Interference (57 page)

The subsequent report also revealed that between 1971 and 1984 Korshak had made over $700,000 from Hilton alone. Korshak was chiefly responsible for handling some tax and real estate matters for Hilton, as well as a number of affirmative action cases.

Realizing that the Korshak connection could cause him severe licensing difficulties, Hilton suddenly fired the attorney. Hilton, through his legal counsel, sent Korshak a letter, stating: “I appreciate very much your understanding regarding the action we feel we're forced to take in dissolving the longstanding relationship between you and Hilton Hotels Corporation. As I stated in our telephone conversation, we very much regret this situation. We feel, however, that we cannot risk jeopardizing in any way the huge investment we have committed to New Jersey …

“You can rest assured that you continue to be held in high esteem and affection by those of us at Hilton who have had the privilege of having you as a friend and adviser.”

In the midst of the opening round of testimony before the casino control commission in July 1984, Barron Hilton received a barrage of hostile questions about his association with Korshak.
Hilton said, “I wish the hell we would have never hired him, because I can see it's a very distinct problem here in the minds of you gentlemen about this fellow's integrity.” In another round of questioning in November, Hilton again repudiated Korshak, who was furious.
⁵

At the conclusion of the hearings, New Jersey gaming commissioner Joel R. Jacobson said, “In my judgment, the … relationship of the Hilton Hotels Corporation with Sidney Korshak is the fatal link upon which I primarily based the conclusion that this applicant has not established its suitability for licensure in New Jersey.”

The commission rejected Hilton's bid on February 28, 1985. The refusal was based solely on Hilton's association with Korshak—whom the commission charged as being “a key actor in organized crime's unholy alliances with corrupt union officials and its pernicious efforts to frustrate the rights of working men and women by infecting legitimate unions, to rob their members' future by stealing the benefits they have earned in the past from honest labor.”
⁶

There was solace for Hilton. Even though he was viewed as unsuitable for ownership of a casino in Atlantic City by the New Jersey Casino Control Commission, he was still suitable enough to continue his minority interest in the San Diego Chargers. The NFL conducted neither a known investigation nor a hearing on Hilton's relationship with Korshak.

The NFL also did nothing to curtail Hilton's corporate sports-gambling activities, particularly the $17.5 million Hilton sports book at the Las Vegas Hilton.

In a promotional brochure, the Las Vegas Hilton boasts of its “magnificent new addition to the Hilton [that] dwarfs anything of its kind. Over thirty thousand square feet—nearly the size of a football gridiron—devoted exclusively to a lavish center for race handicapping and sports wagering.

“The visual display itself is breathtaking. A wall 35' high and 230' in length. Containing 30 giant projection screens and eight 46-inch television monitors for simultaneous viewing of all major sports events and racing from every major U.S. track. Including odds and up-to-the-minute sports handicapping information. There's comfortable seating for over 400 with over 60 seats intended exclusively for sports bettors …

“So whatever the season, whatever your game, you can bet
the action's at the Las Vegas Hilton Race and Sports Super-Book.

Barron Hilton

President, CEO

Chairman of the Board

Hilton Hotels Corp.”

On the inside of the brochure, Hilton uses the team of which he is still part owner as an example for the novice about sports wagering. “You may wager on which team will win the game as adjusted by the stipulated pointspread. This is called a straight wager. In this example, the [San Diego] Chargers are a three-point favorite over the [Los Angeles] Rams. If you wish to wager on the Chargers, three points will be deducted from their final score. Therefore, you are wagering that the Chargers will win the game by
more
than three points. Conversely, if you wish to wager on the Rams, three points will be added to their final score. You are then wagering that the Rams will either win the game or lose by
less
than three points. Should the Chargers win by
exactly
three points, it's classified as a tie and all wagers would be refunded.”

Here, Hilton is not only telling gamblers where to bet on NFL games but how to bet—using a team in which he still has a financial interest as his example. Predictably, the NFL remained silent.

While Hilton was busy institutionalizing his gambling empire, the United States Football League was busy folding up, unable to retain a high-priced television contract. The USFL had challenged the domination of the NFL over professional football—but only momentarily and rather meekly. It could never come up with and keep the biggest stars in the game either through the college draft or by raids on NFL teams. Frustrated by what it considered to be the excessive monopolistic practices of the NFL, the USFL filed an antitrust suit against the NFL in the fall of 1984.

On July 29, 1986, a federal jury in New York agreed with the USFL and found against the NFL. However, the jury awarded damages to the USFL of only $1—trebled to $3. A week later, on August 4, 1986, the USFL team owners, nearly $150 million in debt, suspended play.

In the wake of its guilty verdict, the unrepentant NFL owners
continued to laugh all the way to the bank. Adding insult to injury, just seven months after the USFL called it quits, the NFL signed another astronomical television contract with all three major networks and, for the first time, cable television's ESPN, which had helped carry the USFL through its final season.

49 Trouble in Paradise

AS THE IRS INVESTIGATION began to zero in on Dominic Frontiere—two men, Daniel Whitman, a co-owner of Hollywood's popular Cyrano's restaurant, and cocaine dealer Robert Cohen—were arrested for conspiring to murder Raymond Cohen, no relation to Robert, allegedly to keep him from testifying in the NFL ticket-scalping investigation.
¹

Both Whitman, a close friend of the Frontieres, and Robert Cohen were associates of mobster Jack Catain. The murder plot was discovered when Robert Cohen gave an FBI informant $5,000 in cocaine to make the hit. Upon his arrest, Robert Cohen agreed to cooperate with the government. Federal investigators told Cohen to call Whitman and say that the murder of Raymond Cohen had been committed. The call was secretly tape-recorded by the government.

Included on the tape was Whitman's statement that Raymond Cohen had to be killed because he was informing on several “heavyweights out of Chicago” who were involved in Mafia activities on the West Coast. He said that Catain was among them. Believing that Raymond Cohen was dead, Whitman added, “If it means anything to you, let me tell you what was done was sanctioned … Those things [murders] don't just happen unless you get it cleared.” Telling Robert Cohen on the telephone that he had been approached by federal agents, Whitman said he told them, “Do you want to talk to me about Dan Whitman, sit down. You want to talk about Ray Cohen, Jack
Catain, Dominic Frontiere … I don't want to talk to you guys about it.”

“Whitman had a subhuman personality,” Treasury agent Gerald Petievich, who headed the Secret Service's counterfeiting investigation of Jack Catain, told me.
²
“He was trying to make a reputation for himself with the underworld. He was talking tough, and this situation gave him the opportunity to do something that would get him respect. That was the reason for the murder contract.

“There was a meeting with the Strike Force [in Los Angeles]. My suggestion was to show that the murder was the intent. I wanted to show Whitman a picture of a dead body. So we took Ray Cohen over to a Burbank studio and had a makeup man make him up with a hole in his head. It looked so realistic. Then we drove up by Universal Studios and had him lie in the bushes up in the hills. And we took a picture of him lying there. Then, in case that didn't work, we took him down to the morgue and had him lie on a slab. We put a sheet over him.

“They were very realistic photos. They were shown to Whitman by [Robert Cohen], who said, ‘Hey, I did it.' And he showed him the photograph [of Cohen's acting dead in the hills]. When he saw the photograph, Whitman said, ‘Oh yeah, that's good.' And [Robert Cohen] was wired and got him on tape. The meeting was inside Whitman's restaurant, and the theme from
The Godfather
was playing in the background.”

Would the murder of Ray Cohen have benefited Dominic Frontiere? Strike Force prosecutor Bruce Kelton of Los Angeles says, “I can't say that. What I can say is that the evidence in the case showed that Whitman had hired some people to kill Cohen. In cryptic conversation, he indicated that Cohen had been cooperating with Treasury agents. Our argument to the jury was that all this had happened after the Treasury agents had approached Whitman to question him. But as far as whether the murder would have helped Frontiere, I have no comment on that. I have no evidence that he was a part of any attempt to murder anybody.”

The following year, on March 9, 1984, Raymond Cohen testified in court during Whitman's trial that he had given money from the ticket-scalping scheme he and Catain were operating to Dominic Frontiere, who was also the source of the tickets. Frontiere had repeatedly denied being involved in the ticket-scalping
scam. Whitman was convicted of attempted murder and sentenced to eight years in prison.

By the end of the year, the screws began to tighten on Frontiere when a federal judge ordered Catain to appear before a grand jury investigating the ticket-scalping allegations. Catain—who, like Whitman, was given immunity from prosecution in the case—had earlier refused to talk because of a reported heart condition. Both Whitman and Catain finally testified, as did Pete Rozelle on behalf of the NFL. These testimonies remain sealed.

On June 19, 1986, Dominic Frontiere was indicted by the federal grand jury on three counts of failing to report over $500,000 in income he had received from the scalping of the 1980 Super Bowl tickets. He was described by a federal prosecutor as “a major white-collar criminal.”

According to the indictment, Frontiere had failed to include on his and his wife's 1980 joint income-tax return their income from the sale of Super Bowl tickets above the $397,000 claimed. Instead of reporting their total profit from the sale of the tickets, the couple had taken a $116,335 deduction for supposedly giving them away.

Federal investigators had also learned that Georgia Frontiere had all twenty-seven thousand of the Rams' allocation of Super Bowl tickets delivered to her house. When it was discovered by team accountants that over thirty-two hundred tickets were missing, Mrs. Frontiere told them that she had given them to her friends at no charge. However, she could not produce a list of who those friends were, and prosecutors had evidence that she had specifically ordered that no complimentary tickets be given to anyone—even members of the Rams management staff.

Despite the fact that she was also implicated in the scheme in an affidavit by Jack Catain, Mrs. Frontiere was not indicted and insisted that she was completely unaware of her husband's activities—despite the fact that the deductions were listed on their signed, joint income-tax returns.

Catain's affidavit revealed that “Danny Whitman clearly stated that Dominic and Georgia Frontiere wished to have my assistance in scalping tickets for the Super Bowl on a yearly basis and preferred to have a lump sum payment from myself with me to be responsible for distributing them to ticket agencies and various other outlets.” Catain, who refused to sign the affidavit unless he was given a deal by the government, added that it was
Dominic Frontiere who earlier instructed him and Raymond Cohen to muzzle Rams executive Harold Guiver.

Los Angeles attorney Tony Capozzola, who solicited Catain's statement, told me, “I am convinced that Jack Catain was telling the truth. But I also believe that many of the facts in this case will never be clarified because of the unbelievable twists and turns the investigation took. I know that there are a lot of people who are not satisfied by the explanations given to date.”

Bruce Kelton told me, “The Frontiere tax case had nothing to do with who was giving us information. The reason Georgia Frontiere wasn't indicted was that the investigation was about knowingly making false statements on income-tax returns. And there was not sufficient evidence to indict her with respect to that particular charge. It was a different story with Dominic. He and Ray Cohen were going around selling Super Bowl tickets. In his case, there was clear intent.

“Don't think we didn't look at Georgia. We did. We looked at every angle of that case and spoke to almost every NFL owner of every team and to Pete Rozelle several times.” All these statements by Rozelle and the NFL team owners also have been sealed.

Four months after his indictment, the fifty-five-year-old Frontiere pleaded guilty, insisting that he received only $88,000 of the money from the sale of the tickets. The rest, he claimed, was extorted by Catain and Ray Cohen, the chief witnesses against him.
³
In a plea-bargaining arrangement, Frontiere admitted to two counts of income-tax fraud. The third count for obstruction of justice was dropped. Facing a maximum eight-year jail term, he was sentenced to one year in prison and fined $15,000.

At his sentencing, Frontiere told the judge, “I swear to you, I didn't know what I was doing was illegal … It seemed like a way to make a lot of money that wasn't illegal.” U.S. District Judge William D. Kellett was skeptical and replied, “At best, it's a bizarre story. At worst, I'm not being told the truth.”

Immediately after Frontiere copped his plea, the NFL announced that it was finally going to conduct an “administrative review” of the circumstances revolving around the ticket-scalping situation in the NFL. Predictably, nothing more was heard from the NFL on this subject.