FOR IMMEDIATE RELEASE                                         TAX
FRIDAY, JUNE 7, 1996                               (202) 514-2008
                                               TDD (202) 514-1888

             FORMER ORGANIZED CRIME FIGURE SENTENCED
             IN MILLION DOLLAR FUEL TAX FRAUD SCHEME

     WASHINGTON, D.C. -- Lawrence M. Harrison, whose scheme to
avoid paying excise taxes on gasoline generated an estimated $1
billion for himself and mob figures in the 1970's and 1980's, was
sentenced to 188 months in prison and ordered to pay $442,000 in
restitution today for a tax fraud in Dallas, the Justice
Department announced.  
     The sentence was imposed by U.S. District Judge Sidney A.
Fitzwater in Dallas after Harrison was convicted in March 1996 on
motor fuel excise tax evasion, conspiracy, wire fraud and money
laundering charges that cost the federal government more than $1
million in lost fuel taxes in that one case alone. 
     In sentencing Harrison, Judge Sidney A. Fitzwater of the
U.S. District Court in Dallas upwardly departed from the
sentencing guidelines based on Harrison's obstructive conduct.
     "Today's sentence sends a message to the motor fuels
industry that the Internal Revenue Service (IRS) and Tax Division
remain fully committed to investigating and prosecuting those in
the industry who commit frauds against the government and the
public," Loretta Argrett, Assistant Attorney General for the Tax
Division said. 
     Harrison and four co-defendants--his two sons, Lawrence J.
and Joseph M. Harrison, his daughter, Susan Mulry, and a family
friend, Peter F. Raneri--were indicted in December 1994 after an
investigation by the IRS's Dallas District Criminal Investigative
Division.      
     Evidence at trial showed that Harrison, who entered the
Witness Security Program in the mid-1980's, and his co-
conspirators purchased a small Louisiana corporation, Hebco
Petroleum, Inc., in 1988 to enter the Dallas/Ft. Worth wholesale
diesel fuel and gasoline markets.  They won customers by pricing
Hebco's fuel well below acquisition costs.  Although Hebco's
invoices stated that state and federal taxes were included in the
price, the company in fact did not pay state and federal taxes,
but kept the revenue itself.
     From June 1989 through January 1990, Hebco grossed
approximately $26 million in fuel sales.  Between October 1989
and January 1990, Hebco transferred approximately $3 million from
Texas bank accounts to a Cayman Islands account from which it was
forwarded to European bank accounts to fund a scheme to defraud
the Belgian government of petroleum tax revenues.  
     The Hebco group also defrauded its Louisiana financial
backers and Fina Petroleum and Chemical Company, a Dallas
petroleum distributor, of $438,000. 
     Following his 1993 indictment by Texas for the Hebco scheme,
Harrison, then a Florida resident, fled the U.S., and remained in
hiding until his arrest in January 1995 in Washington State,
where he was involved in yet another motor fuel tax fraud scheme.
     In the late 1970's and early 1980's, Harrison, then known as
Lawrence S. Iorizzo, conceived and developed so-called motor fuel
excise tax evasion "daisy chain" schemes for organized crime
groups in New York and Florida.  To confuse state and federal tax
auditors, Harrison employed a maze of shell corporations, false
paper trails and offshore bank accounts.  Harrison estimated the
schemes yielded approximately $1 billion in stolen taxes for
himself and organized crime figures in New York.
     In 1984, Harrison, who was convicted of mail fraud and wire
fraud relating to a fuel tax evasion scheme in New York, fled to
Panama prior to sentencing, allegedly after receiving death
threats from his organized crime associates.  He returned to the
U.S. later that year and entered the Witness Security Program
under an agreement with the Organized Crime Strike Force for the
Eastern District of New York.  When his convictions were over-
turned in 1986, Iorizzo subsequently pleaded guilty to federal
mail fraud and to a violation of Florida's organized crime
statute.  
     Harrison's sons and Raneri testified at Harrison's trial as
government witnesses following their guilty pleas in the Hebco
scheme.  His daughter, Susan Mulry, also pleaded guilty but did
not testify.                  
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