Here's some more 'skinny' re: Scranton businessman Louis DeNaples, his purchase of Mt. Airy Lodge in the Poconos and the smell test facing the Commonwealth in selecting from among those who are expected to try to obtain licenses for slots parlors as soon as the mechanisms for choosing are in place....
This might be a good time to indiccate that Northeastern PA has quite a history with organized crime figures from years back..the Bufalino family etc. originally having to do with rackteering in the coal business: I wouldn't venture to say that Mr. DeNaples falls within the same context. We'll see how it plays out......
Posted on Wed, Jan. 05, 2005
Potential slots applicant shows what board faces
By John Sullivan and Mark Fazlollah
Inquirer Staff Writers
Louis A. DeNaples, a Scranton-area businessman who wants to build a gambling hall at a defunct Mount Pocono resort he recently bought, might test some of the issues that the state's new gambling control board will face as it awards slots licenses.
The board, which is not expected to receive applications for licenses for many months, would have to navigate many aspects of DeNaples' activities, should he seek one.
DeNaples has had ties to politicians, giving heavily to their campaigns; to a gambling-board member; and - law enforcement officials say - to a reputed organized-crime figure.
And he has a federal felony conviction for fraud from 1978.
DeNaples did not return calls Monday and yesterday seeking comment.
"If Mr. DeNaples decides to apply for a license, he'll face the same scrutiny as anyone else who applies," Nick Hays, a spokesman for gambling board chairman Thomas A. "Tad" Decker, said yesterday.
Former gambling commissioners in other states said that any gambling control board must consider all relevant information in determining the fitness of an applicant.
"A person's background, including criminal history, financial dealings, and reputation in the community, are among the factors that are considered by every and any gaming-licensing authority," said Carl Zeitz, a former member of the New Jersey Casino Control Commission.
Zeitz, who would not speak directly to the DeNaples case, said that in New Jersey licensing decisions the standards of proof are substantially less than those in criminal courts.
"Evidence is given the weight regulators believe it should be afforded, unless there's something clearly disqualifying" an applicant, he said.
Pennsylvania's new gambling law stipulates that a criminal conviction automatically knocks out a slots applicant if the conviction occurred within the last 15 years.
Otherwise, the board must decide.
One of the members of the Pennsylvania Gaming Control Board who might be asked to do so is William P. Conaboy, a Scranton-area lawyer with close personal and financial ties to DeNaples.
The two men have been friends for 25 years.
Conaboy also sits on the board of the First National Community Bank in Dunmore, Pa.; DeNaples is the bank's director and its single largest shareholder.
Conaboy has earned $95,960 from the sale of bank stock, according to financial records. He also has a home mortgage through the bank.
Long before DeNaples purchased the Pocono resort - the 1,000-acre Mount Airy Lodge - he was mentioned by insiders at the state Capitol as someone interested in seeking a slots license. Less than two weeks after the legislature passed a bill allowing slot machines at 14 locations across the state, DeNaples and Scranton-area accountant Robert Rossi organized Mount Airy No. 1 L.L.C., the company that purchased the lodge for $25 million.
Since the purchase, reports of DeNaples' organized-crime connections have come to light, including his alleged association with William "Big Billy" D'Elia, whom law-enforcement have identified as the head of the Bufalino crime family in northeastern Pennsylvania. But many of those allegations have been circulating since the 1980s.
Between 1983 and 1990, DeNaples' name has appeared in three Pennsylvania Crime Commission reports alleging some association between him and suspected mob figures.
In one instance, the commission cited the involvement of a mob associate, James Osticco, in attempting to fix a trial in which DeNaples and three Lackawanna County government employees were charged with defrauding the federal government. DeNaples and the three others entered no-contest pleas on April 5, 1978, to federal charges of conspiracy to defraud the government. Each was given a three-year suspended sentenced and fined, the Crime Commission said.
James Kanavy, a former special agent with the Crime Commission, said he remembered DeNaples. "Based on Crime Commission surveillance reports, during the time of the surveillance D'Elia went to DeNaples Auto Parts on an almost daily basis," Kanavy said in an interview yesterday.
In 2003, the New Jersey Casino Control Commission banned D'Elia from doing business with any casino in the state, saying he had ties to the mob, according to the New Jersey Division of Gambling Enforcement.
"D'Elia has been identified by the Pennsylvania Crime Commission and the Federal Bureau of Investigation as a soldier in the Bufalino organized-crime family of La Cosa Nostra, otherwise known as the Pittston La Cosa Nostra family," said Daniel Heneghan, a spokesman for the New Jersey Casino Control Commission.
D'Elia filed a response to the ban in which he denied the charges, but he did not fight them, saying instead he would apply at a later date.
Other alleged contacts that D'Elia had with DeNaples were detailed in a 46-page affidavit submitted in May 2001 at a federal court in Harrisburg. The information in it was gathered by an IRS investigator and a member of the state police's organized-crime unit seeking search warrants in a federal investigation into an illegal multi-state gambling operation.
Four confidential informants alleged in the affidavit that DeNaples made payments to D'Elia and that in return D'Elia would do "whatever DeNaples needed," according to the affidavit. The document provided no further details.
Another informant said DeNaples made protection payments of an unspecified amount to D'Elia to keep the mob away from his businesses.
The affidavit also said that D'Elia worked as an independent middleman selling space in a DeNaples landfill.
No charges were ever filed against DeNaples or D'Elia in the case from which the affidavit arose.
Phillip Gelso, a Wilkes-Barre lawyer who represents D'Elia, declined to comment.
For years, DeNaples has made substantial contributions to local, state and national campaigns, both Democratic and Republican, according to state campaign records. During the last four years alone, DeNaples, his wife and his brother have jointly contributed more than $1 million to political campaigns through a variety of entities.
They gave $184,000 to the Republican National Committee and the Republican Congressional Committee, and an additional $24,000 to the Bush-Cheney drive and other federal campaigns.
They have given $262,550 to state and local candidates through their D&L Realty, including $50,000 to Mayor Street.
DeNaples' firm RAM Consultants gave $345,000 to state campaigns, including $115,000 to Gov. Rendell. And in their own names, they have made $212,000 in contributions in the last four years to Pennsylvania races.
DeNaples' partner in the Pocono project, Rossi, has also been a major contributor.
In the mid-1990s, Rossi was a heavy contributor to the political action committee of Philadelphia lawyer Ronald A. White, who died last year after his federal indictment on corruption charges.
Rossi and two associates gave money to Rendell's campaign for governor in 2001, donating a total of $30,000 that year and another $30,000 the next year.
Kate Philips, a spokeswoman for Rendell, who has long been a proponent of legalized gambling in the state, said DeNaples is just one among many contributors to the $42 million campaign fund he used in his run for governor.
Rossi did not respond to a request for comment.
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Contact staff writer John Sullivan at 717-787-5934 or
johnsullivan@phillynews.com. Inquirer staff writer George Anastasia contributed to this article.
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