Three Accused of Fraud Over Stock Transfer

Two reputed organized crime figures--including a Newport Beach man--and a third man who runs an investment firm have been indicted by a federal grand jury on charges they schemed to defraud General Enertech Corp. stockholders by illegally transferring hundreds of thousands of shares of the firm’s stock.

A seven-count indictment, sought by the Justice Department’s Organized Crime Task Force, named Michael A. Rizzitello, 59, of Canoga Park, and Robert George Paduano, 43, of Newport Beach. Also named in the indictment was Nicholas Nardi, 66, of Chatsworth.

The indictment accuses the three of securing the fraudulent transfer of more than 400,000 shares of Montana-based General Enertech in 1981 by bribing an official of a stock registration and transfer firm, then selling the stock for about $144,000.

Tico Financial, a Tustin firm headed by Paduano, received 11,000 shares of Enertech, and another 200,000 shares were transferred to Tangible Investments Inc., headed by Nardi, the indictment charged.

Reputed Mafia Leader

Rizzitello, a reputed West Coast Mafia leader, is now serving a federal prison term in Texas for trying to take over Los Angeles’ pornography and bookmaking trade. He was convicted of racketeering, extortion and conspiracy charges in 1980, along with four other Southern California men believed by federal prosecutors to be in the upper echelons of the Los Angeles Mafia.

Paduano was linked to organized crime in a 1978 report by the state attorney general’s office, and was convicted of arson in 1973 and conspiracy to distribute cocaine in 1977, authorities said.

The current indictment stems from a two-year investigation. Three others indicted last year in connection with the case were convicted in February after an eight-week trial in Los Angeles federal court.