Commentary: The Music Industry and the Mafia

How Organized Crime Shaped Our Business

By Dawoud Kringle

“The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side.” – Hunter S. Thompson

There is a FaceBook group that was started by a childhood acquaintance with whom I went to elementary and high school. One day, a few years ago, someone posted a song by a 60’s kiddie pop group who was signed to Buddah Records. I shocked the group by posting a comment detailing the fact that Buddah Records, and much of the music these people grew up listening to, was controlled by the Mafia. Most of my childhood acquaintances refused to believe me.

The original focus of the Mafia’s involvement with musical artists would be a deal to protect artists and help them achieve success. However, as soon as they achieved this success, more often than not, the mob would turn on them and extort them using intimidation methods.

It’s impossible to discuss organized crime in the music industry without mentioning Morris Levy. Levy was a music producer, founder of Roulette Records, and owner of the Strawberry Record Stores chain, whose reach was so extensive, he was nicknamed “The Octopus.” Levy was a Jewish Gangster, like Meyer Lansky, Arnold Rothstein, and Bugsy Siegel, all of whom played important roles in organized crime. Within the hierarchy of organized crime, Levy was answerable to Genovese Family boss Vincent Gigante (being a Jew, he could never be an actual member of the Italian Mafia), and was friends with Genovese boss Tommy Eboli.

In 1966, Tommy James’ first hit, “Hanky Panky,” was a success after a period of obscurity. James went to New York to negotiate a record contract for himself and his band, the Shondells. After a number of potential offers he signed with Morris Levy and Roulette Records. The day after signing with Roulette, James found that the offers he had gotten the day before had suddenly been retracted under threat from Roulette.

Levy would fraudulently list himself as the publisher of music he produced, thus keeping the publishing rights and royalties for himself, and cheating the rightful artists out of their money. He would also pirate the master tapes of major artists, duplicate the tapes, press copies of the records and fill his and other stores with these counterfeit copies at a reduced price. The artists would see records of their own music flying off the shelves, and they wouldn’t make a dime from the sales of publishing. They’d complain to their record companies, and the companies knew it was Levy who was doing this. They complained to Levy, and he would charge hundreds of thousands of dollars to put a stop to criminal activity he was committing. Then he would do the same thing to another record company and their artists.

Levy made millions from this; and the artists were afraid to say anything, because of his Mafia connections and because he often used violence as a way of extorting his artists. He was also heavily involved in payola, and paid DJs cash under the table to push his artists. In 1980, one of Levy’s bodyguards, Nate McCullogh, was murdered by persons unknown, and Levy was suspected of being involved in this.

Levy was convicted of extortion in 1990, on charges from an FBI investigation of the alleged infiltration of organized crime into the record business. He died of natural causes before he was to turn himself in.

Frank Sinatra was a prime example of how the mob reputedly infiltrated the music industry; where they would lend a helping hand to get many of the stars we have come to know and love, hit the big time. Sinatra neither confirmed nor denied the allegations. But it was common knowledge that Sinatra was friends with men such as Joe Columbo, Carlo Marcello, and John Franzese, and was rumored to have acted as a liaison between Joe and John F. Kennedy and the Mafia.

Michael Jeffery, former manager of Eric Burdon and the Animals, and the Jimi Hendrix Experience, was reputed to have had ties with organized crime on both sides of the Atlantic. A former soldier in the mob, Jon ‘Riccobono’ Roberts, wrote in his memoirs of the kidnapping of Hendrix. Two young men with aspirations to become professional criminals saw Hendrix in the Salvation Club (which was run by the Mafia), saw an opportunity for some quick cash, took Hendrix by force out of the city and called his manager demanding money. The club manager was informed and gave Riccobono a call saying that Jimi Hendrix had been taken. A couple of phone calls later, they got the names of the kidnappers, and gave them the very clear message that Hendrix was not to be harmed. A week later, Riccobono went after the young Italians, and gave them “a beating they would never forget.” Hendrix was the highest paid performer in the world during the last two years of his life. Jeffery was constantly skimming money from Hendrix’ accounts, and much of it was believed to have been funneled into a dummy real estate development corporation in the Bahamas. Some people believe that Hendrix’ death in 1970 was a murder, and was orchestrated by Jeffery. In 1973, Jeffery flew in a chartered airplane from London to New York to testify about money missing from Hendrix’ accounts, when he was killed in a midair collision with another aircraft.

Berry Gordy was the founder of Motown Records, the largest black-owned business ever seen, and created the Motown sound. His records not only became hits, but classics from Smokey and the Miracles, Diana Ross and the Supremes, Martha and the Vandellas, Little Stevie Wonder, the Four Tops and the Temptations. For years many have claimed Motown was started with mob money, which also put Gordy under surveillance by the FBI. Gordy vehemently denied the allegation. But according to federal documents and confidential informant files, Gordy used a loan from the Italian mafia in Detroit as part of his seed money to start his empire. Philly Groove founder John (Stan the Man) Watson utilized muscle and intimidation tactics provided by the Black Mafia in Philadelphia to grow and sustain his label.

One informant file from a Michigan State Police dossier claims Gordy took a loan of a few thousand dollars from the Detroit mafia’s Meli crew in 1959 in which he used to expand his then-Tamla Records to the Motown label and several more subsequent labels under the Motown banner. Gordy made back the money fast and repaid the Meli family by the end of 1960. Patriarch Angelo (The Chairman) Meli was one of the modern-day Detroit mafia’s founding fathers. He served as the syndicate’s underboss from 1936 until his death of natural causes in 1969. His faction of the Borgata handled labor racketeering. Meli’s brother Frank and nephew, Vince, were two of his top lieutenants and heavily involved in the music industry who co-owned Meltone Music, White Music Company and Jay-Cee Music with fellow Motor City mobsters Michael (Big Mike) Polizzi (financial expert) and Raffaele (Jimmy Q) Quasarano (strong arm, wholesale drug dealer and hitman. He and Polizzi later became consiglieres). They also controlled area distribution of juke boxes as well as maintained leverage in all local club bookings.

Gordy also had an alleged relationship and business dealings with Edward (Big Foot Eddie) Wingate, a Detroit policy kingpin, mob-backed gambling specialist and prolific legitimate businessman with deep ties in the music industry. Beside cop-turned-drug boss Henry (Blaze) Marzette, Wingate was the most prominent African-American underworld figure in the city throughout the 1960s. Per FBI records of the day, Big Foot Eddie’s illegal numbers business spread across every Black neighborhood in town. The operation  was backed by the Detroit mafia’s Corrado crew.

Buddha Records, founded in 1967 and distributed by MGM, was partially owned as a silent partner by Colombo underboss John “Sonny” Franzese. They released records by artists from a variety of music genres, including the Ohio Express, the Lemon Pipers, the 1910 Fruitgum Company, Melanie, the Shangrilas, Gladys Knight & the Pips, Bill Withers, Jay and the Americans, the Isley Brothers, and Captain Beefheart. Morris Levy tried shaking them down for a cut from the Shangrilas’ hit “Walking in the Sand,” but Franzese (who Levy was unaware was a silent partner) talked him out of it (Franzese was originally going to kill Levy, but changed his mind). Franzese was also partners with club owner Norbie Walters. They later became partners in Walters’ management and booking agency. When Franzese went to prison, his son Michael took over many of his operations, including his work with Walters’ businesses. When the elder Franzese returned from prison, he set up a meeting with Walters in the Stage Delicatessen in New York City to discuss his cut of some money he felt that Walters owed him as a partner in their music business dealings. Walters claimed not to remember their relationship as a partnership. Franzese asked him “If I put a bullet through your head, and that pastrami sandwich lands with your brains all over the table, would that refresh your memory?” Michael Franzese, who was in attendance, managed to smooth things out, and Walters survived the meeting. In later years, Walters made the mistake of using Franzese’ name to shake down professional athletes. This did not end well.

Tommy Mottola, the former head of Sony Music, and ex-husband of singer Mariah Carey, was the subject of a widely read, unflattering piece in Vanity Fair that accused him of ties with organized crime.

In the 90s, Madonna had a boyfriend, Chris Paciello. Paciello became a prominent figure on the club scene in Miami in the 90’s, making millions from two night clubs and a restaurant. He was later indicted, convicted and sent to prison for 10 years on a mafia related murder that transpired in his home state of New York. Madonna’s girlfriend Ingrid Caseres, reportedly even accompanied him to mob meetings. After loosing his money and fame to federal indictments, lawyer fees and incarceration, Paciello turned state’s evidence on the mob and served 7 years in prison.

In 2002, Los Angeles Times writer Anita Busch was reported to have been looking into the federal indictment of reputed Mafia captain Anthony (Sonny) Ciccone on charges of extortion and threatening to kill actor Steven Seagal. Ciccone was also involved in the Anthony Pellicano wiretap, harassment and witness tampering scandal where writer Anita Busch was targeted. Pellicano worked for clients such as Madonna and Tom Cruise. The federal government stated that Pellicano has mob ties and tried to put a hit on an incarcerated man that worked with him, to stop him from testifying in a wiretap scandal that has exposed several Hollywood stars.

In 1983 a series of exposes’ shook the record business and MCA Records in particular. Over the next four years, several dark corners of the industry were exposed, including a network of independent promoters who influenced Top 40 airplay through bribes of cash and cocaine, and a 200-million album a year cutout industry infiltrated by the Mafia. Later, however, the US Justice Department, which had apparently gone to great lengths to protect MCA Records’ parent company, MCA, Inc. President Reagan had ties to MCA and its longtime chairman, Lew Wasserman, one of the most powerful men in Hollywood at the time. The Justice Department’s Organized Crime Strike Force had long been suspicions about mob involvement with small, independent labels. There was, however, no apparent mob connection with the Big Six companies: CBS, WEA, Capitol-EMI, BMG, Polygram and MCA, which accounted for 90 percent of the record business in America. Until 1983, when Irving Azoff, (manager of the Eagles, Jimmy Buffett, Chicago), became president of the MCA Records Group, MCA was fiscally the weakest of the Big Six. Soon, Sal Pisello, a career racketeer with connections to New York’s Gambino Family, Pisello had managed to slip into an informal position at MCA (never had a title or a salary and apparently knew nothing about the record business). He soon ended up in control of MCA cutouts (the record industry’s remainders and overstock; deleted from a label’s catalog, that are sold to dealers for anywhere from 10 cents to a dollar). When Azoff took over, there were 10 million cutouts in MCA’s warehouses which had been sold through sealed bids to the highest per-unit bidder. LaMonte struck a deal with Pisello, purchasing 4.2 million albums and cassettes for $1.3 million.

John LaMonte was working his way back after a 1977 prison term for record counterfeiting, and entered into a distribution deal with Pisello. Pisello demanded off-the-book cash payments (and double-billings that would secretly net Pisello three to five cents per album). Another sign of trouble was when Morris Levy appeared out of the blue as the deal’s guarantor. One day, 60 tractor trailers arrived with 600,000 of the records LaMonte ordered missing because Pisello had sold them to a competitor. Levy demanded payment, which LaMonte refused.

Federal prosecutor Marvin Rudnick was assigned a two-count income tax-evasion prosecution of Sal Pisello dating to the late ’70s. Following a paper trail, Rudnick eventually connected Pisello to MCA, and pursued his suspicions that bigger crimes were being committed. As Pisello’s deals began to unravel on the West Coast, LaMonte’s problems escalated when Levy began pressing for payment. Soon, a Levy associate named Gaetano “Corky” Vastola beat LaMonte, breaking his jaw, fracturing his eye socket and crushing his sinus cavities. Soon after, LaMonte became an undercover government witness, later entering the witness protection program. Levy and Gaetano went on trial for extortion conspiracy in the MCA cutout deal. After the media began looking into the scandal, MCA fired Pisello, and Azoff did what Donald Trump would do: He passed the blame, sullied others and portrayed himself and his company as unaware victims of either criminal subterfuge or government harrassment.

The media’s and the Justice Department’s attention shifted from Pisello and MCA to the issue of payola. After a downturn from the late ’70s industry boom, many labels had cut back on staff, including promotion departments. That opened the door for a group of independent who would receive anywhere from $500 to $3,000 for getting a new single added to the playlist at a key radio station. By the early ’80s, they had become all-too-powerful and costly. One of these promoters, Joe Isgro, was making $5 million a year, more than any average two record company presidents combined. In1986 when NBC began airing reports on independent promotion, payola and mob connections, all the majors except CBS severed their ties to the network of promoters. Isgro was targeted by a grand-jury investigation, and eventually filed a $25 million antitrust suit against the majors, claiming a conspiracy to put him out of business. Azoff and MCA Records were also engaged in a secret campaign to break its power by providing the names of suspect promoters and programmers to the government.

After Rudnick got a conviction in the Pisello case, he was fired in 1989 for “insubordination and failure to follow orders.” The same week, MCA had the top three albums on the charts and Azoff was honored by MCA chairman Lew Wasserman in a full-page Billboard ad. Two months later, Azoff resigned to form his own label, Giant, leaving with some $30 million in MCA stock. Pisello served two years of a four-year sentence on tax evasion. Isgro’s 57-count indictment was dismissed in 1990 for prosecutorial misconduct. None of the aforementioned promoters or radio programmer were ever convicted on payola or tax-evasion charges. Levy, found guilty of the extortion of John LaMonte, sold his music business holdings in 1990 for a reported $70 million and died before he could begin his 10-year sentence. Gaetano Vastola is now serving a 17-year sentence. LaMonte remains in hiding. No MCA executives were ever charged. Lew Wasserman made $300 million when MCA, Inc. was sold in 1990 to Japan’s Matsushita conglomerate for $6.1 billion, and remains as chairman of the company. Marvin Rudnick is now in private practice in Los Angeles.

The recent changes in the music industry will have obviously affected how organized crime operates within it. In the past, it wasn’t difficult for the mob to make duplicate copies of master recordings and sell them counterfeit copies of vinyl or cassettes at wholesale price, and make a profit. However, the digital age has transformed the music industry and even though cashing in on the music business by means legal and illegal is not as easy as it once was, there is still money to be earned. Starting about 15 years ago, music illegal downloading and file sharing created serious interference with anyone wishing to make a profit from music, and the tech giants like Apple, Amazon, Spotify, and ByteDance have assimilated the lion’s share of money in the music industry. There haven’t been any recent reports about the mob’s involvement in the newer technologies. That said, it’s a safe bet they still have a seat at the table and their hand in the till.