American Scandal

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Every scandal begins with a lie. But the truth will come out. And then comes the fallout and the outrage.

Scandals have shaped America since its founding. From business and politics to sports and society, we look on aghast as corruption, deceit and ambition bring down heroes and celebrities, politicians and moguls. And when the dust finally settles, we’re left to wonder: how did this happen? Where did they trip up, and who is to blame? From the creators of American History Tellers, Business Wars and Tides of History comes American Scandal, where we take you deep into the heart of America’s dark side to look at what drives someone to break the rules and what happens when they’re caught. Hosted by Lindsay Graham.

Payola - Anything for a Hit | 6

Payola - Anything for a Hit | 6

Tue, 28 May 2019 07:05

Records stuffed with cash. Cassette cases full of cocaine. The details revealed at record promoter Joe Isgro's payola trial shock the public. And the trial's outcome is an even bigger surprise.

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On October 28, 1988, Roulette records owner Morris Levy sits next to his lawyer in a Camden, New Jersey courtroom. The 61 year old music mogul is dressed conservatively in a dark suit and crisp white shirt with gold cufflinks. He wants to make a good impression. It's his last chance before a judge passes sentence on him for extortion and racketeering. Levy's seen his share of courtrooms over the years. He's been investigated by the FBI, the IRS, the New York Attorney General, and even Congress. They've all scoured his business records and personal finances looking for any evidence of his long rumored criminal activities, especially his ties to the mafia. But nothing's ever stuck until now. The court clerk announces the United States District Court of the State of New Jersey is now back in session and introduces the man entering in black robes as the normal judge Stanley S. Broadman. You may be seated. Levy listens as his lawyer delivers a final statement on his behalf. Morris Levy has given money to all kinds of people. He buys wheelchairs for paralyzed children. He donates millions to charities. He's been a major force in American music by virtue of his honesty and his integrity. Mr. Levy is a good decent human being. His lawyer sits and the judge directs his gaze at Levy. Mr. Levy, do you wish to say anything? Levy rises from his chair. He's still a big man, well over 200 pounds, getting up takes a minute. A thousand thoughts are racing through his mind, but he can only manage to put one of them into words. Your honor. I'm innocent. That's all I can say. I believe I am innocent. Levy slumps heavily back into his seat, and the prosecutor rises to make his final remarks. Your honor, you have heard the defense attempt to characterize this as a normal business transaction. What he was anything but normal. The defendants conspired over a year against John Lamont, threatening him with physical harm. John Lamont, of all people, how is it possible that he could be the agent of Levy's undoing? Lamont was the reason Levy got involved in the extortion to deal for which he's now been convicted. He wanted to teach the young punk a lesson, hayback for once pirating some of Rulette's releases. But Lamont went to the feds, and the feds came for Levy. The prosecutor is done speaking. Now it's the judge's turn. This is not an easy case to sense. There's no doubt in my mind that Mr. Levy has done a lot of good, but that in itself does not excuse the crime for which the jury has found him guilty. Mr. Levy, will you please rise? The defendant is hereby committed to the custody of the Attorney General for a term of imprisonment of 10 years. Baile is set at $3 million. Morris Levy sits back down in a daze, barely hearing the words of reassurance from his lawyer. Don't worry Morris will win on appeal, and you can afford the Baile. You won't see a day inside a cell. Levy wants to believe that's true, and a minute ago he would have. But now he's overcome with a feeling of resignation. All his life, he stayed one step ahead of the law. He's done it by being smart and ruthless. He's also gotten lucky. He wonders if now, finally, his luck has run out. American scandal is sponsored by the new ABC drama Alaska Daily. When an indigenous woman goes missing in Alaska, it sparks new questions about other missing and murdered indigenous women. That's where the thrilling new ABC drama Alaska Daily begins, and where it's headed, will have you on the edge of your seat. Two time Academy Award winner Hillary Swank stars as Eileen, a veteran reporter, who joins a team of local journalists working to bring the truth to light. From Academy Award winning screenwriter Tom McCarthy, Alaska Daily premieres Thursday, October 6th on ABC, and streams next day on Hulu. If you're into true crime, the Generation Y podcast is essential listening. We started this podcast over 10 years ago to dissect some of the craziest and most notable murders, crimes, and conspiracy theories together, and we'd love for you to join us. Follow the Generation Y podcast on Amazon Music or wherever you listen to podcasts. I'm Wondry, I'm Lindsey Graham, and this is American scandal. We started this story in the 1950s. Now it's the 80s, and pale is the scandal that won't die. In our last episode, new revelations rocked the music industry. One brought down Morris Levy, a veteran of the business longroobert, and now proven in court to have ties to the mafia. At the center of the other scandal is a powerful independent record promoter who's also alleged to have mob connections. His name is Joe Isgro, and he stands accused of funneling millions of dollars in payola to radio stations all over the country on behalf of every major label. The Fed's think is grows the head of an entire network of criminal promoters that taking him down put an end to payola for good. This is episode 6, anything for a hit. Marvin Rudnick used to love his job. As a special attorney for the Justice Department's organized crime strike force in Los Angeles, he's become an expert at tracing dirty money through seemingly legitimate businesses back to the illegal activities it's actually funding. He's been with the strike force for nearly a decade and won dozens of cases with a higher conviction rate than nearly all his peers. But by March of 1988, Rudnick Dreads going to work. He's a bulldog of a prosecutor with a reputation for subpoenaing every document and chasing down every lead. He's rough edged, pugnacious, and has little patience for political games. His new boss, John Newcomer, is the exact opposite, a career bureaucrat who's risen through the ranks by carefully choosing his battles. Newcomer despises Rudnick and he makes it clear every day. When Newcomer arrived, Rudnick's two biggest cases involved the music industry. One was an investigation into payola. Rudnick was close to inditing a major figure in the payola racket, independent record promoter Joe Isgro. But then he was abruptly taken off the case. Rudnick suspects it was a political move that his investigation's broad scope was making too many powerful people in the music industry nervous, and that they called in a few favors to get him taken off the case. Still, having payola off his plate does leave Rudnick free to focus on his other case, an investigation of a mobster named South Picello, also known as South the Swingler. Somehow, Picello wound up working as a consultant for a major record label, MCA Records, then failed to report all his MCA earnings on his income taxes. Rudnick loves a good tax evasion case and could live with justice one case if he were actually still in charge of it. Officially, he still is, but Newcomer dogs him every step of the way. When the trial begins in March of 88, Justice Department higher ups in Washington assign Newcomer as Rudnick's co counsel. But Newcomer doesn't actually do any legal work, and it soon becomes clear that he's just there to keep Rudnick in line. Outside the courtroom, he openly skulls Rudnick in front of reporters. Inside, he passes notes while Rudnick's in the middle of cross examining witnesses. One says, wrap this up, it's not helping our case. Rudnick had hoped the Picello trial would give him a chance to unravel the story of how a low level mobster with no prior music industry experience came to work for one of the biggest record companies in the world. He knows parts of the story. Picello apparently got the job through Morris Levy, then paid Levy back for the favor by arranging to have MCA sell him over four million old overstock records at a very low price. But Rudnick's still not sure why or how Picello was put in charge of such a huge inventory of records in the first place. Or whether he was part of Levy's subsequent attempt to rip off a wholesaler named John Lamont by selling him only the junk parts of the shipment. He also suspects senior executives at MCA, no more about Picello and the overstock deal with Levy than they're letting on. But newcomer won't let Rudnick pursue any of these threats. He insists that Rudnick narrowly focus on the original charge against Picello, tax evasion, ignore any aspects of the case that might overlap with the charges against Levy. He also discourages Rudnick from digging too deeply into Picello's relationship with MCA records. At times Rudnick thinks it's almost like newcomer works for MCA and not the Justice Department. But despite the many hurdles newcomer puts in front of him, Rudnick wins a conviction. On April 8, 1988, Picello was found guilty of tax evasion. But to newcomer, it's as if the verdict never happened. A few days after the trial, he called Rudnick into his office and chews him out. You're an embarrassment, newcomer snorls. You did a lousy job at the trial. At this point, a normal person would probably start looking for another job. But not Martin Rudnick. He became an attorney because he believes passionately in the pursuit of justice. He won't give up his job at the strike force without a fight. So over the next year, Rudnick and newcomer remain locked in a battle of wills. newcomer assigns Rudnick no new cases, relegating him to busy work, photocopying documents for other prosecutors cases, or responding to freedom of information requests from the media. He berates him in front of other strike force staff, but still Rudnick refuses to quit. Finally, things come to a head. On March 30, 1989, nearly a year after the Salpicello trial ended, newcomer summons Rudnick into his office. The two have barely spoken in months, so Rudnick can guess what's going to happen. John, you wanted to see me? Marvin, close door. Have a seat. Compared to Rudnick's small office, newcomers is polatial, with chrome chairs and a black leather couch. Rudnick chooses one of the chairs. newcomer sits behind his large oak desk. He's middle aged with thinning hair and thick reading glasses. As he squins through them at the documents on his desk, he tilts his head back contemptuously, like he's examining something stuck to his shoe. I want you to read this letter from the department. It's from the Justice Department's criminal division chief in Washington, addressed to Rudnick. It reads, you are hereby placed on temporary duty status with pay pending determination of your full time employment. He's being suspended, most likely soon to be fired. I want you to want this to start, John. Right now, I'll need your office key, your department ID, and your parking pass. There's no point in arguing. Wordlessly, Rudnick places all the requested objects on newcomers desk. I'll accompany you to your office. You're not taking any documents, personal effects only. Along Windalous Hall connects all the strike force offices. Today, it feels even longer than usual. The place is deserted. Every office empty or door closed. As if everyone knew this was coming, I didn't want to be here to see it. In his office, Rudnick fills a legal storage box with family photos, a few books, pens, and a Justice Department service plaque. Newcomer hovers over him like a security guard. There's a surreal quality to the whole situation. As he packs, Rudnick remembers something that day more than a year ago when he got a menacing phone call from one of MCA records lawyers. We have friends in the courthouse. We can make life very difficult for you. Is MCA making good on that threat? Or did John Newcomer just have it in for him from the beginning? As Rudnick loads his stuff into the trunk of his Chrysler and pulls out of the federal courthouse parking garage for the last time, he decides he no longer cares. MCA records can be somebody else's problem now. On May 21, 1989, more than three years into the Payola investigation, independent record promoter Ralph Tashgian pleads guilty to one count of Payola, plus one count each of filing a false tax return and obstruction of justice. He could face up to nine years in prison and become the first person ever to serve serious time for a Payola offense. As severe as the punishment sounds, for Tashgian, known in industry circles as Tash the Flash, it's a good deal. Tash was originally charged with 168 separate counts of Payola, one for each documented instance of him bribing a radio DJ with cash, cocaine, or both. What he worked for the Payola investigation's primary target, Joe Isgro, and in exchange for testifying against Isgro, he agreed to plead guilty to the shorter list of charges. And there's more good news for Tash too. A year ago, IRS agents arrested both him and his wife Valerie at the couple's home, forcing them to leave their three year old son behind with a frightened nanny. Now a judge calls that arrest reprehensible, and chastises strike force prosecutors for trying to intimidate Tashgian by arresting his wife for the relatively minor offense of preparing a false tax return. The judge throws out the Justice Department's case against Valerie and she heads home. For Strike Force Chief John Newcomer, the Valerie Tashgian episode is a black eye on his Payola investigation. In taking Marvin Rudnik off the case, Newcomer argued that he was a loose cannon to aggressive and unpredictable to handle something so important. But now Rudnik's replacements have botched the handling of a key witness with exactly the sort of bullying tactics Newcomer hates. Furious, Newcomer reassigns a Payola investigation yet again, to the fourth lead prosecutor since Rudnik left the case just two years ago. But this time he convinces his bosses in Washington to send him a big gun, senior counsel William Lynch. Lynch is a Justice Department veteran appointed by Bobby Kennedy when he was Attorney General in the 60s, round faced and white haired, with a theatrical style in the courtroom, he's prosecuted hundreds of organized crime cases. Newcomer sure that Lynch has the experience to see the Payola case through to some convictions, especially their big prize, Joe Isgro. On November 30, 1989, a man with slicked back hair and a burnt Reynolds mustache walks into the lobby of the Federal Courthouse in downtown Los Angeles. He looks around uncertainly, a security guard notices him and approaches. Can I help you, sir? Uh, turning myself in, I'm under indictment. Your name, Joseph Isgro. The guard goes to the security desk and picks up a phone. Joe Isgro waits, nervously cracking his knuckles. Friend Callam at home earlier today when he saw Isgro's name on the morning news. Finally, more than three years after it was first convened, the Payola Grand jury indicted him. He's charged with 57 counts, distributing Payola, racketeering, conspiracy, mail fraud, and God knows what else. Apparently, if he's convicted on all counts, he could be sentenced to 200 years in prison. 200 years. He didn't even know they gave sentences that long. You'd think he'd murdered the Pope. Two plain clothes, Federal agents stride into the Courthouse lobby looking pissed. Joe Isgro, you're under arrest. They grab Isgro by his shoulders and twist his arms behind his back. He feels the cold middle of handcuffs clamping around his wrists. Jesus, guys, go easy. I'm here to turn myself in. We've had agents all over town looking for you, Mr. Isgro. You could have stayed home and saved us all a lot of time. The agents march in through the Courthouse lobby and cross the street to the Federal building, a nondescript class and concrete structure. It passed through a small plaza between the two buildings. It's a warm autumn day and Federal employees are out having lunch or grabbing a cup of coffee. In this part of town, it's not unusual to see handcuffs purps being led from one building to the next, so most of them barely glance up. But on the steps of the Federal building, there's a camera crew. Isgro sees an NBC logo on one camera, then a familiar face under a perfectly styled head of sandy blonde hair. It's Brian Ross. The reporter who three years ago made Isgro the prime subject of a sensationalized story about Péola. Ross thrusts a microphone at Isgro. Joe, any comment? Isgro wants to spit on Ross's perfectly polished shoes, but he says nothing as agents haul him through the Federal building sliding glass doors through a metal detector and into a waiting elevator. Upstairs, he's booked in fingerprinted, then it's back to the Courthouse where he pleads not guilty to the charges. His bail is set at $500,000. Isgro doesn't have it, not even enough for a bail bond, so he spends the night in jail. But then, 24 hours after turning himself in, Isgro goes home. His lawyer has persuaded the judge to reduce his bail, assuring the court that Isgro's not a flight risk. He's a legitimate businessman, eager to defend his good name in a court of law. Only a few years ago, before Brian Ross and NBC ran their Péola story, Isgro was pulling down millions a year in independent record promotion. He was one of the wealthiest and most powerful members of the network, a group of any promoters who together controlled access to nearly every major station in the country. Now, Isgro's broke, disgraced, accused of conspiracy with a mob to launder money and to keep the top 40 DJs in line. So far, it's all hearsay. Even the NBC report didn't really prove anything except that yes, some of Isgro's friends are mobsters. But so what? Lots of working class Italian guys from New York and Philly grew up around mobsters. But now, with a trial looming, Isgro knows it will be harder to persuade people that he's innocent. Already, several of his former employees have turned against him, not just Ralph Tashgian, but his trusted bodyguard too, David Michael Smith. At the trial, he knows both Tashgian and Smith will say anything to save themselves. Still, Isgro hasn't given up hope. He's always been a fighter. He's a decorated Vietnam vet, a Marine with several confirmed kills. He broke into a record promotion the hard way, working as a regional rep for several labels, including Morris Levy's roulette records. Isgro's always admired guys like Levy, old school record man who did things their way, bent or broke the rules and didn't care who they pissed off in the process. Now he hears Levy's about to go to jail himself for some mafia thing. And sad. Still, Isgro is looking forward to his day in court. He's convinced that he can beat the charges, prove his innocence. After all, if a poor Italian kid from South Philly can rise up to become one of the richest men in the music industry, anything is possible. What if your family was the victim of a home invasion? Or you woke up in the morgue? Or you were seriously injured miles from help? What would you do? This is actually happening, asks our listeners this very question while we bring you captivating real life stories of trauma and perseverance. This is actually happening brings listeners extraordinary true stories from the people who lived them. You'll hear stories about conflict, turmoil, or threats that dramatically alter the course of someone's life. Each episode is an exploration of the human spirit and how survivors manage to overcome hardship and move on with their lives, even thriving afterward. The new season of this is actually happening is available at free only with Wondry Plus. And if this new season isn't enough, you can listen to more than 120 exclusive episodes available only to Wondry Plus subscribers. Join Wondry Plus on Apple Podcasts or on the Wondry app. On a beautiful spring morning in May of 1990, Morris Levy calls himself out of bed and opens the curtains, letting in the sunshine. He's at his house in upstate New York, which sits on 1100 acres of farmland. He never tires of the view from his bedroom window, rolling hills dotted with grazing dairy cows, a red barn, the forest peaks of the Berkshire Mountains in the distance. Nearly everything he can see between here and those mountains, he owns. It's a reassuring sight. Levy bought this farm back in the 1960s as a retreat from the stress of roulette records. He kept it running as a working dairy farm and added a stable for his collection of racehorses. His friends from down in the city have spent many long weekend here. Over the front door of the Grand Colonial Style Main House hangs a sign that reads, a sunny place for shady characters. Now Levy's retreat has become his hospice. He's dying of cancer. It started in his colon, then spread to his liver. In January, a doctor gave him only a few months to live. But that was five months ago and he's still here. As usual, he's not going down without a fight. And he's still fighting his extortion and racketeering conviction, too. His latest appeal was denied back in November. Since then, his lawyers have argued that he's too ill to do time, and so far the argument has worked. However, Levy goes, he's ready. His affairs are in order. Last year, he sold roulette records to an independent label out in Los Angeles, Rhino Records, which specializes in repackaging and reissuing old catalog. Levy pocketed about five million from the deal, probably a fraction of what roulette was actually worth. But he wanted to walk away clean. Levy's kids are real inheritance, not a messy business built on years of handshake deals and shady bookkeeping. Levy has no regrets. Maybe the mortgage on this farm was paid for on the backs of artists who never got all the royalties they deserved, artists like Joey D and the Starlighters, Frankie Lyman and the Teenagers, Tommy James and the Chondelles. But so what? Without Morris Levy backing them, doing whatever it took to get their songs on the radio, no one would have heard those acts at all. As far as Levy's concerned, he's earned every acre of this farm, and he's earned the right to die here in peace, no matter how much the feds want to lock him up. Levy staggers back into bed and calls out for his oldest son, Adam, the only family member who stood by his side through these final days. Levy's fifth wife left him shortly after his conviction and took their two young children with her. God knows where his other ex wives are. Still, his final days have not been lonely. Many of Levy's old music industry friends have come up to the farm to pay their respects. Even little Richard, now an ordained minister, calls nearly every day, asking Levy to pray with him, and Levy tells him to go scrumself. On May 21st, 1990, Morris Levy succumbs to cancer. He's 62, and he never serves a day in prison. In a Los Angeles courtroom on August 21st, 1990, David Michael Smith sees his former boss Joe Isgro for the first time in three years. He barely recognizes the man he used to bodyguard. Gone are his ghost gold jewelry, cashmere sweater, and slick back hair. Instead, he's dressed conservatively with a neat haircut, simple navy blue suit, and dark tie. If it weren't for his bushy black mustache, Smith might have mistaken him for the attorney, not the accused. This day two of Isgro's pale attrial, and Smith sits in the gallery, one row behind the prosecutors, waiting for his turn to testify. A plane clothes US marshals sits next to him, looking bored. Smith is in the witness protection program. As soon as he's done testifying, he'll be whisked off to some unknown destination, somewhere Isgro's mafia buddies can't find him. Smith didn't really want to testify against his former boss. That's why as soon as he was first subpoenaed three years ago, he fled back to his native England. Smith is a tough guy, a six foot two former boxer, but he's seen what can happen to people who run a foul of Isgro. People like that DJ Miami. A few days after that guy was on NBC News talking about Peola, someone put him in the hospital. They never proved Isgro was behind the attack, but as far as Smith is concerned, they didn't have to. He recognizes his former boss as a handiwork. But after a few years on the land, Smith couldn't hide any longer. He was going broke and struggling to find work. Desperate, he called one of the record labels to see if they'd pay him to give them a statement. He'd heard Isgro was suing the labels for destroying his business and figured maybe his inside knowledge of Isgro's operations would be worth something to them. But no, the record label just reported him to the authorities, and by then Smith was tired of running. Promised witness protection, he flew back to the States and turned himself in. While Smith waits to testify, he watches the rest of the trial unfold. Up on the witness stand, a top 40 station manager is testifying. George Crowe, Smith handed him many an envelope full of cash on his grows behalf over the years, mainly in the men's bathrooms of restaurants all over Hollywood. The prosecutor asked Crowe how much cash, about 100,000 a year Crowe replies, squinting through his thick glasses. Smith wonders if it was really that much. He never bothered to keep track. After a few questions from Isgro's lawyer, Crowe is dismissed. As he steps down from the witness stand, he catches Smith's eye and gives a halfhearted wave. Smith doesn't wave back. Then it's Smith's turn. As the bailiff swears him in, Smith shoots a nervous glance at his grow, but his grow appears to be staring at his loafers. He never makes eye contact. The prosecutor is a white haired bigwig from Washington named William Lynch. He's loud, theatrical, a little too pleased with himself. Smith thinks. They went over his testimony a few days ago, so Smith knows what to say and how to say it, but can't resist going a little off script. Mr. Smith, how do you know the defendant? I worked for him for six, maybe seven years, security mostly, but you performed other tasks as well. I did. Can you give some examples? Drivers, driver, courier. As a courier, did you ever handle cash? Sure, all the time. Mr. Smith, do you know our previous witness, Mr. George Crowe of KiQQFM? I do. Did some of this cash you handled ever go to him? Every week, usually in the Lou. Smith's testimony takes hours. He describes flying up to San Francisco to collect suitcases full of cash from Isgro's accountant, Dennis Dereco. He details dividing that cash up into payments for DJs, program directors, and station managers. And he mentions people outside the radio industry too. Mr. Smith, isn't it true that you also saw Mr. Isgro give cash to a man named Joseph Armone? I did three times. For how much? One was for $10,000. I'm not sure about the others. Do you know what these payments were for? Mr. Armone said he was making some loans on Mr. Isgro's behalf. So this wasn't Peola? No, sir. Joe Armone's not a DJ. He's a mafia enforcer. Jackson, speculation. Your honor, if I may. Mr. Smith, how do you know if Mr. Armone was in the mafia? Because Mr. Isgro told me he wasn't. Nothing further, your honor. After a few perfunctory cross examination questions from Isgro's lawyer, Smith is dismissed. Isgro hasn't clandered his way even once. By the end of the first week, lead prosecutor William Lynch is already sure he's got this case in the bag. As more former Isgro employees take the stand, a picture emerges of an elaborate criminal enterprise masquerading as a music company. There are descriptions of cash brides to dozens of DJs, kickbacks to record company executives, a sham corporation set up by an Isgro associate to laundromoney and buy cocaine. The testimony of record promoter Ralph Tashgian is especially damning. Tash the flash describes slipping baggies of coke into empty cassette cases and handing them out to DJs in his territories. The list of records for which he did this is eye popping. Major singles by Bruce Springsteen, Prince, Cindy Lopper, Phil Collins. We worked with everyone, Tash says. Tash insists that the cocaine payments were his idea. But when Tash told Isgro what he was up to, his boss's response was, well, if that's what it takes, do what you got to do. So in a word, the prosecution is going well. Back at the strike force offices after the first week of testimony, Lynch pokes his head into John Newcomers office. Why'd you have such a hard time finding someone to lead this case? It's a slam dunk. It's Tuesday, September 4, the third week of the trial. Joe Isgro can't believe how long this all takes. There are hours of cross examination, documents to be read, evidence to be entered, long delays while the judge confers with elite attorneys in his chambers over some technicality. Over the course of the trial, Isgro's mood has gone from defiant to depressed to mind numbingly bored. He's beginning to think prison couldn't be much worse than this. On the last day of the previous week, his attorney filed some new motion, something about a witness who gave conflicting testimony in another trial. The witness was Isgro's accountant, Dennis Dereco. Apparently, at his own trial last year, where he was accused of tax fraud and distributing cocaine, Dereco denied doing some of the things he admitted to on the witness stand at Isgro's trial. To Isgro, it doesn't sound like a big deal. Witnesses lie all the time, but his lawyer says it's worth bringing up. Now, this morning, Isgro's attorney emerges from another long session in judges chambers, practically doing cartwheels. He slaps Isgro on the shoulder as he takes a seat, race yourself Joe, he whispers, you're about to get some good news. Isgro looks over at the federal prosecutor, William Lynch. Lynch usually looks like the cat who ate the canary, but today, his perpetually smug expression is gone. He looks stunned. The judge enters scowling. Everyone rises, then quickly sits again as the judge starts laying into Lynch. He accuses Lynch in his team of deliberately hiding Dereco's earlier testimony, knowing it would undermine his credibility as a witness in the case. Without Dereco, the only witness who had full access to Isgro's financial records, the judge doesn't believe Lynch has a case. But more than that, he's clearly furious at what he sees as the prosecution's attempt to sneak one past him. Glowering at Lynch, the judge proclaims, owing to your outrageous misconduct, the court finds that dismissal with prejudice is called for in this case. The judge bangs his gavill and gets up from his days. Behind him Isgro hears a mad scramble, a dozen reporters from the Los Angeles Times, New York Times, billboard rolling stone, all gathering their belongings and rushing to pay phones have called their copy desks. He turns to his lawyer not quite believing what he just heard. What just happened? Your free Joe, lawyer says, the feds blew it. Dismissal with prejudice means the case can never be retried. Outside the courtroom, Isgro is mobbed by reporters. I'm relieved. Happy, he tells them. Last five years have been very difficult. After those long five years, the dismissal of the pay all the case against Joe Isgro took less than 30 minutes. He's back to his Glendale bungalow before lunchtime. The first thing he does is call a friend who works at 20th Century Fox. They've been talking about a new career path for Isgro, a film producer. They've even agreed on an idea for a project, a biopic about Jimmy Hoffa, a labor organizer who was allegedly linked to the mafia, and eventually assassinated by them. Isgro figures producing movies can't be that hard. His friend says it's mostly about financing, convincing enough people to give you enough money to get the project made. If there's one thing Joe Isgro is good at, it's convincing people to give him money. By the end of 1990, everyone around the music industry can breathe a sigh of relief. The latest pay all the scandal is over. Though independent promoters continue to operate, they no longer have a monopoly on top 40 radio. A few, like Joe Isgro, have been driven out of the business. Only one promoter, Ralph Tashgian, is convicted of any wrongdoing. He pays a fine and serves 60 days in a minimum security facility. To most people in the music industry, it hardly matters whether Isgro and Tashgian were pay all his worst offenders or just the unlucky ones who got caught. Their stories will serve as cautionary tales to discourage future promoters from offering bribes and radio employees from accepting them. At least, that's the hope. But payola never goes away, not entirely. In 2004, at the Office of New York Attorney General Elliot Spitzer in Albany, New York, a deputy DA named Terrell Brown Clemens sits reviewing documents for her latest case. She's a 10 year veteran of the District Attorney's Office, an ambitious black woman in her early 40s who's worked her way up to a position in which she oversees a staff of 160 attorneys. She calls out to a colleague, hey, what do you know about payola? Payola, he replies, mobster stuff? Old news. And that's what Clemens thinks too. At first glance, the case Spitzer has assigned her seems flimsy. A few complaints from small time radio promoters and no name recording artists, claiming a conspiracy between the major labels and the big radio conglomerates to deny indie artists access to the airwaves. They say the new system is called pay to play and it's rampant, but they don't have a lot of evidence. As usual, Spitzer's down in his New York City office, where it's easier for him to court the national media attention he can't seem to get enough of. So Clemens is surprised when he takes her call. This case is top priority, Terrell. Spitzer tells her, start with the radio stations, subpoena emails, financial records, see what you can trace back to the major labels. And a few months later, Clemens can't believe what her team is uncovering. Not only is payola still alive and well, it's evolved into some absurd new permutations. Among the documents they've subpoenaed is an email from a promotion director at Epic Records. What do I have to do to get audio slave on WKSS this week? It screams in all caps. Whatever you can dream up, I can make it happen. A memo from another label is even more blatant. To promote a song called ADIDAS by rapper Killer Mike, DJs would be sent one sneaker. If they could prove they spun the song at least ten times, they'd get the second sneaker, autographed by the artist. Perhaps the weirdest and most damning scheme they uncover is a plan by Epic Records sister label Ayrista to pay a team of callers to flood several stations request lines, all asking for the label's latest single. Please be sure callers are male and under 25, or sounding like it when email reads. When Clemens brings her findings to Spitzer, his eyes light up. He's planning a run for the governor's office and this is campaign trail gold. In July of 2005, Spitzer's investigation wins its first victory. Epic's parent company Sony BMG fires the label's head of radio promotions and agrees to pay a $10 million settlement. At a press conference in New York, Spitzer hails the terms of the settlement as a model for breaking the pervasive influence of bribes in the industry. A few weeks later, in a California jail cell, Joe Isgo reads that Spitzer quote in a doggeared copy of Rolling Stone and laughs out loud. Good luck with that buddy, he thinks. Isgro's nearing the end of a four year sentence for loan sharking. He was arrested in 2000, outside of mall and Beverly Hills. This time he pled guilty. They had him dead to rights. Before his arrest in conviction, Isgro's career had taken some interesting turns. His first film production, the biopic about mob connect Jimmy Hoffa, lost money, but earned two Oscar nominations, and didn't much to restore Isgro's reputation around Hollywood. After that, Isgro went back into music, not as a pro boner, but as the head of his own artist management company Mecca Management. Mecca handled tours for the likes of James Brown, the Isle brothers, and Shaka Khan. Shortly after Isgro's arrest in March of 2000, a Mecca artist called Baha Man released the biggest hit of their career who let the dogs out. Mecca was a successful company, but for Isgro, he wasn't enough. So he got into loan sharking, that landed him in prison. A few years after his release in 2009, Isgro returned to crime. He conspired with members of the Campino Mafia family to set up an illegal offshore gambling operation. That scheme got him arrested again in 2014, but this time he was able to cop a plea deal and avoid any jail time. So he's returned to filmmaking, and now he's working on a documentary feature about his life. It's called Hitmaker. From Wondry, this is episode 6 of 6 of Paola for American Scandal. On our next series, a journalist discovers a horrifying secret, evidence of a decades long conspiracy among government and public health officials to deny treatment to black men in the deep south infected with disease, the Tuskegee study of untreated syphilis in the Negro male. If you'd like to learn more about Paola, we recommend the book, Stiffed, A True Story of MCA, The Music Business, and The Mafia, by William Notalsayer. This episode contains reenactments and traumatized details, and while in most cases we can't know exactly what was said, all our dramatizations are based on historical research. American Scandal is hosted, edited, and exeked produced by me Lindsay Graham for Airship, sound designed by Derek Barrett's. This episode is written by Andy Herman, edited by Casey Minor. Execute producers are Stephanie Jens, Jenny Lauer Beckman, and are nonlopes for Wondry.