of Overland Park, Kan., a Web hosting company that they said was secretly controlled by Richard Martino. Prosecutors charged that the Web sites used in the Internet scam were part of a joint venture formed in 1996 between Crescent Publishing Group Inc., a Manhattan company that published such high-profile adult magazines as Playgirl and High Society, and Lexitrans Inc. In 1999, they began processing credit transactions in Guatemala to further muddy the waters, the documents said. The defendants routinely changed corporate billing names and merchant banks to stay one step ahead of authorities and foil Visa USA’s fraud-detection system, according to court documents.

That allowed the defendants to plead guilty to the crime without acknowledging that the scheme was an organized crime operation.Īt the same time, the scheme trapped Web surfers seeking adult content on the Internet by enticing them to enter their credit card information for “free” tours, only to begin billing them between $20 and $90 a month. Under a plea bargain worked out over the weekend, prosecutors dropped the racketeering allegation, which had been a central part of its case. District Court in Brooklyn - on the day jury selection was to have begun - were the alleged mastermind of the scheme, Richard Martino, 45, known in the New York tabloids as the “X-rated mobster,” and 45-year-old Salvatore Locascio, described by authorities as a Gambino “capo,” or captain. The mobsters also ripped off two federally supervised funds that subsidize rural phone companies through another billing scam, they said.Īlleged mastermind, Gambino ‘capo’ enter pleasĪmong those who entered guilty pleas Monday in U.S. But in this case, prosecutors said, the hoods targeted phone customers and Internet users, tricking them into responding to too-good-to-be-true offers of free porn, psychic readings, dating services and sports picks, and then putting the hurt on their pocketbooks with a series of unauthorized credit card and telephone charges.

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