company, is to use their political connections to get a fare raise.
That enhances the stock on the market, then they unload.
They buy into some companies to get enough stock to rig the price,
a felony. In at least one instance with which we are familiar, the
underworld put a representative in as an officer of a transportation
company. He then sold company stock short on the securities exchanges.
This is a violation of SEC law. When a complaint was made by other
stockholders to the SEC, the man they talked to shrugged his shoulders
and said, “Forget it. They have a fix.”
Operators with such tremendous financial interests know their way
around Washington. One of their chief sources of contact is through
Democratic county, state and national committeemen, who are beholden
for campaign contributions. Sometimes cash is handed over to sweeten
the kitty. The committeemen and political bosses pass the orders along
through their Congressmen in Washington, or, when the fix is important
enough, directly to a specialist at such affairs right in the White
House.
The Tammany and Flynn interests in New York and Jake Arvey’s tight
Chicago combine are powers. The Rhode Island organization of Senator
Pastore and Attorney General McGrath, the crooked Connecticut machine
that made Senator Brien McMahon, and the Maryland organization, about
which more later, get whatever they want. Senator Herbert O’Conor
is the godfather of the Maryland outfit, and he is a member of the
Kefauver Committee.
The Colorado machine handles the loot for the Mountain States. The
errand-boy for the West Coast gamblers, dope runners and procurers
is the California Democratic organization, of which at this writing,
Jimmy Roosevelt is the chairman, but the mobsters don’t stick long with
losers.
In _Chicago Confidential_ we gave an outline of the organization and
chain of command of the international underworld Syndicate.
The Mafia, an age-old institution, has existed in Sicily since before
the beginning of written history. Sicily always has been, and to this
day is, subject territory. It was owned by ancient Phoenicians, Greeks,
Carthaginians, Romans, Imperial France, Italy and even Britain. The
Sicilian peasants always worked for absentee owners.
In prehistoric times, the Mafia began as a patriotic terrorist society,
somewhat like the Irish Republican Army. Venal leaders sold out,
offered protection to some estates while they sacked others. They
anticipated the protection racket by centuries.
The Mafia and the dread Black Hand are the same thing. The black hand
was the sign over which the Mafia’s threats were delivered. During
several thousand years it came about that almost every native of Sicily
had to have some tie or connection with the Mafia. Some were members,
others were relatives of members, or partners, hired killers and
spies. Others did business with it; still others were the terrorized
unattached who dared not refuse its bidding.
Sicilians vie with Cantonese as the most migrating people in the world.
Sicily, like Canton, is overpopulated and poverty-ridden. Another, more
important factor, appears to be that at every change of government,
Mafistas were forced into flight and exile in droves. They settled and
colonized all over the earth. There are huge Sicilian colonies spread
around Europe, in England, South America, North Africa, the Orient and
the United States.
Every Sicilian colony had a hard core of black-handers, who set up an
invisible government and preyed first on the other colonizers. The
various groups were in correspondence with each other, cooperated in
business deals, provided places for other fugitives and expatriates.
The first great influx arrived in this country exactly a hundred years
ago, about the time Napoleon 3rd extended his influence to Sicily.
Thereafter, every ten or twenty years found other large groups on
their way here, especially after such periods of uncertainty as the
unification of Italy, World War I, the Mussolini ascendancy, and after
World War II. From time to time the Italian government tried to wipe
out the Mafia, and after each attempt thousands more came to wink and
leer at the Statue of Liberty.
Though the Italian government never could exterminate the Mafia, it did
wipe out similar terroristic societies on the mainland, such as the
Camorra, of Naples. The members of these other secret societies who
could escape fled to Sicily, where they were welcomed and integrated as
brothers by the Mafistas.
Their overseas affiliates were absorbed by local Mafia units. This
process took place also among outlawed Greek secret societies, and the
dread Black Hand of Serbia, which was akin in purpose to Sicily’s Black
Hand. Meanwhile, as Mafia bosses got fat and rich, they smuggled in new
killers, many from Cuba and Puerto Rico.
The American Black Hand was content to operate exclusively in Italian
circles for years. All Italians had to pay tribute, a tithe of their
earnings, from the dollar-a-week of the corner bootblack to five
thousand a night of Enrico Caruso. Failure to pay meant the Black
Hand letter, and continued failure, death. Now the Mafia is smoother.
It “owns” acts on a ten-per cent business deal. Frank Sinatra was
discovered by Willie Moretti and is the pet of the Fischettis. He gave
a gold cigarette case to Charlie Luciano, inscribed “To my friend.”
Recent developments in New York again demonstrate how this works.
A $4,000-a-year city fireman, an Italian who had changed his name,
testified he was operating a $200,000 talent agency, which, in
theatrical parlance, “stole” acts from other agencies. Two were
“thefted” from agent Lou Perry: Alan Dale, another Italian who is the
hottest crooning find of the year, and Toni Arden. The fireman, whose
name is Gerry Purcell, booked these two and another, Terri Stevens,
into the Copacabana, where all three “clicked” and started their climbs
to fame.
In _Chicago Confidential_, we described how Big Jim Colosimo, then
the local Mafia leader, set up the organization which under Al Capone
and Johnny Torrio, was able to drive out of Chicago all the competing
non-Italian and sectional mobs. Prohibition made them fabulously rich
and potent.
The same thing happened in New York. While Colosimo was the head of the
Chicago chapter, Lupo “the Wolf” Saietta headed the New York branch.
After he went to prison, Joe “The Boss” Masseria took over, after a lot
of mayhem.
They began to call the Mafia the Unione Siciliano then. At times it
tried to pretend it was a respectable Italian-American benevolent
society. Joe “The Boss” reigned at the top of the Unione for nine
years, until he was murdered in 1931. His chief lieutenants were
“Lucky” Luciano and Frank Costello. When Masseria was killed they moved
in.
The Irish and Jewish mobs were being driven to the wall. The same
thing happened in every important city. By the middle 1930s, the
Unione Siciliano was dominant in every racket. Wherever there were
non-Italians left, the only way they could do business was to accept
the overlordship of the Mafia. If they were good boys they were allowed
to come in and get rich. If they tried any monkey-business, they were
assassinated, like Bugsy Siegel, or turned over to the law, like Lepke
and Gurrah.
No one knows whether the top Italian hoodlums like Capone, Luciano and
Costello took over the Mafia, or whether the Mafia took them over. That
is an academic conjecture, as they are now one and the same thing, with
the worldwide facilities of the Unione Siciliano the nucleus on which
all organized vice, crime and corruption, not only in the United States
but all over the world, has been built.
In _Chicago Confidential_, we stated in passing that since the exile
of Luciano in Italy the American “president” or executive head of the
Unione Siciliano is Frank Costello, and the vice-president is Capone’s
cousin, Charles Fischetti, in Chicago.
The worldwide Mafia is composed of a supreme head in Palermo, Sicily,
a Grand Council consisting of high-ranking executives, subordinate
officers, and a global membership.
Luciano, following his deportation in 1947, has been installed as the
Supreme Head of the International Mafia. Members are divided into two
distinct groups, inner circle and outer circle. The latter includes
members of ordinary rank and standards. The former consists of those
who command wealth, influence or proven underworld power. Membership in
this group is kept at a minimum, since it derives a major portion of
all proceeds from its general diverse illegal enterprises.
Members of the elite few are almost invariably, through ancestry
or direct birth, from Palermo and its adjoining areas. A very few
non-Italians have been taken into the ruling circle. According to the
U.S. Bureau of Narcotics, American members of the Mafia are necessarily
members of the over-all group, which therefore has continued to
include former American gangsters who left the U.S. by deportation or
voluntary flight. Prominently mentioned among these are John Schillochi
(International List 298); Dominic Petrelli (International List 259);
and Nicola Gentile (International List 133), all of whom were in Italy
when last heard of, though informants tell us they have since been seen
around New York again.
Other important members of the Mafia, such as Francisco Paolo Coppola
and Sylvestro Carrolla, found their way to Mexico, where they took over
the local Mafia. Other lesser figures represent the fearsome fraternity
in Canada, Argentina, Brazil, France, and England.
The Bureau of Narcotics has compiled what is believed to be the
only master list of the inner circle of the Mafia. It is based on
documentary evidence in the form of address books, papers, interstate
telephone calls, police records, screened informants, etc. During the
recent Kefauver Committee hearings, Commissioner Anslinger supplied
the document under oath to the committee. Extracts from this list are
printed in the back of the book.
Even before the Mafia had organized the entire American underworld, it
had strong communication lines into Washington. These were first built
up during Prohibition, when the boys passed money back to the capital
for their own protection. They also made liberal contributions to the
campaign funds of dry Congressmen, without whose votes, for whatever
cause, the racket was worthless. During the insane days of Prohibition,
the underworld began the process of undermining the honesty and probity
of federal officials, which has since been carried to an extreme.
Until the 18th Amendment, law-breakers feared Uncle Whiskers. There
were few federal criminal laws. Most criminals didn’t want to tangle
with Washington. Only nuts got themselves mixed up with the postal
inspectors or the Secret Service. After the wholesale bribery and
corruption of the 1920s, all respect for national law enforcement had
gone into the ashcan.
Now, due largely to the example of the F.B.I., the Bureau of Narcotics
and the Treasury Intelligence, the public’s faith in federal
law-enforcement and investigative agencies has been revived, but
the prosecuting and judicial ends have never come back. Most felons
would rather be arrested by federal than state or city cops, because
they know they can make a better deal with the prosecutors, and if
everything fails, federal sentences are light and the prisons are soft.
Before the underworld was completely organized, Washington was a
“neutral” city, where mob meetings and conventions were held. In such
cities the delegates must not pack guns. Rough stuff is out by common
consent. Other such open cities are Saratoga, Hot Springs, Las Vegas,
Atlantic City and Miami. These were and are important resort centers,
and are kept neutral because machine-gunning might scare tourists away.
Washington was no-man’s-land for obvious reasons; they knew tommy-guns
wouldn’t be tolerated in the Capitol’s shadow.
Commissioner Anslinger recalls such a gangster convention in the
Shoreham Hotel, two decades ago. The Commissioner dropped into the
Blue Room for dinner and saw Luciano, “Machine Gun” Jack McGurn, Frank
Nitti, “the Enforcer” of the Chicago mob, Izzie Bernstein of Detroit’s
Purple Gang, and three other hoods, each with a bejeweled blonde. They
were registered at the Shoreham under assumed names and spent a week
there holding meetings.
When Anslinger lamped the boys, he went to the lobby and had Lucky
called out. Luciano was offended, beefed about the interruption of his
party. He said, “You can’t do anything to me. We got Constitutional
rights. We’re only sight-seeing.”
Anslinger said, “That’s all you’d better do,” then glancing at the
blondes, he added, “remember the Mann Act.”
A few weeks later, Jack McGurn was knocked off. It developed that this
meeting was called for his trial. He had been getting out of line. So
he was summoned from Chicago to meet his peers from the other cities.
The organized underworld’s influence in official Washington is
incalculable. Its direct ties, even to the top, are so firm that
in many instances even a political revolution will not dislodge
them. They succeeded in doing that which the Communists failed to
do; they infiltrated and took over the government. They are the true
subversives, though that never comes out in Congress.
The Mafia’s power is built around these factors:
1) The underworld’s ownership of and contributions to local political
machines. The mob has no politics or ideology. It pays liberally to
both sides, so it will have a friend in court no matter who wins. Even
the former American Labor Party Congressman, Vito Marcantonio, was on
intimate terms with Mafia hoodlums, accepted campaign contributions
from them, associated with and fronted for their racketeers in New York
and in Washington, and welcomed them into his American Labor Party. He
appointed the son of the infamous “Three Finger Brown” Luchese to West
Point in 1946. Luchese was and is his contact in Tammany Hall.
2) The Mafia’s huge cache of currency, hidden in private safe deposit
vaults and in banks throughout the world. Its earnings from illicit
sources are so great, and come in so fast, the boys cannot invest it
fast enough. They must hide most of the money because they failed to
pay income tax on the major portion of it. It is no exaggeration to say
they have billions of dollars in U.S. bills. With this bankroll they
can bribe at will, elect many officials, and swing public opinion to
incredible degrees.
3) The Syndicate’s interests in countless large legitimate businesses
and industries give it a responsible, respectable voice in Washington
through trade associations, lobbyists, law firms, banks, Congressmen
who would do a favor for a local businessman but would not be seen dead
with a gangster, and a considerable segment of the press, daily and
periodical, and the radio.
4) The hoodlums’ tie-up with some labor, which came about when
unions needed sluggers, or when tough guys muscled in to grab union
treasurers, or used them as part of their extortion rackets. Lobbyists
representing the unions are feared and toadied to.
5) The Italian voting bloc now controls some of the largest cities in
the country. It is the largest single unit in New York, where all three
candidates for mayor in 1950 were Italians. Too many of their men in
office have ties to the Mafia. They can count on the votes of their
countrymen in nominations and elections. The mass votes of Italians
are bartered back and forth and usually can be delivered, by Black
Hand threats in Italian neighborhoods, by appeal to blood relationship
and national pride, or through the pages of powerful Italian language
newspapers.
During his recent campaign, New York’s Mayor Impellitteri charged that
Gene Pope, publisher of Il Progresso Italiano-Americano, the biggest
Italian daily in the country, was an intimate of Frank Costello. We
have seen them dining together on intimate terms.
No book could comprehensively cover the mob’s facets in Washington, but
here are a few, at random:
The President’s military aide and poker pal, Major General Harry
Vaughan, has associated with Frank Costello. They were brought together
through his stooge, the convict John Maragon, who was a pal of the late
Bill Helis, Greek millionaire and partner in Costello’s New York and
Louisiana enterprises--as well as in a Scotch distillery.
Joe Adonis, New York mobster and lieutenant of Costello, had financial
dealings with Harold F. Ambrose, former special assistant to the
Postmaster General. Ambrose pleaded guilty to charges of operating a
$600,000 fraudulent stamp-selling scheme. Adonis was questioned by the
D.C. grand jury, but refused to talk, after which the United States
had amnesia about his connection with the case. Ambrose is related to
Democratic Senator O’Mahoney. His failure to go to trial protected his
underworld associates.
Attorney General McGrath, who may be a U.S. Supreme Court Justice
before this appears in print, was a Senator from Rhode Island and an
important member of Rhode Island’s Democratic machine. That outfit has
tight ties with the underworld. Within days after McGrath was pushed
upstairs to the Attorney Generalship, to make way for Bill Boyle as
Democratic National Chairman, McGrath made a trip to New York City.
There he or his double had dinner at the Copacabana night club with
Joe Nunan, former Commissioner of Internal Revenue, and Julie Podell,
manager of the cafe. It has been frequently charged in New York
that Costello has an interest in the corporation. The late Mayor La
Guardia ordered police to cancel the club’s license if Podell, long an
associate of Costello, was ever found on its premises again. Podell,
while giddy, told one of your reporters that Costello had advanced
$50,000 to open the club.
At the time of the dinner party there, the Copa was a possible
defendant in a tax-action growing out of an investigation into the
charges that it was owned by Costello. Since then, Podell was in Hot
Springs with Costello and several other mobsters from all parts of the
country, in an annual convention. McGrath has since stated there is no
organized crime or vice in the country.
Former Attorney General Tom Clark, now a Justice of the United States
Supreme Court, was closely associated with attorneys who represented
underworld figures. There were no major underworld prosecutions
during his term of office. A Congressional investigation elicited the
startling information that Clark’s boyhood pal, Maury Hughes, a Dallas
attorney, was retained by five members of the old Capone mob, who had
been convicted of extorting millions from the movie industry, to induce
the federal authorities to nol-pros outstanding indictments against
them and secure premature paroles.
Hughes, with other lawyers close to the administration, worked this
feat of legal legerdemain. While these pages were being written,
the same Maury Hughes secretly succeeded in keeping Alan Smiley, a
notorious West Coast gangster who had been ordered deported, in the
country. Smiley was Bugsy Siegel’s buddy, and was seated next to him on
a love-seat in Virginia Hill’s Beverly Hills mansion when Siegel was
ambushed and assassinated, in the only spot in the room visible to the
torpedoes hidden outside, in bushes.
Until recently, Smiley had been passing himself off as an oil broker
and real estate man in Houston, Texas, where he lived with his wife, a
former movie starlet, in Glen McCarthy’s swank Shamrock Hotel. Smiley
took up with a Texas oilman, Lenoire Josey, who liked to gamble. Smiley
said he liked that, too. He knew some good places.
He and Josey went to Sam Maceo’s ornate casino, the Balinese Room, in
Galveston. Then they went to the Mounds Club, in Cleveland. After that
they went to the Flamingo, in Las Vegas. A trip to Phil Kastel’s (and
Costello’s) beautiful Beverly, outside New Orleans, followed. When
Josey counted up he had lost $500,000. Smiley “admitted to being a big
loser, too.” If so, he got some back, because he owns a bit of stock in
the Flamingo.
While these lines were being written, the California Crime Commission,
headed by Admiral William H. Standley, Retired, castigated government
aides for their ties with criminals. He said the relationship between
the underworld elements and certain officials “must of necessity make
it embarrassing for Federal officials to undertake prosecutions.”
A specific example was Sam Termini, described as a godson of the late
Charlie Binaggio, who would have had to earn $900,000 income last year
to be able to afford the cash payments made on his mansion in San Mateo
County. He paid income tax on no such sum.
It cited the case of Dorothy A. McCreedy as a specific example of
tieups between criminals and government officials, stating:
“The McCreedy woman is a convicted madame, a major figure in the
prostitution racket in California for years and operator of two large
whore-houses in Honolulu.”
She was reported to the Income Tax Bureau as a suspected evader, but
“she is also a partner in a business called Safety Step Sales Co., and
one of her partners is Ernest M. Schino, chief field deputy in the
Office of the Collector of Internal Revenue.”
They tell a spicy story about Dorothy, whom we know well--personally,
not professionally. When F. D. Roosevelt made his first trip to Hawaii,
the Secret Service failed to send ahead a black open touring-car
of expensive make, familiar and standard for the President on open
display. Honolulu was winnowed. Only one such car was found in the
Territory. It was owned by Dorothy, who used to drive her gals through
town, to show them off, for promotion.
Dorothy pridefully lent the car. Everyone in Honolulu recognized it
on sight, but the President didn’t know that. He flashed his historic
grin, waved his hat, but couldn’t understand why the cheers were
accompanied by an obbligato of guffaws.
It was charged, and never refuted in the 1950 campaign, by both
Governor Dewey and Mayor Impellitteri that Ed Flynn, New York political
boss and intimate of the late President Roosevelt, is Frank Costello’s
contact in New York State. Flynn, who has, and retained after the
debacle, the national patronage in the state, used it frequently to
procure appointments in high places, including the federal district
bench, the New York State Supreme Court and some prosecutors, of men
known to be friendly to associates of Costello. His defeated choice for
governor of New York, former Congressman Walter J. Lynch, of the Bronx,
had, while he was in Congress, introduced a “sleeper” which would have
permitted the underworld kings, notorious for such frauds, to evade
prison sentences for tax delinquency.
A report, in the possession of the Los Angeles Police Department, which
we have seen, states that Flynn or someone who looked remarkably like
him--with Frank Costello, Phil Kastel and others--was in Mexico City in
December, 1948. Costello was in conferences that contemplated taking
over the Mexican National Lottery. The group was partied by A. C.
Blumenthal, expatriate New York showman.
Lynch, like his boss Ed Flynn, was a never-deviating New Deal-Fair Deal
Democrat. He never voted against an administration measure. In the last
Congress there was a mighty affinity between New Dealers and crooked
dealers. For instance, former Senator Lucas, of Illinois, the majority
leader, was beholden to the Nash-Kelly-Arvey machine. Appointments of
shady figures to federal positions in Illinois cleared through him, the
senior Senator, as all must.