LITTLE ITALY'S NEW MOB WOES

Rudy Giuliani made his reputation as a hard-driving U.S. attorney by
rounding up wiseguys in Little Italy.

But after seven years as an equally hard-driving mayor, he hasn't had as
much success connecting to viable community leaders in the historic district.

Anne Compoccia, installed by the administration in 1996 to clean up the
mob-tainted San Gennaro Feast, pleaded guilty last month to embezzling as
much as $120,000 from merchants involved in a summertime mall on Mulberry
Street.

Her successor, Ken Marino, was forced out of his job at the Board of
Elections earlier this month following a disciplinary hearing after being
implicated in a plot to forge signatures on nominating petitions.

Now comes word that an official in the privately organized Little Italy
Merchants Association - formed last year after Compoccia's Little Italy
Chamber of Commerce was dissolved - has been snared in a major
drug-trafficking investigation.

John Delutro, who runs the Cafe Palermo, was arrested Dec. 6 by members of
a joint FBI and Drug Enforcement Administration task force that spent more
than a year tracking drug deals in Little Italy.

He was indicted in the case last Wednesday.

Delutro, who is described by feds as a soldier in the Gambino crime family,
is charged with participating in a conspiracy to buy 50 kilograms of
cocaine and 50 kilograms of heroin from an undercover DEA agent and a
confidential informant who often wore a recording device.

Incredibly, Delutro had been prosecuted on drug charges and sent to prison
in 1984 - by Giuliani. He is currently under federal supervision in that case.

In affidavits filed by the government in Brooklyn federal court, agents
describe a number of discussions Delutro had about heroin and cocaine
transactions earlier this year at the Cafe Palermo with Robert Kapinos, who
they say is an associate of imprisoned mobster Joseph John Chilli III.

In one conversation cited, agents said "Delutro told Kapinos that he could
buy only three kilograms at that time because his 'friends' had gotten
'fat' during the San Gennaro Festival . . ."

The reference apparently was to drug purchases made at or during the feast,
officials told The Post.

City officials indicated there would be no street permit issued next summer
for the Mulberry Street mall if the charges against Delutro stick.

But the fate of the mall could be imperiled even without him because the
president of the merchants' group is Robert Ianniello Jr., who, with his
father, runs the legendary Umberto's Clam House.

Ianniello is the nephew of mob capo Matty "The Horse" Ianniello.

Robert Ianniello last week filed for a permit to run the annual Mulberry
Street pedestrian mall, which operates from Memorial Day to Labor Day.

City officials said they will evaluate his application and rule on it like
any other permit request.

"There's no reason to keep him out just because of his name," said Tony
Carbonetti, the mayor's chief of staff. "We will take him at face value."

But Ianniello was turned down for a sidewalk cafe permit last year. It
wasn't immediately clear why. Neither he nor his publicist returned phone
calls.

Friends describe Ianniello as a legitimate businessman who shouldn't be
tarred by of the notorious pedigree of his seafood restaurant, which moved
two blocks north from its original location a couple of years ago.

"Because somebody got shot in a restaurant doesn't make you a criminal,"
said one worker at the eatery.

Colombo-family crime boss Joseph "Crazy Joe" Gallo was gunned down inside
Umberto's on April 7, 1972, while celebrating his 43rd birthday.

The federal government seized the original Umberto's in 1987 and forced it
to operate under a monitor until 1994 after Matty Ianniello was accused of
skimming revenues from its operation for the mob.

The court action was begun by then-U.S. Attorney Giuliani.

Delutro's lawyer, Arnold Kriss, refused to comment on the current case.