Boardwalk Gangster (8 page)
Read Boardwalk Gangster Online
Authors: Tim Newark
“Careening wildly from side to side,” said a newspaper report, “the riddled sedan sped north to the intersection of 84th Street, where its driver lost control. The car smashed into the railing surrounding the island park just north of the street crossing and was almost completely wrecked. Two men jumped out of the car and lost themselves in the street crowds. The police found that although the sedan was equipped with bullet-proof glass an inch and a half thick, at least 11 shots had penetrated the body of the sedan. In the back seat were fresh bloodstains.”
The gunfight was thought to be linked to the death of two
henchmen working for chief bootlegger Waxey Gordon. No one had told them about the need for criminal coordination.
henchmen working for chief bootlegger Waxey Gordon. No one had told them about the need for criminal coordination.
Throughout this period, Meyer Lansky remained Luciano’s leading associate. He had imbibed the lessons of Rothstein and was an expert moneyman, investing the Mob’s money wisely and effectively and always open to the next big opportunity. He was Luciano’s number one adviser and commanded the respect of all other Jewish gangsters. He was happy to let Luciano be regarded as head of the Mob, because he was the brains behind the operation and preferred life in the shadows. He was never happier than sitting in his book-lined study at home reading about the life of another physically small but determined operator—Napoleon Bonaparte. Lansky remained close to Bugsy Siegel and would use him to open up new territories in the future, but for the moment, his childhood pal remained a feared gunman.
Louis Lepke consolidated his control over the garment district, the Amalgamated Clothing Workers, and other unions. The labor racket brought in millions of dollars and he lived the life of a playboy. He also headed a major narcotics smuggling network. Longy Zwillman, along with Willie Moretti, took care of illegal operations in New Jersey. Frank Costello was the fixer, forging close links with politicians and judges, and dispensing annually thousands of dollars to law enforcers, to protect the Mob’s interests. His slice of the business was gambling, and it is claimed he used his influence on the racetrack to provide FBI supremo and gambling addict, J. Edgar Hoover, with surefire winners. It helped to keep the FBI off their backs. Costello liked to spend his fortune on dressing well and when a lawyer later asked him to wear a cheaper suit for a trial he said, “I’m sorry counsellor, I’d rather blow the goddam case.”
The muscle needed to keep Luciano and his associates at the top of the pile was provided by Murder, Inc. Headed by Albert Anastasia and Joe Adonis, younger members of Luciano’s original gang, this was a group of professional gunmen who were
called in to execute a contract on anyone obstructing their ambitions. The idea was that orders for killings were passed down from chief mobsters through lieutenants to gunmen who knew neither their bosses nor their intended victims, so it was very difficult to link them to the murders. It was nothing personal, just business, and anyway, as Bugsy Siegel famously declared, “We only killed each other.” Actually, that wasn’t true. Murder, Inc., was directed to kill anyone who got in their way, including “civilians,” fringe criminals, and trial witnesses.
called in to execute a contract on anyone obstructing their ambitions. The idea was that orders for killings were passed down from chief mobsters through lieutenants to gunmen who knew neither their bosses nor their intended victims, so it was very difficult to link them to the murders. It was nothing personal, just business, and anyway, as Bugsy Siegel famously declared, “We only killed each other.” Actually, that wasn’t true. Murder, Inc., was directed to kill anyone who got in their way, including “civilians,” fringe criminals, and trial witnesses.
That these top gangsters were still not immune to deadly threats from rival mobsters was revealed in a violent incident on November 9, 1932. Tony Fabrizzo was a hit man for Waxey Gordon, who had a long-term vendetta against Lansky and Siegel. Fabrizzo went to the Hard Tack Social Club at 547 Grand Avenue, New York, where Lansky and Siegel liked to meet. The Italian assassin lowered a bomb down the chimney of the building but failed to take into account that the chimney had a rightangle offset that caused the bomb to become stuck before reaching the meeting room level. The bomb went off and did not kill the intended victims, but it still did considerable damage to the building and Siegel was taken to hospital with severe head injuries caused by flying bricks. Eleven days later, Siegel tracked down Fabrizzo and shot him dead.
Thomas E. Dewey was a baby-faced attorney with mighty ambitions. Eventually, he would become governor of New York and run for president of the United States. In early 1931, however, there was no sense of the illustrious career to come his way. He was just twenty-eight years old, earning a salary of $6,400 a year, and only had experience in handling civil cases related to family estates, big hotels, and banks. It was through one of these cases that he managed to impress George Z. Medalie, one of New York’s most successful trial lawyers.
When Medalie gave up his lucrative private practice to assume
the role of U.S. attorney for the southern district of New York State, the much older lawyer offered Dewey the position of chief assistant U.S. attorney in March 1931. It was an extraordinary post for someone so young and inexperienced in criminal law, and it came with a federal prosecuting office of sixty lawyers working for him. But Dewey grabbed the opportunity and applied himself diligently, mastering every aspect of the task before him. His appointment coincided with the national mood for political change and an end to the rotten practices of the 1920s. He came from a family of leading Michigan Republicans and was no friend of New York Democrats. Indeed, his father had told him: “Tammany Hall represents all that is evil in government.” He stayed beyond the reach of Luciano, Costello, and their Democrat stooges.
the role of U.S. attorney for the southern district of New York State, the much older lawyer offered Dewey the position of chief assistant U.S. attorney in March 1931. It was an extraordinary post for someone so young and inexperienced in criminal law, and it came with a federal prosecuting office of sixty lawyers working for him. But Dewey grabbed the opportunity and applied himself diligently, mastering every aspect of the task before him. His appointment coincided with the national mood for political change and an end to the rotten practices of the 1920s. He came from a family of leading Michigan Republicans and was no friend of New York Democrats. Indeed, his father had told him: “Tammany Hall represents all that is evil in government.” He stayed beyond the reach of Luciano, Costello, and their Democrat stooges.
At first, Dewey took on cases of fraud. He helped Medalie prosecute a Harlem lottery racketeer called Henry Miro. They used tax law to pursue him, just as it had been used to get Al Capone. The case opened Dewey’s eyes to the vast sums of money being made in the New York underworld. He calculated that Miro alone was making something like a million dollars a year, and he was just one of ten or fifteen such crooks.
“If this is a fact,” he later broadcast to a radio audience, “then the underworld takes ten to 15 million dollars a year out of the numbers game alone to finance its depredations against legitimate business and the lives of the people of New York. With such a war chest, organized crime has abundant means for corrupting public officials and buying immunity from punishment.”
As Dewey delved deeper, he came across the activities of the erratic and dangerous Dutch Schultz. Schultz was one of the other great criminal associates of Luciano—never one of the Big Six because of the independent character of his business, but certainly in alliance with them as part of a New York syndicate. Another protégé of Rothstein, he took over the numbers racket in Harlem and ran bootleg beer in the Bronx. In 1931,
Dewey discovered that Schultz had deposited $856,000 in various bank accounts and doubted very much that he had paid a penny in tax on it. Later in the same year, Dewey took on Jack Diamond and successfully prosecuted him for operating a still, for which he received a fine of $11,000 and a four-year prison sentence. In a subsequent trial, Diamond was acquitted, but by the end of the year he had been shot dead.
Dewey discovered that Schultz had deposited $856,000 in various bank accounts and doubted very much that he had paid a penny in tax on it. Later in the same year, Dewey took on Jack Diamond and successfully prosecuted him for operating a still, for which he received a fine of $11,000 and a four-year prison sentence. In a subsequent trial, Diamond was acquitted, but by the end of the year he had been shot dead.
Over the next two years, Dewey set his investigators onto Dutch Schultz and Waxey Gordon. By early 1933, they had enough evidence to proceed against both mobsters on the basis of tax evasion. Schultz had already got word of the investigation and disappeared. Gordon tried to escape but was captured and went on trial. Before he confronted the multimillionaire bootlegger in court, Dewey and his team had questioned more than a thousand witnesses and investigated the records of some two hundred bank accounts. It was an indication of the thoroughness with which Dewey prepared his cases and served as a model for his later assaults on gangsters.
“Good law enforcement,” said Dewey, “will be procured when competent and trained investigators work, with modern technique and approach to their task, together with competent, vigorous lawyers who are willing to devote long, quiet effort to the investigation and prosecution of crime.”
It was the paper trail and the accumulation of witness testimony that would prove to be his most potent weapons. Waxey Gordon and two of his associates were indicted for tax evasion on an income of $1,618,690 over two years. Presented with such a tight case built on the statements of witnesses who had worked inside Gordon’s business, it took the jury just fifty-one minutes to find him guilty on all counts. Waxey Gordon was fined $80,000 and given a sentence of ten years incarceration. In retrospect it probably saved him from being rubbed out by his fellow gangsters.
Luciano had already been moving in on Gordon’s business earlier that year. A newspaper report described a gun battle in
May in which three passersby were hit in the crossfire at Broadway and Eighty-first Street. “According to the police,” said the report, “the machine-gun battle was between rival gangs headed by Waxey Gordon on one side and by Charles (Lucky) Luciano and Louis Buckhalter, alias Lipke [
sic
], on the other.” In all, the police said more than a dozen men had been killed in the gang warfare. It has even been suggested that it was Meyer Lansky who fed information about Gordon’s tax affairs to the Internal Revenue Service in the first place.
May in which three passersby were hit in the crossfire at Broadway and Eighty-first Street. “According to the police,” said the report, “the machine-gun battle was between rival gangs headed by Waxey Gordon on one side and by Charles (Lucky) Luciano and Louis Buckhalter, alias Lipke [
sic
], on the other.” In all, the police said more than a dozen men had been killed in the gang warfare. It has even been suggested that it was Meyer Lansky who fed information about Gordon’s tax affairs to the Internal Revenue Service in the first place.
By the end of 1933, Dewey’s boss, Medalie, decide to retire and recommended Dewey for his post. Despite the newly empowered Democrats eyeing the position, the Republican Dewey was unanimously elected—at thirty-one years old, the youngest ever U.S. attorney of New York. One headline called him the “Baby Prosecutor.” It was bad news for New York mobsters and everyone knew it—including Luciano. But the Democrats persisted and Dewey was replaced after just a month in the role. As Dewey prepared to make some money in private practice, the Mob dared to hope that their operations would be safer with a more malleable Democrat in the job. But public uproar at the corrupt nature of the Democratic legal regime encouraged the governor of New York to intervene and appoint Dewey as special prosecutor. He was subsequently given free hand as deputy assistant district attorney to pursue his own campaign against organized crime. The heat was back on the Mob.
Dewey moved his operation into the fourteenth floor of the Woolworth Building. A twenty-four-hour police guard was put on the Gothic skyscraper. Special measures were taken to protect witnesses giving testimony: frosted glass installed in partitions in interview rooms; venetian blinds placed on exterior windows; a separate telephone cable led directly to the telephone company to avoid tapping; filing cabinets given special locks. To get the public behind him, Dewey gave a series of radio lectures in which he outlined the impact of crime on the
citizens of New York. It was these talks that built up the legend of organized crime in the city and led eventually to Luciano being branded a master criminal.
citizens of New York. It was these talks that built up the legend of organized crime in the city and led eventually to Luciano being branded a master criminal.
“There is today scarcely a business in New York which does not somehow pay its tribute to the underworld,” declared Dewey, “a tribute levied by force and collected by fear. There is certainly not a family in the City of New York which does not pay its share of tribute to the underworld every day it lives and with every meal it eats. This huge unofficial sales tax is collected from the ultimate consumer in the price he pays for everything he buys. Every barrel of flour consumed in New York City pays its toll to racketeers, which goes right into the price of every loaf of bread. Every chicken shipped into the City of New York pays its tribute to the poultry racket, out of the pockets of the public. There are few vegetable or fish markets in the City of New York where merchants are not forced by sluggings, destruction of goods, threats, and stink bombs to pay heavy toll.”
Dewey was talking about the protection racket, but there was another lucrative aspect of gang rule that also came to his attention—the “Shylock” business. Taking its name from Shakespeare’s Venetian Jew, it was simply money-lending with menaces. The rate of interest was $1 for every $5 borrowed. The gang lenders kept books and sent their collectors to pick up their money every week, many of them walking straight into the officers of borrowers and telling them to pay up. If they refused, a couple of enforcers were sent to beat it out of them.
Dutch Schultz had a considerable interest in the Shylock racket in Manhattan and every day he was in hiding from Dewey he was losing control over his business empire to Luciano and other rapacious gangsters. When he eventually reemerged into the public eye, his clever lawyers managed to get his trial shifted upstate and he avoided conviction, but he still had a score to settle with the attorney.
“Dewey’s gotta go,” he told a gathering of senior mobsters. “He has gotta be hit in the head.”
Luciano and Lansky sympathized with Schultz. The Dewey justice machine was threatening them all, but instinctively they knew that such a high-level hit would bring down on them just the kind of attention they were trying so hard to avoid. Nevertheless, Albert Anastasia of Murder, Inc., was charged with exploring the possibility of assassinating Dewey. The lawyer’s daily routine was observed and one criminal observer staked out his home, borrowing a child from a friend so he could pretend to be playing with his son each morning when Dewey emerged from his house. The attorney was accompanied by two bodyguards, but it soon became clear that he always visited a drugstore to make his first untapped phone call of the day while the bodyguards waited outside. All Murder, Inc., would have to do is place a gunman in the drugstore.
When the proposition was placed before Luciano and his allies, they voted it down. It wasn’t worth the tremendous grief that would explode over them with Dewey’s killing. Dutch Schultz wasn’t happy with the decision and vowed to kill Dewey by himself. Schultz had always been a hothead and his defiance of the Mob sealed his own fate. It was the first real test of his authority and Luciano wouldn’t be found wanting.
On the evening of October 23, 1935, a black sedan carried three hit men into Newark, New Jersey. They had a deadline to beat. They heard that Dutch Schultz was just thirty-six hours away from blasting Dewey. At just after 10:00 P.M., the three gunmen entered the Palace Chophouse. One of them, Charlie “the Bug” Workman, checked out the restroom. Seeing the back of a man he figured was one of Schultz’s bodyguards, he shot him, then strode back into the bar and executed three of Schultz’s close associates as they sat around going over the mobster’s accounts. But none of them was Schultz. Workman suddenly realized it was the guy in the toilet that was his target. He went back and checked he was dead. But Schultz wasn’t dead. He lingered on for another twenty-four hours in hospital before he passed away.
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