Going for broke
Duffy Conley parked in front of a red brick church in downtown Carnegie one January morning, but he wasn't there to pray.
The former kingpin of an illegal video poker empire in Pittsburgh was headed to his rented office at Citadel Financial, housed in the former First Baptist Church on Roberts Avenue.
State and federal investigators, however, beat him there. They were swarming over the office, confiscating computers and sports betting slips.
Conley's arrival gave them more. He was carrying papers detailing illegal video poker transactions and machine locations, and an address book with the names and numbers of bookmakers and ex-cons, including some connected to organized crime, state police said.
The evidence collected Jan. 18 and three months of wiretaps temporarily landed Conley, 43, in the Allegheny County Jail for violating the conditions of his supervised release from federal prison, where he served time for a previous gambling conviction.
On Wednesday, he'll be back in federal court in Pittsburgh as prosecutors try to send him back to prison for two years.
State and federal authorities continue to investigate a multimillion-dollar gambling ring involving what's left of Pittsburgh's LaRocca/Genovese organized crime clan -- considered the strongest of Pennsylvania's three Mafia families until several convictions in the 1990s and the aging of its most influential members helped precipitate its decline.
Conley -- whose gambling operations are linked to the mob -- is at the heart of the probe, investigators say.
"He spoke to every bookie we're aware of in Allegheny County," Paul Marraway, an agent with the state Attorney General's office, said during a Feb. 8 hearing in Pittsburgh before U.S. Magistrate Judge Francis X. Caiazza. "And many of these people are associated with organized crime."
Those include Christopher Paul Hankish, 43, the son of a notorious Wheeling, W.Va., crime boss; and fellow Citadel Financial employee Salvatore A. "Sonny" Williams, 49, whose father ran one of Pittsburgh's largest gambling empires. Both sons did time for their involvement in organized crime.
State investigators say Conley's recent gambling operation included contact with Ralph "Big Head" Maselli and John V. "Johnny A" Adams, both of whom have long ties to the Pittsburgh Mafia, according to reports for the now defunct Pennsylvania Crime Commission.
Investigators said they recorded Conley's telephone conversations for months, and intercepted numerous calls between Conley and the four men they say are associated with organized crime.
Marraway said the topic was always the same -- gambling. And the amount wagered was staggering. Conley moved more than $3 million in sports bets in one month last fall.
Conley's father laughed when asked about his son's involvement with mobsters.
"I don't know anything about organized crime," said John F. "Jack" Conley, of Robinson.
'Family' ties
Growing up in Robinson, John Francis "Duffy" Conley Jr. earned money cutting grass and scrubbing dishes at Del-Kid, a former McKees Rocks hamburger joint. He graduated from Montour High School.
"He was a good kid, hard-working," his father said.
Duffy Conley took business courses at a community college and went to work at Conley Motor Freight, a steel-hauling and trucking business started by his grandfather, T.C. Conley, and later owned by his father.
Then he opened two vending machine companies, Three Rivers Coin Co. and Duffy Vending.
Gambling long had been a money-maker for Pittsburgh mobsters. They dominated numbers betting, bookmaking and casino games in Western Pennsylvania, parts of eastern Ohio and West Virginia's northern panhandle.
Investigators suspected Conley had mob ties.
Federal investigators never proved Conley paid the Pittsburgh mob for protection, but the Pennsylvania Crime Commission claimed he received video poker machines from a company aligned with New Jersey's Lucchese and DeCavalcante organized crime families. His criminal record shows he later teamed up with mobsters in a bid to take over an Indian casino in California.
"We always saw him as an 'associate' of organized crime," said a former crime commission official, who asked not to be named.
The illegal video poker business was booming, and the mob couldn't control it all. There were too many people to police.
Conley got into the video poker business in 1984, court documents state. By 1990, at age 27, he was one of the most prolific video poker machine vendors in Western Pennsylvania, according to the crime commission.
By then, charges had started to mount.
In 1989, an Allegheny County grand jury recommended prosecuting Conley and his No. 2 man, William Curtin, now 50, of Heidelberg, on charges of operating a corrupt organization and gambling conspiracy. The charges were dismissed when Common Pleas Judge Paul F. Lutty Jr. ruled 101 search warrants used to raid bars and clubs in and around Pittsburgh were faulty. Curtin was recorded on a 1989 FBI wiretap bragging about the 4,000-plus video poker machines in their empire.
Feds catch up
A two-year federal investigation ended in 1991 with the indictment of Conley and 22 others for conspiring to run a gambling business, money laundering and interstate transportation of gambling devices.
Conley was called the "central figure in the extensive illegal gambling operation" in court papers.
His poker machines were housed in more than 100 locations throughout Allegheny County, including American Legion Post No. 82 in Carnegie, the Idlewood Inn in Green Tree and Terry's Snack Shop in McKees Rocks, court records show.
By the time Conley headed to trial in 1995, he was alone. The rest of those charged, including his father, had pleaded guilty.
"It was a matter of the legality of it," Conley's father said, "and (investigators) thought it was illegal."
Duffy Conley always disagreed and never seemed to believe what he was doing was wrong, investigators said.
Months before going to prison in 1995, Conley joined cash-strapped mobsters tied to the Pittsburgh mafia in a plan to take over the Rincon River Oaks Casino near San Diego.
Then 31, Conley was running a $15-million-a-year gambling enterprise, investigators said.
He agreed to back the Columbia Group, a bogus investment consortium designed to keep federal Indian gaming regulators from learning of the criminal records and reputed mob ties of those behind the scheme. Conley pumped nearly $2 million into the deal between December 1994 and August 1995, court records show. He secured hundreds of video poker machines for the operation.
The casino opened for one day in June 1995 before authorities shut it down because Columbia Group wasn't registered with the federal government.
By the time a federal grand jury indicted the group in 1997, Conley was two years into a nine-year stint at the federal prison in Loretto, Cambria County.
He was released Jan. 30, 2004.
Back in the game
State authorities began investigating Conley again in February 2005, after state Attorney General Tom Corbett's office received a letter saying he was back in business.
Wiretaps placed on three cell phones from Nov. 14 through Jan. 18 revealed Conley was taking bets on professional and college football and basketball games, Marraway said. His ring involved local bookies, state investigators said, as well as others across the country and some around the world.
Smart bookies want equal bets on both sides of a game, profiting through the "juice" -- typically 10 percent of a losing bet. When books aren't even, bookies try to "lay off" bets with other bookmakers or casinos.
Investigators said Conley laid off and accepted bets from other bookies. He couldn't have been placing personal wagers because of the volume of calls and amount of money bet, as well as collected, they said.
"It was constant," Marraway said in court. "He'd get on the phone and continue betting for hours."
Surveillance showed Conley dealt with people involved in his prior video poker ring and other criminals, Marraway said.
Over 28 days in November and December, Conley laid off $1.7 million in bets to a person in Georgia called "Brick," $1.2 million to offshore casinos and between $500,000 and $1 million to local bookies, Marraway said.
For some offshore wagers, Conley used XtremeWagers.com, a Costa Rican gambling business, Marraway said.
The investigation also revealed local bookies used another offshore casino -- BetCRIS, or Costa Rica International Sports. Investigators said Conley was working with Michael "Mickey" Flynn Jr., owner of the Union Grill in downtown Washington, Pa. Flynn's son, Michael Flynn III, lives in Costa Rica part-time and works for BetCRIS, Pennsylvania Trooper Anthony Cornetta said during Flynn's Feb. 9 arraignment before Caiazza.
Inside the new operation
Cornetta and other undercover state investigators infiltrated Conley's operation at Citadel Financial by posing as bookies looking to get into the offshore casino action.
Conley said he worked at the Carnegie business as a mortgage broker, but authorities said there was no indication he worked in the home loan business.
"That's a farce," Assistant U.S. Attorney Brendan Conway told Caiazza. "He's not involved in mortgage lending. He's involved in gambling activities."
When investigators raided Citadel Financial on Jan. 18, they also searched nine other places in Allegheny and Washington counties connected to Conley's gambling ring, including the South Side house Conley shared with Stephanie Cupka, his longtime girlfriend, and their 10-year-old son.
Investigators arrived at Citadel about 9 a.m. Conley pulled up a half-hour later, armed with more evidence state investigators plan to use against him -- a detailed report of video poker machine locations, bookkeeping information and an address book with contact information for bookies and convicted felons as well as six pages of offshore account numbers Conley controlled, Marraway said.
That Conley is accused of being back in the gambling business didn't surprise some investigators.
Unlike many others who operate illegal gambling enterprises, attention didn't seem to bother Conley, they said, noting his attitude was, "Here's what I'm doing, now come do something about it."
