Steven Mandell Gets Life in Prison for Sadistic and Depraved Plot to Kidnap, Extort, and Kill Victim in North Side Torture Chamber

A northwest suburban man was sentenced to life in prison for plotting in 2012 to kidnap, torture, extort and murder an innocent victim and then take control of the victim’s real estate holdings. STEVEN MANDELL, 64, formerly known as “Steven Manning,” of Buffalo Grove, was tried in February of this year and convicted of conspiracy to commit kidnapping, extortion conspiracy, attempted extortion, possessing a firearm during a violent crime, being a felon-in-possession of a firearm, and obstruction of justice.

“This was an extremely serious and disturbing offense,” U.S. District Judge Amy J. St. Eve said in imposing the life term following a hearing in Federal Court. “Your actions in this case, Mr. Mandell, were evil . . . and showed a complete disregard for human life.”

The judge also imposed a mandatory consecutive five-year sentence for use of a firearm and a $5,000 fine. Mandell has been in custody since he was arrested in October 2012 and there is no parole in the federal prison system.

“Mr. Mandell was the mastermind of a truly barbaric crime,” Assistant U.S. Attorney Amerjeet Bhachu said in court. Mandell “was the principal author of an exceptionally sadistic and depraved plan to kidnap, torture, extort and murder,” Mr. Bhachu and Assistant U.S. Attorney Diane MacArthur argued in a sentencing memo.

Mandell, a Chicago police officer for approximately 10 years until 1983, served more than a decade on Illinois’ death-row for a murder conviction that was later overturned on legal grounds involving the admissibility of evidence at his trial, not because of innocence.

A co-defendant in the 2012 murder plot, Gary Engel, who was 61 at the time, of Homer Glen and a former police officer in Willow Springs, committed suicide shortly after he was arrested with Mandell.

The evidence at trial showed that Mandell rented a location in the 5300 block of West Devon Avenue, known to him as “Club Med,” not knowing at the time that the FBI had installed a hidden camera and recording equipment after a cooperating witness reported Mandell’s plan. Mandell and Engel outfitted the rental location to restrain, torture and kill the victim. They developed a plan to lure him from his residence; stocked “Club Med” with all the tools they needed to carry out the crimes; and obtained all the trappings they needed to pose as police officers in connection with the victim’s abduction.

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Steven Mandell Sentenced to Life in Prison for Murder Plot

After decades of drama in Chicago, including a murder conviction, death sentence, shocking exoneration and landmark lawsuit against the FBI, all Steven Mandell says he wanted to do was quietly live out his golden years in Florida. "I was happily retired, living with my lovely wife in a golf course community in Naples," Mandell, 64, said Thursday as he delivered bizarre remarks at his sentencing in a packed federal courtroom. "It was the perfect life."

Instead,he came out of retirement in 2012 and returned to Chicago, where he was soon arrested in a grisly plot to kidnap, murder and dismember a suburban businessman. Mandell said he was once again framed by an untrustworthy informant, continuing his "long FBI nightmare." But U.S. District Judge Amy St. Eve was unmoved by the melodrama. Moments after the former Chicago cop wrapped up more than 30 minutes of mostly rambling remarks — including cheerfully wishing the judge a merry Christmas — St. Eve sentenced him to life in prison for kidnapping and extortion conspiracy and added a mandatory five-year sentence for a gun conviction.

It was an emphatic end for Mandell, a reputed underworld figure whom law enforcement has long considered a dangerous killer and elusive target.

Years ago Mandell — who then went by the name Steven Manning — was sent to death row for the drug-related 1990 slaying of a trucking firm owner. After his murder conviction was overturned on appeal, he won a landmark $6.5 million verdict in a lawsuit against the FBI. A judge, however, later threw out the verdict, and Mandell never collected a penny.

Mandell moved to Florida after the ruling and vanished from the public eye. Several years later, he came back to Chicago under his new name and soon was meeting with reputed mobsters at La Scarola restaurant on Grand Avenue, according to court records.

The latest case against Mandell unfolded in October 2012 when he and his accomplice, Gary Engel, were arrested outside the Northwest Side office of George Michael, a former banker and real estate mogul who pretended to go along with the macabre plan to kidnap Riverside businessman Stephen Campbell and extort him for his cash and property.

Michael had helped Mandell outfit a Devon Avenue storefront with an industrial sink, butcher table and other equipment needed to drain Campbell's body of blood and chop it to pieces. But Michael was wearing a wire for the feds, and the storefront — which Mandell dubbed "Club Med" — was rigged with a hidden FBI camera.

Engel hanged himself in his jail cell shortly after he and Mandell were arrested, authorities said.

In the videos played at Mandell's February trial, he laughed when he described how victims often come unglued before their deaths. He mimed a blindfolded prisoner, then drew a hand across his throat to signify a killing. He seemed to have mirth in his eyes as he made moaning sounds describing the carnage he could inflict.

"Uhhhh please ... aaaaaaahhhh! It's pitiful," Mandell said in one recording.

Mandell's attorney, Francis Lipuma, sought as few as 12 years in prison, saying Mandell should get credit for the two decades he spent behind bars for a murder he didn't commit. Lipuma noted that no one was actually harmed in the kidnapping plot and said if Mandell were released in his 80s, he'd be at a point in his life "when criminal activity would have concluded." But in asking for a life sentence, Assistant U.S. Attorney Amarjeet Bhachu painted Mandell as a sadistic narcissist who "actually takes pleasure from hurting people." "He likes it. It arouses him!" said Bhachu, pointing to the defense table at Mandell, who took a sip of water from a Styrofoam cup.

In her ruling, St. Eve said Mandell's actions showed a "complete disregard for human life." "The pure delight that you showed in those videos … it came through loud and clear," St. Eve said. "The glee in your face was very apparent. It was, quite frankly, chilling."

St. Eve said a life sentence was necessary to keep Mandell from returning to a life of violence and crime.

When FBI agents raided Mandell's Buffalo Grove home after his arrest, they found more than $16,000 in cash in two separate stashes as well as thousands of dollars more in a safe-deposit box at a nearby bank, recent court filings show. Mandell has asked for the money to be returned to his 83-year-old wife, but prosecutors have objected in sealed filings.

Thanks to Jason Meisner.

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Reputed Chicago Mob Outfit Crew Charged with Posing as Police to Rob Drug Houses

Members of a street crew with ties to Chicago’s Outfit that operated a sophisticated drug ring that posed as police officers to rob cartel stash houses of large amounts of drugs were arrested this week, prosecutors said Saturday.

Four men who were part of the Panozzo-Koroluk Street Crew were arrested Thursday after investigators set up a sting operation in Chicago’s Hegewisch neighborhood, prosecutors said in Cook County Bond Court Saturday. The men tried to steal 44 kilograms of “a substance containing cocaine,” from what they thought was a drug dealer’s stash house in the 13000 block of South Brandon Avenue, prosecutors said.

Police had installed surveillance equipment in the house, however, and the crew was arrested as they brought the cocaine outside.

Robert Panozzo, 54, Paul Koroluk, 55, and Maher Abuhabsah, 33, and Panozzo’s 22-year-old son, Robert Panozzo, Jr., were held without bail in Cook County bond court Saturday.

Panozzo and Koroluk are part of a Grand Avenue Outfit crew run by Albert “Little Guy” Vena, according to sources and court testimony in the federal murder plot trial of Steve Mandell, a former Chicago police officer, earlier this year. The crew came to investigators’ attention in October 2013, when law enforcement found evidence that Panozzo Sr. tried to have a witness in a home invasion and kidnapping case murdered to prevent the witness from testifying at trial, prosecutors said.

Koroluk’s wife, Maria Koroluk, 53, was arrested Friday at the home she shared with her husband in West Town, where police found 200 grams of cocaine on her clothes and shoes, Morley said. She was charged with possession of a controlled substance with the intent to deliver and held on $100,000 bail.

The men’s crimes included home invasions, armed robberies, burglaries, insurance fraud and prostitution, Cook County State’s Attorney Anita Alvarez said at a news conference after the crew’s bond hearings.

The crew conducted five  to six major drug-house “rips” per year, during which they posed as police officers to rob stash houses, Alvarez said. The crew used sophisticated methods, including attaching GPS trackers to dealers’ cars to find where they stashed their drugs.

 “I think this is a very organized crew and a dangerous crew,” Alvarez said. “They have a  history of burglarizing and being in and out of jail. Clearly it didn’t help. We are hoping under these charges they will be held accountable.”

This is the second case charged under the State of Illinois’ Rico law that allows prosecutors to target the structure of a criminal organization itself so that a judge can see a complete picture of a gang’s criminal activity, Alvarez said. “This is the perfect example of the type of cases we were looking to be able to handle under this new law,” Alvarez said.

During numerous search warrants into the mens’ homes executed as late as last night, Alvarez said, officers found police scanners, police vests, and real police badges that had been stolen from police officers’ homes. “They have a long history, a history of burglaries and home invasions,” Alvarez said. “We are happy that this operation turned out the way it (did).”

During a home invasion in 2013, Panozzo Sr. sliced off the ear of a victim after he heard the man speaking English after he had claimed that he only spoke Spanish. “Needless to say their methods involved extreme violence,” Alvarez said.

Panozzo and Koroluk have several burglary convictions and operated one of the most sophisticated burglary rings police have ever seen. Panozzo and Koroluk operated in the area of Grand and Western, Alvarez said. They are from the old Italian neighborhood known as the Patch on the near West side, where Joey the Clown Lombardo and many other mobsters are from.

The two are also part of the same crew as Louis Capuzi and Frank Obrochta, who are in jail facing burglary charges in both DuPage and Cook Counties.

The male defendants face 15 to 60 years in prison for racketeering as well as 15 to 60 years for drug conspiracy charges. Maria Koroluk faces up to 40 years in prison, Alvarez said.

Thanks to Meredith Rodriguez.

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Federal Judge Not Interested in Being Pen Pals with Steven Mandell

Former death row inmate Steven Mandell may have been convicted of plotting to torture, murder and dismember a suburban businessman, but he wants the federal judge who oversaw his sensational trial to know he wouldn’t hurt a fly.

In an April 4 letter written from his jail cell and made public this week, Mandell claimed the only time he’d ever been remotely violent in his life was in an altercation with his girlfriend on Christmas Day in 1983 and that the domestic abuse charges were later dropped.

Mandell said in the three-page letter to U.S. District Judge Amy St. Eve that prosecutors have conjured up a false picture of him as a dangerous threat to keep him in solitary confinement at the Metropolitan Correctional Center, the federal Loop jail.

“I have never ever bothered anyone in my entire life. No one! Not a soul!” Mandell, a Chicago police officer decades ago, wrote in neat cursive. “There is NO danger. There NEVER was a danger.”

In a court hearing last week, St. Eve called the letter inappropriate and revealed that since his conviction in February Mandell had sent several other letters, including one to the Highland Park police. While details of that letter weren’t discussed, Highland Park was the site of a spectacular 2012 fire that killed restaurateur Giacomo Ruggirello. The blaze was labeled a possible arson, and last year Mandell’s lawyers mysteriously subpoenaed records about the investigation.

Mandell also sent a letter to U.S. District Judge Milton Shadur, who is presiding over a pending lawsuit alleging the FBI framed Mandell’s alleged partner, Gary Engel, in a 1984 kidnapping in Missouri.

Assistant U.S. Attorney Amarjeet Bhachu has told St. Eve that some of the materials sent by Mandell in the letters violated her protective order sealing certain information in the case. Bhachu said that if Mandell continued to send such materials he could face charges.

Last month, Mandell’s attorneys alleged in a court filing that he was simply expressing his “deeply held conviction” that the key informant in his case, Northwest Side real estate mogul George Michael, was involved in criminal activities that should be investigated.

Mandell claimed in the filing that prosecutors used his letters to justify returning him to the jail’s Special Housing Unit, where he is on 24-hour lockdown and has restricted access to email and other communications.

He was first placed in solitary confinement last fall after prosecutors alleged he tried to arrange Michael’s murder while in the jail’s general population. But prosecutors have denied any involvement in Mandell’s current placement in the jail.

Mandell, 63, was convicted Feb 21 on charges he plotted to kidnap, torture, kill and dismember Riverside landlord Steven Campbell. The jury acquitted him of a separate plot to kill an associate of a reputedly mob-connected strip club. Mandell faces up to life in prison.

Michael secretly wore a wire for the feds and pretended to go along with the plan to outfit a Devon Avenue storefront with an industrial sink, butcher table and other equipment needed to drain Campbell’s body of blood and chop it to pieces.

Years ago Mandell – who then went by the name Steven Manning -- had been sent to death row for the drug-related 1990 slaying of a trucking firm owner. After his murder conviction was overturned on appeal, he won a landmark $6.5 million verdict in his suit against the FBI. A judge, however, later threw out the verdict, and Mandell never collected a penny.

Thanks to Jason Meisner.

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Did Ex Chicago Cop, Steven Mandell, Plan Assassinations to Take Over Strip Club?

The former cop and death row inmate was callous and calculated, quoting military tactics as he considered which of two targets it made the most sense to kill in order to take over their chunk of a lucrative strip club, federal authorities allege.

"You chop the snake's head off. Pow," Steven Mandell allegedly told an undercover informant in September 2012 as a hidden video recorder rolled. "I still don't think you have a clear path on how it plays out, but at least we'd be on our way, wouldn't we?"

In the end, Mandell decided to kill the more vulnerable of the two — and his wife if necessary — then place a threatening phone call to the second target's wife to convince him to walk away, according to transcripts of the secret recordings filed recently in federal court. And in case anyone thought the Chicago Outfit's infamous Elmwood Park crew didn't have muscle anymore, Mandell had a special message.

"Tell that (expletive) husband to leave this situation alone, or else," Mandell said he would tell the wife, according to the government filing. "'Cause I'll show you what Elmwood Park really looks like. I can get really nasty."

On the FBI video, Mandell then drew a hand across this throat and made a "slitting sound," the filing said.

The chilling new details have emerged a month before Mandell, 63, is set to go on trial in U.S. District Court in connection with a series of alleged plots, including a gruesome scheme to kidnap and extort a local businessman, then kill him and dismember the body.

Now, through details provided in the court record, the Tribune has confirmed that the strip club associate Mandell had allegedly planned to kill, identified in the government filing only as "Victim 2," was Anthony Quaranta, a former Franklin Park cop known as "Tony Q." He also allegedly targeted Quaranta's associate, Demitri Stavropoulos, a highly paid "consultant" at the Polekatz strip club in suburban Bridgeview who was identified in the court record only as "Associate 1."

The court document also paints a more detailed picture of just how reckless and daring Mandell — formerly known as Steven Manning — had allegedly become before his sensational arrest in October 2012.

According to the government filing, for several weeks that fall, Mandell and his alleged associate, Gary Engel, were conducting cloak-and-dagger surveillance of Victim 2's pregnant wife while at the same time outfitting a vacant Northwest Side storefront with the industrial equipment needed to chop up a body as part of the separate plot to kill the businessman.

At one point, the FBI was conducting aerial surveillance as Mandell crouched down next to a car in a suburban mall parking lot, allegedly to install a tracking device on the car of one of his girlfriends, according to court records.

In recent months, Mandell's case has also been linked to the suspicious death of Giacomo Ruggirello, a Lake County restaurateur who perished in a fire in September 2012. The Tribune has previously reported that someone had broken into Ruggirello's Highwood restaurant on the same day as the fire and taken the office safe. Mandell's attorneys have subpoenaed the records from the suspected arson investigation.

Authorities have alleged that Mandell's schemes didn't stop with his arrest. Days later, he called his wife — an 82-year-old Buffalo Grove woman — from a federal Loop jail and asked her to get rid of evidence in the case, his indictment alleged. Prosecutors have also alleged that Mandell tried from jail to arrange the murder of the FBI's key informant in the case — a man previously identified by the Tribune as Northwest Side real estate mogul George Michael.

Originally from the Italian section of Chicago's Near West Side known as "The Patch," Mandell's criminal history goes back to his days as a Chicago cop in the 1970s and '80s. After he was booted from the force for insurance fraud, Mandell was accused of taking part in a mob-connected jewelry theft ring and other alleged schemes, including the kidnapping and extortion of several drug dealers in Kansas City, records show.

Mandell was eventually sent to death row for the drug-related 1990 slaying of a trucking firm owner, and at his sentencing prosecutors linked Mandell to two additional unsolved murders, including the 1986 killing of his own father, Boris, according to court records.

Both his murder and Missouri kidnapping convictions were overturned on appeal after Mandell alleged authorities fabricated evidence and used a notorious jailhouse snitch to frame him. He sued the FBI and won a landmark $6.5 million in damages from a federal jury in 2005. However, a judge later threw out the award, and Mandell did not receive any money.

Records show that after the jury verdict, Mandell moved to Florida, married and started a lock and safe company out of his wife's home. When he returned to Chicago, he had changed his last name from Manning to Mandell, records show.

Mandell's trial in February will focus on a series of undercover recordings made in fall 2012 at Michael's Northwest Side realty office and the storefront on West Devon Avenue jokingly referred to in recordings as "Club Med," where Mandell and Engel allegedly planned to dismember the businessman's body.

While much of the transcripts have been blacked out for undisclosed reasons, the portions that have been made public in court filings highlight the allegedly disturbing nature of the conversations that jurors in Mandell's trial are likely to hear.

Prosecutors allege Mandell and Engel planned to wage "psychological warfare" on the kidnapping victim to coerce him to turn over his assets. In an undercover FBI recording made at Club Med in the days before the planned kidnapping, the two discussed everything from how to instill the most fear in their victim to how best to drain his body of blood.

According to one prosecution filing, Mandell was referring to the victim's genitals when he asked his alleged accomplice, "You going to put a little blade there?"

"It's like slicing a banana split," the filing quoted Engel as responding.

Following his arrest in October, Engel was found hanged in his jail cell in McHenry County, a death that has been ruled a suicide.

According to court records, Mandell was also captured talking extensively about Quaranta and Stavropoulos and their stake in Polekatz, a multimillion-dollar strip club in the south suburbs that has been engulfed in controversy over its murky finances and alleged ties to felons and organized crime associates.

Stavropoulos, identified by the Chicago Crime Commission as an organized crime associate, was brought on as a $5,000-a-week consultant at the club about a year after his release from prison for running a multistate bookmaking ring, according to court records.

A 2010 Tribune investigation also documented how Stavropoulos partnered with another alleged underworld figure, Michael "Jaws" Giorango, and borrowed millions from the family bank of former Illinois Treasurer Alexi Giannoulias, who at the time was running for the U.S. Senate. Giorango and Stavropoulos used the money to launch their own lending business that made high-interest, short-term loans to questionable borrowers, the Tribune found.

Quaranta, meanwhile, quit the Franklin Park police in late 2002 at about the time prosecutors dropped charges that he had illegal steroids delivered to his house, records show. He later lent about $500,000 to Polekatz and became a highly paid consultant to the club. Records show that in addition to his interest in Polekatz, Quaranta either owns or has a financial interest in four other strip clubs and taverns from suburban Bedford Park to Indiana and Texas.

Quaranta did not respond to phone calls seeking comment. His attorney, Ed Wanderling, returned a message left on Quaranta's cellphone and said he could not comment on a pending investigation or "what Steve Mandell's ideas or plans were." Wanderling said he was not aware of any plans by prosecutors to use Quaranta as a witness in Mandell's trial.

Reached by telephone recently, Stavropoulos declined to speak about the case. When asked about Mandell, Stavropoulos responded, "Who?"

According to the filing by federal prosecutors, to move in on the Polekatz action, Mandell decided that it made more sense to kill Quaranta, who has no criminal record and would therefore have an easier time fighting the takeover in court if he was left alive.

On the recordings quoted in the government filing, Mandell ruminated how Stavropoulos understood muscle and would step aside once he saw that Mandell meant business.

"Although he's got a big ego, when he sees what happens to (Quaranta) and his old lady … he might (expletive) all over himself, too," Mandell allegedly said of Stavropoulos.

Mandell developed a plot to kill Quaranta and his wife at home while their children were in school, according to the government filing. He lamented it might be a "rush job" but was ready to ad lib if necessary, according to the undercover recordings.

"I know from military strategy what George Patton said, battle plans are as good as the first shot fired," the government filing quoted Mandell as saying. "Once that first shot's fired, you're almost into improvisation, right?"

Mandell's attorneys had sought to have the wiretaps barred from trial, arguing the FBI could have used normal investigative techniques to stop the alleged schemes. In denying the request last month, U.S. District Judge Amy St. Eve quoted snippets of a wiretapped conversation from almost a month before Mandell's arrest that showed he had planned to act dumb and lawyer up if authorities came around asking about Quaranta's murder.

"How can I help you with this (expletive)?" Mandell said he would tell investigators, according to the government filing. 'Wow — he was — this is a murder investigation? … I have a lawyer to attend to this. They'll gladly handle all your questions."

Mandell then planned to point investigators in another direction by remarking on Quaranta's background as a strip club operator.

"Italian guy, Franklin Park cop who runs five joints? That smells like organized crime," Mandell said he would say. "I think you're in the wrong neighborhood. Go beat on someone else's door."

Thanks to Jason Meisner and Joseph Ryan.

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