Vito Roberto Palazzolo (; born 31 July 1947) is an Italian businessman previously living in South Africa. Born in Terrasini, he moved to South Africa in the mid-1980s. He also goes by the name Robert von Palace Kolbatschenko. He is alleged to be a member of the Sicilian Mafia, an allegation he denies. Il boss finanziere della mafia , Antimafia Duemila, N° 28, January 2003 In March 2009, the highest court in Italy confirmed a 2006 nine-year sentence for association with the Mafia. Il Sudafrica nega l'estradizione di Palazzolo, La Repubblica, 19 June 2010 Definitiva la condanna per il re del riciclaggio, La Repubblica, 18 March 2009 He is alleged to be a Mafia treasurer linked to Bernardo Provenzano, the Mafia boss arrested in April 2006 in Corleone, Sicily, and his predecessor Salvatore Riina, both serving life sentences in Italian jails. Palazzolo maintains his innocence and claims that he has been persecuted by the Italian government, the press, lawyers, politicians, and "opportunists" for many years.Presumed Guilty, Vito Palazzolo's website (accessed 11 September 2010) On 30 March 2012 Palazzolo was arrested by Interpol at Suvarnabhumi Airport in Bangkok, Thailand. Arrestato Vito Roberto Palazzolo, 'cassiere' dei boss di Cosa Nostra, La Repubblica, 31 March 2012Thailand arrests Vito Roberto Palazzolo, 'South African' mafia banker wanted in Italy, Global Post, 31 March 2012
Money laundering accusations Palazzolo was born in Terrasini, Sicily (Italy). He left home in 1962 at the age of 15 and emigrated to Switzerland. He completed his studies in Switzerland and Germany and started working as a private banker, servicing high-net-worth individuals, and made substantial amounts of money in the diamond trade.Trepp, Swiss Connection, pp. 246–250 In 1982, he founded Consultfin SA with Franco Della Torre, a financial services arm of one of three major Swiss banks in Lugano, Switzerland. The company became a conduit for financial operations of heroin traffickers linked to the Mafia.
Palazzolo first came to the attention of law enforcement in Italy and the United States in the course of money laundering activities in the Pizza Connection heroin trafficking ring between Turkey, Sicily and New York.Powis, The Money Launderers, pp. 16/21/28 Italian and US intelligence officers estimate that Palazzolo was involved in a network that laundered more than US$1.6 billion in drug money through Switzerland.Gaetano Badalamenti, 80; Led Pizza Connection Ring, The New York Times (Obituary), 3 May 2004 Some of the money was moved by Palazzolo through offshore companies and fronts from 1979 until his arrest in Lugano (Switzerland) on 20 April 1984, on an international arrest warrant from Italy.
The Swiss Criminal Court in Lugano sentenced Palazzolo in September 1985 to a three-year prison term for money laundering, after establishing he was in control of some of the accounts where money raised from the heroin sales were deposited. 'Pizza connection' tre le condanne e una assoluzione, La Repubblica, 27 September 1985Top cop backs Mafia man, Mail & Guardian, 12 December 1997Palazzolo: The mobster from Burgersdorp, Mail & Guardian, 19 November 1999 The Court established that Palazzolo and his partner Franco Della Torre moved 6 million dollars in 1982, half of which was converted into 200 kg. of gold for Mafia boss Antonio Rotolo, who seriously threatened Palazzolo to return him the money when the latter was warned that the FBI was investigating the suspicious money transfers.Sentence by the Criminal Appeal Court of Lugano, No. 130-162(88), 26 September 1985 Palazzolo "participated in the financing of the illegal trafficking of narcotics and served as intermediaries in its financing, making the necessary preparations and contributing in this way to dealing in considerable quantities of morphine base, which were shipped by sea from Turkey to Southern Italy, where it was processed into heroin, and from there sent to the USA for sale to consumers."
The appeal court increased the sentence to five-and-a-half years in April 1986. "Pizza Connection"-Mitglied in Südafrika verhaftet, Neue Zürcher Zeitung, 4 February 1988 Schmutzige Wäsche, Der Spiegel, 12 May 1986 In 1993, the Bundesgericht in Bern reduced the sentence to three years and nine months, for having acted in "dolus eventualis", which is a legal interpretation of reckless disregard, somewhere between intent and negligence.Dolus at legalcity.net
In Italy, he was charged for the same offences in the procedures against the Italian end of the Pizza Connection. An arrest warrant was issued in April 1984 by prosecuting magistrate Giovanni Falcone requesting Palazzolo's extradition. The extradition was refused because he was already on trial before the Swiss courts. In March 1992, a criminal court in Rome convicted Palazzolo for the crime of "association with the purpose of financing for narcotics trafficking" and sentenced him to two years. He was acquitted on the charge of Mafia association, however, because the fact "did not exist". The conviction was suspended because Palazzolo had already served three years in prison in Switzerland for the same facts.Review application before Appeal Court of Caltanissetta, by the defence lawyers of Palazzolo, 25 November 2010
At the time, the United States Federal Bureau of Investigation (FBI) considered him to be one of the top seven in the Sicilian Cosa Nostra.FBI names Palazzolo as Cosa Nostra don, Mail & Guardian, 12 October 1998Palazzolo top mafioso – FBI, Daily Dispatch, 13 October 1998 However, he is never mentioned as a member of the top echelon of Cosa Nostra in court sentences and academic studies. State witness Antonino Giuffrè claimed that the Sicilian Mafia's interests in the drug trade in Venezuela, Brazil, Mexico, Canada and the Far East were managed by Palazzolo.Mafia's link to Colombian cartel is revealed, The Independent (London), 11 December 2004 Giuffrè's claim could not be substantiated.
Escape to South Africa While on 36-hour parole from a prison in Switzerland, he absconded to South Africa on a false passport – obtained from a fellow inmate at a prison in Lugano, Switzerland – and a holiday visa in December 1986.Charges against Palazzolo dropped, Mail & Guardian, 14 September 2001 Palazzolo travelled to the Eastern Cape, where National Party parliamentarian Peet de Pontes for East London had organised Ciskei residence for him. Palazzolo acquired Ciskei citizenship and a new name: Robert von Palace Kolbatschenko, claiming aristocratic German lineage, born in Burgersdorp. On the strength of a new passport in this name, he obtained resident status in South Africa – but all files relating to the application are missing.Palazzolo's file disappeared in 1980s, Cape Times, 25 April 2012
The former Ciskei ambassador plenipotentiary, Douw Steyn, told the Harms Commission which investigated the so-called "Palazzolo affair" that Ciskei law had been specially amended to accommodate Palazzolo on condition he donate money to the homeland.
After inviting a Home Affairs official to his farm at Franschhoek, Palazzolo was granted a South African residence permit in December 1987. By January 1988, Swiss police had traced him and informed their South African counterparts. The South African Narcotics Bureau (Sanab) raided Palazzolo's Franschhoek farm, Terra de Luc, and arrested him – seizing 10 guns and diamonds worth 500,000 Rand together with documents indicating that Palazzolo had invested more than 25 million Rand in businesses in South Africa and Namibia. He was declared an undesirable person in South Africa and returned to Switzerland to complete his jail sentence.
After being released from jail, Palazzolo returned to South Africa in late 1989 to testify against De Pontes, who was convicted in November 1990 for helping Palazzolo obtain South African residence. De Pontes was fined R35,000 after being convicted of charges including fraud, forgery, and bribery, all linked to Palazzolo's stay in South Africa. After testifying about his own fraudulent residence application, Palazzolo stayed in South Africa until late 1991, when he was ordered out of the country by the Department of Home Affairs.
De Pontes maintained he was wrongly convicted – saying former minister of foreign affairs Pik Botha threatened in 1988 to "destroy him" after a photograph of Palazzolo and Botha together at an NP function was published in a newspaper. De Pontes said among the deals he and Palazzolo worked on was a 1987 sanctions-busting attempt to import submarines and jet fighters for the apartheid regime.'SA mafia' fears Vito's arrest, Mail & Guardian, 19 November 1999
Political contacts In 1992, Palazzolo was reportedly living in a residence in Ciskei belonging to then-military ruler Oupa Gqozo, but he was soon back in South Africa. The Cabinet, headed by president Frederik Willem de Klerk, approved a new South African residence application in March 1993, although at the time Palazzolo was the subject of an Italian extradition warrant, according to the magazine Africa Confidential. In September 1993, De Klerk's government issued a passport to Palazzolo.Nats were in bed with Mafia boss, Mail & Guardian, 5 February 1999Men of honour, Africa Confidential, 40(3), 5 February 1999
According to some sources, Palazzolo allegedly blackmailed former foreign minister Pik Botha with photographs showing Botha in a compromising position in bed with a black woman. The photographs are said to be in the possession of the National Intelligence Agency (NIA).Did Palazzolo blackmail Pik?, Mail & Guardian, 9 October 1998 Botha has said the claim was "absolute rubbish" and threatened a R10 million lawsuit against the Mail & Guardian., Daily Dispatch, 15 October 1998'It's rubbish' – Pik Botha, Mail & Guardian, 16 October 1998
Business interests Palazzolo quickly ingratiated himself with the National Party when he arrived in South Africa in 1986 and also successfully wooed many in the African National Congress (ANC) long before Mandela's party won the 1994 election, which definitively ended the Apartheid regime.Mafia man free ... for now, Mail & Guardian, 3 July 1998 Palazzolo established businesses in Southern Africa, ranging from bottled water to diamond prospecting. His interests are represented either through his sons Christian and Pietro or through the Von Palace Kolbatschenko Trust. The trust, with offices in Cape Town, is affiliated to Palazzolo's Cape International Holdings, registered in the British Virgin Islands.
Among the approximately 20 companies allegedly linked to him are Anglo-Cape Diamonds, Von Palace Cutting Works and La Vie Mineral Waters. One big foreign deal involved taking a 15% stake in a valuable Angolan diamond concession. Since a tax audit on him started in September 1997, he has argued that his only business enterprise in South Africa is the Franschhoek farm and that he has no other tax liabilities in the country.
South Africa Investigations into Palazzolo restarted in 1995 when police in the Cape received inquiries from Italian police, who were after Mariano Tullio Troia, a Sicilian mafioso wanted for the murder of Salvatore Lima, an associate of former Italian prime minister Giulio Andreotti. A March 1998 briefing compiled by Western Cape police intelligence said Italian police claimed Troia was being harboured by Sicilian Salvatore Morettino, a naturalised South African citizen living in Houghton. The Italian police also gave information of contact between Palazzolo and a prominent Sicilian mafia boss, Giovanni Brusca, convicted in Italy for the murder of Antimafia prosecutor Giovanni Falcone.