Operators Of "escort Services" Indicted

Attorney General Spitzer said today that 18 people associated with popular "escort services" operating in New York City, Long Island, Westchester and New Jersey have been indicted for promoting prostitution and related charges.

The indictments by a Staten Island Grand Jury follow a lengthy investigation of the escort services, which authorities believed were really a front for a massive prostitution ring.

"This was a sophisticated and lucrative operation with a multi-tiered management structure," Spitzer said. "It was, however, nothing more than a prostitution ring, and now its owners and operators will be held accountable."

New York City Police Commissioner Raymond W. Kelly said: "These individuals thought they could hide in plain sight by pretending to provide legitimate and legal services without their true practices being discovered. The only escort they are getting now is a police escort."

In the first indictment, 16 defendants were charged with enterprise corruption, money laundering, promoting prostitution and falsifying business records. In the second indictment, two individuals were charged with helping to launder proceeds from the illegal activities.

The charges are the result of an investigation conducted jointly by the Attorney General's Statewide Organized Crime Task Force (OCTF), the New York City Police Department, the Waterfront Commission of New York Harbor, the United States Department of Labor and Federal Bureau of Investigation. In addition, the Richmond County District Attorney's Office was instrumental in launching the investigation.

The escort services, which advertised under various names, including Personal Touch, Day Dreams, Sweet, Gentlemen's Delight, White Diamonds, Ladies and Britney's, allegedly accepted payment for the prostitution services in cash or, in some cases, by credit card. The credit card transactions were processed through different merchant accounts, each of which claimed to provide legitimate services to its customers.

The business allegedly operated 24 hours a day, seven days a week, with a staff of approximately eight office managers who supervised and directed the activities of approximately 15 to 20 drivers and 30 to 40 prostitutes each day. The drivers and prostitutes were dispatched to all five boroughs of New York City, to Nassau, Suffolk and Westchester counties, and into suburban New Jersey, from business offices in Staten Island, Brooklyn and Queens.

As charged in the first indictment, defendant Frank Farella was the owner and boss of the illegal business. Defendants John Pioppo and Mario Galbo were the upper-level managers responsible for the day-to-day operation of the criminal enterprise. In this capacity, Pioppo and Galbo supervised the office managers, including defendants Joann Corey, Mildred Scarpa, Angela Altman, April Beiner, Dorothy Bray, Lillian Demalteris, Cynthia Dimele, Debra Gutierrez, Karen Kelly, Cynthia Raiser, Louise Santanastasio, Teresa Vera and Melissa Giandinoto.

The following defendants were charged with Enterprise Corruption, a class B felony which carries a possible penalty of up to 8 1/3 to 25 years, and several counts of Promoting Prostitution in the Third Degree, a class D felony:

Frank Farella, 44, of Staten Island
John Pioppo, 42, of Staten Island
Mario Galbo, 58, of Brooklyn
Joann Corey, 29, of Staten Island
Mildred Scarpa, 61, of Brooklyn
Angela Altman, 26, of Brooklyn
April Beiner, 52, of Brooklyn
Dorothy Bray, 50, of Staten Island
Lillian Demalteris, 43, of Brooklyn
Cynthia Dimele, 20, of Staten Island
Debra Gutierrez, 38, of Brooklyn
Karen Kelly, 39, of Brooklyn
Cynthia Raiser, 27, of Queens
Louise Santanastasio, 35, of Staten Island
Teresa Vera, 21 ,of Staten Island
Melissa Giandinoto, 27, of Brooklyn

Farella and Pioppo also were charged with falsifying business records and money laundering.

In two separate but related indictments, Lester Thompson, 46, of Coram, Long Island, was charged with falsifying business records, and Norman Greenblatt, 67, of Staten Island, was charged with promoting prostitution, falsifying business records and money laundering. The indictments charge that Farella, Pioppo and Greenblatt falsified applications to open merchant accounts for processing credit card transactions, which applications hid the true nature of the business. Through these merchant accounts it is alleged that the business laundered millions of dollars from January 1998 through March 2004.

The investigation was led by OCTF's Supervising Investigator Diego Cruz under the direction of Chief Investigator Thomas Mullen. The matter was presented to the grand jury and will be handled at trial by Assistant Deputy Attorney General Amy Cohn, under the direction of Christopher Prather, Deputy Attorney General in charge of the OCTF.

The charges contained in these Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.