Reputed mob associate admits to terrorizing suburban man to collect debt

A reputed Chicago mob associate pleaded guilty Wednesday to beating a suburban man and having his garage and van torched to collect $100,000 in interest on juice loans.

Robert Panozzo Sr., 59, lent his victim $40,000 in 2005 and made additional loans to him. In 2006, they met at a Palatine restaurant, and the man handed Panozzo an envelope stuffed with $25,000 in cash, thinking his debt was satisfied.

But Panozzo demanded an additional $100,000, saying, “This is serious. I want my money,” according to federal court records.

Panozzo recruited an associate, Joseph D. Abbott, to collect the debt. In 2006, Panozzo and Abbott went to the man’s business in McHenry County, and Panozzo and others beat him up.

Then in 2009, Panozzo paid Abbott $1,000 to set fire to the victim’s Dodge Caravan, which was sitting in his driveway. Panozzo later paid Abbott more than $4,000 to “blow up” the man’s house. Abbott torched the man’s garage, according to the feds.

Abbott, 40, is awaiting sentencing. In 2016, he wrote a letter to the court saying he no longer wished to testify against Panozzo because “cooperating could get me seriously injured or even killed.”

Federal prosecutors are recommending a prison sentence of 11 to 14 years for Panozzo for extortion.

But they’ve also recommended that Panozzo’s sentence run simultaneously with an 18-year sentence he got in Cook County Criminal Court for trying to rob a drug cartel stash house that was actually part of a sting operation.

Panozzo pleaded guilty to a state racketeering charge in that case in January. He and his accomplices were accused of carrying out home invasions, armed robberies, burglaries and prostitution.

In 2013, he allegedly cut off the ear of a home-invasion victim. Panozzo was furious because he heard the man speaking English after he claimed he could only speak Spanish, authorities said. He allegedly stole more than 25 kilograms of cocaine and two cars in that caper.

Panozzo’s name surfaced in the 2014 trial of former Chicago Police Officer Steve Mandell, who was sentenced to life in prison for plotting to kidnap, kill and dismember a suburban businessman.

The star witness, former North Shore banker George Michael, said Panozzo introduced him to Mandell over lunch at La Scarola restaurant on West Grand Avenue. The FBI recorded the meeting.

Sources say Panozzo is connected to the Chicago Outfit’s West Side crew based in “The Patch” along Grand Avenue just west of the Loop.