigation Lewis Schiliro, New York City Police Commissioner Howard Safir, Director of Public Safety and Superintendent of Police of the Port Authority of New York and New Jersey Fred V. Morrone, New York State Police Superintendent James W. McMahon and Lee Heath, Inspector in Charge of the New York Region of the United States Postal Inspection Service, announced today the indictment of 56 individuals and eight corporations following a long term investigation, dubbed "Operation Rain Forest", into the theft, fencing and distribution of millions of dollars worth of air cargo stolen from facilities in and around John F. Kennedy International Airport (JFK) over the last three years.
District Attorney Brown said, "JFK Airport is one of New York City's most valuable economic resources. Every year, over 1.75 million tons of air freight of every kind -- from advanced computer and electronic equipment to luxury consumer goods and designer clothing -- passes through JFK on its way to or from cities across the nation and around the world. Thousands of New Yorkers and New York region businesses depend on this vast commercial hub for their financial survival and hundreds of thousands of consumers in the metropolitan area depend on it to supply the goods they need at competitive prices. As this investigation demonstrates, we are determined to put an end to air cargo thievery that fuels an underground economy that substantially undercuts honest businesses and which, if unchecked, has a significant impact on the region's business economy."
The District Attorney continued, "This investigation has revealed the existence of a distribution chain of stolen air cargo starting with the thieves, to the fences and then to established retail stores or, in some cases, to individuals who deal in black market goods out of their homes. It has resulted in the recovery of more than $5.0 million in cash and stolen property. While, in past investigations we have found individual employees involved in the theft and distribution of air cargo, today's indictment also charges eight corporations -- three of them freight forwarders and five of them retail establishments -- with participating in this property theft and stolen property distribution enterprise."
District Attorney Brown added: "While some companies have been indicted as part of the corrupt enterprise, others have played a significant role in cooperating with the investigation. One such company, BAX Global (formerly known as Burlington Express), had sustained significant losses for a 15-month period prior to the commencement of this investigation and was considering reducing the size of its operation at JFK Airport. In the past year, however, as a result of this investigation, those losses have been reduced dramatically and the company has been able to continue to operate, providing not only an unencumbered conduit for the distribution of merchandise, but jobs for members of the community."
FBI Assistant Director Lewis Schiliro said, "The indictments and arrests announced today demonstrate not only the resolve of the collective law enforcement community to prevent, investigate and prosecute air cargo theft at one of America's busiest transshipment hubs, but they also demonstrate the need for continued vigilance in this area. Eighteen months ago most of us were present for the announcement of the indictment and arrest of 83 defendants in a previous air cargo theft ring at Kennedy Airport. Where commerce is conducted and there is money to be made, there seems always to be those who are willing to steal it rather than earn it. Our job is to minimize the opportunity to steal and vigorously enforce the law against those who do."
Police Commissioner Safir said: "One of the goals of the NYPD's Strategy 98 was the reduction of property crimes. Operation Rain Forest is an excellent example towards that end. As a result of this case, we have already recovered almost $5 million worth of stolen property and taken in $1.5 million through forfeiture. I expect these amounts to rise. Let this case send a very clear message to those who might think that the NYPD and its law enforcement partners take crimes against property lightly. Let all those who wish to prosper - the thief, the fence and the broker - know that the full weight of the NYPD and all law enforcement will pursue them, arrest them and convict them. I am extremely proud of the excellent work of the NYPD's Major Case Squad under the supervision of Captain George Duke and Sergeant Buddy Murnane."
The Port Authority's Director of Public Safety and Superintendent of Police, Fred V. Morrone, said: "The Port Authority has made enormous strides in recent years in reducing the incidence of on-airport cargo theft. Cargo crime at Kennedy Airport is extremely low. Last year, the value of cargo stolen at JFK was less than one-half of one one-hundredth of one percent of the cargo shipped through the airport. As this investigation shows, we are working aggressively with District Attorney Brown, the NYPD and other law-enforcement agencies to reduce the amount of cargo stolen from warehouses and other facilities off the airport."
Postal Inspector Lee Heath said, "Criminal activity, whether it be post office burglary or warehouse thefts, is encouraged and facilitated by those that make a buck buying and reselling stolen goods. This investigation serves to disrupt a well-organized fencing operation which spread theft and racketeering in New York City."
New York State Police Superintendent James W. McMahon stated, "I commend District Attorney Brown for his continued efforts against organized elements that have a negative impact on the honest residents of Queens County. The New York State Police are proud to assist in the dismantling of this sophisticated, multi-million dollar crime ring. This is truly a shining example of police agencies working together for the common good of the community."
District Attorney Brown said that the investigation began in June 1996 when a supervisor of Burlington Air Express (now known as BAX Global) reported to the police that he had observed two employees steal four laptop computers from the company's warehouse at JFK Airport. The employees were arrested by the Port Authority Police and detectives of District Attorney Brown's Airport Investigations Unit and the New York Police Department's Major Case Squad began an investigation into past thefts that had been reported at the airport. Over the course of the ensuing months, and with the cooperation and assistance of BAX Global and inspectors of the United States Postal Service, court authorized eavesdropping was begun.
"As a result of the court authorized wiretaps and other investigative initiatives" said District Attorney Brown, " a multi-million dollar a year fencing operation allegedly headed by the defendant Lewis Luxenberg and operated out of his home at 2839 Bragg Street in Brooklyn was discovered. After further investigation a cadre of thieves was uncovered, including two union shop stewards and two other alleged fences, Israel Dov and Louis Tranese, who allegedly supplied the defendant Luxenberg with merchandise stolen from air cargo facilities in and around the airport and in addition, several retailers who routinely purchased the stolen goods from the fences for re-sale in stores located in Manhattan, Brooklyn and Staten Island."
According to the District Attorney, among the items sought to be fenced through the distribution network or recovered during the investigation were:
Kodak cameras and over 10,000 rolls of Kodak film;
Toshiba, Texas Instruments, Hewlett Packard, Epson, Quantum Atlas, Western Digital, Maxtor and IBM computers, hard drives and computer parts;
DMI computer chips and GHZ transistors;
$242,000 worth of cigars;
Estee Lauder, Hugo Boss, Yves St. Laurent perfume;
Over 11,000 Remington Electric Shavers valued at $1.8 million;
Nicotrol anti-smoking kits and cases of Excedrin brand name pain reliever;
16 cases of Braun digital ear thermometers;
Designer clothing manufactured by Versace, Paul & Shark, International Waters, Izod, Reebok, Tahari, Kasper, Levi and Liz Claiborne;
Pharmaceuticals and prescription drugs;
Rodenstock brand-name eyeglass frames and Versace sunglasses;
One hundred eighty-eight thousand 32-cent United States postage stamps;
$40,000 Liberty Mutual settlement check;
$155,800 worth of American Express travelers checks; and
Over $300,000 worth of avionics including aircraft data computers and an aircraft fuel pump.
According to District Attorney Brown, of the 56 individual defendants indicted, 20 defendants and eight companies controlled by them have been charged under New York State's Organized Crime Control Act with Enterprise Corruption and other crimes in one 59 count indictment. If convicted of Enterprise Corruption the individual defendants face up to 25 years in state prison. The remaining 36 defendants are charged in 23 additional indictments with various crimes including grand larceny, criminal possession of stolen property and other offenses. If convicted, they face various sentences with maximums of 7 and 15 years depending on the charge.
According to the indictments, which were unsealed today, a group of BAX Global warehouse employees, dubbed the "Nacci crew" by investigators, and the owners of two air freight companies, Anthony Palese (LUV's Container Station, Inc.) and Alfred and Dennis Hill (Admiral Air Freight Service, Inc.), stole millions of dollars worth of computers, computer chips, hard drives and transisters as well as perfume, pharmaceuticals, designer clothing and sunglasses, electric shavers (worth $1.8 million alone), thermometers and other goods from their own warehouses and from BAX Global over a three year period beginning in September 1995. It is charged that the stolen merchandise was then fenced through Lewis Luxenberg, Louis Tranese and Israel Dov who would in turn sell them to retailers including the defendants Harry Shasho, the owner of New Tech Video and Computer Ltd., a Manhattan electronics store, Gloria Fago, the owner of a Staten Island clothing boutique, George Green, the owner of Zoo Loo on U, Inc., a Brooklyn clothing store, and Norman Sternberg, the owner of three gift shops located in Staten Island.
District Attorney Brown said, "These indictments should send a loud and clear message to would-be air cargo thieves, fences and dishonest retailers that their criminal activities will not be tolerated. The importance to the City of New York in maintaining a major, competitive commercial air freight hub is too great to allow this kind of activity to exist. With the cooperation of private freighters like BAX Global, the law enforcement community can put a stop to air cargo theft and pilferage for which the consuming public, in the last analysis, foots the bill."
Beginning early this morning a force of over 300 police officers, detectives and investigators of the New York Police Department, Queens District Attorney's Detective Bureau, Port Authority Police Department and New York State Police took most of those charged into custody. Others are still being sought. Those arrested will be arraigned later today in Queens Supreme Court before Supreme Court Justice Joseph Rosenzwieg.
The investigation was carried out by Sr. Investigator Charles P. Siriano of the District Attorney's Detective Bureau, under the supervision of Chief Edward T. Brady and Deputy Chief Lawrence J. Festa, Det. Sgt. Buddy Murnane of the New York City Police Department's Major Case Squad which is under the command of Captain George Duke and which is part of the New York Police Department's Special Investigations Division under the supervision of Deputy Inspector Robert A. Martin, Supervising Postal Inspectors Edward Cuebas and Leonard Kennedy and United States Postal Inspectors under their commands, Sr. Investigator John Cassino and Inv. Joel Downing of the New York State Police under the supervision of Lt. William Baker and Captain Mark Smith and Dets. John Trotter and Michael Molina of the Port Authority Police Department under the supervision of Lt. Robert Carron, and FBI Agents under the supervision of Supervising Special Agent Anthony Nelson.
The Grand Jury presentation leading to today's indictments was conducted by Assistant District Attorneys Bill Gianaris and Meryl Lutsky of the District Attorney's Airport Investigations Unit which is under the supervision of Brian J. Mich, Chief of the District Attorney's Organized Crime and Rackets Bureau and the overall supervision of Executive Assistant District Attorney for Investigations Robert D. Alexander.
It should be noted that an indictment is merely an accusation and that a defendant is presumed innocent until proven guilty.