Wiretaps reveal talk about Mon Valley gambling

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He called people "baby cakes," "honey" and "dear," according to wiretaps. He didn't want padlocks on his video poker machines because it would make them look "ghetto." He described a tablet of paper with notes about the money flow from the machines as his "bible." And police raids were "all part of business."

Over 134 pages of a search warrant affidavit compiled by investigators, Ronald "Porky" Melocchi of West Newton and his associates expounded in recorded conversations on running what authorities called a million-dollar gambling ring in the Mon Valley.

"I took a little kiss at the Viking yesterday," Mr. Melocchi was recorded as telling a confidential informant in November after a state police raid on video gambling machines at the Viking Lounge in McKeesport. "I got raided."

Mr. Melocchi brushed off the situation, though, as "no big deal" and said one of his men had luckily picked up $8,000 from a safe there 20 minutes earlier.

"Well, we're back in operation already. We're back in, and everything's good," Mr. Melocchi said. "That's what I do, I just keep rolling, you know."

Mr. Melocchi's alleged illicit business apparently stopped rolling, at least for a time, last week when he and 15 others were charged with various gambling-related crimes after a three-year probe by the state.

The affidavit, in which agents with the Pennsylvania attorney general's office and Pennsylvania State Police laid out their case for searching homes, businesses, banks and a car -- leading to the confiscation of $1.1 million in an investigation dubbed Operation Pork chop -- provides a window into the day-to-day world of an alleged gambling operation that included video machines, illegal lotteries and bookmaking.

Mr. Melocchi said at one point, "I'm out here to make money and I ain't. If you noticed, I'm not driving nice cars and I ain't livin' in $300,000, $400,000 house."

But that belied his true financial situation, according to investigators, who wrote: "The investigation has further confirmed that Ronald Melocchi is making enormous profits from his gambling enterprise and that the proceeds from this illegal gambling operation are being laundered through legitimate businesses that Melocchi may own."

On the wiretap, Mr. Melocchi is recorded talking about how to split proceeds, setting up new ventures and his business network. He discusses his plans and his children. He carps about problems such as carrying too much cash, an associate who refuses to have a phone in his name and a former partner who he believes stole $17,000. And he talks about his co-workers, calling one longtime friend and co-defendant, Eugene "Red" Kowalski, "dumb as a box of ... rocks" and poking fun at him for not picking up on the math involved in the business after 18 years of working together.

Mr. Melocchi's attorney, Bruce Carsia, said he had not seen the search warrant.

"I ain't no punk," Mr. Melocchi is quoted as telling one accused associate, Forward Police Chief Mark Holtzman, in October after relating a story about a bettor who claimed he was owed $1,000 more than he got from a video machine payout.

"He looked at me and said, 'You know, I could drop a dime on you, but I ain't gonna do that. I'll get my money other ways.' I don't know who ... he thinks he's dealin' with," Mr. Melocchi said. "If he got connections, so do I. And you know who some of mine are."

In October Mr. Melocchi said he planned to start another vending company with a different name.

"I'm going to build a whole new separate route," Mr. Melocchi told a friend, according to the affidavit. "So it don't look like I'm so big. See, I'm at 70 locations right now. And I don't want to get too much bigger than that. So what I'll do is I'll flare off and I'll put this in for my kids."

Sprinkled in the affidavit are hints of other facets of Mr. Melocchi's suspected dealings.

One section links him to the Pagans motorcycle gang. The affidavit cites a confidential informant describing how a Pagans member beat up "Pappy," a bar owner, and "fined" him $10,000 "to protect the interests of Melocchi's operation."

Mr. Melocchi boasts on the wiretap about his connections in McKeesport with the mayor.

"It's sweet. Me and the mayor are like this, I let, I do whatever I want in that town." Mr. Melocchi said.

Whether that was mere braggadocio or truthful commentary is unknown. McKeesport Mayor Mike Cherepko has declined interview requests. But his solicitor, J. Jason Elash, said the mayor and Mr. Melocchi were only acquaintances.

Campaign finance records show that Mr. Melocchi contributed a total of $3,650 to Mr. Cherepko's campaign in 2011 and 2012, and Mr. Melocchi's wife donated another $400.

Police had been aware of Mr. Melocchi -- and his Glassport-based business, Back Alley Vending -- for years.

Mr. Melocchi pleaded guilty in 2001 to five misdemeanor counts of gambling devices for having machines that paid off in a Mama Pepino's pizza shop in White Oak.

By January 2002, the state police organized crime unit was talking to Mr. Melocchi, according to the affidavit. He agreed to cooperate in exchange for "consideration" on potential charges.

In 2008, state police charged Mr. Melocchi with gambling devices and disorderly conduct after discovering video slot machines in a McKeesport bar. The first charge was dropped; Mr. Melocchi pleaded guilty to the second, a summary offense.

The search warrant affidavit reveals that Mr. Melocchi met in October 2008 with an IRS agent and a state trooper to talk about the vending business.

"Melocchi admitted to operating 360-400 illegal video display gambling devices and other, legitimate machines at approximately 63 (sixty-three) locations, yielding between $800,000 to $900,000 in revenue annually," the affidavit said.

Asked what resulted from that conversation, the IRS declined comment. Maria Finn, a state police spokeswoman, said she was limited in what she could say because the investigation was ongoing.

"But I can tell you that the interview you're asking about was just the beginning," Ms. Finn said. "Much more evidence was needed and in doing so, investigators found there were several other people involved."

In October 2010 state police launched what would become Operation Pork Chop.

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Jonathan D. Silver: jsilver@post-gazette.com, 412-263-1962 or on Twitter @jsilverpg.


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