August 23, 1987

Twelve union officials, seven construction contractors and a site supervisor were indicted last week on charges of bribery, extortion and bid-rigging that prosecutors said had imposed a "racketeering tax" for years on the construction industry in Queens.

The indictment did not mention organized crime, but Edward A. McDonald, the head of the Justice Department's organized crime strike force in Brooklyn, said the case "presents a problem of labor racketeering in its darkest form - an important industry that is in a virtual stranglehold of segments of organized crime and a group of labor racketeers and their willing business accomplices." He added that the pattern of corruption outlined in the indictment, amounting to a surcharge of millions of dollars yearly on new residential and commercial properties, "goes on all the time throughout the city of New York, throughout the metropolitan area."

Chief among the defendants is a 75-year-old former business agent of Mason Tenders Local 13 of the Laborers' International Union of North America, Basil Robert Cervone, described by Mr. McDonald as having "acted as a corrupt clearinghouse, or an ombudsman if you will," for extortion by union officials and bid-rigging among the contractors.

One scheme, according to the indictment, involved an unsuccessful attempt in late 1985 to rig bids for masonry work on luxury boxes at Shea Stadium. And some of those indicted were charged with using "various minority worker groups" to threaten, harass and impede contractors unless they made payoffs to the unions.

One union official was still being sought; the other defendants pleaded not guilty. Prosecutors said that about 90 convictions or guilty pleas had been obtained since the strike force and the F.B.I. began their investigation of corruption in the New York City building industry in 1978.