Columnist Jeff German: Family hopes for Panaro’s release

Friday, Aug. 3, 2001 | 4:49 a.m.

Jeff German is the Sun's senior investigative reporter. He can be reached at (702) 259-4067 or by e-mail at german@lasvegassun.com

FEDERAL prosecutors call Robert Panaro a feared member of the Buffalo mob, someone who's capable of approving a gangland hit.

But to his family members, Panaro is anything but a hoodlum.

They see him as an upstanding citizen who has been earning an honest living -- that is until he got caught up in an FBI racketeering investigation that smashed an attempt by the Los Angeles and Buffalo crime syndicates to take over Las Vegas street rackets.

Panaro and another man, Stephen Cino, a reputed member of the Los Angeles mob, were found guilty of muscling in on the loan-sharking and insurance fraud operations of Herbie Blitzstein, a longtime Las Vegas underworld figure.

Blitzstein, once a top lieutenant to slain Chicago mob kingpin Anthony Spilotro, was killed in January 1997 as the plot was carried out right under the nose of FBI agents pursuing the massive racketeering probe.

Both Panaro and Cino were charged in the conspiracy to kill Blitzstein, but were acquitted at their May 1999 trial. The FBI's own tapes showed that Panaro and Cino were not interested in wanting to see Blitzstein dead.

But the two men were convicted of conspiracy to commit extortion against Blitzstein. The jury that found them guilty saw plenty of evidence in that scheme.

Today the 59-year-old Panaro is serving the remaining months of a 7 1/2-year sentence at a federal prison outside Bakersfield, Calif. The sentence stems from the extortion conviction in the the well-publicized racketeering investigation.

It's the first time Panaro has ever been in prison, and now his family and lawyers are hoping to persuade U.S. District Judge Philip Pro to shave two years off of his sentence, which could earn his early release.

In May Pro amended Panaro's judgment of conviction from an erroneous extortion count to conspiracy to commit extortion.

Panaro's lawyer, Chris Rasmussen, then filed court papers asking Pro to change Panaro's sentence. He pointed out that the new judgment required Pro to hand out the lesser prison time under federal sentencing guidelines.

"As a result of this correction, Mr. Panaro's sentence would be reduced by approximately 26 months, leaving approximately 11 months of incarceration," Rasmussen wrote.

Federal prosecutors saw things differently and opposed the motion.

A similar issue arose before Pro a couple of years ago in another underworld case, and the judge ruled he didn't have authority to hand out a lesser sentence.

In his opposition papers, Assistant U.S. Attorney Eric Johnson argued that federal laws prohibit a judge from correcting a sentence unless it's done within seven days of the original sentencing.

Johnson also said he doesn't believe that Pro even has jurisdiction now to modify Panaro's sentence. The extortion case is on appeal at the 9th U.S. Court of Appeals in San Francisco.

Pro, however, sided with Rasmussen and concluded he does have authority to take a look at changing Panaro's sentence. He scheduled a Sept. 14 hearing on the matter and asked both sides to thoroughly brief the issue.

The judge also ordered federal prosecutors to bring Panaro to Las Vegas for the hearing.

Prosecutors already are gearing up to show Pro that Panaro deserves the extra time behind bars.

Still, the news of the upcoming hearing has excited Panaro's close-knit family, which continues to throw its support to him in prison.

Though the Blitzstein case is over, and others are doing prison time for his slaying, the nightmare continues for Panaro's family members.

It's not likely to end until they see him out of prison.