Frank Viviano, San Francisco Chronicle Staff Writer
Monday, January 8, 2001
©2001 San Francisco Chronicle

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Palermo, Sicily -- Even on an island where murder is a daily occurrence, Sicilians took special notice of Giuseppe Di Maggio's end in the waning days of last summer, described in grisly detail by the island's press.

It was a message, they understood, a stark announcement from the nascent underworld group known here as Cosa Nuova, the "New Business" -- a reconstructed version of Cosa Nostra that is more mysterious than its parent and every bit as ruthless.

Di Maggio, 42, was treated to the incaprettamento, a classic Mafia assassination technique that translates as "goat-throttling." His hands and feet were bound to a single cord, passed through a noose around his neck. Then he was sealed in a plastic bag and hurled into the sea. The more he struggled, the tighter he pulled the noose, until he strangled himself.

Inflated into a macabre death balloon by Di Maggio's gasping, the plastic bag bore his corpse on a leisurely weeklong drift over the Gulf of Palermo, where a fishermen spotted it Sept. 21.

In the language of Silicon Valley, which is increasingly Cosa Nuova's own point of professional reference, the message was "make networks, not enemies."

Di Maggio's problem, in Cosa Nuova's view, was that he was a flamboyantly independent troublemaker who had little use for networking. Flamboyance is antithetical to Cosa Nuova's low-key corporate culture. But when killing is necessary, the New Business strikes without mercy.

That combination, say law enforcement officials, makes Cosa Nuova one of the most sinister forces in Italian history. It is also a key component in a global alliance of criminal syndicates -- a "Mafia Archipelago" that stretches from the Atlantic to the South China Sea.

THE MAFIA WARS

The rise of Cosa Nuova -- and its incorporation into the Mafia Archipelago - - can only be understood in the context of Cosa Nostra's fall and the emergence of a new Sicilian godfather known here as "Zu Binnu u Tratturi," or Uncle Bernie the Tractor.

From 1978 to 1994, the bloodiest power struggle in the history of organized crime raged in Sicily between Salvatore "Toto" Riina of Corleone and Gaetano "Tanu" Badalamenti of Cinisi, Giuseppe Di Maggio's hometown. The badly outgunned forces of order were caught in the middle. Palermitans refer to the bloodletting as the mattanza, an allusion to a brutal Sicilian fishing method in which entire schools of tuna are surrounded by boats and bludgeoned to death.

The mattanza killed an estimated 12,000 to 14,000 people in 16 years, on an island whose inhabitants number just under 5 million, about a million less than the population of the San Francisco Bay Area. Its victims included two mayors of Palermo, the leaders of the three largest political parties, and a long succession of magistrates and prosecutors, culminating in the 1992 assassinations of crusading anti-Mafia judges Giovanni Falcone and Paolo Borsellino.

But the majority of the dead, by far, were members of the rival clans and their families. Just two high-ranking bosses in the province of Palermo, Tommaso Buscetta and Salvatore Contorno, lost 72 relatives between them.

By the mid-1990s, the old Cosa Nostra was esaurita, exhausted, its organization shredded and its business interests reeling. More than 1,000 Cosa Nostra members became so-called "penitents" after losing their own parents, wives or children, and turning state's evidence.

"The mattanza was an act of suicide for the old Mafia," says Giovanni Impastato, the son and brother of two of the war's victims and a neighbor of the late Giuseppe Di Maggio. "Its successors understand that."

At the head of those successors stands Uncle Bernie the Tractor, a.k.a. Bernardo Provenzano, a man so discreet and elusive that the only contemporary images of him are speculative computer drawings.

The sole existing photograph of Provenzano, now 67, was taken in 1959, when he was 26. He has been on Italy's wanted list for 37 years, while slowly and relentlessly climbing the underworld career ladder.

Throughout the mattanza, the Tractor was always an exponent of what Mafia expert Umberto Santino calls "the line of mediation," the gradual building of clandestine alliances, rather than the declaration of open underworld war to consolidate power.

Today, Riina and Badalamenti are both in prison, along with hundreds of their sub-bosses and hit men, leaving Provenzano as the last member of the generation of bosses who ruled Sicily from 1970 to 1995 to remain alive and at large.

A master of disguises, he is believed to have been "hiding" in Palermo, right under the authorities' noses, since 1960. Remarkably, the godfather of Cosa Nuova is himself barely literate. The only confirmed writing sample in his hand, a letter to an underling acquired earlier this year by police, is a childish scrawl of misspellings and ungrammatical phrases in the dialect of his native Corleone.

Yet he is widely regarded as the chief architect of the Sicilian underworld's transformation into a modern institution with a global agenda, the alliance-building visionary who designed the Mafia Archipelago's working model.

CORPORATE MODERNIZATION

The signs of that modernization are everywhere in the landscape where the original Mafia was born a century ago.

In corporate terms, Giuseppe Di Maggio's incaprettamento was an extreme case of executive downsizing, the elimination of managers whose presence is no longer convenient to an enterprise. He is by no means its lone example.

If the Mafia war is over, under Provenzano the killing continues at the rate of roughly seven to 10 assassinations per week. The most notable details are the ages and presumed occupations of the targets.

Almost all are maverick underworld figures in their 30s or 40s who are regarded as too independent for the new corporate era. Unlike the years of the war, which left 87 major public officials dead in Sicily, none of the victims is a magistrate, police officer or political leader.

"The big front-page assaults of a decade or two ago -- the assassinations of judges and politicians -- boomeranged. They forced the state to act against Cosa Nostra, to go after its bosses," says Santino, the Palermo-based author of 15 books on organized crime.

State prosecutor Salvatore De Luca describes Di Maggio's murder as "a surgical intervention" meant not to usher the new organization into another war, but to maintain its equilibrium in the pursuit of new interests.

Increasingly, those interests lie beyond the reach of the authorities who triumphed over one generation of Mafia chieftains in the mid-1990s, only to see a more efficient successor rise in its place.

"In the course of the last year, our seizures of assets from organized crime in Sicily were worth a scant 44 billion lire ($22 million), less than 1 percent of our seizures across all of Italy," says Stefano Pitino, regional commandant of the Guardia di Finanza, Italy's tax police. "The reason is simple: The Mafia's money doesn't remain in Sicily anymore."

It has been invested in the Mafia Archipelago -- the network of formal alliances between underworld organizations in China, the Middle East, Latin America, and across Europe -- whose earnings are an estimated $30 billion per year.

Downsizing and low-profile reorganization are the keynotes to Cosa Nuova's internal corporate reform. But the fulcrum of its business plan is rapid globalization, on a scale that dwarfs the transatlantic heroin operations that once pitted Tanu Badalamenti against Toto Riina.

GLOBAL BUSINESS

No one in the law enforcement world can say, with certainty, what the precise Sicilian role is in this network. But Cosa Nuova's presence in the Mafia Archipelago is unmistakable:

On Sept. 17, Emanuelle Belfiore, 32, was arrested at Milan Airport while making a connection from Greece to Switzerland. A known boss of the Sacra Corona Unita, Cosa Nuova's chief underworld partner on the east coast of Italy,

Belfiore was carrying directives for the recycling of billions of dollars earned in the international smuggling of drugs, arms and human beings.

The same week, Carmelo Ferale, 43, an extortion specialist from Catania, Sicily's second-largest city, was arrested by Interpol in Arad, Romania, at the headquarters of a company registered to conduct "import-export activities" between Romania and Sicily. A few days later, another Catania man sought on organized crime activities, Vincenzo Cassissi, 39, was arrested by Interpol in Holland.

BUSINESS OF CONTRABAND

"I'm in the export line," a resident of Cinisi says over a friendly cup of espresso in Palermo. He shares anecdotes with a Chronicle reporter about trips to Hong Kong, Singapore, Bangkok and Istanbul. "I was treated very well by our contacts there," he says.

In the lawless Albanian port of Vlore, the reporter finds a luxurious restaurant hidden behind a high wall. The menu is Italian, and many of the clients converse in Sicilian dialect. "We're businessmen," one of them explains.

Vlore's only business is contraband. Its fleet of high-speed launches has smuggled hundreds of thousands of clandestine immigrants -- and tons of drugs - - into Western Europe in the past five years. Italian police seized just under 3,000 kilograms (6,600 pounds) of narcotics from Albanian traffickers in Italy in 1996, and another 2,500 kilograms shipped in from Albania. By 1998, the combined total had almost quintupled, to 23,000 kilograms.

In Budapest, the capital of Hungary and a major transshipment point for contraband arms, a pizzeria near the central railroad station serves as an unofficial clubhouse for resident Italians. Their cars, parked outside, all have license plates from Palermo or Catania. Similar establishments, with similar clienteles, lie as far afield as Moscow and Bar, the chief contraband port of Yugoslavia.

Yet even a cursory look at Sicily's economic profile, which borders on the surreal, raises questions about the nature of its "businessmen's" activities abroad.

Officially, economic development statistics for Sicily paint a picture closer to that of the Third World than a region in the wealthy European Union.

The island imported $8.61 billion in goods and services from abroad in 1999.

Yet after exports of oil processed at a refinery on the south coast are subtracted -- the income from those exports goes to the state oil cartel -- Sicily's official returns from exports are a meager $2.3 billion.

The value of Sicilian imports is nearly four times the value of its nonpetroleum exports. By contrast, Italy as a whole enjoys a solid export surplus with the rest of the world.

In Palermo, the major industrial center of the island, according to Italy's National Statistics Institute, the average "manufacturing enterprise" is a tiny Ma-and-Pa crafts shop employing just over four people, including Ma and Pa.

The province of Palermo's overall unemployment rate in 1999 was 28.7 percent; its youth unemployment rate was a staggering 70.8 percent. The corresponding figures for such northern regions as the Trentino-Alto Adige, above Venice, were 3.4 percent and 6.4 percent.

Officially, there is no money in Sicily. How then to explain the fact that there are automobile dealerships on almost every block in some Palermo neighborhoods?

Or that Sicily, with an official unemployment rate 10 times that of its northern neighbors, spends more on certain luxury foods than any other region in Italy?

How can those $8.6 billion in imports be explained?

Italy's police, who regularly send agents on site visits to Cosa Nuova's overseas haunts, have no illusions about the answers. Sicilian organized crime today is part of a huge multinational alliance. Its principal trade interests are drugs, weapons and a skyrocketing traffic in clandestine immigrants.

But apart from a few prominent busts such as those that netted Belfiore, Ferale and Cassissi, Italian police are powerless when it comes to arrest and prosecution in the new globalized era.

"We have no extradition treaty at all with Montenegro, for instance, and its harbors have become a perfect refuge for Italian criminals engaged in contraband smuggling or the traffic in human beings," says a law enforcement official. "Our only chance to arrest them tends to be during Catholic holidays, when they sometimes risk a trip back home."

Others cite a lack of cooperation from police agencies elsewhere in the Balkans and in the former Soviet Union. In any case, they say, Cosa Nuova's operations are often so discreet and fine-tuned that it is nearly impossible to make charges stick.

"The new Mafia is about quietly building consensus, adopting the latest business tools and recruiting bright people," says Giovanni Impastato.

"One of Cosa Nuova's innovations was to make the structure much more open to talent, at the same time that it drew further and further into the shadows, " says Santino. ''They recognized that there would be no future without expert assistance, without technicians."

There would be no future for the Sicilian Mafia, in short, without a third step toward modernization -- research and development -- to accompany Cosa Nuova's commitment to globalization and internal reform.

CRIMINAL R & D

On Oct. 18, hundreds of Italian police in masks and riot gear descended on the University of Messina, one of southern Italy's premier educational institutions. When the smoke cleared, 79 faculty and staff members had been formally indicted on organized crime charges. Their numbers are expected to climb substantially as the case unfolds.

They are the tip of the iceberg in one of Cosa Nuova's most daring projects --and a clue to its role in the Mafia Archipelago -- thanks to the unexpected consequences of an Italian government-funded reform that has, in effect, built an underworld M.I.T.

In the 1960s, very few Sicilians continued their studies beyond high school.

By the 1980s, after a costly expansion of the island's university system, a college degree was commonplace. One result was that unemployed young Sicilians, who historically emigrated north or abroad to factory jobs, were now too well- educated to consider such a move.

The second result was a growing supply of the trained technicians necessary to modernize the island's syndicates and oversee business affairs in the Mafia Archipelago, which are as far-flung and complex as those of Microsoft and General Motors.

But for an enterprise as ambitious as Cosa Nuova, a local pool of educated technicians was just a start. Intent on controlling the educational process itself, the Mafia launched what amounted to a takeover bid for the 37,000- student university -- a plan that was remarkably close to completion before police recognized what was happening.

Through the auspices of the 'Ndrangheta, a powerful ally of Cosa Nuova based across the Messina Strait in Calabria, dozens of professors and administrators were gradually bribed, threatened or blackmailed into drug trafficking, arms running and other underworld activities.

The majority were concentrated in the university's science and technology departments. Among their tasks, several arrested professors admitted, was to provide special assistance to picciotti, Sicilian dialect for "the boys," which refers to young operatives of the Mafia.

Just days before the University of Messina bust, authorities in Bologna and Palermo cracked the largest fraud scheme in Italian history.

The scheme, which used state-of-the-art computer systems to hack into the system of the Banco di Sicilia, came within a hair's breadth of transferring $1 billion in European Union development funds for Sicily to the overseas bank accounts of bogus companies.

It was an operation that completed the portrait of Cosa Nuova, police say, a composite sketch of an ancient institution made new through internal restructuring, globalization and solid investments in research and development --with a traditional nod to dynasty.

Among those arrested in the case were bankers, computer experts and telecommunications technicians with known ties to the Mafia, all of them under 48 years old. But the most interesting detail their raid turned up, according to prosecutors, was a filmed meeting of the fraud's chief planner and one of his "business associates."

The associate was Giuseppe Riina, 21, the fourth son of former Cosa Nostra boss Toto Riina.

No one can prove, as yet, that Cosa Nuova is at the operations pinnacle of the Mafia Archipelago, seeing to it that $30 billion worth of annual business is efficiently managed.

But the evidence is mounting, law enforcement authorities and criminologists say, that the talent and infrastructure in Sicily are up to the task, flourishing in the new soil turned by the nearly illiterate visionary known as Uncle Bernie the Tractor.

"Today, even the Mafia invests in the 'new economy,' " says Stefano Pitino, regional commandant of the Guardia di Finanza, Italy's tax police. "(The) Internet has provided Cosa Nostra with an extraordinary means of laundering earnings. Just a click on the computer and dirty money is diverted into stock holdings quoted on half the world's markets."

A NEW LEGACY

Throughout the Mafia heartland, "the hour of high technology has arrived," agrees Giovanni Impastato. "Cosa Nostra is much less interested in things like the pizzo" -- the monthly "protection fee" traditionally demanded from Sicilian merchants -- "than it is in the possibilities of computers."

A thin, intense teacher in his mid-40s, Impastato was born and still lives in the Mafia stronghold of Cinisi, where his father, Luigi, was a close associate of Tanu Badalamenti. Both Luigi and his oldest son, Giuseppe "Peppino" Impastato, who broke with the family in the late 1970s to found a radio station that openly reported organized crime operations, died in the mattanza.

The deaths left Giovanni bitter and willing to follow Peppino into Sicily's precarious anti-Mafia movement. He brought it an intimate knowledge of Cosa Nostra's inner workings and lifelong acquaintances with the 30- and 40- somethings who are now the Tractor's top lieutenants in Cosa Nuova.

The new Mafia, he says, "is infinitely more subtle than the old Mafia. What's been augmented from the past, from tradition, is omerta, the practice of silence."

He pauses, looking up as a group of high school students pass through the lobby of a suburban Palermo cinema where he has agreed to talk with a Chronicle reporter. "The fact that they don't kill judges or mayors anymore has led many people to believe that the organization itself is dead. That's a very dangerous conclusion, and you're looking at its consequences."

He gestures to the students, 300 of whom who have been bused here to view "One Hundred Steps," a film recounting the murder of Peppino Impastato.

During a discussion session that followed with Giovanni and other anti- Mafia activists, most of the students were visibly bored, and the theater was soon abuzz with their conversations with friends on cell phones.

"These kids think that it's history, an old story about my generation, not theirs," says another teacher, Marina Pellino. "But the most admired man in their own streets is a petty mafioso who sells them stolen motorcycles. The mentality that sustains the Mafia is still very much alive."

Before his death to cancer last year, the Cosa Nostra turncoat Tommaso Buscetta summed up his own insider's view of the final outcome in Italy's -- and the world's -- struggle with organized crime.

"The Mafia," he said flatly, "has won."

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