Playboy's History of Organized Crime Part XI: Attack on a Hoodlum Empire

We're going after you, Hoffa, in Part XI of Playboy's History of Organized Crime attack on a Hoodlum Empire

Power, and the compulsion to acquire it, Robert Kennedy understood very well. Few families in American history had been more obsessed with power, had sought it with greater passion than his. But what counted with the Kennedys was how power once won was used. For them, it was a means of ordering events and changing them, to have some say over their own destiny and the nation's. Thus, Robert Kennedy could never quite understand, had no sympathy for those who sought power only as a means of enriching and aggrandizing themselves.

Perhaps as much as anything else, it was his moral outrage at the misuse and corruption of power that made him instrumental in the war against organized crime during the last decade of his life. He was in unique positions to fight the Mob, first as chief counsel to the Senate Select Committee on Improper Activities in the Labor or Management Field, chaired by Senator John McClellan of Arkansas, and then as U. S. Attorney General, under his brother President John F. Kennedy.

It was as counsel to the McClellan committee in the late Fifties that Robert Kennedy got his first close look at the entangled relationships between supposedly reputable labor leaders and the underworld. The committee's charter gave it wide latitude to investigate labor racketeering and the uses and abuses of unions' pension and welfare funds. In that endeavor, the committee called to testify a motley crew of labor leaders who had arrogantly abused the power and money entrusted to them by their followers, who had entrenched themselves in office by packing union hierarchies and local offices with men whose criminal activities and associations filled pages in police records. There were outcries from some that the committee, especially its chief counsel, was antilabor, that the purpose of the investigation was to destroy the labor movement, but it soon became evident that if anyone had been antilabor, it had been the leaders who had so loudly proclaimed their devotion to unionism.

There was, for instance, Max Block, president of the Butchers District Council of New York and New Jersey of the Amalgamated Meat Cutters and Butcher Workmen. He had used that position to milk the union treasury of more than $500,000 between 1954 and 1957; he had used it to convince executives of food chains such as Bohack, A&P and Grand Union to give him stock as gifts, to give his relatives lucrative contracts for supplies. The only one who benefited from Block's leadership of the butchers' union was Block; gains for the workers were minimal at best.

Block's looting of the butchers was matched, if not exceeded, by James Cross in the Bakery and Confectionery Workers International Union, by Maurice Hutcheson and his friends in the United Brotherhood of Carpenters and Joiners, by a string of officials in the International Union of Operating Engineers, the Sheet Metal Workers International Association, the Textile Workers Union and others.

There was the Chicago Restaurant Association, whose corruption and underworld ties nobody seemed even to bother hiding. One of its prime locals was controlled by Joseph Aiuppa, a member of the Chicago mob's ruling council with a criminal record going back to the days of Al Capone. The union's counsel had been Abraham Teitel-baum; he told a committee investigator that as far as he was concerned, Capone was "a line gentleman." And the ruler of the entire association was Louis Romano. His record: close and continuing association with Chicago mob leaders Tony "Big Tuna" Accardo and Sam Giancana, frequent arrests for everything up to and including homicide. When questioned about a number of murders, he snarled, "Why don't you go and dig up all the dead ones out in the graveyard and ask me if I shot them, you Chinaman?"

But the main thrust of the McClellan committee was directed at the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers, the nation's largest trade union, with more than 1,600,000 members at that time. What concerned the committee most was hoodlum control of locals and the activities of the Teamsters' two most powerful officers, president Dave Beck and James Riddle Hoffa. As chairman of the Central States Conference, Hoffa was the man who really ruled the union and who would soon become its president.

Dave Beck was an almost pathetic figure. Once he had been a respected and aggressive labor leader; he had founded the Western Conference of Teamsters and had been a tough and effective bargainer, negotiating contracts that set the standards for the other conferences around the country. But the acquisition of great power corrupted Beck almost beyond reason. With his ascension to the presidency of the international union in 1952, he turned into little more than a cheap crook; the union treasury became a source of easy loans he never had to repay; the union itself bought his house at a vastly inflated price and then gave it back to him for his life-time personal use; his union office permitted him to hold up companies such as Fruehauf Trailer for huge loans. He went before the committee declaring, "1 have nothing to fear. My record is an open book." Then he look refuge in the Fifth Amendment more than 200 times. When he walked out the door, he was a broken man and soon an imprisoned one.

"The fall of Dave Beck." the committee said, "from a position of eminence in the labor-union movement is not without sadness. When named to head this rich and powerful union, he was given an opportunity to do much good for a great segment of American working men and women. But when temptation faced Dave Beck, he could not turn his back. His thievery in the final analysis became so petty that the committee must wonder at the penuriousness of the man. What would cause a man in such circumstances to succumb to the temptation of using union funds to pay for six pairs of knee drawers for $27.54, or a bow tie for $3.50? In Beck's case, the committee must conclude that he was motivated by an uncontrollable greed."

It was not so easy to dismiss or sum up Jimmy Hoffa. He was, and is, a strange and complex man whose compulsion to power probably matched the Kennedys', though he used it in a profoundly different manner. Born poor, he left school at l6 to take a laboring job--unloading boxcars in Detroit for 17 cents an hour. Within two years, he had led a successful strike and been granted a charter to form a Teamster-affiliated local in Detroit. The world in which he lived and flourished was a violent one and he luxuriated in it. "I was in a lot of fights." he boasted, "got my head broke, got banged around. My brother got shot. We had a business agent killed by a strikebreaker.... Our cars were bombed out.... There was only one way to survive--fight back." And fight he did, clawing and gouging his way to so much power in the Teamsters that when Beck was president, Hoffa could snort. "Dave Beck? Hell, I was running it while he was playing big shot. He never knew the score."

In some ways, Hoffa was the equal of the United Auto Workers' Walter Reuther, proving himself one of the ablest leaders to arise out of the labor movement. Smart, tough, clear-eyed and totally dedicated to his own ultimate ends (he didn't smoke, drink or chase women; his only passion other than the union and his own position was physical fitness), he was a master of collective bargaining. Under his leadership, Teamster members scored huge economic advances, won fringe benefits that became a model for labor in general. He was a supreme organizer whose skills brought thousands in totally disparate fields into the Teamster empire; and he consolidated and concentrated union power in his own hands.

But what Hoffa lacked, and what brought him the deep and abiding scorn of Kennedy and of labor leaders such as Reuther, was principles. If Reuther or the Kennedys set certain moral limits, however ill defined, on the means to achieve power and on the uses of that power, Hoffa set none. He plowed Teamster money, in the form of rarely repaid loans, into grandiose but ill-conceived land-development projects in Florida, into gambling casinos and other enterprises sponsored by his racketeer friends in Nevada. He invested Teamster funds in companies employing Teamsters and he invested his own and his family's money to take control of companies whose workers were members of his union. "I find nothing wrong with a labor leader having a business or his family having a business that may be in the same industry that that particular union has organized," he blandly replied to a question from Kennedy. And he apparently saw nothing wrong, either, with borrowing money from other Teamster officials whose tenure depended on his good will, or from companies whose prosperity and continuing labor peace depended on his whim.

To consolidate his control over the union and to expand his power, Hoffa turned to the hoodlums who had infested the union, who had been grained charters to organize and run Teamster locals. The committee came up with a list of 47 "gangsters and racketeers about whom there is testimony regarding association with Teamster officials." Hoffa, it charged, "runs a hoodlum empire, the members of which are steeped in iniquity and dedicated to the proposition that no thug need starve if there is a Teamster payroll handy.... Hoffa does not now have nor has he ever had any intention of moving against his racketeer friends...he has never moved to exercise his powers even after convicted union officials have gone to jail and even though they continue to hold office and draw salaries and even Christmas bonuses while they languish in jail."

Scoffed Hoffa in reply: "I would take each man on his own. The mere fact that he happened to know somebody would not necessarily stop me from hiring him even though the people he knew were so-called alleged gangsters.... I've saw too many alleged gangsters who, when you checked on the actual persons alleged to be gangsters, had no more to do with being a gangster than you are a gangster.... I don't even know a Syndicate exists, and I don't believe you do, either."

Who, then, were some of these "alleged gangsters" hired by Hoffa? The roster reads almost like a rogues' gallery. The business manager of Teamster Local 102 in New York, for instance, was John "Johnny Dio" Dioguardi. His ties to the Syndicate went back as far as his strong-arm days for Louis Lepke: he had been arrested for and convicted of labor shakedowns, extortion, tax evasion and bankruptcy fraud; he was accused of having ordered the acid blinding of crusading labor columnist Victor Riesel in 1956. "It cannot be said, using the widest possible latitude," the committee noted, "that John Dioguardi was ever interested in bettering the lot of the workingman."

The president of Teamster Local 560 in Hoboken. New Jersey, was a man named Anthony "Tony Pro" Provenza no. Among his closest friends were Carmine "Mr. Gribbs" Tramunti, Tony Bender and Antonio "Tony Ducks" Corallo. Corallo himself was a Teamster official in good standing, vice-president of one local in New York and the absolute if unofficial ruler of at least four others. Did Corallo's long arrest record, his earlier narcotics conviction or the fact that his puppets held union office concern Hoffa? The New York police taped a conversation between Corallo and another union official, who said of Hoffa, "The guy told me straight out, and I ain't making, like, my own words, I'm saying his words...'You want to steal, you want to rob, go ahead,' he says, 'don't get caught.'... The guy is, you know, fine. I mean, he don't care one way."

It was not just that Hoffa didn't care. In Los Angeles, the secretary-treasurer of Teamster Local 396, with jurisdiction over private garbage collections, was a hoodlum named Frank Matula. When Matula was convicted of perjury before a California state-assembly committee, Hoffa responded by appointing him to the Teamster board of trustees, traditionally known as the "conscience of the union." and later even persuaded prison authorities to grant Matula a furlough so that he could help audit the books of the international union.

"Malodorous as the Los Angeles garbage situation has been," the McClellan committee noted, "it seemed sweet-scented by comparison with conditions in the New York sector of the industry." In that city, the boss was Vincent Squillante, reputed narcotics peddler and executioner for hire to others in the (continued on page 173)Hoodlum Empire(continued from page 136) underworld. But despite that reputation and union office, he was still able to pull down $10,000 a year on the side as labor-relations counsel to the Greater New York Cartmen's Association. Soon he was the dominant figure in both labor and management in the garbage business. And to edit the industry's trade paper, The Hired Broom (slogan: "Out of garbage there grows a rose"), Squillante hired an ex-convict turned scholar named C. Don Modica. Modica also was private tutor to the children of Joe Adonis, Willie Moretti and Albert Anastasia and he became something of a watchdog for the Anastasia interests. When Anastasia was murdered, Modica found it expedient to throw up his job in garbage and retire to his New Jersey home in order to, he explained, write a treatise on such American perils as progressive education, delinquency and communism.

Then there was the situation in Yonkers, the Westchester County city abutting the Bronx. When the city fathers decided to dump municipal garbage collection in favor of private cartage, they handed the contract to the Westchester Carting Company. Its president was Alfred "Nick" Ratteni, a convicted burglar and narcotics suspect. Though Teamster Local 456 had jurisdiction in Yonkers, Ratteni signed a labor contract with New York City Local 17, whose secretary-treasurer was Joseph Parisi. Parisi had a record of 11 arrests ranging from disorderly conduct to rape and homicide and his Mob ties went back to his working with Lepke and Lucky Luciano in labor extortion. The Ratteni-Parisi agreement might have gone off without a hitch had not Local 456's president, John Acropolis, objected lo the encroachment into his local's preserve. When Acropolis refused to give in to threats, he was informed by one local Teamster official, "You are not that tough. Tougher guys than you have been taken care of." And Acropolis was taken care of. A few weeks later, he was gunned down as he stepped out of his home. There were no further complaints.

Gangster influence in and infiltration of the Teamsters existed not just at the local levels. It permeated the central chain of command as well. The credentials of Robert "Barney" Baker that had brought favorable notice from Hoffa and other Teamster leaders included a stint as a professional boxer, a longshoreman's job and a term in prison for stink-bombing a New York theater. He had been a close friend and working partner of John "Cockeye" Dunn, a New York--waterfront hoodlum who wound up in the electric chair, and he had worked as a bouncer in a casino for Adonis, Meyer Lansky, Frank Costello and Vincent "Jimmy Blue Eyes" Alo. Like so many other thugs, he found shelter in the house of the Teamsters, hiring on at one point as a driver in Washington, D.C., a job that led to his elevation to union office in Local 730. But Teamster leaders had bigger things in mind for Baker, and so he quit that post and moved to the Midwest, where he became an organizer for Hoffa's Central States Conference. When Kennedy questioned Hoffa about Baker's background, asking, "Does that not disturb you at all?" the Teamster boss replied, "It doesn't disturb me one iota."

Nor, apparently, did the fact that among Baker's close friends and fellow Teamster leaders was John Vitale, ruler of Local 110 in St. Louis, who was widely regarded as the Mob boss in that city.

As the evidence about hoodlum infiltration of the Teamsters and Hoffa's alliance with the Mob piled up, a determination grew in Kennedy. So morally repellent did he find Hoffa that he became obsessed with the desire to see him in prison. And that obsession grew as Hoffa seemed to live a charmed life, successfully defeating indictments growing out of charges that he had wire-tapped the phones of union officials and that he had illegally received documents belonging to the McClellan committee.

Once Kennedy became Attorney General in January 1961, the drive against Hoffa--which some saw as little more than a personal vendetta, in which illegal means were used to attain what few would deny was a just end--accelerated. Scores of grand juries were impaneled to investigate Hoffa's multifarious activities. A special unit in the Justice Department was set up, with the sole aim of getting the goods on Hoffa. That work finally paid off. In 1962, Hoffa went on trial for demanding and receiving improper payments from a company employing Teamsters. That trial ended in a hung jury, but then Hoffa was tried for attempting to bribe one of the jurors. On that charge he was convicted and sentenced to eight years in prison. In 1964, he was convicted once again, this time for improperly obtaining $20,000,000 in loans from Teamster pension funds and diverting $1,700,000 to his own use. When all the appeals on both convictions had been disposed of, Hoffa faced 13 years in prison. In March 1967, he entered the gates of Lewisburg Federal Penitentiary in Pennsylvania to begin serving his time.

• • •

The "Get Hoffa" campaign was only one of Kennedy's obsessions as Attorney General. Another was organized crime as the country's political and social cancer, about which he had begun to learn so much while counsel to the McClellan committee. Getting Hoffa was the simpler job. Organized crime had thrived during the Eisenhower Administration partly because the enforcement arm of the Justice Department, the FBI, was led by J. Edgar Hoover, who had long insisted there was no such thing.

Kennedy, then, had two jobs. One was to get the Justice Department involved, and this he did by setting up an aggressive Organized Crime and Anti-Racketeering Section staffed by young and ambitious lawyers. The other was to somehow persuade Hoover that the Syndicate did, indeed, exist. Into his hands fell the tool that led to Hoover's grudging conversion, if not to his immediate involvement.

All his life, Joe Valachi had been a punk. From the time he was 11 and hit a teacher with a rock, for which he wound up in reform school, he had labored with no great success in the vineyards of the underworld, a common worker whose major claim to stature was his marriage to Mildred Reina, daughter of one of the early Mafia leaders slain in the Thirties during the Castellammarese war. By June 1962, Valachi's fortunes had reached their nadir. He was serving a term in Federal prison in Atlanta for narcotics trafficking; there were rumors that he had turned stool pigeon; his cellmate and longtime boss, Vito Genovese, believing those rumors, had given him the kiss of death; he had narrowly escaped three attempts on his life and was certain a fourth would not be long in coming. Valachi was in a panic, and he was certain he knew to whom Genovese had given the contract for the next try at him. In the exercise yard one day, he thought he saw that would-be assassin; picking up an iron pipe, he raced across the yard and beat the man to death. Valachi had picked the wrong man; his victim was only a smalltime forger with no Syndicate connections; he just happened to look like somebody else.

That mistake, Robert Kennedy would say later, provided the "biggest single intelligence breakthrough yet in combating organized crime and racketeering in the United States." For, in the weeks that followed, in peril from all sides--the Government had a murder indictment against him, his underworld friends had a murder contract out on him--Valachi became what the rumors, until then untrue, had said he was, an informer. And he was probably the most important public canary since the days of Abe Reles and his revelations about Lepke, Anastasia and others in Murder, Inc., 20 years earlier.

Blessed with instant recall of almost every event in his life, and seething with hatred of Genovese and a determination to wreak revenge, Valachi spun out all he knew about organized crime for the Bureau of Narcotics and Dangerous Drugs, the FBI, the Justice Department and, in the fall of 1962, for the public before Senator McClellan's Permanent Subcommittee on Investigations.

What he provided was not a view from the top but the worm's view. It was, however, a view that spanned the decades, from the time before the Castel-lammarese war through the consolidations and modernizations of Luciano to the intrigues of Genovese and on and on. He might never have been present when the leaders made decisions and formulated policies, he might not have known firsthand of the rivalries and enmities among Syndicate rulers, he might have been unaware of the deep influence and high position of non-Italians. But, like a soldier in the field, which he was, Valachi helped turn the established policy into reality; he had heard all the rumors and secondhand stories, had heard the versions favored by those he served, had speculated on all the nuances and the reasons for changes in direction, on the rise or fall from grace of various superiors. Now he spun out this blend of rumor, speculation and personal knowledge. He could recite a Who's Who of the underworld, reveal the existence of five major crime families in New York and others around the country, tell who had killed whom and why (or at least the reasons he had been told), explain how policy had been implemented and, in the process, clear up many long-standing mysteries.

The tales that Valachi recited came as a shocking revelation to much of the country and to the Senators on the McClellan subcommittee. But for Kennedy and his anticrime unit, the tales were neither new nor particularly startling. In the Justice Department's files rested the voluminous history recited by a self-exiled mafioso named Nicola Gentile. Unlike Valachi, he had been high in the Syndicate councils during the Twenties and Thirties and so had direct knowledge of and insight into the tangled events Valachi had witnessed from a much lower level. During the Eisenhower Administration, Gentile in his Sicilian exile had rambled on about his life and times to a special unit of the Justice Department. But nothing had been done with his story. When Kennedy took office, the Gentile memoirs were resurrected, both as a check against Valachi and for an even more important purpose. And it was in this area that Valachi provided his really important breakthrough.

By rights, the war on organized crime should have been directed by Hoover. But he had no more enthusiasm for that struggle, nor any more belief in it, than he did for investigating civil rights violations or for protecting the lives of civil rights demonstrators south of the Mason-Dixon line. But when a soldier of the underworld got up in front of the television cameras and proceeded to draw Organization charts, recite names, places and events in excruciating detail, Hoover was, however reluctantly, forced to change his mind. That change was made a little easier when wire taps and other listening devices provided the Justice Department with a new name by which to "discover" organized crime. In their conversations, mobsters had at times talked of "our thing" or, when speaking in Italian, of cosa nostra. Of course, it would not do to call the Organization Our Thing--that sounded more humorous than menacing. But to call it Cosa Nostra or, better yet, La Cosa Nostra, or simply L.C.N., gave it a ring of sinister authenticity in an English-speaking world.

Acting as though he had suddenly come upon the much-rumored but consistently disbelieved mother lode. Hoover was galvanized into action--or, at least, inspired to make stentorian public pronouncements. "La Cosa Nostra." he was soon intoning, "is the largest organization of the criminal underworld in this country, very closely organized and strictly disciplined.... It operates on a nationwide basis, with international implications." To combat and defeat it, he would say repeatedly, would take all the forces at his command (not to mention a larger budget) and he was sending armies of FBI agents to war against L.C.N. with the kind of intense and total dedication that had long marked his fight against domestic Communists. (This new war on organized crime, marching side by side with Hoover's continuing war on domestic Reds and other radicals, also gave him an easy alibi when the bureau was criticized for ignoring the civil rights struggle in the South. Hoover merely explained that he didn't have the funds or the agents to divert from these other, major battlegrounds. A few years later, though, when the peace movement gave rise to demonstrations against the war in Vietnam, he somehow found plenty of agents to throw into the fight against peaceniks and other social rebels.)

At first, Hoover's efforts in the organized-crime war were mainly confined to sending out publicity releases. Instead of FBI shock troops, spurred by an aroused director, using their wire taps and bugs (legal and illegal), their informers, computers, files and all the rest of the crime-fighting arsenal developed by the bureau and turning the evidence over to the prosecutors, the G men balked and their director sulked. As former Attorney General Ramsey Clark noted, once Robert Kennedy took the lead, the FBI stayed on the side lines until he had left the Department of Justice: "The conflict between Attorney General Kennedy and the FBI arose from the unwillingness of the bureau to participate on an equal basis with other crime-control agencies. The FBI has so coveted personal credit that it will sacrifice even effective crime control before it will share the glory of its exploits. This has been a petty and costly characteristic caused by the excessive domination of a single person, J. Edgar Hoover, and his self-centered concern for his reputation and that of the FBI."

But even Hoover's foot dragging, though it hurt, did not stop the Justice Department from opening the war. There was Attorney General Kennedy lobbying strenuously and effectively to get through Congress a host of strong new legal weapons. There was the anti-crime division striking out in sudden and massive campaigns against specific targets in the underworld--illegal gambling centers in Florida, Kentucky, Arkansas and elsewhere were closed up tight and some of the operators, though not the real rulers like Lansky, were sent to jail; gangster-dominated union locals were harassed and broken and their rulers sent into courts and prisons.

The years that Robert Kennedy ran the Justice Department were years of frantic and often effective activity, and his hit-and-run tactics seemed to keep the Syndicate constantly off balance and in confusion. By the time he left office in 1964 to run for the Senate from New York, the number of Federal indictments for organized criminal activity had climbed from 19 in 1960 to 687. But with his departure, the Justice Department's efforts again slacked off; the interests of the new Attorney General, Nicholas B. Katzenbach, seemed directed toward advising President Lyndon Johnson more on the war in Vietnam than on the war against crime. Then in 1967, the battle was stepped up once more, with the arrival of Clark as Attorney General, bringing with him a dedication to defeat organized crime equal to Kennedy's and a new weapon to attack it--Federal strike forces, set up on a semipermanent basis in a number of major cities.

"A strike force," Clark explained, "gathers and analyzes all available police intelligence about organized crime--its leaders, subordinates and activities--in a target city. By collecting relevant data possessed by all law-enforcement agencies operating in an area, an immediate and substantial reservoir of information is available for designing a plan of attack."

By the time Clark left office and Attorney General John Mitchell moved in, the work of the strike forces was resulting in more than 1000 indictments annually against members of the Syndicate, though lumped with that figure was a helter-skelter assortment ranging from street-corner narcotics pushers all the way to Carlo Gambino. Further, during the Kennedy-Clark era, massive files were accumulated on more than 300,000 Syndicate-connected businesses and businessmen. Fortunately, there were some very able prosecutors, such as Robert M. Morgenthau, the United States Attorney for the Southern District of New York, who knew what to do with the evidence. Fortunately, too, the strike forces (continued on page 178) Hoodlum Empire (continued from page 175) were under the control of essentially nonpolitical career officials in the Justice Department, such as Henry Petersen, head of the organized-crime section. These were men who stayed on from one Administration to the next, and so even after Nixon and Mitchell assumed power in 1969 (and denounced Clark, as being soft on the criminals), the work of the strike forces went on relatively unimpeded and some of the fruits of six years of labor began to ripen and fall.

And by then, even the FBI was deeply involved, though that involvement was concentrated along a narrow trail. Kennedy, Clark and their people at Justice had developed considerable sophistication. They were aware of the vastness and complexities of organized crime--spreading across ethnic lines and encompassing violent as well as victimless crimes, pandering to the illegal appetites of the public and infiltrating and controlling unions and businesses, controlling nickel-and-dime policy and international gambling, putting money onto the streets from loan sharks and legitimate lending institutions. Hoover was more simplistic. The song of Valachi had apparently convinced him that behind every crime was an Italian or a Sicilian, all wrapped in the cloak of La Cosa Nostra. And the Italian underworld initially did nothing to dissuade Hoover of this certainty. The Gallo-Profaci war and the other violent struggles for power in the Italian underworld during the Sixties made him certain that his view was the correct one.

So the main thrust of the attack was directed against the Italian-dominated branch of the Syndicate. But even with such a clear target, it was no easy thing to win victories over men who had spent their lives covering their tracks, erecting shelters of respectability and cultivating friends in high places, including Congress. It took years of hard and often frustrating work, accumulating evidence bit by bit, before a case could be made. There were some victories, of course. One of the weapons Kennedy had at his disposal was an immunity statute whereby a hoodlum, if granted immunity from prosecution, could not refuse to testify before a grand jury on grounds of self-incrimination. That law was used effectively against the Lucchese family in the years when Tommy Lucchese was in failing health and then immediately after his death. Vincent John Rao, a top Lucchese lieutenant, went to prison for five years for perjury when he decided to lie before the grand jury when granted immunity. Lower-ranking members of the Lucchese family gave in and talked, and the evidence they provided resulted in convictions of Johnny Dio for bankruptcy fraud, James "Jimmy Doyle" Plumed for tax evasion and Tramunti for contempt. When Tramunti got out of prison, he moved to the leadership of the Lucchese family, with the blessings of the ruler of the Italian underworld, Carlo Gambino.

And, of course, there was Corallo, Teamster racketeer, strong-arm man and fixer extraordinary. One of Corallo's fortes was corrupting public officials, and that ability led to the messiest scandal in the administration of New York's then-Republican reform mayor John V. Lindsay, in 1967. Even before then, Corallo had spent some time behind bars for practicing that vocation; in 1961, he had bribed a New York supreme-court judge, J. Vincent Keogh, and a former Chief Assistant U. S. Attorney for Brooklyn, Elliott Kahaner. All three went to Federal prison. No sooner was Corallo back on the streets than he found a new pigeon, this one named James Marcus, the water commissioner in the newly elected Lindsay administration.

On the surface, Marcus seemed anything but a likely target for a bribe. He appeared the impeccable public servant, devoted to selfless service and already tabbed to head a new superagency dealing with all of New York's environmental problems. According to the propaganda emerging from the Marcus offices, the new water commissioner had had a sparkling career in investments, had headed a major subsidiary of Interpublic, Inc., the huge public-relations firm, and was a brilliant administrator. His social connections, too, were exemplary. He was married to Lily Lodge, the actress daughter of John Davis Lodge, former governor of Connecticut and Ambassador to Spain; her uncle was the estimable Henry Cabot Lodge of the Massachusetts Lodges; and Mayor Lindsay himself was the godfather of one of the Marcus children.

But behind this sterling image was the real Marcus, a man whose career was marked by one failure after another, from flunking out of college to disastrous business dealings; and a man who was weak, greedy and displayed little moral fiber. By the time he took over the water department in 1966, he was deeply in debt, heavily into the stock market on margin and seeing his investments turn sour, while his interest to his brokers climbed to more than $1600 a month.

By then, though, Marcus had a friend. His name was Herbert Itkin, a self-proclaimed labor lawyer (whom no other New York labor lawyer had ever met). Itkin's labor law was of a special kind. He served as middleman in the passage of bribe money from hard-up businessmen to corrupt union officials, money paid to obtain large, and rarely repaid, mortgage loans from union treasuries. It was a calling that Itkin had been led to by a sometime friend, mafioso Jimmy Plumeri, who was then anxious to make a killing on some Teamster treasury money under his control. But on the side, Itkin was something else again. He was, he claimed, an undercover agent and informant for both the CIA and the FBI, though his information always seemed to be passed along after the fact, and after he had made his pile in the deals he informed about.

Marcus and Itkin had come together during the Lindsay campaign, when Marcus was seeking union endorsements for the Republican mayoral candidate, no easy undertaking in Democratic New York. Itkin had just the contacts Marcus needed, turning him on to Daniel Motto, president of a Queens local of the Bakery, Confectionary and Food International Union (a local that had been thrown out of respectable labor's house because it was under the control of Motto and other hoodlums). Motto obliged, selling up something called Labor's Nonparlisan League, which threw its support to Lindsay. He did even more. At Itkin's urgings, he lent the desperate Marcus enough money to gain him a little time.

Thus, when the moment came for a little financial finagling--which would line Motto's and Itkin's pockets and might also solve Marcus' pressing troubles--Marcus was easily persuaded to cooperate. The Jerome Park reservoir in the Bronx urgently needed cleaning, a job that might cost the city $1,000,000 (it actually cost $800,000-plus). Because of the urgency, it was also the kind of job that could be let, despite its size, without formal bidding, just by the water commissioner's assigning a so-called emergency contract to a qualified company.

The potential for graft in such an undertaking did not escape Marcus or Itkin or Motto. Nor did Motto and his close friend Corallo fail to appreciate the control that a little graft would give them over a rising politician like Marcus in the event Lindsay ended up in the White House (where it was evident his ambitions were directed) and took Marcus to Washington with him. The reservoir would be the tie that bound and would lead to bigger and better opportunities for graft.

A job the size of the reservoir, though, was a little out of Motto's league. It called for somebody with a lot more clout, somebody like Tony Ducks, who obligingly announced that he would do all the arranging. The graft would come to five percent of the contract--eventually, $42,000. Marcus could get $16,000 (just enough to take care of some of his most pressing needs but not enough to get him clear), while Motto, Corallo and Itkin would divide the rest. That graft would come from Henry Fried and his S. T. Grand Company, which, as it happened, was actually qualified to handle the reservoir-cleaning job--in fact, had been recommended for the job by one of the water department's engineers.

The reservoir payoff was the start. As Marcus' needs kept spiraling, Itkin kept coming to the rescue. He found some friendly loan sharks willing to advance Marcus some costly cash. Thus, when the potential for the biggest killing of all presented itself, Marcus needed no urging. Consolidated Edison Company of New York was trying to get permission to rebuild some transmission lines into the city, and water commissioner Marcus was the man to grant that permission. The cost of the work was going to run well up into the millions, and the possibilities of diverting some of that cash into a few private pockets were not lost on Marcus, Itkin or Corallo, nor on Fried, either, who saw in the power of the Marcus pen some opportunities for himself. The figuring went that if Marcus delayed signing the authorization long enough, Con Ed would become desperate, would be willing to pay whatever graft was demanded, would be willing, even, to give Corallo a profitable contract to haul used copper from its plants and give Fried a lot more business than the $5,000,000 to $10,000,000 he was then doing for the utility.

But to approach Con Ed would take somebody of considerably greater stature than Corallo. Such a man was Carmine DeSapio, once the all-powerful leader of Tammany Hall and still a politician to be reckoned with. DeSapio might be a Democrat and Marcus an officeholder in a Republican administration, but when it came to things like money and graft, nobody cared much about politics. Besides, the spoils in New York had been split along nonpartisan lines for decades, the only real friction among the political bosses arising during the months preceding an election.

In his discreet way, DeSapio made the approaches to Con Ed, to persuade the utility that the way to do business with Commissioner Marcus was to line his pockets and the pockets of his friends, including DeSapio himself. As one witness later described a luncheon meeting at the fashionable L'Aiglon restaurant on Manhattan's East Side, "Mr. DeSapio said he knew the Department of Water Supply and Con Ed were two vital organizations in supplying the lifeblood of the city and he was concerned--he had heard their relationships were not particularly good.... He felt he might be of some assistance to Con Ed...to act as some sort of referee."

In this oblique manner, the negotiations for a major payoff dragged on. But before any money could actually change hands, the whole scheme collapsed. An investor in a company that Marcus and Itkin had established complained to Manhattan district attorney Frank Hogan about the way his money was being handled. Hogan, and soon U. S. Attorney Morgenthau, began looking into the tangled affairs of Marcus and his friends, and the more they looked, the more they found. Suddenly it was time to cut and run, and every man ran for himself. Itkin rushed to his FBI contacts and belatedly spilled the story of the whole conspiracy (keeping the money that had been his share of the payoffs and turning in, as evidence, only the bank wrappers the money had come in). Trapped and facing a long prison sentence, Marcus suddenly resigned his job as water commissioner, to the shock and dismay of his patron, the mayor. He then took himself to Hogan and to Morgenthau, telling his side of the plot, agreeing to be a witness against his fellow conspirators in the hope of leniency.

Then the trials began. Marcus, Corallo, Motto and Fried were convicted for their roles in the reservoir payoffs. Because of his repentant and cooperative attitude, Marcus got off with 15 months in prison: Fried and Motto each got two years and Corallo, three. With Marcus and Itkin the chief witnesses, Corallo and DeSapio were convicted in the Con Ed conspiracy, with DeSapio going to jail for two years and Corallo for another four and a half on top of the earlier sentence. As for Itkin, though indicted, he was never brought to trial. His FBI benefactors protected him. But that protection took the form of residence under guard at a military base, for Itkin was convinced, he said, that should he wander the streets again, he would be a target for a bullet from one of Corallo's friends in the Mob.

• • •

To some, it must often have seemed that the Government's war against organized crime was not only directed solely against Italians but was being fought only in the streets and courtrooms of New York. Certainly, New York was the focus of a major drive and it was the struggle there against the principal crime families and their leaders--Gambino, Lucchese, Joseph Profaci, Joseph Bouanno and the rest--that got the biggest headlines. But there were plenty of mobsters elsewhere around the country who were not being ignored. Chicago boss Giancana realized this all too well.

Giancana had worked his way up from the bottom in the Capone manner and in the Chicago style--before he was 20, he had been arrested three times for murder and by the time he took command of the Chicago mob in 1957, his record listed 60 arrests. But as he matured in the ways of the Organization, Giancana learned to forgo muscle, cultivate the right people and put good friends in the right places. By the early Sixties, he had his son-in-law, Anthony Tisci, installed as the $900-a-month secretary to Chicago Congressman Roland Libonati, a member of the House Judiciary Committee who seemed to go out of his way to sponsor bills that helped Giancana and his friends avoid Government surveillance.

An even closer friend was Frank Sinatra. Giancana hoped that cultivating Sinatra's friendship would help him resolve some of his legal troubles. In the end, though, it helped Giancana not at all and did considerable damage to the singer. Sinatra had thrown all his energies into the Presidential campaign of John F. Kennedy in 1960 and hoped that with Kennedy's election he would be welcome at the White House; he further expected that his own estate in Palm Springs would become a vacation spot for the new President and even built an addition with this in mind. But Robert Kennedy killed Sinatra's hopes of forming a close relationship with the President. His Justice Department agents kept stumbling across Sinatra's name as they delved into the dealings of the Fischettis, New England mob boss Raymond Patriarca and others in the underworld hierarchy. Particularly disturbing were the reports of Sinatra's relationship with Giancana. In the early Sixties, Sinatra had acquired a controlling interest in the Cal-Neva Lodge, a luxurious hotel-casino on the California-Nevada border overlooking Lake Tahoe. Obviously, the singer wasn't going to run it himself. But the man he installed as manager was Paul D'Amato, a New Jersey mobster of long standing. According to the stories that reached Kennedy, D'Amato's real purpose at Cal-Neva was to take care of the Giancana interests; the Chicago leader had boasted that through Sinatra he owned a piece of the lodge.

If such reports were true, Sinatra was in deep trouble with the Nevada Gaming Board. Giancana was on the board's black list, one of 11 top mobsters barred from owning or even visiting a casino in the state on pain of the casino's losing its license. Then, in 1963, Giancana actually showed up at the lodge with his constant companion, Phyllis McGuire of the singing McGuire Sisters. Sinatra turned up about the same time and the two were seen in close company. The gaming board demanded an explanation. Sinatra said he hadn't invited Giancana to the lodge; and he promised that thenceforth he would avoid contacts with him in Nevada; but then he added that Sam "Mooney" was an old friend and it was his business if he wanted to see him outside the state. With all its past troubles over mobster control of casinos and skimming operations, the last thing the gaming board needed was a big casino owner who openly and blatantly paraded his friendship with a top gangster. The board initialed formal proceedings to strip Sinatra of his gambling license at Cal-Neva. Some powerful friends tried to come to Sinatra's aid. Governor Grant Sawyer was told how unfair it was to persecute the singer and how he might be the beneficiary of large campaign contributions. When this subtle approach failed, Sinatra voluntarily sold his interest in the lodge.

There was little doubt that Sinatra blamed many of his problems on Robert Kennedy. Through the succeeding years, his enmity toward the Kennedys and anyone associated with them increased (his once-close friend Peter Lawford, a Kennedy in-law, was even banished from the Sinatra circle). By 1968, all his energies were devoted to beating back Robert Kennedy's bid for the Democratic Presidential nomination. And after Kennedy's murder, Sinatra turned up with some new and lasting friends, Richard Nixon and Spiro Agnew--and the Palm Springs quarters that had been designed for John Kennedy became a second home to Agnew, the new Vice-President.

As for Giancana, it's possible that he began to have second thoughts about how valuable a friend Sinatra actually was. For he became a primary target for Kennedy's anticrime unit and the immunity law that had been passed at the Attorney General's urging was used to nail him. Not long after his 1963 visit to Cal-Neva, he was summoned before a grand jury, granted immunity and then grilled about the Mob and his role in it. Giancana decided that his best course was silence, which earned him a year in jail. When he was released, it was obvious that the Government's interest in him had not diminished. And it was obvious, too, that his much-publicized flings had earned him the displeasure of his Chicago associates. So he took himself off to Mexico, Argentina and other southern regions, leaving the rule in Chicago to the two old Capone mobsters, Accardo and Paul "The Waiter" Ricca, the same men he had displaced nearly a decade before.

• • •

If the mounting troubles of Italian mobsters worried the Gambinos, Accardos Grand Bahama Island at $2.80 an acre. The only proviso was that Groves agree to develop the area and dredge a deep-water port, which would become Free-port, at the mouth of Hawksbill Creek. The other was Canadian-born Louis A. Chesler, a close friend of Lansky's (they had cooperated in some shady Canadian mining schemes), a successful Florida real-estate promoter with a firm called General Development Company and a partner of Lansky ally John Pullman.

With Sands as their attorney (and with Lansky, as usual, playing Svengali), Groves and Chesler formed Bahamas Amusements, Ltd., and proceeded with plans to turn Grand Bahama Island into a tourist attraction, complete with the 250-room Lucayan Beach Hotel. It was not long before the real purpose of that hotel was apparent. There was a law in the Bahamas banning gambling; but there was another statute, enacted in 1939 at the urging of Sands, permitting himself, as the minister of finance and taxation, to grant certificates of exemption from the law. In 1963, the attorney for Bahamas Amusements negotiated just such a certificate of exemption for the Lucayan Beach Hotel; and as his legal fee for handling this negotiation with himself. Sands received $1,800,000.

So gambling went to Grand Bahama, with most of the equipment obtained from the closed illegal casinos in the United States. With the gambling went all the old familiar faces from Lansky-run casinos in the States and in Havana--Max Courtney, Charles Brudner, Dino Cellini and others. And with these old familiar faces went the high rollers, on Syndicate-organized junkets from every major city in the U. S. So successful was the Lucayan Beach that Groves began selling off some of the land he had bought at $2.80 an acre. The going price for some of it was as high as $2000 a front foot. Some of it even went to competitors, such as the King's Inn Casino. But there was plenty of room for another casino and, besides, King's Inn had been built by Daniel K. Ludwig, a billionaire recluse who had dredged the Freeport harbor for Groves and who just happened to lease the King's Inn to two of Lansky's old friends, Morris Lands-burgh, proprietor of Miami Beach's Eden Roc Hotel, and Sam Cohen (in 1971, both would be indicted with Lansky for Las Vegas skimming operations).

Still, Grand Bahama was only an out island. The real wealth lay in Nassau, tempting Lansky and other men of means. One was millionaire Huntington Hartford. Years before, he had bought Hog Island in Nassau Bay, renamed it Paradise Island and lobbied strenuously but unsuccessfully for a bridge to Nassau and a certificate of exemption. Suddenly, in 1965, minister Sands had a change of heart. Not toward Hartford but with regard to gambling on Paradise Island. He announced that he had been hired as attorney by a partnership of Mrs. Wallace Groves (most of Groves's holdings were in his wife's name) and a Tampa corporation called Mary Carter Paint Company (by then, promoter Chesler had been frozen out). In the name of that partnership, Sands applied to himself and easily obtained a certificate of exemption to permit Paradise Island gambling. At the same time, he announced the imminent construction of a toll bridge to the island. As for Hartford, he, too, was frozen out. though permitted to retain a minority interest in the island itself.

At first nothing seemed strange about the deal--at least no stranger than usual. Groves, after all, had made a success of the Grand Bahama operation. And Mary Carter now had a financial interest in the Bahamas, having bought 1300 acres on Grand Bahama and turned them into a subdivision. Besides, a major stockholder in Mary Carter was one Thomas E. Dewey, former racket buster, former governor of New York, former Republican candidate for President, now senior partner in a prestigious Wall Street law firm and close friend and advisor to another prominent Wall Street lawyer, Richard Nixon.

Before this new Bahamian venture got fully under way, however, the lid blew off. Reporters for The Wall Street Journal did some digging and what they uncovered won them a Pulitzer Prize. They turned up a seamy story of massive payoffs to the while rulers of the islands, from the prime minister on down, to gain gambling concessions. The ensuing outcry led to a general election, and black voters turned out in a massive wave. When the votes were counted, the Bahamas for the first time came under the rule of blacks, with the Progressive Liberal Party in control and a black prime minister named Lynden O. Pindling.

But Lansky and his friends had, in fact, hedged their bets on the Bay Street Boys. Support, some clandestine, some open, had also gone to Pindling-including the use of a helicopter for him to tour the islands courtesy of a Lansky associate, Mike McLaney. Lansky knew that if Pindling tried even partially to live up to his promises of bettering the lives of blacks, he would need the gamblers; they would be the most important source of revenue.

But first, as prime minister, Pindling felt the need to shatter his opposition, to totally discredit the former white rulers. This he did by setting up a Royal Commission of Inquiry. It revealed the whole story of payoffs and corruption, the venality of Sands, the dealings of Groves and Chesler, even the manipulations and control of Lansky. Some of the peripheral testimony, though, made even the commissioners a little uneasy. Courtney, for instance, talked at length about his prodigious bookmaking activities in the States. His customers, he said, included some of the country's most important men. Such as whom? he was asked. Such as onetime Vice-President Nixon, he answered. (The allegation has never been denied.)

Then Pindling moved to assure Lansky and the gambling fraternity that he was, at heart, their true friend. When Sands announced that Groves was withdrawing from the Paradise Island enterprise, Mary Carter was given the go-ahead. Within a year, it had not one but two casinos--the Nassau Bay Club and the rest, they didn't bother Meyer Lansky. As a Jew, he was, according to Hoover and the FBI, only an associate member of La Cosa Nostra and so of less importance. This mistaken assessment suited Lansky perfectly. All during the late Fifties and through much of the Sixties, as the heat on the Italians increased, Lansky was off building a bigger and more lucrative gambling empire.

At first, this empire appeared shaky. In late 1958, Fidel Castro and his 26th of July revolutionaries came down from their Sierra Maestra stronghold and by New Year's Day 1959 had taken control of Cuba. Batista had fled with millions looted from the Cuban treasury and close behind him were Lansky and his Syndicate partners. The few who remained, hoping that Castro would become another Batista, keeping the casinos going and taking a cut for himself, were first jailed and then unceremoniously thrown out of the country. Celebrating the end of the Batista regime, the Cubans went on an orgy of slot-machine smashing. The casino era in Havana was over.

And it was not long, either, before the illegal casino business in the United Stales was suffering under the onslaught of Kennedy's anticrime forces.

A farsighted man, Lansky had already planned for such exigencies. It was not far horn Cuba, or Miami, to the warm sands of the Bahamas. American tourists had been streaming there for years and, with the closing of the Cuban playground, the tourist boom would surely be staggering. So one day in 1960, Lansky got off a plane in Nassau and taxied to the offices of Sir Stafford Sands, the islands' 300-pound glass-eyed minister of finance and taxation and effective leader of the Bay Street Boys, the white power structure that ruled the Bahamas. Lansky had a proposition to make--one that would enrich Sands and guarantee a tourist invasion (and that might, if Sands and his fellow white politicians so desired, provide some employment and considerable economic benefits to the black majority, thereby keeping it docile). According to Sands, Lansky offered him $2,000,000 (others have put the offer at a mere $1,000,000), to be deposited for his personal use in one of those handy numbered Swiss accounts, if he would get legislation enacted to permit gambling.

Sands said he turned Lansky down, but the evidence indicates otherwise, for soon Lansky's ideas became reality with the help of Sands and two dubious characters. One was Wallace Groves, an American financial manipulator who had immigrated to the Bahamas after serving a prison term for mail fraud. He struck up a close friendship with Sands, who, in 1955, drew up and signed into law the Hawksbill Creek Act, which gave Groves vast tracts of land on and the Paradise Island Casino. Of course, the American underworld was no longer involved. Well, only to the extent that the manager of one of the clubs was Lansky's man Eddie Cellini (brother of Dino) and behind the tables were a lot of familiar faces from the Lansky circle. But that didn't deter the world's elite from jetting into Nassau to a gala celebration that opened gambling's new mecca in the Caribbean. And it didn't deter Wall Street attorney Nixon from taking time out from his incipient Presidential campaign to attend as an honored guest.

But then Mary Carter--or Resorts International, as it called itself after selling off its paint division--had an especial fondness for Nixon as well as for Nixon's closest friend, Charles "Bebe" Rebozo, the onetime Florida filling-station operator who made his first millions selling recapped tires during World War Two and then graduated to real estate, banking and other enterprises. During the 1968 Republican Convention in Miami Beach, the company offered Nixon free use of its yacht to rest and relax from the campaign rigors and bade him visit Paradise Island often after he reached the White House (the Secret Service said no to that, not when the casino catered to so many shady characters). And Nixon returned some of the favors. One of his Secret Service guards at the time of his Vice-Presidency, later the security director of the Nixon campaign headquarters in Miami Beach and later yet security director for the Inauguration, was James Golden. When his work for Nixon was done, he moved on to Resorts International, as deputy director of security.

As for Rebozo, when 900 shares of IBM stock turned up at his Key Biscayne Bank in 1968 as collateral for a loan--stock that turned out to have been stolen--one of the men Rebozo called to check on the stock and the loan was James Crosby, "the chairman of the board of Resorts International and an old friend of mine."

Through the Sixties, then, the money poured across the tables on Grand Bahama and Paradise Island. And Lansky's gambling empire expanded through much of the rest of the Caribbean, including Haiti, and even across the Atlantic to England. As fast as it flowed into the casinos' coffers, much of it flowed out again. For the venerable Lansky technique of the skim was working well and by then, Lansky and his associates had ready places for that cash to rest. A good part went into the Bank of Miami Beach and the Miami National Bank, which the Government would later charge served as major depositories for skimmed funds.

Who ran them? It was no secret anywhere that the Bank of Miami Beach was Lansky's bank in the U. S. The Miami National Bank was under the control of the Teamsters Central, Southwest and Southeast Pension Fund between 1959 and 1964. Then it passed into the hands of Lansky's close friend Cohen. But neither bank was the final resting place for the skim from Las Vegas or the Caribbean. From there it moved across the Atlantic, to the Mob-controlled Exchange and Investment Bank of Switzerland (among its officers, Lansky aides Ben Siegelbaum and Ed Levinson) and the International Credit Bank of Switzerland, which authorities called Lansky's private institution in the Alps, and one of whose officers, Sylvain Ferdman, had been identified as a Lansky courier.

From Switzerland, the money went to a thousand different places: back to the U. S. in the form of loans to and investments in legitimate businesses as the wedge for Syndicate take-over and into dozens of Syndicate operations. Later it was rumored that much of the money also wended its way into investments in Bernard Cornfeld's grandiose Investors Overseas Service, a rumor that perhaps grew out of Cornfeld's close friendship with Tibor Rosenbaum, head of the International Credit Bank. Together, they undertook a number of joint ventures--and among I.O.S.'s later major investments were large blocks of stock in Resorts International.

By the end of the Sixties, the tentacles of the Lansky octopus stretched in every direction, but its appearance was becoming deceptive. Lansky was growing old and he was beginning to attract some of the attention that traditionally had focused almost entirely on the Italian Mob. The world was changing and the face of organized crime was changing with it.

This is the 11th in a series of articles on organized crime in the United States.