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Lorenzo Giordano, a leader of The Montreal Mafia's Gambling Operation

Stewart Goldstein once agreed that owing the  Montral Mafia $1.6 million for sports gambling  debts  was “a  joke” to him.

But the self-admitted high-stakes gambler was not in a laughing mood yesterday when he testified during a sentence hearing in a case where he pleaded guilty to defrauding the Bank of Montreal of $600,000.

Goldstein, who is missing an eye and goes by the name Stewey, told Quebec Court Judge Claude Parent he was merely “the face” on a fraud allegedly carried out by the Mafia with the help of a bank employee.

Goldstein and his lawyer Gary Martin described a scenario in which Goldstein was facing a $1.6-million debt generated after months of gambling on an Internet sports gambling network controlled by the Mafia. Unable to even pay the interest on the debt, he agreed to take part in a crude fraud scheme in which he would assume most of the risk.

At first Goldstein, who describes himself as “an excellent handicapper” won big off the gambling network -“millions,” he said. But he failed to listen to the sound advice in the Kenny Rogers song, The Gambler, and didn’t know when to walk away.

Goldstein hit a bad streak that landed him in debt. At one point he was summoned to a meeting, in July 2004, with reputed Mafia leaders Moreno Gallo, Francesco Del Balso and Lorenzo Giordano at the Consenza Social Club. Del Balso and Giordano were being investigated in Project Colisee at the time and microphones had been hidden inside the mob’s headquarters to record conversations. At one point in the meeting, Del Balso joked with Goldstein that “$1.6 million should be a joke for you.”

Goldstein agreed and said he had lost millions over the previous years. Giordano in particular was upset with the high life Goldstein appeared to be living and noted that he drove around in luxury cars while owing serious money.

Goldstein and Martin said yesterday that by February 2006, with the debt still not paid, people “in the organization” arranged to have $1 million transferred to an account Goldstein had with the Bank of Montreal. Martin said evidence presented before Goldstein pleaded guilty to fraud shows an employee at one of the bank’s branches in Granby facilitated a bogus transfer of shares in a company based in the Eastern Townships to Goldstein’s account. It took the bank hours to figure out the ruse and by that time Goldstein had withdrawn $600,000 and given the cash to people who were, at that point, threatening his life.

The debt came with an interest rate of four per cent per week. Goldstein said that alone ate up everything he could make to pay the actual debt.

“I was put against a wall, sir,” Goldstein told Parent.

Days after the fraud was committed, a SWAT team raided Goldstein’s home in Baie D’Urfe and found several firearms. Goldstein has already been sentenced to a $50,000 fine for four weapons-related offences.

Prosecutor Nathalie Fafard, who is seeking a 30-month prison term for the fraud, told Parent the firearms are a further sign of the kind of life Goldstein leads.

“We get to choose our friends,” and Goldstein chose to hang out with members of organized crime, Fafard said. “We are not talking about the good father of a family here.”

“I haven’t been an angel all my life but I haven’t held up banks,” Goldstein countered. He said the firearms were given to him as gifts by people he associated with in the gambling world.

“When someone from the Hells Angels gives you a Mack 10, you don’t say ‘No, I’d rather have a (smaller calibre firearm),” he said.

Martin asked for a conditional sentence based on a plan Goldstein has arranged to pay the bank back. He said Goldstein has repaid almost $300,000.

Parent will decide on Feb. 14 whether to render a sentence or delay the case while Goldstein continues to pay back what he owes.