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MCA Denies Ongoing Links to Organized Crime

November 21, 1989 GMT

UNIVERSAL CITY, Calif. (AP) _ Executives and attorneys of MCA Inc. said Monday that the latest news report linking the entertainment conglomerate to organized crime was one-sided and unfair.

Several MCA executives, most speaking not for attribution, said that Sunday’s ″60 Minutes″ report on relationships between MCA and reputed mobsters was biased and overlooked facts that would depict MCA in a more favorable light.

″The story left the unfortunate impression of ongoing associations with criminal elements,″ said Ronald Olson, an attorney retained by MCA. ″But in fact, there is no basis for those implications.″

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Olson said that MCA has been advised repeatedly by the government that it is not a target of a Department of Justice investigation.

The ″60 Minutes″ report focused on transactions between MCA Records and Salvatore Pisello, an alleged member of New York’s Gambino crime family, and MCA Home Video’s dealings with Eugene Giaquinto, who an FBI affidavit identifies as a ″close associate″ of organized crime figures.

The CBS news magazine report on MCA was seen in approximately 20 million homes, a network spokesman said Monday.

MCA consistently has denied any wrongdoing, saying that it didn’t know of Pisello’s alleged organized crime ties and that the company discharged Giaquinto last December after the FBI’s affidavits became public.

The company severed its ties with Pisello after his 1985 conviction for tax evasion, a charge related to his transactions with MCA.

MCA has been linked to a two-year investigation by the Department of Justice into the influence of organized crime in the entertainment business.

The entertainment giant owns Universal, one of the world’s largest motion- picture producers and distributors, in addition to a strong record label, a home video arm, a television production unit and theme parks.

Revenues for MCA in 1988 exceeded $3 billion.

Published reports in recent months and the ″60 Minutes″ story have said that MCA pressured the Department of Justice to fire attorney Marvin Rudnick, who claims he was close to exposing wider mob influence in Hollywood when he was investigating MCA for the government.

The Wall Street Journal said in a story on Nov. 14 that the federal investigation of organized crime in show business has been jeopardized due to the firing of Rudnick and the resignations of attorneys Richard Stavin and William Wagner.

The newspaper reported that Stavin and Wagner resigned over frustration over what they viewed as insufficient support and resources, as well as the inability to move ahead quickly on possible indictments.

Stavin said he is convinced ″senior organized-crime figures have infiltrated the motion-picture industry.″

The government strike force has had five chiefs in three years.

Olson said that Rudnick, featured prominently in the ″60 Minutes″ piece, failed to observe confidentiality rules and regulations of the Department of Justice.

The two most frequently mentioned names in stories on the investigation are those of Pisello and Giaquinto.

Pisello became involved with MCA Records in 1983 when the company began distributing albums for Sugar Hill Records, which retained Pisello. Pisello subsequently became involved in a failed deal with MCA over break-dancing mats and discounted, or ″cutout,″ records and tapes.

Some of Pisello’s dealings with MCA were marked by what the company admits were unusual bookkeeping procedures. Also, in the failed cutout deal, a record distributor was beaten up by a reputed member of New Jersey’s DeCavalcante Mafia family.

Giaquinto was dismissed recently as the president of MCA’s home entertainment unit. According to FBI affidavits and wiretaps, Giaquinto knew of wide-ranging mob involvement in the entertainment business. In one 1987 wiretap, Giaquinto was recorded as saying that four unspecified movies ″were all the same, laundered money.″

He has also been the target of an investigation for his role in directing millions of dollars in videocassette-box contracts to a printing company that authorities believe is linked to organized crime.