U.S. MARSHAL IS CHARGED IN FORFEITURE SALES

A longtime deputy U.S. marshal in Newark was arrested yesterday on charges
that he secretly sold government-seized cars and land to friends and
relatives at a discount, then shared the profits when they resold the items
at market value.

Federal prosecutors said the officer, Dominick Russo, was able to pull off
the scheme because for nearly a decade, he had the sole authority to sell
millions of dollars of property seized by federal agencies in New Jersey
and parts of New York. The U.S. Marshal Service has since altered that policy.

In one case, Russo allegedly approved the sale of an Ocean City home to a
friend for $465,000, nearly $200,000 less than the property was worth. In
another, prosecutors say, Russo sold a forfeited 1990 Pathfinder to his
mother for $4,200, but altered the paperwork to suggest that a different
buyer purchased it. The car was soon resold for $5,000.

The grand jury returned its 21-count indictment last Friday, but the
document remained sealed until yesterday, when federal agents arrested
Russo at his home in Union.

Russo faces charges of conspiracy, mail fraud, embezzlement and witness
tampering. The most serious counts carry penalties of 10 years in prison
and a $250,000 fine.

U.S. Attorney Christopher Christie called Russo "the proverbial bad apple
of the bunch," and said investigators believed that he acted alone.

James Plousis, the U.S. marshal for New Jersey, suspended Russo without
pay. He said the arrest "saddens me and saddens everyone in this office."

Russo, 41, wore blue jeans, a black T-shirt and handcuffs when he appeared
yesterday before U.S. Magistrate G. Donald Haneke to hear the charges. He
was escorted from the courtroom by fellow marshals, but was expected to be
released on bond after agreeing to surrender his guns, his marshal's badge
and his passport. He is scheduled to be arraigned on Monday.

Russo joined the U.S. marshals in 1988 and became chief of the marshals
asset forfeiture unit three years later. He was reassigned to desk work
last year, as prosecutors began building a grand jury case, and was
suspended with pay in March.

Russo's attorney, Steven Turano, said his client committed no crime and
would be vindicated.

"Dominick has been acting in this role for a number of years," Turano said.
"Essentially, every single decision he makes could be subject to scrutiny."

Also charged in the conspiracy were Russo's half-brother, Anthony Russo,
56, of Waretown, and Patricia Eichelsdoerfer, 37, a Parsippany real estate
agent that sources said was Dominick Russo's girlfriend.

The indictment outlines the sale of five cars and three properties that
Dominick Russo approved between February 1998 and July 1999. Under Marshal
Service policy, seized cars were to be sold at auction and properties
publicly listed for sale. But in each case, prosecutors allege, Russo
arranged for the deals privately, and submitted false paperwork to appear
that the sales and buyers were legitimate.

The only direct payment to Dominick Russo mentioned in the indictment
occurred when he allegedly collected $3,500 in commission for the sale of a
Waretown home that had been seized. Investigators say Russo's half-brother
was the real buyer, but used an intermediary to complete the deal.

Eichelsdoerfer earned more than $15,000 in commission in the sale of the
home in Ocean City, and $2,400 more for the sale of a home along
Massachusetts Avenue in Atlantic City, according to the indictment.

Plousis became the U.S. Marshal for New Jersey in March and said he was
notified about the case almost immediately. He said Russo didn't protest
when he suspended him.

The office's forfeiture program typically oversees the sale of more than
100 cars and a handful of properties seized from defendants each year, he
said. Under the new policy, transactions involving seized property must be
approved by a supervisor, Plousis said. He said he was unaware of any other
similar infractions in the Marshals Service, but said agency executives in
Washington are reviewing the system and may implement additional changes.

"There's no question the old policy depended on the integrity of the person
administering the program," Plousis said.

John P. Martin covers federal courts and law enforcement.