Asbestos Racketeers Get Record Prison Time

SYRACUSE, New York, January 3, 2005 (ENS) - A father and son who pulled the nation's largest asbestos cleanup scam have been sentenced to the longest terms of imprisonment in U.S. history for a federal environmental crime.

Alex Salvagno, 39, of Loudon, New York, and his father, Raul Salvagno, 71, of Ormond Beach, Florida, were sentenced December 23, 2004 in U.S. District Court in Syracuse to 25 years and 19 years of imprisonment, respectively.

The Salvagnos were convicted of crimes related to hundreds of illegal asbestos removal activities throughout New York state. The faulty removals endangered workers and left high levels of asbestos at churches, banks, cafeterias, military housing, elementary schools, a children's museum, and private residences.

As part of the sentencing, Alex Salvagno was ordered to forfeit $2 million to the U.S. government and to pay restitution to their victims in the amount of $23 million.

Raul Salvagno was ordered to forfeit $1.7 million to the U.S. government and to pay restitution to their victims in the amount of $22.8 million.

The Salvagnos operated one of the largest asbestos abatement companies in New York Stat under the name of AAR Contractor, Inc. (AAR). The company was ordered to forfeit $2 million to the U.S. government and to pay restitution to their victims in the amount of $22.8 million upon convictions for similar crimes.


Microscopic image of crysotile asbestos, the most common form of this group of mineral silicates. The sharp particles of asbestos can become embedded in lung tissue. (Photo courtesy New York State Department of Environmental Conservation)
The defendants were convicted of conspiracy to violate the Racketeer Influenced and Corrupt Organization Act (RICO) conspiracy to violate the Clean Air Act and the Toxic Substances Control Act; and violations of the Clean Air Act.

Additionally, Alex Salvagno was charged with three tax fraud counts, all related to a 10 year illegal asbestos removal scheme. The jury concluded that as part of the RICO charge, the defendants committed multiple acts of obstruction of justice, money laundering, mail fraud, and bid rigging.

The evidence put forward at trial established that, for 10 years, from 1990 until 1999, Alex Salvagno secretly and illegally co-owned a purportedly independent laboratory, Analytical Laboratories of Albany, Inc., (ALA). The Salvagnos used ALA to defraud victims by creating fake laboratory analysis results which they used to convince clients that all asbestos had been properly removed as promised by the defendants.

Illegal collusion between AAR and ALA occurred at more than 1,555 facilities throughout New York state, and many of these projects also involved improper abatement.

Falsification of up to 75,000 laboratory samples covered up this improper asbestos abatement including at elementary schools, churches, hospitals, State Police barracks, the New York Legislative Office Building, and other public buildings and private residences.

Witnesses, including former AAR and ALA employees, testified to "rip and run" activities directed by the defendants that included indoor "snow storms," an euphemism for the release of large amounts of visible asbestos into the air during the removal process.

Evidence showed that workers were knowingly sent into asbestos "hot zones" while being encouraged to work illegally without respirators, or without sufficient replacement filters for the respirators.

"The trial leading to today's sentences exposed an extraordinary number of serious crimes that endangered many," said Thomas Sansonetti, assistant attorney general for the Justice Department's Environment and Natural Resources Division.

In imposing the lengthy terms of incarceration, U.S. District Court Judge Howard Munson made the specific finding that the Salvagnos' crimes resulted in the substantial likelihood of death and serious bodily injury to numerous individuals.

Nationally renowned experts testified for the United States at a sentencing hearing that most of the 100 worst exposed former AAR workers are almost certain to contract asbestosis, lung cancers and mesothelioma, an invariably deadly form of cancer.


Workers, wearing proper protective gear, remove a section of asbestos insulation from piping. (Photo courtesy DOE)
The criminal conspiracy involved as many as 500 AAR and Analytical Laboratories workers, who also are at risk. More than a dozen top AAR and Analytical supervisors have pled guilty and remain to be sentenced.

Federal agents returned to numerous facilities where AAR had performed purportedly complete asbestos abatement and where ALA had produced passing final air clearance results. The agents found high levels of asbestos remaining at numerous locations. Notification by the United States Attorney's Offices to all known victims resulted in additional places of contamination being found.

Judge Munson said he would allow the Salvagnos to stay with their families until February 8, when they must report to prison.

Asbestos is known to cause various forms of cancer and asbestosis, a lung disease that is nearly always fatal. The Environmental Protection Agency has determined that there is no safe level of exposure to asbestos.

The investigation which resulted in this prosecution was conducted by the U.S. Environmental Protection Agency, the Internal Revenue Service, the United States Army Criminal Investigation Division, the New York State Office of Inspector General, and the New York State Departments of Labor and Health. The matter was prosecuted by Assistant United States Attorney Craig Benedict.

Glenn Suddaby, U.S. Attorney for the Northern District of New York said his office considers the investigation and prosecution of environmental crimes to be "a high priority."

"This investigation and prosecution is a tribute to the outstanding results that can be achieved by the collaborative effort of the law enforcement agencies that worked together so well in this case," Suddaby said.