Garza feigned surprise over the discovery of the marihuana. He told

officers he “had no idea what was in the sacks.” He said a man named

Tony called at his home one day and left a truckload of sacks. Tony

asked him to keep them for him. Another fellow named Pepe came from

Chicago three or four times. “He picked up some of the stuff and gave

me $600 for rent and expenses--but I didn’t know what it was all

about,” Garza said.

A jury thought otherwise. Garza was sent to prison for five years. And

Muno Pena? He had lost another round to Dave Ellis, but he continued

his operations on a smaller scale. Customs agents are waiting for the

day when he places one foot across the border--and then he’ll be out of

circulation for quite a while.

11

A DIRTY BUSINESS

A cunning and ruthless hoodlum, two crooked Customs employees, two

Greek narcotics peddlers in Shanghai and a supporting cast of killers,

goons and dupes formed one of the greatest narcotics syndicates the

United States has ever known. Over a span of less than two years in

1936–1937, this gang smuggled into the country narcotics believed by

Customs agents to have had a retail value of at least $10 million.

Their system was so simple that it was almost foolproof. Almost ... but

not quite.

The prime mover in this profitable operation was Louis “Lepke”

Buchalter--a name which perhaps doesn’t mean much to the younger

generation. But in the prohibition era and the years of the depression,

Lepke built a fantastic financial empire on a foundation of terror,

violence and murder combined with a genius for organizing. He was,

in many respects, more powerful and more successful than “Scarface”

Al Capone and dozens of other hoodlums of the times who were more

publicized in the nation’s press.

Louis Lepke Buchalter rose to power in the shadow of the Jazz Age,

the era which evokes sentimental memories for so many Americans. But

Lepke’s world was about as sentimental as a tommygun.

He was a small, slender man--5 feet 7--with a dark complexion and black

hair which he parted on the side. He was soft-spoken and seemingly

humble in manner. He had large brown eyes that appeared as soft and

gentle as the eyes of a fawn. But his eyes only masked the evil in this

man who schemed and killed until he ranked at the top of the list of

U.S. criminals.

By all odds, Lepke was the most brilliant--and the most dangerous--of

the criminals. It was Lepke who showed the underworld how to infiltrate

and take over control of labor unions, and how to become silent

partners in the management of industries. It was Lepke who put murder

on a wholesale basis with an organization that became known as Murder,

Inc. It was Lepke who found the chink in the U.S. Customs Bureau’s

defenses against narcotics smuggling--and who made narcotics smuggling

almost a pleasant pastime.

Lepke is worth at least a footnote in any history of our times because

he symbolized an era of graft, corruption and violence the likes of

which the nation had never known before. He was born on February

6, 1897, in Manhattan’s Lower East Side, one of a family of eleven

children. The family lived in shattering confusion in a small, crowded

apartment over the hardware store owned by the father, Barnet Buchalter.

Lepke’s mother called him “Lepkeleh,” the Jewish diminutive for “Little

Louis,” and his friends shortened the nickname to Lepke. He was not a

bad student in grade school. But he quit school after finishing the

eighth grade and for a time worked as a delivery boy at $3 a week.

His father died when he was thirteen. The family broke up and

scattered. The other ten children went on to become respectable, useful

citizens. But not “Little Louis.” He rented a furnished room on the

East Side and turned to crime. He organized raids on pushcart peddlers,

stole from lofts, picked pockets, and lived by his wits. He was sent

to the reformatory and to prison for short terms for larceny, but he

always returned to the old life. He had ambitions to become a big shot

in New York’s underworld.

In the early 1920s, Lepke joined an East Side mob headed by “Little

Augie” Orgen. But while most of the underworld scrambled to satisfy

the country’s unquenchable thirst for bootleg whiskey, Lepke convinced

Little Augie that it was safer, smarter and more profitable to

specialize in labor racketeering and in selling “protection” to

businessmen.

If an employer was having trouble with strikers, Lepke would see to

it that the recalcitrant workers were beaten up by his goons and that

peace was restored at no increase in wages. If union leaders were

having trouble with rank-and-file members, Lepke’s strong-arm squad

would bring the rebels back into line with beatings and threats against

the men’s families.

Other mobs sold such services on a flat-fee basis. But not Lepke. When

his men were hired to put down a union revolt, they remained as members

and then slowly muscled their way into the management of the union. The

members’ dues were increased to pay for the services rendered.

Businessmen who hired Lepke’s strike-breaking services were ordered to

buy the protection on a continuing basis. If they refused, a bomb would

be hurled through a window to wreck a plant or a shop. Acid would be

thrown onto merchandise, or someone’s face would be splashed with acid

as he walked from his place of business to his home.

Those who capitulated--and most of them did--soon found Lepke’s men

demanding a voice in management, even to the dictation of contracts

(from which they received a kickback) and the placement of a man in the

business office to keep a check on the money.

Little Augie was pleased with Lepke’s organizing brilliance and the

profits that were rolling in. But the word got around that he didn’t

like Lepke’s growing strength in the organization, where he was known

as “The Judge” and “Judge Louis.”

Little Augie’s irritation was short-lived. On October 16, 1927, as

he stood in a doorway at 103 Norfolk Street talking with his young

bodyguard, a sedan suddenly swerved to the curb. A voice called, “Hey,

Little Augie!” As the gang chief turned, a burst of machinegun fire

cut him down. His wounded bodyguard was identified by police as John

Diamond--later to become better known as Jack “Legs” Diamond.

The underworld hummed with the story that Little Augie had fallen

victim to Lepke’s ambition. On the basis of an informer’s tip, police

picked up Lepke, “Gurrah Jake” Shapiro and “Little Hymie” Holtz and

charged them with murder. But no one could prove anything and the case

soon was dropped.

With Little Augie out of the way, Lepke set to work to consolidate

his empire. He moved more solidly into the leather, baking, garment,

fur and transportation industries. At the peak of his power, Lepke

personally directed some 250 criminal operations. He rode about New

York in a limousine with a liveried chauffeur. He had a staff of 300

men looking after his affairs, plus an assortment of accountants,

bookkeepers, gunmen, strong-arm men, and experts in such matters as

acid-throwing.

He also put murder on a cash-and-carry basis. If a member of the

mob became careless or talked too much, he was executed summarily.

Dangerous witnesses were ordered to leave the state under the threat of

death--and if they refused to obey, they were killed.

Oddly enough, even at the height of his power, Lepke was virtually

an unknown in New York and throughout the country. While other

hoodlums gained the headlines, Lepke remained in the shadows with few

people realizing the extent of his empire, whose earnings have been

estimated at more than $50 million a year. Nor was it known for twelve

years--1927 until 1939--that Lepke alone had ordered the deaths of from

sixty to eighty men whom he considered a threat to his own safety and

prosperity.

By 1933, however, the operations of Lepke and other racketeers had

aroused such popular indignation that the U.S. government moved against

them. In November of that year a Federal grand jury indicted Lepke on

two counts of violating the antitrust laws through his domination of

the rabbit-fur-dressing industry. He was arrested and released on bail.

He returned home to his wife and adopted son to continue operations as

usual while the wheels of justice turned slowly.

It was during this period that another opportunity came to Lepke quite

unexpectedly. Three hoodlums--Jack Katzenberg, Jake Lvovsky, and Sam

Gross--were allied with other gangsters in the operation of an illicit

chemical plant in Newark, New Jersey. The gang was smuggling opium

into the country, taking it to the plant and extracting morphine from

the opium, to be sold at wholesale across the country. This business

was wiped out on February 25, 1935, when an explosion destroyed the

chemical plant.

Katzenberg, Lvovsky, and Gross had found the narcotics business too

profitable to give up. They began looking around for other ways to get

back into the business, and they decided to talk the problem over with

Lepke. A mutual friend brought them together in his apartment, where

they discussed setting up an international organization which would

obtain narcotics in Shanghai and smuggle them into the United States.

The sale of narcotics was to be put on the same efficient basis as the

sale of murder.

The major stumbling block to the plan was the U.S. Customs. It would

be relatively simple to obtain heroin in Shanghai and to bring it as

far as the port of New York. The problem was how to smuggle it past the

Customs inspectors on a continuing basis that would guarantee a steady

supply with a minimum risk.

Lepke was a firm believer in the adage that every man has his

price--and he was certain he would have no difficulty in finding

someone whose price was reasonable and who would cooperate with the

syndicate. This direct approach had always worked in the past and Lepke

had no reason to change tactics now.

One of Lepke’s first moves was to investigate the Customs procedures at

the New York pier. He found that when vessels arrived at the Port of

New York, the passengers’ baggage and trunks were brought to the pier

for examination. And when they had been examined, a Customs inspector

affixed a colored stamp on each piece of luggage. Once the stamps were

affixed, the luggage could be removed from the pier and placed in a

taxi or in a truck to be carted away.

Lepke saw that the stamps were the key to his problem. If he could find

a Customs employee who would furnish him with the colored stickers,

then a sticker could be affixed to a trunk or a suitcase containing

narcotics and it would pass through Customs without an actual

inspection.

Carefully, Lepke’s lieutenants made inquiries along the waterfront. At

last they found their men, two guards who were willing--for a price of

$1,000 a trip--to furnish Lepke and his men with the necessary stickers

on the day that the narcotics carriers arrived. The price was cheaper

than Lepke had expected.

With easy entry for the narcotics assured, Lepke arranged to obtain

heroin from two Greek dealers in Shanghai.

This was the state of affairs when Jack Katzenberg made a trip to

Brooklyn for a visit with his brother-in-law, Ben Schisoff, a balding,

sad-eyed man with the face of a ferret. Ben and his wife Bella operated

a Coney Island hot dog concession. They cleared about $1,500 to $2,000

in profit each season, enough to live on through the winter and to take

care of the concession rental for the next season.

Katzenberg generously offered to send Ben on an all-expenses-paid trip

around the world by luxury liner. All he asked in return was that

Schisoff bring back two trunks from Shanghai. “You won’t even have

to bother about looking after the trunks,” Katzenberg said, “because

there’ll be somebody to do that for you. And when you get back I’ll

have some money for you.”

Schisoff was confused. (At least that was the story he would tell

Customs agents later.) Why would his brother-in-law suddenly wish to

send him around the world with all expenses paid--and then give him

money at the end of the trip? He knew his brother-in-law was in the

rackets. He knew his reputation as a hoodlum. He also had heard all

the rumors that Katzenberg was connected with the narcotics traffic

even though he had managed to elude Federal officers. Schisoff told

Katzenberg to give him a few days to think it over.

Schisoff finally sat down with his wife and said, “Listen, Bella, I

want to go on a trip by myself. You go to Miami. You’ve worked hard and

now you are entitled to share the money we have. I want to go alone.

You know I am a nervous type of man and I want to go for a couple of

months to recuperate. You can stay home or you can go to Miami or do

whatever you please. How about it?”

But Bella was having none of this business of her husband taking

a vacation alone. She loudly insisted that if he were going on a

trip, then she was going with him. She wasn’t going to let him go

gallivanting off by himself to get into God knows what sort of trouble.

Her answer was “no!”

Schisoff reluctantly told Katzenberg that his sister insisted on going

along. He expected his brother-in-law to call off the deal. But instead

Katzenberg amiably agreed that both of them could go and that he would

pay their expenses. And so on November 15, 1935, the couple boarded the

SS _President Lincoln_ in San Francisco and set sail that day on their

voyage around the world by way of Shanghai.

When the _President Lincoln_ arrived in Shanghai, Sam Gross was

waiting at the pier to meet them. He introduced them to his two Greek

companions and then took them to the Metropole Hotel, where he had

made reservations for them. Sam said, “Now you two get a good rest.

Everything is going all right.”

As Schisoff told the story later: “A few days later, Sam Gross tells

me that he is going away for a week. He said to us, ‘Don’t walk too

often in the street because it is not so good.’ I said, ‘All right.

But what will I do if anything happens? Maybe I’ll get sick. I don’t

know anybody around here.’ So he gave me an address. In case anything

went wrong I should call that telephone number. I don’t remember the

address and the number. It was a Greek fellow, named Jay, and his wife.

Finally Sammy Gross puts a scare into me and tells me not to go into

the streets.

“And so we stayed in the hotel until we got blue in the face. And so my

wife finally says, ‘We have money. Why sit in the hotel? I want to do

some shopping. Everything is so cheap here.’

“So we were sitting there about three days and then I called that

number that Sam gives me and the wife answered. I told her about us.

She answered, ‘All right, I’m going to send my chauffeur to bring you

over....’ She treated us to a meal and we spent the afternoon there and

then went home.

“Gross finally returned and said, ‘Listen, the ship is going to be here

in a day or two. I’ll have two trunks for you to take with you. You

don’t have to do anything. We will put the trunks on board for you and

I will show you what to do when you are on the boat. You forget about

the trunks. When you are about three days out of Marseilles, go to the

purser and say that you want to have the trunks shipped across France

to Cherbourg in transit. Then when you get to Marseilles, there’ll be

somebody waiting for you to take care of everything. That way they

don’t have to open the trunks when they go through France.’”

The Schisoffs had a gay Christmas party at the home of the Greeks,

and four days later they boarded their ship and sailed from Shanghai.

They were met in Marseilles by one of Lepke’s henchmen, who handled

the trans-shipment of the trunks. Then the Schisoffs left the ship at

Marseilles and went by train to Cherbourg to catch the SS _Majestic_

for New York.

Lepke’s man told them, “Don’t put those two trunks on your baggage

declaration.”

Schisoff said, “How am I going to do it then?”

The hoodlum said, “You’ve got eight pieces of luggage of your own. You

put down everything on the declaration that you bought but leave these

two trunks out. They will be taken care of. Don’t you worry about that.”

Schisoff replied, “All right. Whatever you say is all right with me.”

On the night of February 4, 1936, the night before the _Majestic_ was

to dock in New York, Jake Lvovsky and Jack Katzenberg registered at

the Luxor Hotel in New York. A short time after they went to their

rooms they were joined by two Customs guards, John McAdams and Al

Hoffman. It was agreed that Lvovsky would meet McAdams and Hoffman at

the pier the next morning before the _Majestic_ docked and they would

turn over to him the stickers to be placed on the trunks brought in

by the Schisoffs. The stickers were issued to the guards each morning

and a new color was used each day. For that reason the delivery of the

stickers had to be made at the pier.

Lvovsky arrived at the pier as the _Majestic_ was docking. He stopped

and chatted casually with McAdams, who slipped him the stickers. When

the baggage was unloaded, the Schisoffs’ trunks were sent to the

section marked with the initial “S.” Schisoff pointed out the two

trunks to Lvovsky, who walked over casually and sat down on a trunk

to smoke a cigarette, as though waiting for an inspector to check the

luggage. Unobtrusively he took one of the stickers and pasted it to the

trunk. He moved to the other trunk, sat down, and pasted a sticker on

that trunk. And then he strolled away.

A Customs inspector examined the Schisoffs’ suitcases, but he noted

the trunks already had the inspection stickers on them so he permitted

them to be carted off. They were loaded into taxis by Lvovsky and

Katzenberg and hustled off to an unknown destination.

The system worked like a charm. Each time that Lvovsky notified the

two Customs guards of an arrival of a “world traveller” the guards

would arrange to be on duty at those hours so that they could obtain

stickers and pass them on to Lvovsky. Six times the confederates of the

gang made the trip safely from Shanghai without any inspection of the

heroin-loaded trunks.

But Treasury agents were closing in on the gang. Narcotics agents,

with aid from Customs agents, had opened an investigation of Lepke’s

narcotics smuggling ring after an informant had squealed to Narcotics

Commissioner Harry Anslinger. The informant--whose name has never been

disclosed--was a woman with revenge in her heart. Her boy friend--one

of the Lepke mob--had been playing around with another woman and she

wanted to get even with him for his infidelity. She gave Anslinger

enough information, with facts that could be verified, to start the

ball rolling. Bit by bit, the agents closed in on the gangsters. And

they discovered by a close check of the stickers issued to all pier

personnel that there was an irregularity in the stickers which had been

issued to the guards McAdams and Hoffman.

As the agents began to put on the heat, underworld characters started

to talk. Those “world travellers” who had helped bring narcotics into

the country began to confess. Evidence mounted against the gang, and

when the crackdown finally came, a total of thirty-one persons were

involved. Lepke was indicted on ten counts of a conspiracy to smuggle

narcotics into the United States.

At this time--December, 1937--Lepke was a fugitive. A little more than

a year earlier he and Gurrah Jake Shapiro had been convicted on the

antitrust charges brought against them four years earlier. They had

been sentenced to two years in prison and fined $10,000. But Lepke

appealed. He was released under $3,000 bail and immediately went into

hiding.

For almost two years Lepke’s pals hid him from the law. He lived for

a time in the old Oriental Dance Hall on Coney Island. Then, twenty

pounds heavier and wearing a mustache, he moved to a flat in Brooklyn.

Later he occupied a house in Flatbush, posing as the paralyzed husband

of a Mrs. Walker. All this time he continued directing the affairs of

his criminal organization.

But now, in 1939, the search for Lepke had become the most intense

manhunt the country had seen in years. The Federal government wanted

him on the narcotics charges growing out of his syndicate operations.

And he was the No. 1 man on the most-wanted list of New York’s District

Attorney Thomas E. Dewey, who then was opening his first bid for the

Republican Presidential nomination. Among other things, Dewey was

certain he could pin a murder charge on Lepke--who now had “dead or

alive” rewards on his head totalling $50,000.

As the pressures mounted, the hunted man became desperate. And

desperately he tried to wreck the cases against him by sending

witnesses out of the state, by intimidation, and by murder. The heat

was on the underworld as it had never been before. The rumor spread

that if Lepke did not surrender to the authorities, he would be

killed by one of his own kind. Lepke had at last become too much of a

liability even to his old pals.

Hunted and frightened, with every day holding the threat of sudden

death, Lepke began negotiations to surrender to New York Columnist

Walter Winchell--on the condition that he would be turned over to the

FBI rather than New York State authorities.

During the evening of August 5, Winchell received a telephone call from

a man who refused to identify himself. “Lepke wants to come in,” he

said. “But he’s heard so many different stories about what will happen

to him. He can’t trust anybody, he says. If he can find someone he can

trust, he will give himself up to that person. The talk around town is

that Lepke would be shot while supposedly escaping.”

Winchell called FBI Director John Edgar Hoover in Washington and told

him of the mysterious call and Lepke’s willingness to surrender if he

could be assured of protection.

Hoover told Winchell: “You are authorized to state that the FBI will

guarantee it.”

For almost three weeks the dickering continued between Winchell and his

mysterious callers until Hoover finally said, “This is a lot of bunk,

Walter. You are being made a fool of, and so are we. If you contact

those people again, tell them the time limit is up! I will instruct my

agents to shoot Lepke on sight.”

Winchell relayed this information to the intermediary. Then it was that

arrangements were made for Hoover to be waiting in his automobile on

28th Street near Fifth Avenue at 10:15 on the evening of August 24.

Winchell was parked in his car at Madison Square when Lepke came out of

the shadows and stepped into the car beside him. “Hello,” Lepke said.

“Thanks very much.”

Quickly, the columnist drove to 28th Street, where he pulled up behind

Hoover’s car. Lepke quickly moved into the automobile beside Hoover.

Winchell said, “Mr. Hoover, this is Lepke.”

“How do you do,” Lepke replied. “Let’s go.”

And so ended one of the greatest manhunts in American criminal history.

Four months later, Lepke went on trial in the Federal district court

in New York City. He sat in silence, his brown eyes expressionless, as

his former henchmen paraded to the stand to tell the details of their

narcotics smuggling.

Among the government witnesses, many of them pale from sunless days

in prison, were Jack Katzenberg, Ben Schisoff and John McAdams, the

Customs employee. No longer were they afraid of the little man who sat

there staring at them.

The trial dragged through fifteen days, but in the end Lepke was

convicted. He was sentenced to serve fourteen years in prison and was

fined $2,500 on ten narcotics charges. Two weeks later in General

Sessions Court, Lepke was convicted on thirty-six counts of extortion

and sentenced to an additional thirty years in prison.

Among the others involved in the smuggling ring, Lvovsky received seven

years in prison and was fined $15,000. Sam Gross was sentenced to six

years and fined $15,000, while Katzenberg was given ten years and a

$10,000 fine. Both the Customs employees, McAdams and Hoffman, also

received prison sentences.

But the final ordeal for Lepke was yet to come. In October, 1941, Lepke

was taken from prison and returned to New York to stand trial for his

role as mastermind in the operations of Murder, Inc. Specifically, he

was charged with ordering the murder of a former garment industry truck

driver, Joseph Rosen, who had ignored his warnings to get out of town

and out of reach of questioning by District Attorney Dewey at the time

Dewey was investigating the rackets in New York.

Border guard · 第 12 / 24 段