into Idlewild International Airport on September 27 he left the airport
and headed for the Henry Hudson Hotel, followed as usual by the Customs
agents. When he arrived at the hotel he did not go directly to his room
as he customarily did. He slipped into a lobby telephone booth and made
a brief call. Then he went to his room to change into civilian dress.
A short time later, Deppe left the hotel. He walked to the subway and
took a train to Columbus Circle. He changed trains and rode into the
Bronx, where he left the subway and strolled to an apartment building
on Bennett Avenue. He was reaching for the pushbutton at the door of
Apartment 1A when the agents closed in on him.
“We are U.S. Treasury agents,” Smith said. “We want to talk to you.” He
asked Deppe why he had come to this particular apartment.
Deppe made no pretense of innocence or outrage. He said calmly, “I came
here to deliver a package.” He reached into his pockets and pulled out
two envelopes. Inside each of them was a package containing dozens of
diamonds whose value was later appraised at $233,230.
“Go ahead and ring the bell,” Smith said. “Give this package to the
person who opens the door and don’t try any tricks.”
The agents stepped to one side and Deppe rang the doorbell. The door
was opened by Mrs. Julia Michelson, a dark-haired, plump woman whose
husband operated two neighborhood grocery stores.
“Here is the package I was to deliver to you,” Deppe said.
Mrs. Michelson accepted the package with a nod of thanks and started to
close the door. At this moment the agents moved quickly to block the
closing of the door.
“We’re Treasury agents, ma’am,” Smith said. “We would like to talk to
you about this package.”
While Deppe was being taken to headquarters for questioning, Mrs.
Michelson explained that her brother-in-law in Paris had written to her
asking that she accept a package from a friend who would deliver it to
her apartment. She was to hold it until someone else called for it.
“What is this all about?” she asked. “What is in the package?”
“Diamonds,” Smith said. “Smuggled diamonds. I’m afraid you are in
trouble.”
Mrs. Michelson was permitted to call her husband, and when he arrived,
the agents explained the situation. The couple readily agreed to
cooperate in helping trap the receiver who would call for the gems.
For two days, Agents Abe Eisenberg and Harold Smith remained at the
Michelson apartment, waiting for the telephone call from the receiver.
But no call came and no one knocked at the door asking for the package.
Late in the third day the telephone rang and Mrs. Michelson answered.
The caller asked if she were holding a package for him and she replied
that she was. “I’ll be around for it tomorrow morning,” he said.
At 10 A.M. the Michelson doorbell rang. Mrs. Michelson went to the door
and admitted a short, plump, well-manicured man dressed in conservative
clothes. As he entered the living room he must have sensed the
nervousness of Mrs. Michelson because he suddenly turned and started
toward the door. But Eisenberg and Smith stepped from a bedroom doorway
and halted him. He was Samuel Liberman, a Fifth Avenue dealer in
diamonds.
Julius Falkenstein was arrested at his place of business and taken
to headquarters on Varick Street to be questioned. He confessed his
smuggling role. He admitted he had gone to Canada in July to receive a
shipment of diamonds. Something had gone wrong and the diamonds were
never delivered to him. He had been hurrying back to New York to meet
Captain Deppe when he was halted at the border. It was this delay which
had prevented him from meeting Deppe and reporting to Antwerp the safe
arrival of the diamonds. After the experience at the border, he had
been afraid to try to get in touch with Deppe.
Deppe also confessed. He told agents he had carried diamonds into the
United States on six occasions. He told them of the diamonds hidden
in the shoe box which he had left in the Sabena baggage room. He was
supposed to have delivered it to Falkenstein as he had the others--but
when he found the Customs agents searching crew members he made no
effort to retrieve the box. Later, he said, he had asked another Sabena
pilot to pick up the box and make the delivery to Mr. X.
Deppe was deported for his role in the smuggling operation and turned
over to Belgian authorities who were investigating the smuggling ring.
Julius Falkenstein and Samuel Liberman were fined $2,500 each and
sentenced to one year in prison. The sentences were suspended because
of their cooperation with Customs agents.
Before the investigation ended, others involved in the United States
and Belgium included a chauffeur with the French Consulate in New York,
a French Diplomatic courier, an employee in the French Foreign Office,
and an officer in the Belgian air force.
As for Mr. X, Customs agents know that he was successful in smuggling
three shipments of diamonds into the United States even though they
have no proof other than the word of informers. Mr. X is on their list,
and one day, they are certain, he will make a false move that will land
him in prison.
* * * * *
Diamond smuggling is one of the most lucrative of the illicit
operations because diamonds are so easy to dispose of and so easy to
conceal. Diamonds are found hidden in hollowed-out heels of shoes, in
the running boards of automobiles, in rubber contraceptives inserted
into body cavities, in false bottoms of suitcases, in fountain pens,
in hollowed-out books, in women’s corsets and brassieres, and in toy
animals. They come by plane and they come by ship. Communications
between the contact man in the United States and the syndicate in
Europe is so swift that often the syndicate knows within minutes what
has happened to a shipment.
Such was the case when the Racket Squad began a surveillance of
Reginald John Morfett of Rainham, England, who was the purser and chief
steward of the liner _Assyria_. Morfett was fifty-eight years old and
looked more like a Bond Street merchant than an inveterate smuggler. He
was a slender man with thin, black, wavy hair brushed back from a high
forehead. He wore his clothes well.
Agents were watching Morfett when he left the _Assyria_ early in
the evening of October 16, 1955, and stepped onto the North River
pier at 95th Street. An informer in London had reported that Morfett
was carrying eighteen pieces of platinum and gold jewelry, set with
diamonds, rubies, sapphires and jade, in addition to 34.41 carats of
cut and polished diamonds. The jewelry had a total value of $48,135.
Delivery was to be made to two brothers in a hotel room in New York
City.
Morfett rode buses from 95th Street to Seventh Avenue and 50th Street,
where he left the bus and walked to the Taft Hotel. He went into a drug
store to a public telephone booth and made a telephone call.
A short time later, Morfett was joined in the lobby of the Taft by an
attractive, black-haired woman who greeted him warmly. He took her into
a bar where they had a drink, and then they left the Taft and began
strolling up Seventh Avenue.
Agent John Rainey, a ten-year veteran with Customs, was in charge of
the surveillance. It had become apparent to him that Morfett did not
intend to make delivery of the diamonds on this night. He would not be
walking around the streets carrying gems worth more than $48,000. He
reasoned that the jewelry was still aboard the _Assyria_.
“Let’s grab him,” he said, and he signalled to other agents nearby.
Morfett’s frightened companion was released when agents were satisfied
that she was only his date for the night. Morfett was taken back to
the _Assyria_, where the agents began a search of his quarters and the
other places aboard the vessel to which he had easy access.
Throughout the night the agents searched without finding the gems. The
next day a fresh squad took over the search, which was continued in
relays until a short time before the _Assyria_ sailed for Baltimore in
the early morning hours of October 18.
The _Assyria_ was hardly three hours out when the New York Customs
office received a trans-Atlantic call from London. The Customs
representative in London said his undercover source had advised him
that the search of the _Assyria_ had failed--and that the gems were
still aboard the vessel.
The _Assyria_ returned to New York on October 27 and docked at Pier 90
on the North River. Racket Squad Chief Tom Duncan led a squad of agents
aboard to continue the search--they knew this was their last chance
because the ship was due to sail at 7 o’clock that evening.
The search was continued until late in the afternoon. Duncan finally
said wearily, “It’s no use. We might as well knock it off.” He
asked one of the agents to call Tom Rainey and tell him to drop the
surveillance of the brothers to whom Morfett was supposed to deliver
the jewels.
“Tell Rainey we’ll wait for him here,” Duncan said. “Then we’ll all go
to dinner together.”
It was 6:30 P.M. when Rainey walked into Morfett’s quarters. Morfett
sat in a chair looking bored with the whole proceedings. Duncan said,
“The ship sails in thirty minutes. Let’s go and get something to eat.”
Rainey said, “Mind if I take just one more look around?”
“No,” Duncan said. “Go ahead, if it will make you feel better.”
Rainey walked into Morfett’s office and stood studying the room. He and
the others had gone over the place thoroughly. But somehow he had the
feeling that this was the room that held the secret of the jewels--if
there were a secret.
Almost without thinking, he began to measure with his hands a small
safe that sat in a bulkhead cabinet. Then he realized there was a space
of about two inches between the top of the safe and the shelf of the
cabinet, concealed by a strip of molding.
He pried loose the molding and discovered a package. When he opened it,
he saw the sparkle of diamonds.
Rainey walked to the door and as Duncan looked up he tossed the package
to him. “Here are your diamonds,” he said.
Within the next few minutes, the agents found other gems tucked into
envelopes in the hiding place. And then they confronted Morfett. He
shrugged. “That’s it,” he said. “That’s what you have been looking
for.” He lit a cigarette as calmly as though the agents had called on
him to have tea.
As John Reginald Morfett was led from the _Assyria_, Tom Duncan looked
at his watch. It was 6:56 P.M. Four minutes later the ship began to
ease away from the pier.
Morfett was sentenced to three years in prison for his role in the
smuggling effort.
Within a period of three days in 1951--on January 21, 22 and
23--Customs agents and inspectors seized smuggled diamonds worth more
than $1 million. A traveller from Antwerp named Elijah Whiteman was
discovered carrying $300,000 worth of gems in the false bottom of
a suitcase. Lesser seizures totalled $200,000. And then more than
$500,000 worth of diamonds were discovered in a strange scene enacted
at Idlewild airport.
Over the years, many Customs inspectors develop a sixth sense for
spotting travellers who are trying to conceal valuables they do not
want to declare. Perhaps it is the way a man or woman walks, or the
nervous manner in which a cigarette is lit. It may be slight hesitancy
in answering a particular question--or nothing more than a general
impression which the inspector himself cannot explain.
Inspector Joseph Koehler did not know at first what it was that
drew his attention to Etta Hoffman. Koehler was a dark-haired,
studious-looking, middle-aged officer who had joined the Service as a
young man. He had watched travellers by the tens of thousands pass his
inspection post. There was no reason why he should have paid special
attention to Etta Hoffman when she approached his station along with
other passengers arriving from Brussels.
Etta was a tall, neatly dressed, round-faced young woman who waited
placidly in line for her baggage to be examined. A perky hat sat on her
dark hair and there were touches of fur on her dark cloth coat.
Her baggage declaration showed she was alone. Her baggage consisted of
a handbag and two suitcases of inexpensive make. The woman answered all
of Koehler’s questions calmly and without nervousness. She gave no sign
of apprehension when her bags were opened for examination. Yet Koehler
simply could not shake a feeling that there was something wrong.
Something about this woman triggered a small alarm in his subconscious.
Suddenly, Koehler realized what was bothering him. Etta Hoffman was too
tall. Many tall women came through his inspection lane day after day.
But Etta Hoffman’s tallness was unnatural. Her tallness was emphasized
by the extraordinarily thick-soled shoes she was wearing. It simply
wasn’t reasonable for a woman trying to look attractive to deliberately
make herself unattractive.
Koehler quietly signalled a woman inspector, Mathilda Clark. Miss
Hoffman was taken to a room set aside for questioning passengers. The
soles of her shoes were hollow. When the inspectress pried them open,
a handful of diamonds spilled out on the floor. Other gems were found
in a false bottom of a suitcase. The diamonds weighed 3,377 carats, and
were one of the largest diamond hauls ever made by Customs.
Etta Hoffman broke down in tears and poured out her story. She had
dreamed for years (so she said) of coming to the United States and
obtaining citizenship. She had come to Belgium as a refugee from
Czechoslovakia and had succeeded at last in getting her name on the
immigration quota.
After months of waiting and suspense, Etta received the necessary
papers from the American Consulate. Then a strange man called at her
apartment and offered to pay her fare to the United States and give
her $100 in cash if she would smuggle the diamonds past Customs. He
provided her with the trick shoes, the suitcase with the false bottom,
and a plane ticket. Before she boarded the plane, he had given her a
sealed envelope which he said contained the $100 which he had promised
her.
Etta Hoffman handed the envelope, still sealed, to a Customs inspector.
He tore it open and found that it contained only $80. She had been
shortchanged by $20, and, to pile injury on insult, she was sentenced
to eighteen months in prison.
Abraham Winnik was another of the more successful diamond and gold
smugglers. This thin-faced Belgian was an expert procurer of carriers
for an Antwerp syndicate. He arranged for diamonds to be brought
into the United States, and after they were sold he engineered the
smuggling of gold to Europe. The gold was carried in the false bottoms
of suitcases fashioned by an expert leather worker in Brooklyn--who
received $30 for each suitcase he altered.
One of those enlisted into Winnik’s ring of carriers was Mrs. Adele
Meppen, a stocky Brooklyn housewife who gave Customs agents this story:
“I first met Abraham Winnik sometime in 1949 when he was visiting in
Brooklyn. My husband and I became friendly with him, and whenever he
visited this country he would come to see us at our home.
“Late in 1949 Marion Strokowski, a friend of Winnik’s, visited us. He
asked me how I would like to make a trip to Europe. I told him I didn’t
have the money. ‘Don’t worry about expenses,’ he said. ‘If you will
do me a favor, I’ll pay your expenses. All you have to do is take two
suitcases to a friend of mine.’
“I agreed and Mr. Strokowski bought my ticket. He brought two suitcases
to my home which I packed with clothes. I left New York from Idlewild
airport by KLM Airlines, sometime in May, 1950. When the plane reached
Amsterdam, Mr. Winnik met me at the airport and drove me in his
automobile to his home in Brussels.
“I stayed there for about three weeks. I met Mr. Winnik’s wife, Anna,
and Mr. Strokowski’s wife, Janka. I brought back two suitcases they
gave me, and a couple of days after I got home Mr. Strokowski called
for them and took them away. He gave me my plane fare both ways and
expenses....”
Five months after her return from this trip, Mrs. Meppen received a
call from Winnik asking her to meet him in Montreal. He wanted her to
“bring something into the country” for him. He said he would pay her
expenses--and a little extra.
Mrs. Meppen flew to Montreal and went to the Laurentian Hotel, where
she found Winnik and Janka Strokowski. They told her they wanted her
to carry diamonds into the United States--and there would be no risk
whatever.
Mrs. Meppen protested she didn’t want to get involved and, besides, she
was scared. They convinced her there was no danger. Janka Strokowski
helped her insert two rubber-covered packages into her anus.
This smuggling effort perhaps would have gone as smoothly as the others
engineered by Winnik except that somewhere along the line an informer
had tipped Canadian Customs officers that Winnik had entered Canada
carrying a small fortune in diamonds.
Winnik had been searched when he arrived at the Gander airport in
Newfoundland and Customs officers there had found nothing. But the
Canadians continued to keep Winnik under surveillance and they notified
the U.S. Customs of the information they had received. The American
agents joined in the surveillance in Montreal.
U.S. Agents were watching when Winnik and Mrs. Strokowski placed Mrs.
Meppen aboard a train enroute to New York--and two agents were on the
train when it pulled from the station. At Rouses Point, on the Canadian
border, Mrs. Meppen was taken from the train and searched--but the
search revealed nothing.
That night Mrs. Meppen obtained a room at the Holland Hotel. The
following morning when she came from her room she saw several Customs
agents lounging in the lobby. They, too, were waiting for the next
train to New York--no longer interested in Mrs. Meppen because the
previous day’s search had been futile.
But Mrs. Meppen was frightened. She hurried to the public toilet near
her room....
A few minutes after Mrs. Meppen boarded the train for New York the
manager of the Holland Hotel called in a plumber to unstop a toilet in
the ladies’ room. He found in the trap a rubber-covered packet stuffed
with diamonds. Three days later the same toilet became stopped again.
Again the plumber found a package of diamonds blocking the drain, a
coincidence so unusual that the plumber became a local celebrity.
The hotel manager turned the diamonds over to Customs agents, and Mrs.
Meppen was soon taken into custody for questioning. She confessed her
role in the abortive smuggling effort, and a few days later Winnik was
arrested as he was trying to board a plane for Amsterdam. He broke down
and confessed, too.
Mrs. Meppen pleaded guilty and as a cooperative witness against Winnik
was placed on probation for five years. Winnik was sent to prison
for two years. Marion and Janka Strokowski were indicted, but since
both were outside the jurisdiction of the United States courts, the
indictments were dismissed.
The diamonds which Mrs. Meppen tried to flush down the toilet were
worth $121,000.
15
A FOOL’S DREAM
From long experience U.S. Customs agents and inspectors know the
methods of professional smugglers. But the non-professional smuggler
is a problem, too. One of the more bizarre cases of jewelry smuggling
in Customs history, involving the fabulous crown jewels of Hesse,
was engineered by non-professionals. They were two lovers and their
accomplice, who looked at the sparkling gems and were overwhelmed by
avarice.
This plot began to unfold one cold November day in 1945 in the gray
old Kronberg Castle at Wiesbaden, Germany, near Frankfurt. The castle
was the home of Prince Wolfgang and the Countess Margarethe of Hesse,
a daughter of Emperor Frederic of Germany and granddaughter of Queen
Victoria of Britain. Now it was requisitioned as a recreation and rest
center for the men and women of the U.S. Armed Forces.
The hostess in this royal setting was trim, attractive WAC Captain
Kathleen Nash of Hudson, Wisconsin, a divorcee who told friends that
she had gone into the WACs to “get away from it all.”
One evening there was a knock at Captain Nash’s door and Mess Sgt. Roy
Carlton stepped into her room, his eyes wide with excitement.
“Captain,” the sergeant said, “there’s something I think you ought to
know about. You know the old German janitor? Well, he told me a few
minutes ago that when the war began, the old lady of the castle came to
his house late one night and told him to come with her and to tell no
one where he had gone. She took him into the basement of the castle,
that little room that is used for coal storage, and told him to dig a
hole in the floor. He broke through the concrete and dug a big hole
in the floor and then she sent him away. But when he came back to the
room several days later he found the hole had been covered with new
concrete. He figures that something was buried there by the old lady.”
Captain Nash told the sergeant to bring the janitor and they would go
to the basement room and investigate. They made their way down the
winding stairs into the subterranean rooms of the castle to the coal
room. The old janitor pointed out the spot where he had dug the hole.
Captain Nash ordered him to dig into the floor and see if anything had
been hidden there.
The German broke the concrete with a sledge and then began digging. He
uncovered a wooden box. The box was lifted out of the hole and when the
top was ripped off they saw a lead box inside. The lead box contained
several packages, carefully wrapped in heavy paper, weighing about 10
pounds each.
“You had better take them to my quarters,” Captain Nash told the
sergeant.
When Captain Nash opened the packages in the privacy of her quarters
her eyes must have glittered with excitement. She was gazing on one of
the fabulous treasures of Europe--jewelry worth at least $1,500,000, if
in fact a money value could be placed on the historic items at all.
Part of the jewelry belonged to the House of the Kurfursts and to the
Kurhessen Foundation. Most of it belonged to the Countess Margarethe
and to Prince Wolfgang. Some of it was the personal property of
Princess Christoph and Prince Richard of Hesse. The owners, who lived
in less pretentious quarters at this time, rarely visited the old
castle, and none was aware that the treasure had been discovered.
Captain Nash was enchanted. She took from the boxes diadems and
necklaces of diamonds, pearls and amethysts; rings of diamonds and
other precious stones; a diamond-studded onyx badge, made in the
eighteenth century: the badge of the Order of the Garter, which had
been presented by King George II to his son-in-law; necklaces of gold
and platinum; bracelets of diamonds and emeralds and pearls and topaz;
buckles studded with diamonds; large and small brooches studded with
diamonds and other stones; pendants with large and small diamonds;
earrings made of diamonds and emeralds and pearls; tiaras delicately
fashioned of gold and studded with diamonds and other gems; a large
necklace of gray pearls and diamonds; an English decoration of the
Victoria and Albert Order, including a cameo with portrait of Queen
Victoria and her Prince Consort, surrounded by small diamonds; diamond
stick pins; diamond earrings; diamond-studded watches; diamond studded
cases; and golden chains studded with large stones.
This, then, was the treasure which the girl from Wisconsin picked up,
piece by piece. At some period as she looked at the glittering jewels,
the idea was born that she would not give them up.
One of the most frequent visitors to Kronberg Castle was slender,
handsome Air Force Colonel Jack Durant, who was Kathleen Nash’s boy
friend and constant companion. Colonel Durant had been an attorney
in the U.S. government’s Interior Department before he went into the
Air Force at the outbreak of the war. He was attached to the Adjutant
General’s office and therefore was not unaware of the rules governing
the conduct of the armed forces.
Captain Nash invited Colonel Durant and her friend, Major David Watson,
to her quarters. She showed them the treasure which had been dug from
the coal room in the basement of the castle. And then it was they began
to talk of stealing the Hesse jewels.