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His first major theft of FBI money occurred while he was supervising a major investigation called "Cali Watch," which involved the infamous cocaine cartel. After receiving $200,000 in FBI money for the probe, Sullivan put the cash, in tens and twenties, into his safe. Soon he was skimming from it for his gambling and debts. Cali Watch, meanwhile, ended, and Washington asked repeatedly for the money. Sullivan came up with sufficient excuses to delay repayment for more than a year. He managed to keep an FBI auditor named Peter Gordon at bay with various excuses. Another agent also got curious about the money, but Sullivan would "always tell him the money was there and that there was no need to count the funds," according to FBI reports.
"All his excuses were plausible," Mallett asserts.
Sullivan also stole another $100,000 in cash that was obtained from an informant, who'd gotten the money from a cocaine-trafficking ring that needed its money laundered. The FBI didn't know that money was stolen until after the investigation ended.
On August 12, 1996, Sullivan was given the job of supervising the organized-crime squad. By that time only $60,000 of the $200,000 was left. Sullivan told investigators that he simply put the cash in a blue bag when nobody was around and took it with him to his new office.
Seventeen days after his transfer to organized crime, agents seized the nearly $130,000 from Corozzo's safe in Deerfield Beach. The cash went into Sullivan's safe and was soon paying off gambling debts. Sullivan lied repeatedly during the next nine months about the money, once telling an inquiring agent that he'd put the money in a safe controlled by the head of the Miami office. After getting caught in a lie on May 15, 1997, Sullivan promised his superiors that he'd enter the money into evidence "as soon as possible."
Just five days later, Sullivan told a federal judge that Danny Laratro, who was serving a five-year prison term for his role in a Mafia-related marijuana-smuggling scheme, was giving him information on mob infiltration of South Florida's garbage-hauling business.
Based on Sullivan's testimony, Judge Stanley Marcus shaved twenty months off Laratro's sentence. Sullivan was lying again.
Laratro didn't pass along any information. Sullivan had gotten it from another agent. Sullivan did the favor for Laratro, a wealthy garbage hauler, in the hope that Laratro would reward him with money, according to both mens' lawyers.
Sullivan's involvement with Laratro provides a glimpse into his work with his other "family." During the late 1980s, Sullivan used to visit Danny Laratro's father, Lucchese crime-family capo Joseph "Joey Narrows" Laratro, in the family's $500,000 Hallandale home.
Sullivan, who was apparently trying to pry information from Joseph Laratro for cases, called the meetings "updates," says Joey Laratro, son of Danny, grandson of Joey Narrows. "He'd come and knock on the door, and they'd just talk about things."
The grandson said the fallen FBI agent still has a good name in the Laratro household. Joey Narrows used to tell relatives: "If this guy [Sullivan] ever comes to the house to arrest me, don't get mad at him. He's a good man. He's a class act. He's just doing his job."
Sullivan's job was about to end. Around the time he sprang Laratro, he also entered the remaining Corozzo money in evidence, just $30,064 of the original $129,324. On May 30 Sullivan was called into Sanchez's office, prompting Sullivan's solitary drive to Marco Island. The long and terrible marriage between Sullivan and the FBI was finally over.
Paul Mallett sits in his office in the FBI building, along with Miami FBI chief Hector Pesquera, special agents Brian Jerome and Mike Fabregas, and an FBI lawyer. They've come together, for the first time publicly, to try to explain their side of what Mallett calls the "Sullivan betrayal." It was January 8, the very morning Sullivan was transported to federal prison.
Mallett, a white-haired bureau veteran, says he's been criticized by FBI higher-ups for his role in the Sullivan affair, but declines to provide specifics. He says numerous FBI agents have been criticized or disciplined for their shortcomings in regard to Sullivan. He won't say specifically whether Smith was punished.
The Sullivan case has, in fact, led to numerous nationwide policy changes in the FBI. Accounting policies have become more stringent, Mallett says. "The procedures were flawed," he acknowledges. "Changes have been made. We now do our financial dealings with a degree of thoroughness we didn't have before."
Though Mallett once considered Sullivan a friend, he now thinks of him as just another criminal. Mallett believes the former agent had psychological problems, but doesn't excuse him. He is angry that Sullivan didn't just admit "that he's a dumb shit, and say, 'I lied and I stole and now I have to pay for it.'"
Mallett points out that Sullivan never complained about undercover jobs and that nobody forced him to do such work. Indeed, Mallett claims the FBI failed by trusting Sullivan too much. Agents depended on Jerry Sullivan and now they're paying for it. "He's tarnished every badge in this building," Mallett says.