Robert Panozzo, Reputed Chicago Outfit Mob Soldier, Pleads Guilty to Extortion Conspiracy

Reputed Chicago Outfit Mob soldier Robert Panozzo pleaded guilty Wednesday to threatening and beating a suburban businessman he claimed owed him $100,000 and then hiring a goon to torch the debtor’s car and house when he wouldn’t pay.

“This is serious. I want my money,” Robert Panozzo Sr. allegedly told the victim in 2005 before embarking on a four-year effort to collect the juice-loan debt.

Panozzo, a reputed member of the Outfit’s Grand Avenue crew, entered his guilty plea to one count of extortion conspiracy in the federal courthouse in Rockford. His plea agreement calls for up to 14 years in prison, but Panozzo’s attorneys have disputed prosecutors’ calculation of the sentencing guidelines and are free to ask U.S. District Judge Philip Reinhard for a lesser sentence.

Whatever time Panozzo receives in the extortion case will be served concurrently with his 18-year prison term handed down earlier this year for his conviction in a sweeping racketeering conspiracy brought in Cook County court.

In that case, Panozzo and longtime associate Paul Koroluk admitted to heading a crew that participated in wide-ranging crimes, including home invasions, armed robberies, burglaries, insurance fraud and prostitution. Panozzo, Koroluk and several other members of the crew were arrested in 2014 during the attempted robbery of a drug stash house on Chicago’s Southeast Side. That turned out to be a law enforcement ruse, however.

Panozzo was a longtime soldier for Albert “Little Guy” Vena, the reputed Grand Avenue boss, according to prosecution testimony at a mob-related trial in 2014.

Panozzo’s 17-page plea agreement entered Wednesday does not call on him to cooperate in any other investigations.

According to the document, Panozzo loaned the McHenry County businessman — identified only as Victim 1 — $40,000 in 2005 and then followed up with “additional loans.”

At a meeting at a restaurant in Palatine in 2006, the businessman handed Panozzo an envelope with $25,000 in cash, according to the agreement. He believed that was his final payment, but Panozzo let him know he still owed $100,000 in interest on the loans.

That October, after the victim had not paid, Panozzo and his associate, Joseph Abbott, confronted the businessman at work and beat him, causing “injuries and contusions to Victim 1′s head,” the plea agreement said.

Panozzo was later sentenced to prison for a burglary conviction and couldn’t collect on the debt. Once he was released in 2008, though, Panozzo began calling Victim 1 demanding repayment, the plea agreement said.

In February 2009, Panozzo paid Abbott $1,000 to set fire to a Dodge Caravan that was parked in the victim’s driveway, according to the agreement. Two months later, Abbott “used an incendiary device” to set fire to the victim’s garage and several nearby trash cans, the plea said. Panozzo acknowledged in the plea agreement that he paid Abbott about $4,000 or $5,000 to “blow up” the victim’s residence.

Abbott has pleaded guilty to extortion and is awaiting sentencing, court records show.

Raised in the old Italian American enclave known as “the Patch” on the Near West Side, Panozzo and Koroluk have criminal histories that stretch back decades, court records show.

In 2006 they were both sentenced to seven years in prison for a string of burglaries targeting tony north suburban homes that netted millions of dollars in jewelry and other luxury items. Police at the time described the burglars as some of the most sophisticated they’d ever seen, from disabling state-of-the-art alarm systems to cutting phone lines.

Panozzo and Koroluk were arrested in a dramatic sting in 2014 after the two posed as cops to rob what they thought was a cartel stash house on the Southeast Side. They kicked in the door and grabbed stacks of drugs — only to be arrested by Chicago police and federal agents who had wired the house for audio and video surveillance and watched from above with an FBI spy plane. Koroluk wore a police star dangling from his neck, authorities said.

Prosecutors allege the crew participated in several other elaborate schemes targeting drug dealers, many of which involved tracking their targets with GPS to find where they stashed their narcotics.

Koroluk was also sentenced to 18 years in prison.

Thanks to Jason Meisner.

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