State upbraids plan to give NJ casino license to mobsters’ relatives, calling it ‘a travesty’

Plan to give mob kin a casino license is upbraided

ATLANTIC CITY, N.J. — Saying a New Jersey Casino Control Commissioner had “a predetermined result” in mind when he recommended that relatives of high-ranking mobsters be awarded a casino license, the state Division of Gaming Enforcement blasted the decision as “a travesty.”

In documents made public Monday, the division says the commissioner ignored overwhelming evidence that owners of a concrete reinforcing company continue to have contacts with organized crime figures.

The blistering appeal contains exceptionally harsh criticism rarely expressed publicly between New Jersey’s casino investigators and the commissioners who must make the final decisions on whether to grant the license.

At issue is a recommendation last month by Commissioner William Sommeling, acting as the casino commission’s hearing officer, to grant a casino industry license to Bayshore Rebar of Pleasantville.

The company’s owners, Joseph N. Merlino and his mother, Phyllis, are related to jailed Philadelphia mob boss “Skinny Joey” Merlino. Joseph N. Merlino and “Skinny Joey” Merlino are cousins. Lawrence “Yogi” Merlino was Joseph N. Merlino’s father, and Phyllis’ husband until she divorced him. He later died in the witness protection program.

In his ruling, Sommeling said he believed the Merlinos’ assertion that they had “separated ourselves from that side of the family” in order to win permission to work in the Atlantic City casino industry.

That prompted a harshly worded appeal from the gaming enforcement division that all but asserted the fix was in from the beginning of Bayshore’s third attempt to win a casino license. (It has been rejected twice before by the commission for associations with mob figures.)

“At every turn, the division disagrees with the hearing examiner’s characterization of facts that is so distorted as to lead to what can only be viewed as a predetermined result that these applicants were qualified for casino service industry licensure and that the hearing was a superfluous exercise,” wrote the division’s director, Josh Lichtblau.

He said Sommeling’s recommendation, if it is allowed to stand, will rewrite the commission’s own standards regarding ties to organized crime associates.

“A new standard has been concocted to fit a bastardized outcome,” Lichtblau wrote.

Dan Heneghan, a spokesman for the casino commission, said the panel has to render a final decision in the matter, adding it would be inappropriate for either Sommeling or commission chairwoman Linda Kassekert to comment on Lichtblau’s assertions. A vote has not yet been scheduled.

John Donnelly, the Merlinos’ lawyer, was taken aback by the gaming enforcement division’s response.

“This is way over the top,” he said. “They are extremely angry that the facts didn’t support their position. They want to be judge, jury and executioner, and if someone gets in their way, too bad.”

The appeal notes that the Merlinos made or received numerous telephone calls to and from known organized crime figures. These included seven calls lasting 15 minutes each from prison from “Skinny Joey” Merlino, and 17 calls from prison from jailed mobster Marty Angelina.

Sommeling wrote in his decision that there was no evidence that anything illegal was being discussed.

Lichtblau wrote that the recommendation “flies in the face of established commission precedent and sets a new bar whereby some number of organized crime contacts is permissible and, if the contact is by telephone, acceptable, so long as the regulators do not know of the content of the conversation.”

Lichtblau also cites evidence that known organized crime figures including “Skinny Joey” visited the Merlinos at their Margate home numerous times in 1997 and 1998.

“Skinny Joey” Merlino is due to be released from prison on Sept. 7, 2011, following a conviction and 14-year sentence for extortion and illegal gambling.