The trial of three men accused of trying to hide a reputed Mafia associate’s financial interest in land being targeted for an Everett casino is set to begin Monday with jury selection, in the first trial related to the state’s fledgling casino industry.
Charles A. Lightbody, a reputed associate of La Cosa Nostra, and partners Dustin DeNunzio and Anthony Gattineri face up to 20 years in prison on fraud charges.
They are accused of hiding the fact that Lightbody, a convicted felon, had been part owner of the land later purchased for the Wynn Resorts casino. Lightbody allegedly had a 12 percent interest in FBT Everett Realty, the land owner.
The defendants are accused of fabricating and backdating documents to make it appear as if Lightbody had sold his interest in FBT Everett several months before Wynn signed an option to buy the land.
Prosecutors say state law prevented convicted felons from having any financial benefit from a casino, the alleged motive for concealing Lightbody’s interest.
The defendants’ lawyers have denied that they did anything wrong, and also argue that prosecutors have misinterpreted state law. They argue that Lightbody could have sold the land to Wynn under state law, and so he did not commit fraud.
Lawyers in the case said last week that the trial could last as long as four weeks, and prosecutors have identified dozens of potential witnesses — including Steve Wynn, the casino mogul from Las Vegas.
The case is the first of its kind to go to trial since the passage of the 2011 Massachusetts Expanded Gaming Act, which allowed for up to three casino licenses in the state.
Wynn was competing for the Boston region’s sole license and signed an option on the Everett land for $75million. He then began to pay FBT Everett $100,000 a month to preserve his interest to buy the property.
The FBI learned of Lightbody’s alleged interest in FBT Everett after he talked about it with reputed Mafia member Darin Bufalino, while visiting Bufalino in prison. Bufalino is serving a seven-year prison sentence for extortion.
The Massachusetts Gaming Commission then also questioned Lightbody’s interest in the property. Wynn later signed a renegotiated option for the land at a sale price of $35 million, but casino critics said the controversy forever tainted the process.
Prosecutors said in court recently that Wynn would not have won the license if Lightbody still had any ownership in the property, and the Gaming Commission found that FBT had deceived Wynn, that he did not know of Lightbody’s interest.
Wynn still won the region’s sole casino license. Wynn and the Massachusetts Gaming Commission are considered to be victims of the fraud, according to the federal indictment.
Prosecutors alleged that DeNunzio, a real estate developer educated at Harvard and MIT, worked closely with Lightbody to hide the ownership. They allegedly had Lightbody sign a document in July 2013 fraudulently claiming he had sold his interest to Gattineri more than a year earlier, in August 2012.
If the three men are convicted of the federal charges, they could lose the money from the sale of the property in addition to facing prison.
The defendants won several legal victories last week as US District Judge Nathaniel Gorton outlined evidence that can be introduced at trial.
Prosecutors will be prohibited, for instance, from saying that Lightbody was an associate of the Mafia, though they can cite his criminal history.
Also, prosecutors cannot say Bufalino was a soldier with the Mafia, though they can tell jurors he was involved in organized crime.
Moreover, prosecutors cannot use the phrase strip club to describe the King Arthur’s business in Chelsea that Lightbody had allegedly attempted to take over under questionable circumstances in 2013, after defense attorneys argued it could create an unseemly image of the business that would prejudice jurors.
However, Gorton agreed that prosecutors can refer to King Arthur’s as an “adult entertainment” club.