Federico Righetti is a leading figure of the Masucci Crime Family. When he solicited Cary Stillman to kill bookie Jerry Tortino, the Manhattan District Attorney's Office took the case. Federico's nephew Peter also gave Federico up from wanting to usurp his uncle.
The FBI ensured the case was thrown out, so Federico was their witness. But in the end, Peter ordered the killings of Federico and his nurse. It's highly implied the FBI saw the risks and let it happen to eliminate the threats Federico posed. (L&O: "Payback")