MCGUIRE: THE TRUCKS ARE ROLLING
Byline: Arthur Friedman
NEW YORK — Nearly three years into his five-year term as the court-appointed special master over intracity garment industry trucking, Robert J. McGuire feels his office has helped create open competition where there was once “the closed-fist velvet glove.”
“We feel very positive about what’s happening in the marketplace,” said McGuire, who was police commissioner of New York in the Seventies.
“There’s been a serious 15 to 20 percent downward price structure, and manufacturers are openly negotiating with gypsy trucks and independents. While some of the downward pricing is economic in nature, people also have a sense of assurance now that the Gambino cartel is gone and there’s a level playing field once again.”
McGuire, who is president of Kroll Associates, a top international investigations firm, was appointed special master in May 1992 as a result of a plea agreement between the Manhattan District Attorney and Thomas and Joseph Gambino. The Gambinos, sons of the late crime boss Carlo Gambino, pleaded guilty, along with several co-defendants, to restraint of trade by illegally controlling garment trucking between manufacturers and contractors in New York City.
Michael Slattery, a former FBI agent and McGuire’s chief investigator, oversees the field-monitoring aspect. He supervises the equivalent of six full-time agents who routinely interview manufacturers, truckers and contractors to make sure they’re following the rules known as the “Truckers Bill of Rights,” created by McGuire to foster competition.
“We’re continually monitoring to assess the business environment,” Slattery said. “We want to make sure the genie doesn’t ever get out of the bottle.”
Slattery said he works closely with attorney Robert Anello, the assistant to Elkin Abramowitz, counsel to the special master’s office. Anello handles any legal proceedings involving the office, such as the hearings that were held during the past year or so to determine payouts to a victim’s compensation fund set up as part of the plea agreement.
McGuire said the final deliberations and payments have just been made to victims of the trucking cartel, resulting in awards totaling $700,000. The original compensation fund was set at $3 million, but McGuire said that only $700,000 was found to be justifiable, and that the balance has been returned to the State of New York. The names of the victims receiving cash awards is sealed by the court, Slattery noted.
“I can tell you some of the stories were really tragic and sad to hear,” Slattery said. “There were a lot of truckers and manufacturers who lost their livelihoods, not to mention their personal freedoms, because of the Gambino-led cartel that fixed prices and hindered competition with less-than-desirable tactics and the specter of organized crime that the Gambino name carried with it.”
Late last month, McGuire got court approval to revise the rules of his office, allowing him auditing jurisdiction over subcontractor truckers as well. In addition, the court is expected to announce later this month that two more trucking companies will be subject to the special master’s jurisdiction.
“After an inquiry, certain things came to light that resulted in these trucking companies agreeing to abide by the rules involving financial auditing,” said Slattery, who said he couldn’t reveal the names of the truckers until the court has given final approval. “They would also be subject to sanctions for not following proper procedures.”
Leafing through a stack of classified documents, including correspondence and depositions on how the environment has changed on Seventh Avenue and in Chinatown, Slattery said, “It’s very satisfying to hear that we’ve made a difference.”
Several manufacturers, speaking on condition of anonymity, agree with one executive, who said the “worry of the Gambinos coming after you is no longer there.”
“Yes, prices have come down a bit, and I can talk to whoever I want,” said one manufacturer.
Another executive, who makes goods in Chinatown, said, “I can use or negotiate with any trucker I want without getting a phone call from Julie.”
“Julie,” he said, is a former Gambino trucking company associate who called regularly to make sure the manufacturer wasn’t using other truckers or to tell him how much he owed on “invoices that didn’t exist.”
This practice, referred to in the trial as double billing, was how the Gambinos protected their routes, McGuire said.
As part of the plea agreement, the Gambinos agreed to divest their interests in four trucking firms and get out of intracity apparel trucking. Thomas Gambino is currently free on bail, pending appeal of a five-year sentence on federal racketeering and gambling charges. Joseph Gambino continues to run Dynamic Delivery, an interstate shipper that was not involved in the trial or plea agreement.
McGuire said he does not expect any extension of his office once the term expires in 1997, but that decision will ultimately fall in the hands of State Supreme Court Judge Thomas Galligan, who oversees the plea agreement and the special master.
“We feel at that point there could be some sort of industry-controlled monitor,” McGuire said. “Organized crime is not what it used to be. Most of the members of the Gotti family are in jail or under tight scrutiny. Plus, once the chains are unraveled as they have been, I doubt they will become entwined again.”