An East Hanover resident, who federal authorities say is one of the Gambino Crime Family's highest ranking members in New Jersey, was sentenced Friday to 11 years in prison for his role in multiple fraud schemes and an illegal gambling operation, U.S. Attorney Paul J. Fishman announced.
Andrew Merola, who is also known as Andrew Knapik and also lives in Toms River, had previously pleaded guilty to a federal racketeering conspiracy charge before U.S. District Judge Stanley R. Chesler, who imposed the sentence in Newark
"The record you have compiled to date is not anything anyone would be proud of,'' Chesler said while sentencing Merola.
According to documents and statements made in court:
Merola, 43, admitted that between February 2002 and March 2008, he was associated with other individuals in a criminal enterprise that operated principally in New Jersey and New York.
He also admitted that he conducted the affairs of the enterprise through a pattern of illegal activity that included the commission of racketeering acts, and that the purpose of the enterprise was to make money for its associates through participation in criminal activity.
Merola admitted to running an illegal gambling operation; the extortionate collection of payments due on extended credit; conspiracy to commit wire fraud involving a bar code scheme to defraud stores such as Lowe's Home Improvement, Home
Depot, Circuit City, Best Buy and Walmart; conspiracy to commit wire fraud involving a credit card and identity theft scheme; conspiracy to extort lunch truck vendors; conspiracy to commit wire fraud involving no show or low show jobs; and
receiving unlawful labor payments or bribes.
Merola had more than five gambling agents working for him in the illegal gambling operation. Bets on sporting events and casino-style games were placed over an Internet website that operated overseas and by telephone calls placed to a toll-free
Gambling agents who were delinquent in making their payments to Merola and his co-conspirators faced threats of violence to ensure collection of their gambling debts to the enterprise.
In the bar code scheme, Merola and his co-conspirators went to stores to find and record the bar code numbers of items with significantly lower prices than similar items in the same store. They then created a bar code label with the bar code
number of the lower priced item.
Later, Merola and his co-conspirators would return to the stores, place the fake bar code label over the original label on the more expensive merchandise, and then purchase the item at the reduced price. On various occasions, Merola and his co-conspirators would remove the phony bar code and return the merchandise for a refund or in-store credit based on the item's true price.
In addition to the prison term, Merola was sentenced to three years of supervised release and ordered to forfeit $100,000 and pay $161,481 in restitution.
To date, Chesler has sentenced 14 other defendants who were charged in the indictment to which Merola pleaded guilty, including the following Morris County residents:
<,Justin Cerrato, 31, of East Hanover, was sentenced Oct. 14, to 10 months of home confinement, two years of supervised
release and a $3,000 fine for his involvement in the illegal gambling operation.
‹‚Vincent Derogatis, 46, of East Hanover, was sentenced on Oct. 18, to six months of home confinement and two years of
supervised release for his involvement in the illegal gambling operation.
‹‚Jonathan Lanza, 27, of Florham Park, was sentenced Oct. 19, to 12 months of home confinement and three years of
supervised release for his involvement in the-2-conspiracy to embezzle from union benefit funds.
‹‚Christopher Doscher, 31, of East Hanover, was sentenced Oct. 21, to six months of home confinement, two years of
supervised release and a $2,000 fine for his involvement in the illegal gambling operation._
‹‚Anthony Marra, 27, of East Hanover, was sentenced Oct. 21 to six months of home confinement, two years of supervised
release and a $2,000 fine for his involvement in the illegal gambling operation.