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INVESTIGATION OF ORGANIZED CRIME
IN INTERSTATE COMMERCE
HEARINGS
BEFORE A
SPECIAL COMMITTEE TO INVESTIGATE
OEGANIZED CKIME IN INTEKSTATE COMMERCE
UNITED STATES SENATE
EIGHTY-FIEST CONGEESS
SECOND SESSION
PDRSDANT TO
S. Res. 202
A RESOLUTION AUTHORIZING AN INVESTIGATION
OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
PART 1
FLORIDA
MAY 26 AND 27, JULY 13, 14, AND 15, AUGUST S
AND 10, AND SEPTEMBER 19, 22, AND 26, 1950
Printed for the use of the Special Committee to Investigate
Organized Crime in Interstate Commerce
NVESTIGATION OF ORGANIZED CRIME
IN INTERSTATE COMMERCE
HEARINGS
BEFORE A
SPECIAL COMMITTEE TO INVESTIGATE
DEGANIZED CRIME W INTERSTATE COMMERCE
UNITED STATES SENATE
EIGHTY-FIRST CONGRESS
SECOND SESSION
PURSUANT TO
S. Res. 202
A RESOLUTION AUTHORIZING AN INYESTIGATION
OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
PART 1 , v\^'
.<V^
V
FLORIDA
MAY 26 AND 27, JULY 13, 14, AND IJ- AUGUST 9
AND 10, AND SEPTEMBER 19, 22, AND 26, 19o0
Printed for the use of the Si>ecial Committee to Investigate
Organized Crime in Interstate Commerce
UNITED STATES
GOVERNMENT PRINTING OFFICE
^gy^g WASHINGTON : 1950
,^v
Cofi
SPECIAL COMMITTEE TO INVESTIGATE ORGANIZED CRIME IN
INTERSTATE COMMERCE
ESTES KEPAUVER, Tennessee, Chairman
HERBERT R. O'CONOR, Maryland CHARLES W. TOBEY, New Hampshire
LESTER C. HUNT, Wyoming ALEXANDER WILEY, Wisconsin
RUDOLPH Halley, Chief Counsel
II
CONTENTS
Testimony of — Page
Allenberg, Abe, 3301 Collins Ave., Miami Beach, Fla___ 29, 89^125, 475-487
Burbridge, William, city councilman, Miami Beach, Fla 430-434
Burk, Thomas G., deputy sheriff, Dade County, Fla 194r-213
Clark, Walter, pherifl", Broward County, Fla., accompanied by C. L.
Chancey, attorney 126-134, 452-475
Cohen, Ben, attorney, Miami Beach, Fla 492-531
Costa r, Charles B., accountant, 903 First National Bank Building,
Miami, Fla., accompanied by William G. Ward, attorney, 1229
Dupont Building, Miami, Fla 30-41
Crosby, William O., investigator for the Governor of the State of
Florida, accompanied by Mr. Starrey, attorney, Tallahassee,
Fla 370-386
Eisen, Ben, accountant, 1308 Harrison Street, Hollywood, Fla 4-26
Eisen, Seymour, Hollywood, Fla 4-26
Ervin, Richard, attorney general, State of Forida, accompanied by
Messrs. Gasque, Toni, and Norton, of attorney general's staff 177-191
Fant, Julian E., treasurer, Warren Campaign for Goveimor 366-369
Pulenwider, Jack, former investigator for Crime Commission of
Greater Miami, Fl:. 280-282
Fulford, S. R., policeman, town of North Miami, Fla 272-278
Furman, M. G., accountant, Miami Beach, Fla 284-237, 434-445
Gips, Leon, Miami Beach, Fla 411-420, 423
Goldman, Abe A., public-relations agent, Miami, Fla 284^290
Griffin, C. V., Howey-in-the-Hills, Fla., accompanied by David Reich,
attorney. Washington, D. G 353-366, 596-599
Hall, David W., accountant, Miami. Fla 306-316, 328-330
Harkness. Alistair G.. Dade County, Fla 290
Hart, Ralph M.. accountant, 310 Citizens Building, West Palm Beach,
. Fla., accompanied by Mr. Chappell, attorney, Miami, Fla 43-65
Hawkins, J. L., chief criminal deputy, sheriff's office, Dade County,
Fla 278-280
Hibbs, Mrs. Hazel, 246 Northwest Thirty-first Street, Miami, Fla 26-29
Howden, R. W., investigator for Equitable Life Assurance Co., 1428
Northwest Thirty-second Street, Miami, Fla 191-194
Johnston, William H., Jacksonville, Fla., and Chicago, 111., accom-
panied by John W. Pehle and Laurence S. Lesser, attorneys, Wash-
ington. D. C 600-609,616-655
Levitt, Jules, Miami Beach, Fla.. accompanied by Ben Cohen, attornev,
Miami Beach, Fla '532^547
Levitt, Leo, Miami Beach, Fla.. accompanied by Ben Cohen, attorney,
Miami Beach, Fla 547-556
Milledge, Stanley, .ludge, circuit court of Dade County, Fla 144-152
Morris, Walter, assistant director of communications. National Air-
lines, 1947 Northwest Forty-eighth Street, Miami, Fla 140-144
Neu, Mrs. Gladys, Aberdeen, ^Md., accompanied by John L. Laskey,
attorney 1 , '718-730
Neu, Richard A., Aberdeen, Md., accompanied by John L. Laskey,
attorney ' '707-718
O'Rourke, John F., 521 Second Street, Miami, Fla 66-89, 445-452
Parker, Robert, 903 First National Bank Building, Miami. Fla., accom-
panied by Robert C. Ward, attorney, 1229 Dupont Building, Miami,
Fla 1-4
Perdue. Pat, vice squad, Miami Beach, Fla 420-430'
III
IV
CONTENTS
Testimony of — Continued ^^^^
Perkins, S. M., accountant, 340 Candia, Coral Gables, Fla_— 174-177, 282-283
Plissner, Harry, Miami Beach, Fla 332-337
Rice, Maj. Thomas A., and Mrs. Kuth M., Aberdeen, Md 703-707
Richard, Melvin J., city councilman, Miami Beach, Fla 213-230
Rosenbaum, Edward, 1040 Venetian Way, Miami, Fla., accompanied
by Ben Cohen, attorney, Miami Beach, Fla 55e-577, 591-596
Rush, John A., attorney, Jacksonville, Fla 387-407
Russell, Harry, Miami Beach, Fla 657-662, 664-687
Salvey, Harold, Miami Beach, Fla., accompanied by Ben Cohen,
attorney, Miami Beach, Fla 577-590
Schine, Meyer, Miami Beach, Fla., accompanied by Oscar L. Gruber,
attorney. New York, N. Y 346-353, 611-616
Short, Phil R., lieutenant of police, Miami Beach, Fla 407-411
Sullivan, Daniel P., operating director, Crime Commission of Greater
Miami, Fla 152-174
Sullivan, James A., sheriff, Dade County, Fla., accompanied by Richard
M. Hunt, attorney, Miami Beach, Fla 237-271, 283-284, 291-331
Ta.vlor, Harry G., attorney, 807 Dupont Building, Miami, Fla 230-232
Voikart, Ernest, Jr., assistant cashier, First National Bank, Aberdeen,
Md 689-696
Voikart, Ernest, Sr., attorney, Aberdeen and Baltimore, Md 696-703
Wolfson, Louis, Miami, E'la., and New York City ^__ 337-345
Schedule and summary of exhibits iv-ix
Friday, May 26, 1950 1
Saturday, Rlay 27, 1950 43
Thursday, July 13, 1950 135
Friday, July 14, 1950 233
Saturday, July 15, 1950 387
Wednesdav, August 9, 1950 491
Thursday, August 10, 1950 610
Tuesday, September 19, 1950 , 656
Friday, September 22, 1950 663
Tuesday, September 26, 1950 688
Appendix 731-798
Supplemental data 798-804
SCHEDULE OF EXHIBITS
Number and summary of exhibits
1. Greenacres Casino summary, 1949-50 ledger
2. Greenacres Casino payroll ledger, 1950
3. Club Eoheme payroll ledger, 1950
4. Club Boheme, 1948-49 and 1949-50 seasons' ledgers. _.
5. Greenacres Casino cash book, 1949-50
6. Club Boheme cash book, 1948-49 and 1949-50
7. Income-tax return of Club Boheme, 1948
8. Federal income-tax returns of Jake Lansky, 1936-48;
also, Louisiana and New York State returns
9. Income-tax returns of George Sadlo
10. Income-tax returns of S. L. Bratt
11. Income-tax returns of Vincent Alo
12. Income-tax returns of William and Ida Bischoff
13. Income-tax returns of Colonial Inn
14. Income-tax returns of Greenacres and William Bischoff,
trading as Greenacres Club, 1945 through 1949
15. Income-tax returns for Greenacres Club for 1944
through 1949
16. Partnership return, entitled "Frank Erickson, Bert
Briggs, and Colonial Inn"
' Returned to witness.
Introduced
Appears on
at page—
pa^e—
5
(0
5
(')
5
{')
5
(')
5
{')
5
(')
7
(0
7
(0
8
(')
8
(0
8
(•)
8
{')
8
(')
9
(0
16
(0
16
(0
CONTENTS
SCHEDULE OF EXHIBITS— Continued
Number and summary of exhibits
17. Tax returns reflecting ownership of Colonial Inn and
sale of this property to Greenacres
18. Statements of restaurant charges for Club Boheme to
customers, for February 1950
19. Unpaid bills of Club Boheme
20. Canceled checks of Club Boheme
21. Bank statements and canceled checks of Greenacres
Club
22. Six books of deposit slips for Greenacres and Club
Boheme
23. Some canceled checks and bank statements of Club
Boheme and payroll-tax account
24. Three check-books and two check-stub records of both
the Club Boheme and Greenacres __
25. Miscellaneous papers of Samuel L. Bratt, Club Green-
acres, "The Farm" and Club Boheme
26. Sales-tax reports to the State of Florida for Greenacres
Restaurant
27. Accounts receivable and paid, Club Boheme, 1948-49
season
28. Current check book of Club Boheme
29. Seven folders on payroll taxes
29A. "The Farm"
29B. Colonial Inn
29C. Greenacres and Bishop
29D. Greenacres
29E. George Scherman, et al
29F. Club Boheme
29G. Combination Greenacres and Bishop
30. Accident reports, Club Boheme
31A. Accident reports, Club Boheme
3 1 B. Accident reports, Club Boheme
32. Lease on Club Boheme
33. Contribution folder, Club Boheme and charities, etc
34. Realty leases for Colonial Inn
35. Show contracts for Club Boheme
36. Miscellaneous correspondence for Colonial Inn
37. Cabaret-tax folder for Colonial Inn
38. Minute book for Bouches' La Boheme, Inc
39. Miscellaneous papers
39A. Canceled checks, vouchers, and bank state-
ments
39B. Income-tax returns; work papers, etc., re-
lating to income-tax returns
39C. Fifteen checks, either payable to, or en-
dorsed by, or bearing notations with the
name "Alickey Cohen"
40. Income-tax file from 1942 to 1944 for Abe Allenberg..
Letters from Andy Pellino on the stationery of
Henry Pellino, CPA, New York City, discussing
AUen'berg's taxes in connection with those of
Fi-ank Erickson
41. Miscellaneous papers having reference to the Wofford
Hotel 1
42. Miscellaneous papers concerning Tropical Park and
Gables Racing Association
43. Photostat referring to partnership in Wofford Hotel,
dated September 21, 1945
' Returned to witness.
2 On file with committee.
Introduced
at i>age—
16
19
19
19
20
20
20
20
20
20
21
21
21
21
21
21
21
21
21
21
21
21
21
21
21
21
21
22
22
22
22
60
60
60
90
90
90
90
95
Appears on
pape—
VI
CONTENTS
f5CHEDULE OF EXHIBITS— Continued
Number and summary of exhibits
44. Photostat of dooument, dated December 28, 1945, re
formation of partnership between Allenberg, Car-
fano, and Lorentzen
45. Photostat of document dated April 20, 1945, giving
Carfano authority to sign checks
46. Assignment, dated May 23, 1946, submitted during
Allenberg's testimony
47. Group of checks signed by Allenberg
48. Photograph of Anthony Carfano, alias "Little Augie"
Pisano
49. Photograph of Frank Erickson
50. Photograph of Joe Adonis
51. Photograph of Meyer Lansky
52. Photograph of Vincent Alo, alias "Jimmie Blue Eyes"
53. Photograph of Michael Coppola, alias "Trigger Mike".-.
54. Photograph of Julius Kramer
55. Photograph of Benny Karpf, alias "Benny Kaye,"
alias "Ben Schwartz," alias "Ben Kahn"
56. Photograph of Frank Livorsi
57. Photograph of Alfred "Poagy" Toriello
58. Photograph of Frank Costello
59. Photograph of George Angersola
60. Photograph of John Angersola, alias "John King"
61. Photograph of Romeo Jos. Civetta
62. Photograph of Tony L. Cibetta
63. Photograph of Carlo F. Civetta
64. Photograph of Jo.seph Di Carlo
65. Photograph of Sam Di Carlo, alias "Toto"
66. Photograph of Sam "Gameboy" Miller
67. Photograph of Fred Angersola, alias "Fred King"
68. Photograph of Abraham "Longie" Zwillman
69. Photograph of Joseph Friedlander
70. Photograph of Nicholas Delmore, alias "Delmar"
71. Photograph of William Moretti, alias "Willie Moore,"
alias "William Maretti"
72. Photograph of Angelo "Gyp" DeCarlo, alias "Di Carlo,"
alias "Edward Meing"
73. Photograph of William Riga, alias "Silent Martin"
74. Photogra])h of Joseph Massei, alias "Joseph D.
Massey"
75. Photograph of William Gusto Bischoff, alias "Harry
Clark," alias "Lefty Clark"
76. Photograph of Louis Ricciardi, alias "Louie the Wop"_
77. Photograph of Joe Burnstein, alias "James Burnett"...
78. Photograph of Pete Licavoli, alias "Peter Moceri,"
alias "Peter Little" i
79. Photograph of Isadore Blumenfield, alias "Kid Cann".
80. Photograph of Martin F. Guilfoyle
81. Photograph of Charles Fischetti
82. Photograph of Murray "The Camel" Humphreys
83. Photograph of Martin Accardo
84. Photograph of Paul Viela, alias "Ricca"
85. Photograph of Max Pollock, alias "Caldwell"
86. Phot ograph of Ralph Buglio
87. Photograph of Willie Hccney
88. Photograph of Harry Rosen, alias "Nig Rosen," alias
"Herman Stromberg"
89. PhotoKraph of Samuel Hoffman, alias "Cappy Hoff-
man," alias "H. Field" __ 1 .
90. Photograph of David Glass
' Rotunicd to witness.
' On flic with committee.
Introduced
at page-
95
95
96
96
96
96
96
97
98
99
99
99
100
100
101
102
102
103
103
103
103
103
104
104
104
105
105
105
105
105
106
106
107
107
107
107
107
108
108
108
108
108
108
108
109
109
109
CONTENTS
SCHEDULE OF EXHIBITS— Continued
VII
Number and summary of exhibits
91. Photograph of Jack Silver, alias "Herman Gross,"
alias "May Rothman, alias "Frank Rosso"
92. Photograph of Max Segal, alias "Big Shooey"
93. Photograph of Frank Russo, alias "Tucker," alias
"Paul Carbo," alias "Jimmie the Wop"
94. Photograph of Abe Martin, alias "Abe Glassman"
95. Photograph of John Rosen, alias "PMwin Goldberg,"
alias "Irving Greenberg"
96. Photograph of Nathan Stromberg, alias "Nussie Rosen".
97. Photograph of Joseph Herman Kriss
98. Photograph of Tony Narcisi
99. Photograph of Frank Matteo, alias "Matto," alias
"Mattio," alias "Frankie Mendell"
100. Card showing Abe Allenberg as honorary deputy sheriff
101. Courtesy card to Abe Allenberg from Florida Sheriffs
Association
102. Letter to Miami Beach Kennel Club, June 15, 1944,
from Abe Allenberg
103. Letter from Jim Ponzio to Abe Allenberg, dated Sep-
tember 27, 1948
104. Letter from George Killion, treasurer. Democratic
National Committee, Washington, D. C, to Abe
Allenberg, dated May 6, 1947, enclosing receipt for
$2,500 contribution
105. Letter to Abe Allenberg, dated August 4, 1948, signed
"Ralph"
106. Grand-jury report, spring term, Dade County, Fla
107. Clipping from Miami Daily News, July 11, 1950, en-
titled "Covmty Delays Elisor Conference"
108. Chart furnished by Daniel P. Sullivan, showing major
gambling operations in Palm Beach and Dade County.
109. Chart furnished by Daniel P. Sullivan, acting director.
Crime Commission of Greater Miami, showing loca-
tion of major gambling operations in Broward County.
110. Chart furnished by Daniel P. Sullivan, listing guests
at WofTord, Grand, and Sands Hotels
111. Pictures and criminal records furnished by Daniel P.
Sullivan
112. Letter, dated July 19, 1949, from George F. Richard-
son, Philadelphia Police Department to Daniel P.
Sullivan, Crime Commission of Greater Miami,
setting forth history of gambling operations in
Philadelphia and Miami areas
113. Photostat of deed from deed book 2843, page 494,
showing transfer of property in Coral Gables held by
John Angersola (King) and Alfred Polizzi
114. Photostat of deed, dated July 29, 1946, showing
transfer of property to Arthur Me Bride and Alfred
Polizzi
115. Photograph of subdivision known as L^niversity Estates
of Coral Gables
116. General ledger relating to operations of Charles and
Sam Friedman; submitted by S. M. Perkins
117. Journal relating to Charlie's Inn, a night club operated
by Charles and Sam Friedman; submitted by S. M.
Perkins
118. Canceled checks, relating to operations of Charles and
Sam Friedman, from January 1936, through 1949;
submitted by S. M. Perkins
119. Bank statements for the year 1949, relating to the opera-
tions of Charles and Sam Friedman; submitted bv
S. M. Perkins \
Introduced
at page —
109
109
109
109
109
110
110
110
110
117
118
118
119
119
120
140
147
154
154
154
157
{')
(=)
{')
(')
{')
(.')
732
733
733
734
734
734
735-740
740
741
740
742
(')
160
743-745
161
746-747
161
748
161
{')
175
(»)
176
(')
176
(')
176
0)
1 Returned to witness.
2 On file with committee.
VIII
CONTENTS
SCHEDULE OF EXHIBITS— Continued
Number and summary of exhibits
Introduced
at page-
120. Letter from Melvin J. Richard to Robert Taylor,
county solicitor, dated June 15, 1950; submitted by
Melvin J. Richard
121. Photostat of 1947-48 license of S. & G. Investment Co.;
submitted bv Melvin J. Richard
122. Photostat of 1948-49 license of S. & G. Investment Co_ . _
123. Photostat of 1949-50 license of S. & G. Investment Co_ _ _
124. Photostat of card attached to 1947-48 license of S. & G.
Investment Co., signed "Leo Levitt by Ben Cohen,
attorney"
125. Records submitted by Harry G. Taylor, attorney, iden-
tified in memorandum submitted to Mr. Kiley, in-
vestigator
126. Tax returns, bank checks, bank statements, various
instruments of ownership of property, mortgages,
records of tax paid: Harold Salvey and S. & G.
Syndicate
127. Winter-term, grand-jury report, 1948, Dade Countv,
Fla :_-
128. Correspondence between sheriff Sullivan and Law En-
forcement League of Dade County; also letter from
Tom Watson, attorney general, State of Florida
129. Letter from Richard Hunt, attorney, to Sheriff Sullivan,
Opinion from the supreme court of the January
term, dated January 17, 1950
130. Statistics from Sheriff Sullivan's office, Dade County,
Fla., for years 1945 through 1949
131. Statistics from Sheriff Sullivan's office, Dade County,
Fla., for period from February 1, 1950, through March
15, 1950
132. Statistics from Sheriff Sullivan's office, Dade County,
Fla., for January 1950
133. Records of Sheriff Sullivan's predecessors in office, 1943
and 1944
134. Photograph of raid, showing racing wire set-up
135. Record of raids of Sheriff Sullivan's office, for 1950
136. Copy of bill for declaratory decree; also opinion and
order by circuit court
137. Photographs and criminal records, submitted by Sheriff
Sullivan
138. Home of John Angersola
139. Home of Sam Taran
140. Home of Ralph Buglio
141. Home of Martin Leo Accardo
142. Home of Charles Fischetti
143. Home of Tony Accardo
144. Letter from circuit court clerk, Sevier County, Tenn.,
to Sheriff Sullivan, regarding Jimmie Sakelaris
145. Record of Sheriff Sulhvan's office for the second quar-
ter, 1946
146. Set of books for Charlie's Inn, Miami Beach, Fla., sub-
mitted by S. M. Perkins
147. Income-tax reports, work sheets, and papers for 1936
through 1949 for Charles and Sam Friedman; sub-
mitted by S. M. Perkins
148. Bank statements and canceled checks, through June
1950, for Charlie's Inn
149. Paper wrapped in cellophane, submitted by Abe Gold-
man, noting telephone numbers
1 Returned to witness.
» On file with committee.
' Written into record.
220
224
224
224
224
232
234
244
244
247
247
248
249
249
252
253
253
262
263
263
263
264
264
264
264
269
270
283
283
283
288
CONTENTS
SCHEDULE OF EXHIBITS— Continued
IX
Number and summary of exhibits
Introducod
at page-
Appears on
page-
ISO.
151.
152.
153.
154.
155.
156.
157.
158.
159.
160.
161.
162.
163.
164.
165.
166.
167.
168.
169.
170.
171.
172.
173.
Letter from Gov. Fuller Warren to Sheriff Sullivan,
asking cooperation of sheriff's office with Mr. Crosby,
special investigator for the Governor of the State of
Florida
Photograph of Sheriff Sullivan's house at 1803 North-
west Sixth Street
Photograph of Sheriff Sullivan's house at 2321 South-
west Fourth Street
Photograph of Sheriff Sullivan's house at 2327 South-
west Fourth Street
Photograph of Sheriff Sullivan's house at 2370 South-
west Fourth Street
Photograph of Sheriff Sullivan's house at 2338 South-
west Fifth Street
Photograph of Sheriff Sullivan's house at 2620 South-
west Ninth Street
Pliotograph of Sheriff Sullivan's house at 2332 South-
west Fifth Street
Photograph of Sheriff Sullivan's house at 2236-2238
Southwest First Street
Photograph of Sheriff Sullivan's house at 2240-2242
Southwest First Street
Photograph of Sheriff Sullivan's house at 261 South-
west Thirtieth Road
Photograph of Sheriff Sullivan's house at 2485 South-
west Fourth Street
Income-tax returns of Sheriff Sullivan, from 1940
through 1949
Financial statements of Sheriff Sullivan, 1944 and 1950_
List of contributions collected by Abe Allenberg for
Warren Campaign for Governor
Work sheets, prepared by Harold G. Robinson, asso-
ciate counsel, showing contributions by S. & G.
Syndicate to police and firemen's organizations
Work sheets, prepared by Harold G. Robinson, asso-
ciate counsel, showing payments made by S. & G.
Syndicate for "regular" wire service
Work sheets, prepared bj^ Harold G. Robinson, asso-
ciate counsel, showing payments made by S. & G.
Syndicate for "special" wire service
Work sheets, prepared by Harold G. Robinson, asso-
ciate counsel, showing gross receipts for S. & G.
Syndicate
List of original stockholders in Orange Park Kennel
Club and Jacksonville Kennel Club; submitted by
William H. Johnston
First National Bank, Aberdeen, Md., deposit ticket,
dated Apr. 6, 1945, of Tredick Ford, payment on
mortgage, to the account of Mrs. — Mitchell, showing
deposit of $2,000
Ledger sheets, from First National Bank, Aberdeen,
Md., of Mrs. May H. Ford and Tredick Ford,
Aberdeen , Md
Photostats of agreement of sale and deed, covering 204
west Bel Air Avenue, Aberdeen, Md., signed by
Ethel G. Sullivan and James Sullivan
Photostats of three checks, signed by Thomas A. Rice,
payable to the order of Gladvs F. Neu, in amounts
of $5,000, $5,000, and $50, respectively
293
302
303
303
304
304
304
304
304
304
304
304
306
331
484
576
595
595
595
633
690
690
704
705
0)
782
782
783
783
784
784
785
785
786
786
787
0)
787-788
(')
788
789
790
790
791-792
(0
(')
793-795
796-797
* Returned to witness.
2 On file with committee.
X CONTENTS
SUPPLEMENTAL DATA
Page
Letter to Rudolph Halley, chief counsel, dated August 8, 1950, from Hon.
Fuller Warren, Governor of the State of Florida, enclosing clipping from
Fort Myer News-Press 798-801
Letter to Rudolph Halley, chief counsel, dated August 8, 1950, from Hon.
Fuller Warren, Governor of the State of Florida, enclosing ITebruary 18
statement by Governor Warren 801-802
Letter to Rudolph Halley, chief counsel, dated August 9, 1950, from Hon.
Fuller Warren, Governor of the State of Florida, enclosing August 7
order to sheriffs of Florida 802
Letter to Rudolph Halley, chief counsel, dated August 14, 1950, from Hon.
Fuller Warren, Governor of the State of Florida, enclosing February 21
statement by Governor Warren 802-803
Letter to Senator Kefauver, chairman, dated November 6, 1950, from Max
Marmorstein, Cleveland, Ohio 803-805
INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
FRIDAY, MAY 26, 1950
United States Senate,
Special Committee To Investigate
Organized Crime in Interstate Commerce,
Miami^ Fla.
The committee met in the courtroom of the United States district
court, Miami, Fla., on May 26, 1950, Senator Estes Kefauver, chair-
man, presiding.
Present : Senators Kefauver and Hunt.
Also present : Rudolph Halley, chief counsel.
The Chairman. The committee will come to order. For the record
this is the select committee of the United States Senate for the pur-
pose of investigating interstate criminal transactions, appointed by
the President of the Senate pursuant to Senate Resolution 202.
Mr. Halley. As a courtesy to an attorney, Mr. Robert C. Ward, who
represents Mr. Robert Parker, an employee of Charles B. Costar & Co.,
certified public accountants, let me state this for the record : A subpena
has been served on ]Mr. Parker, but he claims that he cannot produce
certain records in the absence of his employers. He is here with
counsel and, since the next witness is going to take a considerable
amount of time, I will ask the committee as a courtesy to listen to
him now.
The Chairman. All right.
TESTIMONY OF ROBERT PARKER, ACCOMPANIED BY ROBERT C.
WARD, ATTORNEY
Mr. Halley. Will you state your name and address for the record,
Mr. Parker?
Mr. Parker. Robert Parker, office address 903 First National Bank
Building, Miami, Fla. My home address is 2170 Northwest Fifty-
eighth Street, Miami, Fla.
JNIr. Halley. Mr. Ward, you are counsel for Mr. Parker?
Mr. Ward. Yes, sir.
Mr. Halley. What is your full name and address ?
Mr. Ward. Robert C. Ward, 1229 du Pont Building, Miami, Fla.
The Chairman. Do you solemnly swear that the testimony you will
give this committee will be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Parker. I do.
2 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Mr. Parker, you received a subpena to produce certain
records.
Mr. Parker. That is right.
Mr. Halley. And they are records of Charles B. Costar & Co., certi-
fied public accountants?
Mr. Parker. Well, I don't know whether we have all of those records
or not.
Mr. Halley. Are you an employee of Charles B. Costar & Co. ?
Mr. Parker. Yes.
Mr. Halley. What is your position ?
Mr. Parker. Well, I am more or less in charge in the absence of
Mr. Costar.
Mr. Halley. Are you in charge?
Mr. Parker. I am in charge of the procedure of the work, with
another man.
Mr. Halley. Who is the other gentleman?
Mr. Parker. Edward J. Diedriech.
Mr. Halley. Is he a partner of Mr. Costar ?
Mr. Parker. No.
Mr. Halley. Is he associated with him?
Mr. Parker. He is an employee, the same as I am.
Mr. Halley. In their absence you are in charge ?
Mr. Parker. That is right.
Mr. Halley. You received a subpena to bring certain records ?
Mr. Parker. That is right.
INIr. Halley. Have you looked to see if those records are on the
premises ?
Mr. Parker. No, sir ; like I say, I am in charge of the way the flow
of work goes on but I don't think I am in charge of the office to the
extent that I could take any of the records off or put any back other
than on a particular job.
Mr. Halley. You received the subpena?
Mr. Parker. Yes.
Mr. Halley. Is there anything you would like to say about it, Mr.
Ward?
Mr. Ward. In the absence of Mr. Costar, as Mr. Parker stated,
gentlemen, he is just an employee. Those records that you are after
we are willing to give to the committee but until such time as Mr.
Costar is back Mr. Parker, as he says, doesn't know where all of the
records are or if we have them all. Mr. Costar is on his way down here
from Washington at the present time, I believe.
Mr. Halley. When will he arrive?
Mr. Ward. His office doesn't know. He was in Johns Hopkins
getting a physical check-up and he said he would be in Miami some-
time this week end, and at that time we would be perfectly willing
to produce the records.
Mr. Halley. May I go off the record?
The Chairman. Yes.
(Discussion off record by permission of the chairman.)
The Chairman. What is Charles B. Costar & Co., a partnership or
corporation ?
Mr. Parker. It is a partnership. There is no such thing as a cor-
poration in the accounting business;, no more than there is in the law
business.
ORGANIZED CRIME IN INTERSTATE OOIVOIERCE 3
The Chairmax. Are you the highest one in command in the absence
of Mr. Cost ar?
Mr. Parker. No; Mr. Diedriech is.
The Chairman. Where is he ?
Mr. Parker. He is out of the office and has been out of the office all
day working.
The Chairman. Is the subpena addressed to Mr. Diedriech too?
Mr. Halley. Yes. but the office has been unable to produce him. Mr.
Parker has been in charge and is the only one in the office today.
The Chairman. You understand that it is not a matter of whether
Mr. Costar is willing for the records to be produced. We have sub-
penaed the records and if the records are there, we want them.
Mr. Parker. Let me put it this way : It is not a matter of routine
to me in the office if I do something I should not do. I have to work,
you know. I don't believe it is within the realm of my job to do that^
otherwise I would be willing to do so.
The Chairman. It is a subpena of the United States Senate that
has been served on you. We do not want to give you any trouble, but
this is a select committee of the Senate and we have a right to get
those records. You are the man in charge of the office upon whom
the subpena has been served, so it is not a question of whether Mr.
Costar wants you to do it. Unless we can be assured that the records
will be availal)le, I think we had better instruct Mr. Parker to have
them here at 9 o'clock in the morning, subject to a citation of contempt
b}^ tliis committee if he doesn't produce them.
Mr. Parker. Suppose I find that instead of an armful we have a
truckload of them, what assistance will I have in getting them over
here?
The Chairman. We will assist you in getting them over here.
Mr. Ward. Will it be agreeable to have Mr. Parker check the rec-
ords ? He doesn't know at the present time if the records or all of
them are over there.
Mr. Halley. The records are there. You are probably misin-
formed. He advised our investigator what records are there, and
we know what records are there.
Mr. Parker. That is wrong.
Mr. Halley. Mr. Parker so advised the man who served the sub-
pena on him. I think now that you are simply delaying matters. The
objection is not substantial at all.
The Chairman. When was this subpena served upon you ?
Mr. Parker. About 12 o'clock today.
The Chairman. Have you made any effort to find the records?
Mr. Parker. When they brought the subpena there I checked over
the names with the secretary and she checked off the names of the
ones which to her knowledge we never did any work for and that is
what I informed the investigator, the nature of the records we had
and which ones we had done no work for.
Mr. Halley. The inference being that you had done work for
others ?
Mr. Parker. Yes, but that does not necessarily mean that w^e have
any records.
Mr. Halley. We are simply wasting time. Go back and check to
see what you have and produce them pursuant to the committee's
instructions.
4 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Ward. At 9 o'clock?
The Chairman. If you get them together in that time without any
undue liardship.
Mr. Ward. We can inform you in a little while as to just what is
there.
The Chairman. Suppose you let us know as soon as you can. As
soon as Mr. Parker can find out just what he has got in the office, you
can inform us over here.
Mr. Parker. Let me explain one thing. When records get so old
they are transferred to storage. As to those in storage, I don't have
any idea what they would be. I don't think we can get them by 9
o'clock. If they are 5 or 6 years old they go in storage.
The Chairman. You can let us know what the situation is by 5 : 30
today ?
Mr. Parker. Yes; I can give you an idea of what we have in the
office.
The Chairman. We will expect to hear from you by 5 : 30 today.
Thank 3^011.
TESTIMONY OF BEN EISEN AND SEYMOUR EISEN
Mr. Halley. Wliat is your name and address^
Mr. EisEN. Ben Eisen, 1308 Harrison Street, Hollywood, Fla.
Mr. Halley. This gentleman is your brother?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. State your name and address for the record.
Mr. Seymour Eisen. jMy name is Seymour Eisen; my address is
Hollywood, Fla.
The Chairman. Do you and each of you solemnly swear that the
testimony you will give this committee will be the truth, the whole
truth, and nothing but the truth, so help you God?
Mr. Ben Eisen. I do,
Mr. Seymour Eisen. I do.
Mr. Halley. Mr. Eisen, are you an accountant ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. Do you have a certified public accountant's license in
the State of Florida ?
Mr. Ben Eisen. No, sir. I have no firm at all. I have been here
since 1934.
Mr, Halley. You operate as an individual ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. Are you a certified public accountant ?
Mr. Ben Eisen. No, sir.
Mr. Halley. Where is your office ?
Mr. Ben Eisen. I have no office.
Mr. Halley. Where do you work?
Mr. Ben Eisen. I worked at Gulfstream and the Hollywood Ken-
nel Club. Since 1945 or 1946 I have practically divorced myself from
much of the work at Greenacres, Boheine, and Colonial Inn and have
given most of my time to Hollywood Inn and Gulfstream.
JSIr. Halley. A subpeiui was served upon you today?
Mr Ben Eisen. Yes.
Mr. Halley. Pursuant to that subpena have you brought certain
records here?
ORGANIZED CR'IME IN INT-ERSTATE COMMERCE 5
Mr. Ben Eisen. Yes.
Mr. Halley. Would you care to produce those records and describe
tliem '^
Mr. Ben Eisen. I have quite a few records, sir.
Mr. Halley. What records have you brought?
The Chairman. Let's get them up here and see what we have got.
Mr. Ben Eisen. One of your men was up at the place and took
whatever he thought that he wanted. If there is anything else he
wants, he can come up and we will be glad to give him anything else
he wants.
Mr. Halley. Do you work with Mr. Ben Eisen?
Mr. Seymour Eisen. Not under his .supervision.
Mr. Halley. Do you work for the corporation ?
Mr. Seymour Eisen. I work independently.
Mr. Halley. In the same office?
Mr. Seymour Eisen. No. I have no office.
Mr. Halley. You also work at the Gulf stream Race Track?
Mr. Seymour Eisen. I work at the Gulfstream Race Track as pay-
roll clerk.
Mv. Halley. Where else do you work ?
Mr. Seymour Eisen. Club Boheme. I use the office of the Colonial.
Mr. Halley. Do you use the office of Club Boheme, too?
Mr. Seymour Eisen. No. It is not suitable.
Mr. Halley. Will you go ahead and describe the books?
Mr. Seymour Eisen. I have here the Greenacres Casino summary,
1949-50 ; Greenacres 1950 payroll, Club Boheme 1950 payroll, Boheme
Casino, 1948-49 and 1949-50 seasons; Greenacres cash book, 1949-50
and Club Boheme cash book for 1948-49 and 1949-50.
Mr. Halley. Mr. Chairman, I offer into evidence as exhibit Nos. 1
through 6, respectively, the books that have just been produced.
The Chairman. They will be accepted as exhibit Nos. 1 through 6
and will be made a part of the record.
(Greenacres Casino summary 1949-50, ledger, marked "Exhibit 1";
Greenacres payroll ledger, 1950, marked "Exhibit 2"; Club Boheme
payroll ledger, 1950, marked "Exhibit 3" ; Boheme Casino 1948-49 and
1949-50 seasons, ledger, marked "Exhibit 4"; Greenacres cash book,
1949-50, marked "Exhibit 5"; and Club Boheme cash book, 1948-49
and 1949-50, marked "Exhibit 6." Exhibits later returned to witness
after analysis by committee.)
Mr. Halley. Will you describe the nature of the business of the
Club Boheme?
The Chairman. Are these boys brothers ?
Mr. Ben Eisen. Yes,. The Club Boheme is a restaurant and night
club.
Mr. Halley. Does it have any gambling operations ?
Mr. Ben Eisen. Yes.
Mr. Halley. Will you describe the gambling operations there ?
Mr. Ben Eisen. Well, I don't know how to begin. Can you ask
specific questions ?
Mr. Halley. Yes. Is there a crap game at the Club Boheme ?
Mr. Ben Eisen. Yes.
Mr. Halley. Roulette wheels up there ?
Mr. Ben Eisen. Yes.
6 ORG'ANIZE'D CRIME IN INTEESTATE COOVEMER'CE
Mr. Hallet. Are there various card games and games of chance
operating there ?
Mr. Ben Eisen. Yes.
Mr. Halley. What are the games of chance operated by Club
Boheme ?
Mr. Ben Eisen. That's all.
Mr. Halley. Is tliere any horse-race betting at the Club Boheme ?
Mr. Ben Eisen. No, sir.
Mr. Halley. The gambling takes place in rooms other than the,
restaurant ; is that correct ?
Mr. Ben Eisen. Yes.
Mr. Halley. In the restaurant there is music ?
Mr. Ben Eisen. Yes.
Mr. Halley. And entertainment?
Mr. Ben Eisen. Yes, sir.
]VIr. Halley. In the form of a night club show ; is that right ?
Mr. Ben Eisen. Yes, sir,
Mr. Halley. Is the Club Boheme open to the public ?
Mr. Ben Eisen. Yes.
Mr. Halley. Anyone can go to the Club Boheme and have dinner
and see the show ; is that correct ?
Mr. Ben Eisen. Yes.
Mr. Halley. And then can gain entrance to the other rooms in
which they can gamble ?
Mr. Ben Eisen. I don't know what the procedure is. I never was
there to observe it.
Mr. Halley. You have been there ?
Mr. Ben Eisen. Yes.
Mr. Halley. The people could freely walk in and out of the gam-
bling rooms ?
Mr. Ben Eisen. Yes.
]Mr. Halley. Where is the Club Boheme located ?
Mr. Ben Eisen. It is located on Koute AlA, Hallandale, Fla.
Mr. Halley. Do you have records indicating the ownership of the
Club Boheme?
Mr. Ben Eisen. Not in my possession. There are tax returns which
would indicate that.
Mr. Halley. Who prepared the tax returns?
Mr. Ben Eisen. Well, the tax returns were prepared by — I sum-
marized the figures and the tax returns were prepared by George
Goldstein, a New Jersey accountant.
Mr. Halley. Do you know Goldstein Bros. ?
Mr. Ben Eisen. No, sir. They are in Newark, N. J.
Mr. Halley. Is that Goldstein & Goldstein?
Mr. Ben Eisen. I don't know.
Mr. Halley. Do you have any records indicating the ownership of
the Club Boheme?
Mr. Ben Eisen. Not here.
Mr. Halley. Do you have them in your ofRce or your home or at
the Club Boheme?
Mr. Ben Eisen. I reiterate that the ownership, as far as I know^
is what is on the tax returns themselves. There are no others.
Ml'. Halley. Have you ever seen the tax returns?
Mr. Ben Eisen. Yes.
ORGANIZED CRIME IN INTE'RSTAT'E COMMERCIE 7
Mr. Halley. Do you recall the ownership as shown on the tax
returns ?
Mr. Ben Eisen. No, sir.
Mr. Halley. Where are the tax returns ?
Mr. Seymour Eisen. I have them here.
Mr. Halley. Can you produce them now ?
Mr. Seymour Eisen. Yes.
Mr. Ben Eisen. He don't know whether you mean the property
itself or what. You see, sir, the property is owned by somebody else.
Mr. Halley. You have just handed me a document which appears
to be a copy of a partnership return of income for 1948 for the Club
Boheme. I offer this into evidence.
The Chairman. It will be received and made a part of the record
as exhibit No. 7.
(Copy of income-tax return of Club Boheme, 1948, marked "Exhibit
No. 7," later returned to witness after analysis by committee.)
Mr. Halley. Where did you get the information for this tax
return ?
Mr. Ben Eisen. The information was derived from the books and
records of the Club Boheme.
Mr. Halley. In your possession ?
Mr. Ben Eisen. No, sir ; at the Club Boheme.
Mr. Halley. Are they now at the Club Boheme?
Mr. Ben Eisen. They are right here.
Mr. Halley. This return shows certain names which I will recite
for the record: Frank Shireman, Samuel L. Bratt, Claude Litteral,
Meyer Lansky, Jack Lansky, and George Sadlo, which shows a total
distribution there of $205,470.77. Can you explain the manner in
which the distributive share of each of these persons was arrived at?
Mr. Ben Eisen. Well, I could figure it out in a minute for you if
you will give me a little time. I thought the percentages would be on
here but I don't see them.
Mr. Halley. Do you have any other records indicating the per-
centage ownership of each of these individuals ?
Mr. Ben Eisen. It should be in here.
Mr. Halley. What other tax returns do you have here ?
Mr. Ben Eisen. What tax returns do I have to give to you and what
do you want ?
Mr. Halley. We want all that you have.
Mr. Ben Eisen. Shall I go back a distance?
Mr. Halley. Yes. Go ahead and tell the committee what you have.
Mr. Ben Eisen. Well, I have Mr. Lansky's tax returns that go all
the way back as far as I can remember. Here they are.
Mr. Halley. Thev are in a folder marked "Jack Lansky, Federal
returns, 1936 to 1948"?
Mr. Ben Eisen. 1949 is in there, too.
Mr. Halley. I offer this entire folder in evidence as exhibit No. 8.
The Chairman. It will be received in evidence as exhibit No. 8
and made a part of the record.
Mr. Halley. What other tax returns do you have?
Mr. Ben Eisen. Can I ask you something off the record ?
Mr. Halley. It will go on eventually even if you go off the record.
We cannot make any commitments.
68958 — 50 — pt. 1 2
8 lORG'ANIZE'D CRIME IN INTERSTATE COMMERCE
Mr. Ben Eisen. I am not asking for anything. All I want to know
is to make sure that we will have these tax returns again so that I
will be in a position to get the information for the next returns.
The Chairman. That is assured.
(Folder previously produced and admitted in evidence as exhibit
No. 8 contains Jack Lansky Federal returns, 1936 to 1949, also Louisi-
ana and New York returns, and was later returned to witness after
analysis by committee.)
Mr. Halley. The next exhibit offered is a folder of income-tax
returns marked "George Sacllo," which folder is offered in evidence
as exhibit No. 9.
The Chairman. It will be received in evidence as exhibit No. 9 and
made a part of the record.
(Folder containing income-tax returns of George Sadlo marked
"Exhibit No. 9." Later returned to witness after analysis by com-
mittee. )
Mr, Halley. The next folder is marked "Income-tax returns of S. L.
Bratt," which is offered into evidence as exhibit No. 10.
The Chairivian. It will be received in evidence and made a part of
the record as exhibit No. 10.
(Said folder of income-tax returns of S. L. Bratt marked "Exhibit
No. 10." Later returned to witness.)
Mr. Halley. The next folder is marked "Income-tax returns of
Vincent Alo," which is offered in evidence as exhibit No. 11.
The Chairman. It will be received in evidence and made a part of
the record as exhibit No. 11.
(Said folder of income-tax returns of Vincent Alo marked "Exhibit
No. 11." Later returned to witness.)
Mr. Halley. The next is a folder containing tax returns of William
and Ida Bischoff, which is offered in evidence as exhibit No. 12.
The Chairman. It will be received as exhibit No. 12 and made a part
of the record.
(Said folder containing tax returns of William and Ida Bischoff
marked "Exhibit No. 12." Later returned to witness.)
Mr. Halley. The next folder is a folder containing income-tax
returns of Colonial Inn, which is offered in evidence as exhibit No. 13.
The Chairman. It will be received in evidence and made a part of
the record as exhibit No. 13.
(Said folder containing income-tax returns of Colonial Inn marked
"Exhibit No. 13." Later returned to witness.)
Mr. Halley. Mr. Ben Eisen, will you state what the Colonial
Inn is?
Mr. Ben Eisen. The Colonial Inn is Minsky's Burlesque now.
Mr. Halley. Is it a place which is now used as a burlesque house ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. What was it formerly ?
Mr. Ben Eisen. Niglit club and casino.
Mr. Halley. Gambling casino?
Mr. Ben Eisen. Yes.
Mr. Halley. When did it cease to be a gambling casino and be-
come a burlesque liouse?
Mr. Ben Eisen. I believe the return you have there in your hand is
the last one.
ORGANIZED CRIME IN INTE'RSTAT'E COMMERCE 9
Mr. Halley. By the return I hold in my hand you refer to the 1948
return ?
Mr. Bex Eisex. Yes, sir.
Mr. Halley. Were the operations of the Colonial Inn transferred
to some other place?
Mr. Bex Eisex. To the Club Boheme. The same shareholders run
the Club Boheme — not all the same but a majority of them. You can
check the names on the 1948 return with those on the return of the
Club Boheme, and you can probably see the name as shown.
Mr. Halley. What is the Greenacres Club ?
Mr. Bex Eisex. Restaurant and casino.
Mr. HxVLLEY. Is Greenacres the same as the Colonial Inn ?
Mr. Bex Eisex. No, sir.
Mr. Halley. Is Greenacres still operating as a gambling casino
and restaurant ?
Mr. Bex Eisex. It is closed now.
Mr. Halley. Was it operating during the past winter ?
Mr. Bex Eisex. Yes, sir.
Mr. Halley. Will you state whether or not you have here the in-
come tax returns for Greenacres?
Mr. Bex Eisex. Yes [produces returns]. The schedules are inside.
Mr. Halley. You have handed me a folder of income tax returns
for the Greenacres and William H. Bischolf, known as Greenacres
Club. Are these all of the income tax returns for the Greenacres
Club?
Mr. Bex Eisex. Yes.
Mr. Halley. I otfer them in evidence as exhibit Xo. 14.
The Chairmax. The folder will be received in evidence and made
a part of the record as exhibit No. 14.
(Folder containing income tax returns of Greenacres and William
H. Bischoff, trading as Greenacres Club, 1945 through 1949, marked
"Exhibit No. 14." Later returned to witness.)
yiv. Halley. Greenacres Club is located where ?
Mr. Bex Eisex. In Broward County. I don't believe it is in any
town. It is county "property."''
Mr. Halley. Broward County is the county immediately adjacent
to the county in which Miami is located; is that right?
Mr. Bex Eisex. That is right.
Mr. Halley. Greenacres Club is a place which serves meals ?
Mr. Bex Eisex. That is right.
Mr. Halley. Does it also have entertainment ?
Mr. Bex Eisex. No entertainment.
Mr. Halley. Does it have gambling, card games, roulette, and so
forth ?
Mr. Bex Eisex. Yes.
Mr. Halley. And what other games of chance, would you say ?
Mr. Bkx Eisex. They had a wheel there.
Mr. Halley. Roulette wheel ?
Mr. Bfx Eisex. Not roulette. What do you call it ? It is called
the Big Six wheel — that is what they call it.
Mr. Halley. Does it have card games ?
Mr Bex Eisex. I believe it has.
10 lORG'ANIZE'D CRIME IN INTERSTATE COMMERCE
Mr. Halley. Do you have the 1949 return for Greenacres? I see
the last one here is 1948.
Mr. Ben Eisen. No ; that year is not over yet. ^
Mr. Halley. You are on a fiscal year ending October 31, 1949?
Mr. Ben Eisex. Right.
Mr. Halley. This return shows the following as the owners of
Greenacres Club : Greenacres 60 percent and W. H. Bischoff 40 per-
cent. Is there a breakdown of the parties in interest of Greenacres ?
Mr. Ben Eisen. I believe in this particular return the 60 percent of
Greenacres is transferred over to Boheme and picked up in that return
with all of the other partners. Do you want to check that now ?
Mr. Halley. Yes ; we will do that now.
Mr. Ben Eisen. Where is that return you just had ?
Senator Hunt, It is on the bottom there. It is exhibit 8.
Mr. Ben Eisen. It is picked up in the — the 60 percent was picked
up over here. It was picked up in this income-tax return and you will
probably see it when you check the record.
Mr. Halley. Do you have the return for William H. Bischoff ?
Mr, Ben Eisen, Yes, I just gave you the folder. Here it is — the
Greenacres, the one that you just had in your hand. You see it right
here, "income from partnership of Greenacres, $133,233.88."
Mr. Halley. Will you look at the return for the Club Boheme ? Do
you have that there ?
Mr. Ben Eisen. You have it.
Senator Hunt. It is Exhibit No. 8.
Mr. Halley. I will now turn to the return for Colonial Inn. I note
that among the owners of Colonial Inn in your previous year, 1947-48,
there appeared F. Erickson, but he does not appear among the owners
of the Club Boheme on the tax return. Do you know whether or
not Frank Erickson had any beneficial interest in the Club Boheme?
Mr. Ben Eisen. None that I know of.
Mr. Halley. I notice that B. Briggs has 5 percent of Colonial Inn.
Does B. Briggs have any beneficial interest in Club Boheme?
Mr. Ben Eisen. Not that I know of.
Mr. Halley. I notice that Joe Doto had 15 percent of the Colonial
Inn. Do you know Joe Doto by another name?
Mr. Ben Eisen. Yes.
Mr. Halley. By wliat other name ?
Mr. Ben Eisen. Joe Adonis.
Mr. Halley. Does ,iop A donis by that name or any other name have
any interest in the Club Boheme ?
Mr. Ben Eisen. No.
Mr, Halley, When the Colonial Inn was converted from a gambling
casino to a burlesque house, were the accounts closed formally ?
Mr. Ben Eisen. I believe they were.
Mr, Halley, Did you handle that transaction?
Mr, Ben Eisen. No,
Mr. Halley. Who did?
Mr. Ben Eisen. ISIr, Lansky,
Mr, Halley, What accountant made up the account?
Mr, Ben Eisen. We didn't have any.
Mr. Halley. No accountants?
Mr. Ben Eisen. No.
ORGANIZED CRIME IN INTERSTATE COMIVIERCE 11
Mr. Halley. Are you referring to Jack Lansky ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. Who gave Jack Lansky the figures with which to close
the accounts for Colonial Inn ?
Mr. Ben Eisen. He took the figures from the final report.
Mr. Halley. You mean that you used the income-tax report as the
final report ?
Mr. Ben Eisen. Right.
Mr. Halley. Was there a more full report given to the participants
than the income-tax report?
Mr. Ben Eisen. No.
IVIr. Halley. Do you have possession of the canceled checks for the
Colonial Inn ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. Do you have the final distribution that was made to
the partners of Colonial Inn ?
Mr. Ben Eisen. No, sir.
Mr. Halley. Where are the books that were used for that final dis-
tribution ?
Mr. Ben Eisen. I don't believe that they were paid by checks.
Mr. Halley. How were they paid ?
Mr. Ben Eisen. In cash, I believe.
Mr. Halley. How much cash was involved?
Mr. Ben Eisen. I don't know. I w asn't at the closing, sir.
Mr. Halley. You are an accountant. You certainly must be able
to guess how much cash the Colonial Inn had at the end of business.
Mr. Ben Eisen. The records will show that.
Mr. Halley. Will you look at the records and tell me?
Mr. Ben Eisen. I don't have the records here.
Mr. Seymour Eisen. We brought the current stuff down first. Any-
thing else we will produce,, if you need it.
Mr. Halley. Can you produce the record of the Colonial Inn ?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. Will you produce that tomorrow morning at 9 o'clock ?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. Are you familiar with the records ?
Mr. Seymour Eisen. Yes.
Mr. Halley. Do you know how much cash was available for distri-
bution at the time the Colonial Inn closed ?
Mr. Seymour Eisen. No, sir.
Mr. Ben Eisen. The records will show exactly what cash there was
at the end of the period, because it is recorded in the records. Let me
have one of those things there. It is copied right in here and also
the money in the bank is there, so that woulcl be the cash at the
end of the period.
Mr. Halley. Where did you get your figures for the daily receipts
of the Colonial Inn ?
Mr. Ben Eisen. From the cash book.
Mr. Halley. Who kept the cash book ?
Mr. Ben Eisen. Seymour.
Mr. Halley. Where did Seymour get the figures with which to keep
the cash book ?
12 ORGANIZED CKIIVIE IN INTERSTATE C'OMIMERCE
Mr. Seymour Eisen. The cash book is a daily or monthly summary,
however you want it, of the business transactions. It shows the dis-
position of moneys put in the bank and pay-outs for expenses.
Mr. Halley. Were you in charge of the bookkeeping operations of
the Colonial Inn ?
Mr. Seymour Eisex. Yes, sir.
Mr. Halley. From day to day?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. Are you in charge of the day-to-day bookkeeping oper-
ations at the Club Boheme?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. At the end of the day do you personally count the cash ?
Mr. Seymour Eisen. No, sir.
Mr. Halley. Who gives you the figures each day of cash receipts and
cash disbursements?
Mr. Seymour Eisen. The cash receipts in the restaurant are counted
by me and are deposited in the bank by me. The cash distributions are
recorded and checks are made periodically.
Mr. Halley. Let's turn to the gambling casino. Who counts the
cash receipts there?
Mr. Seymour Eisen- I had nothing to do with that.
Mr. Halley. Do the books reflect the profits of the gambling casino ?
Mr. Seymour Eisen. Yes; there is a record kept of the gambling
casino income.
Mr. Halley. Daily ?
Mr, Seymour Eisen. Daily.
Mr. Halley. Do you keep that record ?
Mr. Seymour Eisen. No.
Mr. Halley. Who kept it ?
Mr. Seymour Eisen. Mr, Lansky.
Mr. Halley. Personally?
Mr, Seymour Eisen, He submitted it to me at the end of the season
and I analyzed it.
Mr. Halley. "VYliat do you mean by analyzed it ?
Mr. Seymour Eisen. I can show you better than I can explain it.
Mr, Halley, Will you do that?
Mr. Seymour Eisen, I will turn to the Boheme Casino, to the date
January 3, 1950, This is the sheet that was handed to me at the end
of the year and I summarized it and analyzed it. Now in this book
here let's look for the date January 3, and it shows : "win $1,385 ; loss,
$128 ; cigars, etc., $21.65." Now, sir, that is the extent of that day.
Mr. Halley, Does that puiport to be a page covering that daj^'s
operations ?
Mr. Seymour Eisen, Yes.
Mr. Halley. You don't receive these pages each daj' ; is that correct?
Mr. Seymour Eisen, No, sir,
Mr. Halley. Who handed vou these pages at the end of the season,
the 1950 season ?
Mr. Seymour Eisen. I don't remember what individual handed
them to me ; I just got them and summarized them,
Mr, Halley. You got them all in a batch ?
Mr. Seymour Eisen. Yes, sir.
Mr, Halley. Willyou search your memory and state to this com-
mittee who handed you the batch of papers in this exhibit entitled
ORG'AISriZED CE'IME IN ENPT'ERSTAT'E COMMEROE 13
"Cash Receipts and Disbursements'" for the Club Boheme gambling
operations ?
Mr. Seymour Eisen. No one handed it to me. The only way it
happens is this : I would go into the casino room at the cashier's table
and that is where it was and I just took them.
Mr. Halley. Some time ago you said that Mr. Lansky himself kept
that record; is that correct?
Mr. Seymour Eisen. As far as I know^; yes.
Mr. Halley. Is that his handwriting?
Mr. Seymour Eisen. I don't know.
Mr. Halley. We are looking at page dated 1-3-50, which presum-
ably means January 3, 1950. In the upper right-hand column there
is shown a balance of $175,886.83. Do you recognize that hand-
writing at all?
Mr. Seymour Eisen. No, sir.
Mr. Halley. Did you ever see anybody making these sheets out?
Mr. Seymour Eisen. No, sir.
Mr. Halley. Who told you these sheets existed?
Mr. Seymour Eisen. Mr. Lansky had the records.
Mr. Halley. Which Mr. Lansky?
Mr. Seymour Eisen. Jack Lansky I am referring to, sir.
Mr. Halley. What records does he have ?
Mr. Seymour Eisen. He is in charge of all records, and I did the
work for him as bookkeeper.
Mr. Halley. At the end of each night's operations is the cash
counted ?
Mr. Seymour Eisen. May I explain something here. There are
two divisions to this, the restaurant and the casino. I handled the
restaurant.
Mr. Halley. You count the cash each night at the restaurant?
Mr. Seyiniour Eisen. Yes; and I make the deposits.
Mr. Halley. You don't count the cash at the casino ?
Mr. Seymour Eisen. I have nothing to do with that until the end
of the year, when I put it in this book.
Mr. Halley. Who counts the cash at the casino ?
Mr. Seyjniour Eisen. I don't know,
]Mr. Halley. You are there every night ?
Mr. Seymour Eisen. I am there part of the night and during the
day.
Mr. Halley. You were there at the end of the night's operations
in the dining room ?
Mr. Seymour Eisen. Yes.
Mr. Halley. Who is in charge of the casino ?
Mr. Seymour Eisen. Mr. Lansky.
Mr. Halley. Jack Lansky ?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. Is he there every night, substantially every night?
INIr. Seymour Eisen. Yes.
Mr. Halley. Do the books reflect the people employed in the casino ?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. What books reflect it ?
Mr. Seymour Eisen. The payroll books.
Mr. Halley. What exhibit is that ?
l4 ORG'AXIZED CRIME IN INTERSTATE C'OIVEMERCE
Mr. Seymour Eisen. I submitted them to you.
Mr. Halley. They are in evidence?
Mr. Seyimoue Eisen. Yes, sir.
Mr. Ben Eisen. Can I help j^ou out a little ?
Mr. Halley. Yes.
Mr. Ben Eisen. I just want to explain something here. If my
brother had to stay there every night and watch them count the money,
he would be there until 5 or 6 o'clock in the morning, because these
places don't close until very late, and the entire gambling casino is
in charge of Mr. Lansky, in main control there, and he prepares his
own summary that will be reflected in the books. At the end of the
night I can probably tell you myself that after they close each table
the take the money and put it in the cashier's cage and they count it
down.
Mr. Halley. Who counts it?
Mr. Ben Eisen. Mr. Lansky.
Mr. Halley. Personally?
Mr. Ben Eisen. Yes ; or Mr. Sacllo, or whoever is there with him.
Mr. Halley. One of the partners supervises it?
Mr. Ben Eisen. Yes. One of the partners counts it and another
partner checks it with him. In the casino they have a cashier at the
cashier's cage where all of the "take" is taken, and those figures in all
probability are the cashier's figures, and you can find out who he is
by looking in the payroll book which reflects the cashier's crap men
and everybody.
Mr. Halley. It is your opinion that this handwriting here is the
handwriting of the cashier ?
Mr. Ben Eisen. That is right. It is not Jack Lansky's handwriting.
Mr. Halley. You are familiar with the handwriting of Jack
Lansky ?
Mr. Ben Eisen. Yes.
Mr. Halley. Do you know the cashier's name?
Mr. Ben Eisen. George Brown and Joseph Kirby.
Mr. Halley. That is something that can be furnished later and at
some length ?
Mr. Ben Eisen. All right.
Mr. Halley. Who runs the Greenacres' operations?
Mr. Ben Eisen. Samuel L. Bratt.
Mr. Halley. Is Edward G. Bischoff connected with Greenacres?
Mr. Ben Eisen. Edward ? It is William.
Mr. Halley. You have it William H. Bischoff here.
Mr. Ben Eisen. That is right.
Mr. Halley. Is he connected Avith Greenacres' operations?
Mr. Ben Eisen. Yes.
Mr, Halley. Who runs the big crap game at the Greenacres ?
Mr. Ben Eisen. William H. Bischoff and Greenacres have a 60-40
partnership.
Mr. Halley. Who actually operates it, supervises the operations?
Mr. Ben Eisen. Mr. Bischoff.
Mr. Halley. Do you know a Mr. Joe Massei ?
Mr. Ben Eisen. No.
Mr. Halley. Did you ever hear of the name?
Mr. Ben Eisen. In the papers ; yes.
ORGANIZED CRIME IX IN'TERSTATE COREVIERCE 15
Mr. Halley. Have you ever seen anybody by the name of Joe
Massei ?
Mr. Ben Eisen. Never saw liim.
Mr, Hallet. Have you ever seen Joe Massei, Seymour?
Mr. Seymour Eisen. No.
Mr. Hali.ey. Have you ever heard of any connection with Green-
aci'es or the Colonial Inn, either direct or indirect, by Joe Massei or
have you seen any records indicating such participation?
:Mr. Bex Eisen. No.
IMr. Halley. "What other records do you have here ?
Mr. Ben Eisen. These are the same thing — Greenacres. You will
note that this Greenacres is operated in two sections; one is the
restaurant and the other is the casino. One is the 60-40 ownership,
this part over here, and I just pointed out to you the restaurant end,
and this other one here is the gambling end.
]\Ir. Halley. It is in the gambling that you have the 60-40 per-
centage : is that right ?
Mr. Ben Eisen. Let me illustrate.
Mr. Halley. Go ahead.
Mr. Ben Eisen, The Bischoff-Greenacres has the main game ; that
is tlie big game, as they call it. Now the wheel and the Bix Six are
run by the restaurant, and the restaurant takes that and puts it in its
income along with the income from the food, drinks, and so forth.
Mr. Halley. In other words, the tax returns in exhibit No. 14 reflect
the income from the big game ?
Mr. Ben Eisen. That is right.
Mr. Halley. Do I understand correctly that the tax return that is
filed each year for Greenacres and Bischoff is a tax return on one
crap game ?
Mr, Ben Eisen. That is right.
Mr. Halley, Known colloquially as the big crap game ?
Mr, Ben Eisen, Yes, sir.
Mr. Halley. Which is run hj Bischoif ?
Mr. Ben Eisen, Yes, sir.
Mr. Halley, Isn't it a fact that Joe Massei has been interested in
the big game, too ?
Mr. Ben Eisen. Yes.
Mr. Halley. Don't they call it the New York crap game, too ?
Mr, Ben Etsen. Yes.
Mr. Halley. There is other gambling at the Greenacres ?
Mr. Ben Eisen, Yes,
Mr, Halley, Is there another table where the stakes are smaller?
Mr. Ben Eisen, Yes,
Mr. Halley. Koulette wheels?
Mr, Ben Eisen, Yes,
Mr. Halley. A separate return is filed for the other gambling op-
erations ?
Mr. Ben Eisen. Only for the wheel and the restaurant, which is
together.
Mr. Halley. How about the smaller crap game ?
Mr. Ben Eisen. That is taken into the big crap game, which han-
dles the "craps."
Mr. Halley. All of the crap games are reflected in the returns of
the Greenacres-Bischoff combination, exhibit No. 14 ?
Mr. Ben Eisen, That is right.
16 ORGANIZED CRIME IN INTERSTATE COIMMERCE
Mr. Halley. Now, you have produced here another batch of re-
turns in a folder entitled "Greenacres Regular," which I will offer
in evidence as exhibit No. 15.
The Chairman. It will be received and made a part of the record
as exhibit No. 15.
(Said folder containing income-tax returns of Greenacres Club, for
1944 through 1949, marked "Exhibit No. 15," returned to witness.)
Mr. Halley. Will you describe the income that is indicated in these
return constituting exhibit No. 15 ?
Mr. Ben Eisen. I am giving you everything I have got, so you
can have a little file about it. If it is not on top, then it is inside.
This one here is for 1944. It should be in another folder here.
Mr. Halley. Let's find it now. Let's make sure they are all in one
folder, in one exhibit.
Mr. Seymour Eisen. There is none for 1949-50 yet.
Mr. Halley. How about 1948-49?
Mr. Seymour Eisen. Here it is.
Mr. Halley. You have handed me one ending October 31, 1949.
Mr. Ben Eisen. It must be in here somewhere ; maybe it is mixed
up in here somewhere here before 1949. See? This is the Bischoff
one and this is the Greenacres. Is that right ?
Mr. Halley. I don't know. You tell me.
Mr. Ben Eisen. Yes, this is for Greenacres. Now you have them
up to 1949.
Mr. Halley. So we have exhibit Nos. 14 and 15 properly identified?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. Exhibit No. 16, which is offered in evidence, is a part-
nership return of income tax from January 17, 1946, to April 3, 1946,
entitled "Frank Erickson, Bert Briggs, and Colonial Inn."
The Chairman. It will be received in evidence and made a part
of the record as exhibit No. 16. (Later returned to witness.)
Mr. Halley. Let it be known that the business or profession is
noted on the record as booking, too.
The Chairman. It will be so noted.
Mr. Ben Eisen. This money here is shown as income to the Colonial
Inn, and then it is picked up in
Mr. Halley. In other words, the income shown in exhibit No. 16
is picked up in another return ?
Mr. Ben Eisen. That is right.
Mr. Halley. This holder is what ?
Mr. Ben Eisen. This shows the ownership of the Colonial realty,
the property.
Mr. Halley. And in this folder is the return showing the property
income ?
Ml". Ben Eisen. Yes; and the sale of the property to Greenacres.
Mr. Halley. I offer it in evidence.
The Chairman. It will be received in evidence and made a part of
the record as exhibit No. 17.
(Said folder identified as above marked "Exhibit No. 17." Later
returned to witness.)
Mr. Halley. As a convenience to you these folders will be kept
together.
Mr. Ben Etsen. Thank you.
ORGANIZED CRIME IN ENTE'RSTATE COMMERCE 17
Mr. Halley. I would now like to go back to the cessation of the
operations at Colonial Inn and the start of the operations at Club
Bolieme. The Colonial Inn operated through 1948 ; is that right ?
Mr. Ben Eisen. Yes, sir.
Mr. Halley. And the very next year Club Boheme started ; is that
right?
Mr. Ben Eisen. Yes.
Mr. Halley. According to your records and your testimony Frank
Erickson and Bert Briggs no longer participate in the operations ; is
that correct?
Mr. Ben Eisen. In the Boheme?
Mr. Halley. Yes.
Mr. Ben Eisen. That is right.
Mr. Halley. Can you explain the circumstances under which they
dropped out of that operation ?
Mr. Ben Eisen. I don't know.
Mr. Halley. Have you ever done any accounting for Frank Erick-
son?
Mr. Ben Eisen. No.
Mr. Halley. Have you ever done any personal accounting for
Frank Erickson?
Mr. Ben Eisen. Never.
Mr. Halley. Do you do any personal accounting for Bert Briggs ?
Mr. Ben Eisen. No.
Mr. Halley. Have you ever ?
Mr. Ben Eisen. No, sir; aside from giving them a statement at
times of their booking, when he brought me the figures I made up a
statement of the accounts and it reflected the profits, of which Colonial
Inn received one-half, and I believe later on Boheme had an interest
with him.
Mr. Halley, Do you have any correspondence that you have brought
with you with Erickson or Briggs ?
Mr. Ben Eisen. No. I didn't keep any correspondence with them.
The only thing I did was to answer a letter their accountant sent me,
which I received around January sometime, and he was in an awful
rush to get an idea of the share that Briggs or Erickson had, and I
wrote him a letter and told him exactly what the figures showed, and
told him that the tax returns would follow as soon as they were
drawn up.
Mr. Halley. Do you have a copy of the letter to which you refer?
Mr. Ben Eisen. No. I don't keep them.
Mr. Halley. You don't keep copies of letters ?
Mr. Ben Eisen. No. I don't write many.
Mr. Halley. What is that accountant's name ?
Mr. Ben Eisen. Andy Pellino.
Mr. Halley. "\Yliat is his address ?
Mr. Ben Eisen. I believe it is Fifth Avenue, New York City.
Mr. Halley. Do you recall in the year 1948 writing a letter to
Andy Pellino about the income of Briggs and Erickson?
Mr. Ben Eisen. Yes.
Mr. Halley. And that was 2 years ago ?
Mr. Ben Eisen. I believe it was.
Mr. Halley. Wliy does that letter stand out in your memory ?
18 ORGANIZED CRIME IN INTERSTATE CO]VIMERCE
Mr. Ben Eisen. It could only be a schedule of what their share of
the profits were from the Colonial Inn, if it was 1948, and also their
share of the profits from the books, so that they could enter it on their
returns. .
Mr. Halley. What other letters did you write Andy Pellmo? Did
you write him from time to time or just once?
Mr. Ben Eisen. I don't believe I ever wrote more than two letters
to him.
Mr. Halley. In each case stating income ?
Mr. Ben Eisen. Yes ; always income. They would ask me what it
was and I would just answer his letter and sign it.
Mr. Halley. You know Andy Pellino pretty well ?
Mr. Ben Eisen. I have known him a long time but I never had any
business with him except these two letters.
Mr. Halley. What books did you refer to ?
Mr. Ben Eisen. They had a book in the Hollywood Beach Hotel.
Mr. Halley. What kind of a book ?
Mr. Ben Eisen. Horse book.
Mr. Halley. "Who ran it ?
Mr. Ben Eisen. Bert Briggs.
Mr. Halley. ^Vlio owned it?
Mr. Ben Eisen. Bert Briggs, I suppose ; it was in his place.
Mr. Halley. Did Frank Erickson have an interest in it?
Mr. Ben Eisen. Yes.
Mr, Halley. In what years did they have these books ?
Mr. Ben Eisen. The books ran all through the Boheme or the Colo-
nial Inn, we will say, because the income was picked up in both returns.
Mr. Halley. You also know that Frank Erickson alone or with
others has a gambling concession at the Boca Raton ?
Mr. Ben Eisen. I don't know.
Mr. Halley. Isn't it also a fact that Frank Erickson, without or
with associates or partners, has a gambling concession or interest at
the Roney-Plaza Hotel?
Mr. Ben Eisen. I don't know.
Mr. Halley. Do you know whether or not Frank Erickson has
employees or agents accepting bets at the race tracks in and around
Miami ?
Mr. Ben Eisen. I don't know.
Mr. Halley. Did you ever discuss with Erickson the reason why
Erickson and Briggs did not participate in the Club Boheme?
These questions are addressed also to your brother, Seymour Eisen.
Do you know the answers to any of those questions ?
Mr. Seymour Eisen. No, sir.
Mr. Halley. Did Jack or Mever Lansky ever discuss with you, Sey-
mour, the reasons why Frank Erickson don't participate in the Club
Boheme?
Mr. Seymour Eisen. No ; they never talked or discussed that with
me at all.
(Recess.)
Mr. Halley. Was there a horse book at Colonial Inn ?
Mr. Ben Eisen. No, sir.
Mr. Halley. Or at Greenacres?
Mr. Ben Eisen. No.
ORGANIZED CRIME IN INTERSTAT'E COMMERCE 19
Mr. Halley. Or Club Bolieme ?
Mr. Ben Eisen. No, sir.
Mr. Halley. Are your answers to the questions the same ?
Mr. Seymour Eisen. Yes, sir.
Mr. Halley. Was there ever a horse wire in any of those chibs?
Mr. Ben Eisen. No, sir.
Mr. Seymour Eisen. I never saw none.
Mr. Halley. Did they have a ticker service at any of these places ?
Mr. Ben Eisen. None of those places.
Mr. Halley. Did you ever hear of a place called the Farm Casino ?
Mr. Ben Eisen. Where ?
Mr. Halley. F-a-r-m Casino, in Broward County.
Mr. Ben Eisen. That is the farm. There hasn't been any gambling
there in years.
Mr. Halley. Was there once gambling at the farm ?
Mr. Ben Eisen. Yes. They were enjoined a long time ago; long
before the Colonial Inn.
Mr. Halley. Who owns the farm ?
Mr. Ben Eisen. The farm was owned by Jack Lansky.
Mr. Halley. Did Frank Erickson have a part of it?
Mr. Ben Eisen. No, sir.
Mr. Halley. I would like to turn to the rest of the reports and
get them into evidence.
Exhibit No. 18 is a folder containing statements of restaurant
charges for Club Boheme to customers for February 1950.
(Folder of statements of restaurant charges for Club Boheme to
customers for February 1950 received in evidence as exhibit No. 18.
Later returned to witness.)
Mr. Halley. Next is a folder containing unpaid bills of Club
Boheme.
(Folder of unpaid bills for Club Boheme received in evidence,
marked "Exhibit No. 19." Later returned to witness.)
INIr. Sey^iour Eisen. Here is a miscellaneous checking account.
Mr. Halley. We want to get all of your vouchers and checks to-
gether. You have a box of vouchers.
Mr. Seymour Eisen. This is the Greenacres checking account.
There are others which I haven't got here.
Mr. Halley. As exhibit No. 20, I offer a box containing canceled
checks of Club Boheme.
( Checks Nos. 1 through 1822 on First National Bank of Hollywood,
Fla., received in evidence as exhibit No. 20. Later returned to wit-
ness.)
Mr. Halley. Mr. Eisen, will you state whether exhibit No. 20 con-
tains all of the canceled vouchers and bank statements of Club
Boheme in your possession?
Mr. Seymour Eisex. I don't know what is here, sir. I would have
to look to see what is in here.
Mr. Halley. Would you rather I put it this way : Do you know of
any that you have that are not in this box ?
Mr. Seymor Eisen. There are other records around, but I don't
know which records. I will bring them up, as we told JNIr. Rice, any-
time he M'ants it.
Mr. Ben Eisen. We were in such a hurry to get down here. We ^r*
together whatever was there and brought it down.
20 ORGANIZED CKIME IN INTERSTATE COMAIERCE
Mr. Halley. If Mr. Rice visits the office, where are they located ?
Mr, Seymour Eisen. Right now everything is at the farm in Hal-
landale.
Mr. Halley. If Mr. Rice visits the farm during sometime next
week, will you coo])erate and give him .any other records he needs?
Mr. Ben Elsen. Yes, sir.
Mr. Seymour Eisen. All the records that he wants ; all the records
I have.
Mr. Halley. Do you have any canceled checks for the Greenacres?
Mr. Seymour Eisen. There is a box of them.
Mr. Halley. Here is a box of canceled checks and bank statements
for Greenacres, which I offer in evidence as exhibit No. 21.
The Chairman. It will be received and made a part of the record.
(Box of bank statements and canceled checks of Greenacres
Restaurant received in evidence as exhibit No. 21. Later returned to
witness.)
Mr. Seymour Eisen. I have a group of duplicating deposit slips for
Greenacres and Club Boheme. That is what it amounts to.
Mr. Halley. How many books of deposit slips are there?
Mr. Seymour Eisen. Six.
Mr. Halley. I offer the entire six as one exhibit, exhibit No. 22.
The Chairman. Let it be received and made a part of the record.
(Six books of deposit slips for Greenacres and Club Boheme received
in evidence as exliibit No. 22. Later returned to witness.)
Mr. Halley. A batch of some canceled checks and bank statements
of the Club Boheme and payroll-tax account are offered in evidence as
exhibit No. 23.
The Chairman. It is received and made a part of the record.
(Canceled checks and bank statement of Club Boheme and payroll-
tax account received in evidence as exhibit No. 23. Later returned to
witness.)
Mr. Seymour Eisen. Here are three checkbooks and two check-stub
records of both the Club Boheme and Greenacres.
Mr. Halley. I offer them all in evidence as exhibit No. 24.
The Chairman. It will be made a part of the record.
(Three checkbooks and two check-stub records of Club Boheme and
Greenacres received in evidence as exhibit No. 24. Later returned to
witness. )
Mr. Halley. A folder of miscellaneous papers, correspondence, etc.
Mr. Ben Eisen. That was just laying on the talde.
Mr. Halley. It is offered in evidence as exhibit No. 25.
The Chairman. It will be received and made a part of the record.
(Folder of miscellaneous papers of Samuel L. Bratt, Club Green-
acres, the farm. Club Boheme, received in evidence as exhibit No. 25.
Later returned to witness. )
Mr. Seymoltr Eisen. Here are some Greenacres paid and unpaid
bills that go with that.
Mr. Halley, What do you have next?
Mr. Seymour Eisen. Sales-tax reports, State of Florida,
Mr. Halley. For what? Greenacres Restaurant?
Mr. Seymour Eisen. Yes.
Mr. Halley. I offer it in evidence as exhibit No. 2G.
The Chairman. It will be received and made a part of the record.
ORGANIZED CRIME IN INTE'RSTAT'E COMMERCE 21
(Sales-tax reports, State of Florida, Greenacres Restaurant,
received in evidence as exhibit No. 26. Later returned to witness.)
Mr. Halley. We will add to exhibit No. 24 one other check-stub
book.
The Chairman. It is so ordered.
Mr. Seymour Eisen. Other accounts receivable.
Mr. Halley. Accounts receivable and paid for Club Boheme?
Mr. Seymoltr Eisen. Yes, Club Boheme, 1948-49 season.
Mr. Halley. Offered in evidence as exhibit No. 27.
The Chairman. It will be received and made a part of the record.
(Accounts receivable and paid. Club Boheme, 1948-49 season, re-
ceived in evidence as exhibit No. 27. Later returned to witness.)
Mr. Halley. The current checkbook of Club Boheme is offered
in evidence as a separate exhibit, No. 28.
The Chairman. It will be received and made a part of the record.
(Current checkbook for Club Boheme received in evidence as exhibit
No. 28. Later returned to witness.)
Mr. Halley. A batch of seven folders on payroll taxes is offered as
exhibit No. 29, identified as follows: 29-A, the farm; 29-B, Colonial
Inn; 29-C, Greenacres and Bishop; 29-D, Greenacres; 29-E, George
Scherman et al. ; 29-F Club Boheme; 29-G, combination Greenacres
and Bishop.
The Chairman. Let them be received and made a part of the record.
(Seven folders on payroll taxes, marked "Exhibit Nos. 29-A
through 29-G, inclusive, received in evidence. Later returned to
witness. )
Mr. Seymour Eisen. Sales-tax reports, cabaret-tax reports, and
bank statements. Club Boheme.
Mr. Halley. The folders so described are offered as exhibit No. 30.
The Chairman. It will be made a part of the record.
(Sales-tax reports, cabaret-tax reports, and bank statements, Club
Boheme, received in evidence as exhibit No. 30. Later returned to
witness.)
Mr. Halley. Two folders as previously described by the witness as
accident reports, offered as exhibit Nos. 31-A and 31-B.
The Chairman. Let them be received and made a part of the record.
(Accident reports. Club Boheme, received in evidence as exhibit
Nos. 31-A and 31-B. Later returned to witness.)
Mr. Halley. The lease on Club Boheme is offered as exhibit No. 32.
The Chairman. It will be received and made a part of the record.
(Lease on Club Boheme received in evidence as exhibit No. 32.
Later returned to witness.)
Mr. Halley. Contribution folder, Club Boheme, and charities, etc.,
is offered as exhibit No. 33.
The Chairman. It will be received and made a part of the record.
(Contribution folder. Club Boheme, and charities received in evi-
dence as exhibit No. 33. Later returned to witness.)
Mr. Halley. A folder of realty leases for the Colonial Inn, offered
as exhibit No. 34.
The Chairman. Let it be received and made a part of the record.
(Folder of realty leases for Colonial Inn received in evidence as
exhibit No. 34. Later returned to witness.)
Mr. Halley. A folder entitled "Show Contracts"' for the Club Bo-
heme is offered in evidence as exhibit No. 35.
22 ORGAXIZED CRIME IN INTERSTATE COMMERCE
The CiiAiRMAx. Let it be received and made part of tlie record.
(Folder entitled "Show Contracts" received in evidence as exhibit
No. 35. Later returned to witness.) i ^ , • i
Mr. Halley. Miscellaneous correspondence folder for the Colonial
Inn is offered as exhibit No. 36.
The Chairman. Let it be received and made a part of the record.
(Miscellaneous correspondence folder for Colonial Inn received in
evidence as exhibit No. 36. Later returned to witness.)
Mr. Halley. Cabaret-tax folder for the Colonial Inn is offered as
exhibit No. 37.)
The Chairman. Let it be received and made a part ot the record.
(Cabaret-tax folder for Colonial Inn received in evidence as ex-
hibit No. 37. Later returned to witness.)
Mr. Halley. Minute book for Bouche's La Boheme, Inc., is offered
exhibit No. 38.
The Chairman. It will be received and made a part of the record.
(Minute book for Bouche's La Boheme Inc., received in evidence as
exhibit No. 38. Later returned to witness.)
Mr. Halley. Wliat is Bouche's La Boheme?
Mr. Seymour Eisen. It is now the property of Club Boheme.
Mr. Halley. Just what is it? Wliat is this. corporation; do you
know?
Mr. Seyiniour Eisen. I do not.
Mr. Halley. Is it a building?
Mr. Seymour Eisen. I don't know. I had nothing ever to do with
it. These are the reports we inherited in cleaning up.
Mr. Halley. One folder of miscellaneous papers offered in evidence
as exhibit No. 39.
The Chairman. Let it be received and made a part of the record.
(Exhibit No. 39 contains the following: Stock certificates for
Bouche's La Boheme, Inc., and book of blank stock certificates; agree-
ment dated January 9, 1947, between Richard Melvin of Miami and
Hy Ginnis of Chicago, pertaining to Club Boheme; inventory of Club
Boheme and various legal documents re Club Boheme, the Hampshire
Corp., Hy Ginnis, Albert Bouche, Edna Bouche, and Noel Montfiori ;
bank statement and canceled checks re Greenacres, Club Boheme tax
account and Club Boheme cabaret account. Later returned to wit-
ness.)
The Chairman. Let the record show that the committee will work
in cooperation with you, and that Seymour Eisen says anything he
can do he will do, and that the representatives of the committee may
see any bills or any current reports that they need to see.
Mr.' Halley. Mr. Ben Eisen, returning to the exhibit which is the
cash receipts and disbursements on the gambling at Colonial Inn — is
this La Bolieme — Club Boheme — I think you identified the hand-
writing on the individual sheets and I think we were talking about a
sheet dated January 3, 1950, so I will turn to that again. Is that the
signature of the cashier?
Mr. Ben Eisen. That is riglit.
Mr. Halley. Do you remember the name of the cashier?
Mr. Ben Eisen. I will give you the cashier's name. His name is
Joe Kirby.
Mr. Halley. Will you spell that?
Mr. Ben Eisen. K-i-r-b-y. And George Brown.
ORGANIZED CRIME IN ESTTERSTTAT'E COMMERCE 23
Mr. Halley. Wliicli one's is that handwriting?
Mr. Bex Eisen. I don't know ; either one. Tliey have ahnost the
same handwriting. If yon look tlirongh here, they are pretty close.
I don't know. This might be George Brown and that might be Joe
Kirby.
Mr. Halley. Where are they?
Mr. Ben Eisex. They are here. One is here.
Mr. Halley. Which one is here ?
Mr. Ben Eisen. Kirby is here.
Mr. Halley. Where is he ?
Mr. Ben Eisen. Living in Hollywood.
Mr. Halley. Do you know his address?
Mr. Ben Eisen. No; I don't know his address, but I think the
records will show it.
Mr. Halley. Where is Brown?
Mr. Ben Eisen. Brown just finished working at the art gallery
and he went up to New York. They are up on a buying trip. He will
probably be back soon.
Mr. Halley. I don't want to seem to pry, but it seems to me there
might be a few more papers in this brief case.
Mr. Ben Eisen. They are mine, unless you want those blanks.
Mr. Halley. Not relating to these clients?
Mr. Ben Eisen. You can look at them if you like.
Mr. Halley. No ; you are testifying under oath.
Mr. Chairman, I respectfully suggest that the witness be excused for
the present and that the subpena be adjourned sine die subject to
recall by the committee at such time as the committee sees fit.
The Chairman. That will be clone, but before we do that, perhaps
Senator Hunt may have a few questions he wishes to ask.
Senator Hunt. No ; I haven't any.
The Chairman. I have one or two that I would like to ask.
You referred to Bobo, I believe, as Joe Adonis. Was that you that
did that ?
Mr. Ben Eisen. Yes, sir.
The Chairman. Do you know Joe Adonis?
Mr. Ben Eisen. Yes, sir.
The Chairman. How come he was called "Bobo"?
Mr. Ben Eisen. I believe "Joe Doto," sir, was his right name.
The Chairman. Joe Doto ?
Mr. Ben Eisen. His nickname is "Adonis," as far as I know.
The Chairman. Is he carried on all of these books as Joe Doto
rather than Joe Adonis ?
Mr. Ben Eisen. That is right.
The Chairman. Does the record show what interest Joe Doto or
Joe Adonis has now in Club Boheme or any of these clubs that we have
been talking about ?
Mr. Ben Eisen. Yes, sir; the record shows it.
Mr. Halley. When did you last see Joe Adonis or Joe Doto?
Mr. Ben Eisen. I don't think I saw him this year at all. I saw him
last year.
The Chairman. Are any other people carried on here by any other
than the names by which we know them? Frank Costello, for in-
stance— does he have some other name?
Mr. Ben Eisen. No.
68958— 50— pt. 1 — —3
24 ORGANIZED CRIME IN rNTT-ERSTATE COMMERCE
Tlie Chairman. Or Frank Erickson ?
Mr. Ben Eisen. No.
The Chairman. There is one point I didn't understand and that
was your statement that when a dividend was made at the end of the
season, when the various interests were paid off, you didn't have any
record to show me how much they were paid ; is that correct ?
Mr. Ben Eisen. No; I just said that the — I wasn't there when any
dividends were paid.
The Chairman. You said they were paid in cash ?
Mr. Ben Eisen. That is right.
The Chairman. Who did the paying?
Mr. Ben Eisen. Mr. Lansky.
The Chairman. Do you know why they were paid in cash rather
than by check?
Mr. Ben Eisen. No, sir.
The Chairman. Don't you have any idea?
Mr. Ben Eisen. It seems to have been the custom.
The Chairman. Tliere was a
Mr. Ben Eisen. They paid that way all the time. I never ques-
tioned why they didn't pay in checks or why they paid in cash.
The Chairman. The money was kept in a bank, wasn't it?
Mr. Ben Eisen. Yes, sir.
The Chairman. Who would draw the money out of the bank?
Mr. Ben Eisen. Mr. Lansky.
The Chairman. And they got the cash ?
Mr. Ben Eisen. Yes, sir. It could also have been left in the bank-
roll ; the bankroll cash that they used daily.
The Chairman. Did they have a safety-deposit box ?
Mr. Ben Eisen. Yes, sir.
The Chairman. Where was that box ?
Mr. Ben Eisen. At the Club Boheme.
The Chairman. How about in one of the banks?
Mr. Ben Eisen. I don't know.
The Chairman. Do you know, Seymour?
Mr. Seymour Eisen. No, sir.
The Chairman. Were you ever there, Ben, when a dividend was
paid in cash ?
Mr. Ben Eisen. No, sir.
The Chairman. Were you, Seymour?
Mr. Seymour Eisen. No, sir.
The Chairman. Do you know why it was paid in cash rather than
being paid by check?
Mr. Seymoitr Eisen. I don't know, sir.
Mr. Ben Eisen. We have never been out there — I have never been
and I know Seymour hasn't been — whenever they closed.
The Chairman. Why would anyone pay in cash rather than by
check? The money was kept in the bank, wasn't it, deposited in the
bank?
Mr. Ben Eisen. No, sir.
The Chairman. Tlioy had no bank deposits?
Ml'. Ben Eisen. Yes, but all the money wasn't deposited. The
bankroll was always kept in cash at the casino. The only deposit
they made would be for- — if somebody y)aid them by check and they
deposited that money in the bank, then draw it out and they would
ORGANIZED CRIME IN INTERSTATE COMMERCE 25
Still have that in the bankroll all the time. When the restaurant
needed any money, they would draw a check from the casino and
deposit it in the restaurant account.
The CFrAiioiAx. What percentage of the money taken in in the
joint o])eration would you say was deposited in the bank?
Mr. Ben Eksen. That is hard to figure, sir.
The Chairman. What is your best guess ; about ?
Mr. Ben Eisen. It seems to me like the amount of money in the
bank was never very much, because the restaurant was always short of
money. The restaurant actually lost money every time they operated.
Seymour could ])robably give you a little more information.
The CiiAiK.ArAN. What is your information, Seymour'^
J\Ir. Seymour Eisen. All the money of the restaurant is deposited
in tlie bank daily. The money from the casino I don't know about.
The Chairman. The record shows here that on some days the
Casino won a net of more than $1,000. Would that money all be kept
together until the end of the season?
Mr. Seymour Eisen. It could possibly be.
The Chairman. Do you know whether it was or not ?
Mr. Seymour Eisen. No, sir.
The Chairman. Who would have kept the money?
Mr. Seymour Eisen. Mr. Lansky.
The Chairman. Did he have a safe at the Casino ?
INIr. Seymour Eisen. There is a safe at the Casino.
The Chairman. Were you ever present when a dividend was paid
at the end of the season ?
Mr. Seymour Eisen. No, sir.
The Chairman. Senator Plunt?
Senator Hunt. For the record I think it ought to be clear that if
you refer to the bank, you don't mean tlie commercial bank; you
mean the bank at the Casino?
Mr. Ben Eisen. No, sir. All the restaurant money was deposited
in the bank account in the bank.
Senator Hunt. But the money from the Casino was not?
Mr. Ben P^isen. No, sir.
Senator Hunt. You have been referring always to the bank as the
bank of the casino, haven't you ? You used the term meaning — —
Mr. Ben Eisen. Bankroll.
Senator Hunt. Meaning a bankroll?
Mr. Ben Eisen. Yes, sir.
Senator Hunt. I see.
The Chairman. Ben and Seymour, you w^ill be
Mr. H ALLEY. There is just one other line of questioning that was-
called to my attention.
You also do the accounting, do you not, Ben, for the Hollywood
Kennel Club?
Mr. Ben Eisen. I am comptroller there. I am not the accountant.
We have the accountant come in at the end of the season and make up
the report for the State and for the income tax.
Mr. Halley. You haven't yet given us those records for the Holly-
wood Kennel Club.
Mr. Ben Eisen. No, I didn't bring any records for the Hollywood
Kennel Club, but I will be glad to.
Mr. Halley. You will give them to us ?
26 'ORGANIZED CRIME IN INTERSTAT'E COMMERCE
Mr. Ben Eisen. Whatever you want, I will be glad to have you
come up and check it.
Mr. Halley. Does Mr. Erickson own any part of the Hollywood
Kennel Club?
Mr. Ben Eisen. No, sir.
Mr. Halley. None whatsoever?
Mr. Ben Eisen. No, sir.
Mr. Halley. Does Mr. Briggs?
Mr. Ben Eisen. No, sir.
Mr. Halley. Do you know whether or not Joe Adonis is related to
Costello?
Mr. Ben Eisen. Only from the paper I know he is a nephew.
Mr. Halley. Joe Adonis is Costello's nephew ; is that right ?
Mr. Ben Eisen, Yes.
The Chairman. Did you ask whether Frank Erickson owns any
part of the Kennel Club ?
Mr. Ben Eisen. Yes, sir ; he doesn't.
The Chairman. The record will show who owns it.
Mr. Ben Eisen. Yes, sir.
The Chairman. How many owners are there?
Mr. Ben Eisen. There are, I believe, six shareholders.
The Chairman. Can you tell us who they are?
Mr. Ben Eisen. Yes, sir. William J. Sims, Sr. ; William J. Sims,
Jr. ; Florence Strong; Lee McKichie ; Mrs. Barbara Roberts ; and there
is an old lady from Long Island who has about nine shares. I just
can't think of her name right now, but I will have it for you when you
need it.
There are 661 shares in the Hollywood Kennel Club.
The Chairman. Is there anything further, Mr. Halley ?
Mr. Halley. Yes, sir; are there any wire-service outlets at the
farm ?
Mr. Ben Eisen. I don't know, sir.
Mr. Halley. Don't you operate at the farm ?
Mr. Ben Eisen. No, sir; there is nothing operating at the farm.
Mr. Halley. Don't you keep the books there?
Mr. Ben Eisen. We just put them over there for storage. After
giving up the Club Boheme lease, they took all the stuff out.
Mr. Halley. Is it possible that a wire service could be operating
there without your knowledge?
Mr. Ben Eisen. Sure.
Mr. Halley. Seymour, do you know whether or not a wire service
operates at the farm?
Mr. Seymour Eisen. I don't know of any wire service at the farm,
sir.
Mr. Halley. Thank you. That is all.
The subj)enas lliut have been served upon you, Ben and Seymour,
are continuous in etl'ect subject to further order of the committee.
Mr. Ben Eisen. Right. Is there anything else this afternoon?
Mr. Hai>ley. We have some more witnesses.
TESTIMONY OF MRS. HAZEL HIBBS
Mr. Hai,ley. Will you state your name?
Mrs. Hii5BS. Mrs. Hibbs; Hazel Hibbs; H-i-b-b-s.
ORGANIZED CKIME IN EVTERSTAT'E COMMERCE 27
Mr. Hallet. What is your address, Mrs. Hibbs ?
Mrs. Hibbs. 246 Northwest Thirty-first Street.
Mr. Halley. Miami ?
Mrs. Hibbs. Miami.
The Chairman. Mrs. Hibbs, under the rules of the committee, all
witnesses have to be sworn. AVill you rise ?
Do you solemnly swear that the testimony you are about to give
the committee will be the truth, the whole truth and nothing but the
truth, so help you God ?
Mrs. Hibbs. I do.
Mr. Halley. IVIrs. Hibbs, will you tell us where you are employed 'i
Mrs. PIiBBs. I w^ork for Louis" Gillman, Certified Public Account-
ant.
Mr. Halley. Louis Gillman ; G-i-1-l-m-a-n ?
Mrs. Hibbs. That is right.
Mr. Halley. Where is Air. Gillin'm's ofiice located?
Mrs. Hibbs. 1224 Ingraham Building.
Mr. Halley. Miami ?
Mrs. Hibbs. Miami.
]\fr. Halley. Do you know whether or not Mr. Gillman does the
accounting work for a firm known as the S & G Investment Co.?
Mrs. Hibbs. I have never seen anything on it.
Mr. Halley. Have you ever seen anything on the S & G Syndi-
cate ?
Mrs. Hibbs. No, I haven't.
Mr. Halley. Do you know where Mr. Gillman is?
Mrs. Hibbs. He went to Cuba today with the Shrine convention.
Mr. Halley. Is he expected back ?
Mrs. Hibbs. He will be back Monday.
Mr. Halley. Will you state where he lives ?
Mrs. Hibbs. I think the address is 427 Northeast Twenty-sixth
Street ; I believe that is right.
JVIr. Halley. In Miami ?
Mrs. Hibbs. In Miami.
Mr. Halley. How long have you worked for Mr. Gillman?
Mrs. Hibbs. About 8 years.
Mr. Halley. In what capacity ?
Mrs. Hibbs. As his secretary.
Mr. Halley. How many people are in Mr. Gillman's office ?
Mrs. Hibbs. At the present time I believe are two young ladies
and about four boys ; about six people, you might say.
Mr. Halley. What are the functions and duties of each of the young
ladies ?
Mi's. Hibbs. They are typists.
Mr. Halley. Are they subordinate to you ?
Mrs. Hibbs. Yes, sir.
Mr. Halley. And the boys do what?
Mrs. Hibbs. The boys are auditors.
Mr. Halley. Do they work directly under Mr. Gillman?
Mrs. Hibbs. Yes, sir.
Mr. Halley. Are you generally familiar with Mr. Gillman's ac-
counts.
Mrs. Hibbs. I know what accounts he has and audits.
28 ORGAlSriZED CRIIME IN INTERSTATE COMMERCE
Mr. Halley. Have you ever heard of Mr. Harry Russell ?
Mrs. HiBBS. No, I haven't.
Mr. Halley. Have you ever heard of Mr. Harold Salvey ?
Mrs. HiBBS. No, I haven't.
Mr. Halley. Mr. Charles Friedman?
Mrs. HiBBS. No ; I don't.
Mr. Halley. Mr. Jules Levitt ?
Mrs. Hibbs. No ; I never heard of him.
Mr. Halley. Samuel P. Cohen ?
Mrs. Hibbs. Yes, I have.
Mr. Halley. You have heard of Mr. Samuel P. Cohen ?
Mrs. Hibbs. Yes, sir.
Mr. Halley. Is he a client or customer of Mr. Gillman's?
Mi-s. Hibbs. I believe he is a brother-in-law of Mr. Gillman's. I
think that is the relationship.
Mr. Halley. In what business is Mr. Cohen ?
Mrs. Hibbs. I honestly don't know what he does.
Mr. Halley. Does Mr. Gillman do any accounting for Mr. Samuel
P.Cohen?
Mrs. Hibbs. I believe he made up his income tax. That is the only
thing I know of.
Mr. Halley. Have you ever heard of Mr. Edward Rosenbaum ?
Mrs. Hibbs. Yes, I clid.
Mr. Halley. Would you say who he is ?
Mrs. Hibbs. I don't know who he is. He was in the office, but that is
as far as I know.
Mr. Halley. Does Mr. Gillman or his company do any accounting
for Mr. Edward Rosenbaum?
Mrs. Hibbs. No. I think several years ago he made up an inconie
tax for him, but not recently.
Mr. Halley. Has Mr. Rosenbaum been in the office recently ?
Mrs. Hibbs. No ; he hasn't.
Mr. Halley. Have you ever heard of Mr. Joseph Friedlander ?
Mrs. Hibbs. No, I don't know him.
Mr. Halley. Mr. Jack Friedlander?
Mrs. Hibbs. No.
Mr. Halley. Have you ever heard of the wire service dealing with
horse-race information ?
Mrs. Hibbs. No. My work is strictly accounting, and I have charge
of tlie typing department and the files.
Mr. Halley. Does Mr. Gillman do the accounting work for any
people in the bookmaking business?
Mrs. Hibbs. No, I wouldn't know that. I wouldn't know whether
he is connected with bookmaking or not.
Mr. Halley. But you might from the files have noticed whether the
business of certain of his customers was bookmaking?
Mrs. Hibbs. Not that I know of. I wouldn't know whether he was
or not.
Mr. Halley. I am not quite sure I understand your answer. Is it
that you wouldn't know or that you don't know of any?
Mrs. Hibbs. I don't know of any.
Mr. Halley. In other words, to your best knowledge, there are no
customers or clients of Mr. Gillman's who are in the bookmaking
business?
(ORGANIZE© CRIME IN mTERSTATE C'OMMERGE 29
Mrs. HiBBS. Not that I kilow of.
Mr. Halley. I have no further questions, Mr. Chairman.
The Chairman. Senator Hunt?
Senator Hunt. I have no questions.
The Chairman. Thank you very much, Mrs. Hibbs.
TESTIMONY OF ABE ALLENBERG
Mr. Halley. Will you state your name?
jNIr. Allenberg. Abe Allenberg.
Mr. Halley. What is your address?
Mr. Allenberg. 3301 Collins Avenue.
Mr. Halley. The Robert Richter Hotel?
Mr. Allenberg. Yes, sir.
The Chairman. Mr. Allenberg, will you stand and hold up your
right hand ? Do you solemnly swear that the testimony you will give
this committee will be the truth, the whole truth and nothing but the
truth, so help you God ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Mr. Allenberg, you were served by me with a subpena
duces tecum ?
Mr. Allenberg. Yes, sir; I was.
Mr. Halley. That subpena asked for certain records ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Do you care to make a statement about those records?
Mr. Allenberg. Whatever papers I have are over at the Boulevard
Hotel in packages, because I was at the hotel. My lease expired and
we were moving out of there and we wrapped everything up in bundles
and I w^ould have to go over and open the bundles and see how many
papers I have on the Tropical Park situation. Tropical Park Manor
and the Wofford Hotel. All the papers that I have will be over there.
Mr. Halley. These papers relate, do they not, Mr. Allenberg, to
the ownership of certain interests in the Tropical Park Race Track
which was in your possession as a trustee; is that correct?
Mr. Allenberg. Yes, sir.
Mr. Halley. And to the ownership of an interest in the leasehold
of the Wofford Hotel?
Mr. Allenberg. Yes, sir.
Mr. Halley. And do they also relate to the ownership of the Boule-
vard Hotel ?
Mr. Allenberg. No ; it would be the lease of the Boulevard Hotel.
Mr. Halley. And to various other ventures in which Mr. Frank
Erickson appears in one way or another ?
Mr. Allenberg. Mr. Erickson does not appear in the Boulevard
Hotel at any time.
The Chairman. When are you going to get the records ?
Mr. Allenberg. As soon as I can. IBy tomorrow afternoon I will
try to have them. The building is closed up and it is dark there at
night. I will go there tomorrow morning.
The Chairman. All right, sir.
30 ORGAXIZED C'RIIME IN INTERSTATE COMMERCE
TESTIMONY OF CHARLES B. COSTAR, ACCOMPANIED BY
WILLIAM G. WARD, ATTORNEY
Mr. Halley. Your full name is Charles B. Costar ?
Mr. Costar. Yes, sir.
Mr. Halley. Your address is the First National Bank Building,
Miami, Fla ?
Mr. Costar. Yes, sir ; 903, if you want the room number.
The Chairman. Mr. Costar, do you solemnly swear that the testi-
mony you will give this committee will be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Costar. I do.
Mr. Halley. Mr. William G. Ward is appearing as attorney.
Mr. Ward. Personal attorney for Mr. Costar.
Mr Halley. What is your address ?
Mr. Ward. 1229 Dupont Building.
Mr. Halley. Do you want to make a statement, Mr. Ward?
Mr. Ward. I want to make this statement : When Mr. Costar called
me about 3 : 30, I was advised by telephone at about 2 o'clock or 2 : 30
that my associate Eobert Ward came down here and Mr. Costar told
me what the situation was. He is an accountant here with some large
practice and a large office and I told him to get whatever files he had
available and bring them down even though he was not subpenaed.
So he is here for the purpose in his professional capacity of giving
you any information he has, and if you want more files or records,
they are available to you.
I also want to make this statement : With reference to his constitu-
tional rights, not on behalf of himself but on private information
which he has for some of these clients, I assume the usual laws apply,
the same as the other, and unless the client himself claims immunity,
he is privileged to give whatever information he has.
The Chairman. That is our usual resolution. We appreciate your
cooperation, JNIr. AVard.
Mr. Costar. Senator, may I say this : I haven't yet received the sub-
pena, and as I told you a moment ago, they looked for me and I wasn't
there. My wife met me at the train and said, "They were looking
for you."
I wanted to let you know I want to cooperate with you.
The Chairman. We appreciate that.
I think it would be best to serve a subpena on Mr. Costar.
Mr. Halley. The subpena whicli you issued. Senator Kefauver,
was issued to Mr. William B. Deegan. May I amend it to insert my
name instead?
The Chairman. Let it be amended.
Mr. Halley. And I will serve it upon Mr. Costar. Would you
like to read it, then we can talk about it?
Mr. Costar. I have read the print. Now I want to read the type-
written matter [reading].
All rjo-lit, sii'.
Mr. IIali,ky. Did you ever represent the Farm Casino?
Ml-. Costar. Yes, sir.
Mr. Halley. Do you now?
Mr. Costar. Well, that operated on the — as I recall from memory,
it was only ojie season, and Avhen I say "one season" I mean a period
ORGANIZED CRIME IN INTERSTAT'E COMMERCE 31
of 4, 5, or 6 weeks; maybe not tliat long. \Vliat we call the season
probably is anywhere from December through March or April.
Mr. Halley. Were you handling the accounting for the Farm Ca-
sino during that period?
Mr. CosTAR. My office was; yes, sir.
Mr. Halley. Were you personally familiar with it?
Mr. CosTAR. We were familiar to this extent : They gave us daily
reports of their operations and from that we wrote up records and
filed tlieir taxes; their tax returns.
Mr. Halley. Wlio were the owners of the Farm Casino?
Mr. CosTAR. It was a joint venture or partnership composed of
The Chairman. Mr. Costar, when did the Farm Casino operate?
You say it operated one season?
Mr. CosTAR. Yes, sir.
Mr. Halley. What season?
Mr. CosTAR. I will try to tell you from the file I have on it. It is
the only file. The period January 7 to April 30, 1944, and as I recall,
that is the only time it operated.
Mr. Halley. Do you have the records pertaining to the Farm
Casino available now?
Mr. CosTAR. This is the only thing I have, Mr. Halley. This is a
power of attorney and a letter of protest protesting the findings of
the agent. Let me qualify that.
We have been able to find in the short time I have been in the office
this afternoon
Mr. Halley. Do you liave the income-tax returns ?
Mr. CosTAR. No, sir ; I don't have it with me. We may not have
it. As a general rule, when the Treasury Department gets through
with the two or three clients I represented that are in this business,
we destroy them. After the assessments have been made of the re-
turns and the returns have been examined and they paid their de-
ficiency, if there is any due, and so forth, we just don't waste that
space.
Mr. Halley. Is it your testimony that you have destroyed the tax
returns representing or relating to the Farm Casino?
Mr. CosTAR. Not until I check further. I told you I got into my
office at about 3 o'clock and we checked to get as much as I could
together to come over here.
Mr. Halley. Did you check to see if you had the checks and tax
returns too relating to Farm Casino?
Mr. CosTAR. No. All the files and tilings I have here and if there
is anytliing
Mr. Halley. What files do you have to deliver to the committee?
Mr. CosTAR. The only one I have is this tax case.
Mr. Halley. Would you deliver that now pursuant to the sub-
pena?
Mr. CosTAR. Yes, sir; but I would like to have an inventory of it.
Mr. Halley, That can be done.
Mr. CosTAR. In detail. I would like to have a detailed inventory.
Mr. Halley. Would you make j^our inventory and we will cer-
tify to it.
Mr. CosTAR. All right, sir.
32 ORGANIZED CHIME IN INTERSTAT'E COMMERCE
The Chairman. Under those conditions, it will be made a part of
the record and Mr, Costar, we will work with you in getting any of
these back to you as quickly as possible.
Mr. Costar. Senator, may I say this: For all or anything that I
have in my office, you don't have to have a subpena. Just come and
get it, and if you want to have your people come there and work, I
will make them comfortable and give them a place to work in. We
want to cooperate with you. We have a number of accounts there
and over the years we have accumulated a lot of files.
Mr. Halley. Did you ever represent Frank Erickson personally?
Mr. Costar. No., sir. The only way Mr. Erickson has ever ap-
peared in my files was through this Farm Casino, he being one of the
participants.
Mr. Hai.ley. The Farm Casino is engaged in the gambling business ?
Mr. Costar. Yes, sir. It was a joint venture composed of a number
of men that operated it. Yes; they gambled out there. They had, I
believe, a crap game. I was never out there, and I am talking from
hearsay. I have never seen the operation, but I guess that would
cover it.
Mr. Halley. Do you represent any other clients who are in the
gambling business? I am not confining my questions to the matters
in the subpena.
Mr. Costar. Yes, sir. I would say that Charlie Thomas would be
classified as in the gambling business.
Mr. Halley. Would you spell the name ?
Mr. Costar. Charles Thomas.
Mr. Halley. Any others ?
Mr. Costar. And Jack Friedlander.
Mr. Halley. Do you still represent those two ?
Mr. Costar. Yes, sir.
Mr. Halley, Any others ?
Mr. Costar. Dave Byer. He is now deceased. He has been dead
for 2 years this May — this month.
Mr. Halley. Any others?
Mr. Costar. That is all I can think of right at the moment. These
others that are on here — Padget, Dyer, and Wall — those fellows have
been in this Farm Casino I know in operation with these other men,
but individually and personally I haven't represented either one of
those.
Mr. Halley. You understand the question is not confined to the
names recited on the subpena. Do you represent any other people at
all or company whose venture is in the gambling business?
Mr. Costar. There is one that you don't have on here that comes
to my mind, and that is Murl Yarborough — ]M-u-r-l.
Mr. Halley. Could we take these in order and would you state
their business. First I think you mentioned Dave Byer.
Mr. Costar. Yes, sir.
Mr. Halley. In wliat business is he?
Mr. Costar. When he was alive he was interested in the operations
of Mr. Thomas, tlie same operations, and was a partner in this joint
venture of tlie Farm Casino.
Ml-. Haixey. What is the present operation of Mr. Thomas?
Mr. Costar. Mr. Thomas didn't do anything this last year, so far
as I know.
ORGANIZED CE'IME IN ESTTERSTAT'E COMMERCE 33
Mr. Halley. What was his last-
Mr. CosTxVR. His last operation that he participated in was the
casino in Miami.
Mr. Halley. What Avas the name of it ?
I^Ir. CosTAR. Chib 86.
Mr. Halley. Was tliat a joint venture?
Mr. CosTAR. Yes, sir.
jNIr. Halley. Do you recall, without the aid of a document, the
others in the joint venture?
Mr. CosTAR. No, I don't. There are a number of them, Mr. Halley,
and I may have overlooked some of them. Mr. Thomas was in it,
Mr. Friedlander and I\Ir. Yarborough. I am not sure whether Mr.
Dyer was or not. I would have to refer to the record. There was a
lumiber of them.
I personally don't do a lot of this work, and I would have to go to
the records to be sure that I was telling you a true statement of facts.
Mr. Halley. Are there any other gambling businesses or ventures
of Cliarles Thomas wliich you recall now ?
Mr. CosTAR. Mr. Halley, I believe he has an interest in what you
call the numbers game, but I am not sure about that. I would have
to go to the records.
Mr. Halley. For the committee's benefit, would you state what
you mean by a numbers game ?
Mr. CosTAR. Just for the lack of a better name, perhaps, in Cuba
they have a lottery, and they sell tickets here, as I understand, on
the ending number : that is, from zero to 99. You can call that bolita
or lottery or numbers or whatever else. I have heard this and I
don't know from actual experience, but they have a daily operation
that they operate, and whether he is in it or not, I don't know. That
is something he will have to answer because I make up his returns
strictly from the information that he brings in on those operations ;
the figures that they submit on those operations.
Mr. Halley. You have those records and will turn them over to
the committee?
Mr. CosTAR. Yes, sir.
Mr. Halley. What are the operations of Jack Friedlander?
Mr. CosTAR. Club 86. Other than that I don't know except that in
preparing his return he tells me that he made this much money here,
that much there and elsewhere, and that is what we report on the
return.
]\Ir. Halley. Do these people — let us say Friedlander spcifically —
give you any records to support their statements?
Mr. CosTAR. Most of their operations are confined to joint ventures
and partnerships, and the income is from that source.
Mr. Halley. Is the income generally cash in the form of bills rather
than bankable checks?
Mr. CosTAR. In Club 86, Mr. Halley, we have a very complete set of
records. The other operations — and please make note of this until I
can verify it from the records — so far as I can recall, the other opera-
tions are maintained by other accountants — who they are, I don't
know, but they will come in at the end of the year or at tax return time,
and he will say, "This is what I made from this operation or that"
and so on and so forth.
34 ORGANIZED CmME IN INTERSTATE COMMERCE
Senator Hunt. May I ask: What do you mean by "an operation"?
Mr. CosTAR. Well, assuming that he has an interest in a baseball
pool. I am just using it as an illustration. I don't know, Senator.
He will come in and say, "Charlie, here is what I made on the baseball
pool last year." With that in mind, I will say, "Who are the part-
ners," and he will say, "Just don't worry about that. This is a part-
nership," and I will put that down on his return, or pass the informa-
tion on to my auditor to make up his return.
The only one I can recall right now without going to the records
that we actually kept the records on — and that is in a strictly super-
visory way — we are not there to keep the detail of it — is the Club 86.
The others he brings the information in to me.
Senator Hunt. Do you know if this Club 86 has like games going
in any other city or any other State, with a like organization or a like
set-up ?
Mr. CosTAR. Not to my knowledge. I don't know. Senator. I know
the Club 86 operation, but other than that I don't know anything
about it. We have a complete set of records on their operation out
there.
Mr. Hallet. The committee has seen a number of complete sets of
records — may I interpolate — because I am trying to get your views
as an expert rather than examining you on anything that you should
by inference think concerns you.
The committee has seen a number of so-called complete sets of rec-
ords which when examined carefully turn out to be dependent upon
unverified figures concerning the handling of large amounts of cash
which never get to a commercial bank and are simply stated from day
to day or week to week.
When you refer to a complete set of records, do you go behind the
figures given you concerning the handling of cash ?
Mr. CosTAR. No, sir; we don't. That would be impossible, Mr.
Halley, unless we had a crap table or a roulette table, but the internal
control we have out there is quite good.
Mr. Halley. Isn't it a fact that in all these gambling operations the
income day after day is in the form of large amounts of cash which
are never banked ?
Mr. CosTAR. Well, no; I wouldn't say that. I would say — and I
think the records will speak better than I can speak — as I recall, their
routine is to' put a large amount in the bank every day because they
always handle a lot of checks and they have to be cleared, and so forth.
Mr. Halley. Over and above what goes into the bank, isn't there
a large amount that never does go into the bank ?
Mr. CosTAR. I don't believe so, Mr. Halley. I don't know. The
record would have to answer that for me. I would like to refer to
that instead of my memory.
Mr. Hatjley. Would you say or do you know it to be a practice of
any gambling establishment to deposit each day the total receipts of
tlie day before in the bank?
Mr. CosTAR. I have advocated it, and up to a point — and what that
point is we will have to get from the record — they do deposit the day's
receipts, whether in cash or in checks.
Mr. Halley. Do you mean they deposit a part of the day's receipts ?
Mr. CosTAR. They deposit the entire receipts. I have advocated
that, but whether they followed it through or not, I don't know.
ORGANIZED C'R'IME IN INTERSTAT'E COMMERCE 35
Mr. Halley. Did you ever attempt to ascertain whether any of your
clients have taken that advice?
Mr. CosTAR. Bear in mind that the man on my staff is the man
doing the work. I have tokl them that and if they don't do it 100
percent of the time, or 90 or 40 percent or 20 percent — as I said, the
record will speak for itself better than I can tell.
Mr. Halley. Are your men on the premises each night?
Mr. CosTAR. No. sir.
Mr. Halley. Your men have to take the statements of the people
who are there?
Mr. CosTAR. That is correct. We strictly prepare their returns,
and in the case of Club 86 we write up the books and records from the
daily sheets and reports that are submitted to us.
Mr. Halley. Do you check the records in the case of Club 86 and
any other gambling ventures which you audit to ascertain whether,
on the face of the records, there are not comparatively large sums of
cash which never are deposited in the bank ?
IMr. Costar. Even their records as going into their own bank,
Mr. Halley. What do you mean by "their own bank" ?
Mr. Costar. They are just like a race track. They operate on the
some principle. The race track has a bank roll that they call the
B. K.— $300,000 or $500,000, and they maintain that figure, or upward.
It may run up to $500,000. Let us assume that they start with a bank
roll of $300,000. That may be high down here, or maybe $100,000, but
the principle is there, and if they don't deposit it, it will increase their
bank roll.
]\f r. Halley. That is in the form of cash on hand ?
Mr. Costar. Yes.
Mr. Halley. Which they record but keep on the premises?
Mr. Costar. Yes. It is kept in the armored truck. The armored -
truck people handle it.
Mr. Halley. Where do the armored-truck people put it?
Mr. Costar. In the safety-deposit vault. I know they are insured
and they are responsible for it.
Mr. Halley. Do you mean that all cash on the premises each night
is delivered to the armored truck ?
Mr. Costar. Oh, yes.
Mr. Halley. They do not have vaults of their own?
Mr. Costar. They have a small safe out there, but this bank roll I
have been told has been turned over to the armored-truck people.
Mr. Halley. Who are the armored-truck people ?
Mr. Costar. The only one here is Rolfe Armored Truck.
Mr. Halley. How do you spell it?
Mr. Costar. R-o-l-f-e."^
Mr. Halley. Do they service the various gambling establishments?
Mr. Costar. I don't know. I know they service the Club 86. That
is the only armored-truck service I know of, and I would say they
service all.
Mr. Hai^ey. From a tax-accounting standpoint, the practice, if it
does exist, of having sums of cash which are not deposited in the com-
mercial bank daily would leave the possibility of having income which
would not be reported or recorded in any way, would it not ?
Mr. Costar. No.
'36 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halle Y. How is it subject to control? Aren't you depending
on what you are told by your client ?
Mr. CosTAR. I just told you that they start with a bank roll of $300,-
000 or whatever it may be. That fluctuates either up or down either
in the bank or on deposit in the cash account.
Mr. Halley. On a particular day, say January 2 or 3 of 1950, the
bank roll starts at $300,000, and from the night's operations they
make $15,000. Is there any way in the world to show whether they
have $15,000 or whether they put in their own records $10,000 and
kept $5,000 in their safe or in their pocket ?
Mr. CosTAR. I think I answered that a moment ago when I said there
was an internal control.
Their procedure is that they have a money room, the same as a race
track operates, and that money is put in there. The table is set up,
and I get the procedure, and they charge that operator with so much
money. They put whatever is necessary to give him enough change.
He sells chips. If he gets too much money on the table he turns it
into the money room, or he puts the cash in a little slit and it drops
down into a box. Then somebody comes around and opens the box
with a key. They don't operate that way around here. I have never
seen that.
Mr. Halley. Suppose he sells $100 worth of chips.
Mr. CosTAR. His money is lying in a box.
Mr. Halley. And that is emptied from time to time ?
Mr. CosTAR. Yes, sir.
Mr. Halley. And if he wins, there are chips back on the next play.
There is no record of that, is there ? Does he keep any record of each
play ?
Mr. CosTAR. No.
Mr. Halley. He could deal $100 worth of chips over and above that
all night long and there would be no way to tell whether he sold his
$100 worth of chips 10 times or a hundred times.
Mr. CosTAR. Sure. If he starts with $5,000 and he ends up with
$30,000, he must have won $25,000.
Mr. Halley. You can't tell that if they empty the money as it is
won, which goes into a drawer periodically and emptied by one of the
employees of the house.
Mr. CosTAR. But a record is kept in the money room.
Mr. Halley. Wliat happens to the money in between ?
Mr. CosTAR. They receipt him for what they have taken off.
Mr. Halley. Do they give the teller a cash receipt?
Mr. CosTAR. Yes.
Mr. Halley. What does he do with those receipts?
Mr. Costar. I don't know.
Mr. Halley. Do you get them?
Mr. CosTAR. No; I don't. We don't get them. They keep that
record of what they put out in addition to any money they advance,
and by the same token they keep a record of what they take off.
Let us assume that, following througli your questioning, we put
$5,000 on and lie loses it in some dice game. Some guy comes along
and wins it and they have to pay him off. So they will draw an addi-
tional $25,000 from the money room and it is charged to the table.
So the money room is your control. There would have to be collusion
ORGANIZED CRIME IN INTERSTATE COMMERCE 37
between your operator and the tellers in the money room and the audi-
tor, or whoever it is in charge of the records at the casino.
Mr. Halley. Is there an auditor at these casinos?
Mr. CosTAR. They have a man there who does all of that.
Mr. Halley. Who is the man at Club 86 ?
Mr. CosTAR. I don't know, but I think Ashley was the one that did it
the last time.
Mr. Halley. What is Ashley's full name?
Mr. CosTAR. Tom is his full name — ^Tom Ashley.
JNlr. Halley. Wliat does Tom Ashley do? Doesn't he get a slip
periodically from the owners telling him what the net income or loss
from each form of gambling is ?
Mr. CosTAR. Not to my knowledge. The people I have represented
have never done anything like that. They just take it as it comes.
There are so many partners that it is impossible to work it that wa.y.
Mr. Halley. Let me ask you a hypothetical question and see
whether you would consider the following methocl of operation a
proper one. Suppose the moneys were deposited in the cashier's cage
through the course of any evening, and at the end of the night it was
counted by the owner of the house who kept a private record and
turned that record over to the auditor only at the end of the year.
Would you say that would be a proper mode of operation?
Mr. Costar. No ; I wouldn't say that would be proper because — well,
if the individual was reliable, it would be. But I, as an accountant,
couldn't accept that without some qualification. At Club 86 we don't
have that.
Mr. Halley. What qualification would you require in order to
accept it?
Mv. CosTAR. At Club 86?
Mr. Halley. Yes.
Mr. CosTAR. To begin with, you have many partners — 8, 10, or 12 —
I don't know how many without referring to the records, and you have
a number of people that this money goes through and the record goes
through their hands. You would have to have collusion among a great
many people before you could do that.
Mr. Halley. The individual who handles each table is not aware
of the total ?
]Mr. CosTAR. No.
Mr. Halley. So far as he know^s, the table next to him might be
having losses while he is winning ?
Mr. Costar. He doesn't know. It is all cleared through the money
room.
Mr. Halley. And the man that does the counting in the money room
doesn't keep these individual slips that are handled — these receipts —
to the tellers ?
Mr. CosTAR. Until the end of the day. Then he makes his recapitula-
tion.
Mr. Halley. So that if the man in the money room and the partner —
if there is any collusion, the addition at the end of the day is whatever
they want it to be.
Mr. CosTAR. They would have to be stealing from each other, or one
would be taking advantage of the other.
Mr. Halley. Not if they split evenly.
38 ORGANIZED CRIME IN INTERSTATE COMMERCOE
Mr. CosTAR. I am satisfied that with the way that is controlled out
there, that couldn't happen. The same thing would apply to a race
track.
Mr. Halley. You haven't convinced me that there is any way in
the world, when you have a man who is not one of your auditors who
is working for the people who run this place to sit in a game and count
the money and then destroys all slips at the end of the day. I am not
satisfied that there is any way in the world to keep him from marking
down the total for the day and any figures that his boss wants him to
mark down.
Mr. CosTAR. We must rely on honesty, which your records prove most
people are. Secondly, when you deal with a lot of people or more than
two people, you get into a lot of trouble and collusion and conniving
and scheming, and thirdly, somewhere along the line they would trip
themselves. There are three major factors that are against that. It
may happen. I am not saying it doesn't, but I think it is impractical.
Mr. Halley. But you have heard of it actually happening ?
Mr. CosTAR. I never heard of it happening with that number of
partners they have out there, or any other operation elsewhere. I
have never heard of it.
Mr. Halley. Have you never heard of money being taken off the
top at a gambling house ?
Mr. CosTAR. Yes, but I say where you had collusion with 8 or 10
partners or more, plus the men that work for you.
Mr. Halley. You need only the collusion of one man and that
is the man that does the counting in the cage.
Mr. CosTAR. You need more collusion than that if you understand
accounting.
Mr. Halley. With all these games going and a lot of receipts being
handled, no two men in the room have any idea of the total because
the man at one table is busy and he can't watch any other table but
his own.
Mr. CosTAR. I don't know.
Mr. Halley. The receipts are all torn up. If you kept the receipts
permanently you might have some check, but the very fact that the
receipts are torn up at the end of the day indicates a desire to elimi-
nate the possibility of a check.
Mr. CosTAR. I don't think they are torn up. I am not out there.
They may hold them for a week or 2 weeks or will hold them 8 weeks.
I don't know how long.
All I know is that they give us a recapitulation, and that is the
basis on wliich we make up the tax return and write the report on.
Have you ever been in a gambling casino?
Mr. Halley. If you don't mind, I will ask the questions.
Mr. CosTAR. When I said it, I realized what I had said, I am sorry.
Mr. Halley. Let's keep the questions on this side.
Mr. CosTAR. I was going to preclude explaining how a casino
operates.
Mr. Hall?:y. I have read books on it.
Mr. C'osTAR. If you want to take it off the record
Mr. Halley. (io ahead and explain it for tlie record because T
tliink that is important. You are not answering the questions for my
benefit, but for tlie ])enefit of the committee and for the record and
we are trying to get the benefit of your expert knowledge on it to
ORGANIZED CRIME IN INTERSTATE COMMERCE 39
ascertain Avliether or not this type of operation can possibly be con-
trolled so that when the tax point of view is concerned, there is a
proper safeguard for the j^ublic,
Mr. CosTAR, Mr. Halley, at Clnb 86 — and I have been in jnst a
couple of them in my time, they have a something built around the
wall with peepholes that look like air conditioning holes or whatever
you want to call them.
They have men stationed up there to watch these operators, and they
also have over each crap table, the times that I have been in the casino,
which hasn't been too many in my time — I have just visited them, they
have a man standing on a ladder or whatever you want to call it.
The scene is familiar and he looks down and he is watching those
players. You say to me, "Why do they do that?" For two reasons:
first, to make sure that the operator is not clipping them, and second
to see that there is not a lot of phoney dice being thrown by the players.
Beyond that I don't know what the purposes are, but that is a safe-
guard that is in most casinos.
You have men hidden behind this wall — at the Club 86 I am talking
about — plus the man that stands on the ladder. They then change those
men periodically often during the evening. How long they stay on
the ladders at a time I don't know, but Joe Doakes will be here for
10 minutes and Paul Smith will be at the same latter for another
10 minutes. That is another safeguard.
Mr. Halley. That is all very carefully described in an article in
The Saturday Evening Post about 2 weeks past dealing with Reno,
and it corroborates what you said.
Mr. CosTAR. I have never been there.
Mr. Halley. Aren't they there to see that the individual players and
dealers don't cheat the house ?
Mr. Costar. That is right.
Mr. Halley. For instance, a particular player who happens to be a
friend of a dealer, they want to make sure that he doesn't win too
often.
Mr. Costar. That is right.
Mr. Halley. But that very safeguard makes it so difficult for the
dealer to pocket the money that it is not really necessary for them to
follow through with this system of receipts and checks on their own
people very carefully. They are watching their own people very
carefully by watching and not by bookkeeping.
Mr. Costar. You have a thought there, but if you are the dealer and
I am the money-room man, I check you out, and there is my auditor
back here, and when he gets through at the end of the day and he
has checked you and given you $50,000 for that table tonight, you had
better check in with $50,000 or show you paid out $50,000 plus your
winnings. That is what he goes by.
Mr. Halley. There are seven other tables ?
Mr. Costar. Yes.
Mr. Halley. It all gets counted up rather carefully in the counting
room ?
Mr. Costar. That is right.
Mr. Halley. And the owner or the partners — two or three of them —
are in there with one low-paid employee who is called an auditor, and
he writes down the figures.
68958—50 — pt. 1 4
40 ORG'ANIZED CRIME IN INTERSTATE COMMERCE
Mr. CosTAR. I wouldn't say lie is low paid, and I don't know
that there are three or four partners. I have never been there at
the time of morning when they close.
Mr. Halley. How can you say that you are sure that the system
works if you have never been there to see the accounting? Isn't it
apparent that if one or two men are counting and calling off figures
to an auditor and they tear up the receipts as they go, they can pretty
well tell the auditor what they want ?
Mr. CosTAR. The auditor doesn't get it that way. The man in the
money room is charged up with the money he has turned out or sent
out and he has to get it back or get receipts for it and he makes his
daily report, and then it goes to his auditor or whoever keeps the
recap sheet.
Mr. Halley. Who is the money man ?
Mr. CosTAR. The man in charge of the money room.
Mr. Halley. Is he an accountant or is he one of the partners.
Mr. CosTAR. I don't know. I have never been in there in the morn-
ing when they closed up. I couldn't answer that.
Mr. Halley. I don't think I have any further questions, Mr. Chair-
man.
The Chairman. Mr. Halley, what about the records and all that?
Mr. Halley. We are going to collect them tomorrow and any rec-
ords you have you will turn over to the committee's investigator;
is that right ?
Mr. CosTAR. Yes, sir. Can I ask you a question on that? There
are a number of records and files. Rather than inventory those files,
I would like to have your re])resentatives work in my office, if possible.
Mr. Halley. We would like to have the records at least long enough
to study them in our own office, so perhaps the best thing is to inventory
them.
Mr. CosTAR. It is going to take some time ; a few days to get them
together.
Mr. Halley. You can generally inventory a file that big in an hour
by just picking up a paper and dictating from it.
Mr. CosTAR. You are welcome to it. It is not a question of not
turning it over.
The Chairman. Suppose w^e have someone meet with you in the
morning and see what can be done.
Mr. Halley. There will be somebody in your office at what time ?
Mr. CosTAR. We get in there on Saturday — I only have one young
lady come in and one of the men. We don't work on Saturdays except
to keep the office open with a skeleton crew.
Mr. Halley. I think it can be done on Monday. It will probably
be Mr. Rice.
Mr. Halley. Were any of the Friedlander operations outside of
the State of Florida or were they all local?
Mr. CosTAR. Mr. Halley, I couldn't answer that truthfully. I
would just guess.
Mr. Halley. Would the records show it?
Mr. CosTAR. I am not too sure about that. He might have said
"XYZ" partnership and we wouldn't have asked for an address.
On the other hand, I think the address is required on the tax returns,
and I think they would show the address.
ORGANIZED CRIME IN INTERSTATE COMMERCE 41
Mr. Halley. May I ask whether after you have produced these
records, if Mr. Rice, assistant counsel to the committee, has any ques-
tions, you wouhl have any objection to answering them ?
Mr. CosTAR. No ; I will be glad to. Let me repeat again : I will
cooperate with you in every way I can,
Mr, Halley, Thank you.
Mr. CosTAR. You don't have to subpena me or threaten me. I am
willing to cooperate with you and I want you to have the information
that you want.
Mr. Halley. Thank you very much.
The Chairman. Is there anything further, Mr, Halley ?
Mr, Halley, No, sir.
The Chairman. Do you have any questions, Senator Hunt ?
Senator Hunt. I have no questions.
The Chairman. Thank you, Mr. Costar.
The committee will stand adjourned until 9 a. m. tomorrow morning.
(Whereupon the committee adjourned at 5:55 p. m. until the fol-
lowing morning.)
INVESTIGATION OF OEGANIZED CKIME IN INTERSTATE
COMMEECE
SATURDAY, MAY 27, 1950
United States Senate,
Special Committee To Investigate Organized Crime
IN Interstate Commerce,
Miami^ Fla.
The committee met, pursuant to adjournment, in the courtroom of
the United States district court, at 9 a. m., Senator Estes Kefauver
(chairman) presiding.
Present: Senators Kefauver and Hunt.
Also present : Rudolph Halley, chief counsel.
TESTIMONY OF KALPH M. HART, ACCOMPANIED BY MR.
CHAPPELL, ATTORNEY
Mr. Halley. Will you state your full name and address ?
Mr. Hart. Ralph M. Hart, 211 Eclgewood Drive, West Palm Beach,
Fla.
The Chairman. Mr. Hart, will you stand and be sworn, please ?
Do you solemnly swear that the testimony you will give this com-
mittee will be the truth, the whole truth, and nothing but the truth,
so help you God 1
Mr. Hart. I do.
Mr. Halley. A subpena was served upon you yesterday to produce
certain records, was it not ?
Mr. Hart. Yes, sir.
Mr. Halley. The subpena asked for all records relating to John F.
O'Rourke, Frank Erickson, and Mickey Cohen?
Mr. Hart. Yes, sir.
Mr. Halley. Have you brought such records ?
Mr. Hart. Yes, sir.
Mr. Halley. Would you produce them now for the committee?
Mr. Hart. Here is the bank statements from 1943 to 1949, and such
deposits slips as were in my possession.
The Chairman. Mr. Counsel, I didn't understand. Is Mr. Hart
an auditor or a public accountant ?
Mr. Hart. I am a certified public accountant ; yes, sir.
The Chairman. And your office is here in Miami ?
Mr. Hart. No, sir. My office is in 310 Citizens Building, West
Palm Beach, Fla.
The Chairman. Mr. Chappell, you are from West Palm Beach?
Mr. Chappell. I am from Miami.
43
44 ORGANIZED CKIME IX INTER STATE COMMERCE
Mr. Hart. These are my tax files, which is the only work I do for
Mr. O'Rourke. I have the quarterly wage reports which I prepared
for him, and the income-tax returns.
Mr, Halley. Do you do any work for Mr. Erickson ?
Mr. Hart. No, sir.
Mr. Halley, I^ rank Erickson ?
Mr. Hart, No, sir.
Mr. Halley, You work only for O'Eourke?
INIr. Hart. Yes, sir.
Mr. Halley. Do you know whether he uses the services of any other
auditor or accountant?
Mr. Hart. Mr. O'Rourke?
Mr. Halley. Yes.
Mr. Hart. Not that I know of.
Mr. Halley. Do you handle all his work ?
Mr. Hart. Yes, sir.
Mr. Halley. Wliat is his business ?
Mr. Chappell. Go ahead and tell him,
Mr. Hart. I think he operates a handbook. That is what we call it.
Mr. Halley. Where does he operate it ?
Mr. Hart. West Palm Beach.
Mr. Halley. What is a handbook ; would you state it just generally ?
Mr. Hart. He books horse bets.
Mr. Halley. And does he lay off his bets with anybody ?
Mr. Hart. Yes; he does.
Mr. Halley. With whom ?
Mr. Hart. I don't know whether I can say as to that. My work is
income-tax work. He has lay-off bets and action and pay-off bets and
checks with various people, and I don't know any of them.
Mr. Halley. What names appear in the checks and records.
The Chairman. Mr. Hart, I think we will get along better, and
your attorney will tell you so, if you tell vis without any reluctance
what you know about that.
Mr, Chappell, He is willing to do that.
Mr. Hart, I will be glad to do that.
The Chairman. We don't have to go by the strict rules that are
observed in a court. This is not a criminal trial. We are making a
senatorial inquiry to see what the picture is and what kind of legisla-
tion we want to recommend to the Senate. So, we would appreciate
your cooperation.
As I said, we are not bound by the strict rules of evidence that pre-
vail in courts in which you have had some experience. We will make
better time and we will understand that some of this may be second-
hand information that you tell us, or other than of your own knowl-
edge. So, I thought I would like to make that explanation to you,
Mr, Hart. I don't know enough about his operations to say who he
lays off bets to.
Mr, Halley, Certain names appear. Would you name the people
with whom he does business?
Mr, Hart, He has done lots of business with Mickey Cohen. He
has had business transactions with Frank Erickson. Those two names
appear on my subpena.
Mr. Halley. Do any other names occur to you besides those which
were given to you on the subpena ?
ORGANIZED CR'JME IN ESPTERSTAT'E COMMERCE 45
Mr. Hart. Well, you know those things are not important for my
work. I have them in my files.
Mr. Halley. Mr. Hart, bear this in mind : Following up what Sen-
ator Kefauver said, you have given us just the two names we have
reason to believe you know about. I don't consider that cooperative
spirit. It seems to me that relying only on that and not remembering
at this point isn't very convincing. There must be other people. A
man can't operate a handbook and lay offs just in that way.
Mr. Hart. There are other people.
Mr. Halley. Who are they ?
Mr. Hart. I don't know.
Mr. Halley. Have you any idea?
Mr. Chappell. How long would it take you to look at your records
and find out?
Mr. Hart. I can look through them very quickly and find out. I
don't remember these people's names. I don't know them.
Mr. Halley. Go ahead and refresh your recollection,
Mr. Hart. I recall a list of checks payable to one man, that the
checks were borrowed by the Treasury Department, and I have their
receipt for them. I can't recall the man's name. It was Luke Church.
Mr. Halley. Where is Luke Church located ?
Mr. Hart. Luke Church — I don't know the man. All I have here is
this receipt for canceled checks that I gave the Treasury Department.
I have three pages of it.
Mr. Chappell. I think he is from Miami.
The Chairman. Mr. Chappell thinks he is from Miami.
Mr. Chappell. We feel that he lives in Miami here.
Mr. Halley. Mr. O'Rourke will be in to give us that information.
The Chairman. He hasn't had time to look and see any others.
Mr. Hart. I will have to go to the canceled checks to do that. I
don't know the names. They are in there but I don't know the names.
Mr. Halley. May I suggest that we take the testimony and per-
haps while Mr. O'Rourke is testifying Mr. Hart can look through
the checks and resume the stand later ?
The Chairman. So ordered.
Mr. Halley. Does Mr. O'Rourke have a partner in the handbooks ?
Mr. Hart. No, sir ; he does not.
Mr. Halley. He owns that himself?
Mr. Hart. Yes, sir.
Mr. Halley. Does he have any other businesses ?
Mr. Hart, No other business activities that I know of.
Mr. Halley. Does he operate any business at the Boca Raton Hotel ?
Mr. Hart. Not at the present time ; no.
Mr. Halley. Did he at one time ?
Mr. Hart. Yes, sir. He operated a business that developed recently ;
that he operated a business there during two winter season with that
New York man — what's his name again ?
Mr. Halley. Frank Erickson?
Mr. Hart. Frank Erickson.
Mr. Halley. Have you met Frank Erickson ?
Mr. Hart. No, sir.
Mr. Halley. What business did he operate at Boca Raton ?
Mr, Hart. They booked horse bets.
46 ORGANIZED CRTME IN KSTT'ERSTAT'E COMMERCE
The Chairman, Louder, Mr. Hart.
Mr. Hart. They booked horse bets.
Mr. Halley. From the guests of the hotel ?
Mr. Hart. Well, I would have to guess at that. I was never there
and I don't know, l3ut that undoubtedly is correct.
Mr. Halley. During what years did they operate ?
Mr. Hart. Well, it was 1947-48 season and 1948-49, I believe.
Mr. Halley. Did they operate in 1949-50 at Boca Raton ?
Mr. Hart. Not to my knowledge.
Mr. Halley. Did Mr. O'Rourke have any other business in 1947-48
or 1949 that you know of?
Mr. Hart. Yes, he had a crap game.
Mr. Halley. Wliere?
Mr. Hart. West Palm Beach.
Mr. Halley. At what premises was it operated ?
Mr. Hart. It was upstairs, the northwest corner of Lamanna Street
and Dixie Highway.
Mr. Halley. Was it connected with any restaurant ?
Mr. Hart. No, sir.
Mr. Halley. Or place of entertainment?
Mr. Hart. No, sir,
Mr. Halley. Did he own that himself ?
Mr. Hart. Yes, sir.
Mr. Halley. Did he have any business at the Roney Plaza Hotel ?
Mr. Hart. Not to my knowledge.
Mr. Halley. Did you file an income tax report for the Boca Raton
operation ?
Mr. Hart. No, sir.
Mr. Halley. Did you keep the books on that ?
Mr. Hart. No, sir.
Mr. Halley. Who did?
Mr. Hart. I don't know. I didn't even know about it until he — I
didn't know he operated there until probably December 1949, during
an income-tax investigation.
Mr. Halley. Did you keep the books on the crap game operations ?
Mr. Hart. No, sir. No books were kept on those operations. It is
all done by bank operation, and his tax returns are prepared from
bank deposits.
Mr. Halley. You mean each day's receipts are deposited in the
bank?
Mr. Hart. No, I don't think that is correct. In the operation the
cash bankroll consistently runs short. They deposit checks only.
Very seldom is there an excess of actual cash because they take in
checks. They deposit the checks and if the cash bankroll runs short,
they write a check to cash to reimburse bankroll.
Mr. Halley. Do you know in what bank the crap game deposited
its money ?
Ml'. Hart. It all went in the same bank account.
Mr. Halley. What account is that?
Mr. Hart. AVell, in recent years he has been using the Atlantic Na-
tional Bank in West Palm Beach.
Ml-. Halley. Does he also use that to bank for the book that he
keeps there ?
Mr. Hart. Yes, sir, it is all in the same bank account.
ORGANIZED CKIME IN INTERSTATE COMMERCE 47
Mr. Halley. Does Mr. O'liourke have any other businesses?
The CiiAiEMAN. You say "in recent years." How about in past
years ?
Mr. Hart. He had a bank account at the Florida Bank & Trust Co.
prior to this and he has had a bank account in the First National at
Palm Beach.
Mr. Halley. The Florida Bank & Trust Co. in West Palm Beach?
Mr. Hart. Yes, sir.
The Chairman. Has he continued those three accounts or have they
all been merged into the one at the Atlantic National Bank?
Mr. Hart. Those accounts have been continued. I have the bank
statements. The activities have been through the Atlantic National
Bank in recent years.
Mr. Halley. Pursuant to the subpena, you have brought the state-
ments and canceled checks for all of these bank accounts; is that
correct ?
INlr. Hart. Yes, sir.
Mr. Halley. Do you know of any other business that Mr. O'Rourke
had during the years, say, from 1946 to date?
Mr. Hart. No other business activities. He had a few little invest-
ments.
JSIr. Halley. What type of investments 2
Mr. Hart. He bought a mango gi'ove; a grovelet. I think it is a
development where the development maintains a grove for some years.
The checks would go through regular in payment of the contract, and
he had an investment in a piece of property in. Riviera, Fla.
Mr. Halley. Is that in Florida ?
Mr. Hart. Yes. Riviera Beach, Fla.
Mr. Halley. Does he have any other property or real estate?
Mr. Hart. Not that I know of, no, sir.
Mr. Halley. What were the net profits for the crap game during
the year 1949 ?
Mr. Hart. I don't notice it. It is all in one account. It is all com-
bined when it gets to me.
Mr. Halley. Who works up those figures and gives them to you ?
Mr. Hart. I prepare the tax returns from the bank statements.
Mr. Halley. You can't tell a profit in a crap game from a bank
statement alone, can you ?
Mr. Hart, I can tell the combined profit of the operations, yes, sir.
Mr» Halley. You make no effort to segregate the crap game from
the books and any other business that he may have ?
Mr. Hart. No, sir. It is all in one bank account.
Mr. Halley. In other words, your tax return is prepared on the
assumption that all moneys received and all disbursements go through
the bank account ?
Mr. Hart. The payroll is paid in cash. It doesn't go through the
bank account.
Mr. Halley. Is it your testimony that all cash that Mr. O'Rourke
received in any way except that which is disbursed for payroll or
other leiritimate expenses goes through the bank account?
Mr. Hart. He takes out a withdrawal to the account of cash.
Mr. Halley. Does he report that to you ?
Mr. Hart. Yes, sir.
48 ORGANIZED CRIME IN INTERSTATE COMMERCaB
Mr. Halley. What is that drawmg account?
Mr. Hart. I think it has been $50 a week.
Mr. Halley. And you deduct that or rather add that to the net
income ?
Mr. Hart. I add that to his income,
Mr. Halley. Just $2,500 a year in cash ?
Mr. Hart. Yes.
Mr. Halley. Is there any other cash that you allow for ? Cash that
is withdrawn ?
Mr. Hart. There are other adjustments. He may make a loan at
the bank, borrow some money or pay off a loan or may borrow some
money from some of his friends, and those adjustments I have to make
to the bank statement to arrive
Mr. Halley. Let's confine the discussion to cash. Is it your testi-
mony that all of the cash which he receives in any of his operations
is deposited in the bank account?
Mr. Hart. That is the plan he works under. I don't handle the
deposits, but I have no reason to doubt the cash is deposited.
Mr. Halley. The only cash which would go in the bank account is
$2,500 a year which he draws, and cash which is used for actual busi-
ness disbursements?
Mr. Hart. Yes, sir.
Mr. Halley. But you have no check on that at all ?
Mr. Hart. I have no check on it ; no, sir.
Mr. Halley. You just accept that statement from him; is that
right ?
Mr. Hart. Yes, sir.
Mr. Halley. What was the net profit for his operations in 1949 ?
Would you refer to the records ?
Mr. Hart. I can't tell you about 1949. It doesn't amount to any-
thing because they have been closed and I haven't filed a 1949 return
yet.
Mr. Halley. What do j^ou mean when you say that they have been
closed ?
Mr. Hart. They have not been open for operations. The State
has been sewed up.
Mr. Halley. There was no book kept in 1949 ?
Mr. Hart. There was a little bit of booking done on the telephone
and so on, but I don't think it pays expenses.
Mr. Halley. Is it your testimony that Mr. O'Kourke was not op-
erating for the year 1949?
Mr. Hart. Well, it is my testimony that his place of operations has
been closed the majority of the year. I think they operated — the}'-
were closed January 7 or 8, 1949, and they have been in there some
with the doors closed and about — did a little telephone business, but I
don't know how much.
Senator Hunt. Why were they closed ?
Mr. Hart. The heat was on.
Senator Hunt. Do you know the source of the lieat ?
Mr. Hart. No; I couldn't swear that I do.
Senator Hunt. Wliore was tliat jilace of business?
Hr. Hart. In the Grand Hotel or on Datura Street, in the Grand
Hotel building, not the hotel proper.
ORGANIZED CRIME IN INTERSTATE COMIVIERCE 49
Senator Hunt. How many rooms did he occupy ?
Mr. Hart. Two.
Senator Hunt. How many employees did he have ?
Mr. Hart. That would vary from six to eight or nine.
Senator Hunt. Could you give us the names of the employees?
Mr. Hart. Yes, sir.
Senator Hunt. Are they in your records?
Mr. Hart. Yes, sir.
Senator Hunt. How many telephone outlets did he have ?
Mr. Hart. I don't know anything about that, sir.
Senator Hunt. Where did he get his wire service ?
Mr. Hart. Well, there was a leased wire that came in there to West
Palm Beach and the operator distributed the service to all the books
there.
Senator Hunt. Would your records show by canceled checks who
and the amount he paid for this service.
Mr. Hart. I think so.
Senator Hunt. Do you know if there were any checks made pay-
able to the Continental Press?
Mr. Chappell. I was talking to Mr. O'Rourke and he told me all
of his checks were made payable to cash; that he was requested to
make them that way.
Mr. Halley. What service did he use ?
Mr. Chappell. I just wanted to say that I thought it might be of
assistance in giving him a thought.
Mr. Hart. The checks are payable to cash, but they all bear the
endorsement "for deposit."
I don't recall the names he mentioned.
Senator Hunt. These various telephone outlets that he had, were
they all in his name?
Mr. Hart. I don't know anything about that.
Senator Hunt. Was he a wholesaler or retailer of this press serv-
ice; that is, did he receive his wire information and then retail it
cut, or did he use it for his own purposes and sell it directly to the
bettor?
Mr. Hart. Sell it.
Senator Hunt. If you were placing a bet with him, the only wire
service he would utilize — he would utilize that wire service for his
own information. He wouldn't sell that wire service to you that
you might go out and retail it again ?
Mr. Hart. No.
Senator Hunt. He was not in the nature of a wholesaler of book
or wire information?
Mr. Hart. No ; I wouldn't think so.
Mr. Halley. What is the last year in which the book did operate ?
Mr. Hart. 1948.
Mr. Halley. What was the net profit?
Mr. Hart. I will have to look at the record.
Mr. Halley. Would you look it up ?
Mr. Hart. That was a very poor year. He shows a net profit of
$1,702.45. ^
Mr. Halley. $17,000?
Mr. Hart. No, sir; $1,700.
50 ORGANIZED CRIME IN INTERSTAT'E COMMERCE
Mr. Hallet. What operations are shown in that return ?
Mr. Hart. Handbook.
Mr. Halley. What was the net on the handbook?
Mr. Hart. The figure I just gave you — $1,702.45.
Mr. Hallet. Is that the total net income reported by him?
Mr. Hart. No, sir. He had interest, $379.75.
Mr. Halley. How about the operation at Boca Eaton ?
Mr. Hart. It is in these figures.
Mr. Halley. In those figures ?
Mr. Hart. Yes, sir.
Mr. Halley. Wliere is it? Where are your work sheets showing
how you arrived at it ? You have all the papers here, do you not ?
Mr. Hart. Yes, sir.
Mr. Halley. Let us have the work sheets showing how you got the
$1,702.45 figure ; do you have that ?
Mr. Hart. Yes, sir.
Mr. Halley. Let's review them. What operations are shown in the
work sheets?
The Chairman. Let's get this clear. This is for what year ?
Mr. Hart. 1948.
The Chairman. Is that the calendar year 1948 ?
Mr. Hart. Yes, sir.
The Chairman. All right. What is the date of the return you have
just referred to ?
Mr. Hart. 1948 calendar year.
Mr. Halley. Is it dated March — where is the copy of the return ?
The Chairman. This return is undated, but this is an individual
income-tax return for the year 1948. It would have been sent in early
some time in 1949 ; is that right?
Mr. Hart. I think I had an extension on it. It probably was sent
in 60 days after March 15.
The Chairman. Yes, sir. All right. Go ahead.
Mr. Halley. Turning to your work sheets, would you explain the
figures and show first the source of income for 1948 ?
Mr. Hart. I arrived at the income by taking the bank deposits and
eliminating items which are not income.
Mr. Halley. You are now talking about gross income for 1948 be-
fore expenses ?
Mr. Hart. That is right.
Mr. Halley. What is the gross income for 1948 ? That is, as shown
by the work papers ?
Mr. Hart. $489,139.42.
Mr. Halley. That is actual income gross ?
IVIr. Hart. That is the gross receipts from the business.
Mr. Halley. And it is your contention from a business grossing
four-hujidred-and-eighty-nine-thousand-odd dollars there was a net
profit of $1,702.45 ; is that right?
Mr. Hart. During the course of income-tax examination, I would
admit there is probaJilv an error of about $1,000 in that.
Mr. Halley. About $1,000?
Mr. Hart. Yes, sir.
Mr. Halley. What are the sources of income ?
Mr. Hart. What are the sources of income ?
ORGAlSriZED CRIME IN mTERSTATE COMMERCE 51
Mr. Halley. Yes. How much did the handbook make and how
much did the operation at Boca Raton make?
Mr. Hart. I have no separation on tliis. I don't think there was
a crap game. I don't know whether there was in 194:8 or not. I woukl
like to look at tlie records.
That was ck)sed before the books was. I have no segregation of
the different businesses. They all went through one bank account.
Mr. Halley. Did the Boca Raton business have its own separate
bank account ?
Mr. Hart. No, sir.
Mr. Halley. You testified that you didn't even know until 1949
that there was a Boca Raton business. If it all went through a bank
account and you knew about it when you prepared the 1948 income
tax, it seems to me you would have known there was a Boca Raton
business before December 1949.
Mr. Hart. I am telling you now that I didn't know until December
1949. I knew there was a Boca Raton business but I didn't know
Frank Erickson had anything to do with it. I knew Mr. O'Rourke
operated there and that funds went through the bank.
Mr. Halley. Are you now changing your testimony ?
Mr. Hart. No, sir.
Mr. Halley. I recall very definitely your testifying that you didn't
know there was such a thing as an operation at Boca Raton.
Mr. Hart. I said I did not know there was any such thing as a
partnership at Boca Raton.
Mr. Halley. Will the stenographer please go back and read back
that portion of the witness' testimony concerning what we have been
talking about?
(The record was read by the reporter.)
Mr. HxVlley. May the record show that the earlier portion of the
witness' testimony has been read to him.
Do you have any comment now with reference to whether or not
you want to change your earlier testimony, because it is quite apparent
that your earlier testimony was that you didn't know there was such
a thing as an operation at Boca Raton by Mr. O'Rourke.
The Chairman. Until December 194:9.
Mr. Hart. My testimony, whatever it is, should have been that I
did not know of the operation by a partnership in Boca Raton. I
knew of Mr. O'Rourke 's operation, but I believed that it was a pro-
prietorship operation and had no knowledge of Erickson's connec-
tion with it.
Mr. Halley. You have testified previously that you didn't file an
income-tax return for the Boca Raton operation because you didn't
know about it.
Mr. Hart. I don't think I testified to that.
Mr. Halley. Mr. Hart, did you file the income-tax report for the
Boca Raton operation?
Mr. Hart. It was a partnership return, which I did not file.
Mr. Halley. Do you have a copy of the partnership return ?
Mr. Hart. I think I do ; yes, sir.
Mr. Halley. Will you produce it?
Mr. Hart (searching through documents). I don't have it.
Mr. Halley. The subpena that was served upon you called for all
the papers relating to O'Rourke and Erickson. That was clearly
within the terms of the subj)ena, was it not?
52 ORGANIZED CRIME IN m'TERSTAT'E COMMERCE
Mr. Hart. It is not there.
Mr. Halley. Do you know where it is ?
Mr. Hart. No ; I can't say that I do. I thought I had it with me.
Mr. Halley. Do you have some additional records in your office?
Mr. Hart. It might be in my office.
Mr. Halley. Do you have correspondence in your office?
Mr. Hart. Regarding these matters?
Mr. Halley. Yes.
Mr. Hart. No, sir.
Mr. Halley. Where is the correspondence regarding these matters,
and by "these matters" I am referring to Mr. O'Rourke's transactions.
Mr. Hart. I would have no occasion to have any correspondence
with him.
Mr. Halley. I note there is some correspondence with the Bureau of
Internal Revenue in these files that you have been thumbing through.
Mr. Hart. Yes ; there is some with the Bureau of Internal Revenue.
Mr. Halley. When you receive a copy of a tax return from another
a ccountant, there is at least a transmittal letter, isn't there ?
Mr. Hart. Well, I don't have any — there were no transmittals with
these returns. They were delivered to me by Mr. O'Rourke.
Mr. Halley. I don't believe that, and I believe you do know who
prepared the return. I believe that you are just evading the questions
of the committee and are attempting to give the committee as little
information as possible.
Mr. Hart. That is your privilege.
Mr. Halley. That is a fact.
The Chairman. Mr. Hart, let me ask you a question. When did
you get this partnership return for 1948 of Erickson and O'Rourke ?
Mr. Hart. During an income-tax examination on Mr. O'Rourke's
1948 return.
A revenue agent came in and a man named Price and asked some
questions and asked if I had a copy of the partnership return for
Boca Raton and I told him I didn't know there was any partnership
down there, and he said "Yes," there was, and he gave me what in-
formation he had about it and I call Mr. O'Rourke and asked him
about it and he said "Yes," he thought Erickson filed a partnership
return, and I said I would like to see it, and I asked him to bring it
down to me and he looked it up and brouiiht it to me.
The Chairman. What do you think you have done with it?
Mr. Hart. I don't know. I thought I had it in the file with me.
Mr. Halley. I don't know how you could prepare the 1948 tax re-
turn without the partnership return before you if you were reflecting
the income from Boca Raton in this tax retnrn for 1948.
Mr. Hart. The income is in these deposits.
Mr. Hali^ey. How do you know? You are a certified accountant'^
Mr. Hart. Yes.
Mr. Halley. And you are a lawyer?
Mr. Hart. Yes, sir.
Mr. Halley. How do you know the income is in those deposits?
Mr. Hart. That is already in the record; that I don't know. I
have been told here that I am not bound by the strict rules of evidence
in this testimony ; that I can give you what: I do know and what I think
about it. If you want to pin me down to Avhat I can actually swear
to, I don't know anything about these operations.
ORGANIZED CRIME IN INTE'RSTAT'E COMMERCE 53
Mr. Halley. How can you prepare this tax return witliout know-
ing it and have it on the return ?
Mr. Hart. I prepared the tax return from the information as fur-
nished and as stated.
Mr. Halley. And that information as stated was simply all the
income that went into a bank account ?
Mv. Hart. Yes, sir.
Mr. Halley. Without any break-down?
Mr. Hart. Yes, sir.
Mr. Halley. You are agreeing with me that there was no break-
down at all showing where the income came from?
Mr. Hart. I don't know what business it came from. There is no
segregation between the different businesses.
Mr. Halley. You don't even know that certain businesses were in
existence, did you ?
Mr. Hart. I knew the business was in existence, but I didn't know a
partnership was in existence.
Mr. Halley. You testified that you didn't know until the end of
1949 that there was any business at all. I presume that you are
changing that testimony and you are now saying that you did know
there was a Boca Raton business.
Mr. Hart. I definitely didn't know and I don't think I testified I
didn't — I was testifying about the partnership return and at the
time I stated I didn't know that existed.
Mr. Halley. That record will stand as it reads. What I want to
know now is if you did know there was a Boca Raton business and a
separate partnership, how could you accept these figures and not
have asked, at the time you prepared this report, for a partnership
return for Boca Raton, or a statement from the auditor for the part-
nership? How could a lawyer or an auditor prepare an income-tax
return without getting a statement from the auditor who prepared
the partnership return ?
INIr. Hart. When I prepared this return, I didn't know there was a
partnership.
Mr. Halley. You knew there was a business?
Mr. Hart. Yes.
Mr. Halley. Where were the figures for the business ?
Mr. Hart. In this bank account.
Mr. Halley. Did you think that the book at Boca Raton grossed so
little that it wouldn't show up larger than the figures you have in
your gross-income figures for 1948?
Mr. Hart. I have not any reason whatever to doubt the fact that
the money was being deposited in this account.
Mr. Halley. Do you have the work sheets for the previous years ?
The Chairman. Just a minute on that.
Mr. Halley. I want to compare them, sir. I want to show the
size. Let's say we have 1947 and 1946.
Mr. Hart. 1 have 1947.
Mr. Halley. Do you have 1946 ?
Mr. Hart. Yes.
Mr. Halley. When did the Boca Raton operations start ?
Mr. Hart. They operated two seasons. I thought I had those
returns.
54 ORGANIZED CROME IN INTERSTATE COMMERCE
Mr. Halley. Wasn't it the season of 1947-48 and the season 1948-
49?
Mr. Hart. That is what I think it was ; yes, sir.
Mr. Halley. So that the first year in which any income from Boca
Raton wonld be reflected would be the winter season starting around
January 1948 because the winter 1947-48 would show no real opera-
tions before the season opened in January at a place like Boca Raton;
isn't that so ?
Mr. Hart. No ; I don't think it is. I think they opened earlier than
that.
Mr. Halley. Then there may have been some income in 1947 from
Boca Raton?
Mr. Hart. I think so.
Mr. Hatxey. There would be a great deal of income starting Janu-
ary 1948 into 1948 from Boca Raton; isn't that right?
Mr. Hart. I don't know what you mean by income. There would
be a
Mr. Halley. I am talking about gross income. There would be a
greater volume of receipts. Gross receipts?
Mr. Hart. Yes.
Mr. Hali,ey. If you are dealing with an individual business and
not a partnership, then in your work sheets showing gross income,
you would have the gross income from the whole book operation at
Boca Raton and not merely the net profit.
Mr. Hart. That is what I am testifying that I believe I do have, sir.
I have no reason to question it.
Mr. Halley. Yet, if you take your gross receipts for 1948 — what
are they?
Mr. Hart. Gross receipts from business were $489,179.42.
Mr. Halley. And for 1947?
Mr. Hart. $453,917.14.
Mr. Haixey. And for 1946?
Mr. Hart. $410,949.43.
Mr. Halley. Where are your work sheets showing tlie specific
expenses at the Boca Raton Hotel ?
Mr. Hart. I wouldn't have that except on those copies of tax returns
that I was furnished.
Mr. Halley. How did you file your 1948 income-tax return
yourself?
Mr. Hart. I have that right here.
Mr. Halley. You have ]3reviously testified that you didn't keep any
of the books for the Boca Raton ?
Mr. Hart. That is correct.
Mr. Halley. Then how could you reflect the Boca Raton income in
this 1948 income-tax return?
Mr. Hart. I have answered that question three times.
Mr. Halley. I would like to have you answer it again, please.
Mr. Hart. I am of tlie opinion, and I have been told, that the
receipts from the Boca Raton Club are in these gross receipts in this
bank account.
Mr. Halley. That would be gross receipts from the Boca Raton
Club?
Mr. Hart. No, sir. I didn't say that. I said that the gross receipts
from the Boca Raton Club are in these items.
ORCANIZED CRIME EST ESPTERSTATE COMMERCE 55
Mr. Haixey. The fjross receipts from the Boca Raton Chib would
be in the gross items that you have reported here ; is that right?
Mr. Hart. That is my honest opinion.
Mr. Hai.lf.y. They woukl all liave been deposited in the Atlantic
National Bank because that is where all these items come from?
Mr. Hart. Yes, sir, I believe that to be true.
Mr. Hali.ey. Do you want this committee to believe that you
thought that during the years that Mr. O'Rourke was operating at
Boca Raton his gross income didn't go up at all; that the gross
amount of bets that he handled didn't ,go up? If you compare your
gross income for 1948 with the gross income foi- 1047 and for 194G,
jou will see that it is substantially the same, and I ask you if you
don't know that the gross income from Boca Raton in 1949 was sub-
stantially, alone, in excess of $750,000?
Mr. Hart. No ; I don't know that.
Mr. Halle Y. If that is the fact, is it even possible that you could
have reflected gross receipts from Boca Raton in this figure of 1948
showing total bank deposits of about $552,000?
]Mr. Hart. It would have been possible to have had $750,000 receipts
and $552,000 deposits.
Mr. Halley. The whole theory of your tax returns falls if I am
right.
Mr. Hart. No, sir.
Mr. Halley. You have testified that the bank deposits showed all
of Mr. O'Rourke's income. That is the theory on which you j)repared
the tax return ?
Mr. Hart. That is correct.
Mr. Halley. And that your tax returns reflect Boca Raton for 1948.
It is a sheer impossibility isn't it ?
Mr. Hart. Not that I know of, sir.
Mr. Halley. How do you find $750,000 in $552,000 ?
Mr. Hart. I am not trying to find it. You are the one who found it.
Mr, Halley. You are stuck with it, and what I would like to have
you reconcile is that that is an honest tax return with the statement I
have made, and you have to accept my statement that the gross receipts
for Boca Raton in 1948 were in excess of $750,000.
Mr. Hart. I have testified regarding the figures I have here, and
I have told you what they are and what in my opinion they are made
up of.
Mr. Halley. Do vou contest my statement that the gross receipts
for Boca Raton in 1948 were $750,000 ?
Mr. Hart. I am saying that I clon't know anything about that.
Mr. Halley. You should know something about it.
Mr, Hart, All I know is what you have told me,
Mr. Halley. That is not right. That is not right at all. You
have seen the partnership returns for Boca Raton. You have told me
that. That is your testimony.
Mr. H-:U?T. That is right. I have seen the partnership return.
Mr. Halley. But somehow or other, you forgot to biing it down
here. Do you know why ?
Mr. Hart. I can only say in that respect that it was not intentional.
I thought I had it with me, and I don't know why I don't have it.
Mr. Halley. If you have seen it and discussed it in connection with
an inquiry of the Bureau of Internal Revenue, you must have in mind
68958— 50— pt. 1 5
56 ORG'AXIZED CRIME IN INTERSTATE COMMERCE
the size of the operation at Boca Raton. It must have been very
forcibly brought to your attention in your discussions with the Bureau
of Internal Revenue.
Mr. Hart. No, sir.
Mr. Hallet. Isn't it a fact that you have already offered to pay
the Bureau of Internal Revenue a very substantial sum in settlement
of a claim for additional tax for Mr. O'Rourke ?
Mr. Hart. Suppose you say Avhether it is a fact or not.
Mr. Halley. Suppose you do. Suppose you testify by answering
questions.
Mr, Hart. It is not a fact
]\Ir, Halley. You have never offered to pay a substantial sum to the
Bureau ?
JNIr. Hart. No sum of any kind, substantial or unsubstantial.
Mr. Halley. You have been discussing the payment of additional
sums, have you not ?
Mr. Hart. No, sir.
Mr. Halley. Have you had any discussions with the Bureau ?
Mr. Hart. They examined Mr. O'Rourke's return; the usual dis-
cussions.
Mr. Halley. Have they asked for an additional payment ?
ISIr. Hart. Yes, sir,
Mr. Halley. Have you flatly refused to make any additional
payment?
;^Ir. Hart. They have not asked for an additional payment. They
have proposed an additional assessment which in the ordinary course
of business would not be payable until assessed,
Mr. Halley. Has any discussion taken place in compromise of that
proposal ?
JSfr. Hart. Not to my knowledge; no discussions with me were had
in connection with any compromises, and I have never heard of it.
Mr. Halley. In looking at that partnership tax return which you
received and which you asked for, is that your testimony — that you
asked for it after a dispute arose with the Bureau of Internal Revenue?
Mr. Hart. That is right.
Mr. Halley. Then you asked Mr. O'Rourke to get that for you?
]Mr. Hart. I asked him if there was a partnership return and he
said he tliought maybe there was that Erickson had entered, and if
he could find it he would bring it in.
Mv. Halley. And he brought it ?
INIr. Hart. Yes, sir,
Mr. Halley. And when you got it, did you look at it ?
Mr. Hart. Yes.
Mr. Halley. Did you notice that the gross income was far in excess
of the total gross income that you stated in your own return for all
operations?
Mr, Hart, Well, I wouldn't say that I did, I think perhaps you
are confusing gross receipts and deposits, which are not the same
by any means. That return, I think, showed gross receipts. These
figures that I am testifying here from my work papers are not neces-
sarily the gross turn-over or the gross receipts. They are the gross
deposits.
Mr. Haeley. What is the difference between gross receipts and gross
deposits ?
ORGANIZED CR!IME IN INTERSTATE COMMERCE 57
Mr. Hart. You might book $6,000 worth of bets and only win $1,000.
The $1,000 woukl be deposited. Tlie $5,000 you would pay back out.
I tliink that is where the difference is between the size of these figures.
Ml'. Halley. If anything, your receipts would be even greater tlian
your bank deposits and your work sheets should show the receipts.
Mr. Hart. I don't know whether they should or not.
Mr. Halley. Are you an accountant ?
Mr. Hart. Yes, sir.
Mr. Halley. Don't you think the work sheets should show the gross
receipts of a business^
JNlr. Hart. I think the work sheets I have here are correct.
Mr. Halley. You say they are correct, but you don't really think
they are correct.
j\Ir. Hart. I think they are correct.
JMr, Halley. How do you reconcile that with the gross receipts
of the Boca Raton operation?
Mr. Hart. The gross receipts of the Boca Raton operation are
undoubtedly set up on a win and lose basis. The gross receipts as I
show them are really gross receipts less losses.
Mr. Halley. Let's go over that. Let's take your statement for
1948. Here are your gross receipts there, $489,109.42 ?
Mr. Hart. Yes, sir.
Mr. Halley. What are they ?
JMr. Hart. That is the
jNlr. Halley. Are they wins less losses? I think that is what you
just said.
Mr. Hart. That is the bank clearances; that is what it is. You
don't deposit your losses. You may have a $3,000 bank roll, do
$27,000 worth of business and you may break even.
]\Ir. Halley. Do I understand
Mr. Hart. That is not from the gross amount of money taken.
Mr. Halley. Do I properly understand that the $489,000 repre-
sents the amount of money O'Rourke won in 1948 ?
Mr. Hart. No, sir.
Mr. Halley. You said it was wins less losses. Is that his net win-
nings for 1948— $489,000?
Mr. Hart. No, sir.
Mv. Halley. What is it?
Mr. Hart. It is his bank deposits.
ISlr. Halley. That is no answer. You said it represented wins
less losses.
Mr. Hart. Each day's deposits — they deposit the checks they take
in. They may do $10,000 worth of business and wind up with $4,000
wortli of checks and only make $500 for that matter.
The Chairman. What is that bank roll listed here ?
Mv. Hart. That is tlie bank roll, things written in to reimburse the
bank roll in this business. The cash l)ank roll consistently runs short.
Tlie Chairman. What is the pay off?
]\Ir. Hart. That is the payment of bets, or lay-off. Lay-off may be
there also.
Tlie Chairman. Then as I understand it, you also have the amounts
paid off either to lay off or payment of bets?
Mr. Hart. By check. These are all checks : no cash transactions.
58 ORG'AXIZED CREVIE EST IN'TERSTATE COMMERCE
The Chairman. Wliere did you reflect the amount of the bank roll
that finally came in the fixing up of this 1948 income ?
Mr. Hart. That is the bank roll which was kept at Boca Eaton ?
Mr. Chappell. Senator, will you let me say something that might
clarify the situation ?
The Chairman. All right, Mr. Chappell.
Mr. Chappell. As I understand it, O'Rourke was really an agent for
Erickson in the Boca Katon operation. That is the way I understand
it.
The Chairman. Agent for whom ?
Mr. Chappell. Erickson.
Mr. Halley. Do you mind my interrupting? I think that if you
wanti:o testify to that, we will accept your testimony, but I must
advise you not to testify to it until you know the facts.
Mr. Chappell. I thought it would clarify it.
Mr. Hallet. It doesn't clarify it. It contradicts the Imown facts.
If you want to testify to that so that the record will show that that
is your version of the facts, we will accept the testimony.
Mr. Chappell. I think you know as well as I do that I couldn't
testify to it.
Mr. Hallet. I think you were confusing the facts because the facts
are not as you say.
I am sorry, Mr. Chairman. I have no further questions on this line,
unless the committee would like to proceed further.
The Chairman. I wanted to get from Mr. Hart again the sources
of Mr. O'Rourke's income.
Mr, O'Rourke had an interest in his partnership in Boca Raton dur-
ing the time that you have stated ; is that correct ?
Mr. Hart. I am told that that is correct ; yes, sir.
The Chairman. And he also had his own crap game in West Palm
Beach?
Mr. Hart. He has had.
The Chairman. Anyway, during the same time or at some time he
had the operation at Boca Raton, he had a crap game in West Palm
Beach?
Mr. Hart. Yes, sir.
The Chairman. And then he had an orchard or a grove ?
Mr. Hart. That is one of his investments. I think it is nonpro-
ductive yet.
The Chairman. And he also had a furniture and fixtures business ?
Mr. Hart. No, sir. I think you are looking at the depreciation
schedule on his tax return. I took depreciation on the furniture and
fixtures in his place of business.
The Chairman. Those are the only businesses that you know of?
Mr. Hart. Yes, sir.
The Chairman. That you have recited ?
Mr. Hart. Yes, sir.
The Chairman. How about that partnership return? You have
got it somewhere.
Mr. Hart. I am sure I do have it ; yes, sir.
The Chairman. How are we going to get an opportunity to see it?
Mr. Hart. Well, I don't understand why I don't have it with me.
How would you like to have it ? Shall I make you a copy of it ? Any-
thing you say.
iORGA]NnZED CRIME IN INTERSTATE COMJSIERCE 59
Mr. Halley. I think probably you ought to get it down here just
as fast as you can— the return itself. It will have to go into evidence.
Mr. Hart. I will be glad to do that. I don't know why it is not
here.
The Chaxrmaist. Mr. Rice will be here, and we will make some
arrangement for Mr. Hart to give it to him.
Mr. Halley. Give it to Mr. Rice at the hotel this evening or dur-
ing the later afternoon if you can get it back here by 3 or 4 o'clock,
The committee will be in the courthouse here.
Mr. Hart. I don't see how I can get it back here by that time. I
have to go up to get it.
Mr. Halley. In the later part of this afternoon you can deliver it
to Mr. Rice who is at the McAllister Hotel.
Senator Hunt. Do you have anyone in your office whom you can
ask to pick it out and send it on down ?
Mr. Hart. I wouldn't know where to have them look for it because
it should have been in the file. It is probably on my desk. It will
take time to go through the file.
The Chairman. If you can't find Mr. Rice, Mr. Brown, would you
be the custodian for it %
Mr. Brown. I would be glad to.
Mr. Halley. Also this file stripped down bare of all memoranda,
correspondence — anything but official papers that you are required to
keep.
Mr. Hart. I don't have any correspondence for that man. I just
simply do his tax work. I have a little correspondence with the
Treasury Department and that is about all.
The Chairman. Mr. Hart, did Mr. O'Rourke sign these tax re-
turns himself?
Mr. Hart. Yes, sir.
The Chairman. You didn't sign tliem as the person having pre-
pared the return for him ?
Mr. Hart. I guess so.
The Chairman. How about the partnership return? Does it have
the person who prepared it on it %
Mr. Hart. I don't know, but I think so. I think it does.
The CiL\iR3iAN. Mr. Hart, just in the ordinary run of things, if
somebody brought a tax return that was in controversy, or a copy
of one, being a lawyer and an accountant, the first question you would
ask would be, "Who prepared this?" Wouldn't that ordinarily be
the first question you would ask ?
Mr. Hart. I must have asked that question ?
The Chairman. You must have asked that question.
Mr. Hart. It doesn't appear to me who prepared it. There it is.
It has been filed.
The Chairman. Suppose you wanted to question some figure about
it, wouldn't you like to know the person who prepared it so you could
check with him and get some explanation of some of the items?
]Mr. Hart. Not unless I found it necessary to question it. I would
just get a co])y of a return, and if I found something wrong with it,
something I didn't think was right, naturally we would inquire who
prepared it.
The Chairman. You have no idea who prepared it ?
60 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Hart. I tliiiik the return shows. I know tlie orij^inal shows.
The Chairman. AVhat is your independent idea as to who prepared
it ? You must have some idea.
Mr. Hart, Mr. Erickson had it prepared. I suppose his account-
ants did. I don't know. I didn't do any work for Erickson. I never
met the man.
The Ch airman. Is it your understanding that the tax return was
prepared in New Jersey or New York and sent down to Mr. O'Rourke,
or that a copy was sent to him ?
Mr. Hart. Yes, sir.
The Chairman. How did you get that understanding?
Mr. Hart. Because 1 got the return from Mr. O'Rourke. He
brought it to me.
The Chairman. Why do you think they were prepared in New
York or New Jersey ?
Mr. Hart. Because that is where Erickson operates. I suppose
it is from there.
The Chairman. Have you had any correspondence with the man
who prepared it?
Mr. Hart, No.
The Chairman. Did you ever see Mr. Erickson?
Mr. Hart. No, sir; not to my knowledge. I may have seen him,
but not that I know of.
The Chairman. Mr, Halley, what other information is in these files?
Mr. Halley, I want to offer in evidence, so they can be examined
by the committee after the witness has testified, a box containing
canceled checks, vouchers, and bank statements.
The Chairman. It will be received in evidence and made a part
of the record,
(Box containing canceled checks, vouchers, and bank statements
received in evidence as exhibit No, 39A. Later returned to witness
after analysis by committee.)
Mr, Halley. I offer in evidence two folders containing income tax
returns, copies, work papers, and other documents relating to income-
tax returns of Mr, O'Roui'ke, submitted here by Mr, Hart,
The Chairman. Let them be marked and received in evidence.
(Folders of income tax returns, work papers, etc., received in
evidence as exhibit No. 39B. Later returned to w^itness. )
Mr. Halley. And I offer in evidence, as a separate exhibit, but part
of exhibit No, 39 A, an exhibit comprising 15 checks, either payable
to or endorsed by or bearing notations with the name "Mickey Cohen."
The Chairman. Let them be marked and received in evidence.
(Group of 15 checks payable to or endorsed by Mickey Cohen re-
ceived in evidence as exhibit No. 39C. Later returned to witness. )
The Chairman, I wanted to ask Mr. Hart one or two questions
about those checks. They may have been asked while I was out of
the room.
Senator Hunt. They were not.
The Chairman. Mr. Hart, do you know how this operation worked,
this lay-off business ; how these checks happened to be issued to Mickey
Cohen and to the Atlantic National Bank with Mickey Cohen's name
on the left of it?
Mr. Hart. Well, of course I don't have any personal knowledge of
that, but I am satisfied I know, but I can't swear that I know.
ORGANIZED CR'IME IN INTERSTAT'E C'OMAIERCE 61
Senator Hunt. Give us your opinion.
The Chairman. Tell us what you know about it,
Mr. Hart. As I understand it, Mickey Cohen telej^honed Mr.
O'Rourke and <2:ave him some business and they discussed matters and
Mr. O'Rourke agreed to take some business, and they would have a
set agreement to pay, whenever either one owed the other as much as
$5,000, and the settlements always went west. There didn't any of
them come east.
The Chairman. You mean that Mickey Cohen would lay off bets
with Mr. O'Eourke?
Mr. Hart. I would guess so. I wouldn't know whether it was lay
off or what it was.
The Chairman. And the other way around ; Mr. O'Eourke would
bet with or lay off bets with Mickey Cohen ?
]Mr. Hart. Yes, sir.
The Chairman. Is this referring to bets on the horses or is this in
connection with the Boca Eaton operation ?
Mr. Hart. Both of those. Boca Eaton is a horse-book operation.
Those checks are all in connection with bets on horses.
The Chairman. They haven't anything to do with his crap game
in West Palm Beach ?
Mr. Hart. No, sir.
The Chairman. There is one check in particular that I want to get
your explanation of, and that is the check dated October 17, 1947,
payable to the Atlantic National Bank and made by John F, O'Eourke.
In the left-hand corner is a notation "Mickey Cohen B." How was
that check cashed ? It has no endorsement.
Mr. Hart. That was the initial settlement, I believe, and that was
cashed and the money sent by Western Union to ]Mickey Cohen. I
believe that is correct on that check.
The Chairman. Then Mr. O'Eourke apparently took this check to
the Atlantic National Bank and withdrew the money in cash, desig-
nating that it was withdrawn in order to get it to Mickey Cohen, and
apparently he took the cash and sent it to Mickey Cohen by Western
Union ?
Mr. Hart. I think that is correct.
The Chairman. That check was never sent through the mails to
Mickey Cohen, was it?
Mr. Hart. No, sir.
The Chairman. Eeferring here to the check of October 17, 1947,
which apparently is the same date as the check we have been referring
to, check No. 127, there is a check of $3,495, payable to Mickey Cohen
with a little notation "B" in the upper part, and signed or made by
John F. O'Eourke. That check bears the endorsement of Mickey
Cohen and Michael Cohen. Apparently it was deposited m the
Hollywood-McFadden branch of the Citizens'-something bank in Los
Angeles, Calif. ; is that correct ?
Mr. Hart. I think so ; yes.
The Chairman. How about the checks that Mickey Cohen sent to
Mr. O'Eourke?
Mr. Hart. Well, I don't know whether Mickey Cohen was smarter
than Mr. O'Eourke or whether he had some hot horses but there were
never any checks that came that way.
62 ORG!A]SnZED CRIME IN ESTT'ERSTATE COMMERCE
The Chairman. So that check would have been sent through the
mails?
Mr. Hart. That is right. He got him hooked at the start and kept
him hooked.
The Chairman. Mr. O'Ronrke would bet on horses in California
and would bet through Mickey Cohen and he always lost ; is that the
way it was, or a lay-off proposition ?
Mr. Hart. No, sir. Mickey Cohen did most of the betting with
him and his horses won.
The Chairman. Where is the record of the transactions of the bets
between John F. O'Rourke and Mickey Cohen ?
Mr. Hart. I never have seen any. These are the settlements.
The Chairman. There would have to be some way of keeping up
with them. These are very substantial amounts of money that they
have been passing around.
Mr. Hart. Evidently they do keep it.
The Chairman. Here is one check dated June 7, 1948, No. 292, made
out to cash in the amount of $5,000. That one is endorsed by Lyle
Woodhall; is that correct?
Mr. Hart. Yes, sir.
The Chairman. Is that for the purpose of getting money and send-
ing it out by Western Union to Mickey Cohen ?
Mr. Hart. There was one sent by Western Union and one sent by
cashier's check, I believe, and I don't know which is which, to tell
you the truth, but this man who endorsed this check is Mr. O'Rourke's
cashier.
The Chairman. Lyle Woodhall?
Mr. Hart. Yes, sir.
The Chairman. "Wliat is this notation in the upper left-hand
corner ?
Mr. Hart. The B means bank roll, and the C means Mickey Cohen.
The Chairman. You are satisfied that these checks or the proceeds
from these checks were sent to Mickey Cohen ?
Mr. Hart. I have no reason to doubt it.
The Chairman. Anyway, you reported it in the work sheets or
income tax as disbursements ?
Mr. Hart. That is right.
The Chairman. Did you check the Western Union records to see
whether they had been sent ?
Mr. Hart. No, sir. During the course of this income-tax examina-
tion, the revenue agents checked that and gave me the information.
Senator Hunt. Are these both Mr. O'Rourke's signatures? They
obviously are not the same handwriting. So which is his signature ?
The Chairman. For the record, we are comparing checks Nos. 155
and 127.
Mr. Hart. I think they are both his.
Senator Hunt. These signatures appear to be entirely different.
Mr. Hart. I don't see much difference. It is a different pen, but I
am sure that is all Mr. O'Rourke's writing. It is written apparently
with a heavier hand or a different pen, but I believe those are both
his writing.
Senator Hunt. There is a difference in the F.
Mr. Hart. That is the only difference I see — in the F. You take
the R. It is a peculiar R and it follows right straight through.
ORGANIZED CR'IME IN INTERSTATE COMMERCE 63
Senator Hunt. I am not a handwriting expert, but I don't see any
similarity about them.
The Chairman. Is there anything further?
]\Ir. H ALLEY. I have one or two questions further. Would you
explain the items listed under "bank roll"? What is the bank roll?
I am now referring to the 1948 work sheets.
Mr. Hart. Those are the funds from which they pay their losing
bets.
Mr. Halley. Is that a cash fund ?
Mr. Hart. Yes, sir.
Mv. Halley. I presume that at the beginning of the year, January
1, 1948, Mr. O'Rourke started out with a certain amount of money in
cash which he calls his bank roll ; is that right?
Mr. Hart. That is right.
Mr. Halley. And as it is diminished, it is replenished with cash
drawn from the bank by check ?
Mr. Hart. Yes, sir,
Mr. Halley. For example, you show here payments to the bank roll
of $5,000, $3,000, $5,000, $2,000, and so on down the line, making a total
of payments to the bank roll of $221,400; is that right?
Mv. Hart. That is right.
Mr. Halley. AVhat was his original bank roll as of January 1, 1948 ?
What did he start with?
Mr. Hart. Apparently there was no change from 1947. I will have
to determine it. Apparently there was no change from 1947.
Mr. Halley. How much did he have in this cash bank roll on Janu-
ary 1, 1948 ?
'Mr. Hart. The standard bank roll has been $3,000.
Mr. Halley. Do you mean that that is the capital that he uses?
Mr. Hart. Tliat is the bank roll he handled for the cashier.
IMr. Halley. Does he have a bank roll at the book as well as at the
crap game?
Mr. Hart. They use the same one. They use it in the book in the
daytime and the crap game at night.
Mr. Halley. And when the bank roll needs more money, a check is
just made, cash is taken out and put in the bank roll ; is that right?
Mr. Hart. That is right.
Mr. Halley. How do you know that the money that goes into the
bank roll is actually paid to pay losses in gambling?
Mr. Hart. I haven't said I did know.
Mr. Halley. Is there any way anybody in the world would know
that Mr. O'Rourke is not putting that money in his pocket, or some
substantial amount which in 1948 amounted up to $221,400 ?
Mr. Hart. I don't know how anyone would know.
Mr. Halley. I have no other questions.
The Chairman. With regard to these checks to replenish the bank
roll, how would they be made ? Cashed and the money taken out of the
bank?
Mr. Hart. Cashed at the bank.
The Chairman. That would be done by Mr. O'Eourke himself?
Mr. Hart. He writes the checks and may send somebody to cash
them.
The Chairman. May send his cashier around ?
64 ORGANIZED CEIIME IN INTERSTATE COMMERCE
Mr. Hart. Or some other employee who is available at the time.
The Chairman. Are there any records at Boca Raton or at the dice
game to show that these replenishments, as represented by checks, were
actually receipted into the bank roll?
Mr. Hart. I don't think so.
Mr. HaiXey. Don't you keep the betting sheets ?
Mr. Hart. I probably had the betting sheets, but they sure don't
keep them.
Mr. Halley. What do they do with them ?
Mr. Hart. They are destroyed.
Mr. Halley. Each day?
Mr. Hart. I think daily.
Mr. Halley. What motive would they have to destroy them if
these are honest records that we have been talking about ?
Mr. Hart. They have frequent raids by the law-enforcement officials
and they don't like to have these records around as evidence to be
picked up by a J. P. or constable or whoever comes in to raid the place.
The Chairman. In what county is Palm Beach or West Palm
Beach?
Mr. Hart. Palm Beach County.
The Chairman. Wlio is the sheriff up there ?
Mr. Hart. John Kirk.
The Chairman. How long has he been the sheriff ?
Mr. Hart. Maybe 3 or 4 years.
The Chairman. This dice game in West Palm Beach is something
anybody can walk in to that wants to play ?
Mr. Hart. I think it was ; yes, sir.
The Chairman. And the Boca Raton operation was something that
anybody out there who wanted to participate could participate in?
Mr. Hart. I have never been there. I don't know a thing about it,
really. I don't know where it was operated.
The Chairman. That is all.
Senator Hunt. Mr. O'Rourke carried on his book operations to a
considerable extent with telephone service, didn't he ?
Mr. Hart. During the times when his front door was locked, he
did some telephone business, and these big transactions with Mickey
Cohen where he lost pretty near everything he had was by telephone.
Senator Hunt. Someone would telephone in a bet and if he hap-
pened to win, Mr. O'Rourke would need to pay him. What process
would he use in paying him? Would he send cash by messenger or
woidd he make him call and collect the bet or write him a check and
mail him his winnings ?
Mr. Hart. Well, most of the checks that are written are to pay
bets from out of town. The local people who bet over the telephone
and win come in the next day and collect.
Senator Hunt. Those checks that went out of town, of course,
would go through his checking account and would go through your
accounting in making up his income tax?
Mr. Hart. That is right.
Senator Hunt. That is all.
The Chairjvian. With regard to these local people who would call
up — say John Jones would call up and want to bet $10 on a certain
horse, would Mr. O'Rourke take the bet when Mr. John Jones would
put his money up, or would it be on credit?
ORGANIZED CRIME IN INTERSTAT'P COMMERCE 65
Mr. Hart. At the moment it would be on credit. If he lost he would
either come and pay, or they would come out to collect. If he won
they usually made him come after it.
The Chairman. Suppose Mr. O'Rourke ^ot a bet of $10,000 or $12,-
000, too big an amount for him, would that be when he would lay some
of it off to some other man?
Mr. Hart. Yes ; either a big bettor or a lot of little bettors whenever
he got more on a particular horse than he could carry.
The Chairman. Who would he lay off to?
Mr. Hart. Sometimes he would lay it off locally.
The Chairman. Mention one name. Mr. Chappell mentioned one
that lived in Miami.
Mr. Halley. Luke Church.
Mr. Hart. He laid off bets to him, and there are others, but I just
don't remember the names.
The Chairman. He lays off with Frank Erickson ?
Mr. Hart. He might.
The CiiAiR]\rAN. He might lay off to Mickey Cohen ?
Mr. Hart. Mickey Cohen's operations might have been lay off;
yes, sir. ' _ ^
The Chairman. That is all.
Mr. H ALLEY. Thank you.
Senator Hunt. I want to ask you a few questions. These checks
are most interesting because of the tremendous amounts involved
and being a one-way street apparently on which Mr. O'Rourke never
won.
Would you be in a position to tell us whether or not Mr. O'Rourke
was made to remit these moneys because of any threats within gang-
land, so-called?
Mr. Hart. I never heard of any such things ; no, sir. He took the
bets and he lost and he paid off. Gamblers have a sort of code of
ethics of their own and they trust one another and if they lose they
pay off.
Mr. Halley. What happens if they don't pay off, if the trust doesn't
work ?
Mr. Hart. I have never known of a local instance where anything
happened where he wasn't paid off. I don't think I know of a bet
where a book didn't pay off. There has been a few colored-town opera-
tions where there were some mysterious shootings reputed to be caused
by bets not being paid off on bolita.
Mr. Halley. Isn't it a fact that you don't live long in the gambling
business if you don't pav off?
Mr. Hart. I presume that is true.
The Chairman. Did Mr. O'Rourke have a policy operation or a
numbers racket or any connection with that ?
Mr. Hart. No, sir.
The Chairman. During any of the times that you kept his records ?
Mr. Hart. No, sir ; not that I know of.
The Chairman. Was it brought out how many telephones he had
in the Boca Raton operation, or do you know ?
Mr. Hart, No, sir ; I don't know.
The Chairman. All right. Is there anything further ?
Mr. Halley. Not of this witness.
The Chairman. Thank you, Mr. Hart.
66 ORGIANIZED CRIME IN INTERSTATE COMMERCE
TESTIMONY OF JOHN F. O'EOURKE, WEST PALM BEACH
Mr. Halley. What is your address, Mr. O'Kourke?
Mr. O'RouRKE. 521 Second Street.
]Mr. Halley. Do you have a x^lace of business ?
Mr. O'RouRKE. I did have.
INIr. Halley. Where was it ?
Mr. O'RouRKE. It was in the Datura Arcade.
The Chairman. This is in West Palm Beach ?
Mr. O'RouRKE. That is right.
The Chairman. Mr. O'Rourke, will you rise and be sworn?
Do you solemnly swear that the testimony you will give tlie com-
mittee will be the truth, the whole truth, and nothing but the truth,
so help you God ?
Mr. O'RouRKE. I do.
Mr. Halley. Wliat business did you have there ?
Mr. O'Rourke. Bookmaking.
Mr. Halley. You said it has been closed ?
Mr. O'Rourke. Yes; but we sneak a lick with a customer once in
a while.
Mr. Halley. You say they cut your wire off ?
Mr. O'Rourke. We lost it.
Mr. Halley. What wire did you have ?
Mr. O'Rourke. I don't know w^iere that wire came from. As far
as I know, it was the one that was leased.
Mr. Halley. Who did you lease it from ?
Mr. O'Rourke. I couldn't tell you the name of tliat company to
save my soul.
Mr. Halley. I think you had better tell us the name of the com-
pany.
Mr. O'Rourke. I will find out and tell you, but I swear I can't give
you the title of it.
Mr. Halley. How long did you have the wire?
Mr. O'Rourke. I guess the wire I had 6, 7, or 8 years.
Mr. Halley. And who cut it off ?
Mr. O'Rourke. I imagine the State did.
Mr. Halley. When you originally got the wire, who did you see;
who did you talk to ?
Mr. O'Rourke. That has been so long ago — I think it changed
hands since then.
Mr. Halley. Wlio did you talk to then ?
Mr. O'Rourke. I just can't remember. I don't remember who it
was. In fact, I can't recall who it was. I think it was in 1932, if I
remember right.
Mr. Halley. Can you give the name of anyone with whom you
dealt in connection with that wire ?
Mr. O'Rourke. Yes ; I can give you a man, a fellow by the name of
Burns.
Mr. Halley. You paid off a man by the name of Burns: is that
right?
Mr. O'Rourke. Yes, sir.
Mr. Halley. What is his full name?
Mr, O'Rourke. Dave.
ORGANIZED CRIME IN INTERSTATE COMMERCE 67
Mr. Halley. David Burns?
Mr. O'KouRKE. Yes, sir.
Mr. Halley. Where does he live ?
Mr. O'RouRKE. I think he lives in Miami.
Mr, Halley. Wliere do you pay him ?
Mr. O'RouRKE. He comes around to the place to collect the money.
IVIr. Halley. He comes to your place of business to collect ?
Mr. O'RouRKE. That is rio;ht.
Mr. Halley. Do you pay him by clieck or in cash ?
JNIr. O'EouRKE. By check.
Mr. Halley. Supposing something goes wrong with the wire, to
whom do you complain ?
Mr. O'RouRKE. I don't handle that, to be frank with you. AVe
don't have any operation witli the wire. As far as that is concerned,
it is more or less comes through — I don't fool with it. I don't com-
plain of operating it or fool with it. I don't know who the man who
operates it calls. I guess he calls some serviceman.
Mv. Halley. Let's quit beating around the bush. Isn't it a fact
tliat you are protecting the people who are furnishing you with the
wire {
Mr. O'RouRKE. I can't answer truthfully because I don't handle
that part of it.
Mr. Halley. You just in your own way, without my trying to ask
a lot of questions tell this committee where you get your wire serv-
ice— from whom and what the arrangements are.
]Mr. O'RouRKE. I told you — Mr. Bui-ns comes around and collects
twice a week and as far as me knowing the title of the company or
who lias the contract or anj^thing about that, I can't tell you truth-
fully because I don't know.
Mr. Halley. Where can you find Mr. Burns in Miami ?
Mr. O'RouRKE. I don't know his address.
]\Ir. Halley. You mean a man whom you don't know where to locate
comes to your place of business twice a week to collect money?
Mr. O'RouRKE. No ; they don't come twice a week. Sometimes once
a month. That is when we were operating ; maybe once ever 2 months,
maybe he comes tAvice a week or twice a month.
Mr. Halley. For whom did Mr. Burns work?
Mv. O'RouRKE. I can't tell you that. I guess he comes from the
people who had the wire.
Mv. Halley. Don't you know that?
Mr. O'RoiKKE. I know you people know the name of it, but I can't
recall. If I did, I would give it to you, honestly.
'' Mr. Halley. Did you ever have a contract for the use of the wire ?
Mr. O'RouRKE. No contract.
Mr, Halley. An oral agreement?
Mr. O'RouRKE. Yes, sir.
^■^ Mr. Halley. Wliat were the terms of the agreement ?
INIr. O'RouRKE. Only so much a week. In the summer we pay $50
a week, and maybe in the winter it M'ent up to $125 a week.
Mr. Halley. Is that the fact; is that your best recollectio.J
Mr. O'RouRKE. In certain months during the summertime, when it
was busy, we paid $75 a week, and it would go up with the season.
Mv. Halley. Who would fix the amount ? Would Mr. Burns come
in and tell you what you were going to pay ?
68 ORGlAISriZED CHIME IN INTERSTAT'E COMMERCE
Mr. O'RouRKE. He would say, "John, we are going to raise the price
now. It is $150," or whatever it was.
Mr. Halley. Did you ever argue about it ?
Mr. O'RouRKE. No, I never did.
Mr. Halley. Did the repair man come from time to time to fix
the wire?
Mr. O'RouRKE. The wire was not directly in the place. Some re-
pairman must have come in — I don't handle that at all.
Mr. Halley. Who handled the wire at your place of operations ?
Mr. O'RouRKE. There isn't any individual that handles it at my
place of operations. If you want me to explain it, I will give you the
whole detail.
Mr. Halley. I would appreciate it.
Mr. O'RouRKE. For the Senators' benefit and for the committee's
benefit, I have nothing to hide on it.
In West Palm Beach, the wire service comes in into a central office,
and we have a broadcasting system that runs out there through a
speaker, just like you run a speaker from this room to over there.
That is the way it is handled.
Mr. Halley. Where is the central office?
Mr. O'Rourke. It doesn't come directly into the place.
Mr. Halley. "Wliere is the central office?
Mr. O'Rourke. Evidently the central office is not there now.
Mr. Halley. Where was it last?
Mr. O'Rourke. Last it was in a room across in the Datura Arcade
from where I am in another room. There were several books run
there that were getting this information and we run the wire speakers
out from there.
Mr. Halley. Where did the service come from? Did it come up
from Miami?
Mr. O'Rourke. I can't swear to that, but I can give you my opinion
if you want it. I can't swear because I don't know. I think it was a
leased wire from one end of the State to the other, but I can't swear
to it. I am just paying them off as a service.
Mr. Halley. What is your present business ?
Mr. O'Rourke. I am not doing anything. I am looking for a job.
Mr. Halley. '^Vlien did you last run a book ?
Mr. O'Rourke. You mean an open place ?
Mr. Halley. Open or closed.
Mr. O'Rourke. I still take a few bets on horses now.
Mr. Halley. In West Palm Beach ?
Mr. O'Rourke. Yes. Any time a friend calls me up and I have
friends who want to bet on a horse.
Mr. Halley. Do you do that by telephone ?
Mr. O'Rourke. Not necessarily. I haven't a telephone in my place.
Mr. Halley. How do you get the business ? You said "any time a
friend calls me up."
Mr. O'Rourke. Calls me at home or anywhere else, or if I see him on
the street or run in to him.
Mr. Halley. Where do you lay off your bets now ?
Mr. O'Rourke. I don't get that much business.
Mr. Halley. You don't lay off at all ?
Mr. O'Rourke. No.
ORGANIZED CMME IN INTERSTATE COMMERCE 69
Mr. Halley. When did you last operate openly ?
Mr. O'RouRKE. I think it was around February a year ago ; around
that time.
Mr. Halley. February of 1949 ?
Mr. O'RouRKE. Yes. Eight after this State administration went in.
I remember it was shortly after that. It was around February. I
am quite sure. It was right after the State administration
Mr. Halley. They shut you down ?
Mr. O'EouRKE. No ; it was a local situation more or less. You know
how local things are.
Mr. Halley. I think the committee would like to know a little more
about how this particular situation worked.
Mr. O'EouRKE. It was just one of those things; everything went
down. We just were — the wire service was closed up.
Mr. Halley. Who did it? The sheriff?
Mr. O'Eourke. The sheriff didn't do it.
Mr. Halley. Who closed up your place ?
Mr. O'Eourke. It was closed up on account of — one part about it
was on account of the grand jury session ; the grand jury investigating.
]VIr. Halley. The grand jury ?
Mr, O'Eourke. Yes ; they are still hot now.
Mr. Halley. Wlio runs the grand jury ? Is there a district attorney ?
Mr. O'Eourke. State's attorney.
Mr. Halley. For the county ?
Mr. O'Eourke. Yes.
]\Ir. Halley. And when they started, everybody stopped open oper-
ations ?
Mr. O'Eourkje. Yes. We operate at the discretion of the people.
j\Ir. Halley. Was anybody arrested?
Mr. O'Eourke. I was.
Mr. Hatjle. Were you convicted ?
Mr, O'Eourke. No.
Mr. Halley. Was anybody else arrested?
Mr. O'Eourke. No.
Mr, Halley. What happened to your case ?
Mr. O'Eourke, It was a funny situation. It is on record, I hap-
pended to be attacked by the flying squad.
Mr, Halley, Wlio are the "flying squad"?
Mr. O'Eourke. The beverage department.
Mr. Haley, Is that the State beverage department?
Mr. O'Eourke. Yes, sir.
Mr. Halley. What would they be doing in a gambling place? Were
you also selling liquor?
Mr, O'Eourke, No, In fact, we were practically closed at that time
when they came in, but they had a little stand in there that sold beer,
and that carries a liquor license. Just bottled beer.
Mr, Halley, You were arrested for selling beer?
Mr, O'Eourke. That is to give them the privilege of coming in,
Mr. Halley^ Then you were arrested for making a book; is that
right ?
JNIr, O'Eourke, Yes,
Mr. Halley. Is that case still pending?
Mr. O'Eourke. No. That case was thrown out on account of a search
warrant.
70 ORGAAnZED CRIME IN m'TERSTATE COJVEVIERCE
Mr. Hallet. What judge?
Mr. O'RouRKE. Justice of the peace.
Mr. Halley. What is his name?
Mr. O'RouKE. Harper.
Mr. Halley. Do you know his full name ?
Mr. O'RouRKE. No. They call him "Sleepy."
Mv. Halley. "Sleepy'' Harper?
Mv. O'RouRKE. Yes.
Mr. Halley. In West Palm Beach ?
I^Ir. O'RouRKE. Yes, sir. He ran for the legislature at that time.
Mr. Halley. Let's go back to the good old days in 1948. You were
operating wide open then ; were you not.
Mv. O'RouRKE. That is right.
Mr. Halley. Nobody arrested you?
Mr. O'RoLRKE. No. ^
Mr. Halley. You had no trouble then ?
Mr. O'RouRKE'. No. I don't know of any at that time.
Mr. Halley. Wliat business were you operating in 1948 ?
Mr, O'RouRKE. In what way do you mean?
Mr. Halley. You had certain gambling operations in 1948. Would
you specify what they were ?
Mr. O'RouRKE. I was running a book, and I had a night crap, game
I'unning, too.
Mr. Halley. Both in West Palm Beach?
Mv. O'Rourke. Yes, sir.
Mr. Halley. Any other operations?
Mr. O'RoLTRKE. Well, if you call agents out in a hotel which I
included in the book
Mr. Halley. Would you specify what those agencies were?
Mr. O'Rourke. Only one, in the Boca Raton Club.
]Mr. Halley. Any others?
Mr. O'Rourke. No ; not as I can recall now.
Mr. Halley. The Roney Plaza ?
Mr. O'Rourke. No, sir.
Mr. Halley. No other hotels?
Mr. O'Rourke. No.
Mr. Halley. How did you happen to go into the Boca Raton?
Mr. O'Rourke. Well, it is a funny story there. It seems that most
of the hotels were having books in them and the management wanted
to put in a book down there.
ISIr. Halley. Do you mean Mr. Schine ?
Mr. O'Rourke. Yes, sir. And for entertainment of customers, and
it was kind of isolated, and I went down and talked to him.
Mr. Halley. How did you jfind out that the management wanted
to put a book in ?
^Ir. O'Rourke. He contacted me.
Mr. Halley. Mr. Schine contacted you ?
Mr. O'Rourke. Yes.
Mr. Halli:y. Did he phone you ?
Mr. O'Rourke. Yes.
Mr. Halley. Mr. Schine personally telephoned you?
Mr. O'Rourke. I can't swear to that, but he had someone in his
hotel, the manager or someone like that.
ORGANIZED CRIME IN INTERSTATE COMMERCE 71
Mr. Halley. You are talking about Mr. Scliine Sr. ?
Mr. O'RouRKE. Yes, sir; Morris.
Mr. Halley. And you went down to see liini at the Boca Raton?
Mr. O'RouRKE. That is right.
Mr. Halley. What was the conversation? What year was this?
Mr. O'RouRKE. 1947, I think it was. I was there 2 years.
Mr. Halley. Started in the fall of
Mr. O'RouRKE. The first year — what year was it that — this is 1950 —
1949— it was 1947 or 1948.
Mr. Halley. You saw him at the hotel ?
Mr. O'RouRKE. Yes,
Mr. Halley. That would be in the fall of 1947?
Mr. O'RouRKE. That would have been, if I would recollect, before
the Christmas holidays.
Mr. Halley. Would you tell the committee what he said to you
and what you said to him?
Mr. O'RouRKE. The conversation, the best I can recollect, would be
like this: Boca Raton had quite a reservation list and it was iso-
lated— nothing but cabanas and a golf course — and he figured if I
could or would entertain the idea he would like to have someone run
a book there for his customers in the afternoon.
Mr. Halley. Did you discuss terms and rents to be paid to the
hotel?
Mr. O'Rourke. He discussed them more frequently than I did.
Mr. Halley. Did he get a cut of the profits {
Mr. O'RouKKE. No, sir; he didn't. He was cold-blooded. I tried
to make him that proposition, but I didn't get it.
Mr. Halley. Didn't he want to take a cut i
Mr. O'RouRKE. No, sir.
Mr. Halley. What did he get?
Mr. O'Rourke. a straight fee.
Mr. Halley. How much ?
Mr. O'RoURKE. I can't recollect that. The checks will show that
because it was a pretty good amount.
Mr. Halley. How did jNIr. Frank Erickson get into that deal, too?
Mr. OTvouRKE. I will tell you how that was, too: In talking to
Mr. Schine, he said — in fact, the deal was too much for me to handle
for the price tliat he asked, and I said, "I just can't go for it because
I am not that kind of man," and he said, "I w^ould like to do it," and
I said, 'T would like to, but I can't consider it," and I never met Mr.
Erickson and didn't know of him. I knew of him by reputation, and
he said, "Maybe you can work it around to where it won^t be so tough
on you," so he gave me Mr. Erickson — where Mr. Erickson was, and
I don't know if he made an appointment or if I made an appointment.
He was stopping in Miami at the Roney Plaza Hotel, and I said that
I would go down and talk to him. So, I went down and talked to him
and he said, "John, if you want to take a gamble on it, I will go with
you." That was practically the substance of the conversation.
Mr. Halley. You were in as 50-50 partners ?
Mr. O'Rourke. That is right, because up there there were some
customers that I couldn't have handled anyway and that was the
whole situation. If we weren't 50-50 partners, I wouldn't hardly go
in, because I couldn't takp. the situation at that price we were paying,
68958— SO—pt. 1^—6
72 ORGAJSnZED CRIME IN INTERSTATE COMMERCE
and he said, "Maybe we will make some money and maybe not; but if
you are willing, I will go into it with you."
Senator Hunt. Do you remember what the price was? What was
the office cost per month ?
Mr. O'RouRKE. This was on a season basis.
Senator Hunt. Would it be $100 or $1,000 a month %
Mr. O'RouRKE. Not per month. If I remember right, it was right
around— I don't know— $27- or $25- or around $20,000.
Senator Hunt. $20,000 for the season ?
Mr. O'RouRKE. $20,000 for the full season.
Senator Hunt. And you made the check to Mr. Schine ?
Mr. O'RouRKE. To the Boca Raton Club.
Mr. Halley. In your bookmaking business, did you lay off your bets
with anyone ?
Mr. O'RouRKE. Very seldom. Sometimes I received bets from
them, but I always ran my business this way and tried not to take any
more than I could handle myself, but sometimes I would make per-
sonal bets myself — if you call that laying off; and again, if you have
a friend that maybe wants to bet a little money and you didn't want
to hold it or maybe I want to bet on his horse or make a bet, too.
Mr. Halley. Who would you lay off to ?
Mr. O'RouRKE. Mostly around town; the local boys around town.
Mr. Halley. Could you name the people ?
Mr. O'RouRKE. Mr. Risdon, Mr. McRichie.
Mr. Halley. What are their full names ?
Mr. O'RouRKE. Joe Risdon.
Mr. Halley. In Miami or West Palm Beach ?
The Chairman. Wliat about Tracy ?
Mr. O'RouRKE. Matty?
Mr. Halley. Also West Palm Beach?
Mr. O'Rourke. Matthew J. Tracy. He is from West Palm Beach.
Mr. Halley. Did you ever lay off with Luke Church in Miami ?
Mr. O'Rourke. Not directly to him.
Mr. Halley. How would that come about ?
Mr. O'Rourke. That would go to a fellow, but not very much lay
off, either. At one time I did, too. It was through Dick Evans.
Mr. Halley. You mean througii Dick Evans you laid off to Luke
Church?
Mr. O'Rourke. No. I think, if I remember right, it may be that
Luke Church was working for Dick Evans. They had some con-
nection ; but, so far as Luke Church was concerned, I wouldn't know
him if he walked into tlie room, but I knew Dick very, very well.
Mr. Halley. Wliere is Evans ?
Mr. O'Rourke. He is dead now.
Mr. Halley. Where was he?
Mr. O'Rourke. He was in Miami.
Mr. Halley. Did you ever lay off with Erickson ?
Mr. O'Rourke. Never did any business with Erickson. Never,
made an out-of-town bet with Erickson in mv life. The only trans-
action with Erickson was with the Boca Ratoii Club.
Mr. Halley. On the Boca Raton Chib you actuallv ran the book?
Mr. ORouRKE. No; he had a man there".
ORGANIZED CEIIME IN INtTERSTATE COMMERCE 73
Mr. Halley. He had a man there?
Mr. O'RouRKE. Yes.
Mr. Halley. Did you have a man there or were you there yourself ?
Mr. O'RouRKE. I don't think I made two trips down there the whole
season.
Mr. Halley. Did you have a man there ?
Mr. O'RouRKE. Yes.
Mr. Halley. How many men did you have there?
Mr. O'RouRKE. We hired some fellows around the club. We had
some cabana boys and a locker-room boy.
Mr. Halley. Who did Erickson have there ?
Mr. O'RouRKE. Erickson had a man by the name of Steve Mauro,
I think his name was.
Mr. Halley. How do you spell Mauro ?
Mr. O'RouRKE. I think he was Italian — M-a-u-r-o.
Mr. Halley. Did you do any business with Mickey Cohen?
Mr. O'Roukke. Yes, sir.
Mr. Halley. Would you describe the circumstances?
Mr. O'RouRKE. I hate to tell you because it was disastrous, but I
will tell you what happened. Mickey called me — this was before he
got a lot of publicity — I think the records show, he called me and said,
"Do you want to take some business ?"
I said, "Who in hell are you ?"
He said, "Mickey Cohen from Los Angeles."
He asked if he could bet on some California horses and I said, "No,
only Florida," and he said, "All right," and I said, "I will have to
investigate you."
I did, and the only thing I was interested in finding out was finding
out if his credit was fairly good and if it was reliable.
Mr. Halley. Had vou lieard of him before ?
Mr. O'RouRKE. No"; I hadn't.
Mr. Halley. You never heard of him ?
Mr. O'RouRKE. Never.
Mr. Halley. He called you out of a clear blue sky with no intro-
duction ?
Mr. O'Rourke. Yes ; out of a clear blue sky.
Mr. Halley. Did you ask him how he had heard of you ?
Mr. O'RouRKE. I didn't ask him that.
Mr. Halley. How did he know you were operating in West Palm
Beach ?
Mr. O'RouRKE. I don't know how, but news gets around pretty fast.
Mr. Halley. What was the news that got to Los Angeles about
you ?
Mr. O'RouRKE. I don't know how he got it there.
Mr. Halley. Did it strike you as funny as it strikes me ?
Mr. O'Rourke. It strikes me as funny as it does you, but it hap-
pened that I have some relatives in California and I called them up.
Mr. Halley. Did they recommend him ?
Mr. O'Rourke. No ; they didn't recommend him. He has got a little
reputation, but he has a reputation of paying. I said, "That is all
that is necessary for me, I will take a shot at him, and I will see if he
is hot or if he is cold."
Several days later he called me and said, "If you want some busi-
ness I can give you some business. I want to bet on some California
horses."
74 ORCANIZED CRIME IN INTERSTATE COMMERCE
T said, "I don't go for any California horses. It is too damned
close to the race track for me."
He said, "I will give yon some eastern horses," and I said, "All
right," and we did business, and if I remember right, we would settle
on maybe if I owed him $5,000 or if he owned me $5,000, we would
settle on tliat basis. I never did catch him.
Mr. Halley. Did you place any bets with him ?
]\Ir. O'RouRKE. Only personal bets ; maybe some times. I remember
one day he hit me a pretty good lick, and I grabbed the racing form
and tried to pick me one to get even. That was all I did. I was trying
to get out.
Mr. Halley. How^ much monev did you bet with Mickey Cohen ?
Mr. O'RouRKE. I don't think I bet $1,500. I don't think I really
bet that much with him on my bets with him.
Mr. Halley, On one occasion or all together ?
]Mr. O'RouRKE. I think maybe one afternoon I might have either —
no, that was different $100- and $200-bets. If I remember right, I gave
liim very few bets.
Mr. Halley. Was he betting his own money, or laying off to you ?
Mr. O'RouRKE. That I couldn't say, but from our conversation, I
imagine he was doing a little betting himself.
Mr. Halley. Did he pick a great many winners ?
Mr. O'RouRKE. The checks will show he did. I know I cut him
off pretty damned quick.
Mr. Halley. You cut him off ?
Mr. O'Rourke. Yes, sir.
Mr. Halley. You ran almost a year with him, didn't you (
Mr. O'EouRKE. No ; I don't think so.
Mr. Halley. I have the checks here starting in October of lO-tT and
running through November 1948.
Mr. O'RouRKE. Well, that may be true, but some of that business
was some money that I owed him and stood him off until I could
pay him.
^Ir. Halley. On November 27, 1948, there are two $2,500 checks.
Mr. O'RouRKE. Yes, sir.
Mr. Halley. Is that money you had owed him ?
IMr. O'Rourke. Yes, sir.
Mr. Halley. How long can you get along owing money to Mickey
Cohen ?
Mr. O'Rourke. I don't know.
Mr. Halley. How had you owed it to him ? One of these checks is
November 1 and the other one is November 15.
Mr. O'RouRKE. That is right.
]Mr. Halley. Was that paying a single item for $5,000?
Mr. O'RouRKE. That is right.
Mr. Halley. In June of 1948 you paid him $5,000. That you didn't
owe him ^
Mr. O'RoURKE. I think that was some of the balance due. We
miglit have done business for 6 or 7 or 8 months.
Mr. Halley. Right at the start he w^on a good deal of money from
you in 1947?
Mr. O'RouRKE. That is right.
JMr. Halley. And you kept on doing business?
ORGANIZED CRIME IN INTERSTATE COMMERCE 75
:\rr. O'RouRKE. No ; I cut liim down. I was trying to get my money
back. Instead of taking maybe $400 or $500 on a horse, I would take
$100 or something like that.
Mr. Hali.ey. These checks are for rather large sums of money. Do
they represent the accumulation of a considerable number of bets?
Mr. O'RouRKE. Yes,
Mr. Halley. They weren't big bets of $10,000?
Mr. O'RouRKE. Nothing like that. I don't think his top bet would
be over $300 or $400 ; maybe on an even money shot or a 2 to 1 shot 1
would handle $500.
Mr. Halley. He would lose some of them. He never w^on them
all, did he?
Mr. O'Rourke. Sure, he'd lose some. I have had him hooked be-
fore and he sent me a check.
Mr. Halley. Who kept the arithmetic on all of these $100 bets
back and forth ?
Mr. O'Rourke. We would make a sheet on it and send it out.
Mr. Halley. Where are those sheets now?
Mr. O'Rourke. I don't know. They are destroyed.
Mr. Halley. Who destroyed them ?
Mr. O'Rourke. After that raid and all of that up there, I think a
lot of it dissipated.
Mr. Halley. Did you keep them until the raid?
Mr. O'Rourke. No; I don't think so. After I settled up on the
amounts and stuff and made the checks out, I don't think I kept any
of those records. It w^as made on a slip like that [indicating].
Mr. Halley. Before you sent him a check, would you call him up
and say. "Look here. This is what I owe you" ?
Mr. O'Rourke. He always called me.
Mr. Halley. He would keep a record and you would keep a record ?
Mr. O'Rourke. That is right.
JNIr. Halley. And then there would be a phone call ?
Mr. O'Rourke. He would call me. If we bet today, tomorrow
mornino- or tomorrow afternoon he would call to see if we checked.
Mr. Halley. Did you balance your credits and your standing
practically every day l3y telephone ? He would be calling every day ?
Mr. O'Rourke. That is right.
Mr. Halley. Each day you compared ?
Mr. O'Rourke. Yes. We would put the balance at the top and
start another day.
Mr. Halley. And you ripped up those sheets ?
Mr. O'Rourke. Yes. We didn't keep them.
Mr. Halley. You did a lot of business in 1948, didn't you? You
handled a lot of money ?
Mr. O'Rourke. I guess I did.
Mr. Halley. Almost over $750,000 at the Boca Raton place alone?
Mr. O'Rourke. I don't know the exact figure there.
Mr. Halley. Well, there was a lot of money.
Mr. O'ROURKE. They made some good business. I think they did
handle some business there.
Mr. Halley. Some very substantial business ?
Mr. O'Rourke. Yes, sir.
76 ORGAN^IZED CKIME IN mTERSTATE COMMERCE
Mr. Halley. And the records show it to be over $750,000 in a 3-
month season. You wouldn't be surprised if the records showed that,
would you ?
Mr. O'RouRKE. No ; I don't think so. I don't know if it was or not.
Mr. Halley. Do you know whether it sounds reasonable to you?
Suppose I told you that between January and April, a period of
just 3 months, there were gross receipts of at least$ 750,000. Would
that surprise you ?
Mr. O'RouRKE. It might at that. The only thing I was keeping was
the winning and losing account.
Mr. Halley. What would you do ? Were you the operator or did
Frank Erickson come in and check up there on the people who were
there each day ?
Mr. O'RouRKE. Frank had his man and he would check each day.
Mr. Halley. You have to watch people pretty carefully to see
that they don't put their friends in on some bets after the race is over,
don't you ?
Mr. O'RoTJRKE. I don't think men of his type would do that.
Mr. Halley. Men of whose type ?
Mr. O'RouKKE. Erickson. He is a legitimate bookmaker.
Mr. Halley. Do you consider Erickson a legitimate bookmaker?
Mr. O'RouRKE. He is an honest man.
Mr. Halley. How you mean "legitimate" ? You don't mean that he
operates within the law, do you ?
Mr. O'RouRKE. I don't think he would take advantage of me or you
or anybody else in the business and do an underhanded trick like that.
Mr. Halley. I was talking about something else. You have em-
ployees operating at the hotel ?
Mr. O'RouRKE. Yes.
JNIr. Halley. And they were taking bets ?
Mr. O'RouRKE. Yes.
Mr. Halley. And paying off for you ?
Mr. O'Rourke. Yes.
Mr. Halley. You are not there every minute yourself, are you ?
Mr. O'Rourke. I was not there at all.
Mr. Halley. Never?
Mr. O'Rourke, No. Maybe once or twice during the whole season,
but I never did go around the place.
Mr. Halley. Who actually operated it?
Mr. O'Rourke. Mauro. Mauro was running it.
Mr. Halley. And your part was just furnishing half the capital?
Mr. O'Rourke. Well, when we started off, there was not much
financing to do.
Mr. Halley. For what reason did Erickson need you?
Mr. O'Rourke. No particular reason. I was around in Boca Raton,
and I was taking bets around the locker house and stuff like that —
small bets— and then Schine approached me. That was when I turned
the proposition down because it looked like it was too much for me
to handle and then the subject of Erickson came up.
Mr. HATJ.EY. From Schine?
Mr. O'Rourke. That is right.
Mr. Halley. Then Mr. Schine provided half the capital?
Mr. O'Rourke. Schine didn't.
ORGANIZED CHIME IN INTERSTATE COMMERCE 77
Mr. H ALLEY. I mean Erickson.
Mr. O'RouRKE. Erickson would stand good for it.
Mr. Halley. Did you get reports each day of the operations, or
each week ?
Mr. O'RoTJRKE. Only win and lose.
Mr. Halley. Each day?
Mr. O'Rourke. That is right.
Mr. Halley. What did you do with them ?
Mr. O'Rourke. I would mark it down and keep a record of it. Like
maybe a fellow would bring you a check to pay a bet, or I would get
a check for $8,000 or $9,000 and I deposited it in my account.
Mr. Halley. Who kept the records for that ?
Mr. O'Rourke. Mauro did.
Mr. Halley. Who kept the bank roll for it ?
Mr. O'Rourke, Mauro.
Mr. Halley. Who kept the bank account for it ? The commercial
bank?
Mr. O'Rourke. No. Only the checks that came in, I deposited them.
Mr. Halley. You would put in all the checks that were brought to
you from Boca Raton ?
]Mr. O'Rourke, That is right, in my account.
Mr. Halley. Mauro would bring them to you ?
Mv. O'Rourke. That is right. I would put them through the bank
roll to pay off. Then I would write a check and put it in.
Mr. Halley. Wliat accounts are you referring to?
Mr. O'Rourke. Personal account.
Mr. Halley. At the Atlantic National Bank ?
l\h\ O'Rourke. My bank account; my account.
]Mr. Halley. Was there a lot of cash bet at Boca Raton ?
Mr. O'Rourke. Considerable.
Mr. Halley. So that most of the betting at Boca Raton was by
check ?
Mr. O'Rourke. Most of it was by check.
Mr. Halley. Was the pay-off in cash or by check?
Mr, O'Rourke. Sometimes I wrote a check. Maybe some people
I would give cash, or do it on exchange, like people win today and lose
tomorrow, or sometimes you carry a man on account until he check
out — stuff like that, and at the end of the day maybe he would be win-
ners, but he didn't get the money, but the guest is still there, and
maybe he would lose $500 today or tomorrow, and that would go as
winnings to me. At the end of the season, when he checked out after
a 2 weeks' stay, he may owe me or I may owe him, and whenever that
check came in, I deposited it.
Mr. Halley. These checks went into your account ?
Mr. O'Rourke. That is right.
Mr. Halley. What work did Mauro have to do ?
Mr. O'Rourke, He kept the winnings and losings.
Mr. Halley. Each day?
Mr. O'Rourke. Yes.
Mr. Halley. What did he do with the winnings and losings?
Mr, O'Rourke. Checks or anything he turned over to me for de-
posit.
Mr. Halley. What did he do with those that he would get each day ?
78 ORG'AXIZED CRIME IN mTERSTATE COMMERCE
Mr. O'RouRKE. I don't know. He gave me a report at the end, which
I mailed to New York.
Mr. Halley. Who made the income tax return for the operation at
Boca Raton ?
Mr. O'RouRKE. For who ?
Mr. Halley. The partnership.
Mr. O'RouKKE. I didn't make any partnership return.
Mr. Halley. The partnership return was made by Erickson's
accountant ^
Mr. O'RouRKE. That is right, Later. I didn't know they were going
to make a partnership return.
Mr. Halley. Wliere did Erickson's accountant get the figures ?
Mr. O'RouRKE. From Mauro, I guess.
Mr. Halley. And he showed a certain amount of profit and a cer-
tain amount of loss in that partnership return ?
Mr. O'RouRKE. That is right.
Mr. Halley. Wlien did you get your share of the profits ? How did
that work ?
Mr. O'RouRKE. The first year, I believe, I owed them the difference
between the deposits of the checks, if I remember correctly — the checks
that I deposited in the bank — the difference between that — Erickson
had some coming and I think I gave him a check for that.
Mr. Halley. I am completely lost in this accounting. I don't even
begin to see how you did it. Let's try to work it out.
Let's say here is a Boca Raton man comes in and bets $1,000.
Mr. O'RouRKE. Yes, sir ; for the day ?
Mr. Halley. Yes, and at the end of the day he is loser by $900.
Mr. O'Rourke. Yes.
Mr. Halley. He settles up at the end of the day ; is that right ?
Mr. O'Rourke. Not necessarily.
Mr. Halley. What happens to the $900 that the customer owes at
the end of January — say January 4, 1948?
Mr. O'Rourke. January 4, 1948, if I remember, they carried this
this way, to the best of my recollection : you said that they paid that
that day?
Mr. Halley. Yes.
Mr. O'Rourke. You say he lost $900. That Avould have been turned
in as a winner for $900, because you have to take it as a winner that
day. But the man doesn't pay but he owes you $900 and it is an
account you carry from day to day. Now, at the end of his time
there, or at the end of the season he may win or lose — win two or three
times.
The difference between his winnings and losses, if he wants to settle
his account — it would probably be either a check or cash to him, or
check, whichever he wanted. But this winner is going down, and tliey
balance — from day to day.
Mr. Halley. That is pretty complicated bookkeeping.
Mr. O'Rourke. No, sir. It is a record between winnings and losses.
Mr. Halley. That is a lot of figures that you have to keep.
Mr. O'RoiRKE. No.
Mr. Halley. You have his winnings and losses; is that right?
Mr. O'Rourke. Say today he owes you $900 and tomorrow he owes
you $400 — that is $1,300 he owes you.
ORGANIZED CRIME IN INTERSTATE COMMERCE 79
Mr. Halite Y. And then if the customer wins the next day $900 or
$1,000 he owes you only $300.
Mr. O'RouKKE. We have to win some days. Then this brings it
back to $900, so you lose $900, and if he wants cash I give him cash,
or a check.
Mr. Haeley. What happens if I give you a check?
Mr. O'RouRKE. Giveg me a check ?
Mr. Halley. If I gave a check to Mauro who was running the game
on the premises, what would he do with the check ?
Mr. O'RouRivE. Give it to me.
i\Ir. Halley. Invariably ?
Mr. O'RouRKE. That is right.
Mr. Halley. And it would go into your account in the Atlantic
National Bank ?
Mr. O'RouEKE. That is right.
Mv. Halley. Suppose Mauro got cash instead of a check?
Mr. O'Rourke. It would go in the bank roll.
Mr. Halley. Would he give you a statement of what was in the
bank roll at the end of each day ?
Mr. O'Rourke. Not winners and losers. I would know exactly how
much is there because the checks he gives me — if I can explain it. For
example, say he gives me $5,200 worth of checks. I deposit those.
Then I have up here the winners and losers, say $500. All right.
That is the winners and losers. Maybe here he is giving me more
checks over here, so I owe him money. At the end of the season there
will be a balance here, which means I deposited more checks in my
account than I had coming.
Mr. Halley. As your share of the cut ?
]\Ir. O'Rourke. If I remember right, I give him a check for the
difference.
Mr. Halley. How much of a check did you give Mr. Erickson ?
Mr. O'Rourke. I don't remember. I think it was around $3,000
or $4,000.
Mr. Halley. Do your deposit slips show which deposits came from
the crap game and which came from the book and which came from
Boca Raton ?
Mr. O'Rourke. No, sir.
Mr. Halley. It is all together in one big unidentifiable group ?
Mr. O'Rourke. That is right. It is all run in together.
Mr. Halley. On the cash side of it, there is no record whatsoever
to show where the cash came from ?
Mr. O'RoiTRKE. On what?
Mr. Halley. Where you take your wins and losses and put them
into your bank roll, there is no record to show that the cash came
from any particular transaction or not, is there ? It is simply a bank
roll which is large or small.
Mr. O'Rourke. No, sir. All that was deposited was checks.
Mr. Halley. And there is no way in the world that anybody could
check up to find out whether the figure is right or wrong?
Mr. O'Rourke. No ; I don't know that he could or not. In the book
we cash a lot of local checks — payroll checks and stuff like that as an
accommodation, and especially on Saturdays maybe a fellow, after
banking hours, has to leave town and has to have some money for a
80. ORGANIZED CRIME IX LS'TERSTAT'E COMMERCE
ticket and stuff like that. As an accommodation we had a check-
cashing proposition. Other times we have a lot more checks to cash
and you have to refurnish the bank roll.
Mr. Halley. Do you have a safe-deposit box?
Mr. O'RouRKE. Yes, sir.
Mr. Halley. In what bank?
Mr. O'RouRKE. In the Atlantic National Bank.
Mr. Halley. Any other box?
Mr. O'RouRKE. No, sir.
Mr. Halley. One box in the Atlantic National Bank ?
Mr. O'Rourke. Yes, sir.
Mr. Halley. Do you own any real estate?
Mr. O'Rourke. I own ni}-^ house.
Mr. Halley. Where is the house ?
Mr. O'Rourke. 521 Twenty-eighth Street.
Mr. Halley. Do you own any other businesses ?
Mr. O'Rourke. No.
Mr. Halley. Or property?
Mr. O'Rourke. No. I am buying a little piece of property on a
contract — a mango grove, and I pay $225 every quarter.
Mr. Halley. What is the total cost of the mango grove ?
Mr. O'Rourke. I think around $4,000 or $5,000.
Mr. Halley. In 1948, your own records show, you banked approxi-
mately $500,000, and that your total income for the year was only
something like $1,700.
Mr. O'Rourke. That is the year I took that beating.
Mr. Halley. Is that the year you took the beating from Mickey
Cohen ?
Mr. O'Rourke. Yes, and I think I mortgaged my stocks and bonds
and everything else.
Mr. Halley. Is that how you account for the sad situation in 1948 ?
Mr. O'Rourke. Yes, sir.
Mr. Halley. What was your net income in 1947 ?
Mr. O'Rourke. I don't know. You must have it there.
Mr. Halley. Did you have any very unusual losses in 1947, or was
that a normal year ?
Mr. O'Rourke. 1947?
Mr. Halley. Yes.
Mr. O'Rourke. I don't know. I think I had some fairly good
losses in there, too ; whatever the checks would show there. On those
bank deposits, we cashed a lot of checks, naturally, and people there
would even send up payrolls to cash. We did a lot of cashing of
checks, so that runs your deposits up quite a bit.
Mr. Halley. I don't understand. Do you mean that your bank
deposits in the Atlantic National Bank reflect other than your income
from your business?
Mr. O'Rourke. Those deposits are not all income.
Mr. Halley. Then you must have lost. I think perhaps the Gov-
ernment owes you a lot of money, then, because by your bank deposits
apparently considering them all as income, your accountant arrived
at a gross income figure. Is it your position that this gross income
figure is wrong ?
Mr. O'Rourke. No.
ORGANIZED CRIME IN INTERSTATE C'OMMERCj: 81
Mr. Hali.ey. You say you have cashed a lot of checks. How many
checks would you cash in a week, on the average?
Mr. O'RotTEKE. I have no way of estimating,
Mr. Halley. a thousand ?
Mr. O'RouRKE. Maybe more than that.
Mr. Halley. Two thousand ?
Mr. O'RouRKE. Maybe more than that.
Mr. Halley. So that if your total deposits were $552,000, would
you say that it is conceivable that as much as $100,000 might repre-
sent simj^ly checks cashed as an accommodation ?
Mr. O'RouRKE. I couldn't tell you the truth what it might be.
Mr. Halley. Make an estimate, please.
Mr. O'RouRKE. I don't know.
Mr. Halley. $50,000?
Mr. O'KouRKE. I don't know exactly. If a man would come to me
and say, "John, cash me a $100 check. I have to catch a plane," or
maybe he couldn't get to the bank, or maybe they would send a nigger
up with a bunch of payroll checks because the banks are all closed. I
would cash them for him. That is an accommodation.
The Chairman. The question is: Are those checks listed?
Mr. O'RouRKE. Yes, sir. They are all in there.
Mr. Halley. Would vou say in a single year they would total at
least $10,000?
Mr. O'RouRKE. They would run much more than that.
Mr. Halley. At least $50,000 ?
Mr. O'RouRKE. I imagine more than that.
Mr. Halley. $100,000?
Mr. O'RouRKE. I can't estimate that.
Mr. Halley. They run at least $50,000 ?
Mr. O'RouRKE. I imagine they would.
Mr. Halley. In any given year when you were operating; is that
right?
Mr. O'RouRKE. Yes, sir.
Mr. Halley. And $50,000 would be a low figure rather than a high
figure ?
Mr. O'RouRKE. I don't know that. That is just
The Chairman. Those are checks that had nothing to do with bet-
ting?
jNIr. O'RouRKE. That is right. Of course it doesn't mean they were
all accommodation propositions. Senator, but there were a lot of
them that way. There were very few checks I would take on bets,
unless it was from out of town and most all of them were personal
checks ; people I know around town there.
Mr. Halley. Would you have for your crap game and your
Mr. O'RouRKE. I cashed for a lot of people checks — unemployment
checks from the Government, that they didn't have bank accounts,
and some of the banks would charge them 25 cents and things like
that. If you know them, you cash it for them.
Mr. Halley. Did you charge for cashing checks ?
Mr. O'RouRKE. No.
Mr. Halley. Even payroll checks ?
Mr. O'RouRKE. No.
Mr. Halley. No charge ever ?
Mr. O'Rourke. No, sir.
82 ORGAJSriZED CRIME IN INTERSTAT'E CO]\IMERCE
Mr. Halley. You have a bank roll, do you not, when you operate
your games ?
Mr. O'RouKKE. Yes.
Mr. Halley. Do you make it a practice of keeping a certain amount
of money in the bank roll ?
Mr. O'RouRKE. We try to keep it around $5,000. It varies from
$2,500 up to $7,500, and with the action back and forth, checks would
go back and forth.
Mr. Halley. When the bankroll went down, you would draw checks
from the bank?
Mr. O'Rourke. That is right.
Mr. Halley. Cash a check and take the cash and use that for your
bankroll ?
Mr. O'Rourke. Yes, sir.
Mr. Halley. And what record did you keep of the use to which
you put the cash withdrawn from the bank and put in the bankroll?
Do you keep a book showing disbursements out of the bankroll ?
Mr. O'Rourke. No disbursements outside of the bets would be made
by the bankroll.
Mr. Halley. You kept betting sheets ?
Mr. O'Rourke. No; just a ticket; just a pad like that — maybe 2 or
3 inches wide and maybe 4 inches long.
Mr. Halley. What did you do with those sheets after you paid the
bettor or took his money?
Mr. O'Rourke. We kept them in the cashier's, in a drawer with the
winners and losers.
Mr. Halley. Where is the sheet now ?
Mr. O'Rourke. I don't know.
Mr. Halley. What happened to them?
Mr. O'Rourke. Destroyed them.
Mr. Halley. Did you destroy them?
Mr. O'Rourke. They were put out a long time ago. All I kept up
there one time — I kept those sheets for 6 or 7 years and it was in the
old post office. I had a truckloacl of them. I kept them up because they
are not in any form. They are not tied together. They are plain
pieces of paper w^ith a rubber band around them, and when we changed
location, nobody ever came in to look around or anything so I just
told the boys to carry them out and throw them in the incinerator
because there was a stack as high as from here to there.
Mr. Halley. You have none any more?
Mr. O'Rourke. Not any more.
Mr. Halley. Wlien you had your accountant work up your figures
for each year, did you give him those sheets for the year ?
Mr. O'Rourke. No.
Mr. Halley. Why not?
Mr. O'Rourke. He didn't ask for them.
Mr. Halley. Did you tell him there were such sheets ?
Mr. O'Rourke. I was always told to deposit all checks I received;
don't cash any checks for cash ; put them all in and if I needed to re-
plenish the bankroll, take it.
Mr. Halley. You didn't deposit the cash you received?
Mr. O'Rourke. Tlie cash? I think those checks the cashier cashed.
Mr. Halley. When you would win a cash bet. that cash went into
the cash bankroll ?
ORGAXIZED CR'IME IN INTERSTATE COMMERCE 83
Mr. O'RouRKE. That is right.
Mr. Hallp:y. And it was not deposited in the bank?
Mr. ORouRKE. No ; these checks were all cashed.
Mr. Hallf.y. You kept no cash book showing receipts of cash ?
Mr. O'RouRKE. No.
Mr. Halley. I have no further questions.
The Chairman. I have one or two questions. Do you want to ask
some now. Senator Hunt?
Senator Hunt. No, sir.
The Chairman. Mr. O'Rourke, this Mr. Schine that you talked to,
is he the one that owns the McAllister Hotel here in Miami ?
Mr. O'Rourke. I don't know if he owns the McAllister. I under-
stand he owns the Roney.
The Chairman. How long had you known Mr. Schine when he
called you to come to see him?
Mr. O'RouRKE. I had never met him.
The Chairman. Did you ever meet Mickey Cohen ?
Mr. O'RouRKE. Never seen him in my life.
The Chairman. What was your first transaction with Mickey
Cohen ?
Mr. O'RouRKE. How it came about?
The Chairman. Yes.
Mr. O'RouRKE. Just repeating, he called me one day on the phone
and asked me if I wanted some business, and I told him I would never
turn down any business.
The Chairman. Do you know how he got your name ?
Mr. O'RouRKE. No ; I can't tell you that.
The Chairman. Assuming that Mickey Cohen would call and want
to place a bet, how long would that be before the race would take
place?
Mr. O'RouRKE. Probably anywhere from 5 to 20 minutes.
The Chairman. That would be on some race at Hialeah or Tropical
Park out here ?
Mr. O'RouRKE. I don't know if he bet much on any Florida races.
I think it was more the eastern tracks. I don't know because Florida
was running most of the time.
The Chairman. Anyway, you would take a bet on any track he
wanted to place it on?
Mr. O'RouRKE. Not on California.
The Chairman. Was the pay-off on the basis of the pari-mutuel
pay?
Mr. O'RouRKE. Yes, sir.
The Chairman. That is the way you figured it?
Mr. O'RouRKE. Yes, sir.
The Chairman. You referred to the partnership that you had with
Erickson at Boca Raton. When did you first start doing business
with Mr. Erickson ?
Mr. O'RouRKE. If I remember right, I did business with him 2
years. It must have been '47 and '48.
The Chairman. Did he have any interest in your dice game that
you had in West Palm Beach?
Mr. O'RouRKE. No interest whatever in anything.
The Chairman. The only connection you had with Mr. Erickson,
according to your testimony, was at Boca Raton?
84 ORGAN^IZED CRIME IN IIS^ERSTATE COMMERCE
Mr. O'RouRKE. That is absolutely right.
The Chairman. Wlieii was the hrst you knew he had made out a
partnership income tax return ?
Mr. O'RouRKE. It was some time during the summer, after he left
herQ. He sent me a copy of the partnership return that had been
turned in and I think, if I remember right — —
The Chairman. Did you have that when Mr. Hart made out your
personal income tax return?
Mr. O'RouRKE. No, sir, it came later.
The Chairman. You turned that over to Mr. Hart, did you?
Mr. O'RouRKE, Yes, sir.
The Chairman. Later on?
Mr. O'KouRKE. Yes, sir.
The Chairman. Did you use a separate bankroll for the operations
at Boca Eaton and also for your crap game ?
Mr. O'RouRKE. You mean as cash?
The Chairman. Yes.
Mr. O'RouRKE. Yes, sir, it was separate cash.
The Chairman. The two businesses were not interlocked insofar
as the personnel of the operation were concerned, except yourself?
Mr. O'RouRKE. No. We had diiferent personnel down there.
The Chairman. You took checks or profits from both operations
and put them in the same bank account ?
Mr. O'RouRKE. Yes, sir.
The Chairman. JNIr. O'Rourke, how do you pay off for protection
for your operations ?
Mr. O'RouRKE. I don't know there was any protection.
The Chairman. You can't operate a place like that in violation
of the law unless somebody knows about it. Who did you pay off?
Mr. O'EouRKE. I didn't pay anybody off.
The Chairman. Mr. O'Roiirke
]Mr. O'RouRitE. I have friends in politics. I have been in Florida
ever since 1919.
The Chairman. Mj question was : Who did you pay off for your
protection in Palm Beach?
Mr. O'RouRKE. As far as protection. I may give a little for cam-
paigns and stuff like that, but that is all.
The Chairman. How much for campaigns, sa}', in 1948?
Mr. O'RoTJRKE. 1948 ? I don't think it would run inuch in an elec-
tion. I don't remember of any election in 1948.
The Chairman. The sheriff's election?
Mr. O'RouRKE. No, it doesn't make any difference, sheriff or any-
body come along — ^maybe $100 or $150 or something like that. It
is a donation.
The Chairman. In cash?
Mr. O'RouRKE. Sometimes it takes care of a little advertising in
maybe the newspapers or something like that.
The CHAiR:i\rAN. Cash ?
Mr, O'RouRKE. Not to them, workers and things like that.
The Chairman. Was it cash that you paid out ?
Mr. O'RouRKE. Oh, yes; a little out of my pocket.
The Chairman. Out of the bank roll ?
Mr. O'RouRKE. No, sir; mostly out of my pocket.
ORGANIZED CRIME IN INTERSTATE COMIVIERCE 85
The Chairman. You didn't give any checks?
Mr. O'RouRKE. No, sir.
The Chairman. How much would your contributions for ad vert is-
ino; or wliat not be in the year, say, 1948?
Mr. O'RouRKE. I don't think, Senator, honestly that it would run
very much ; maybe $1,500 or $2,000 for different things.
A lot of times they come around and tell you they have a little pro-
gram and things like that and you do favors for them like that.
The Chairman. Mr. O'Rourke, my question to you was: Who did
you make these payments to ?
]Mr. O'RouRKE. Senator
The Chairman. Did you make a payment to the sheriff or to some-
body on behalf of the sheriff?
Mr, O'RouRKE. No, sir ; never had an agent, never paid an agent.
The Chairman. How about the sheriffs
yiv. O'RouRKE. I didn't pay no sheriff.
The Chairman. You didn't pay, but just a little contribution — a
small amount?
Mr. O'RouRKE. At election time I would help out in my way, get
out and work and do things like that.
The Chairman. Now about the money?
Mr. O'RouRKE. Very little donations on that end of it. I may have
given a little money.
The Chairman. To the sheriff's committee?
Mr. O'RoLRKE. No, the Democratic committee, the executive com-
mittee organization — things like that, or campaigns like that.
The Chairman. Did you make any record of what you gave ?
Mr. O'RouRKE. No ; I did not on personal donations.
The Chairman. Your dice game was wide open for anybody to come
in to, wasn't it ?
Mr. O'RouRKE. Yes, sir.
The Chairman. How long did you operate that ?
Mr. O'RouRKE. I don't know, maybe 3 or 4 years.
The Chairman. Did you ever get raided until you were closed up
finally?
Mr. O'RouRKE. No, sir.
The Chairman. For being in violation of the law ?
Mr. O'RouRKE. No, sir.
The Chairman. Who did you talk to about not closing you up ?
Mr. O'RouRKE. I didn't talk to anyone in particular.
The Chairman. I know, but who in general? Who did you talk
with in general or in particular about giving you protection so you
wouldn't be closed up ?
]Mr. O'RouRKE. I don't think, Senator, that that atmosphere was to
anyone's discredit. It was more or less of a liberal community.
The Chairman. Mr. O'Rourke, you don't just operate a dice game
•wide open in a town in violation of the law for 3 or 4 years unless you
have some understanding about it. Who was it that' you talked with
in general or in particular ?
Mr. O'RouRKE. I don't remember talking to anybody in general or
particular about it.
The Chairman. Did you talk to anybody about it ?
Mr. O'Rourke. There was a boy when I went into the dice game.
He run a dice game and I went in bank roll with him.
86 ORG'ATSriZED CRIIVIE IN ESTTERSTATE COMMERCE
The Chairman. Wliat has that to do with whom you talked?
About using the bank roll with somebody else ?
Mr. O'RouRKE. I don't know.
The Chairman. Mr. O'Rourke, I am afraid you are not answering
the committee very fairly. It is our job to find out just how opera-
tions like yours operate without being closed up and what influence
with the local enforcement officers there is. How did you get by all
of this time without being closed up ?
Mr. O'RouRKE. I think more or less the reason I got by was being
local, being around the town for years, and in business there for
many years.
The Chairman. Wlio was your sheriff in 1948 ?
Mr. O'RouRKE. The same one as now.
The Chairman. What is his name ?
Mr. O'RouRKE. Kirk.
The Chairman. K-i-r-k?
Mr. O'RouRKE. Yes, sir.
The Chairman. Do you know him?
Mr. O'RouRKE. Yes, sir.
The CocAiRMAN. Did you contribute to his campaign ?
Mr, O'RouRKE. I went out and worked for him as much as I could.
The Chairman. Did you contribute to his campaign?
Mr. O'RouRKE. A little on the side ; not directly to him. .
The Chairman. How did you contribute ?
Mr. O'RouRKE. I don't think I put in $500 in it.
The Chairman. Do you think you put in $500 ?
Mr. O'RouRKE. I might have around a few different spots.
The Chairman. To whom did you give it ?
Mr. O'RouRKE. Hired a workers' group and give them maybe $10
to talk or maybe place cards.
The Chairman. Who did you give the big sums to ?
Mr. O'RouRKE. Not in his election I didn't give no big sums.
The Chairman. Did you have a talk with the sheriff before the
campaign about the fact that you were going to help him ?
Mr. O'RouRKE. No, sir; I did not. In fact, the sheriff was an old
ex-ballplayer and I played ball with him for years, and the first time
he ran, I was against him and this time I was for him.
The Chairman. You don't think all this work and this $500 that you
put in the sheriff's campaign had anything to do with your staying
in business?
Mr. O'RouRKE. No ; I don't. I think if he had a complaint or war-
rant or anything else he would have taken legal action.
The Chairman. Who was tlie mayor of West Palm Beach in 1918 ?
Mr. O'RouRKE. I don't know who it was in 1918.
The Chairman. Who is the mayor now ?
Mr. O'RouRKE. Mr. Keating. I don't even know him.
The Chairman. When did he come in ?
Mr. O'RouRKE. He came in about 2 weeks ago.
The Chairman. Who was the mayor just before he came in office?
Mr. O'RouRKE. The mayor was a man by the name of Holland.
I don't even know him. I met him one time.
The Chairman. Who is the head of the police department in West
Palm Beach?
Mr. O'RouRKE. Matthews.
ORGANIZED CRIME IN INTERSTATE COMMERCE 87
The Chairman. How long has he been there?
Mr. O'RouRKE. I think he has been in a little over 2 years, if I
remember right.
The Chairman. Do you know him?
Ml-. O'KouRKE. Not very intimately. I know his family and I knew
his old dad very well, but this young boy — I don't know him.
The Chairman. How was he selected ?
Mr. O'EouRKE. He is elected by the people.
The Chairman. Did you help him in his campaign?
Mr. O'RouRKE. No.
The Chairman. You didn't have any workers out for him ?
Mr. O'RouRKE. No, sir. In fact, I was then for the man he beat.
Senator Hunt. Mr. Hart made your personal income-tax return
and then later you received the partnership return from Mr. Erick-
son and you handed that to Mr. Hart. Did you make a supplementary
personal tax return showing some $34,000 of your profits from your
partnership ?
Mr. O'RouRKE. No, sir; I didn't.
Senator Hunt. You didn't do that ?
Mr. O'RouRKE. No, sir. It was included in the whole blanket thing.
I don't know" why Mr. Hart didn't. I turned it over to him. It was
a complicated affair.
Senatoi- Hunt. Has anything been said about not doing it?
]Mr. O'RouRKE. They have not.
Senator Hunt. They probably will, don't you suppose ?
Mr. O'RouRKE. Yes, sir ; I believe they will.
Senator Hunt. Why don't you beat them to it and attend to it
and save yourself a penalty ?
Mr. O'RouRKE. I have intended to do that, and I expect I will do
it. After he filed that, if I recollect, I think Mr. Hart said, "Maybe
we'll be penalized by it." He filed the report and sent it in later after
we filed our report.
Senator Hunt. Didn't you know that you had those earnings?
Mr. O'RouRKE. It was in my original report.
Senator Hunt. In your personal return?
Mr. O'RouRKE. Yes, sir ; in the blanket report.
Mr. Halley. You have just contradicted yourself. First you said
it was not included and then you said it was included.
Mr. O'RouRKE. I don't mean it was not included. What I say is — I
put mine all together in one report. I didn't itemize it separately as a
partnership.
Mr. Halley, As I remember, your return is not in accordance with
the facts.
The Chairman. I want to ask this question, Mr. O'Rourke : Were
you asked with whom you laid off bets?
Mr. O'Rourke. Yes; I believe I was.
The Chairman. How do you know the people who you can lay off
bets with?
Mr. O'Rourke. I don't think — I haven't laid many bets off.
The Chairman. When j'ou want to lay bets off, how do you know
who to get in touch with?
Mr. O'Rourke. For the last several years, I knew them by acquaint-
ance.
68958— 50— pt. 1 7
88 ORGANIZED CEIME IN INTERSTATE COMMERCE
The Chairman. Where ^vould you meet them?
Mr, O'RouRKE. Men who have been in the bookmaking business for
years.
The Cir AIRMAN. You laid off bets with Erickson?
Mr. O'EouRKE. No, sir; not a bet. The only transaction with Mr.
Erickson was on the deal I have mentioned.
The Chairman. Who did you lay off with in New York or Chicago ?
Mr. O'EouRKE. Not in New York or Chicago.
The Chairman. You got this man down here in Miami that you
can lay bets off with ?
Mr. O'RouRKE. I did for a while lay off a few bets to Dick Evans.
The Chairman. You must have some understanding between you
fellows about who will take a lay-off bet. How do you get that
information ?
Mr. O'RouRKE. You get to know the fellows that are in town here.
I have never laid any bets out of the State. In fact, there are three or
four bookmakers around there in West Palm Beach and we do busi-
ness with one another and naturally we did a little business with some
of the Miami boys locally around here that are close by, and that
comes from association.
Take football. If I need a couple of Orange Bowl tickets. I call one
of them and get some tickets for a friend and things like that, but I
never laid off' many bets. I think Dick Evans is the man I laid bets
off with. It is too hard to do that.
The Chairman. You read in the papers where Mr. Erickson's books
were secured in New York?
Mr. O'RouRKE. Yes, sir.
The Chairman. Have you talked with him since that time?
Mr. ORouRKE. Only to say "Hello.'*
The Chairman. Where was he when you said "Hello" ?
Mr. O'RouRKE. I only ran into him by accident, not by engagement,
prearranged or anything. I went to New York before 1 ever knew
his name was in the papers. I went up there to see a friend of mine
and ran into him in the barber shop.
The Chairman. Just accidentally?
]Mr. O'RouRKE. Yes. No prearranged meeting at all. That was
after he testified at Washington.
The Chairman. Did you see him after you ran into him at the
barber shop?
Mr. O'RouRKE. OnW a few minutes, after he got through shaving
and a haircut.
llie Chairman. Did you transact any business?
Mr. O'RouRKE. Not a single thing. The only thing I remember
referring to business was — I just asked him how he was feeling and
he said it was getting tough.
The Chairman. Did you see Frank Costello?
]Mr. O'RouRiiE. I don't know Frank Costello, only by his pictures
in the paper. I never met him in my life.
Tlie Chairman. Did you see Joe Adonis when you were up there?
Mr. O'RouRKE. I didn't talk to Joe Adonis. I saw him in Dinty
Moore's Restaurant. I had no business with liim. I know him by sight.
Mr. Hai,ley. When did you go to New York?
Mr. O'RouRKK. Wednesday two weeks ago or Tuesday a week ago.-
Mr. Halley. When did you return to West Palm Beach?
ORGANIZED CRIME IN INTERSTATE COMMERCE 89
Mr. O'RouRKE. I think I <rot in here Saturday.
Mr. Halley. Just a ^Yeek ago today ?
]\Ir. O'RouRKE. I think that was it. I am pretty sure it was a.
week ago today.
Mr. Halley. How long were you in New York ?
Mr. O'RouRKE. I stayed in New York one day and one night, and L
left the next day.
Mr. Halley, Did you go any place before New York?
Mr. O'RouRKE. That is right.
Mr. Halley. You stayed a day and a night and you returned here?
Mr. O'RouRKE. That 'is right.
Mr. Halli:y, What hotel did you stay in ?
Mr. O'RouRKE. Waldorf.
Mr. Halley. In what barber sliop did you meet Mr. Erickson?
]Mr. O'RouRKE. In the Waldorf.
:Mr. Halley. What day was that ?
]SIr. O'RouRKE. That was the morning after I got in. I think it
was on a Wednesday.
Mr. Halley. You just hapjjened to bump into Erickson in the
Wfddorf Barber Shop ?
Mr. O'RouRKE. That is right.
Mr. Halley. Did you see him or did he see you ?
Mr. O'RouRKE. i didn't know he was in there. He was in the
barber chair.
Mr. Halley. Did he recognize you and call you over ?
Mr. O'RouRKE. No, sir.
Mr. Halley. Did you see him in the barber shop ?
Mr. O'Rourke. Yes.
Mr. Halley. And you walked over to him ?
Mr. O'Rourke. That is right.
Mr. Halley. That is all.
The Chairman. Did you ever talk with him on the telephone since
then ?
Mr. O'Rourke. No, sir ; not since then.
The Chairman. Is there anything else, Mr. Halley ?
]\lr. Halley. That is all. Thank you.
The Chairman. Thank you, Mr. O'Rourke.
Tlie committee will recess until 2 o'clock.
(Wliereupon, at 12:45 p. m. a recess was taken to reconvene at
2 p. m.)
afternoon session
The Chairman. The hearing will be resumed.
FURTHER TESTIMONY OF ABE ALLENBERG, MIAMI BEACH, FLA.
The Chairman. Mr. Allenberg, you were sworn yesterday, were
you not ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Have you responded to the subpena duces tecum that
was served upon you ?
Mr. Allenberg. Yes, sir.
Mr. Halley. And you have furnished certain records to this com-
mittee?
Mr. Allenberg. Yes, sir.
90 ORGANIZED CRIME IX INTERSTATE COMMERCE
Mr. Halle Y. Do you want to identify the records that you have
produced ?
What are these documents I have here ?
Mr. Allenberg. Those are income-tax returns.
Mr. Hallet. For what years ?
Mr. Allenberg. For many years back.
Mr. Hallet. They run up to 1949 ?
Mr. Allenberg. I think 1946, 1947, 1948, and 1949 are in the hands
of Mannie Kramer, who is an accountant.
Mr, Hallet. In the hand.s of Mannie Kramer, who is an accountant ?
Mr. Allenberg. Yes, sir.
Mr. Hallet. And these are the ones for prior years; is that right?
Mr. Allenberg. Yes, sir.
Mr. Hallet. I offer in evidence these documents as exhibit No. 40
the income tax file from 194:2 to 1944 for Abe Allenberg, which file
also contains letters from Andy Pellino on the stationery of Henry
Pellino, a certified public accountant of New York City, discussing
Allenberg's taxes in connection with those of Frank Erickson.
The Chairman. It will be received and made a part of the record.
( Exhibit No. 40, income tax returns and papers relating thereto are
on file with committee ; letters from Pellino appear in the appendix
on p. 731.)
Mr. Hallet. And you have an envelope of miscellaneous papers
referring to the Wofford Hotel i
Mr. Allenberg. Yes, sir; miscellaneous papers referring to the
Wofford Hotel.
Mr, Hallet. I offer in evidence a folder of miscellaneous papers
referring to the Wofford Hotel as exhibit No. 41.
The Chairman. It will be received and made a part of the record.
(Folder of miscellaneous papers re Wofford Hotel received in evi-
dence as exhibit No, 41 on file with committee.)
Mr. Hallet. Here is another batch of miscellaneous papers con-
cerning Tropical Park and Gables Racing Association.
The Chairman, Let these miscellaneous papers in the brown enve-
lope be filed and made a part of the record as exhibit No. 42.
(Miscellaneous papers re Tropical Park and Cables Racing Asso-
ciation received in evidence as exhibit No. 42 on file with connnittee.)
Mr. Hallet. When did you first come to Miami ?
Mr, Allenberg. 1935.
Mr. Hallet. Will you state the circumstances ^
Mr. Allenberg. I came down here representing Frank Erickson
in the purchase of an interest. in the Gables Racing Association. Ho
bought a 20 percent interest in the Gables Racing^Association. The
interest was taken in my name as trustee, and that contimied on until
1941.
Mr. Hallet, In otlier words, you came down as Frank Erickson's
agent in the Gables Racing Association ?
Mr. Allenberc;. As his attorney.
Mr. Hallet. How much money did he invest in the Gables Racino-
Association? ' *^
Mr. Allenberg. Upward of $250,000.
Mr. Hallet. Did you serve as president of the Troi:>ical Park Race
Track?
ORGANIZED CMME IN INTERSTAT'E COMMERCE 91
Mr. Allenberg. Xo. I served as comptroller of the race track.
Mr. Halley. How much money was invested in all by the various
people in this Tropical Park Kace Track ?
Mr. Allenberg. The race track had already been in existence for
a few years and was on the ver<re of bankruptcy when this money was
put in! This money was put in to keep the race track solvent. Up td
that time I don't know how nuu-li had been invested.
Mr. Halley. At the time that Erickson put his money in, then, he
was the only man to supply new capital ; is that ri<rht ?
Mr. Allenbekg. That is ri<rht.
Mr. Halley. And he took over control of Tropical Park Track?
Mr. Allenberg. Yes. sir.
Mr. Halley. With you as his representative ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Were you on a salary basis?
Mr. Allenberg. Yes, sir.
Mr. Halley. Did you have any interest in the business as an owner?
Mr. Allenberg. Xo, sir. He took all of the profits, whatever tliey
were.
Mr. Halley. Did you get a commission of any kind ?
Mr. Allenberg. Xo, sir.
Mr. Halley'. a straio;ht salary?
Mr. Allenberg. Straight salary.
Mr. Haij:,ey. Hoav nuich ?
Mr. Allenberg. Started at $10,000 and I think it went to $15,000
a year.
Mr. Halley. Did you have any other business interests in Miami
or Miami Beach after 1935 while you were connected with Tropical
Park Track?
Mr. Allenberg. Xot while I was with Tropical Park Race Track.
Mr. Halley. Did you have any other income except your salary
from Frank Erickson?
IVIr. Allenberg. Xo. I didn't get a salary from Frank Erickson.
It came from the Gables Racing Association.
Mr. Halley. Which operated the track ?
Mr. Allenberg. ^^Hiich operated the track.
Mr. Halley. And you devoted all your time to the track ?
Mr. Allenberg. Yes, sir.
Mr. Halley. In 1941, what happened ?
Mr. Allenberg. The stock of the Gables Racing Association was
sold and Erickson was then out of Tropical Park Race Track. The
stock was sold in the Gables Racing Association at that time and
he received the proceeds of the sale.
Mr. Halley. What did you do after that ?
Mr. Allenberg. After that I made arrangements with Tom Cas-
sara to take over the operation of the Wofford Hotel.
Mr. Halley. Would you state the circumstances under which that
arrangement was made? How did you first meet Cassara and so
forth?
JNIr. Allenberg. I had known Cassara down here and he heard that
I was looking around to get into the hotel business since I was out
of Tropical Park Race Track, and he suggested that I take over from
him the lease of the Wofford Hotel. I couldn't take the lease over be-
92 ORGANIZED CRIME IN INTERSTATE COMMERCE
•cause Mrs. Wofford wouldn't sign it, so we took it over under a man-
agement contract, and I had a half interest in it and in order to clean
up the debts of the Wofford Hotel, it required a little over $20,000. I
put $10,000 in and I borrowed the balance from Frank Erickson, and I
regarded it as a loan when I took it, but he might have regarded it
as a partnership arrangement with me.
At any rate we continued on for 2 years and he got his money back
plus an overage, and one day I talked with him and he said he didn't
want to have anything to do with the Wofford Hotel. He said, "You
can have it on your own."
Sothen I continued on for the next couple of years. The Wofford
Hotel was my own proposition.
Mr. Halley. How much money did he give you to invest in the Wof-
ford originally?
Mr. Allenberg. $11,500. He loaned me some after that to keep it
going with.
Mr. Halley. How much in all did he lend you ?
Mr. Allenberg. He might have loaned me another $10,000 after I
was in operation.
Mr. Halley. So your best estimate is that he gave you a total of
over $20,000 ?
Mr. Allenberg. That is right, and that was paid back to him.
Mr. Halley. At what time did you first go into the management
of the Wofford?
Mr. Allenberg. That was in November of 1941 ?
Mr. Halley. And when did you leave the Wofford ?
Mr. 'Allenberg. In 1945. I came back there for the winter of
1945-46 and stayed there until it was either March or April of that
year.
Mr. Halley. During that time, was Erickson interested in the
Wofford?
Mr. Allenberg. For the first 2 years.
Mr. Halley. And after that, Erickson no longer had an interest
in it?
Mr. Allenberg. No.
Mr. Halley. Did he receive any part of the profits after — in the
first 2 years ?
Mr. Allenberg. I don't know whether he received it as profits or
part of his money back.
Mr. Halley. Who kept the accounts for the Wofford ?
Mr. Allenberg. The accounts were kept by the accountants.
Mr. Halley. Isn't it a fact that you reported the income to Erick-
son and that he was given what was known as his share of the profits?
Mr. Allenberg. It might have been reported that way.
Mr. Halley. Continuing with the Wofford Hotel, what other people
were in the management besides yourself and Cassara ?
Mr. Allenberg. After 1 got in there, I found out that John King
had an interest in it, and a man called Augie Carfano had an interest
in it.
Mr. Halley. Now, Augie Carfano was called Little Augie, was
he not ?
Mr. Allenberg. Yes.
Mr. Halley. And John King is a well-known racketeer from Cleve-
land, isn't he ?
ORGANIZED CRIME IN INTERSTAT'E COMMERCE 93
Mr. Allenberg. I have since learned that.
Mr. Halley. You didn't know it at that time ?
Mr. Allenberg. No, sir.
Mr. Halley. Isn't it something of a remarkable coincidence that at
that one hotel at the same time there should go into the management
you who had been Erickson's representative with Erickson's money,
Little Augie, and Jolm King — all at the same time ?
Mr. Allenberg. Yes,
Mr. Halley. At the time, Erickson did not want to go into the
Wofford Hotel deal?
Mr. Allenberg. That was the only deal that I could find for myself
to go into business on the beach because it took the least amount of
money and I asked Erickson if he would loan me that money to take
an interest, or take his money in whatever way I would be able to give
it to him, so that I could have something to be doing down here at the
beach. There were no other hotels to get. There were others, but it
took a lot of money to get a hotel. I could have bought the other half
of the interests that were in there for another $20,000 if I had had it.
I didn't go in there to go in with Carfano, King, or Erickson. I
originally tried to go in with two other gentleman here in town, but
Mrs. Wofford would not consent to an assignment of the lease. I went
to her and she said they — she wouldn't consent to an assignment ; I had
to go in on my own.
Mr. Halley. Once you got into the WofFord Hotel, a number of
Erickson's people moved in ; isn't that right ?
Mr. Allenberg. Right.
Mr. Halley. Who were they?
Mr. Allenberg. They were living there from time to time — Briggs.
Mr. Halley. Who is Briggs, and will you tell us what his business
was?
Mr. Allenberg. Briggs was associated with Erickson.
Mr. Halley. What did Briggs do ?
Mr. Allenberg. He would represent Erickson in some of these
gambling ventures they had; whether it was the race track or the
Hollywood Beach Hotel or some of the gambling clubs — whatever
they might be, he would be with him.
Mr. Halley. What were some of these gambling ventures that you
speak of? Let's start with the race track. Describe the gambling
ventures at the race track.
Mr. Allenberg. Gambling ventures at the race track would be
where there are men to go to the race track or make bets on horses and
they don't bet money into the mutuel machines, but they bet it with
what are known in race tracks as bookmakers. That is what the func-
tion of those men w^ould be.
Mr. Halley Let me see. Erickson has operated books within the
grounds of the various race tracks around Miami ?
Mr. Allenberg. Yes, sir.
Mr. Halley. And he operated them through these people he had sta-
tioned there in Miami ?
Mr, Allenberg. That is right.
Mr. Halley. Who are some of the people who operated inside of the
track for Erickson ?
Mr. Allenberg. Briggs, Cantor, Zeldow. Those men would also do
this at the track : They handled what is known as come-back money.
94 ORGANIZED CE'IME IN INTERSTATE COMMERCE
That is money that is bet, that is called in to a telephone somehow in
the neighborhood and they would come into the race track and would
bet it on the horses.
Mr. Halley. There was a central clearinghouse for that type of
bet in Miami, wasn't there, such as a bar or a room above a bar?
Mr. Allenberg. That would bet right out at the race track.
Mr. Halley. The bets came in by phone from somewheres 'i
Mr. Allenberg. Yes. They would go to the race track or some
place in the vicinity of the race track. There might have been another
one in tow^n, but I don't know whether Erickson would have anything
to do with that. That might be of a local nature.
Mr. Halley. The phone call would be at the race track in a phone
booth?
Mr. Allenberg. Not at, but right adjacent to the race track so you
can get inside,
Mr. Halley. Somebody to bring in the money ?
Mr. Allenberg. Yes, sir.
Mr. Halley. And Erickson would have a man to receive the phone
calls?
Mr. Allenberg. Yes ; it would be one of those men.
Mr. Halley. Who besides Briggs and Cassara did that work at the
race track?
Mr. Allenberg. Zeldow, Strader. Another fellow used to be around
there with them. At any rate, I think the man died.
The Chairman. How would it be if we got continuity of what Mr.
Allenberg is telling us and then go back into anything that we need to
fill in?
Mr. Halley. Fine. Go right ahead.
Mr. Allenberg. Having been at the race track for many years, I
knew many of the intricacies of the workings and what tliey do out
at the race track. Then after they wovild be out there, tliey would
meet certain people and bet on horses, and they would bet with them — -
maybe it might be John Jones or Tom Smith who would make his
bets with him, and those would be the men who were taking the bets.
They were Erickson's representatives. As to paying off, they had an
agreement, whether the next day or the same day or the week after-
ward, it all depended who the people were. Many of those men lived
at the hotel where I was associated with it, and they wanted to give
me the hotel business rather than give their business to somebody
else.
Anyhow, I had the business, and I would accommodate them practi-
cally every day by cashing checks for them.
The Chairman. Go ahead.
Mr. Allenberg. Also at the race track were these men who would
sometimes, I imagine, play part of their bets back into the machine
again in order to give the race track additional business.
Senator, that I think was the picture of what a man could do on
the race track pretty fully. He takes bets from somebody.
> The Chairman. Mr. Allenberg, we want the picture about how this
mob operates, and w^e are going to get it either the easy way or the
hard way because you know.
Mr. Allenberg. I am telling you the easy way. That is the picture
at the race track. They take their bets, and they pay off either that
ORGANIZED CRIME IN INTERSTATE COMMERCE 95
day or tlie next day or whatever the method would be that they would
have arranged for with the man they did the betting with.
The Chairman. What else happened ?
Mr. Allenbekg. And they would win or lose on those things.
The Chairman. Then you left the Wofford ?
Mr. Allenberg. I left the Wofford Hotel, yes, sir, in 1945.
The Chairman. Where did you go to then ^
Mr. Allenberg. To the Boulevard Hotel with two partners. One
was Herman Levitt and the other was Charlie Collins, both hotel men
for many 3'eai'S on the beach ; well-known hotel men.
The Chairman. And the mob went with you?
Mr. Allenberg. Some of Erickson's men came over to the Boule-
vard Hotel. There was 'nobody followed anybody there. Senator.
There were many race-track clerks in the area of Miami during the
time of the races. The racing season was on.
The Chairman. Here first is a photostat of what appears to be a
pajier dated September 21, 1945, relative to a partnership on the Wof-
ford Hotel. Do you recognize those signatures ?
Mr. Allenberg. I recognize the names, sir — Carf ano and Lorentzen.
Lorentzen was a relative of John King's; I remember that.
The Chairman. Let that be filed as exhibit No. 43.
(Photostat of paper referring to partnership in Wofford Hotel,
dated September 21, 1945, received Jn evidence as exhibit No. 43.
Loaned to committee by Mr. Daniel P. Sullivan, Greater Miami Crime
Commission, and subsequently returned to him.)
The CiLMR:\f AN. Here's a photostat dated December 28, 1945, advis-
ing about the formation of a partnership between Abe Allenberg and
Anthony Carfano and Otto Lorentzen. Do you recognize those signa-
tures ?
Mr. Allenberg. Yes, sir.
Mr. Halley. As yours?
Mr. Allenberg. Yes, sir.
The Chairman. Those are the men you were in partnership with?
Mr. Allenberg. It says I assigned my interest in the partnership
over to those men. It says that I disposed of my interest.
The Chairman. Up here are the names of the partners and then
you assigned it to some other people?
Mr. Allenberg. Yes, sir.
The Chairman. That is exhibit No. 44.
(Document dated December 28, 1945, re formation of partnership
of Abe Allenberg, Anthony Carfano, and Otto Lorentzen received
as exhibit No. 44. Loaned by, and later returned to Mr. Daniel
Sullivan.)
The Chairman. Here is a photostat of a document dated April 20,
1945, saying that Anthony Carfano is a partner and that he has au-
thority to sign checks; is that correct?
Mr. Allenberg. Yes, sir. I was out of there along there.
The Chairman. That will be exhibit No. 45 and made a part of the
record.
(Document dated April 20, 1946, authorizing Carfano to sign checks
received in e\^idence as exhibit No. 45. Loaned by, and later returned
to Mr. Daniel Sullivan.)
The Chairman. Do you recognize the signature on this paper of
May 23, 1946, which is an assignment?
Mr. Allenberg. Yes, sir.
96 ORGAlSrrZED CKIME in nSTTERSTATE COMMERCE
The Chairman. Tliat will be exhibit No. 46.
(Assignment dated May 23, 1946, received in evidence as exhibit
No. 46. Loaned by, and later returned to Mr. Daniel Sullivan.)
The Chairman. Here is a group of checks signed by Abe Allen-
berg, trustee, Wofford Hotel, for different amounts, either signed by
you or Joseph Cardone or Fred J. King. Do you identify the signa-
tures on those checks ?
Mr. Allenberg. Yes, sir.
The Chairman. They will be received and made a part of the
record.
(Group of checks signed by Abe Allenberg, trustee, Wofford Hotel,
received in evidence, exhibit No. 47. Loaned by, and later returned to
Mr. Daniel Sullivan.)
The Chairman. Do you recognize this picture, Mr. Allenberg?
Mr. Allenberg. That is Carf ano.
The Chairman. He is the man with whom you were in partnership ?
Mr. Allenberg. Yes, sir.
The Chairman. That will be received and made a part of the
record.
(Photograph of Anthony Carf ano, alias Little Augie, received in
evidence as exhibit No. 48.)^
The Chairman. Little Augie was your partner ?
Mr. Allenberg. Yes ; I am sorry to say.
The Chairman. Do you recognize this picture?
Mr. Allenberg. That is Frank Erickson.
The Chairman. That is Frank Erickson?
Mr. Allenberg. Yes, sir.
The Chairman. He was your sponsor in this ?
Mr. Allenberg. Yes, sir.
The Chairman. That will be received and made a part of the
record.
(Photograph of Frank Erickson received in evidence as exhibit
No. 49.)
The Chairman. Did he stay at the Wofford Hotel ?
Mr. Allenberg. Sometimes.
The Chairman. And Little Augie was there, of course?
Mr. Allenberg. Yes, sir.
The Chairman. Do you recognize this picture?
Mr. Allenberg. That is Joe Adonis.
The Chairman. Did he stay at your hotel?
Mr. Allenberg. I think he did at times.
The Chairman. That will be received and made a part of the
record.
(Photograph of Joe Adonis was received in evidence as exhibit
No. 50.)
The Chairman. Let's go back just a minute. The first was Little
Augie ?
Mr. Allenberg. Yes, sir.
The Chairman. What was his legitimate interest in INIiami ? Wliat
business did he have here?
Mr. Allenberg. He had an interest in the Raleigh Hotel, I am told,
and he had an interest in the AVofford Hotel.
1 Exhibit Nos. 48 througli 99, wliicli are photographs, are on file with the committee.
ORGANIZED CRIIME IN INTERSTAT'E COMMERCE 97
The Chairman. What else ? . t- -it n
Mr Allenberg. He was supposed to be representing Jimmy Kelly,
his father-in-law. That is how I understood it. Jimmy Kelly was
a racketeer and night club man in New York and a Democratic leader.
The Chairman. What other interests did he have m Miami ^
Mr. Allenberg. Outside of those two, I don't know.
The Chairman. What illegitimate interests did he have?
]\Ir. Allenberg. Gambling by playing horses and going to the
night places and gambling. I don't know what his interest was m
any place.
The Chairman. And the exhibit before was that of Frank J^rick-
son?
Mr. Allenberg. Yes, sir.
The Chairman. What were Frank Erickson's interests in Miami?
Mr. Allenberg. Frank Erickson's interest in Miami was Tropical
Park, and the interest he had with me in the Wofford Hotel.
The Chairman. What else ?
Mr. Allenberg. He had an interest in the Colonial Inn, and he had
an interest years ago in the Boheme Club.
The Chairman. What is his interest here now ?
Mr. Allenberg. Nothing as far as I know, Senator.
Mr. Halley. You haven't told Senator Kefauver all of the interests
that Frank Erickson has had in and around Miami. How about
the three big hotels, the Hollywood Beach, Boca Raton, and the
Roney ^
Mr. Allenberg. He has had a concession at the Roney Plaza Hotel,
an interest in the concession at the Hollywood Beach Hotel, and the
concession at the Boca Raton Club.
Mr. Halley. What kind of concession ?.
Mr. Allenberg. Bookmaking concession.
Mr. Halley. He operated a private book ?
Mr. Allenberg. Yes, sir.
The Chairman. How much did he pay for the concession at the
Roney Plaza?
Mr. Allenberg. All I know, Senator, is what I get from hearsay.
I never heard it.
The Chairman. Now, Mr. Allenberg
Mr. Allenberg. I didn't know just until the thing was closed that
he was in it. I heard he paid $55,000.
The Chairman. You didn't know anything about the negotiations ?
Mr. Allenberg. No, sir ; not in the least.
The Chairman, What did it come to at the Boca Raton Club ?
Mr. Allenberg. That I don't know.
The Chairman. Did you negotiate any of these?
Mr. Allenberg. No, sir; because I was not in favor of them.
The Chairman. You didn't approve of them ?
Mr. Allenberg. No, sir.
The Chairman. Who is this a picture of ?
]\[r. Allenburg. That is Meyer Lansky.
Mr. Halley. That will be exhibit No. 51.
(Photograph of Meyer Lansky received in evidence as exhibit No.
61.)
The Chairman. Did he stay at the Wofford Hotel?
Mr. Allenberg. He did occasionally ; yes, sir.
^8 ORGANIZED CKiME IN INTERSTATE COMMERCE
The Chairman. He is a well-known criminal ?
Mr. Allenberg. Yes, sir.
The Chairman. Who is this a picture of?
Mr. Allenberg. This one I don't know, Senator.
The Chairman. Look on the back and see if you can recognize his
name ?
Mr. Allenberg. I recognize the name "'Jimmy Bkie Eyes," it says
on here.
The Chairman. Do you know him?
Mr. Allenberg. He stopped at the Wofford Hotel.
The Chairman. Then he was a customer of yours ?
Mr. Allenberg. Yes, sir.
The Chairman. And he is a well-known criminal?
Mr. Allenberg. Yes, sir.
Mr. Halley. Didn't he also have an interest in the Colonial Inn with
Erickson ?
Mr. Allenberg. From what I have read in the newspapers.
Mr. Halley. And from what you know, too. Let's keep away from
what you read in the newspapers.
Mr. Allenberg. Don't push me any further than I have to be
pushed. I don't know. I never spoke to the man about his interests
in the Colonial Inn. I never spoke to the man about any of his in-
terests. If he stopped at the Wofl'ord Hotel, it was because he came in
and rented a room there.
Mr. Halley. Did you ever speak to Erickson about his interests in
the Colonial Inn?
Mr. Allenberg. No, sir; I did not.
The Chairman. The one before is Lansky. What was his interest
in Miami ?
Mr. Allenberg. I was led to believe it was in the Colonial Inn or
in gambling places tliat would be up in Broward County. I never
spoke to him about it.
The Chairman. You don't know of any other interests ?
Mr. Allenberg. No, sir.
The Chairman. Let this be received and made a part of the record.
(Photograph of Vincent x\lo, alias Jimmy Blue Eyes received in
evidence as exhibit No. 52.)
The Chairman. Do you recognize the name of this party ?
Mr. Allenberg. Yes, sir.
The Chairman. What is his name?
Mr. Allenberg. I can't think of it. I recognize his face.
Tlie Chairman. Look on the back.
Mr. Allenberg. Michael Coppola.
The Chairman. Do you remember him now?
Mr. Allenberg. Yes, sir.
The Chairman. Wliat is his alias?
Mr. Allenberg. I didn't know lie had an alias, only what I see here —
Trigger Mike.
The Chairman. Did you know him as Trigger Mike?
Mr. Allenberg. No, sir.
Tlie Chairman. Did lie stay at the Wofford Hotel?
Mr. Ali>eni'.er(;. Yes, sir; I am pretty sure.
The CiiAHiMAN. What was his interest in Miami?
ORGANIZED CRIME IN INTERSTATE COMMERCE 99'
Mr. AiJ.EXBKHG. I wouldn't know except that he was interested in
gambling houses.
The Chairman. Do you know of an}' property he owns?
Mr. Allenberg. No, sir.
The Chairman. This picture will be received and made a part of
the I'ecord.
(Photograph of Michael Coppola, alias Trigger Mike, received ia
evidence as exhibit No. 5-).)
The Chairman. Do you recognize the picture of this man?
Mr. Allenberg. No, sir.
The Chairman. Look at the back and see if you know his name.
Mr. Allenberg. No, sir.
The Chairman. You don't know him ?
Mr. Allenberg. No, sir.
The Chairman. Julius Kramer: does that strike a familiar ring?
JNIr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Julius Kramer received in evidence as exhibit No.
54.)
The Chairman. Do you recognize the picture of this person?
]\Ir. Allenberg. No, sir.
The Chairman. What is the name on the back of that picture?
Mr. Allenberg. Bennie Kay.
The Chairman. Do you know Bennie Kay ?
Mr. Allenberg. Yes, sir.
The Chairman. Is that him?
Mr. Allenberg. Yes, sir.
The Chairman. Then you do recognize his picture?
Mr. Allenberg. I do know after I looked at it.
The Chairman. Was he a customer of the Wofford Hotel?
Mr. Allenberg. Not when I was there.
The Chairman. Was he over at the Boulevard Hotel?
Mr. Allenberg. No, sir.
The Chairman. When did you see him ?
Mr. Allenberg. Around in the restaurants in town.
The Chairman. Did you know him to s])eak to (
Mr. Allenberg. I knew him to say "hello" to.
The Chairman. Where did you first know him ?
Mr. Allenberg. I think in Wolfie's.
The CiiAiRMAx. What is his interest in Miami ?
Mr. Allenberg. He is in the gambling house business. He is sup-
posed to be the man connected with the Blackamoor Room or some
club over the Blackamoor Room. They played cards or gambled.
The Chairman. Is that in Miami ?
Mr. Allenberg. Miami Beach.
The Chairman. That will be received and made a part of the rec-
ord.
(Photograph of Bennie Kay received in evidence as exhibit No. 55.)
The Chairman. Do you recognize the picture of this man?
Mr. Allenberg. No, sir.
The Chairman. Look at his name.
Mr. Allenberg. No, sir: I don't know him by name either: repu-
tation or otherwise.
100 ORGANIZED CRIME IX INTERSTATE COMMERCE
The Chairman. The name is Frank
Mr. Allenberg, Livorsi.
The Chairman. You never saw him?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Frank Livorsi received in evidence as exhibit
No. 56.)
The Chairman. Do you know this man ?
Mr. Allenberg. No, sir.
The Chairman. Look at his name on the back.
Mr. Allenberg. I recognize the name "Poagy."
The Chairman. Was he one of your customers at the hotel ?
Mr. Allenberg. He lived at the Wofford Hotel.
The Chairman. Where is he from ?
Mr. Allenberg. I don't know.
The Chairman. He is a well-known gambler, isn't he ?
Mr. Allenberg. I don't know what his business is. Senator.
The Chairman. What was his interest in Miami ?
Mr. Allenberg. I don't know.
The Chairman. That will be received and made a part of the record.
(Photograph of Alfred Toriello received in evidence as exhibit
No. 57.)
The Chairman. Do you recognize this picture ?
Mr. Allenberg. That is Frank Costello.
The Chairman. Did he ever stay at the Wofford Hotel ?
Mr. Allenberg. Yes, sir ; I think he did.
The Chairman. Ancl at the Boulevard Hotel ?
Mr. Allenberg. No, sir ; he never stopped there.
The Chairman. How well did you know Frank Costello?
Mr. Allenberg. How well? I didn't know him .well at all. I
know him to say "Hello" to.
The Chairman. He stayed in your hotel ?
Mr. Allenberg. Yes, sir.
The Chairman. Did you know him in New York before you came
down here ?
Mr. Allenberg. Yes, sir.
The Chairman. How well did you know him in New York ?
Mr. Allenberg. I didn't know him well in New York, either. I
knew him from having met him through Frank Erickson.
The Chairman. How long did you know him in New York before
you came here ?
Mr. Allenberg. Maybe 2 or 3 years.
The Chairman. Did you ever have any business dealings with him?
Mr. Allenberg. I never had ; no, sir.
The Chairman. How did you happen to know him?
Mr. Allenberg. I met him tlirough Frank Erickson.
The Chairman. What is Frank Costello's business interest in
Miami?
Mr. Allenberg. I don't know wliat Frank Costello's business
interest is, Senator. All I know is he is supposed to be interested up
in the Colonial Inn in Broward County, but not down here.
The Chairman. Does he have an interest up there now?
Mr. Allenberg. That I don't know, Senator.
ORGANIZED CRIME IN INTERSTATE COMMERCE 101
The Chairman. Now, can you tell us what other interests he has?
Does he have an interest in the bookie operations in the Koney Plaza?
Mr. AiXENBEBG. I don't know.
The Chairman. What is your best information? ^
Mr Allenberg. My information would be that he doesn t have.
The Chairman. Let this photograph be received and made a part
of the record. . ■, . ■ -, i -u-^
(Photograph of Frank Costello received ni evidence as exhibit
No. 58.) ^ ^ ^ . ,
The Chairman. These pictures, most of whom you recognized, are
the so-called New York syndicate, aren't they ? Erickson, Costello
Mr. Allenberg. Gamblers, yes, sir. • , • g
The Chairman. That is the so-called New York syndicate, isn t it i
Mr. Allenberg. I would say "Yes."
The Chairman. And they were all practically customers ot your
hotel ?
Mr' Allenberg. They all lived at the Wofford Hotel, Senator.
The Chairman. You were glad to have them there, weren't you?
Mr. Allenberg. No, sir.
The Chairman. Why didn't you keep them out ? .•■■,.
Mr. Allenberg. When a guest comes to stop at a hotel, it is hard
keeping him out.
The Chairman. They were there during the war years, weren t
they? 1943 and 1944?
Mr. Allenberg. That is right.
The Chairman. Were you turning people away?
Mr. Allenberg. Yes, sir.
The Chairman. You were turning people away in droves, so you
could pretty well choose your guests.
You know you would go down personally to meet some of them at
the train. For instance, Frank Erickson ?
Mr. Allenberg. Erickson; yes, sir.
The Chairman. And Costello?
Mr. Allenberg. Not Costello, sir.
The Chairman. And Frank Erickson and his whole bunch — his ac-
countant, ills wife, and you had an arrangement where you could drive
your car next to where they would get off and put them in your car
and take them to the hotel.
Mr. Allenberg. It was not my car because we hired it.
The Chairman. You did have a car hired and you would go down
and get them right out of the puUman, into your car so you wouldn't
have any inconvenience and they wouldn't be seen ?
Mr. Allenberg. I don't know that it actually was not to be seen.
The Chairman. Did you go to meet all of your guests like that?
Mr. Allenberg. Some of them I did.
The Chairman. Your special ones?
Mr. Allenberg. They would have to be special to go down and meet
them.
The Chairman. Let's look at a few more pictures and see if you
recognize them.
Do you recognize this man?
Mr. Allenberg. No, sir.
The Chairman. Look at his name on the back and see if you know
his name.
102 [ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Allenberg. I don't see any name, Senator, unless it is "Sulli-
van."
The Chairman. "Angelino from Albany."
Mr. Allenberg. The name means nothing to me, Senator.
Mr. Halle Y. That is exhibit No. 59.
(Photograph of George Angersola received in evidence as exhibit
No. 59.)
Mr. Halley. We have a name "George Angersola."
Mr. Allenberg. That is George King.
Mr. Halley. That is George King? It doesn't look like him.
Mr. Allenberg. I know George King. That is none of the brothers
of John King.
The Chairman. Was John King or George King a customer of
yours ?
Mr. Allenberg. George King lived at the AVofford.
The Chairman. And lie is of the so-called Cleveland gang?
Mr. Allenberg. So I am told. Senator.
The Chairman. You know that ; don't you ?
Mr. Allenberg. I don't know it, Senator.
The Chairman. You know all of these men have criminal records as
long as your arm.
Mr. Allenberg. Now we do.
The Chairman. You know it at the time ?
Mr. Allenberg. No; I didn't know it at the time. All that has
come out since then.
The Chairman. He has been in the Boulevard Hotel with you;
hasn't he?
Mr. Allenberg. No, sir.
The Chairman. Whose is the second picture ?
Mr. Allenberg. John King.
The Chairman. Is he a brother?
Mr. Allenberg. Yes, sir.
The Chairman. He is another one of the Cleveland gang; isn't he?
Mr. Allenberg. Yes, sir.
The Chairman. Was he a customer of yours at the Wofford Hotel ?
Mr. Allenberg. John King had an interest in it.
The Chairman. In the Wofford Hotel?
Mr. Allenberg. Yes, sir. That is the same James King as on those
papers.
The Chairman, And he had a criminal record before he had an
interest in the Wofford Hotel?
Mr. Allenberg. I did not know it.
The Chairman. This photograph will be received and made a part
of the record.
(Photograph of John King received in evidence as exhibit No. 60.)
The Chairman. Do you recognize this man ?
Mr. Allenberg. No, sir.
The Chairman. Look at his name.
Mr. Allenberg. I don't recognize him.
The Chairman. What is his name?
Mr. Halley. Romeo Joseph Civatta.
The Chairman. That will be received in evidence and made a part
of the record.
ORGANIZED CRIME IN INTERSTATE COMMERCE 103
(Photograph of Romeo Joseph Civatta received in evidence as
exhibit No. Ol.)
The Chairman. Do you recognize this man ?
Mr. Allenberg. No, sir.
The Chairman. Look at his name on the back and see if you recog-
nize his name.
Mr. Allenberg. No, sir ; I do not.
Mr. Halley. C-i-b-e-t-t-a.
Mr. Allenberg. No, sir.
The Chairman. Look at his name, and see if you recognize that
name.
Mr. Allenberg. No, sir; I do not.
The Chairman. That will be received and made a part of the
record.
(Photograph of Tony L. Cibetta received in evidence as exhibit
No. 62.)
The Chairman. Do you recognize this man? What is his name?
Mr. Allenberg. It is the same — Civetta — Carlo F. Civetta. I don't
know him.
The Chairman. It will be received and made a part of the record.
(Photograph of Carlo F. Civetta received in evidence as exhibit
No. 63.)
The Chairman. Do you recognize this picture ?
Mr. xVllenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. Joseph Di Carlo.
The Chairman. Was he a customer of yours ?
Mr. Allenberg. He was a customer of the hotel, but I don't remem-
ber him ; I remember the name.
The Chairman. How about Civetta?
Mr. xVllenberg. I don't i-emember him.
The Chairman. Was he a customer?
Mr. Allenberg. I don't remember.
The Chairman. This picture will be received in evidence and made
a part of the record.
(Photograph of Joseph Di Carlo received in evidence as exhibit
No. 64.)
The Chairman. How about Sam Di Carlo. Do you recognize his
picture?
Mr. Allenberg. No, sir.
The Chairman. Do you remember his name?
Mr. Allenberg. No, sir.
The Chairman. Was he a guest at the hotel ?
Mr. Allenberc;. When I say I don't remember I mean I don't
remember whether it was Sam or George or what the name was, but 1
remember the name Di Carlo.
The Chairman. That will be received and made a part of the
record.
(Photograph of Sam Di Carlo, alias Toto, received in evidence as
exhibit No. 65.)
The Chairman. Do you recognize this picture?
Mr. Allenberg. Yes; I remember this fellow.
The Chairman. Who is he ?
68958 — 50 — i)t. 1 8
104 lORG'ANIZED C'RtlME! IN INTERSTATE COMMERCE
Mr. Allenberg. His name is Miller. He never lived at the Wof-
ford Hotel.
The Chairman. You have known him here for quite a while ?
Mr. Allenberg. Known of him.
The Chairman. Do you know him personally ?
Mr. Allenberg. I know him to say hello to, but that is all.
The Chairman. Is he a criminal ?
Mr. Allenberg. I don't know, except that I see a mark on here.
The Chairman. That will be received in evidence and made a part
of the record.
(Photograph of Sam Miller received in evidence as exhibit Xo. 66.)
The Chairman. Do you recognize this man 'i
Mr. Allenberg. No, sir.
The Chairman. Fred King.
Mr. Allenberg. That does not look like Fred King ; the one I know.
I know Fred King.
The Chairman. You know Fred King?
Mr. Allenberg. Yes, sir.
The Chairman. That will be received and made a part of the
record.
(Photograph of Fred King received in evidence as exhibit No. 67.)
Mr. Halley. You don't recognize him even after you see the picture ?
Mr. Allenberg. You can see the smile on his face that that is him.
The Chairman. Do you recognize this picture?
Mr. Allenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. I don't know^ him. I know the name by reputation.
The Chairman. Was he a guest at your hotel ?
Mr. Allenberg. No, sir.
The Chairman. And you don't remember him?
Mr. Allenberg. No, sir.
The Chairman. Do you know this man ?
Mr. Allenberg. Yes, sir.
Mr. Halley. The picture of Abraham Zwillman will be No. 68.
(The photograph of Abraham Zwillman received in evidence as
exhibit No. 68.)
Mr. Allenberg. He is a friend of John King's.
The Chairman. Did he stay at the Wofford Hotel?
Mr. Allenberg. I think he stayed at the Wofford, but I am not
sure.
The Chairman. Do you know this man ?
Mr. Allenberg. That is Jack Friedlander, a man with a gambling
reputation.
The Chairman. Where did he come from ?
Mr. Allenberg. I understood he came from Jersey.
The Chairman. Was he a guest at the Wofl'ord Hotel ?
Mr. Allenberg. I don't think so. Senator. I know who he is, but
I don't think he stopped at the Wofford Hotel.
The Chairman. But he is a well known local gambler?
Mr. Allenberg. Yes, sir.
The Chairman. What is his interest in Miami?
Mr. Allenberg. Gambling houses, as far as I know.
The Chairman. That will be received and made a part of the
record.
ORGANIZED CRIME IN INTERSTATE COMMERCE 105
(Photograph of Jack Friedlander received in evidence as exhibit
No. 69.)
]Mr. Halley. Do you know what gambling houses Jack Fried-
lander is in?
Mv. Allenberg. The Island Club — a couple of years.
Mr. Halley. Any others?
Mr. Allenberg. The 86 Club a couple of years ago.
The Chairman. Do you recognize this picture?
INIr. Allenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. Nicholas Delmore.
The Chairman. Did you ever hear of his name ?
Mv. Allenberg. Yes, sir.
The Chairman. Was he a guest of yours at the Wofford Hotel?
]Mr. Allenberg. I don't remember whether he was or not. He is
vague to me.
The Chairman. That will be received and made a part of the
record.
(Photograph of Nicholas Delmore received in evidence as exhibit
No. TO.)
The Chairman. Do you know William ]Mooretti ?
Mr. Allenberg. He stopped at the Wofford Hotel, but I wouldn't
recognize him from this picture; but he stopped there.
Thhe Chairman. Who is he?
Mr. Allenberg. He is from Jersey, too ; supposed to be a gambler
from Jersey.
Tlie Chairman. A part of the so-called Jersey gang or mob?
Mr. Allenberg. The reason I remember his name is he moved from
the Wofford Hotel up to one of the better hotels — the Versailles or
something. I remember the name.
The Chairman. That will be received and made a part of the record.
(Photograph of William Mooretti received in evidence as exhibit
No. 71.)
The Chairman. Do you remember this man?
jNIr. Allenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. No ; I don't remember him at all.
The Chairman. Do you remember that name as being at your hotel ?
Mr. Allenberg. I remember a De Carlo. We had three pictures,
Senator, but I don't remember which one.
The Chairman. That will be received and made a part of the record.
(Photograph of Angelo De Carlo received in evidence as exhibit
No. 72.)
The Chairman. Do you know this person ?
Mr. Allenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. No ; I don't know him. I never saw him.
Tlie Chairman. What is the name on that ?
Mr. Allenberg. Riga.
The Chairman. That will be received and made a part of the record.
(Photograph of William Riga received in evidence as exhibit
No. 73.)
The Chairman. Do you know this person ?
106 lORG'ANIZED CRIME: IN USTTERSTATE COMMERCE
Mr. Allenberg. That is Joe Massei.
The Chairman. Where is he from?
Mr. Allenberg. From Detroit.
The Chairman. Was he a guest at the Wofford Hotel ?
Mr. Allenberg. No, sir.
The Chairman. Where did you know him?
Mr. Ali^nberg. He used to visit King and Carfano and I met him
around there.
Mr. Halley. Is Massei interested in any gambling enterprise in the
Miami vicinity that you know of?
Mr. Allenberg. Only by reputation that I have heard ; Greenacres
is the place I heard.
Mr. Halley. He has a very substantial interest in the so-called big
crap games, doesn't he ?
Mr. Allenberg. I am not sure what it is, but I know he is supposed
to have a substantial interest in Greenacres. He also has a legitimate
business here — the Miami Provision Co.
The Chairman. What is the Miami Provision Co.?
Mr. Allenberg. A meat company.
The Chairman. Is that located on the beach ?
Mr. Allenberg. No ; it is located in Miami.
The Chairman. Does he have an interest, direct or indirect, in the
Wotford Hotel, or did he have?
Mr. Allenberg. Not that I know of.
The Chairman. How about the Boulevard Hotel?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the
record.
(Photograph of Joseph Massei received in evidence as exhibit No.
74.)
The Chairman. Do you know this person?
Mr. Allenberg. No, sir.
The Chairman. Read his name.
Mr. Allenberg. Lefty Clark.
The Chairman. Do you know Bischoff ? (Alias Lefty Clark.)
Mr. Allenberg. Lefty Clark.
Tlie Chairman. Look at him. Do you recognize him ?
Mr. Allenberg. He got fatter, think, since this picture.
The Chairman. Was he a guest at the Wotford Hotel ?
Mr. Allenberg. No, sir.
The Chairman. Where did you know him ?
Mr. Allenberg. I met him around the Wofford Hotel. He never
lived there.
The Chairman. What is his legitimate interest in Miami?
Mr. Allenbeug. I don't know that he has any.
The Chairman. Illegitimate interest?
Mr. Allenberg. Greenacres.
The Chairman. You saw him around the Wofford Hotel?
Mr. Allenberg. I would say that I didn't.
The Chairman. That will be received and made a ])art of the record.
(Photogra])h of AVilliam BisclioH'. alias Lefty Clerk, received in |
evidence as exiiibit No. 75.)
The Chairman. Do you know this person?
Mr. Allenberg. No, sir; I don't know him.
ORGANIZED CRIME IN INTERSTATE COMMERCE 107
The Cpiairmax. Look at his name.
Mr. Allenberg. No, sir; I don't recognize him. Louis Ricciardi.
The Chairman. That will be received and made a part of the record.
(Photograph of Louis Ricciardi received in evidence as exhibit
No. 76.)
The Chairman. Do you know Joe Burnstein?
Mr. Allenberg. No, sir.
The Chairman. Or James Burnett? Do you recognize that pic-
ture?
Mr. Allenberg. I don't recognize it.
The Chairman. Never saw him before ?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the rec-
ord.
(Photograph of Joe Burnstein received in evidence as exhibit No.
77.)
The Chairman. How about Pete Licavoli or Little Pete? Do you
remember him ?
Mr. Allenberg. No, sir.
The Chairman. Look at his name and his aliases.
Mr. Allenberg. I don't know him.
The Chairman. That will be received and made a part of the rec-
ord.
(Photograph of Pete Licavoli received in evidence as exhibit No.
78.)
The Chairman. Do you know Isadore Blumenfield ?
Mr. Allenberg. No, sir ; I do not.
The Chairman. Did you ever see his name before ?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Isadore Blumenfield received in evidence as exliibit
No. 79.)
The Chairman. Do you recognize this person ?
Mr. Allenberg. No, sir.
The Chairman. Look at his name.
Mr. Allenberg. I know the man by name, but I don't even know
him.
The Chairman. Was he a guest at your hotel ?
Mr. Allenberg. No, sir; he never stopped there.
The Chairman. That will be received and made a part of the record.
(Photograph of Martin Francis Guilfoyle received in evidence as
exhibit No. 80.)
The Chairman. How about the Fischetti boys?
Mr. Allenberg. I know them by name.
The Chairman. Did they stop at the Woiford?
Mr. Allenberg. No, sir.
The Chairman. Where did they stop ?
Mr. Allenberg. I don't know.
The Chairman. Did you ever see them in Miami?
Mr. Allenberg. On Twenty-third Street.
The Chairman. Did they ever come to the WofFord Hotel ?
Mr. Allenberg. They have a home here, as I understand it.
The Chairman. You do know them ?
Mr. Allenberg. Yes, sir.
108 ORGANIZED CRIIME IN INTERSTATE COMMERCE
The Chairman. Is this a picture of Charles Fischetti ?
Mr. Allenber(?. Yes, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Charles Fischetti received in evidence as exhibit
No. 81.)
The Chairman. What about Murray Humphrey.
Mr. Allenberg. I don't laiow him. I don't remember him.
The Chairman. Do you know his name ?
Mr. Allenberg. Only from seeing it in the newspapers.
The Chairman. You have never seen him personally ?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Murray Humphrey received in evidence as exhibit
No. 82.)
The Chairman. Do you know this man ?
Mr. Allenberg. He has been in the vicinity on Twenty-fourth
Street.
The Chairman. Where is he from ?
Mr. Allenberg. Either Detroit or Chicago.
The Chairman. Was he a part of the old Capone syndicate?
Mr. Allenberg. I don't know it, except from what I have heard.
The Chairman. That will be received and made a part of the record.
(Photograph of Martin Accardo received in evidence as exhibit
No. 83.)
(Photographs of Max Caldwell and Paul Viela received in evidence
as exhibits Nos. 84 and 85, respectively.)
The Chairman. Do you recognize this picture?
Mr. Allenberg. No, sir.
The Chairman. Ralph Buglio?
Mr. Allenberg. I don't know him.
The Chairman. Was he a guest of the hotel ?
Mr. Allenberg. I would say "No."
The Chairman. This will be received in evidence and made a part
of the record.
(Photograph of Ralph Buglio received in evidence as exhibit
No. 86.)
The Chairman. Willie Heeney ? Do you know him ?
Mr. Allenberg. No, sir ; I do not know him.
The Chairman. That will be received and made a part of the
record.
(Photograph of William Heeney received in evidence as exhibit
No. 87.)
Mr. Allenberg. Is that the same man that might have a liquor
store on Washington Avenue? I don't know him, either, but there
is another man by the name of William Heeney.
The Chairman. Do you know Nig Rosen or Harry Rosen?
Mr. Allenberg. No, sir.
The Chairman. Look at his picture and see if you recognize him.
Mr. Allenberg. No, sir ; I do not recognize him.
The Chairman. Have you ever heard his name ?
Mr. Allenberg. Yes, sir.
The Chairman. Has he ever been a guest of the Wofford Hotel?
Mr. Allenberg. I don't think so.
ORGANIZED CRIME IN INTERSTATE COMMERCE 109
The Chairman. That will be received in evidence and made a part
of the record.
(Photograph of Harry Rosen received in evidence as exhibit No.
88.)
The Chairman. Samuel Hoffman?
Mr. Allenberg. I don't recognize him, either.
The Chairman. That will be received and made a part of the record.
(Photograph of Samuel Hoffman received in evidence as exhibit
No. 89.)
The Chairman. David Glass ?
Mr. Allenberg. I know him.
The Chairman. Where did you know him ?
Mr. Allenberg. He was operating the Grand Hotel. He is in the
hotel business.
The Chairman. Is he still in the hotel business ?
Mr. Allenberg. He is over at the Sands Hotel.
The Chairman. Does he operate the Sands Hotel ?
Mr. Allenberg. I think so.
The Chairman. Where is Rosen from ?
Mr. Allenberg. This is David Glass.
The Chairman. I mean David Glass.
Mr. Allenberg. He is from Philadelphia.
The Chairman. And Rosen is from Philadelphia, too, isn't he?
Mr. Allenberg. That I don't know.
The Chairman. That will be received and made a part of the record.
(Photograph of David Glass received in evidence as exhibit No. 90.)
The Chairman. Do you know Jack Silver ?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
( Photograph of Jack Silver received in evidence as exhibit No. 91.)
The Chairman. Do you know Max Segal ?
INIr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Max Segal received in evidence as exhibit No. 92.)
The Chairman. Do you recognize this picture ?
Mr. Allenberg. No; I don't.
The Chairman. As Frank Russo ?
Mr. Allenberg. No, sir.
The CiiAiR3iAN. That will be received and made a part of the record.
(Photograph of Frank Russo received in evidence as exhibit No. 93.)
The Chairman. Do you know this man's name ?
Mr. Allenberg. No, sir.
Tlie Chairman. Abe Martin, alias Abe Glassman ?
Mr. Allenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Abe Martin received in evidence as exhibit No. 94.)
The Chairman. Do you know John Rosen or Edwin Goldberg or
Irving Greenberg?
Mr. Allenberg. No ; I don't know him.
The Chairman. That will be received and made a part of the record.
(Photograph of John Rosen received in evidence as exhibit No. 95.)
The Chairman. Do you know Nathan Stromberg?
Mr. Allenberg. No, sir.
110 (ORGANIZED CRttMEl IN INTERSTATE COMMERCE
7 'he Chairman. That will be received and made a part of the record.
(Photograph of Nathan Stromberg received in evidence as exhibit
No. 96.)
The Chairman. Do you know Joseph Herman Kriss?
Mr. Allenberg. No, sir.
The Ciiair]\ian. That will be received and made a part of the record.
(Photograph of Joseph Herman Kriss received in evidence as
exhibit No. 97.)
The Chairman. Do you know Tony Narcisi ?
Mr. Aelenberg. No, sir.
The Chairman. That will be received and made a part of the record.
(Photograph of Tony Narcisi received in evidence as Exhibit No.
98.)
The Chairman. Where did the Philadelphia gang stay when they
were down here?
Mr. Allenberg. I don't know, Senator.
The Chairman. At the Sands Hotel ?
Mr. Allenberg. I don't know.
The Chairman. Do you know Frank Matteo ?
Mr. Allenberg. No ; I don't know this fellow.
The Chairman. That will be received and made a j^art of the record.
(Photograph of Frank Matteo received in evidence as Exhibit No.
99.)
The Chairman. Mr. Allenberg, a remarkable number of these peo-
ple who are big-time gamblers and acquaintances of yours stayed at
your hotel.
Mr. Allenberg. I didn't know the reputation of these people until
the last few years, Senator, and they lived there years ago, before any
of us knew of their reputations or had it called to their attention.
The Chairman. You knew what they were doing in your hotel ?
Mr. Allenberg. Well, they
The Chairman. They were gamblers and they made your hotel
their headquarters for their activities.
Mr. Allenberg. I can't say. Senator. I don't know. Some of them
were gamblers, but I didn't know all of them to be gamblers. People
come down here to go to the race tracks every day, anxious to gamble,
and they gamble thousands of dollars at night.
Mr. Halley. Mr. Aallenberg, you were in the Wotford Hotel from
1941 to 1948; is that right?
Mr. Allenberg. Yes, sir.
Mr. Halley. And in the Boulevard Hotel in 1946, 1947, 1948, and
1949?
Mr. Allenberg. Yes. My lease just terminated.
Mr. Halley. When did the lease at the Boulevard Hotel terminate?
Mr. Allenberg. April 1, 1950.
Mr. Halley. Eight up to April 1, 1950, you have continued to
operate the Boulevard Hotel ?
Mr. Allenberg. Yes, sir.
Mr. Halley. And right up to April 1950 various of Erickson's
people stayed at the Boulevard Hotel ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Who were they ?
Mr. Allenbeu(;. Bert Briggs, Cantor, Zeldow^; that is all I can
remember offhand that stayed there this last winter. I wasn't around
ORGANIZED CRIME IN INTERSTATE COMMERCE 111
tlie hotel last winter because I ^Yas over operating the Robert Richter
Hotel.
Mr, H ALLEY. Did they continue to operate their gamblino- from the
Boulevard Hotel up there last winter, as you have previously testified
they did in the past?
Mr. Allenherg. I would say that they have not changed any.
Mr. Halley. As I understand your testimony, Briggs ancl Cantor
in particular would be in charge of the operations within the track?
Mr. Allenbekg. That is right.
Mr. Halley. At what tracks did they operate?
Mr. Allenberg. Any track that happened to be open.
Mv. Halley. At the track they W'Ould take bets from bettors at the
track personally, and they had a method of receiving bets by telephone ?
Mr. Allenberg. They wouldn't receive the bets by telephone in the
race track. That would have to be outside of the track.
Mr. Halley. They had an associate outside of the track?
Mr. Allenberg. Yes.
Mr. Halley. Who reported to them as soon as he got the bet?
Mr. Allenberg. They would hit the machines and make the bet.
That was not done for the purpose of betting with them. That was
for the purpose of putting money into the machines. These bets out-
side the track were sent to the race tracks. That is what they call
comeback money in race tracks.
Mr. Halley. What would be in that for Erickson, taking bets from
the machines? Why would he do that?
Mr. Allenberg. The reason they do that is that comes not from
down here, but from Jersey or wherever else they might be or have
been operating, and if they got big bets from Tom Jones and if Tom
hit, they wanted to reduce tlie size of the bet that they took.
Mr. Halley. They w^oulcl put it in the machine if they didn't want
to book it themselves?
Mr. Allenberg. That is right.
Mr. Halley. Who operated that comeback operation? What in-
dividual ?
Mr. Allenberg. Who did it the last winter, I don't know.
Mr. Halley. Who did it before that ?
Mr. Allenberg, I can't think of his name. The fellow is dead.
He died here last year.
Mr. Halley. One of Erickson's people ?
Mr. Allenberg. Yes, sir.
_ Mr. Halley. Did they also receive bets by telephone from other
cities ?
Mr. Allenberg. Not at the Boulevard Hotel.
Mr. Hallp:y. Where did they receive them?
Mr. Allenberg. That would be in the other office, not down here.
Mr. Halley. You are speaking of the Teepee Grill ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Tell the committee about that.
Mr. Allenberg. I don't know^ anything about the Teepee Grill.
Mr. Halley. You must.
Mr. Allenberg. I am telling you that all I know is that it is in the
nature of a night club. That is all I know of the Teepee Grill. I was
never there in my life. I wouldn't know where it is or anything.
112 ORGANIZED CRIIMEI IN INTERSTATE COMMERCE
Mr. Hallet. There was a very elaborate operation on the floor
above the night ckib of the Teepee Grill and you know about it, I am
sure. I think this : That it is time for you to convince the committee
that you are willing to tell the committee what you know.
Mr. Allenberg. This is the first time I ever knew the Teepee Grill
had anything upstairs over their show place. This is the first time that
I ever heard of it.
Mr. Haleey. Where did the wires come from out of the city for the
booking of bets by telephone ?
Mr. Allenberg. I don't know.
Mr. Halley. You know that they did come in; that bets were
booked and received by phone ?
Mr. Allenberg. There were bets made all over the United States
in different gambling houses.
Mr. Halley. I mean in Miami — the people who stayed at the Boule-
vard Hotel — Briggs, Cantor, and their associates received bets by
telephone, didn't they ?
Mr. Allenberg. Not at the Boulevard Hotel.
Mr. Halley. They received them somewhere.
Mr. Allenberg. I don't know where they received them.
Mr. Halley. You know they received such bets.
Mr. Allenberg. They may have had an office where the telephones
were but I don't know where it was and didn't know anything about it.
Mr. Halley. You know there was such an office.
Mr. Allenberg. There was an office.
Mr. Halley. Where they received telephone bets ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Didn't they report every day to Erickson or his ac-
countant in New York on the results of the day's operations?
Mr. Allenberg. I would say that they did,
Mr. Halley. How did they report ?
Mr. Allenberg. I don't know ; I suppose by telephone or by letter.
Mr. Halley. Wasn't that all done in the Boulevard Hotel ?
Mr. Allenberg. I would assume it was, but I don't know. I would
say "Yes" ; it was done that way.
Mr. Halley. These were all your close friends ?
Mr. Allenberg. Yes, but I didn't do — I don't know how they oper-
ated their business.
Mr. Halley. They didn't shut their doors to you.
Mr. Allenberg. They didn't if I wanted to go in and see what went
on, but I never went in.
Mr. Halley. You knew what was going on?
Mr. Allenberg. They sent their notices, or whatever they had.
Mr. Halley. Many people around the Boulevard knew, so you must
have known, too.
Mr. Allenberg. Of course I knew it was going on, but I didn't
know what they were doing. I don't know what they had and I
didn't know how they handled it.
Mr. Halley. At the end of each day, the men at the track would
come in with their money.
Mr. Allenberg. Yes.
Mr. Halley. And somebody would sit down to total it up, Avouldn't
they?
Mr. Allenberg. Yes, sir.
ORGANIZED CRIME IN INTERSTATE COMMERCE 113
Mr. Hai.ley. And that was done upstairs in the Boulevard Hotel?
Mr. Allenberg. Yes.
Mr. Halley. And the next morning some of the checks went to
the bank to be cashed, didn't they ?
Mr. Allenberg. Yes.
Mr. Halley. Who would do that ?
Mr. Allenberg. I would cash checks for them if they asked me to.
Mr. Halley. Would you endorse the checks ?
Mr. Allenberg. Sometimes. The betting at the race track was
legal. There were mutuel windows where everybody was betting.
It was all mixed up in a situation where people are betting on horses,
and it didn't seem to be anything out of line. Everybody was play-
ing horses or gambling down there or doing one of those kinds of
things. You cTidn't even think of it.
Mr. Halley. You have stated the atmosphere and you have stated
the reasons and also the facts. The committee is not at this moment
sitting in judgment. The committee is sitting to get the facts. If
you want to state as part of the facts how widespread it was, ex-
plain it-
Mr. Allenberg, I can only tell you as much as happened around
the Boulevard Hotel.
Whether there were three or four or five men who would come
back at night and go to their room — and assume for the sake of
the record that they compiled their record of the day there
Mr. Halley. You don't have to assume it. You know it, don't
you?
Mr. Allenberg. Yes; I know it. I never saw them do it, but I
would assume that is what happened.
Mr. Halley. You know it beyond any doubt. There is no doubt
in your mind that that is what they were doing up there, is there ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Did Erickson also receive bets from other bookies
and other gamblers in the nature of lay-offs?
Mr. Allenberg. That would be at the race track.
Mr. Halley. Did he do it ?
Mr. Allenberg. I would say that he did.
Mr. Halley, Who are some of the people who laid off bets with
Erickson ? You can help and I think you should.
Mr. Allenberg. I am telling you from reputation of the fellows
that played horses or books out there, and I would assume those would
be the ones that would bet with him — Max Courtney, fellows like Joe
Boyle — I don't know whether he ever did or not, but I know they are
gamblers. George Scherman was a bookmaker out there, but I don't
know to what extent he might have bet with Erickson. They were
all bookmakers.
Mr. Halley. I would like to turn to another subject for the moment.
What is the Abe Allenberg Contracting organization — H. L. Straus ?
Mr. Allenberg. There is no such thing as an Abe Allenberg Con-
tracting Co. There is a contract between Abe Allenberg and H. L.
Straus.
Mr. Halley. What is that?
Mr. Allenberg. A contract in reference to the sale of the race
track.
114 ORGANIZED CRIME IN INTERSTATT: COMMERCE
Mr. Hallet. What was the price for wliich the race track was sold?
Mr. Allenberg. It was about — a little over a million dollars — and
Erickson had 20 percent of it. There was also — that is the contract
you are talking about, that paid $80,000 to John Patton. Frank
Erickson
Mr. Halley. Who is John Patton ?
Mr. Allenberg. John Patton was one of the owners of the Gables
Racing Association stock.
Mr. Hallet. He was in with Erickson in this Gables Eacing
Association ?
Mr. Allenberg. Yes, sir.
Mr. Halley. He represented the Capone syndicate, didn't he?
Mr. Allenberg. I couldn't say that.
Mr. Halley. He comes from Chicago?
Mr. Allenberg. Yes.
Mr. Halley. Wasn't he one of Capone's men ?
Mr. Allenberg. I don't know. I wouldn't say that he was.
Mr. Halley. Would you say that he wasn't ?
Mr. Allenberg. I would snj he wasn't because I happen to know
the man.
Mr. Halley. When did you last hear from Patton?
Mr. Allenberg. I heard from Patton yesterday.
Mr. Halley. Did you get a letter from him ?
Mr. Allenberg. Yes, sir.
Mr. Halley. In what connection ?
Mr. Allenberg. In reference to this contract. The balance of the
payment was made, and I didn't have the contract and I didn't know
where it was. The lawyers in Baltimore prepared the assignment.
The contract is in my name, and when the assignment is executed
either the check is made to me and I endorse it over to Patton as his
money — that must be the contract with Straus.
Mr. Halley. Were you paid a commission in connection with the
sale of Tropical Park?
Mr. Allenberg. This is the commission.
Mr. Halley. $36,000?
Mr. Allenberg. No; it was $80,000 all togethei-, and Patton got
$16 — Erickson and Patton got $80,000, and they got paid in propor-
tion of 20 to 36. In other words. Erickson got five-ninths and Patton
got four-ninths.
Mr. Halley. Did you ever get any part of it from Erickson ?
Mr. Allenberg. No, sir.
Mr. Halley. You were still on salary ?
Mr. Allenberg. Yes, sir.
Mr. Halley. What is the American Totalisator Co. ?
Mr. Allenberg. They are the people that were associated with
the purchase of this (rabies Racing Association stock.
Mr. Halley. Who are those ]:)eeple?
Mr. Allenberg. Gurney Monks, liis brother: H. L. Straus. Straus
is dead. Thei'c were two otlier partners, and I have to deliver
their
Mr. Halley. Tliat is the conclusion of the Gables transaction ?
Mr. Allenberg. That is the last of the Gables transaction that I
have anything to do with. It terminates Avith this.
ORGANIZED CRIME IN INTERSTATE COMMERCE 115
]Mr. Hallky. Did you have a tradiiiof authorization for Frank
Erickson here in Miami to trade at any stock-brokerage housed
Mr. ALLENBERci. I never traded for him.
Mr. Halleyn Did you have an authorization to do it^
Mr. Allenberg. I may have had. I don't remember.
]Mr. Halley. Did you have a power of attorney from Erickson?
Mr. Allenberg. 1 don't remember, Mr. Halley, if I did.
Mr. Halley. How did Erickson hapi)en to invest in the Colonial
Inn? Did that happen after you came down here lepresenting him?
Mr. Allenberg. Yes, sir.
Mr. Halle;y. In what year did he go into the Colonial Inn?
Mr. Allenberg. I would say that he Avent into the Colonial Inn
when Ben Marden owned it.
Mr. Halley. AVhen was that ?
Mr. Allenberg. Not too many years ago.
Mr, Halley. Before the wari'
Mr. Allenberg. Yes, sir. I would say before the war.
Mr. Halley. Long before the war or just before the war; aronnd
1940, would you say ?
Mr. Allenberg. I am trying to — I think he had an interest — it is a
matter of record.
Mr. Halley. After you were in Tropical Park?
Mr. Allenberg. Yes, sir.
Mv. Halley. And before you sold out of Tropical Park; is that
right ?
Mr. Allenberg. That I don't remember.
Mr. Halley. Under what circumstances did Erickson go into the
Colonial Inn ?
Mr. Allenberg. That I don't know. I had nothing to do with
that.
Mr. Halley. Did Briggs have a part of Colonial Inn?
Mv. Allenberg. That I don't know, except what I have seen in the
records that have come out. I don't know" otherwise.
Mr. Halley. Would it be your judgment that Briggs' interest was
his own or was he simply holding it for Erickson, knowing the rela-
tion between the men ?
Mr. Allenberg. It would seem to me that Briggs would be on a sal-
ary basis for that, as far as I can see.
Mr. Halley. And if he held an interest he held it as a trustee for
Erickson ?
Mr. Allenberg. I would imagine that might be the case. That is
my supposition, the same as yours.
Mr. Halley. Adonis was in that, too, wasn't he?
Mr. Allenberg. I don't know. I have heard that he w^as.
Mr. Halley. And Lansky?
Mr. Allenberg. Yes, sir.
Mr. Halley. And Litteral ?
Mr. Allenberg. Litteral? I haven't heard he was.
Mr. Halley. Alo?
Mr. Allenberc;. I don't know. I haven't even heard about him.
Mr. Halley. Was Erickson also in Greenacres?
Mr. Allenberg. I think that Greenacres and Colonial Inn, as I
knew\ was one operation. I don't know whether it was true or not.
Mr. Halley. Is that also true of Club Boheme?
116 ORGANIZED CRIME', IN INTERSTATE COMMERCE
Mr. Allenberg. Yes. I am saying not that I know anything of my
own knowledge. I am saying what my supposition is.
Mr. Halley. How do these fellows operate here openly, Mr. Allen-
berg? Do they pay off the authorities?
Mr. Allenberg. Your guess is as good as mine. I haven't any more
right to my opinion than anybody else has.
Mr. Halley. The sheriff doesn't interfere with these operations,
does he ?
Mr. Allenberg. No.
Mr. Halley. Nor does the chief of police ?
Mr. Allenberg. No. That doesn't necessarily mean always that
they would be paid off.
Mr. Halley. The mayor doesn't interfere either ?
Mr. Allenberg. No.
Mr. Halley. Do you know all of these gentlemen personally ?
Mr. Allenberg. Most of them.
Mr. Halley. Do you have any doubt that they know that this
gambling goes on openly all over the county ?
Mr. Allenberg. I would say they would have no doubt about the
fact that it was going on.
Mr. Halley. They would have to be blind ?
Mr. Allenberg. Yes.
Mr. Halley. It goes on in the open in practically every hotel?
Every hotel has a book ?
Mr. Allenberg. Yes ; except my hotel.
Mr. Halley. The Robert Richter does not ?
Mr. Allenberg. It did not have it under my operation.
Mr. Halley. Will you state as a fact that the Robert Richter did
not have a book?
Mr. Allenberg. That is right.
Mr. Halley. Did the Boulevard have a book ?
Mr. Allenberg. No, sir.
Mr. Halley. How about the Wofford ?
Mr. Allenberg. The Wofford had no book when I was there.
Mr. Halley. Didn't the Wofford originally have a set-up for
gambling ?
Mr. Allenberg. No, sir. That was a figment of somebody's imagi-
nation. The sheriff came over there with the patrol wagon on the
theory that the whole top floor was a gambling house. Tliere wasn't
anything there. There were people living there.
Mr. Halley. Just before Erickson decided to go to the Colonial
Inn, wasn't it held to be a fact that the Wofford M\as being used for '
gambling?
Mr. Allenberg. No, sir.
Mr. Halley. Isn't that why he originally financed the purchase
for you ?
Mr. Allenberg. There is not the slightest truth in that.
Mr. Halley. Did you ever see any gambling equipment in the hotel ?
Mr. Allenberg. No, sir ; I never did.
Mr. Halley. Even when you first went into it ?
Mr. Allenberg. No, sir. Tliose fellows used to go upstairs and
used to play cards for very heavy stakes, such as poker or gin, but
they played for big money.
ORGANIZED CRIME IN INTERSTATE COMMERCE 117
Mr. Halley. How do you explain the fact that the officials do not
interfere with these operations? p ,. • i . ^i
Mr Allenberg. There must be some kind of political set-up they
are attached to. They might put money into the campaign funds or
something. , , ^ • i i i
The Chairman. Well, Mr. Allenberg, you have done considerable
fixing yourself , haven't you ?
Mr. Allenberg. No, sir, Senator ; I have not done any hxmg. i hat
is not m • ^r)
The Chairman. You never fixed up a public otlicial '.
Mr. Allenberg. No, sir; I have not.
The Chairman. This John Patton that you referred to m your
records a few minutes ago as owning part of Tropical Park race track
with Erickson — is that correct?
Mr. Allenberg. Yes, sir. -,■ . j- r^i-
The Ch\irman. Wasn't he one of the Capone syndicate from Uhi-
cao-o^ Isn't that the man with a criminal record from Chicago?
Mr. Allenberg. I do know that he has a criminal record, Senator.
The Chairman. He is a notorious gambler in this section of the
^°Mi\ Allenberg. I don't know whether he is notorious as a gambler.
He is notorious in having his name linked with Capone.
The Chairman. He still has a home at the beach ?
Mr. Allenberg. Yes, sir. , o
The Chairman. What other interests does he have here ( ^
Mr. Allenberg. He is associated with the :Miami Beach Kennel
Club — he or his son. i . , -a
The Chairman. I see here that you got to be honorary deputy sheriti
of Dade County.
Mr. Allenberg. Yes, sir.
The Chairman. Is that from Jimmy Sullivan?
Mr. Allenberg. He is the sheriff of Dade County ; yes, sir.
The Chairman. I have a card here showing that you are an honorary
member. That will be filed as an exhibit. .
(Card showing Abe Allenberg honorary deputy sheriff received m
evidence as exhibit No. 100. See appendix, p. 732. )
Mr. Allenberg. I asked him for the card.
The Chairman. Did he know about your association with all these
gamblers or criminals ? , , • i i j
Mr. Allenberg. I know more people that have unblemished records
among those I happened to have known years ago and with whom I
have been associated, but they didn't have records at that time.
The Chairman. Did you ask Jimmy Sullivan to make you a deputy
sheriff?
Mr. Allenberg. Yes, sir.
The Chairman. Your friendship wath him has been rather close
for over quite some period of time ?
Mr. Allenberg. I have known him pretty well.
The Chairman. And have always supported him in all of his elec-
tions ?
Mr. Allenberg. Yes, sir.
The Chairman. How long have you know him ?
Mr. Allenberg. 'Since he ran for sheriff the first time.
The Chairman. How long has that been ?
118 lORGANIZED CRIME: IN INTERvSTATE C'0]VIMERCE
Mr, Allenberg. Eight years ago.
The Chairman. Who is the chief of police at Miami Beach?
Mr. Allenberg. Albert Simpson.
The Chairman. Are you pretty close with him ?
Mr. Allenberg. Yes, sir; I know him pretty well. When I say
"close," I mean I know him.
The Chairman. And you supported him in his election ?
Mr. Allenberg. Simpson? No, sir. They are not elected. They
are appointed.
The Chairman. How about the mayor ?
Mr. Allenberg. I didn't take any part in the mayor's election.
The Chairman. Who is the mayor ?
Mr. Allenberg. The mayor is Harold Turk.
The Chairman, Do you know him well ?
Mr. Allenberg. Yes, sir.
The Chairman. You had the Florida Sheriffs' Association out at
your hotel, didn't you ?
Mr. Allenberg. Yes, sir.
The Chairman. And you had a special card to the Florida Sheriffs'
Association in 1948 ^
Mr. Allenberg. Yes, sir.
The Chairman. That will be filed as an exhibit.
(Courtesy card, Florida Sheriffs' Association, Abe Allenberg,
received in evidence as exhibit No. 101, See appendix, p. 733.)
Mr. xVllenberg. The Florida sheriffs go to different cities for their
convention.
The Chairman. What isthis paper ?
Mr. Allenberg. This letter is apparently a copy of a letter
The Chairman. Which you wrote to the Miami Beach Kennel Club
dated June 15, 1941:.
Will you read the letter? It is very short.
Mr. Allenberg. When they had the convention they stayed at the
Wofford Hotel June 12 and 13, and this was for the rooms they occu-
pied there.
The Chairman. This Mr. Johnston in this letter is the man who
owns a number of dog tracks around here ?
Mr. Allenberg. Yes, sir.
The Chairman. And does he have this Kennel Club to whom this
letter is addressed?
Mr. Allenberg. He is associated with it.
The Chairman. Why did you send it to that Kennel Club ?
Mr, Allenberg, That was his address.
The Chairman. The letter is addressed to the Kennel Club, isn't
it?
Mr. Allenberg. That is correct. He might have told me to send the
bill to the Kennel Club.
The Chairman. Let tliat be filed as an exhibit.
(Letter to Miami Beach Kennel Chib re Wofford Hotel bill received
in evidence as exhibit No. 102. See appendix, p. 733. )
The Chairman. Who is Jim Ponzio?
Mr. Allenberg. A restaurant man from New York, a personal
friend of mine. He has never been down here.
The Chair^nian. Is he in a racket ?
Mr. Allenberg. No ; he has a diner.
ORGANIZED CRIME IN INTERSTATE COMMERCE 119
The Chairman. And this is a letter that you received from him?
Mr. Allenberg. Yes, sir. These people were making a diner for
him and there was trouble with the electrical work and they had to try
to have somebody fix it up for him.
The Chairman. Let us mark this as "Exhibit No. 103."
(Letter from Jim Ponzio to Abe Allenberg dated September 27,
1948, received in evidence as exhibit No. 103. See appendix, p. 734.)
The Chairman. In this letter it says :
They are having difficulty with the electrical inspectors due chiefly to wiring.
We encounter this from time to time and a few dollars will fix everything up.
However, the chief electrical inspector's name in INIiami is Knox and his assist-
ant's name is Couseu. If you will contact these two men personally or have
your emissary in Miami take care of them and see that the thing is accepted,
it would help things a great deal.
Mr. Allenberg. It was not taken care of.
The Chairman. Who is your emissary in Miami?
Mr. Allenberg. I guess he means some of my political friends that
I have around that might be able to see the thing was properly
straightened out.
The Chairman. You get things fixed up with your political friends?
Mr. Allenberg. There might be a favor once in a while. It is not
a question of fixing.
The Chairman. He says, "P. S. I understand Senator Pepper is
the man to give the O. K."
Mr. Allenberg. Pepper didn't know anything about it.
The Chairman. Did you ask Senator Pepper about this ?
Mr. Allenberg. No, sir.
The Chairman. How did he understand that?
Mr. Allenberg. Maybe Kullman, the people who built the diner,
told them that. They just used the man's name and didn't know what
they were talking about.
The Chairman. You apparently contributed $2,500 to the Demo-
cratic National Committee on March 31, 1947; is that correct?
Mr. Allenberg. I sold 10 tickets to the National Democratic Com-
mittee to Frank Erickson.
The Chairman. You sold 10 tickets?
Mr. Allenberg. Yes, sir ; I sold 10 tickets.
The Chairman. Where was the dinner?
Mr. Allenberg. Honey Plaza Hotel.
The Chairman. Is that what that $2,500 is for ?
Mr. Allenberg. Yes, sir.
The Chairman. What favor were you trying to get out of the Demo-
cratic National Committee?
Mr. Allenberg. Nothing in particular.
The Chairman. Let's make that a part of the record.
(Letter dated May 6, 1947, from George M. Killion, received in
evidence as exhibit No. 104. See appendix, p. 734.)
Mr. Allenberg. There was a lot money raised down here.
Senator.
The Chairman. Did Frank Erickson attend the dinner ?
Mr. Allenberg. Yes, sir.
The Chairman. Did you attend the dinner?
Mr. Allenberg. Yes, sir.
The Chairman. Did Frank Costello attend the dinner?
Mr. Allenberg. I don't think so.
68958— 50— pt. 1 9
120 ORGANIZED ORlIMEl IN INTE'RSTATE COMMERCE
The Chairman. Who was the principal speaker at the dinner?
Mr. Allenberg. I don't remember.
The Chairman. Did you contribute anything to the Kepublican
National Committee?
Mr. Allenberg. No, sir. They didn't have any dinner.
The Chairman. Have you contributed to the Kepublican National
Committee ?
Mr. Allenberg. No, sir.
The Chairman. Only the Democratic?
Mr. Allenberg. Yes, sir. It happened to be one of those things
that came along and there was a great hurrah made about it.
The Chairman. Why didn't Frank Erickson buy anything in his
own name ?
Mr. Allenberg. I was the one that sold it.
The Chair]man. You were the seller of the tickets ?
Mr. Allenberg. Yes, sir.
The Chairman. Who got you to sell the tickets? Who spoke to
you about it ?
Mr. Allenberg. A. C. Carrara, of the Democratic national treas-
urer's office.
The Chairman. And he wrote you and asked you to sell some
tickets ?
Mr. Allenberg. He was doAvn here.
The Chairman. Did he stay at the Wofford Hotel?
jMr. Allenberg. I don't think so.
The Chairman. Who is Ralph or Raphael W. Alpher?
Mr. Allenberg. He was a lawyer in New York.
The Chairman. Here is a letter from Ralph W. Alpher dated
August 4, 1948. He signed it "Ralph'' so he must be a good friend
of yours.
Mr. Allenberg. Yes, sir.
The Chairman. Let's make that letter an exhibit.
(Letter dated August 4, 1948, signed "Ralph" received in evidence
as exhibit No. 105. See appendix, p. 734.)
The Chairman. Who is the Mr. Perlman or Pearlberg mentioned
in this letter ?
Mr. Allenberg. He is a man that lives here in town.
The Chairman. What is his first name ?
Mr. Allenberg. Jack.
The Chairman. He talks about a contact with the Governor-elect.
Is that Warren ?
ISIr. Allenberg. Yes, sir.
The Chairman. Did you investigate this matter and find out
about it ?
Mr. Allenberg. No, sir ; I did not.
The Chairman. What is your association with Mr. Warren ?
Mr. Allenberg. I know Mr. Warren very well.
The Chairman. Did you contribute to his campaign?
Mr. Allenberg. No, sir; I did not, except in a very small way;
maybe a couple of hundred dollars.
The Chairman. In Tennessee a couple of hundred dollars is a pretty
substantial contribution. How mucli did you contribute to Governor
Warren's campaign ?
Mr. Allenberg. About $300.
ORGANIZED CRIME IN INTERSTATE COMMERCE 121
The Chairman. Do you want to think about that again?
Mr. Allenberg. No, sir.
The Chairman. Who did you contribute it through?
Mr. Allenberg. Through myself.
The Chairman.- Who did you contribute it through ? To whom did
you give it?
Mr. Allenberg. It went out as expenses. I bought signs.
The Chairman. You just gave $300 and you paid for signs and
things of that sort?
Mr. Allenberg. Yes, sir.
The Chairman. Did you send something to his campaign manager
here in Dade County ?
Mr. Allenberg. No, sir ; because I helped campaign myself over on
the Beach.
The Chairman. You were a part of the management yourself ?
Mr. Allenberg. Yes, sir.
The Chairman. Did you collect money for him ?
Mr. Allenberg. Yes, sir.
The Chairman. How much did you collect ?
Mr. Allenberg. $5-, $6- or $8,000. I just don't remember offhand.
The Chairman. There is quite a difference between $5,000 and
$8,000.
Mr. Allenberg. I know, but I haven't computed it, Senator. I
never figured it.
The Chairman. Do you still have your records ?
Mr. Allenberg. Yes ; I have some of the records here.
The Chairman. To whom did you turn that over ?
Mr. Allenberg. That went to the expenses of the campaign.
The Chairman. Were you his manager over on the Beach?
Mr. Allenberg. No, sir ; I was the treasurer.
The Chairman. How about Frank Erickson? Did he contribute,
too?
Mr. Allenberg. No, sir ; he had nothing to do with it.
The Chairman. How about Little Augie ?
Mr. Allenberg. Nothing.
The Chairman. Or any other gamblers. . Did you get any money
out of them ?
Mr. Allenberg. Never got any money from any of those fellows.
Whatever it is, I have a record of it here.
The Chairman. Mr. Allenberg, how old are you ?
Mr. Allenberg. I will be 59 on the 25th of October.
The Chairman. Are you married?
Mr. Allenberg. Yes, sir.
The Chairman. How much family do you have ?
Mr. Allenberg. Wife and two children.
The Chairman. Where were you born?
Mr. Allenberg. Portland, Oreg.
The Chairman. Did you go to school out there ?
Mr. Allenberg. No, sir. I went to school in New York.
The Chairman. You and your family moved to New York?
Mr. Allenberg. Yes, sir.
The Chairman. You are a lawyer?
Mr. Allenberg. Yes, sir.
The Chairman. ^-NHiere did you study law ?
122 ORGANIZED CHIMEi IN INTERSTATE COMMERCE
Mr. Allenberg. New York Law School.
The Chairman. Where did you practice in New York ?
Mr. Allenberg. I practiced at 115 Broadway and 165 Broadway.
The Chairman. Who did you practice with at 115 Broadway?
Mr. Allenberg. House, Grossman, and Vorhouse.
The Chairman. And at 165 Broadway?
Mr. Allenberg. By myself, and at 1482 Broadway I practiced by
myself. That is up at Forty-second Street.
The Chairman. And you represented Erickson when you were in
New York?
Mr. Allenberg. Yes, sir.
The Chairman. How long did you represent him up there?
Mr. Allenberg. About 2 years, I think.
The Chairman. How about these other people that stayed at your
hotel from New York, part of the so-called New York syndicate or
gang?
Mr. Allenberg. Senator, I never represented any of them.
The Chairman. What difficulty was it that you got into in the
practice of law?
Mr. Allenberg. I didn't get into any difficulties.
The Chairman. You didn't?
Mr. Allenberg. No, sir.
The Chairman. Are you still a member of the New York Bar?
Mr. Allenberg. Yes, sir.
The Chairman. Didn't have any disbarment proceedings?
Mr. Allenberg. No, sir.
The Chairman. And did you have a successful practice when you
came down here?
Mr. Allenberg. Fair.
The Chairman. Erickson got you to come down ?
Mr. Allenberg. I came down here representing him; yes, sir.
The Chairman. And you just pulled up from the law practice?
Mr. Allenberg. It didn't just come about that way. When I came
down here, it was part of the agreement that somebody was to counter-
sign the checks of the company until the mortgage was paid back,
and he asked me if I was agreeable to staying down here for a few
months, and the first thing I knew I took over the handling of all
the business of the track, so it didn't take long until I was manager
of the race track, and after everything else, I decided to stay down
here.
The Chairman. Wouldn't you consider yourself in this situation;
that you are kind of a front for the gang ever since that time?
Mr. Allenberg. I never tliought so, Senator.
The Chairman. In other words, when they want to have some
operations come in in Miami or Miami Beach or in tliis part of Florida,
you get things arranged for them and you are the one they get in
touch with?
Mr. Allenberg. No, sir ; that is not so.
The Chairman. How do you account for the fact that so many of
these people stayed at your hotel and when you went to another hotel
they moved with you?
Mr. Allenberg. Not so many. Only the men in association with
Erickson came to my hotel. Nobody else came, and at the Hotel
ORGANIZED CRIME IN INTERSTATE COMMERCE 123
WofFord they cam« there because of those fellows that were there —
King and Carf ano — that is why they came there.
The CiiAiRMAX. You didn't know King was a criminal when you
went into partnership with him?
Mr. Allenberg. No, sir; I did not.
The Chairman. When you found out, did you terminate the
partnership ?
Mr. Allenberg. As soon as I could ; I did.
The Chairman. It had been well known for quite some time,
hadn't it?
Mr. Allenberg. Not generally ; no.
The Chairman. He was a pretty big criminal ?
Mr. Allenberg. No, sir. This is 1945-46 when I got out of the
Wofford Hotel.
The Chairman. When Erickson made his first trip to Florida, he
looked around and guided these people to you for you were his lawyer
and he wouldn't leave them in the dark.
Mr. Allenberg. These men didn't all come in there at once. They
lived there at different times in the season. Maybe in February there
might be 10 or 15. King was supposed to have had a good reputation
so far as I was concerned, from the inquiries I made about him.
The Chairjvian. Where did you make those inquiries? Did you
ask Erickson if he had heard of King ?
Mr. Allenberg. I didn't know King when I went there.
The Chairman. When did you first learn who he was?
Mr. Allenberg. I didn't learn anything about King until maybe
a couple of years ago and these gentlemen started to make revelations
about him.
The Chairman. Didn't you know these people were all racketeers?
Mr. Allenberg. No, sir. I knew they were in the gambling busi-
ness, but I didn't know they were racketeers.
The Chairman. You think it was just a coincidence, then, that they
all gathered at the Boulevard Hotel ?
Mr. Allenberg. They didn't gather in the Boulevard Hotel. You
mean the Wofford.
The Chairman. I mean the Wofford Hotel.
Mr. Allenberg. It is not a coincidence. They were drawn there
by those other two men that I was associated with, and that I didn't
know.
The Chairman. You knew that they all gambled up there together
for tremendous stakes, didn't you ?
Mr. Allenberg. Occasionally, they would.
The Chairman. How much would the stakes be in those games ?
Mr. Allenberg. Senator, it might run from $500 to $5,000. I
never saw a game that went on up there. I never went into a room.
The Chairman. Was that poker ?
Mr. Allenberg. It could be poker or gin.
The Chairman. All bunched around there ?
Mr. Allenberg. Erickson didn't stay around there.
The Chairman. "Wlio were some of the boys ?
Mr. Allenberg. Carfano, King, and some of these other fellows
whose names and pictures you have there.
The Chairman. Did Aclonis hang around ?
Mr. Allenberg. Not much ; only occasionally.
124 lORGANIZED CRlIME IN INTEHSTATE COMMERCE
The Chairman. Did you have a special room for him ?
Mr. Allenberg. No, sir ; we did not.
The Chairman. Massei ?
Mr. Allenberg. He never lived at the hotel.
The Chairman. Did he come to see the boys ?
Mr. Allenberg, Once in a while he would come around.
The Chairman. Mr. Halley ?
Mr. Halley. Do you know that Massei is running the dope racket
i n Miami ? Did you ever hear that ?
Mr. Allenberg. No, sir ; I never heard it. I don't know that there
is any dope racket in Miami or Miami Beach.
Mr. Halley. There is dope sold in Miami ?
Mr. Allenberg. If there is I don't know it.
Mr. Halley. You don't Imow Massei has anything to do with it ?
Mr. Allenberg. No, sir ; I don't.
The ChAirman. Who all have we got in these games ?
Mr. Allenberg. I am just surmising, telling you the fellows that
sat around.
The Chairman. Let's see. "We first have Massei, Carfano, who
else?
Mr. Allenberg. King.
The Chairman. Wlio else?
Mr. Allenberg. I don't know, Senator, who might play cards.
The Chairman. Joe Adonis ?
Mr. Allenberg. No, he was not around the hotel.
The Chairman. Let's get some more names in those big games.
You would know who was in them. Was Erickson ?
Mr. Allenberg. No, sir ; he never played with those men. He was
not friendly with those men.
The Chairman. Who was his auditor ?
Mr. Allenberg. They didn't gamble at cards. These men that I
have identified
The Chairman. Of the people you say were guests at your hotel,
would most of them play in the games?
Mr. Allenberg. I imagine most of them would gamble.
The Chairman. Do you know that?
Mr. Allenberg. I don't know. That was my supposition.
The Chairman. That is all from me right now.
Mr. Halley. May I ask one question : Do you know Bill Johnston ?
Mr. Allenberg. Yes, sir.
Mr. Halley. He just left Miami and is reported to have gone to
Europe ; do you know that ?
Mr. Allenberg. Yes, sir.
Mr. Halley. He is reported to have been quite a fixer; did you
ever know that ?
Mr. Allenberg. No, sir.
Mr. Halley. It is stated that he is the man who had arranged the
games that were run without being shut down. Had you ever heard
that?
Mr. Allenberg. No, sir.
Mr. Halley. Not even by reputation ?
Mr. Allenberg. No, sir.
Mr. Halley. Did you ever give a party or dinner at which A. C.
Caraway and Bill Johnston and a lot of other people were enter-
ORGANIZED CRIME; IN INTERSTATE COMMERCE 125
tainecl by you ? Also by Straus, J. D. Thornton, possibly in connec-
tion with that Democratic dinner ?
Mr. Allenberg, Might have, but I don't remember. I don't recall.
Mr. Halley. Will this memorandum refresh your recollections ?
Mr. Allenberg. These are just people that I was to see. I was on
a trip. This man was in Detroit and I was going to Detroit. These
are names of people I know.
E. E. Hoff is an automobile dealer. H. L. Straus was in Baltimore,
and Caraway — I might want to drop them postal cards or might want
to stop and see them or get in touch with them when I get away.
Mr. Halley. Who did you call on when you got to New Orleans ?
Mr. Allenberg. I have never been in New Orleans for more than 2
-days in my life.
The Chairman. Who did you call on there ?
Mr. Allenberg. The Roosevelt Hotel.
The Chairman. What did you go over there for ?
Mr. Allenberg. I was on my way to California, driving through.
The Chairman. You didn't go to New Orleans and come back here
and then go on to New York on one occasion ?
Mr. Allenberg. No, sir.
The Chairman. Do you know the gambling interests in New
Orleans ?
Mr. Allenberg. I have heard about it.
The Chairman. Do you know any of them ?
Mr. Allenberg. Kastel and Costello were supposed to be there.
The Chairman. Do you know Phil Kastel ?
Mr. Allenberg. Yes, sir.
The Chairman. Where did you know him ?
Mr. Allenberg. He used to come to the Wofford Hotel.
The Chairman. Did you see him when you were in New Orleans ?
Mr. Allenberg. I went there the night I was there and there was
once I saw him. I was there two or three, but I didn't see him. I
didn't see him there. I went to the club.
The Chairman. Does he see you when he comes here ?
Mr. Allenberg. I haven't seen liim in years.
The Chairman. Do you know Mickey Cohen ?
Mr. Allenberg. No, sir.
The Chairman. Is there anything else, Mr. Halley ?
Mr, Halley. I have nothing further.
The Chairman. That is all, Mr. Allenberg.
Mr. Allenberg. I want you to know that I have never been in any
•difficulties and I am not the man they come to in this area to do any
fixing or for any gambling. I don't gamble myself.
The Chairman. The record shows what it shows.
Mr. Allenberg. These people stopped at my hotel.
The Chairman. And they are some of the people you have described
to the committee.
I would say offhand that the people you have been associating with
make a pretty bad appearance.
Mr. Allenberg. It is bad, but I didn't know their reputations.
The Chairman. You know their reputations now, don't you?
Mr. Allenberg. Yes, sir. For instance, you told me about the
Teepee Grill
126 ORGANIZED CRIIMEI IN INTERSTATE COMMERCE
The Chairman. We are very anxious to see whether there is any
improvement in the situation down here.
1 want to say frankly that I think a good deal of the distress here
is of the kind that you have aided and abetted and you have been a
pretty close cog in the wheels of a good deal of it.
What is going to happen in the future is going to be a matter of a
great deal of interest.
That is all. Thank you.
TESTIMONY OF WALTER CLARK, SHERIFF, BROWARD
COUNTY, FLA.
The Chairman. Do you solemnly swear that the testimony that you
will give the committee will be the truth, the whole truth and nothing
but the truth, so help you God ?
Mr. Clark. I do.
The Chairman. I have one or two preliminary questions I want
to ask, Sheriff Clark.
What is your first name ?
Mr. Clark. Walter.
The Chairman. And you live at Fort Lauderdale ?
Mr. Clark. Yes, sir.
The Chairman. Is that Broward County ?
Mr. Clark. Yes, sir.
The Chairman. How old are you. Sheriff?
Mr. Clark. I am 46.
The Chairman. When were you first elected sheriff ?
Mr. Clark. In 1932.
The Chairman. In 1932?
Mr. Clark. I was elected to the State office in 1933.
The Chairman. You have been sheriff how often since that time ?
Mr. Clark. All the time.
The Chairman. Ever since 1933 ?
Mr. Clark. Yes, sir.
The Chairman. What did you do before you were the sheriff?
Mr, Clark. I was in the meat business ; in the grocery business.
The Chairman. Sheriff, under the laws of Florida, in connection
with illegitimate or illegal gaming and operations outside of the law,
what is the law of Florida about your duties as to closing them up?
Do you have to wait until you get a notice or complaint, or is it your
responsibility to go out and do something about it on your own ?
Mr. Clark. If we have a complaint or anything like that, we are
supposed to look after it.
The Chairman. In the absence of complaints, if you know or have
reason to believe that certain transactions are taking place that are
illegal, is it your duty to do it?
Mr. Clark. Yes, sir.
The Chairman. Sheriff, we have abundant testimony that over a
period of quite a number of years numbers of places have been oper-
ating openly in your county ?
Mr. Clark. Yes, sir.
The Chairman. And they are being operated by i>eople who are
operating in interstate commerce by bookmaking and laying off bets;
ORGANIZED CRIME IN INTERSTATE COMMERCE 127
certain members of gangs who have come down and are operating in
vour county. Have you had knowledge of those matters 2
Mr. Clark. I haven't had any knowledge of any gambling.
The Chairman. I mean of gambling operations.
Mr. Clark. I have no knowledge of that.
The Chairman. Is the Colonial Inn in your county ?
Mr. Clark. Yes, sir.
The Chairman. Is that operating now ?
Mr. Clark. No, sir.
The Chairman. Is Greenacres operating?
Mr. Clark. No, sir.
The Chairman. How long did it operate?
Mr. Clark. They operated some several seasons.
The Chairman. Does the record show about when Greenacres
operated?
Mr. Halley. Greenacres operated up to about 1947 ; didn't it ? Is it
operating today ?
Mr. Ci.ark. No.
The Chairman. Did it close down when the season was over?
Mr. Clark. Yes, sir.
The Chairman. Sheriff, our question is : If Greenacres operated last
season, the season before, and the season before and prior to that time,
and if Colonial Inn operated, how come you let them operate?
Mr. Clark. I was elected on the liberal ticket, and the people want it
and they enjoy it.
The Chairman. So, you just nod your head or wink your eyes at
them ?
Mr. Clark. I let them have what they want for the tourists down
here.
Mr. Halley. What do you mean by the "liberal ticket"? Did it
say on the ballot that you were going to allow gambling to go on ?
Mr. Clark. No.
Mr. Halley. Who are the people that wanted the gambling ? What
do you mean by that?
Mr. Clark. The majority of the people expressed their opinions.
Mr. Halley. How did they know that yours was a liberal ticket?
Don't you think they may have thought that you were going to run an
honest administration and stop things that were against the law?
How did the majority of the people know that yours was the liberal
ticket ? Did you go around in your campaigns and tell everybody you
were for open gambling?
Mr. Clark. No, sir.
Mr. Halley. What do you mean by being elected on a liberal ticket.
I think that kind of answer is an insult to the committee.
Mr. Clark. The people know that I am more or less liberal-minded.
Mr. Halley. What people know it? Do the people who have a job
and work and pay taxes and who don't go to expensive gambling
houses know it ?
Mr. Clark. Yes, sir.
Mr. Halley. How do they know it? Do you advertise that you
don't enforce the law?
Mr. Clark. I don't do that.
Mr. Halley. Did you ever take before the people the issue whether
jou should allow gambling to be open or closed?
128 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Clark. The newspapers more or less carried it as an issue up
there.
Mr. Hallet. At the election or before the election ?
Mr. Clark. Yes, sir.
Mr. Halley. And you were elected anyhow ?
Mr. Clark. Yes, sir.
The Chairman. Do you make any report to the attorney general
of Florida as to what the places are that are operating ?
Mr. Clark. No, sir.
Mr. Halley. Did he call on you to close down any of these places —
I mean the attorney general of Florida ?
Mr. Clark. He called on me this winter.
Mr. Halley. Did you close them down ?
Mr. Clark. Yes, sir.
The Chairman. When?
Mr. Clark. I don't know what date it was. Somewhere around the
first of the year, I believe.
The Chairman. Are Roscoe machines — these one-armed bandits —
illegal under the Florida law?
Mr. Clark. No, sir.
The Chairman. They are not in public places.
Mr. Clark. I don't laiow what you mean.
The Chairman. Wliere you put a quarter in, pull a lever, and you
might get something back and you might not.
Mr. Clark. In money or the horse races ?
The Chairman. No ; I am talking about the
Mr. Clark. No; they are not.
The Chairman. They are illegal.
Mr. Clark. Yes ; they are illegal.
The Chairman. Your county is pretty full of them ?
Mr. Clark. No, sir.
The Chairman. In the stores ?
Mr. Clark. No, sir.
The Chairman. Hotels?
Mr. Clark. No, sir.
The Chairman. Do you know Frank Erickson ?
Mr. Clark. No, sir ; I don't
The Chairman. Never met him?
Mr. Clark. Never have ; no, sir.
The Chairman, Do you know any of the fellows that operate the
Colonial Inn or Greenacres?
Mr. Clark. I know Jack Lansky.
The Chairman. You knew what he was doing ?
Mr. Clark. I knew he was running a place down there.
The Chairman. How long have you known him ?
Mr. Clark. Since he has been running it down here.
The Chairman. Sheriff, do these people pay you off?
Mr. Clark. No, sir.
The Chairman. Do they contribute to your campaign ?
Mr. Clark. They contribute to tlie campaign.
The Chairman. Did Jack Lansky?
Mr. Clark, The boys in the south end handle the campaign.
The Chairman. What do you mean "the boys in the south end" ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 129
Mr. Clark. I have friends down there, and they go to these fellows
and they contribute to the campaign.
The Chairman. How much do they contribute ?
Mr. Clark. I don't know. I never asked and never looked to see.
The Chairman. Who is the head of your organization in the south
end?
Mr. Clark. Mr. Lewis handles that.
The Chairman. What is his first name ?
Mr. Clark. Charlie.
The Chairman. Is he the fellow that got the money ?
Mr. Clark. I suppose it was ; yes.
The Chairman. Do you have any idea how much he got?
Mr. Clark. No ; I don't know.
The Chairman. $500, $10,000?
Mr. Clark. I don't know.
The Chairman. Don't you get around when you are preparing your
campaign and see how much you are going to need and sort of figure
where you are going to get it ?
Mr. Clark. It all depends on what it is going to cost.
The Chairman. What did your campaign cost you? What did
you spend on your last campaign ?
Mr. Clark. I don't know what we did spend.
The Chairman. You have an idea. Sheriff, of what you spent.
Mr. Clark. We had this campaign committee, and I never asked
them what they spent. I don't know what they did spend.
The Chairman. You have amassed a good deal of property;
haven't you ?
Mr. Clark. Not so very much ; no, sir.
The Chairman. Don't you own quite a number of business prop-
erties in Fort Lauderdale ?
Mr. Clark. No, sir.
The Chairman. How many ?
Mr. Clark. I got my home where I live. I got a little farm.
The Chairman. How little a farm ?
Mr. Clark. About 100 acres.
The Chairman. Don't you own a business property in Fort Lauder-
dale, or an interest in one ?
Mr. Clark. Yes, sir.
The Chairman. What is that?
Mr. Clark. It is a garage and filling station.
The Chairman, On the main street?
Mr. Clark. On the Federal Highway ; yes, sir.
The Chairman. Who is your associate in that ?
Mr. Clark. My brother.
The Chairman. What is his first name?
Mr. Clark. Robert.
The Chairman. How much did you pay for that business ?
Mr. Clark. I would have to check with him.
The Chairman. About how much? $25,000? $50,000?
Mr. Clark. I guess around maybe $30,000. I couldn't be positive.
The Chairman. Do you own any other business ?
Mr. Clark. No, sir.
The Chairman. Or any interest in any other business?
Mr. Clark. I cot a little farm land.
130 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. How much did you pay for that?
Mr. Clark. $16 an acre.
The Chairman. How many acres ?
Mr. Clark. I got about 200 acres.
The Chairman. About $32,000 ?
Mr. Clark. No.
The Chairman. $3,200; is that what you paid for it?
Mr. Clark. Something like that.
Tlie Chairman. Is it an orange grove ?
Mr. Clark. No; just faiTti land.
The Chairman. Do you have any other business interest?
Mr. Clark. Farm land — nothing but farm land and stuff like
that.
The Chairman. What is this "stuff like that" ? You would know
if you had some other business interests. You said you had your
home, half an interest in a filling station, and you have 200 acres of
farm land for which you paid $16 an acre, and what else?
Mr. Clark. I got some stock in Rib-N-Rite Co.
The Chairman. What type of company is that?
Mr. Clark. They started making attachments for typewriters.
The Chairman. Is it an operating concern now ?
Mr. Clark. No, sir.
The Chairman. Has it gone out of business?
Mr. Clark. It is in the hands of the court now.
The Chairman. In the hands of a receiver ?
Mr. Clark. Yes, sir.
The Chairman. Do you own any other real estate ?
Mr. CL.VRK. I own a lot. I would have to correct the record ; maybe
one or two little lots.
The Chairman. Are they valuable lots ?
Mr. Clark. No, sir.
The Chairman. Not valuable ?
Mr. Clark. No, sir.
The Chairman. How about any buildings ? Do you own any build-
ings ?
Mr. Clark. No, sir.
The Chairman. Wliat is the salary of the sheriff of Broward
County?
Mr. Clark. $7,500 a year.
The Chairman. Do you make anything extra on fees? Or is it a
straight-salary basis ?
Mr. Clark. Fee basis.
The Chairman. In addition to that, do you get a certain amount for
fees ?
Mr. Clark. I get all over a certain amount in fees.
The Chairman. Plus the $7,500?
Mr. Clark. Yes, sir.
The Chairman. What does the total salary usually run then ? The
salary, the fees, and the amounts you make out of the office?
Mr. Clark. I would have to check my records.
The Chairman. Over an average year you have some idea about
what it was.
Mr. Clark. I think my income was anywhere from $15,000 to
$35,000.
ORGANIZED CRIME IN INTERSTATE COMMERCE 131
The Chairman. That is from the office of sheriff, or is that all of
•your income?
Mr. Clark. That is all of it.
The Chairman. How about the office of sheriff? You get $7,500
salary and then fees for different things; I suppose turnkey fees and
things of that sort ?
Mr. Clark. Yes, sir.
The Chairman. What does that amount to?
Mr. Clark. It varies. Some years I will make more than I will in
others.
The Chairman. Let's say last year.
Mr. Clark. Last year I didn't make very much.
The Chairman. How much ?
Mr. Clark. I don't know. I would have to check and see.
The Chairman. How many gambling places operated in Broward
County last year during the season ?
Mr. Clark. Three or four.
The Chairman. How about bookmaking operations? Did you do
anything to try to check them ?
Mr. Clark. We closed them this winter.
The Chairman. After some State law was passed or after the Gov-
ernor issued an order about it?
Mr. Clark. The attorney general.
The Chairman. How many did you have operating up to that
time ?
Mr. Clark. I don't know.
The Chairman. What would be your best guess ?
Mr, Clark. I guess four or five of them places.
The Chairman. Along on the main street where anybody could
go in ?
Mr. Clark. In the city limits I usually let the county and city
police handle it.
The Chairman. Isn't it your responsibility as sheriff of the county ?
Mr. Clark. Yes; the same as it is their responsibility in the city.
However liberal the commissioners want it, that is what we are.
The Chairman. By "liberal," you mean how open they want it ?
Mr. Clark. Yes, sir.
The Chairman. That is what you let them go on ?
Mr. Clark. Yes, sir.
The Chairman. Do you feel that the people over there elected you
on an open-town platform ?
Mr. Clark. Yes, sir.
The Chairman. You have been doing that since 1933 ?
Mr. Clark. Yes, sir.
The Chairman. Suppose one of these fellows wants to set up a
place like Greenacres or Colonial Inn or an operation of that kind, do
they come and get in touch with you or some of your representatives
to make arrangements about it ?
Mr. Clark. They usually go to the official — they don't make ar-
rangements.
The Chairman. You say they get some officials ?
Mr. Clark. I mean, the city wants it liberal.
The Chairman. You mean he gets in touch with some of the city
officials about opening up?
132 lORGANIZED C'RIIMB IN mTEKSTATE COMMERCE
Mr. Clark. I don't know whether they get in touch with the city
officials.
The Chairman. Do they get in touch with you ?
Mr. Clark. No, sir.
The Chairman. Did Lansky get in touch with you when he opened
Colonial Inn?
Mr. Clark. No, sir.
The Chairman. Or any of his representatives ?
Mr. Clark. I don't know.
The Chairman. Do you know Mr. Allenberg down here ?
Mr. Clark. Yes, sir.
The Chairman. At the WofFord Hotel?
Mr. Clark. Yes, sir.
The Chairman. Did he come up to see you about opening up any
of these places ?
Mr. Clark. No, sir.
The Chairman. How well do you know Mr. Allenberg?
Mr. Clark. I have known him occasionally — seen him off and on.
We had a convention in his hotel a few years ago.
The Chairman. Any other questions, Mr. Halley ?
Mr. Halley. I want to know a little bit more about the liberal
ticket. You say the newspapers accused you of allowing the city to
be run wide open, or the county?
Mr. Clark. Yes, sir.
Mr. Halley. That was the opposition crowd ?
Mr. Clark. Yes, sir.
Mr. Halley. Did you issue a statement saying, "Of course, I am
going "
Mr. Clark. No.
Mr. Halley. Did you deny it?
Mr. Clark. No, sir.
Mr. Halley. If we checked the records, would we find that you
made a speech or issued a statement denying charges that ^-ou failed
to enforce the law ?
Mr. Clark. I don't think you would.
Mr. Halley. You never denied those charges ?
Mr. Clark. Not that I remember.
Mr. Halley. Never admitted it or denied it. You just let it ride?
Mr. Clark. Not that I remember.
Mr. Halley. What did you say in your campaign? Did you make
some speeches?
Mr. Clark. I made one speech.
Mr. Halley. Did you say anything about gambling in your speech ?
Mr. Clark. No, sir.
The Chairman. What did you say, Sheriff ?
Mr. Clark. Just told them that I was — I thought I had done a
good job as sheriff of the county.
The Chairman. Told them that you were healthy ?
Mr. Clark. Told them a few of the things I had done for them.
The Chairman. But you didn't say anything one way or the other
about gambling?
Mr. Clark. No, sir.
The Chairman. Did your opponent?
Mr. Clark. He did.
ORGANIZED CRIME IN INTERSTATE COMMERCE 133
The Chairman. How much did you win by ?
Mr. Clark. I think I beat two men by somewhere around 1,500
votes.
The Chairman. Out of how many votes?
Mr. Clark. I guess it was — I can't say positive — maybe 18,000 or
20,000 votes, I guess.
Mr. Halley. Did you provide deputies to protect these gambling
houses ?
Mr. Clark. No, sir.
Mr. Halley. There are no deputy sheriffs ?
Mr. Clark. No, sir.
Mr. Halley. Are there any stationed in any of the gambling houses ?
Mr. Clark. No, sir.
Mr. Halley. Do they all contribute to your campaign ?
Mr. Clark. I don't know.
Mr. Halley. Did the people who run Greenacres contribute ?
Mr. Clark. I couldn't say. I didn't go to them and ask them myself.
Mr. Halley. What do you think ?
Mr. Clark. I couldn't tell you.
Mr. Halley. Have you ever been to Greenacres, or have you walked
into the place ?
Mr. Clark. No.
Mr. Halley. The Boheme Club?
Mr. Clark. I was down there at some charity affair sometime.
Mr. Halley. Were you ever in the Colonial Inn ? That is, before
it gave up its gambling operations ?
Mr. Clark. We were down at a couple of charity affairs sometimes.
Mr. Halley. Prior to the charity affairs, is it your testimony that
you never entered the premises of Greenacres or besides those affairs ?
Mr. Clark. I don't believe I was ever in there unless I went down
after somebody ; I don't remember.
Mr. Halley. Did you consider it your duty as sheriff of the county
to at least find out what was going on in a place that was notoriously
engaging in gambling, even if you were liberal ?
Mr. Clark. I never had any complaints on it.
Mr. Halley. You knew gambling was going on ?
Mr. Clark. Yes, sir.
Mr. Halley. You didn't even care to find out what it was like ?
Mr. Clark. No.
Mr. Halley. And the same applies to Club Boheme? And to the
Colonial Inn?
Mr. Clark. Never went in them.
Mr. Halley. Was there gambling at the charity affairs ?
Mr. Clark. No, sir.
Mr. Halley. Just eating and entertainment?
Mr. Clark. Yes, sir.
Mr. Halley. During those charity affairs, was gambling going on
in the other rooms?
Mr. Clark. No, sir.
Mr. Halley. You would say that you have never personally wit-
nessed any gambling in any of those places such as Club Boheme,
Colonial Inn, or Greenacres ?
Mr. Clark. Yes, sir.
134 ORGANIZED ORIIME' IN INTERSTATE COMMERCE
Mr. Halley. That is your specific testimony ?
Mr. Clark. Yes, sir.
Mr. Halley. I have no other questions.
The Chairman. Thank you, Sheriff. Do you want to make an addi-
tional statement?
Mr. Clark. I closed up Greenacres one time.
The Chairman. When was that?
Mr, Clark. Two or three years ago.
The Chairman. What did you do that for ?
Mr. Clark. On some complaints.
The Chairman. They got a little rowdy, did they ?
Mr. Clark. I had some complaints from somebody.
The Chairman. Didn't they open right up after that ?
Mr. Clark. I don't remember.
The Chairman. You just closed them up for a short time?
Mr. Clark. I don't remember whether they were closed for the rest
of the season or not.
The Chairman. All right, Sheriff. Thank you.
Mr. Halley. The stenographer is specifically instructed to keep the
notes and any extra copies of the testimony in a secure place under
lock and key, and to advise the committee of the total number of
copies which are made and the location of any extra copies and of
the notes.
The stenographer is further instructed not to divulge any copies
of the testimony except with the permission of the committee in
writing.
The committee will require one copy of the record, for which the
committee is to be billed at the price agreed.
(Whereupon, at 5 : 50 p. m., the hearing was adjourned subject to
call of the chairman.)
INVESTIGATION OF OEriANIZEI) CRIME IN INTERSTATE
COMMERCE
THURSDAY, JULY 13, 1950
United States Senate,
Special Committee To Investigate
Organized Crime in Interstate Commerce,
Miami^ Fla.
The committee met in the courtroom of the United States district
court, Miami, Fla., on July 13, 1950, Senator Estes Kefauver (chair-
man), presiding.
Present : Senators Kefauver and Hunt.
Also present : Rudolph Halley, chief counsel ; Alfred Klein, associ-
ate counsel ; Downey Rice, associate counsel ; William Garrett, associ-
ate counsel ; Harold G. Robinson, chief investigator ; Ralph W. Mills,
investigator; Daniel P. Sullivan, operating director; and Col. J. R.
Younger, president of the Crime Connnission of Greater Miami.
The Chairman. The committee will come to order.
Ladies and gentlemen, this is a duly constituted hearing of the
United States Senate Special Committee To Investigate Organized
Crime in Interstate Commerce, pursuant to Senate Resolution 202,
Eighty-first Congress, second session, which vests in this committee
the following authority, and for the benefit of the interested people
and the public it might be well to read the resolution under which
this committee operates. It is very brief. It requires the committee —
to make a full and complete study and investigation of whether organized crime
utilizes the facilities of interstate commerce or otherwise operates in inter-
state commerce in furtherance of any transactions which are in violation of the
law of the United States or of the State in which the transactions occur, and, if
so, the manner and extent to which, and the identity of the persons, firms, or
corporations by which such utilization is being made, what facilities are being
used, and whether or not organized crime utilizes such interstate facilities or
otherwise operates in interstate comniierce for the development of corrupting
influences in violation of the law of the United States or of the laws of any
S'tate: Provided, however, That nothing contained herein shall (1) authorize
the recommendation of any change in the laws of the several States relative to
gambling, (2) effect any change in the laws of any State relative to gambling,
or (3) effect any possible interference with the rights of the several Sates to
prohibit, legalize, or in any way regulate gambling within their borders. For
the purposes of this resolution, the term "State" includes the District of Co-
lumbia or any Territory or possession of the United States.
With reference to the jurisdiction of the committee, it will be seen
that if there is any violation of the laws of the United Statas or of
the several States involving interstate commerce, there is jurisdiction
in this committee.
135
68958— 50— pt. 1 10
136 (ORGANIZED OROME' IN INTERSTATE COlVIMERaE
In the hearings of the committee, the question of jurisdiction will
not be considered from purely the matter of the particular hearing
at the place wliere it is being had — that is, in hearings in other parts —
in Washington and elsewhere — the committee has developed and un-
questionably will develop to a greater extent matters which relate to
interstate transactions in which Florida operations and people are
involved.
So, in case the matter should come up as to the question of contempt
proceedings or anything of that sort, the over-all picture developed by
the committee will be considered relative to its jurisdiction.
It must be apparent, however, that while the committee has very
wide jurisdiction to make its investigation, this is not a prosecuting
committee. We are not a court for the purpose of inflicting penal
punishment upon anyone.
The purpose of the committee is, of course, as with any legislative
committee, to find out what the facts are with reference to whether the
laws of the Federal Government are adequate, whether they need
changing, or whether any amendments or additional laws should be
passed.
Of course, it is the hope of this committee also to make it clear that
we cannot possibly investigate every criminal in the United States or
every criminal transaction. If we did so, we could, of course, spend
a great deal of time and go to many places in the country.
We wish to call your attention to the fact that this committee is
composed of five very busy Membei^ of the United States Senate, and
the staff of the committee, or most of them, are doing what they are
as a matter of public service rather than for compensation.
So we are anxious to do our job as thoroughly as we can and make
our report to the Senate. We will try to get a thorough, accurate, and
over-all picture of the big aspects of the problem that we are investi-
gating, and the rest is the responsibility and job of the local people,
the local law-enforcement people and officers, and people who want
and are interested in good government.
As to the work of this committee, any laws that the Federal Govern-
ment may pass cannot, of course, give you law enforcement or elimi-
nate criminal activities unless the local people want to have it done
and are willing to see that they have law-enforcement officers and
governmental officials w^ho will insist that it be done.
We are not setting ourselves up in competition with any law-enforce-
ment officers, the Department of Justice, the local-enforcement officers,
or the State of Florida.
Our hope is that we can work in cooperation with and be of assistance
to these enforcement agencies, and that we may be able to present to
the public the tremendous importance of the over-all crime picture
as it affects the daily lives of the people of our country.
In that connection it may be appropriate to state that the best evi-
dence we have is that the take from crime, gambling, and other cor-
rupting influences from the American people per year — and it has
to be a rather wild guess — is somewhere between 15 and 22 billion
dollars.
That is, of course, a great deal more than we are spending on our
armed services and our Armed Forces today.
ORGANIZED CRIME IN INTERSTATE COMMERCE 137
The second part of the jurisdiction of this committee is to see what,
if any, corrupting influences, are at work upon law-enforcement officers
and people in government generally.
In the long run, it is, of course, necessary to first establish — and
that will be done either here or in hearings in other parts of the
country — that there have been violations; that there is a stream of
crime in interstate commerce, and then from that point the committee
has jurisdiction to see what, if any, corrupting influences may have
resulted or may have come along as protection in order that such
crime might take place.
It is not, however, our prerogative, unless that is established or
unless we know that it is going to be established, to get into the matter
of local politics. State, county, or city.
We are not charged with the job of investigating the purity or lack
of purity in local political matters unless it comes within the first
major premise.
The present hearing is that of a subcommittee which is duly con-
stituted as consisting of the chairman of the committee and Senator
Lester C. Hunt, of Wyoming. Such subcommittee is designated pur-
suant to a resolution duly adopted by a quorum of the full committee
at a committee meeting held in Washington, D. C, on July 11, 1950.
Said resolution, which is hereby made a part of the minutes of this
meeting, reads as follows:
Be it and it is hereby resolved, That the chairman be and he hereby is authorized
to designate subcommittees for the purpose of holding hearings at Miami, Fla.,
on July 13 and 14, 1950 ; at St. Louis, Mo., on July 18, 1950 ; and at Kansas City,
Mo., on July 19 and 20, 1950, or at such other time as the chairman may specify ;
and, that, one member of the subcommittee so designated shall constitute a
quorum for the purpose of conducting such hearings, administering the oath,
and taking testimony of witnesses appearing before it, and taking such other
action as may be appropriate.
At the outset I desire to state that this committee, through a duly
constituted subcommittee, held executive hearings in Miami, Fla., on
May 26 and May 27, 1950, at which 13 witnesses were heard and cer-
tain documents were subpenaed.
Thereafter, through its investigative staff, the committee continued
to make investigation in Miami, Fla., and in Dade County and Bro-
ward County, Fla. The committee is now ready to hear certain wit-
nesses with reference to certain of the facts developed in this in-
vestigation.
However, it is important that it be made clear at this point that
these hearings are a portion of a continuing investigation of organized
crime in Dade and Broward Counties and elsewhere. Certain wit-
nesses upon whom the committee has attempted to serve subpenas
cannot be found at their usual residences and places of business.
These include :
Sam Cohen, Harold Salvey, Charles Friedman, Edward Rosen-
baum, Jules Levitt, Harry Russell, George L. Bowers, William H.
Johnston, John Patton, Sr., and Jack Friedlander.
These witnesses may be under the mistaken impression that by re-
maining away from their usual places of abode they can impede or
avoid the investigation of this committee. The committee hereby
serves notice upon them that any such impression is entirely erroneous.
The committee hearings will continue here at this time and in Wash-
138 ORGANIZED OROME' IN INTERSTATE COMMERCE
ington and in other places hereafter. The committee will hear at
this time as many as possible of the considerable number of witnesses
who will appear before it. The committee will seek out any witnesses
upon whom it has not been able to effect service of this lawful process
and these witnesses will be found and brought before this committee
to testify.
Let me say by way of explanation that Mr. Sam Cohen had an
operation and is in the hospital and he has expressed a willingness to
testify when he is able to do so.
The chairman and the committee liave checked with the people
who have undertaken to serve subpenas upon the other witnesses. A
diligent effort has been made to locate them. It is inconceivable that
they do not know they are desired for appearance before this com-
mittee. The only impression or conclusion that must be drawn from
their refusal to appear or to get in touch with the committee or with
our staff is that they feel that they, by their absence, might be able to
impede the investigation of this committee, or that they feel that it
would be very bad for them for what they have done or the business
they are engaged in for them to appear.
But in any event the subpenas will remain outstanding for them,
and if by any chance any of them have not heard they are wanted
here, we hope that they will get in touch with us.
The press and radio have been very cooperative in carrying the
message all over the Nation that these men are wanted.
They will not be able to permanently embarrass the committee and
they are doing themselves no good by failing to cooperate. This, of
course, makes it more difficult for the committee because these are
important witnesses and in certain phases of our investigation we
will necessarily, for the time being, have to resort to secondary evi-
dence, whereas we would, of course, like to present more direct evi-
dence.
Tlie committee wishes at the outset to thank Judge Holland, the dis-
trict judge, and Judge Whitehurst for their cooperation in making
this courtroom available. They have arranged to hold trials and
hearings at great inconvenience in other quarters in order to cooperate
with the committee. We are very, very grateful to them.
We are grateful to Deputy Marshal Gates and his assistants for
their cooperation and their help both at the executive hearings and at
this hearing.
Many of the officials of the Government of Florida, Dade County,
Miami, in this section, have been of tremendous assistance and have
tendered their cooperation and we want to express our thanks to
them; also to Col. Jack Younger, president of the Greater Miami
Crime Commission, and to Dan Sullivan, and to the valiant citizens
who have worked with that commission and backed it up. We want
to thank them and pay a very high compliment to them for the work
they have done. It has been invaluable to us.
Now, the rules of the game in this hearing will be that if any wit-
ness is called, necessarily some names will be used. Some people will
be talked about aud some charges will be made against people who are
not present.
By screening the testimony at private hearings, we have tried to
eliminate as mucli of that as possible. The committee does not wish
to do any innocent citizens any harm. If inadvertently any harm is
ORGANIZED CRIME IN INTERSTATE COMMERCE 139
done, we want to rectify it as quickly as possible. So that while we
have a very full schedule, if any person whose name is used here or
anywliere else in the country feels that he has been maligned or un-
justly accused or represented, or if they want to make any explana-
tion, or if they want to charge that any statement that has been made
is untrue, the committee will hear them on the same clay the statement
is made, if they make application to the committee or to our staff, and
give them an opportunity to make any explanation or to refute any
charges that have been made. They can feel at perfect liberty to get
in touch with any of us about it.
If any one of the witnesses wishes to have counsel present, counsel
will be welcomed.
Ordinarily the rules of the committee provide that questions that
counsel wish to ask shall be given to the committee. We will permit,
within reasonable limitations, one's own counsel to ask questions,
but of course we will have to limit the extent if it goes on too long.
I don't know whether we are going to be able to permit smoking over
a long period of time or not. We will start off with permission to
smoke. We may have to discontinue it.
The committee also wishes to thank the press for its cooperation
and the press photographers. We want to have order and decorum
in the committee and we don't want to have anyone embarrassed. We
want to get the facts from the witnesses, so when a witness first ap-
pears on the witness stand, the ]5hotographers with their flashlight
bulbs can take his picture, or during the time he is sworn, or just be-
fore he testifies or after he testifies. During the testimony I will
have to ask that flashlight bulbs not be used. I am sorry if this in-
conveniences anyone, but some people find it very difficult to think and
testify with bulbs flashing about.
Senator Hunt?
Senator Hunt. Mr. Chairman, I believe I have nothing in addi-
tion to what you liave said. I think you have touched on all matters
that need to be touched on before the opening of the hearing and I
have nothing further to add.
The Chairman. Thank you, Senator Hunt. Does anyone have any
brief questions he wants to ask about procedure ?
(No response.)
The Chairman. If not, the resolution appointing this committee
as a subcommittee to receive testimony will be made a part of the
record.
(The resolution is as follows :)
Resolution
Be it and it is hereliy resolved, That the chairman be and he hereby is author-
ized to designate subcommittees for the purpose of holding hearings at Miami,
Fla., on July 13 and 14, 1950, at St. Louis, Mo., on July 18, 1950, and at Kansas
City, Mo., on July 19 and 20, 1950, or at such other time as the chairman may
specify ; and, that one member of the subcommittee so designated shall con-
stitute a quorum for the purpose of conducting such hearings, administering
the oath, and taking testimony of witnesses appearing before it, and taking such
other action as may be appropriate.
The Chairman. Mr. Colman and Mr. Laiken and the others, will
you please be sworn ?
(Messrs. Henry E. Colman, Leonard Laiken, Irving Bakst, Gordon
B. Girling, and Billy L. Pickett were sworn as official reporters for
the subcommittee.)
140 ORGANIZED CRIME' IN" INTEESTATE COMMERCE
The Chairman. Wlio is our first witness ?
Mr. Hallet. Mr. Walter Morris.
The Chairman. Our first witness is Mr. Walter Morris. Mr. Mor-
ris, will you come forward, please ?
TESTIMONY OF WALTER MORRIS, ASSISTANT DIRECTOR OF
COMMUNICATIONS, NATIONAL AIRLINES
The Chairman. Mr. Morris, do you solemnly swear that the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God ?
Mr. Morris. I do.
Mr, Halley. Mr. Morris, will you state your address and your
occupation ?
Mr. Morris. My address is 1947 Northwest Forty-eighth Street, Mi-
ami, Fla. I am employed by National Airlines as assistant director of
communications.
Mr. Halley. Mr. Morris, did you serve on the grand jury for Dade
County, Fla. ?
Mr. Morris. Yes, sir ; I served as foreman of the spring term grand
jury for the period May 10, 1949, to November 7, 1949.
Mr. Halley. And did that grand jury issue a presentment ?
Mr. Morris. It issued a final report to the court.
Mr. Halley. A report was presented to the court ?
Mr. Morris. Yes.
Mr. Halley. And can you, as foreman of that grand jury, identify
that report?
Mr. Morris. Yes.
Mr. Halley. Do you have a copy with you ?
Mr. Morris. I have.
Mr. Halley. Mr. Chairman, I offer in evidence as exhibit No. 106 the
grand jury report.
The Chairman. The grand jury report will be received and made
a part of the record as exhibit No. 106 to the testimony of Mr. Morris.
(See appendix, pp. 735-740.)
Mr. Halley. Will you summarize the findings of the grand jury
of which you were foreman ?
Mr. Morris. Well, we found in the testimony of witnesses whom we
considered to be reliable that there appears to be quite a congregation
of criminal elements in the Miami area, or in the south Florida area.
Mr. Halley. Did you find any crime condoned by local law-enforce-
ment agencies ?
Mr. Morris. Well, we found that crime existed, and that it would
be difficult to believe that it could exist without the condonation of
local law-enforcement agencies.
Mr. Halley. Did you have occasion to censure any law enforcement
agency in Dade County ?
Mr. Morris. I believe that we made some mention of the sheriff's
office and their efforts to locate members of the jury, or rather to serve
subpenas for jury service, and we also had something to say about the
city police department.
Mr. Halley. What did you have to say about the city police depart-
ment?
ORGANIZED CRIME IN INTERSTATE COMMERCE 141
Mr. Morris. It seemed that quite a bit of bickering and feuds existed
in tlie police department.
Mr. Hallet. Reading from page 7 of your report, did the grand
jury conclude as follows :
If the people of Dade C5ounty desire that organized crime be destroyed, it can
be destroyed. The facilities required are available in the choice of men they
elect as sheriff and city commissioners.
Mr. Morris. Yes ; we made such a statement.
Mr. Halley. Did you hear evidence to justify such a statement?
Mr. Morris. Yes.
Mr. Halley. Did you hear witnesses?
Mr. Morris. Yes.
Mr. Halley. Did you conclude that bookie operations were operat-
ing in the city of Miami and in the city of Miami Beach ?
Mr. Morris. Yes.
Mr. Halley. And you heard witnesses who testified to this effect?
Mr. Morris. We did.
Mr. Halley. Did you hear testimony to the effect that Dade County
was wide open to anybody desiring to visit well-appointed air-con-
ditioned places set up for card games, dice games, roulette, and book-
making?
Mr. Morris. We did.
Mr. Halley. Did you find that in Miami, Bolita and the numbers
racket were flourishing ?
Mr. Morris. Yes ; they were.
Mr. Halley. Did you conclude that there appeared to be little
effort made to curb these gambling operations, although they were
being carried on under the eyes of the police ?
Mr. Morris. Yes.
Mr. Halley. Now, Mr. Morris, did you find any evidence that
this crime was on an organized basis by groups of organized criminals
operating on a widespread basis ?
Mr. Morris. Well, particularly in bookmaking, it would be very
difficult to believe that the organization or the set-up that they had
could exist unless it was conducted on an organized basis.
Mr. Halley. And did you have testimony to that effect ?
Mr. Morris. Yes.
Mr. Halley. Did you have testimony to the effect that nationally
known criminals and racketeers were finding a haven in Dade County ?
Mr. Morris. We did.
Mr. Halley. And that these same criminals and racketeers were
in charge of the crimes as to which you had testimony ?
Mr. Morris. Yes.
Mr. Halley. Mr. Morris, is there anything further you would like
to say about your findings and about the evidence before you to this
committee ?
Mr. Morris. Well, it would appear to us that it would be very diffi-
cult for local law enforcement agencies to cope with some of these
things when they cross State lines, and there was evidence presented
to us which indicated that in many cases the criminal activity in one
location is being conducted more or less from a remote point, at a
headquarters, so to speak, which in many cases exist outside the com-
munity, outside the county, and even in a different State.
142 ORGANIZED ORlIME: IN INTE'R'STATE eiOMMERCE
Mr. Halley. Do you have any recommendations you would want
to make to this committee ?
Mr. Morris. Being a layman I wouldn't feel that I was competent
to make recommendations for the enactment of legislation necessary
to control this, but I do feel that there is a definite need for it.
Mr. Halley. As a grand jury, your function was to find facts?
Mr. Morris. Yes.
Mr. Halley. And you heard evidence and on this evidence you did
find facts ?
Mr. Morris. Yes.
Mr. Halley. I have no further questions, Mr. Chairman.
The Chairman. Mr. Morris, what is your occupation? What do
you do ?
Mr. Morris. I am an airlines communications man.
The Chairman. This report was made in the spring of 1949 or in
the summer of 1949 ?
Mr. Morris. The jury was impaneled in the spring of 1949 and the
report was submitted on November 7, 1949.
The Chairman. And there had been a previous grand jui-y which
made a report in 1947 or 1948?
Mr. Morris. Yes.
The Chairman. It is stated here that your report is a repetition of
what is contained on the subject in the admirable report of the grand
jury for the winter term of 1947.
Mr. Morris. Yes.
The Chairman. So the conditions that you found have apparently
been going on for some time ?
Mr. Morris. Apparently so.
The Chairman. Mr. Morris, what indictments, did you return
against any of these gamblers ?
Mr. Morris. We returned no indictments against them.
The Chairman. Isn't the province of a grand jury to ferret out vio-
lators of the law and return indictments against them ?
Mr. Morris. It is.
The Chairman. Why couldn't you do that?
Mr. Morris. Well, the grand jury was handicapped by many things.
Our grand jury was somewhat confused by the enactment of certain
State legislation intended to strengthen the system which actually
placed some doubt as to our legal status.
The Chairman. Do you mean by "State legislation" whether you
had jurisdiction in the county or whether the State had jurisdiction?
Mr. Morris. No. The legality of the jury itself was in question
for a while. It is very difficult for a local grand jury to get evidence
against people who are operating through several States. After all,
we are liere in one place, and it is very difficult to follow leads which
disappear across State boundaries.
The Chairman. How about bookmaking and gambling places and
places of that sort ? Are they so difficult to find ?
Mr. Morris. No ; they are not difficult to find at all.
The Chairman. Why couldn't you bring them in and get indict-
anents against them?
Mr. Morris. Frankly, we could see little point in indicting a local
small-time bookmaker who is merely one small part of a large organi-
zation.
ORGANIZED CRIME IN INTERSTATE COMMERCE 143
The Chairman. And you couldn't reach the bigger fellow?
Mr. Morris. We couldn't reach the bigger fellows at all. We tried.
Six months we tried.
The Chairman. What efforts did you make?
Mr. Morris. We used every tool at our command. Our final deci-
sion was that the grand jury was probably incapable or incompetent
to deal with crime on such a widespread basis, such a widespread or-
ganization. Our final recommendation was that perhaps the P^ederal
Government might look into it.
The Chairman. Well, sir, as you very well know, this business of
passing on the responsibility to the Federal Government is not a very
healthy picture. We want to assume the responsibility where it is
necessary that we do it, but getting the Federal Government into the
local law enforcement is not a healthy thing, in the opinion of the com-
mittee, if it can be handled by the local people.
After all, unless it has the backing of and support of the local agen-
cies, nobody can get very far.
Take Frank Costello and Frank Erickson and many of thosepeople
who have been over here and who operate in this section, don't they
come here where they can be reached by subpena of the grand jury?
Mr. Morris. They appear to be here from time to time; yes.
The Chairman. Where they would be subject to arrest in this juris-
diction ?
Mr. Morris. Yes.
The Chairman. How about the cooperation of the law-enforcement
officers with the grand jury? Did they bring information to the
grand jury about the so-called big operators that you have talked
about ?
Mr. Morris. I can't say that we received information from them as
to the big-time operators ; no.
The Chairman. Senator Hunt, do you have any questions ?
Senator Hunt. I might ask: What particular office or what par-
ticular local official has the greatest responsibility in enforcing the
gambling and the vice laws ?
Mr. Morris. I M-ould say the sheriff does.
Senator Hunt. The sheriff's office?
Mr. Morris, That is my personal opinion.
Senator Hunt. Did the sheriff appear before your grand jury?
Mr. Morris. No ; he did not.
Senator Hunt. How come he didn't testify ?
■ Mr. Morris. During a great portion of our time, I believe he was
out of the State fishing.
Senator Hunt. Out of this State fishing?
Mr. Morris. I think he was; yes.
Senator Hunt. The State is rather noted for fishing itself; isn't it?
Mr. Morris. As I remember, it was North Carolina or some such
place. They also have fish there.
Senator Hunt. How long were you in session ?
Mr, Morris. For 6 months.
Senator Hunt. And he was fishing for the full 6 months ?
Mr. Morris. I don't believe that he was during that last portion.
Some other things came up which made it inad\asable for us to call
him at that time.
144 ORGANIZED C'RIIME IN INTERSTATE COMMERCE
Senator Hunt. I take it from your answer to my question that
the grand jury would primarily hold the sheriff accountable for the
lack of enforcing the law ?
Mr. Morris. I think he is the supreme authority in the county;
yes.
Senator Hunt. Is that the sheriff that was removed by the former
Governor, or was that in another county ?
Mr. Morris. I think that is another county, sir.
Senator Hunt. It is a little difficult to understand, Mr. Morris,
after your investigation and what you have put in your report, that
you were unable to bring any indictments of any kind. What par-
ticularly intimidated your grand jury?
Mr. Morris. Well, I think that some of the things which actuallj'
stopped us from doing more were things beyond our control and
which actually have no bearing ; certain State legislation which unfor-
tunately was enacted at the time our jury was in session.
Senator Hunt. I know you are not an attorney, but do you happen
to know what that legislation was, or what the purport of it was ?
Mr. Morris. Yes. It was intended to strengthen our jury system
by increasing the number of members on each jury in order that it
would be easier to maintain a quorum, and the law was enacted in-
creasing the number of jurors without the saving clause to the jury
which was in existence at the time of the enactment, and it was taken
then to the circuit court.
The first indictment we returned was appealed to the circuit court
and then to the supreme court as to whether or not we were a legally
constituted body, and there was considerable confusion for some time
and we didn't know what to do.
Senator Hunt. I have no other questions.
The Chairman. The sheriff you referred to was Sheriff Jimmy
Sullivan of Dade County ?
Mr. Morris. That is true ; yes.
The Chairman. Thank you, Mr. Morris.
TESTIMONY OF HON. STANLEY MILLEDGE, JUDGE OF THE
CIRCUIT COURT OF DADEn[!OUNTY, FLA.
The Chairman. Judge Stanley Milledge, please.
Judge Milledge, do you solemnly swear that the testimony you will
give the committee will be the truth, the whole truth, and nothing but
the truth, so help you God ?
Judge Milledge. I do.
The Chairman. The committee appreciates your appearance here,
and we hope you will feel free to give us any information you think
will be of help to us.
Mr. Halley. Judge Milledge, are you a judge of the Circuit Court
of Dade County ?
Judge MiiXEDGE. Yes.
Mr. Halley. How long have you been a member of that bench ?
Judge Milledge. About 5i/^ years.
Mr. Halley. Did you, in connection with your official duties, become
acquainted with any matters of law enforcement in Dade County?
Judge Milledge. Well, my principal source of knowledge was prior
to my being on the bench, or, rather after I had served an interim term
ORGANIZED CRIME, IN INTERSTATE COMMERCE 145
of C months. Then I was State attorney for 2 years from August 1
1943, until I went on the bench 2 years hiter.
Mr. Halley. In w^hat year did you ^o back on the bench ?
Judge MiLLEDGE. I went back on July 1, 1945.
Mr. Halley. Now, did you have occasion at some time to appoint a
number of private citizens as agents of the court and furnish them
with warrants to obtain evidence ?
Judge MiLLEDGE. On one occasion. I don't recall just when it was.
I believe it was a year ago last March or April.
Mr. Halley. Would you state exactly what you did on that occasion,
Judge ?
Judge MiLLEDGE. Some people came to me with their affidavit just as
a law-enforcement officer, fortified by photographs of some place over
at Miami Beach showing headphones and all the usual paraphernalia
not merely of a gambling establishment but a relay station at least for
disseminating gambling to bookies. On the basis of the affidavit,
which was in the usual form of affidavit upon which a warrant of
arrest and search is sought, fortified by other testimony, considerable
doubt was expressed as to whether if that warrant were given to the
law-enforcement officers designated by law to serve warrants it would
be effectively served, and I appointed an elisor under the statutory
provision which permits the court to do that in case of necessity.
Mr. Halley. Did you furnish your elisor with warrants?
Judge MiLLEDGE. Yes.
Mr. Halley. And was the warrant served on the premises at which
there was alleged to be this gambling and bookmaking equipment ?
Judge MiLLEDGE. It was.
Mr. Halley. Would you state the name of the premises at which
the establishment was located ?
Judge MiLLEDGE. I am sorry, I don't recall. I could
Mr. Halley. Was it the Surf side Hotel at Miami Beach ?
Judge MiLLEDGE. I believe so.
Mr. Halley. And what was the result of the serving of the warrant ?
Was an indictment found on the premises ?
Judge MiLLEDGE. Yes. The warrant was returned to me. Of course,
any prosecution upon that warrant would not be in the circuit court ;
so, I had nothing further to do with any prosecutions that might have
resulted from that action.
The warrant, of course, having issued from the circuit court, was
returnable to the circuit court; and the warrant, affidavit, and the
objects seized as a result of the warrant were then turned over to the
clerk of the Criminal Court of Record of Dade County.
Mr. Halley. Did your elisors find a short-wave radio in operation
on those premises ?
Judge MiLLEDGE. I am sorry, I don't recall.
Mr. Halley. Do you know whether they found a large number of
telephones present?
Judge MiLLEDGE. Yes; I remember that. I haven't had any oc-
casion to check back on any of this since the return of the warrant.
I am speaking from memory, but I do recall that there was a consid-
erable number — I don't recall how much — of telephone equipment.
Mr. Halley. Did they find a bookmaking establishment operating
as well ?
Judge MiLLEDGE. I believe so.
146 ORGANIZED GRIME' IX INTERSTATE COMMERCE
Mr. Hali^ey. Do you know whether the case after it left your hands
was prosecuted to a conchision ?
Judge MiLLEDGE. No. An information was filed by the solicitor of
Dade County, and there have been some hearings on it recently. In
addition to knowing about it from reading the newspapers, I am
aware of it because one of the assistant county solicitors telephoned
me and asked me if I would testify in the criminal court of record
as to what evidence I had upon which I issued the warrant to an
elisor rather than one of the regular constituted law-enforcement of-
ficers. I told him I was willing to do so, but I have heard nothing
on it since, and I don't know exactly what has happened; but I do
know from that that there has been no trial of the case.
The Chairman. You mean, the arrest was made in April 1949 and
there has been no trial as yet ?
Judge MiLLEDGE. I am not certain of the date, but there has been
no trial, and I believe that is the approximate date of the arrest.
Mr. Halley. Is that an unusual delay on an information for gam-
bling and operating a handbook ?
Judge MiLLEDGE. Well, in my circuit court we have criminal juris-
diction over capital offense; but, speaking from general knowledge,
I would say this type of case that was not unusual ; no. If it were
some insignificant bookmaker I would say that was rather longer
than usual.
Mr. Halley. Are you properly interpreted in saying that in case
of an important law breaker there is a lengthly delay in the adminis-
tration of justice in Dade County?
Judge MiLLEDGE. There usually seem to be difficulties of one sort
or another that are always encountered, perhaps sometimes the ab-
sence of witnesses that are material as, for example
The Chairman. We appreciate the absence of witnesses, Judge.
Judge MiLLEDGE. Yes. I understand you are having the same
difficulty.
When I was State attorney we had a long session of the grand
jury, from May until November. We called in the members of the
Miami Beach group most of the names of which I recall from having
heard them read out here by you this morning. Senator Kefauver.
We called one of the accountants of the group, realizing, of course,
that we were giving immunity, but we didn't think that was giving
him anything because he already had the most effective immunity
that he could possibly have. As a result of that, the record and testi-
mony of one of the partners, we returned indictments against all of
the others.
Of coui-se, with us, criminal prosecutions except in capital cases are
not upon indictment. They are upon information by the county
solicitor, and an information can issue directly by the solicitor or
he can use the grand jury indictment as well as a base. He is not
by law required to inform simply because a grand jury has indicted,
but he did. He informed against the same persons whom the grand
jury indicted, but those cases never came to trial, and I understand
ithat one of the witnesses, the accountant, went to Brazil ; and it is my
information that he has never returned here.
The Chairman. What is his name?
Judge MiLLEDGE. Davis. R. Davis, I believe. And the other one,
the one we got the information from, Friedman, got ill, I undei^tand,
and had to spend a great many months in a New York hospital.
ORGANIZED CRIME IN INTERSTATE COMMERCE 147
I understand that when tlie case was finally called it was called
at the insistence of the defendants who complained of the long delay
in not being brought to trial. Of course, the State was then unable
to proceed because it had no witnesses.
Mr. Halley. Mr. Chairman, at this point I would like to offer in
evidence a clipping from the ]Miami Daily News dated July 11, 1950.
The Chairman. That will be received and admitted as exhibit No.
107 to Judge Mi Hedge's testimony. (See appendix, p. 740.) Do you
want to read part of it?
Mr. Halley. May I? This is headed "County Delays Elisor Con-
ference," and it states that there is a conference pending in connection
with the cases of 15 men arrested, and I am quoting :
County authorities have postponed until Thursday their conference on future
action in tlie cases of 15 men arrested in an elisor raid on the Surfside Hotel at
Miami Beach a year ago last April.
The conference wdiich has been called, according to the newspaper,
will be with the assistant of the county solicitor —
and attorneys for the S. & G. syndicate. The latter have moved to suppress
evidence in the case on grounds that an elisor warrant is illegal.
Do you know w^ho the S. & G. syndicate are ?
Judge MiLLEDGE. Well, that is the popular name, shall I say, of
the peoj^le whom I referred to as having been indicted by the grand
jury in the long term of 1914 and the same people whose names I
heard read this morning as not having been served by the subpena of
this committee.
Mr. Halley. Are they the people to whom you referred as having
been successful in many cases in delaying the administration of
justice?
Judge MiLLEDGE. I wouldn''t say they exclusively; no.
]Mr. Halley. They and others?
Judge MiLLEDGE. And others ; yes.
Mr. Halley. Do you know whether or not the police department of
Miami Beach cooperated with your elisors when they attempted to
serve a search warrant?
Judge MiLLEDGE. Well, of coui*se, I w^asn't there
Mr. Halley. Was a report made to you ?
Judge MiLLEDGE. Yes ; that they did.
Mr. Halley. And a report was made by the elisors, by your elisors,
and their official return to you ?
Judge MiLLEDGE. That is correct.
Mr. Halley. Would you state what the official return to you was?
Judge MiLLEDGE. Hostility on the part of the police officers in-
volved.
Mr. Halley. Were there any police officers who appeared on the
premises while the raid was in progress ?
Judge MiLLEDGE. So it was reported to me.
Mr. Halley. Did they assist the elisors ?
Judge MiLLEDGE. No. They sought to hinder them.
Mr. Halley. Can you name any of the police officers who sought to
iiinder your elisors in the service of their warrant?
Judge MiLLEDGE. I am sorry; I don't recall their names.
Mr. Halley. Would you recall a name if I mentioned it?
Judge MiLLEDGE. I doubt it. I doubt if I would.
148 lORG'ANIZED CRilME IN mTER'STATE COMMERCE
Mr. Halley. I show you a name and ask you if it refreshes your
memory [handing document to witness].
Judge MiLLEDGE. The city of Miami Beach you are speaking of ?
Mr. Halley. Yes.
Judge MiLLEDGE. I am sorry ; I don't know the gentleman and even
looking at it I am not sure. I don't recall.
Mr. Halley. But you are definite that certain police officers of
Miami Beach did impede the service of the warrant ?
Judge MiLLEDGE. Yes, if I can believe the reports, and I do believe
them that were given to me.
Mr. Halley. Thank you. I have no further questions.
The Chairman. Judge Milledge, just tell us about the problems.
You have been prosecutor and you have been a judge for 5I/2 yeai-s and
a State's attorney prior to that time and then a circuit court judge
before then. What is the difficulty ?
Judge Milledge. Well, Senator, I think it has two aspects shall I
say. There is a technical difficulty in some of it. So far as dealing
with this situation on a local level such as on the indictments of the
people whom I mentioned a while ago that doesn't represent anything
that is beyond the technical power of the local people to deal with.
There our difficulty is our unwillingness to do so, our lack of desire
to do so. We seem always to have the misfortune of having in office
at any given time some people who want to enforce these gambling
and other criminal laws dealing with organized crime, but we always
have some who wouldn't. Then the thing shifts around and in those
offices where you have people willing to do something they go out and
lackadaisical fellows take their place and the converse takes place
in some other department.
So, you always have some willing to do it and some who are not.
You never can get them organized, get the team organized at any one
time to do something. It isn't entirely the fault, in my opinion, of
any one officer. It is a combination of perhaps the judiciary, or the
judiciary perhaps are not entirely blameless in the matter.
The Chaikman. Why is the judiciary not blameless?
Judge Milledge. Well, a little fear, shall I say, of the power of the
racket people. People who hold elective offices are always apparently
a little concerned about re-election, of course, and the power of the
money that is behind the rackets and the fear of antagonizing this
business, the fear that so much money will be put behind them at the
next election that they will be defeated.
The Chairman. You mean, it is notorious in Dade County that
even candidates for the judiciary apprehend that gangsters of great
230wer and with a lot of money might be able to adversely affect their
elections ?
Judge Milledge. Of course, it is very hard for me to speak of other
people, but I would say that is a thought that exists in the minds of
most people and I can see no reason for making an exception as regards
the judiciary.
Now, I don't wish to infer that there is any corruption in that field.
I think there is corruption but I don't think it is that department.
The Chairman. Who tried the matters of criminal cases? The cir-
cuit court has jurisdiction of felonies, is that correct?
Judge Milledge. Capital felonies.
ORGANIZED CRIME IN INTERSTATE COMMERCE 149
The Chairman. How are the other criminal cases tried?
Judge MiLLEDGE. Well, there is a criminal court of record which has
jurisdiction of all felonies less than capital felonies and a court of
crimes that deals with misdemeanors. However, it has been the
practice locally for a long time, as long as I can remember, sort of an
unofficial division of this business, that although this gambling busi-
ness or violations of State laws by either gambling which is a mis-
demeanor and operation of a gambling outfit which is a felony if those
things occur within municipal limits they are treated as violations of a
municipal ordinance, I presume to get the revenue from the fines. So,
the only prosecutions that are had are had under the municipal ordi-
nances and the court uses the procedure of fine with the person fined
going back and operating all over again.
Now, that part of it is simply one of attitude. However, I believe
this is a field in which no matter how much people try there is extreme
difficulty if not impossibility in coping with certain aspects of this
thing as I found out myself in trying to ferret out some information
about this wire service and as a result of which I drew the act which
is presently the law of the State, presented in 1945 and 1947 and
finally passed in 1949.
In the course of that investigation I found it impossible to get
hold of some of the people that I wanted to reach. For example,
there would be a contract made for a leased wire from say New-
York to Miami. The contract was made by people who aren't here
and whom I couldn't reach. Of course, I had difficulty in reaching
people who were presumably here. For example, ther& w^ere certain
names with which I got familiar but wdiose faces I was never able
to see and I was never able to get process served on them because
when process was turned over to the officers they told me, "We heard
of those names, but we have never seen their faces."
There were names like Walter Keough and Haggerty. Their names
appeared on papers of dealing with these wire services and I think
there was somebody named O'Brien. I would hear about these people
but I never could and had no means of apparently ever being able
to get hold of those people and get them either before me on the
processes of the State attorney or the processes of the grand jury.
You are greatly handicapped when you find what you need in
order to protect the interests of the State of Florida and you can't
even get hold of the people whom it is necessary for you to get hold
of in order to lay out some kind of a program, legislative or otherwise.
So, on that aspect of it when you get into this part of it that is
interstate I think you will find that thoroughly honest and unques-
tionably competent men like the present attorney general of Florida
are up against some insuperable difficulties because of the power,
because the power extends as far as the State line and the other end
is always someplace else and he can't get hold of it. And, to a limited
extent I found that was true, too.
The Chairman. So, at least as to the interstate use of wire serv-
ices in connection with gambling and criminal activities you feel
that the only way it can be handled is by the Federal Government
putting some blocks in the way ?
Judge MiLLEDGE. Yes. I think there are a few people who hon-
estly would ask the Federal Government to take over the whole field
of organized gambling, but I don't think it is necessary. However,
150 lORGANIZED ORilME IN INTERSTATE COMMERCE
a thing like this wire service, communications without which there
can hardly be any large scale gambling I think would be extremely
difficult, if it is too much to say impossible, for the State to handle
because the thing you are trying to deal with is not confined to the
State. I think it is the same problem as interstate commerce or
anything else.
The Chairman. Judge, I have your quotation of the comment you
made charging the Dade County Grand Jury which I think is some-
what of a gem and I would like to read it to you and see if you made
this statement :
Going to the multiraillion dollar rackets they could not exist unless officers
charged with law enforcement were not afraid of gang overlords' money than
the people who elected them.
Is that what you said ?
Judge MiLLEDCxE. I certainly did and nothing has happened since
to change my mind.
The Chairman. You think that the people charged with law en-
forcement here in this section are more afraid of gang overlords than
they are of the people who elected them ?
Judge MiLLEDGE. Yes. I think that is perhaps changing a little
bit. I think public opinion here is changing for the better.
The Chairman. So I take it the chief difficulty has been in the
enforcement branch, that is, the people who have to enforce the law,
the sheriff and the police department, or, would you specify where
your chief difficulty has been ?
Judge MiLLED(3E. Well, personally I do not mind specifying, Sen-
ator, but I would rather you would excuse me from not being any more
specific about it.
As I heard Mr. Morris say a while ago, of course, the sheriff is the
chief law-enforcement officer but frankly I don't think you can lay
everything at the sheriff's door. I think the responsibility has to be
divided a little bit more than that. Our municipal police, our prose-
cutors, and our courts, they are all a team of law enforcement and if
you get the whole team working, I mean, if you do not get the whole
team working it is very difficult to get anything done.
The Chairman. The public too is a part of the team, isn't it?
Judge MiLLEDGE. Yes.
The Chairman. Senator Hunt?
Senator Hunt. Judge, do your State laws set out, as in some State
laws, that where a sheriff or a prosecuting attorney has cognizance
or is aware of violations under his jurisdiction, whether a complaint
is made or not, he himself is subject to fine and imprisonment if he
doesn't prosecute on his cognizance ?
Judge MiLLEDGE. I know of
Senator Hunt. Your law doesn't provide that?
Judge MiLLEDGE. I know of no specific provision of that character.
Senator Hunt. It would be rather helpful if you had that law in
your Florida law books, wouldn't it ?
Judge MiLLEDGE. Yes ; I believe it would. Senator. I think it would
help.
Senator Hunt. I noted in last night's paper that your State Senate
now is taking an interest in this matter and has appointed a com-
mittee of thi-ee to look into the situation to see what the State itself
ORGANIZED CRIME: IN INTERSTATE COMMERCE 151
can do on this matter. I will leave this thou<^ht, so that perhaps yovi
mi^ht want to sn^ifgest any laws that might help the situation.
Judge MiLLEDGE. Thank you very much. I certainly will pass that
on.
Senator Hunt. Judge, you speak of being unable to get in contact
with or subpena those people operating on a Nation-wide basis. How-
ever, I am sure you do feel that those people cannot operate Nation-
wide and into Florida without their local contacts here.
Judge MiLLEDGE. That is true, of course.
Senator Hunt. Let's talk for a few minutes, Judge, about the eco-
nomics of the situation. Do you have many people in this area who
think that gambling brings business or creates business or promotes
prosperity or is good for the community ?
Judge MiiXEDGE. Yes ; we do, but we don't have nearly as many of
them fortunately as we used to have. I believe at one time, perhaps 10
years ago, it would be fair to say that a majority of the people here
felt that way. Whatever they thought about the other aspects of it
tliey tended to blink at it as a sort of economic necessity, as I suppose
some of us do about the Florida divorce laws as that sort of thing. I
am certain, however, that the proportion of the people who believe
that is rapidly diminishing and I would venture the guess that the
majority of the people here now are convinced that it is an economic
loss.
Senator Hunt. Well, take here in this area^ — we had some figures on
it — it goes up to millions yearly and I think the people of your com-
munity if they don't understand should know that that "take'' doesn't
stay in Florida, that it goes to the heads of the syndicates primarily
in New York, Cleveland, Chicago, and Los Angeles, and so forth.
Just for the information of the public here in Florida, you do have
here in Florida a sales tax, don't you ?
Judge MiLLEDGE. Yes.
Senator Hunt. I will make the statement, and this is based on
actual ex])erience, that if you could eliminate gambling in this area
you would find that those millions, roughly estimated at $15,000,000
a year from this particular area would go into legitimate channels of
trade. It would not only be far more beneficial to your merchants
and to your general business activities than the money that is spent
on gambling, but it would also be very beneficial to your local gov-
enunent. Not knowing how your taxes are divided, if it all goes to
the State or not, I say it would be most helpful if a tax could be col-
lected on that vast sum of money that goes out of your State for
gambling, that if you didn't have gambling it would go into legitimate
trade channels.
I make this statement advisedly because I had the same experience
in my State where we watched it carefully, and where gambling was
closed down the sales-tax situation and general business conditions
improved, and improved immediately.
I think that might be a thought that you might get over to your
people that would be somewhat helpful.
Judge MiLLEDGE. I am sure it will.
Senator Hunt. I haven't any other questions.
The Chairman. Judge, do the other members of the judiciary in
Dade County in this section share your general views about the prob-
lems you have testified about ?
68958 — 50 — pt. 1 ill
152 ORGANIZED CHIME' IN" INTERSTATE COMMERCE
Judge MiLLEDGE. I am not sure, Senator. I believe tliey do.
The Chairman. Judge, we appreciate your appearance before the
committee and thank you for the information you have given us.
TESTIMONY OF DANIEL P. SULLIVAN, OPERATING DIRECTOR,
CRIME COMMISSION OF GREATER MIAMI
The Chairman. Mr. Sullivan, do you solemnly swear that the
testimony you will give this committee will be the whole truth and
nothing but the truth, so help you God ?
Mr. Sullivan. I do.
Mr. Halley. What is your occupation, Mr. Sullivan ?
Mr. Sullivan. I am operating director of the Crime Commission
of Greater Miami.
Mr. Halley. Would you state for the record what the Crime Com-
mission of Greater Miami is; what is the organization, its organiza-
tion, and so forth?
Mr. Sullivan. The Crime Commission of Greater Miami is a civic
organization that was founded by representatives of about 90 civic
clubs. They held a law-enforcement session in the Mayfair Theatre-
in March 1948. That session was addressed by Attorney General Tom
Clark, and the delegates at that convention by actual vote agreed to
form a law-enforcement agency, a crime commission, for the purpose
of engendering a better respect for law and attempt to get better law
enforcement in this area.
Mr. Halley. When did you become the operating director ?
Mr. Sullivan. In August 1948.
Mr. Halley. Will you state for the record your experience and
qualifications prior to becoming operating director of the Crime Com-
mission of Greater Miami ?
Mr. Sullivan. I was special agent of the FBI, supervisor and agent
in charge for IQi/^ years, beginning with 1932 up to the latter part'
of 1942.
Mr. Halley. By "the FBI" you mean the United States Department
of Justice, Federal Bureau of Investigation ?
Mr. Sullivan. That is right. Subsequently, I was director of plant
protection at the Consolidated-Vultee Aircraft plant here in Miami
all during the war, having charge of the responsibility for the investi-
gation of sabotage and antiespionage and plant security and investiga-
tion at the plant. I subsequently was employed as chief investigator
by the Florida State Racing Commission during the year 1945-46.
Mr. Halley. Mr. Sullivan, have you prepared certain exhibits show-
ing the known gangsters living and operating at Miami Beach?
Mr. Sullivan. At Miami Beach and elsewhere in Dade County and
in Broward County.
Mr. Halley. Would you produce those charts ?
Mr. Sullivan [produces three charts] . This exhibit (No. 109, p. 740)
is not to scale. It was designed to give the committee an idea as to the
general location of the major gambling operations in Broward County
in relationship to the city of Miami and the general area. The center
of that chart shows the United States Federal Highway, which is the
principal highway running north out of Miami. Just beyond, a
matter of a hundred feet or so, north of the Dade County line, iiii
ORGANIZED CRIME IN INTERSTATE COMMERCE 153
Broward County, on the right side of the highway is located the
Colonial Inn. Immediately next to the Colonial Inn is the Gulf stream
Kacetrack, which goes to the corner of the United States Federal
Hif^hway and Hallandale Beach Road. The Club Greenacres is located
about a mile and a half west of the United States Federal Highway
on the Hallandale Beach Koad, and almost directly across from the
Gulfstream Racetrack -property is located what is called the Farm.
Going east from the Federal Highway about a mile and a quarter,
toward the ocean, is located the CUib Boheme. These three places-
Colonial Inn, Greenacres, and Club Boheme— are the three principal
gambling operations in Broward County.
I might say that the Colonial Inn here is not operating as a gambling
place. In the spring of 1948 an injunction suit was brought against
it, and an injuction was granted and it closed gambling. It has since
been run as a dance hall or night club for the last two seasons. The
property was formerly owned by Jake Lansky, of Broward County.
The Club Boheme subsequent to May 1948 began gambling opera-
tions with the same gi-oup that formerly controlled the gambling at
Colonial Inn.
Mr. Halley. In your subsequent testimony you will identify the
people that you are talking about?
Mr. Sullivan. Yes. I just merely want to give you the general
picture now. The Club Greenacres is operated by generally the same
group which formerly was connected with the Colonial Inn but who
subsequently took over the gambling at the Club Boheme. The
Farm is a large abandoned night club and gambling house. Orig-
inally it was called the Plantation. In the late thirties it burned
down. Subsequently a new building was placed on it, and they called
it the Farm in the year 1939. In 1940 an injunction suit was brought
against it for gambling operations, and a permanent injunction was
granted.
In the year 1945-46 I was with the State racing commission and
I made an investigation of wire service. At that time I found that
the service was originating in Baltimore, Md.-, and a line was running
all the way down through Maryland, Virginia, North Carolina, South
Carolina, Florida, and into Miami. On this line there were certain
drops where customers took the service from the wires and then dis-
seminated it locally. At that time the principal places for the dis-
semination of the information received from this line, and which was
broadcast by the local distributors to bookies, were located at two
points: One in Dade County at the Dade County Newsdealers on
Northwest First Court across from the courthouse, and the other place
was located at the Farm. The information that comes in on this wire,
which is a drop wire, is received by ticker. The local distributor then,
through an arrangement at that time made with the Western Union
Co., obtained leased wires, and through the Western Union connected
the customers, generally made up of bookies, with the Western Union
frame. Then at the location where the information is received over
this interstate wire there would be a hook-up whereby a man or an-
nouncer could speak into a microphone and that microphone was in
turn connected with the multiplicity of wires appearing on the frame
of the Western Union, so that his voice could be heard simultaneously
in gambling places and any other places which might pay for this
service. The Farm at that time was set up so that this simultaneous
154 ORGANIZED CRIME' IN INTERSTATE COMMERCE
broadcast to bookies could be made from that location as well as at
the Dade County Newsdealers. It was explained to me that the pur-
pose of that was so that, in the event the county authorities of Dade
County should by some action interfere or interrupt the wire service
here, it could be carried on from the broadcast emanating in Broward
County at the Farm.
In the year 1946 there was one service company that brought in the
wire service and distributed it. It was called the Hollywood News
Service. It changed its name to Miami News Service. Early in that
year there was a service started up in the name of Trans-America
News & Publishing Co., which was a Chicago-operated race-wire serv-
ice, running in competition with the established Continental Press. A
leased wire was established from Cicero, 111., to a place located in Miami
Shores, just north of Miami, at tlie Graham Press. Another wire tele-
meter line from the Graham Press to New York City and return was
also established at that location. The Trans-America went into busi-
ness and subsequently, early in the year, around June or July 1947,
after Trans- America was established and had established other similar
services in other parts of the country, and after James Ragan was
killed, they announced that they would retire from the wire-service
business. At that time the facilities that had been established in the
Graham Press were not released. These facilities were turned over
and made a part of the established Continental Press Service.
At the present time I believe I am right in saying that the Graham
Press is not used as a major distribution point for the dissemination
of racing information. It is merely used as a drop, one of several
drops. In 1946 there were approximately 22 outlets in the Greater
Miami area for wire service. Within a year that number liad jumped
to between 120 and 125 in the period of 4 years.
Mr. Hallet. In the meantime wire service was made illeaal in the
State of Florida?
Mr. SuLLTVAN. This was up to the time they cut them hist year, in
December 1949. I think there will be testimony to the effect tluit tlie
wire service was cut off throughout the State.
The identities of the individuals that are connected with Colonial
Inn, Club Greenacres, and the Club Bolieme, I think, can probably
be handled in the next chart.
The Chairman. We would like to have this chart and the succeeding
charts marked as exhibit Nos. 108, 109, and 110 to the testimony of this
witness. (See appendix, pp. 740-742.)
Mr. Sullivan. I would like to stress the fact that the Graham Press
is not to my knowledge a bookmaking operation; it was merely one
outlet.
Mr. Halley. That is the Graham Press ?
Mr. Sullivan. That is right — the Graham Press.
Mr. Sullivan. Now, this chart (exhibit No. 108, ]). 741) is generally
concerned with the major gambling operations in Broward County. It
shows certain points of gambling o])erations in Palm Beach and Dade,
Counties. The Colonial Inn was a major gambling o))eration in Bro-'
ward County until it was closed in May of 1948. The gambling in that
l)lace was controlled by Jake Lansky and his brother, Meyer Lansky ;
Joseph A. Doto, alias Joe Adonis, Vincent Alo, alias Jimmie Blue Eyes,
ORGANIZED CRIME! IN INTERSTATE COMMERCE 155
Frank Erickson, Bert Brings, Claude Litteral, and Samuel L. Bratt.
Originally, this gambling operation was a joint venture between this
group of New York gamblers and a group of Detroit gamblers. That
existed up through the year 1946. A group of Detroit gamblers, headed
by Mert Wertheimer, Reubin Mathews, and Danny Sullivan, had about
321/2-percent interest in the
The Chairman. I take it that you do not hesitate to explain that
he is not of your branch of the Sullivan family ?
Mr. Sullivan. He is Red Irish. They controlled 321/^ percent of the
operation of the Colonial Inn. Subsequent to that year the interest
of that particular group of Detroit gamblers was taken over and
absorbed by the remaining operator from New York. The o})-
erations of the Colonial Inn are akin to the operations in the Club
Greenacres. Ninety percent of the ownership of Greenacres is in the
operators of the Colonial Inn. The other 10 percent of the Club
Greenacres is divided among two other operators who do not appear
in the Colonial Inn. The Club Greenacres is considered or has been
considered in past years as a sawdust joint, but in recent years it
has been dressed up and it more or less caters to the big-time gamblers.
The principal income from the Greenacres comes from the "money
crap game," the New York crap game, and that New York crap game is
controlled by William G. Bischoff, alias Lefty Clark. Joe Massei, of
Detroit, bankrolled Bischoff.
Mr. Halley. The chart shows that both of them lived in Detroit ;
is that right ?
Mr. Sullivan. Yes.
Mr. Halley. Does one of them maintain a local residence and place
of business in Miami ?
Mr. Sullivan. Yes; but I would like to reach that later on,
Mr. Halley. Will you reach that later on ?
Mr. Sullivan. Yes. These same two men, as will appear on this
chart, are interested in the gambling operations in ^liami Beach
called the Club Collins, located at Twentieth and Collins Avenue,
Miami Beach. That club operated up until 2 months ago. The
principal game was "skin game," and in that were Jack Friedlander,
Newark; Joseph Massei, Detroit; William Bischoff, alias Lefty
Clark, Detroit ; Trigger Mike Coppola, New York City ; and Bennie
Kaye, New- York City.
Friedlander, one of the operators of the Club Collins, also is a part-
ner in the Island Club gambling house located at Sunny Isles in
Dade County, in the county area. That operation is controlled by
Jack Friedlander, Samuel P. Cohen, a member of the S. & G., Herbert
"Pitsy" Manheim, of Detroit, and Sam Gameboy Miller, of Cleveland,
Ohio. Up to the year 1948 Frank Erickson and Bert Briggs each had a
15 percent interest in the Club Greenacres and the Colonial Inn op-
eration. In turn Erickson controlled the gambling casino concession
at the Boca Raton Club in Palm Beach County.
Erickson's operations in Dade County have been carried on at the
Wofford Hotel, beginning in 1941 through 1946. Also at the Roney
Plaza Hotel for a part of one season and at the Boulevard Hotel from
1946 to 1950. The gambling operations of Erickson at these three
places are not similar to the normal gambling operations found in the
hotels on Miami Beach. They have gambling concessions at most of
156 lORG'ANIZED CHIMB IN INTERSTATE COMMERCE
the hotels and these concessions are leased out for sums ranging from
$2,500 to $50,000 per season. That is merely a gambling monopoly
given to one or more men who have the privilege of establishing book-
making operations within the hotels and the cabanas outside of the
hotels.
Erickson's interest in the Wofford Hotel was not in the gambling
concession in the hotel. That was used as headquarters for his agents,
consisting of Bert Briggs, L. A. Cantor, and Jackie Zeldow. Erickson
used the Wofford Hotel as a base of operations for the handling of
large lay-off bets or moneys received by him in New York, New Jersey,
and possibly at other points. Some of that money, of course, would
be taken to the racetrack and put through the mutuel machines.
That was done for the purpose of laying off bets wagered on a partic-
ular horse. That was more or less a headquarters for the racetrack
activities of Erickson and his agents. The same condition existed at
the Boulevard Hotel. The Eoney Plaza Hotel, however, was con-
sidered to be a gambling concession. That was taken over for the
purpose of accepting gambling bets from customers located inside the
hotel and in the cabanas outside on the ocean.
The operators of the Colonial Inn are reflected in the operations
of the Louisiana Mint Co. — the joint gambling operations of that
company are between that company and Phil Kastel and Jack Lansky,
of Broward County. Phil Kastel is of New Orleans.
There has been testimony put in the record in a previous hearing
as to the principal gambling operations of the Frank Costello Syndi-
cate in the New Orleans area, particularly in the slot machine business.
I think that more or less generally covers the background of the
gambling phase.
(Puts up third chart.)
Mr. Sullivan. This chart shows three hotels on Miami Beach — the
Wofford Hotel, the Grand Hotel, and the Sands Hotel. These three
particular hotels were selected to identify the various persons who
frequented and used these hotels as a meeting place.
The history of the Wofford Hotel is found m a lease that was signed
by Thomas J. Cassara and Neal Lang of Miami Beach on November
1, 1940, for a period of 10 years.
Cassara is an attorney. He graduated from the National Law
School in Washington and he lived in New London, Conn. Neal Lang j
was at that time manager of the Raleigh Hotel in JNIiami Beach, and '
Cassara was also there employed.
Lang, in a subsequent suit filed in the circuit court, declared that
he never had any interest in the operation of the Wofford Hotel, that
he signed the lease merely as an accommodation, and that he did so at
the instance of Tom Cassara. The hotel was operated by Cassara for
a period of 1 year, and then subsequently there was a contract signed
between Abe Allenberg and Frank Erickson whereby they agreed to
put up certain money to Cassara and take over the operation of the
hotel. Ten thousand dollars was put up by Allenberg and ten thou-
sand by Frank Erickson.
In the year 1940 Cassara had arranged for the building of a hotel
called the Raleigh Hotel in Miami Beach. Testimony in a case in
the circuit court was to the effect that he borrowed $25,000 from John
Angersola, alias John King, of Cleveland, Ohio. He also testified that
,0RGANIZE1> CRilME IN INTERSTATE COMMERCE 157
hv had at different times borrowed money in different sums and at
(liti'erent places from Jimmie Kelley, the father-in-law of Anthony
Ciirfano, alias Little Augie, and several others. The testimony was
tluit Anthony Carfano personally had no interest in the hotel. How-
ever, in the year 1941 Cassara left and went to Chicago. Abe Allen-
l)erg became resident manager of the hotel and Max Marmorstein be-
came the manager and operator of the hotel. Max Marmorstein is a
liotel operator from Cleveland, Ohio. He maintains his office in the
Ninth and Chester Building in Cleveland, Ohio, and his telephones
were taken out of that office in 1943 because they were connected with
gambling operations. That building is the headquarters of the Em-
pire News Service controlled by "Mushy" Wexler.
Subsequent to 1941 Otto Lorentzen, a nephew of John Angersola,
John Cardone, another relative of John Angersola, Abe Allenberg,
Max Marmorstein, John Angersola and a brother, Fred Ang,ersola,
and Anthony Carfano were set out as being partners in the operation
of that hotel. Carfano himself signed correspondence from the hotel
as managing director. The hotel thereafter became a meeting place
for well-known racketeers and gangsters from all over the country.
Erickson, Bert Briggs, Al Cantor, Jackie Zeldow, and Frank
Strader used the Wofford Hotel as their headquarters for their "on-
track" gambling operations.
At that hotel large private gambling games took place. The par-
ticipants in these games were, among others. Little Augie; John
Angersola, alias John King ; Joe Massei, of Detroit ; Charles Fischetti,
of Chicago ; Angelo De Carlo, alias Gyp De Carlo, New Jersey ; Alfred
"Big Al" Polizzi ; Max Welsberg ; Alfred "Poagy" Toriello, of New
York City and Providence; Joe Burnstein, of Detroit; and Trigger
Mike Coppola of New York City.
Among the clientele, guests, and associates who frequented the place
were Joseph A. Doto, alias Joe Adonis ; Meyer Lansky ; Vincent Alo,
alias Jimmie Blue Eyes, from New York City; Frank Costello; George
Angersola, of Cleveland ; Romeo Civetta and Tony and Carlos Civetta,
all of Cleveland, Ohio; Alfred Polizzi, Cleveland; Abner "Longie"
Zwillman, Newark, N. J. ; Nick Delmore, Elizabeth, N. J. ; Nick Bravos,
Chicago ; Willie Moretti, Bergen County, N. J. ; Joe Di Carlo, of
Youngstown, Ohio; Joseph Jasper Aiello, alias Fats, of Youngstown;
Nicholas P. Tamburello, alias Nicoline, Youngstown ; Frank De Fil-
lipo, New Jersey; Herman Stark, of New York City; William G.
Bischoff, alias Lefty Clark, of Detroit.
I have the criminal records here of all of them.
The Chairman. We would like to have these all filed as one exhibit
to your testimony.
(The photographs and criminal records referred to by Mr. Daniel
Sullivan are on file with the committee as exhibit No. 111.)
Mr. Sullivan. I have here a number of them, which I won't go
over. I will turn them over to the reporter. I have some other things
I could mention in passing. For instance, I have a photograph of the
home of John Angersola, 5440 La Gorce Drive, Miami Beach. Fla.
I have a photograph of the home of Charles Fischetti, 6475 Allison
Road, Allison Island, Miami Beach, Fla. ; a photograph of the home
of Alfred "Poagy" Toriello, of New York City and Providence, at
8842 Hawthorne Avenue, Surf side, Fla.
158 lORG'ANIZED ORIEVLE IN IjVTE'R'STATE COMMERCE
The Chairman. Let us not mix them up, but if any of the members
of the press want to make duplicates of the photographs of any of the
palatial homes they have the committee's permission to do so. Pass
them around to the ijress tables.
Mr. Sullivan. Among the persons that I mentioned in this testi-
mony was Joe Burnstein, of Detroit, Mich. Burnstein is one of three
brothers, concerning whom there has been some testimony, I believe,
before the committee. He has been located here at different times
in the Miami area, and in the past years he was part owner of the
lounge at the Albion Hotel. Telephone calls have been traced from
Mickey Cohen's telephone in New York City to the telephone located
in that lounge.
In the year 1949 Burnstein became the manager of the Max Cohen
Distributing Co., a beer distributorship in Miami, and he left town
after the organization lost about $7,000 or $8,000. At least he went
into debt and left town, owing creditors to that extent.
He went to California to join his brother, Izzy Burnstein, who
owned a string of horses on the west coast, and was back in Miami
Beach this past season.
The residence of Vincent Alo is located at 1248 Monroe Street,
Hollywood, Fla.
The Chairman. Is that alias "Jimmy Blue Eyes" ?
Mr. Sullivan. Alias "Jimmy Blue Eyes." Joe DeCarlo, who was
mentioned in this narration of the persons directing the Wofford
Hotel, is the same individual who has transferred his operations from
Buffalo, N. Y., to Youngstown, Ohio. He did this in the year 1945.
In Youngstown he associated himself w^itli Joseph "Fats" Aiello and
with Charles "Cadillac Charlie" Cavallero and Nicoline Tamburello.
In Youngstown they organized the numbers and horse-book-making
racket in conjunction with a man by the name of Ray Lanese.
Ray Lanese, according to the chief of police of Youngstown, Ohio, is
a nephew of Joe Massei, and has been operating the Italian Village
Restaurant on Twenty-third Street, Miami Beach, which has been
a place where a great many of these characters frequent.
The residence of Nick Delmore, of Elizabeth, N. J., is at Terracina
Avenue, Golden Beach, Fla. It is a new home, just recently built, and
completed in the last few months.
In conjunction with Angelo "Gyp" De Carlo (De Carlo is a well-
known gambling operator) he has operated the Chatterbox Night
Club in the vicinity of New Brunswick, N. J. De Carlo and William
"Fats" Riga are owners of the DeRiga Trading Corp. That company
owns a large subchaser, which was converted here in Miami Beach 2
years ago and which was refrigerated, and is now used for fishing.
Associated with them in this enterprise is Frank De Fillipo, who
comes from their same general area in New Jersey.
The residence of Sam De Carlo, of Buffalo, N. Y., is located at 6166
Pinetree Drive, Miami Beach, Fla.
The operations of the Wofford Hotel connect with the operations
of tlie Grand Hotel. John Angersola, of Cleveland, appears as one
of the creditors of Thomas J. Cassara, operator of the Wofford
Hotel.
Fred Angersola, his brother, and Beiinie Street signed a lease on the
Grand Hotel in the year 1944, which lease terminated in the fall of
.ORGANIZED CRIME IN INTERSTATE COMMERCE 159
last year. Thomas Cassara was also interested in tlie operation of the
Grand Hotel. In fact, he was the owner of record of that property
until the year 1937, at which time he sold it. Then, subsequently, he
became the lessee of certain night clubs. They had two night clubs
connected with that property. Along with John Angersola ancl his
brotlier, Fred Angersola, they signed a lease on that property in the
year 1!>40, extending for a period of 5 years. Subsequently, Cassara
in 1941, in the same year that he left Miami Beach and left the Wofford
Hotel, withdrew his connection with these night-club operations.
The opei-ations were not too successful, and for several years the
night clubs did not operate. This past year one of them did operate
under the name of Chez Paree, and is still in operation as a strip-
tease night club.
The lease on the Grand Hotel, although in the name of Thomas
Cassara and Fred Angersola, did not reflect the true ownership of all
of the parties concerned. In 1944, in connection with the 5-year
lease that was given to Fred Angersola and to Bennie Street, there
was required that the sum of $39,000 be put up as deposit on the lease ;
$15,000 of this money was put up by Bennie Street; $16,500 was put
up by Fred Angersola ; and $7,500 was put up by Joe Massey (Massei) ,
whose name does not appear on the record as having any interest in
this hotel.
Subsequently, Joe Massey took up his residence in the penthouse
of that hotel. In more recent months he has been living at a new
home just constructed at 520 Lakeview Drive in Miami Beach.
In the year 1946 Dave Glass, a numbers operator and a horse-book
operator from Philadelphia, joined Bennie Street, likewise a horse-
book operator, in taking over the lease on the Sands Hotel. That
lease required the putting up of a deposit of $90,000 in rent money.
The lease was signed, and that hotel has been operated by these two
men since that time. Dave Glass himself has operated a gambling
concession at that hotel.
The hotel became a gathering place, particularly, for a group of
gamblers, racketeers, gangsters, from Philadelphia, Pa., headed up
by Nig Rosen. Nig Rosen heads up a mob of about 25 or 30 men who
operate in the Philadelphia area. Rosen himself has headquarters in
New York City, where he is the operator of the Dearest Miss Dress Co.
His first lieutenant is Max Weisberg, alias "Willie" Weisberg. His
second in command is Samuel "Cappy" Hoffman,
The photographs and criminal records of Rosen, Weisberg, Max
Rothman, Nussie Rosen, Max Seigal, Samuel "Cappy" Hoffman, Mi-
chael Matteo, Frank Matteo, Anthony Narcissi, Harry Provan, Harry
Siegel, Irving Greenberg, Joseph Herman, Abe Glassman, Moe New-
man, and Jack Newman I have here, and they are available to be
introduced in the testimony.
The Chairman. All right, sir.
Mr. Sullivan. The operations of this particular group centered at
the Sands Hotel. In the year 1946, when this lease was signed and
the hotel operation was taken over by Street and Glass, there were
very few of these men who showed up. In the season of 1948-49, a
year ago, however, the whole group that I have mentioned made this
place a headquarters. They had taken over the gambling operations
and iramblinir concessions at a number of hotels in Miami Beach but
160 ORGANIZED ORIDVIE DST INTERSTATE OOQVIME'RCE
used the Sands Hotel more or less as a headquarters for their gambling
operations.
Closely associated with them at the Sands Hotel was Jack Fried-
lander, of Newark, N. J., Marco Reginelli, of Camden, N. J. (also
known as the Little Guy), who also appeared to be a party in interest
in their gambling operations. William Moretti, alias "Willie Moore,"
of Bergen County, N. J., was frequently at the hotel with Nig Rosen.
In February 1949 the wire service was shut off in the Miami Beach
area. On the Sunday subsequent to that shut-off there was a meeting
at the hotel at which Marco Reginelli, along with Nig Rosen and a
very few others in this same mob, attended.
The history and the connections of this gang, I believe, can be found
in a letter from the Philadelphia police department, dated July 19,
1949, in which their history and the general history and the operations
of this crowd in the Philadelphia area is set forth by Mr. Frank Rich-
ardson, assistant superintendent of police, commanding the detective
division of the Philadelphia police department. Among the other
general statements as to the operations of this gang, he mentions the
fact that they headquarter at Miami Beach during the winter season,
where they maintain gambling operations.
He goes on to tell their general background from the time that they
started their operations back in the early twenties, during the pro-
hibition era, and established themselves as bootleggers and rumrunners
and the principal gangsters in the Philadelphia area.
The Chairman. That will be made an exhibit to your testimony
and will be a part of the record.
(The letter referred to was marked "Exhibit No. 112" and appears
in the appendix on p. 743.)
Mr. Sullivan. Among the persons connected with the Sands Hotel
as having a financial interest and who was referred to by the employees
of the hotel, was Alfred Polizzi, "Big Al" Polizzi, of Cleveland, Ohio,
as distinguished from Albert Polizzi, "Chuck" Polizzi, of Cleveland,
who was reported to be a cousin of Alfred Polizzi. A photograph and
criminal record of Alfred Polizzi is here, and I would like to introduce
it into the record.
The Chairman. It will be made a part of the record.
( Exhibit No. Ill is on file with committee.)
Mr. Sullivan. In recent years Polizzi has moved to the Miami area,
where he is now engaged in the construction business. He has been in
association, however, with "Little Augie" Pisano and the various
other persons who frequented the Wofford Hotel. He is the owner
of the Wood Duck, a yacht which is anchored at the Miami Beach boat
slips. That boat is registered in his name, under Coast Guard No.
41J198. That same boat was registered prior to July 23, 1940, to
Arthur B. McBride, of Cleveland, Ohio, who was either at that time,
or shortly thereafter, the sole owner of the Continental Press wire
service.
On July 23, 1940, according to tlie records of the Coast Guard,
Arthur McBride transferred title of this boat to Fred Angersola, alias
Fred King, the same man who was the lessee of the Grand Hotel, and
whose brother has been active in the operation of the Wotford Hotel.
On August 15, 1941, Fred Angersola transferred this boat to one
Charles K. Green, whose identity is not known to nie. Five days later.
ORGANIZED CRIME IN INTERSTATE COMMERCE 161
on August 20, 1941, the boat was transferred under United States
Customs No. 241036, as an undocumented vessel. The information on
that transfer of title is not known, but the next notation in the Coast
Guard files reflects that this boat was sold by Amy King, who is the
wife of John King, to Alfred Polizzi on June 3, 1944.
The association of John Angersola and Polizzi is reflected in photo-
stat of deed in the real-estate records of Dade County, in deed book
2843, page 494, which reflects the transfer of certain lots in the Riviera
section of Coral Gables, jointly held by John Angersola and his wife,
Amy Angersola, and Alfred Polizzi and his wife, Philomena Polizzi.
The Chairman. That will be made as an exhibit to your testimony,
(The deed referred to was marked "Exhibit No. 113" and appears
in the appendix on p. 746.)
Mr. Sullivan. In addition, Polizzi has owned considerable other
property in the Coral Gables area. On July 29, 1946, M. F. Pafford
and his wife, Mildred C. Pafford, and George H. Newsome and his
wife, Mary J. Newsome, and Harry W. Shank and his wife, Goldie F.
Shank, transferred title to the entire subdivision, known as University
Estates of Coral Gables, jointly to Arthur B. "Mickey" McBride and
Alfred Polizzi. A photostatic copy of this deed is offered.
The Chairman. It will be made a part of the record and an ex-
hibit to your testimony.
(The deed referred to was marked "Exhibit No. 114" and appears
in the appendix on p. 748.)
Mr. Sullivan. A photograph of the subdivision which is located
near the Ponce de Leon High School in Coral Gables is offered.
The Chairman. It will be received.
(The photograph referred to was marked "Exhibit No. 115" and
is on file with the committee.)
Mr. Sullivan. In the year 1939 a major investigation of the num-
bers racket was conducted by the Cleveland police department. As a
result of that investigation 19 persons were indicted. Among the
persons indicted was a man by the name of Scerria, who fled to Mexico.
John Angersola was also indicted, and one of the brothers, either
George or Fred Angersola.
Six of the indicated men used the "Wood Duck in fleeing the juris-
diction of the court in Cleveland and in going to the Great Lakes and
passing down through the inland waterway to the Miami area. In
1941 the case was brought to trial, and the brothers were acquitted.
The investigation had to do with the investigation of extortion in
connection with Negro numbers.
It does not show on these charts but there has been a very close
connection between the persons who have frequented as clients or
patrons or customers of the Wofford Hotel and the Grand Hotel. As
a matter of fact, the Grand Hotel, located on Twenty-third Street,
is only about two blocks away from the Wofford Hotel, and the same
persons who either were patrons of, or frequented, the Wofford Hotel
also frequented the Grand Hotel, and that area around the Grand
Hotel became nationally known as a meeting place probably for more
nationally known racketeers and gangsters than any one local area in
the United States.
The investigations that we have conducted, and which cannot pos-
sibly be gone into fully here, disclose a tremendous amount of property
162 ORGANIZED CRIME IN INTE'R'STATE COMMERCE
that has been accumulated by racketeers from all parts of the country,
particularly those east of the Mississippi River. The money that is
poured into legitimate busineses, in hotel investments, and so forth,
is most difficult to trace.
The Chairman. Mr. Sullivan, the matter of money placed in legiti-
mate businesses by these people is one of the primary parts of the
inquiry of this committee. I know that you have already furnished
the committee with very substantial infoniiation. I will ask
that you document all that you have, and that will be made a part of
your testimony and part of the record of this committee. We fully
realize that going into the details of each one of these investments at
this hearing would consume too much time, and so we will handle it
in that fashion, but your documentation will be made public when
it is completed.
Mr. Sullivan. For instance, in the case of Joe Massei, of Detroit,
he has spent the great bulk of his time in Miami Beach for the past
10 years. His interest is disclosed in the lease on the Grand Hotel.
His ownership of his home at 520 Lakeview Drive, a tremendous home,
discloses his interest. He is a one-half owner of the Miami Provision
Co., which is one of the exclusive provision companies located in
Miami, and of which there is a photograph here.
The Chairman, All of these will be made exhibits to your testi-
mony and a part of the record.
(Exhibit No. Ill, on file with committee.)
Mr. SiTLLivAN. He is the owner of the yacht Verjo II, which is stored
at the Miami Beach boat slips.
The Chairman. Who is this you are referring to ?
Mr. Sullivan. Joe Massei.
The Chairman (indicating document). And this is his criminal
record ?
Mr. Sullivan. That is his criminal record, and there is the photo-
graph of the Italian Village Restaurant, located on Twenty-third
Street, which is operated by his nephew, Ray Lanese, who was con-
nected with eloe De Carlo in the operation of the numbers and book-
making in Youngstown up to the year 1948.
William G. Bischoff, alias "Lefty" Clark, who is nationally known
as an outstanding crap dealer and operator of crap games, and who
is interested with Massei to the extent of 40 percent of the net income
from the Club Green Acres, makes Miami Beach his home. He resides
at 4383 North Meridian Avenue, Miami Beach.
The connection of Massei with the rackets in Dade County is not
known other than through his backing of the operations of "Lefty"
Clark, However, our investigations have reflected that Joe Massei
controls large-scale numbers operations and horseracing books in the
Detroit area. In that town his chief lieutenant is Pete Licavoli,
Detroit ]:)olice department No. 30787. There is his photograph and
criminal record.
Another of his lieutenants is Joe Bommarito, alias "Scar Face,"
Detroit police department No. 37496. Bommarito is the owner of an
apartment at 6795 Abbott Avenue, Miami Beach.
Tlie Chairman, It will be made a part of the record,
( Exhibit No, 111, on file with conmvittee.)
Mr. Sullivan. Also associated with Massei in horsebook and num-
bers o])erations in the Detroit area is Larry ISIcHugh, Detroit police
ORGANIZED CRIME IN INTERSTATE COMMERCE 163
department No. J-21944, Herman Bernstein, Detroit police depart-
ment No. 30946, and Phillip Lieberman, coowner of the Century Bar
;iiid Kestaurant Equipment Co., located at 2144 Bagley xVvenue in
Detroit.
In the year 1947, Tony Accardo, of Chicago, leased the home of
James Passanante at 9199 Collins Avenue in Miami Beach. Passanante
is a coowner with Gerhardt Wobernian and Steve Brancaleone of the
Master Music and Gay Coin Co., located at 4866 Woodward Avenue in
Detroit. These men, w^ith Steve Robetaille, were connected with the
Master Music Co. and racehorse handbooks and numbers operations
in the Detroit area.
Massei is also associated with them in those operations. Others
connected with Massei's operations in Detroit are Louis Eicciardi,
alias "Louis the Wop," Detroit police department No. 8950, Joseph
Burnstein, Detroit police department No. 14498, Samuel Lipkin, Fred
J. Drain, Charles Cobbler, FBI No. 1144812, and Nicholas Tamburello,
FBI No. 9457071.
Accardo's brother, Martin Accardo, Chicago police department No.
C-33656, resides at 1217 Granada Avenue, Coral Gables, which home
he owns. Tony Accardo is also the owner of a yacht called the Glcurijo.
This boat is stored at the Miami Beach boat slips and shows painted
on it Clarijo^ River Forest, 111.
Three years ago arrangement for the rental of this boat slip were
made by Joe Massei, who at that time stated that he was making these
arrangements for his partner from Chicago, 111., Tony Accardo. Sub-
sequently, this boat has been used by Harry Russell, of Chicago, and
by others for fishing parties, and apparently for pleasure purposes.
I believe the testimony W'ill hereafter show a connection between this
boat and Harry Russell's residence and also with the residence of
George Bowers, one of the operators of the Sunny Isles Casino at
Sunny Isles, Fla.
The photograph and criminal record of Louis Ricciardi reflects a
large number of arrests for drug violations, at least four charges of
murder and a number for armed robbery and others. A photograph
of his residence, 9166 Harding Avenue, at Surf side, I also give you.
I believe it might clarify my testimony if I make a statement to
this effect: The fact that the chart shows a definite connection be-
tween certain hotel operations and between certain groups does not
mean that the associations or possible connections of these people
can be dovetailed or tied up and put info a block. My investigations,
for instance, have shown, as reflected by my testimony, that there is a
community of interest between these five groups and an overlapping
of the operations, both in gambling and legitimate businesses, which is
most difficult to trace out.
The mere fact of the geographical origination of a particular man
does not mean that he must be tied up today with the persons located
in the town he came from. We found that particularly true in the
Miami area where we have a combination of people connected in legiti-
mate businesses and who have rackets elsewhere and here, who come
from St. Paul, Minneapolis, Chicago, Detroit, Cleveland, Youngs-
town, Akron. Buffalo, Boston, Providence, R. I., New York, Philadel-
phia, Wasliington, D. C, and practically all of the large towns located
east of the Mississippi River. And those connections show up in,
different operations at different times with different individuals.
164 lORG'ANIZED OKIME' IN ESPTE'R'STAT'E COMMERCE
For instance, Fred Angersola is shown as the operator of the Grand
Hotel, the lessee of the Grand Hotel, but his brother, John Angersola,
is shown as one of the operators of the Wofford Hotel, but the Wofford
Hotel, in turn, is a mixture of Cleveland people and New York City-
people, and the persons who took part in gambling games in the Wof-
ford come from New York, Detroit, Philadelphia, Providence, New
Jersey, Cleveland, and other towns, and that seems to go through all
our investigations ; that although there is a common enterprise, which
might be gambling, nevertheless they have individual interests that
the people might have, regardless of geographical location.
In the case of the gambling in Broward County I think it can be
generally stated that that major gambling has been controlled by a
group of New York racketeers, to the exclusion of other racketeers
from Chicago, Detroit, and what not.
In the Miami area gambling has been controlled in great measure
by local operators until the last year or two. The legitimate business
interests, however, overlap from one to another.
In the Martinique Hotel in Miami Beach, Isadore Blmnenfield, alias
"Kid Cann" — he is not shown on the chart — has been stated from a
number of sources as being a large owner of that property. That
real estate on which the Martinique Hotel is located is owned by a
corporation. The lots south of that hotel are owned by the same cor-
poration. One of the principal officers in that corporation is Ed
Berman of Minneapolis, Minn. Ed Berman is one of three brothers.
Edward Berman, FBI No. 713989, who was sentenced in the United
States district court in Oklahoma, to 5 years in the United States
penitentiary in connection with a Federal charge of conspiracy in
connection with kidnaping. He was sentenced on October 7, 1933.
Dave Berman, FBI 52755, has a criminal record which shows a
number of arrests and at least one case of conviction at the Sing Sing
Prison in November, November 23, 1927.
Charles Erving Berman, FBI No. 111205, is also a brother of Ed
and Dave Berman. Charles Berman goes by the alias of Chick Ber-
man, and he now has gambling concessions in Miami Beach and was a
very frequent visitor to the Club Boheme and the Club Green Acres
in Broward County this past season.
The Martinique Hotel opened up in the year 1946, immediately
after the war, as a new hotel. The gambling concession at that hotel
was taken over by a New Yorker, a man by the name of Julius Cramer,
alias Julius Steel, alias Julius Berman, and is commonly known in
Miami Beach by the name of Beeman, Jules Beeman. His criminal
record goes back to the year 1924 and shows a large number of arrests
on such charges as grand larceny, felonious assault, and drug
violations.
Subsequent to his taking over this gambling concession he was
brought before the Federal court as a material witness in a special
inquiry being made of the narcotics operations in this area. Jules
Beeman has in the last year or so taken over as a partner in the opera-
tions of a gambling syndicate in Miami Beach known as the Little
Syndicate. The Little Syndicate has been control led by two gamblers,
Sammy Clark and Harris Leveson, and in the last year and a half
Jules B?eman has become one of the principal owners in that gambling
operation.
ORGANIZED CRIME IN INTERSTATE COMMERCE 165
The criminal records and photographs of the people I mentioned
and the photographs of the hotel are there.
In searching the real-estate records of Dade County we found that
Isadore Blumenfeld, along with Edward Berman, and Blumenfeld's
brothers, Harry and Yiddy Bloom, were associated with the purchase
of a tremendous amount of property in the Greater Miami area.
Along with them was a man by the name of Abe Brownstein and his
wife, Emma, S. I. Bernbaum, and his wife, Birdie Bernbaum, and
8. W. and Leroy Feldman — all of Minneapolis, Minn.
As the result of a search of the real-estate records we found that
Blumenfeld, Berman, and these others either jointly or individually,
or partially between them, owned the LaBelle Apartments, at 344
Euclid Avenue, Miami Beach, the Hollingsworth Apartment, at 1641
Pennsylvania Avenue, Miami Beach, the Tamiami Hotel j at North-
west Second Avenue and Flagler Street, the Hotel Martinique, two
undeveloped lots on Byron Avenue between Eighty-fourth and
Eighty-fifth Streets, Miami Beach, a hotel located south of the Mar-
tinique Hotel, three ocean-front lots south of that hotel, a parking lot
at 225 West Flagler Street, Miami, Fla., five lots in the Normandy
Golf Course subdivision, two lots in the intersection of Michigan Ave-
nue and Indian Creek Drive, Miami Beach, Fla.
The ownership of the property is not restricted to the ownership of
outsiders. Our investigation disclosed, and investigations previously
made by Melvin Richard, presently city councilman at Miami Beach,
disclosed that the S & G Syndicate members had purchased a tre-
mendous amount of ocean-front property, running from the Firestone
estate, from Forty-third Street, Miami Beach, up to and beyond
Sixty-second Street, Miami Beach, and this is probably the most ex-
pensive real estate in the nonbusiness area, nonbusiness real estate in
the Miami area.
Among the property owners was Harold Salvey, Charles Friedman,
Sam Cohen, Jules Levitt and his sister, Virginia Levitt, Sam Fried-
man, brother of Charles Friedman — all of these of the S & G Syndi-
cate— Samuel T. Haas, a retired criminal lawyer from Cleveland, Ohio,
and Thomas J. McGinty, operator of the Mounds Club at Cleveland,
Ohio.
Our investigation further disclosed the ownership of a tremendous
amount of ocean-front property south of Palm Beach, at Lake Worth,
Fla. We found that the property on which the Palm Beach Ambas-
sador Hotel is located, at Lake Worth, was owned by Samuel T. Haas.
That building was built by the Burnstein Bros., a construction com-
pany of Cleveland, Ohio.
One of the officers in that construction company was Allard F. Roen,
and Roen was the recipient of telephone calls that originated on the
west coast with a large gambling operator who I believe was Mickey
Cohen.
Edward P. Strong, who was formerly owner of several race tracks
in Ohio, and who was a major stockholder in the Detroit race track,
and who is associated with Arthur B. McBride, of Cleveland, in cer-
tain business enterprises, also was disclosed as being the owner of a
large amount of property in the same area in which Sam Haas owned
property at Palm Beach.
On May 23, 1950, two suits were filed in the circuit court in Dade
County, asking for the rezoning of the property located north of the
166 (ORGANIZED ORIIME IN INTE'RSTATE COMMERCE
Firestone estate, of which a number of lots are owned by the S & G
Syndicate. These suits were brought, one by Harold Salvey, a mem-
ber of the S & G Syndicate, and the other suit by Thomas G. McGinty,
and the purpose of the suits was to require that the property be opened
up from residential to hotel and apartment zoning. By so doing the
owners of that property would increase their profits three to four
hundred percent, making it possible for the owners to realize a tre-
mendous profit in case that proj^erty could be rezoned.
The other legitimate interest of the racket element in this area is
reflected in the ownership of the Lyric. It is a wired-music organiza-
tion of which the majority of the stock is controlled by one Bennie
Kaye, who is carried on a previous chart as the operator of gambling
at the Club Collins on Collins Avenue, Miami Beach.
On February 27, 1950, we conducted an investigation to investigate
and check on the activities of two men who were reported to be in-
stalling illegally and improperly telephones in various gambling loca-
tions in the Miami Beach area. As a result of our investigation we
found two men driving in an automobile who pulled up in the rear of
Lincoln Road in Miami Beach. These two men contacted the driver
of a telephone company truck and the truck was opened and the two
occupants of this car, Melvin Zeigler and Lawrence A. Bridis, driving
a 1941 Buick club coupe automobile, proceeded to take telephone
equipment from the truck for a period of 15 or 20 minutes; a tre-
mendous quantity of equipment.
The original information of our inquiry was to the effect that these
men were installing telephones and taking telephones out of the bookie
establishments in Miami Beach. During the course of the surveillance
the investigators saw these men go into various hotels to the loca-
tions of the cabanas with telephone instruments, wires, and various
other types of telephone equipment and return with other telephone
instruments of a different nature, which apparently they had
replaced.
Since that time we have received information and are now investi-
gating an agreement for the purchase of certain sound equipment
which is used for the purpose of taking and transmitting information
by wire illegally or improperly. This consists of a set whereby it
can be tied into either a telephone wire or a power line, and com-
munications can be sent over those lines by carrier current and the
information picked up within an area of 12 to 15 miles.
The CiiAiKMAN. Mr. Sullivan, when you reach a place where you
can pause, I think you had better do so. How much longer do you
think your testimony will take?
Mr. SuLLiVxVN. I don't think any longer than 15 minutes.
The Chairman. I want you to make your full statement but we
would like to notify some witnesses, if they will be needed this after-
noon, or as to whether they will be needed.
A number of witnesses are here under subpena, and all witnesses
who have been subpenaed and are requestecl to appear before the
committee must remain in attendance at the hearings unless specifically
excused. If any of you cannot conveniently be here this afternoon
you might chock with Mr, Robinson or Mr. Halley of the connnittee
staff and see wliether it was the intention to have you this afternoon
or whether you should come back tomorrow; but do not leave unless
you secure permission to do so.
ORGANIZED CRIME, IN INTERSTATE COMMERCE 167
The committee will stand in recess until 2 o'clock, at which time
we will resume our proceedings promptly.
AFTERNOON SESSION
The Chairman. The connnittee will come to order. Mr. Sullivan,
will you come back to the stand?
Mr. Sullivan. Yes, sir.
The Chairman. All right, Mr. Sullivan. Will you proceed with
your testimony?
Mr. Sullivan. I have jnst a couple of items here that I would like
to clear up. I had misplaced a photograph of Sam "Gameboy"
Miller, and the other is Isadore Blumenfield, alias Kid Cann, and also
a photograph of an apartment house owned by Herbert Manheim at
998 Bay Drive, Miami Beach.
The Chairman. They will be attached with their criminal records.
Mr. Sullivan. They are already in evidence.
(Exhibit No. Ill on file ^xith committee.)
Mr. Sullivan. In connection with the ocean-front lots that I have
testified about this morning, those lots were valued a year ago at $800
to $1,000 per front-foot. With the present zoning changes the lots
are approximately 4 percent less at the present price of $3,750 and
$4,000 per front-foot.
I might just conclude by briefly stating that the identities of the
principal gambling operations in Dade County. The gambling in
Miami Beach is more or less limited to horse bookmaking and the major
operations are controlled by the S. & G. Syndicate, of whom the mem-
bers are Jules Levitt, Sam Cohen, Charles Friedman, Harold Salvey,
Eddie Rosenbaum, and Harry V. Russell, the latter being a member
only for about the past 15 months, and he formerly was connected with
the Capone Syndicate as a partner in the operations of gambling of
Charles Gioe and Ralph Pierce at the Silver Bar at 400 South S^ate
Street.
The Miami Syndicate — an old gambling syndicate — has more or less
headquartered their operations at Club 86. This club has not been
open for gambling for the last 2 years. However, some of the
members have their individual horse-bookmaking operations and the
identity of the members of Charles Thomas, Merle Yarbrough, Jack
Friedlander, Cliff Spikes, and Marty Richman.
The Sunny Isles Casino is located at Sunny Isles. It is run by Ike
Miller and three members of the S. & G. Syndicate from Miami Beach,
Charles Friedman, Jules Levitt, and Harold Salvey. This year
George Bowers was also an owner and I think one or more of the
other members in previous years dropped out. The Island Club,
which is also located at Sunny Isles Casino, and is operated by Herbert
Manheim, Sam Cohen, Sam "Gameboy" Miller, of Cleveland, and
Jack Friedlander,
I think that summarizes the general gambling operations — the major
operations.
Mr, Halley, Have you to your satisfaction described the operation
of the S. & G. Syndicate? ^
Mr, Sullivan, I haven't described them. I might be able to briefly
summarize them.
Mr. Halley. Would you do that in summary form ?
68958— 50— pt. 1 12
168 ORGANIZED C'RlIME IN INTERSTATE COMMERCE
Mr. Sullivan. The S. & G. Syndicate is primarily a bookmaking
syndicate. It has several headquarters and individual operators who
come to this area ordinarily negotiate with themselves with the owners
of hotels and arrange for a price for the gambling concession at the
hotels. Then arrangements are made with the syndicate for cutting
up the cost of the concession. The gambling operator pays the hotel
himself personally whether it is $3,000 or $10,000. The syndicate then
places its own value on the worth of the gambling concession.
If the operator has paid $10,000 to the hotelman, the syndicate might
think it is only worth $7,000 and they will only assume one half of
what they consider to be a good price.
In other words, they would assume $3,500, or one-half of $7,000, or
whatever figure it is worth. Then, that money or obligation of the
syndicate is not put up in cash. That money is paid off only out of
profits. The operator then goes into business and arrangements
are made with the syndicate to book bets through the syndicate, and
the wire service is arranged for and the purchase of scratch sheets and
other things.
A telephone ordinarily is run into the cabanas and bets are taken
both in the hotels and on the beach.
Mr. Halley. Who are the members of the S. & G. Syndicate?
Mr. Sullivan. I have just given them a few minutes ago.
Mr. Halley. Did you mention Russell as a member?
Mr. Sullivan. Yes, I did.
Mr. Halley. When did he become a member ?
Mr. Sullivan. In the spring of last year — the spring of 1949.
Mr. Halley. What were the circumstances leading up to Russell's
becoming a member?
Mr. Sullivan. Early in February, at the top of the season — the sea-
son runs from about the 15th of January to about the 5th of March;
or even later than the 15th of January ; around the 1st of February —
shortly after the 1st of February 1949 the wire service was suddenly
shut off in Miami Beach, and then, on subsequent days, it was shut off
in the rest of the south Florida area, in Broward County, Monroe
County, and Dade County. With that service being shut off, it prac-
tically put organized bookmaking out of business. It remained off
for a period of 10 or 12 days and when it was renewed, Harry Russell
was brought in as a partner in the S. & G. Syndicate.
Mr. Halley. He had not appeared as a partner before then ?
Mr. Sullivan. Not at all.
Mr. Halley. Have you described the operation of the syndicate in
Miami to your satisfaction?
Mr. Sullivan. I think so. The major operations, as I say, were
in Club 86. Some of the operators had been connected with the opera-
tions of the Tepee, a night club and gambling place located on South-
west Eighth Street, which is run off and on during the season generally
for a number of years.
The individual members of that syndicate have participated in other
forms of gambling such as Bolita, numbers, as individuals. This syn-
dicate also goes under the name of the ABC Co, as the legal entity.
Mr. Halley. What gambling operations funnel out of Club 86?
Mr. Sullivan. Normal crap, roulette, chuck-a-luck, bird cage; it is
a large gambling place.
ORGANIZED CRIME IN INTERSTATE COMMERCE 169
Mr. Hallet. Can you state where S. & G. gets its service today ?
Mr. SuLLivA>r. No ; I can't.
Mr. Halley. Do yon know whether it does get wire service or
whether it got wire service during the past winter?
Mr. Sullivan. I do.
Mr. Halley. But you do not know where ?
Mr. Sullivan. No ; I don't.
Mr. Halley. I have no further questions.
The Chairman. Senator Hunt ?
Senator Hunt. This morning, Mr. Sullivan, in your testimony you
told us of watching the transfer of a very good deal of telephone
equipment from a telephone truck to a passenger car. Was that trans-
action reported or was anything done about it ? Was it looked into ?
Mr. Sullivan. Yes ; we reported it. The two men who investigated
it reported it to the office of the county solicitor for a determination of
whether there was evidence enough for prosecution on the question of
whether they could identify the material that might be found in the
car of these two men as being telephone company property, and it was
taken under advisement. He considered making some further investi-
gation to either search the car or bring the men in for questioning in
an effort to locate the property, but nothing more was done about it.
Senator Hunt. You don't know whether the telephone company
itself was apprised of this situation?
Mr. Sullivan. Yes ; they were apprised of it. In fact, I talked to
the officials of the telephone company, and it was agreed that the mat-
ter would be taken up with the county solicitor's office.
Senator Hunt. Nothing came of it ?
Mr. Sullivan. Nothing came of it.
Senator Hunt. You are probably acquainted with the situation here
better than any other individual. Would you care to make any kind
of an estimate of the gambling take in this area in any one season ?
Mr. Sullivan. That would be difficult. I would say that the gross
take of the S. & G. Syndicate on Miami Beach alone runs between
$30,000,000 and $40,000,000 a year, and that their net runs somewhere
between $4,000,000 and $8,000,000 per year.
Senator Hunt. And that doesn't include the gambling take?
Mr. Sullivan. And that doesn't include the gambling houses and
other gambling operations.
Senator Hunt. Would you care to make any estimate — just a
guess — as to what you think the total value of the gambling business
runs to here in a season, just to give us an idea ?
Mr. Sullivan. I would say that probably the rest of the gambling
in the county doesn't amount to any more than what the S. & G. makes ;
probably rims somewhere around $10,000,000 — $8,000,000 to $10,-
000,000.
Senator Hunt. Let's not limit it just to one county; to this area —
the Miami area. What would you estimate the take to be ?
Mr. Sullivan. Senator, I really just couldn't do it. I am not fa-
miliar enough with all their gambling operations in Broward County
to come to a conclusion. It runs up to quite a large sum of money.
Senator Hunt. Well, let me just suggest that it may be $25,000,000.
Now, would you care to, or could you give us, any idea of what part of
that $25,000,000 goes out of the State, goes into the cities where the
heads of these gangs are established ?
170 ORGANIZED ORIIME IX INTERSTATE COMMERCE
Mr. Sullivan. Well, I think in Broward Comity a large propor-
tion of it — a fairly large proportion of it — will go north. In Dad'&
county, a great number of the gambling concessionaires are S. & (t.
people located in other States like New York and New Jersey wha
come down here during the season. That money in great measure
will go out of here. At least their 50 percent share will go out.
The 50 percent share that the syndicate takes of course will stay here,
but it would be hard to estimate what proportion of that would leave
the State and what part would stay in.
Senator Hunt. Now, to further develop the line of reasoning I
suggested this morning, do you think gambling is an asset to this
community ?
Mr. Sullivan. No, I don't.
Senator Hunt. Economically?
Mr. Sullivan. No, I don't.
Senator Hunt. Wliat do the people think ?
Mr. Sullivan. I think there is quite a large group of people that
think that gambling is an asset in that it is an inducement to the
tourists.
There is, I think, a rather common and accepted opinion that
gambling is a question of placing a dollar bet and that is all, and
the basis upon which the people make up their minds seems to be
that by doing that, there is no harm in placing a dollar bet, but the
ramifications of when it becomes highly organized and operated by
syndicates doesn't seem to reach the average person.
Senator Hunt. Do these gamblers maintain local bank accounts?
Mr. Sullivan. Yes ; a great number of them do. I have no way of
estimating how many do and what percentage doesn't.
Senator Hunt. Does a crap game bank daily ?
Mr. Sullivan. It depends upon the game. If it is a large game,
the banking in great measure is done through an armored truck
service which acts more or less as the bank. The money is put in
the armored truck and it is kept overnight and it comes back the next
day, so the armored truck actually becomes the bank or the place of
deposit of these funds during the gambling season.
Senator Hunt. Do you think there is any honest record made of
the winnings of these various gambling institutions so that the Gov-
ernment may have a check for income tax purposes ?
Mr. Sullivan. No, I don't. It is too easy to take money off
the top. You can figure an operation where a gambling place could
lose, and they probablv do lose, on an average of $20,000 a night for
5 nights. That would mean $100,000 that they are in tlie hole. But
if tliey were to run a lucky night where they might make $75,000, it
would seem very foolish for a gambling operator who is operating
outside the law to take that $75,000 and declare it all as a profit when
he is already $100,000 in tlie hole. There is nothing to stop him
from putting that $25,000 in his pocket and making an accurate
return on the rest of the money, and to so instruct his accountanrs
to make an accurate check on the money or records that he turns
over to the accountant.
Senator Hunt. Your crime commission, like the Chicago Crime
Commission and the otlier crime commissions in the various cities,
without a question of doubt lias been doing tremendously excellent
work.
.ORGANIZED CRIME IN INTERSTATE COMMERCE 171
Would you care to tell the committee some specific results thtit you
thiuk you have obtained from your work?
Mr/ Sullivan. I think that the specific results that we have had
down here cannot be measured in any suits that were brought, in any
l)etter law enforcement except the law enforcement that has come about
throuofh the pressure of public opinion.
Miami Beach gambling, for instance, last year closed down in June
and remained closed up until the first of this year, practically tight as
a drum for the first time in many, many years. Then it opened up on
a, more or less sneak basis, and as time went on it opened more and
more and it closed down again around March. The gambling houses
closed down.
I believe it was due in great measure to the pressure we put on
these gambling operations around the middle of February of this
year, well before the season was over. That is the top of the season.
We brought an injunction suit against one gambling place after we
obtained information that a mob from Philadelphia was moving in on
it — the Turf Club — and we got an injunction against that place.
The difficulty that we find in attemptin2; to enforce the law is that
it is an expensive proposition ; where the work of prosecution of
the case is not taken care of by somebody that is on a payroll;
where you have to hire attorneys to prosecute the case and you must
hire witnesses to testify; to make investigations and to appear in
court, and the thing is dragged out over a long period of time so that
it handicaps us to the extent that one injunction suit will cost as much
as $800 or $1,000. That is the difficulty of trying to do something
by individual operations.
In great measure we have attempted to arouse public opinion against
the evils of it because we are a new organization on the detrimental
effects that it has on the commnnity not only because of the money be-
ing diverted from legitimate channels but because of the fact that this
Avidespread gambling is an inducement to these racketeers to come
down and invest some of that money in these gambling houses and
gambling operations and that money is very difficult to trace.
We know that the result of it is that the money does go into these
gambling operations and we find ourselves with a tremendously large
criminal population, and we think it is bad on the community b?cause
some of the money passes from the illegitimate channels into the
legitimate trade in the purchase of hotels and different companies and
operations so that after they are here for a while, it is difficult to find
out who owns what or who you are dealing with.
So, in great measure, our operations have been directed to ap])ealing
to the people in arousing an interest on the part of the public to
demand of the public officials that they enforce the law.
Senator Hunt. One more question, Mr. Sullivan. Greater Miami
here has a project that you have been working on for a great many
years — an educational, cultural, and trade center — a sort of continuous
exposition that they are looking forward to and have been working
on, with the possible expenditure in lay-out of grounds and buildings
and some sort such as that of as much as $60,000,000. It is to encom-
pass a trade center and an educational center and a cultural center
for the Western Hemisphere.
Do you think the reputation that Miami is gaining by virtue of
this gangster headquarters in wintertime being perhaps the outstand-
172 ORGANIZED CRIME' EST INTEKSTATE COMMERCE
ing gambling area of the States today will work to the disadvantage
of that greater Miami project that all Miami is looking forward to ?
Mr, Sullivan. I certainly do. I think it has an effect upon the
investment of any money in this area, particularly where it gets to a
point where there is a possibility of the racket element obtaining
political control through bribery and corruption and what not of our
Government, because legitimate businessmen don't like to invest
money, as you know, in any area where their investment is not secured
by established law and order.
Senator Hunt. I think that is all.
The Chairman. You spoke of the Miami Crime Commission em-
ploying attorneys to prosecute cases against these criminals; is that
correct ?
Mr. Sullivan. Injunction suits.
The Chairman. Injunctions. How about the regular prosecuting
attorney here in Dade County ? Do they prosecute the suits against
these people?
Mr. Sullivan. Very rarely; that is, of any gambling operation of
any size.
The Chairman. Have you turned information over to them, and
what happened to the information that you turned over to them, if
you have?
Mr. Sullivan. Senator, the operations of these gambling places
are so well known down here that it is a matter of common knowledge.
It is practically reported in the press that this gambling place is
running wide open and the next gambling place is running wide open.
It is not a question of sneak operations. It is just common knowl-
edge, and the diti'erent gambling places appeal to different classes of
clientele. Some of the larger places have a plush clientele.
The Chairman. I know if you don't live here you can't be here
but 30 minutes and make any inquii*y when the season is on without
being told about all of these places.
What is the local prosecuting attorney doing or what has he done to
close them up ?
Mr. Sullivan. There has been no particular action taken locally.
The Chairman. No particular action. What special action or any
action ?
Mr. Sullivan. No action that I know of to close them down.
The Chairman. How about the sheriff ? What is his responsibility
in that matter ?
Mr. Sullivan. The sheriff has a responsibility.
The Chairman. Is it against the laws of the State of Florida to
have these open gambling places ?
Mr. Sullivan. Yes.
The Chairman. What does he do about it ?
Mr. Sullivan. Nothing particularly.
The Chairman. Why? Don't you give him a lot of information?
Mr. Sullivan. The information, Senator, is already there. Every-
body knows about it.
The Chairman. Have you heard of him closing any of them around
in Miami or Miami Beach ?
Mr. Sullivan. They close them doAvn occasionally when something
happens. For instance, the Governor was down here in February of
this year and he appealed then, after going back to Tallahassee, to all
X)RGANIZED CRIME' IN INTERSTATE COMMERCE 173
of the sheriffs of the State to enforce the gambling laws and every-
thing closed down. There was no difficulty in closing them down.
The Chairman. For how long did they close down '^
Mr. Sullivan. They were closed down for the rest of the season.
That was around the middle of February.
The Chairman. Mr. Sullivan, the committee appreciates the fact
that you have had a great deal of experience in this kind of matter in
many parts of the United States. What Federal legislation do you
recommend? What do you think the Federal Government can or
should do to help local law-enforcement officer or State prosecuting
attorneys with problems like you have here ?
Mr. Sullivan. I think first of all that obviously there should be a
much greater tightening of the enforcement of the internal-revenue
laws and that the settlement of income-tax claims against known rack-
eteers should be made very, very tight. I believe that the present law
that we have on the statute books on income tax, if strictly enforced,
Avould put a lot of these people in the penitentiary.
Secondly, there should be some obvious control over the transmission
of information that does not appear to be censorship.
There should be, I believe, some control over gambling and race-
track-information transmission, and then I believe also that there
should be some thought given to the transportation of funds obtained
by gambling operators locally in interstate commerce and the invest-
ment of those funds in other States. I don't know how it can be done,
but we find ourselves in this area, like it was mentioned this morning
in testimony, that the question is, 'W^hy can't the law be enforced?"
We are confronted here, the average citizen is, with the fact that
there is a tremendous quantity of money that pours in here and goes
into the gambling rackets and when people run for ofhce down here,
today, it means every candidate must be able, in order to compete with
other candidates, to put up tremendous sums of money to have any
chance at all of winning. The only people that seem to be interested
in investing in a candidate's chances for election are the fellows that
are running the rackets. The average legitimate businessman won't
put up a dime. So, the result is that the good will of the people that
run the rackets is sought by candidates as the only means whereby a
man can be assured of election. I think the conditions here may be a
little bit different than in other towns because of the vast sums of
money that inure to the benefit of the racket people engaged in gam-
bling in this area.
The Chairman. In your statement, I know you don't mean to refer
to all of the condidates who are elected, do you ?
Mr. Sullivan. No.
The Chairman. I know that there are a good number of honest
public officials in this section, and you referred to some of them?
Mr. Sullivan. That is right. I don't mean every candidate, but I
mean that the man who is considering whether he should run for office
or not, must always consider whether he will take a chance and try to
run for office without the benefit of the money that the other candi-
dates have, if he refuses to take money from the rackets.
The Chairman. As a result of the work of the crime commission
and the increased interest on the part of some of the officials and the
people, and with a greater appreciation of the tremendous evil over a
Nation-wide basis as to the kind of thing that has been going on here,
174 ORGANIZED CR3ME IN INTERSTATE COMMERCE
do you see any evidence of an awakening of responsibility on the part
of the people doing something about this problem ?
Mr. Sullivan. I think there is a much greater civic consciousness
today than there was a year and a half ago; much greater.
The Chairman. I think one trouble sometimes is that the person
who makes a $2 bet or occasionally engage in some such small activity
may not appreciate the fact that when that is multiplied a million
times, it has a corrupting influence on government all over the country,
and that it becomes a very serious problem and that is what this com-
mittee is interested in.
Mr. Sullivan, we appreciate your fine work.
I believe Senator Hunt has another word.
Senator Hunt. Mr. Sullivan, I wanted to get your reaction to this
situation.
We have noticed in some of the evidence that has been submitted to
us that there are income-tax returns where local gamblers make large,
generous, and many contributions to local charities; to the Red Cross,
to the Boy and Girl Scouts, polio campaigns, the cancer drive. All
of those various organizations seem to accept this blood money as a
contribution. Don't you think that these organizations probably
would be — would it not be better for the community if they wouldn't
allow these gamblers to buy public opinion or buy the editorial page ?
I don't mean that literally as far as the papers are concerned, but just
that expense; wouldn't it be better for the local people to lay off
soliciting these gamblers for those contributions, for naturally when
those gamblers make such contributions, they Iniow what they are
doing. They are buying public opinion. I want your comments on
that.
Mr. Sullivan. Undoubtedly that is true, because the contributions
I'un up into very large sums of money, and, of course, that is a part
of the public relations and more or less can be written off at the top
as a deductible item, but the effect on the community, of course, is that
it leaves with the public that these organizations and the members
of these organizations the feeling, "Well, that is a good group be-
cause they are supporting our worthy enterprise and our endeavors
and our aims," and it certainly has a bad effect. And, of course, along
with that money or income that is derived from gambling that goes to
the charitable enterprise, there is more money that goes into the
investments in the political candidates for office, and that also has
an effect on the community directly.
The Chairman. Of course, the answer is, it would be better to get
rid of them and leave all this money in the hands of the decent people
so that they could give it to charities.
Mr. Sullivan. Yes, sir.
The Chairman. Thank you, Mr. Sullivan. We will be calling on
you some more.
I think Mr. S. M. Perkins has a record to put in the files. Is Mr.
Perkins here?
Come around, Mr. Perkins.
TESTIMONY OF S. M. PERKINS, ACCOUNTANT
The Chairman. Mr. Poi'kins, do you solenmly swear that the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God?
ORGANIZED CRIME IN INTERSTATE COMMERCE 175
]\fr. Perkins. I do.
Tlie Chairman. All right, Mr. Halley.
Mr. Halley. Wliat is your address, Mr. Perkins ?
Mr. Perkins. My home address is 340 Candia, Coral Gables, Fla.
Mr. Halley. "Wliat is j-our business address?
Mr. Perkins. 505 First National Bank Building, Miami, Fla.
Mr. Halley. What is your business?
Mr. Perkins. My business is public bookkeeping and income-tax
work.
Mr. Halley. Were you served with a subpena of this committee to
produce certain records?
Mr. Perkins. I was.
Mr. Halley. Pursuant to that subpena, have you produced certain
records ?
Mr. Perkins. I brought what records I have.
Mr. Halley. W^ould you state what records you have produced and
give them to the committee at this time?
Mr. Perkins. This subpena called for a great lot of stuff with
which I have no connection whatever. The only work I do that
is connected with the S. & G. Syndicate is Charles Friedman's and
his brother Sam.
Mr. Halley. What work do you do for Charles Friedman ?
Mr. Perkins. I keep the niglit-club books and his personal books.
Mr. Halley. What work do you do for Sam Friedman ?
Mr. Perkins. He is Charles' brother and they are partners.
Mr. Halley. You keep the night club and personal books for both
Charles Friedman and Sam Friedman?
Mr. Perkins. Yes ; Charles and Sam.
Mr. Halley. Have you, pursuant to subpena, brought all of the
books and records in your possession relating to Charles Friedman?
Mr. Perkins. I think so.
Mr. Halley. Will you produce them at this time?
Mr. Perkins. The books* are in the back of the room, and tlie can-
celed checks.
For the information of the committee I don't know but two of the
people connected with the S. & G. I have never been in one of their
bookie establishments and I have never been in their offices. I have
been living here in Miami about 22 years, and I think I have done
Charlie's books and Sam's for about 15 years during that time. The
only figures I have are just Charles' and Sam's figures on the night
club.
Mr. Halley. Will you now produce the books and records that you
do have relating to Charles and Sam Friedman and identify them
as you produce them ?
Mr. Perkins. Here is a ledger called "general ledger."
The Chairman. Let that be made an exhibit to your testimon3^
That will be exhibit Xo. 116. (Later returned to witness after analy-
sis by committee. )
Mr. Halley. Is that Charles and Sam together ?
Mr. Perkins. That is Charles and Sam. They trade under the
name of Charlie's Inn. That is a night club.
Mr. Halley. Charlie's Inn ?
Mr. Perkins. A night club ; yes. This is the journal.
176 ORGANIZED ORffME IN INTEKSTATiE COMMERCE
The Chairman. The journal will be made exhibit No. 117. (Later
returned to witness.)
Mr. Perkins. And this is the canceled checks for the last — I think
they go back to January 1936 and I have them here through 1949,
and the 1950's are in my office. I didn't think you were that far down.
The Chairman. Mr. Perkins, it may be we will want to see the
1950 checks.
Mr. Perkins. You can get them in 20 minutes if you want them.
The Chairman. I think it would be well if you would bring them
over and the auditors of the committee will go over them with you.
Mr. Perkins. All right. I hope to be able to do that tomorrow
because I have to do some payroll work this afternoon.
Mr. Halley. Do you have with you copies of income-tax returns
and work sheets ?
Mr. Perkins. The accountants have those files and I didn't bring
them. This bunch of stuff here is from one accountant's office and
these two here are in another, and they have my inco&ie-tax files.
Mr. Halley. Wliich accounts are they? Will you name them?
Mr. Perkins. Joseph A. Post.
Mr. Halley. What is his address ?
Mr. Perkins. Certified public accountant.
The Chairman. Let's get this first. You are entitled to get copies
of the income-tax returns ?
Mr. Perkins. I can get them.
The Chairman. Will you bring them this afternoon ?
Mr. Perkins. Yes. I would like to bring them in the morning. I
don't have time to get back.
Tlie Chairman. That is all right.
Mr, Perkins Two of the books are all at Blumin & Eoberts' office,
420 Lincoln Road, Miami Beach. They seem to be working on the
income-tax part of it in connection with an income-tax settlement
with the Government.
Mr. Halley. After the records in your own possession have been
produced and the records in tlie possession of Joseph A. Post and the
records in the possession of Blumin & Eoberts have been produced,
will the committee then have all of the records of which you know
pertaining to the Friedmans ?
Mr. Perkins. They will.
Mr. Halley. Now, will you deliver to the committee the remaining
records that you have here ?
Mr. Perkins. Here is the journal from January 2, 1946. They have
two bank accounts. One is with the Mercantile National Bank, on
the beach, and the other is the First National Bank, on Miam* Beach.
These are the monthly bank statements and the canceled checks cover-
ing the same period.
The Chairman. They will be identified as exhibit No. 118, the can-
celed checks. (Later returned to witness.)
Mr. Perkins. Here are statements from the banks for the year
1949.
The Chairman. Let them be identified as exhibit No. 119. (Later
returned to witness.)
Mr. Halley. Is that all you have, Mr. Perkins ?
Mr. Perkins. That is all I have.
ORGANIZE I> CRIME IN INTERSTATE COMMERCE 177
The Chairman. Mr. Perkins, you will remain under subpena in the
e\ent the committee wants to question you about any of these records.
Mr. Peekins. All right.
The Chairman. We have no questions to ask of you at this time.
Mr. Perkins. Thank you.
TESTIMONY OF RICHARD ERVIN, ATTORNEY GENERAL, STATE
or FLORIDA, ACCOMPANIED BY MESSRS. GASQUE, TONI, AND
HORTON
Tlie Chairman. Do you solemnly swear that the testimony you will
give this committee will be the whole truth and nothing but the truth,
so help you God ?
]Mr. Ervin. I do.
The Chairman. Mr. Ervin, the committee appreciates your attend-
ance here. Let me say that the chairman of the committee is ac-
quainted with Mr. George Owen who is one of your assistants m
the States' attorney's office, in the office of the attorney general, I
believe.
Mr. Ervin. That is correct.
The Chairman. Who has the good fortune to come from the State
of Tennessee. The chairman has had an opportunity over the course
of 8 or 9 months now of having several conferences with Mr. Owen.
Now, before we proceed, I want to express our appreciation to him
for his help and also for his suggestions, and we want to thank you
for your suggestions and cooperation that you have given us.
Mr. Ervin. Thank you, Senator. George Owen is a very fine lawyer
who served in the Navy during the war in the intelligence division,
and prior to that was a probation officer under Federal Judge Long.
The Chairman. Mr. Ervin, do you have some of your staff whom
you would like to have come up with you ?
Mr. Ervin. I have Mr. Gasque and Mr. Toni. Mr. Horton will be
in a little later. He had a court hearing at 2 : 30 and lie will be here
in a moment.
The Chairman. This is Mr. Gasque here ?
Mr. Ervin. Yes, sir.
The Chairman, liring them around and have them sit with you.
Gentlemen, in case you have something to do or say, under the rules
of our committee, I will ask you to be sworn.
Do you solemnly swear that the testimony you are to give this com-
mittee will be the whole truth and nothing but the truth, so help you
God?
Mr. Gasque. I do.
Mr. Toni. I do.
Mr. HoRTON. r do.
Mr. Halley. Mr. Ervin, as attorney general of the State of Florida,
you are familiar with the race wire service which has been operating
in the State of Florida for the past several years ?
Mr. Ervin. Yes, sir; I am, Mr. Halley.
Mr. Halley. In fact, you testified on previous occasions Avith rela-
tion to it ?
Mr. Ervin. Yes, sir ; at the hearing of the subcommittee, and Sena-
tor Hunt was there at the time.
l78 ORGANIZED CRaME IN INTERSTATE COMMERCE
Mr. Hallet. As you know, the jurisdiction is, in part, the same as
that committee, but this committee has jurisdiction in connection with
organized crime operating through the channels of interstate com-
merce and in testifying here today you may want to broaden your
testimony within the scope of the relevant testimony before this com-
mittee.
Before proceeding, however, would you describe section 550.07 of
the Florida Statutes of 1941 relating to campaign contributions and
will you describe the effect thereof^
Mr. Ervin. This section of the statutes, Mr. Halley, makes it illegal
for any race track to contribute to the campaign of any political party
or any candidate for a State, county, or municipal office. And then it
provides that the racing commission may revoke the license or permit
if it is determined that such contributions have been made.
Mr. Halley. Is the prohibition restricted to race tracks or also to
persons connected with race ti'acks or controlling race tracks or who
are officers or stockholders of race tracks ^
Mr. Ervin. It also includes those.
Mr. Halley. In other words, those persons would be prohibited,
under this statute, from making campaign contributions ; is that right ?
Mr. Ervin. Yes, sir.
Mr. Halley. Is there a penal provision, Mr. Attorney General ^
Mr. Ervin. I am not familiar with it. I don't believe there is. I
think the punishment consists in the revocation of a permit.
Mr. Halley. The permit referring to the permit to operate the race
track ?
Mr. Ervin. Yes.
Mr. Halley. By "race track" do you include horse race tracks ; is
that correct ?
Mr. Ervin. This statute from which that section is taken relates to
horse and dog race tracks.
Mr. Halley. Horse and dog race tracks ?
]\Ir. Ervin. That is right.
Mr. Halley. Now, would you also at this time inform the commit-
tee and interpret for the committee section 365.02 of the law relating
to railroads and other regulated utilities?
Mr. Ervin, Oh, yes. Mr. Halley, that section is the 1949 law that
banned wire service to bookmakers, and I might add that prior to the
enactment of that section of the law, the Florida Railroad and public
utilities commission had no authority to cancel any private wire or
leased wire because it was being used to furnish bookmaking informa-
tion. That was a new innovation in our State enactments and started
(his chain of effort, I think, to shut off the wire service to the book-
makers.
I want to add this, if I may: until the people of Miami and others
who are interested in getting this bookie bill enacted, it wasn't con-
sidered by State officials other than perhaps the Governor, to use his
powers in relation to seeing that the laws were faithfully executed to
enter into the field of local law enforcement.
I have heard the other testimony here. When I was campaigning,
I came down to this community and 1 campaigned aggressively and
I saw numerous people that I see here today. We thouglit it was a
local problem. I have been attorney there for the State roads depart-
ment, assistant attorney general, and we hadn't entered into it, but
(ORGANIZED CRIIME! IN INTERSTATE COMMERCE 179
when this law was put on the books, I was immediately made a defend-
ant in a suit to have it declared unconstitutional. The Supreme Coun
upheld the law.
Mr. Halley. Could you give the dates ?
Mr. Ekvin. Yes. The Supreme Court upheld that law on December
10, 1949. The legislature enacted this law at the regular session in
May of 19-19. The Supreme Court upheld the validity of this law.
AVe discussed the matter with our utilities commission and the
utilities commission pointed out to me that every one of these contracts
for a private wire passed through my office for investigation and that
1 had to make a report on it and it was my duty to advise whether or
not I thought it was legal or illegal.
So, as a sworn duty, I set up an investigative division in my office.
I named Assistant Attorney General Toni here, and I secured a former
investigator for the Governor's office for two or three administrations
in the past, Mr. Gasque.
I sent them out to investigate the wire-service contracts. There was
no trouble, Mr. Halley, in shutting off the service that was furnished
by the Western Union. That it was a notorious contract w^as clear.
There were 140 drops, I believe, in south Florida where the wire serv-
ice was furnished by Western Union. But immediately after the rail-
road commission canceled out the Western Union wire-service contract,
that was all part of the Continental Press Service and the other serv-
ices— Hagerty, Interstate, the News, and the others — we found that
the bookmakers in this area converted to telephone. They began to
use long-distance telephones.
So, in order to make a showing — we felt we had that duty to do —
we sent Mr. Gasque and Mr. Toni and Mr. Horton here, who is assist-
ant attorney general in Miami, stationed here all the time, and Mr.
Owen — they began a drive to try to find out about the telephone serv-
ice and we did find it, and I testified before your Committee on Com-
merce that when they knocked out the telegraph service, we found
that they were using the telephone to call out of the State.
We think that there is no question but that the Continental Press
Service is a national wire service. They use the telephone and they
use any means that is possible to get the information, and we have
started proceedings to knock out those telephones. It is an inescapable
duty.
I think we are doing the best we can and we are cooperating with
the local enforcement officials, with the crime commission and others
to do the job.
I want to commend this committee on what it is doing, too. When
I got into this phase of law enforcement, I didn't realize the ramifica-
tions of it. I didn't realize the moral and economic points involved
in it, but there is no question in my mind, Senator Hunt, but what we
are having a moral reawakening in this community and in the State.
When I ran for office, I didn't realize what the implications were.
I thought that I would sit in Tallahassee and be the State's lawyer
and I would not have anything in particular to do with local law
enforcement.
This law has opened our eyes. We are into it, and I commend this
committee that it is something that we need here.
The majority of the people in Miami, I think, sympathize with
this thing. There are a great many people in the courtroom today
180 ORGANIZED CRIME IN INTE'RSTAT'E COMMERCE
that disagree. They have all kinds of arguments. They say, "Why,
you are just a crusader, a farmer. You have no chance for the enforc-
ing of the law against gambling."
They say, too. that people are going to gamble regardless of what
you may do. They say that it is necessary for the tourist business.
I think they are mistaken.
Conditions have gone on here so long as they have that they don't
realize that there is a moral reawakening in this country, and I think
Senator Kefauver and Senator McFarland and Senator Hunt realize
the implications of it, and even we can't stop crime. We can't stop
traffic violations, but we can make an effort and do the best we can.
The newspapers are doing their part. The crime commission and
many good citizens and the people of Miami, I think the majority of
them, are going to join in this effort. We need the assistance of the
Federal Government.
A lot of people say it is not right for the Federal Government to
encroach on our law enforcement, but the picture is well known about
the tie-ins of this wire network and all the people who are a part of
it. They are encroaching on us, and on the morals of our community,
and we need the help of the Federal Government.
I think that the bill that your committee put out is a good bill, but
I don't think it goes far enough. I wish it were more on the order of
our State law. I wish that we could shut off the rapid results as well
as the information about betting and the odds and I think, too, that
some of these legitimate news disseminators ought to join and help
us in it, and I know that I am going on that and feel that you are not
particularly interested, but the thing is educational, and I think that
our law enforcement officers, as Senator Kefauver said the other
day, many of them are honest and conscientious and they realize that
the State means business and that the Federal Government means
business, and that we will get somewhere, and we commend you for the
effort you are making, and I hope we have a Federal law putting the
crime commission, the FBI and the others into the field so as to sup-
plement the effort that is made here in the State.
Mr. Hallet. Mr. Ervin, in the early part of 1949, was the wire
service discontinued to the Miami Beach area ?
Mr. Ervin. It may have been, but it certainly wasn't by reason of
any action I took or anyone in Tallahassee. I don't know about that.
The wire service — the telegraph wire service — was cut off sometime
in December of 1949.
I have heard testimony here of Mr. Sullivan, and it may have been
cut off because of some disagreement among the people who have car-
ried on those operations, but I don't think the men in my office had
anything to do with it.
Mr. Halley. Didn't it come to your unofficial attention that in the
early part of 1949, without any official action, but purely because of
some dispute among the bookmaking establishments, the wire service
was cut off?
Mr. Ervin. Mr. Halley, I did hear that, but I want to confess to
you that back in the early part of 1949 this business of entering into
local law enforcement on bookies simply didn't — it wasn't something
that we were greatly concerned with, and I didn't pay much attention
to it.
ORGANIZED CRIME IN INTERSTATE COMMERCE 181
Mr. Halley. But since then you have learned that it is a serious
matter of at least State-wide concern?
Mr. Ervin. Yes ; ^Ye feel that it is, and we follow the policy in our
legislature that recognizes it as an evil.
This law was only passed after two scandals. They tried to pass
it in the 1948 legislature. The scandals that developed there were on
bribery attempts, and they probably wouldn't have passed it in the
1949 session except for bribery attempt which was disclosed and
brought to light, and that may have had a great deal to do with its
passage.
Mr. Hallet. I believe you have gone on record as stating that the
bookmaking and gambling is dominated by syndicates with men in it
so big that they can bribe and influence public officials ?
Mr. Ervin. I feel that that is true, Mr. Halley. The profit motive
in this thing is tremendous, and they naturally have, to protect their
investment; and, if they can bribe or buy anybody, they naturally
will do it.
Mr. Halley. Have you any specific evidence that you could bring
to the committee's attention at this time relating to those matters ?
Mr. Ervin. No, sir; I cannot give you an instance of bribery at-
tempts. I do know, though, that other than those two that I tolcl you
about in the legislature — I know it was stated many times in the
newspapers--and I think Senator McFarland stated up there that it
was recognized here in Florida that there was a purchase of official
tolerance and because it was so widespread and so notorious and must
have been — there again, I have no specific evidence on it, but it couldn't
have been permitted without condonation on the part of some public
officials.
Mr. Halley. That is all I have.
The Chairman. Senator Hunt, do you have any questions ?
Senator Hunt. No; I don't believe I have any questions, Mr. Chair-
man, but I should like to compliment the attorney general on his state-
ment with reference to what effect he feels this racket has on morals
and the economic effect it has on the locality.
I would like to make this one observation, Attorney General Ervin :
Over a long period of years, to the best of my knowledge, the man
who runs for oftice on a program of good clean law enforcement, arid
if it is fought on those grounds and those grounds alone, generally
wins.
Mr. Ervin. Senator, I hope so.
Senator Hunt. There are exceptions to every rule.
Mr. Ervin. That is a chance that I am taking, and I may have
guessed wrong on it, but I don't feel that I have any alternative.
In view of the situation, I will state the policy and then what I
hope is an innate feeling about the subject.
Senator Hunt. I don't think you have guessed wrong. I think the
statements that you have made today have been made known through
the State of Florida through the press, and they have enhanced your
position no end, Mr. Attorney General.
The Chairman. Mr. Ervin, let me get this clear now. Prior to
the passage of this Wire Act, the wire services operated in sending
the news out so that any bookie could get it and there was no restraint
on their operation?
Mr. Ervin. Yes.
182 lORG'ANIZED CRIME IN INTERSTATE OOMMERCE
The Chairman. As I understand it, the Wire Act prevents the
intrastate use of wire services ; is that right?
Mr. Ervin. That is true.
The Chairman. After the passage of the act, didn't you have a great
deal of difficuky about the information being sent to some out-of-State
place and then coming back on the Continental Wire Service?
Mr. Ervin. We did. It came back.
The Chairman. Tell us about that.
Mr. Ervin. I would like for Mr. Horton to tell you that, if you
don't mind, Senator.
I will say this, though: We found that Continental Press Service
on tracks out of the State as well as tracks in Florida — the Associated
Press is a subscriber of Continental Press Service, and before the in-
formation would be sent out by Associated Press to its subscribers,
flashed back by Associated Press wires would be the Continental Press
Service, and it would come back in 2 or 3 minutes after races were run
at practically any track in the country.
The Chairman. You mean after a race was run, say, at Hialeah?
Mr. Ervin. Yes.
The Chairman . The news would get through ?
Mr. Ervin. It would come back.
The Chairman. And come back on wire service within 2 or 3 min-
utes after a race would be run?
Mr. Ervin. That is right.
The Chairman. Do you feel that that was beyond your jurisdiction
because it was an interstate transaction and there was nothing you
could do about it?
Mr. Ervin. I felt there was nothing we could do about it, Senator,
and there is no way to approach it unless we get Federal legislation.
Assuming that we do get the cooperation of the legitimate news serv-
ices and they cut it off and delay it a few minutes, anyone can call
Valdosta, Ga. ; or call New Orleans, La., and get the race results from
any subscriber that may be on Associated Press' or Continental Press'
line or anyone.
This system of getting information is so widespread that all you
need is a long-distance line to pick it up.
We made a raid in Jacksonville only a few clays ago and we found
that they were calling Minneapolis, Minn. ; Valdosta, Ga. ; Augusta,
Ga. ; and Bristol, Tenn.
The Chairman. For your information, that Bristol is on the State
line between Tennessee and Virginia. The telephone company may
be in Tennessee, but I am sure the information came from across the
line in the other State. [Laughter.]
You have examined the police power to cope with these transac-
tions and you have determined after an exhaustive examination that
you have no riglit to interfere with interstate communications ?
Mr. Ervin. That is right.
The Chairman. By State statute?
Mr. Ervin. That is right.
The Chairman. Mr. Ervin, you spoke of the 1947 legislature and
the public scandal of trying to bribe a member of t}\e legislature to
use influence to prevent the passage of this Wire Service Act?
Mr. Ervin. Yes.
ORGANIZED CRIIME IN INTERSTATE COMMERCE 183
The CiiAiRMAX. And it was defeated in that legislature?
Mr. Ervin. Yes.
The Chairman. Who was it that was trying to stop the passage of
the legislation?
Mr. E'rvix. Senator, I don't know who the parties were that sup-
plied the money, but I do know that two members of the House of
Kepresentatives have publicly stated that another member of the
House of Representatives olfered them a bribe to vote against the bill.
The Chairman, Was it a very large sum of money, too?
Mr. Ervin. No, sir; it was not. I think it was only $500. At the
1'.>4U legislature, it was supposed to have gone up to $2,000.
Tlie Chairman. Who brought the injunction suit against the State
for testing the constitutionality of this law ?
Mr. Ervin. That was brought by Walter M. Hagerty, John Mc-
Henry, a corporation by the name of Interstate News Service, and H.
E Bilson Radio Program Service.
The Chairman. What sort of cooperation have you gotten out of
the telephone company in Florida in your efforts to prevent tele-
phones from being in places where the users can telephone information
out immediately ?
]Mr. Ervin. We are getting better cooperation the farther we go
along.
The Chairman. What do you mean by you "are getting better co-
operation"?
Mr. Ervin. They would want to give us no information about tele-
])hones nor would they let us go in and check with them on phones
that were listed as possible phones of bookmakers.
After we got further along with it and they saw that we meant
business, they began to allow us to check their toll records and to give
us information when we found a phone and gave them a number
for it. ^
They said they didn't want to get into the police end of it. They
didn't want to assume that responsibility.
We are doing much better, and I would not want to be critical of
them in view of the fact that they have helped us in the last few
months.
The Chairman. Can you or some of your deputies or assistants
tell about telephones in very strange places that appeared around
race tracks here in Florida?
Mr. Ervin. Mr, Toni, can you tell us ?
^Ir. ToNi. The most typical installation that has been depended upon
in the past and up until this season was known as Sunshine Park in
a shack right across from the race track, where they had a turret
ari'angement on top of the shack and a view of the turf board where
you could read the turf board with a pair of binoculars.
They had telephone connections there. We found two men there
who admitted or stated that they were employees of the Continental
Press Service. We found
The Chairman. Will j^ou furnish their names for the record — their
names and addresses?
Mr. ToNi. Alfred Olsen
The Chairman. Give us what you have now, whatever you have
now, and you can give us the rest later.
68958 — 50— pt. 1 13
184 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. ToNi. That particular location was on the Continental wire
circuit before the Western Union wire was canceled out. We found
the fuse box in there. Then there were — we found similar installations
around Tropical, Hialeah, and Gulf Stream, where there were drops
on the old Continental race-wire line.
The Chairman. Did j^ou find those people worked for Conti-
nental also?
Mr. ToNi. No; we were unable to catch them, but they were oper-
ating at those places. They had abandoned the known«look-out places
and had set up telephone connections in other locations.
The Chairman. Are there any other })laces — aspects, rather, of
this matter — that }■ on can tell us about, Mi-. Toni ?
Mr. Toni. I think Mr. Horton can describe the leased-wire circuits
from Baltimore which ran into the State to Key West and the circuits
which went out of the State on which the Florida race-track infor-
mation was relayed better than I can.
The Chairman. Thank you very much, ]Slr. Toni. Xow. ^Ir.
Horton, will you tell us about your kno>v ledge of the matter ?
Mr. Horton. Senator, I don't know whether you are interested in
all this, but it is a phase I think you might be interested in.
Up until the set-up until December 1049 there was a circuit oper-
ated by the Western Union Telegraph Co. Xow. to briefly state this,
the Radio Program Service of 621 Munsey Building, Baltimore. Md.,
had a connection with the Intrastate News Service, which had its ori-
gin in Florida, in Jacksonville. The Radio Program Service was
operated under the management of one H. E. Bilson. I am speaking
now with copies of the contracts filed with the public-utilities com-
mission before me, which H. E. Bilson signed as an officer of the Radio
Progi'am Service. That tied the link of Radio Program Service out
of Baltimore to Florida.
The Intrastate News Service of which we have contracts here also
applied to the Western Union Telegraph Co. and was furnished leased-
wire service extending from Jacksonville into Key West.
Now, when those circuits went out, why, the only other alternative,
I presume, was for the people who wanted that type of information to
obtain it by telephone. In the course of our investigation, after the
wire services went out, we found that some of these known drops on
the circuit of the Intrastate News which was also on Radio Program
Service in Baltimore were then calling the number of Radio Progi-am
Service in Baltimore, the same identical group.
It is a matter of public record in the Federal Reporter system the
disclosure made by McBride in the case involving the Western Union
Telegraph Co. in California. It is a circuit court of appeals decision
in the ninth circuit decided in 1949 in which McBride made the admis-
sion he was a furnisher of information to the group in the Munsey
Building in Baltimore, Md. That is the place where the southern
bookmaker operators obtain their information on races.
There is a tie-up shown in these contracts at the time of the wire
service with an address in New Orleans. Now, that address in New
Orleans has been supplemented since the wire service is out with tele-
{)hone service and these points of interest in Florida now call either
New Orleans or they call Baltimore or they call Chicago directly. And,
we found in the course of our investigation that direct calls are made
to Continental Press Service in Chicatro.
ORGANIZED CRIME IN INTERSTATE CORIMERCE 185
That is all I liaA'e that I Ijelicve would be of direct interest to the
committee.
The Chairman. Mr. Horton, do you have copies of the various con-
tracts and documents that can be turned over to the committee?
Mr. HoRTON. These are the only copies that I have. I will be glad
to have some copies made and furnish them to the committee.
The Chairman. If you will, I will appreciate it. Do you then as a
specialist in this type of thing join in the Attorney General's recom-
mendation that some method is needed to supplement the State laws
by the Federal control of communications if you are going to keep this
information from being used for gambling purposes?
jNfi'. HoRTON. Senator, I am convinced that the Federal Government
will have to in some way supplement the State authority beyond its
borders because we have no authority over calls that originate in the
State going outside of the State or calls that originate in other
States coming in here and we feel that the Federal Government is the
only resort we have to stop that practice.
The Chairman. Any questions, Senator Hunt?
Senator Hunt. No.
The Chairman. Mr. Halley ?
Mr. Hailey. Xone of this witness, but with the permission of the
committee I would like to ask a few questions of Mr. Gasque.
Tlie Chairman. All right.
iNIr. Halley. Mr. Gasque, were you in the court while Dan Sullivan
testified?
Mr. Gasque. Yes, sir.
Mr. Halley. You may recall that one of the persons about wdioni
he testified was Samuel Bratt
Mr. Gasque. Yes, sir.
Mr. Halley. Who was active in the operation of the Colonial Iniii
and Green Acres.
Mr. Gasque. Yes, sir.
^Ir. Halley. Do you know :Mr. Bratt ?
Mr. Gasque. Yes, sir.
Mr. Halley. Have you had aii}^ dealings with him ?
Mr. Gasque. No, sir.
Mr. Halley. "Would you describe the nature of your knowledge of
and acquaintance with Mr. Bratt?
Mr, Gasque. I will be glad to. Back 7 or 8 years ago Mr. Bratt's
attorney, who is Senator John E, Mathews, from Jacksonville, who
is my senator from my home-town county, introduced me to jNIr. Bratt
in the halls of the legislature in Tallahassee. Since that time I have
in the course of my work through south Florida as an investigator
for the Governor's office, and recently for the attorney general's office,
come in contact with Mr. Bratt, I have gone to Mr, Bratt at times
down here knowing that he had to do with the wire service and got
information from him on people that I was checking on. He would
very graciously give me that and I think on several occasions he has
called me long distance from his home to mine in Jacksonville and on
some occasions he would deliver a message like this: He was unable
to contact Mr, Mathews and he would like for me to contact him anil
let him know that he would be in Jacksonville the next day on such and
such a plane and would like to see him in his office and that he was un-
able to set him.
186 ORGANIZED CHIME IX IXTE'RSTATE OOMIVjERC'E
I had the misfortune, Mr. Halley. in 1947 to have a cancer of this
eye and I had spent several months in the hospital, in hospitals. Mr.
Bratt, I presume, knowing the position I held with the Government,
thought it would be a nice thing to call and make inquiry as to how I
was. Of course, I was in the hospital and wasn't at home, but he would
call and inquire from Mrs. Gasque.
So far as business connections in any way are concerned I know him
no more than I know Costello, Ericson, the Capone boy, the McBride
boy, and all these other characters whose names have l)een mentioned,
and also Mr. Cohen. I know Costello when I see him. I know Ericson
when I see him. I have spoken to him in Miami, in some places in
Miami in the last 16 years that I have been traveling the State.
I would like to say this much, that I went to work in Tallahassee
under Governor Scholtz. I worked under his administration and then
followed 4 years inider Governor Cone and 4 years under Holland, now
United States Senator, and 4 years under the former Governor pre-
ceding. In those years I have come in contact with lots and lots of
criminals in my work and I always have felt that whatever little suc-
cess I might have had in my work is due because I haven't tried to
be hard-boiled or be too high-hatted to speak to anybody regardless
of how low he might be.
As far as any connections in business with him are concerned I
never had any. We knew he had no interest in bookmaking as far as
the bookie business is concerned. As far as we knew he would deal with
Mr. Toni and myself and on different occasions we would go to him and
ask him for certain information this last winter. He would find it
out for us and if we happened to be gone he would call to Jacksonville
and Tallahassee to locate us and give us whatever information we
wanted.
That is the entire nature of my connection with Mr. Bratt.
Mr. Halley. Sir, in the early part of 1950 did you have occasion
to make an official investigation, to make official investigations in the
Miami area?
Mr. Gasque. Yes, sir.
Mr, Halley. You were staying at the El Comodoro Hotel ?
Mr, Gasque. Yes, sir.
Mr. Halley. Did you have a number of telephone calls from Mr.
Bratt during that period ?
Mr. Gasque. I wouldn't say a number. I wouldn't know how many.
He called several times to Mr. Toni and myself. He tried to get hold
of one.
Mr. Halley. Well, did Mr. Bratt call as often as four times in a
single day at the El Comodoro ?
Mr. Gasque. I don't recall if he did, Mr. Halley.
Mr. Halley. If he did would you be surprised ?
Mr. Gasque. No, sir ; I would not.
Mr. Haixey. Could you recall at this time the subject matter of
the calls from Mr. Bratt?
Mr. Gasque. He was giving us information on what we had asked
him to check on for us.
Mr. Halley. What information was he giving?
Mr. Gasque. About bookmaking over there in Broward County
where we cleaned the county up.
ORGANIZED CRJME: IN INTERSTATE COMMERCE 187
^Ir. Hali>ey. Did you make memoiuiida about that information
and put it in your official files?
Mr. Gasque. No, sir. I just made notes of it and put it in my
pocket.
Mr. Hallet. You never filed reports about it with your office?
Mr. Gasque. No, sir; not where we got the information from Mr.
Bratt.
Mr. Halley. I have no further questions at this time, Mr. Chairman.
The Chairman. All right, sir. Mr. Ervin, there was one other
question I wanted to ask you. Where does the responsibility for the
jn-osecution of criminal violations under the State law rest here in
Dade County and Broward County?
Mr. Ervin. Senator, there has been a Supreme Court decision on
that on a case brought by my predecessor, Mr. Watson. I will give
you the citation. In that case the Court said there is a line of demarca-
tion between the duties of the attorney general and the State attorneys.
The State attorneys and the county solicitors they have the discre-
1 ion to determine whether to prosecute or not prosecute for a local law
\ iolation. They are elected officials and they determine from the
facts whether or not they should prosecute.
Our office assists them and we have criminal appeals. If they call
on us to brief a question we do it, but we have no control over their
discretion of their right to prosecute or not to prosecute.
The Chairman. You mean, if the law is bein^ flagrantly violated
on its face, or, if the laws are being flagrantly violated on their face
Aou have no discretion about the matter in doing anything about it?
]Mr. Ervin. Senator, I cannot control their discretion as to whether
or not they shall prosecute. Wherever we have a complaint regarding
a local law violation we transmit that to the State attorney or the
county solicitor and ask them to investigate it and determine whether
or not prosecution is warranted.
The Chairman. Have you done that ■
]Mr. Ervin. We have done that.
The Chairman. In Broward and Dade Counties?
]Mr. Ervin. You mean, with regard to this crime situation ?
The Chairman. Yes ; that is right.
Mr. Ervin. Senator, I don't recall having had a request of that
kind that we transmitted to those officials either in Broward County
or Dade County. We consulted with them about prosecution of these
cases.
You see, where we made a raid and find someone
The Chairman. Of course, Mr. Ervin, all you need to do is read
the newspapers to know what is going on here.
Mr. Ervin. That is true.
The Chairman. Well, whose responsibility is it to prosecute locally ?
Mr. Ervin. It is the responsibility of the local prosecution office.
The CiiAiRMAN. Do you know why it hasn't been done ?
Mr. ER^^N. I think that it probably goes back to the customs of the
people here. There has been in this area a so-called liberal policy.
They didn't want to crack down on certain types of gambling. I sup-
pose much of it grew out of that. Senator.
Mr. HoRTON. Senator, may I just make an observation on behalf
of Attorney General Ervin, that we have signed affidavits as to the
basis of the complaints in Dade County and in Broward County in
188 ORGANIZED ORUME IN INTERSTATE COMMERCE
connection with our investigation of bookmaking operations and some
of these cases, as far as I know, are under prosecution now.
I don't know the results of any particular case that I can tell you
now, but we have affidavits of violations in these two counties that have
been brought to the attention of the local law-enforcement officers and
the results, and complaints have been filed against those people.
I don't think Mr. Ervin knows of that specifically.
The Chairman. What complaints have been filed ? Do vou know,
Mr. Horton?
Mr. HoRTON. Well, in particular, there was a search warrant and a
warrant for arrest issued against a bookmaking operation at the
Saxony Hotel in Miami Beach. That was based on information
which we had obtained through other local law enforcement officers
who cooperated with us and the sheriff's office of Dade County served
fi warrant and as a basis of that complaint arrests were made, charges
were made against the individuals who were found in that bookmaking
establishment.
The Chairman. How about the owners of some of these bookmaking
establishments, the big boys, the S. & G. Syndicate and the Ericsons,
all those fellows that you have seen on the charts here ?
Mr. HoRTON. Senator, they are conspicuous by their absence usually
in places that you have a warrant for search and arrest, and naturally
so because they have their lieutenants or employees operating it and
it is very difficult to find them.
The Chairman. Do you have a conspiracy law in the State of
Florida, conspiracy to violate a criminal law ?
Mr. Horton. Yes, sir; we do.
The Chairman. If they put finances into the operation, keep the
books, put up the money for it, wouldn't that be a part of the con-
spiracy to violate the law ?
Mr. HoRTON. It would be if you could get positive evidence that
actually happens. Senator.
The Chairman. Well, you have books and records.
Mr. Horton. That is true, but as Attorney General Ervin pointed
out the attorney general would feel we were exceeding the authority
of the local law enforcement officers unless requested by the local
officers.
The Chairman. It is not particularly our problem, but we got a
whole truckload of books and records back here. We had no trouble
getting them.
Mr. Ervin. Senator, you want to know
The Chairman, I want to loiow why somebody hasn't done it.
Mr. Ervin. In the first place, I don't have the authority to prosecute.
I can't come here and take over the prosecution of cases. Probably I
might have a duty to recommend and get into it. Where we found
these violations we brought everything in that we obtained in the
raids, all the information we got has gone to the local law-enforcement
officers for prosecution.
They cooperated to the extent of helping us on these cases where
we got the information. The local officers, that is, the prosecuting
officials then take this position: until the case is worked up by the
sheriff they have no duty to do anything but prosecute once an affidavit
or a warrant has been sworn out.
ORGANIZED CRIIME IN INTERSTATE COMMERCE 189
The Chairman. It wasn't my purpose to try to lecture anybody
altout their duty. It was just a matter of our inquiry.
Mr. Gasque. Senator, may I say a word?
The Chairman. Yes, sir.
Mr. Gasque. The main trouble we have is, for instance, we arrested
a notorious bookmaker operating a gambling house. He had in this
gambling place not only a bookmaking establishment but a roulette
and other such equipment. That was the Valhalla Club in Holly-
wood. We went to trial in Fort Lauderdale, the county seat. This
man's lawyer goes in and without informing the attorney general's
office — we were represented by Mr. George Owen. Mr. Toni and my-
self we were sitting out in the hall under the rule to be called in as
a witness — he gets up and pleads nolle contendre. The judge imme-
diately fines him $500 without ever hearing the State's side or the
State's evidence.
In a lot of cases that we got — we got some in Jacksonville this week.
Mr. Toni and I raided a big joint there where we got the warrant
from the justice of the peace. We stayed right with the constable
to serve the warrant for fear they would be tipped off before we got
there. When we got there we got these three notorious bookmakers
whom I have known for 30 years in Jacksonville. The justice of the
peace made bond of $100 and it is a felony.
So, I immediately went to the justice's office the next morning and
explained to this justice of the peace who happens to be a lady the
seriousness of the bookie bill, that it is a felony to operate a book-
making joint and she agreed to raise the bond to $500 apiece which
is $1,500 for the three men. Of course, naturally that doesn't help us
any because that is just a drop in the bucket to them. They don't
mind a $500 bond.
The biggest trouble that we have is when we get one and they don't
realize that the law says it is a felony to operate a bookmaking joint.
They fine them $100 or give them a suspended sentence or something
like that and they get away.
The Chairman. Mr. Gasque, these people skip their bond?
Mr. Gasque. In many cases they do. I know a case in Fort Laud-
erdale that never came up for trial. We never heard anything about
it. I inquired and was told the man forfeited the bond and the bond
was $100. That is the cooperation we get trying to do a good job.
The Chairman. Mr. Ervin, thank you very much and thank you
Mr. Toni.
Mr. Toni. Senator, those two names were Alfred M. Olsen
The Chairman. And his address ?
Mr. Toni. Miami, and L. Oppenheim, Miami. Flagler Hotel is
the address.
The Chairman. And you established that they were employed by
the Continental Press Service of Chicago ?
Mr. Toni. That was their statement.
The Chairman. Do you have their signed statements ?
Mr. Toni. No, sir.
The Chairman. Mr, Ervin, we will be very glad if you will sit with
the committee here and join us. Thank you very much.
Mr. Ervin. I will come back, Senator.
The Chairman, Mr. R. W. Howden, please.
190 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Howden, do you solemnly swear that the testimony you will
give the committee will be the truth, the whole truth and nothing
but the truth, so help you God ?
Mr. HowDEN. I do.
The Chairman. The committee will stand in recess for 5 minutes.
(A short recess was taken.)
The Chaieman. Mr. Howden, will you stand aside just a minute?
Mr. Ervin, will you come back, please ?
Mr. Ervin, we forgot to ask you what is the law of Florida with
reference to the amount allowable for campaign expenditures for
candidates for various offices, that is. State offices.
Mr. Ervin. Senator, the law has been repealed that set a ceiling on
the amounts that could be expended by candidates. This repeal was
effected by the 1949 legislative session. However, there
The Chairman. So, as of now there is no limit?
Mr. Ervin. There is no limit on the amount of expenditures.
The Chairman. But the present law requires a full listing of all
contributions?
Mr. Ervin. A full listing of all contributions.
The Chairman. What was the law prior to the Legislative Act of
1949 ? First, the law of 1949 is not retroactive ?
Mr. Ervin. It is not retroactive. Those of us who ran in 1948 we
are still under that.
The Chairman. Does the law that you were under apply to primary
campaigns as well as general elections ?
Mr. Ervin. Both.
The Chairman. What is the law with reference to primary cam-
paigns ? I mean, what was it in 1948 ?
Mr. Ervin. You mean, the amount of the limit ?
The Chairman. Yes.
Mr. Ervin. The exact amount of that I will get Mr. Horton to look
up for me. I think it was $5,000 for certain offices. I believe cabinet
officials. As to the Governor lam not sure whether it was $10,000
or $12,000, but I will get that for you during the course of the after-
noon.
The Chairman. Did this also recjuire a listing of contributions?
Mr. Ervin. Yes.
The Chairman. Where would they be listed ?
Mr. Ervin. They would be listed in the return by the candidate
filed in the secretary of state office in Tallahassee.
The Chairman. How come the old law was repealed ? That is re-
pealed by the 1949 legislature. In other words, who was the moving
spirit behind it?
Mr. Ervin. As I remember it, it was a bill that w^as sponsored by
the house committee, I think, on elections and the reason offered for
the repeal was that everyone ignored the limitation on expenditures
anyway, they were making liars out of everybody and it was hypo-
critical and tliey might as well get rid of it.
The Chairman. Who was the sponsor of the bill in the house and
in tlie senate?
Mr. Ervin. Senator, I can get that for you in the course of the
afternoon. I will have to make a call to get that. I hate to guess.
Tlie Chairman. If you will get it and furnish it to the committee
I will appreciate it.
ORGANIZED CRIME IN INTERSTATE COMMERCE 191
Mr. Ervin, was there any fight made in the legishiture against the
repeal of this hiw^
Mr. Ervin. I don't think so. As I recall it, there was a unanimous
^ote for the bill.
The Chairman. Do you know wdiether it was recommended by the
Governor?
Mr. Ervin. I don't believe it was.
The Chairman. You don't know^ one way or the other ?
Mr. Ervin. No, sir; I do not.
The Chairman. Did tlie bill originate in the house or in the senate?
Mr. Ervin. I think it originated in the house. I can be mistaken
about that, Senator, but I can get that for you by consulting the Jour-
nal recoi'ds.
The Chairman. Who is the State oflicer in charge of the State elec-
tion records of contributions?
Mr. Ervin. Hon. R. A. Gray, secretary of state.
The Chairman. Is he an elected official ?
Mr. Ervin. Yes, sir.
The Chairman. Any questions. Senator Hunt?
Senator Hunt. How long has he been secretary of state?
Mr. Ervin. He is going into his twentieth year.
TESTIMONY OF R. W. HOWDEN, INVESTIGATOR TOR EQUITABLE
LIFE ASSURANCE SOCIETY
The Chairman. Thank you, Mr. Ervin. All right, Mr. How^den,
will you come up ?
Mr. Halley. I remind you that you have been sworn, Mr. Howclen.
What is your address, Mr. Howden ?
Mr. Ho^vDEN. 1428 Northwest Thirty-second Street.
Mr. Halley. And, where are you now employed ?
Mr. Howden. I am employed as an investigator with the Equitable
Life Assurance Society.
Mr. Halley. How long have you been employed there?
Mr. Howden. One year on the 16th of June.
Mr. Halley. Where were you employed between 1945 and 1949 ?
Mr. Howden. Dade County sheriff's office.
Mr. Halley. Under what circumstances did you leave the Dade
County sheriff's office ?
Mr. Howden. I was dissatisfied with the circumstances there and
had a chance of a better position.
Mr. Halley. Was that better position the one with the Equitable
Life Assurance Society?
Mr. HowT)EN. Yes, sir.
Mr. Halley. What positions did you hold on the staff of the Dade
County sheriff's office ?
Mr. Howden. I was in charge of the identification bureau from 1945
to 1947 and then I was assistant homicide investigator.
Mr. Halley. In 1949 were you considering an offer of a job of chief
of police some place?
Mr. Howden. Yes, sir.
Mr. Halley. Where was that place ?
Mr. Howden. At Opa Locka, Fla.
Mr. Halley, In what county is that ?
192 ORGANIZED CRIME IN INTERSTATE CSO'MMERCE
Mr, HowDEN. That is in Dade County.
Mr. Halley. Before going into that matter any further would you
state who was the sheriff under whom you served ?
Mr. HowDEN. Sheriff Jimmy Sullivan.
Mr. Halley. Was there a man in the sheriff's office named Tom
Burk?
Mr. HowDEN. Yes, sir.
Mr. Halley. What position did Tom Burk hold ?
Mr. Howden. He was a deputy.
Mr. Halley. Deputy sheriff?
Mr. Howden. Yes, sir.
Mr. Halley. Was he in charge of any particular type of work ?
Mr. HowDEX. His particular work was on the raiding scj[uad or
gambling squad.
Mr. Halley. In 1949 when you were considering taking the job of
chief of police on the Opa Locka force at Opa Locka did you have a
conversation about that matter with Mr. Burk ?
Mr. HowDEN. Yes, sir; I did.
Mr. Halley. Would you state the conversation as fully as you can
recall ?
Mr, HowDEX. One morning — I was supposed to take the position
on the 15th of June and I had submitted my resignation — It was
about 2 weeks prior to my leaving that it had been submitted to th©
office — Mr. Burk called me aside and told me that if I was going to
take a job out at Opa Locka he told me a man to see and if I saw this
man he would take care of any situation that might come up there as
far as the gambling situation or any pa^^offs might be concerned.
Mr. Halley. Can you be more specific? Did he tell you that this
man was to see to it that you got a cut of the gambling at Opa Locka ?
Mr. HowDEN, Yes, sir ; he did,
Mr. Halley. Was there any further conversation with Mr. Burk at
that time ?
Mr. HowDEN. At that time he told me that was the man I should
see and I just left it there. I didn't care anything about it.
Mr. Halley. Who was the man who was mentioned to you?
Mr. HowDEN. I was supposed to see a Mr. Red Rainwater.
Mr. Halley, Can you identify Mr. Rainwater ?
Mr. Howden. I don't know him personally. I wouldn't know him
if I would see him.
Mr. Halley. Did you sometime thereafter have a conversation with
a man named George Proskoff?
Mr. HowDEN. Yes, sir.
The Chairman. Who is George Proskoff?
Mr. Halley. The chairman would like to know who is George
Proskoff.
Mr. HowDEN. He is a deputy constable.
Mr. Halley. Where?
Mr. HowDEN. In the first district, Dade County.
Mr. Halley. Would you state the conversation that you had with
Mr. Proskoff?
Mr. HowDEN. I received a telephone call— I think it was the same
day that I talked to Mr. Burk. It Avas that evening — at home and
Mr. Proskoff told me that he had $200 for me to take a vacation before
ORGANIZED CHIME IN INTERSTATE COMMERCIE 193
I went to Opa Locka. I asked liim what it was for and he said that
Ked Rainwater had sent it for me.
I told him I wasn't interested in anything: that he had and if I
did take the position as chief of police at Opa Locka they would know
that I was the chief.
Mr. Hallet. Did you ever take the position of chief of police at
Opa Locka ?
Mr. How^DEN. No, sir. Before the time for me to go out there came
up I took this position that I now have.
Mr. Halley. Did you have any further conversations concerning
the position of chief of police at Opa Locka with Burk or Proskoff
or Rainwater ?
Mr. Howden. None after that. I had no conversations with Rain-
water whatsoever.
Mr. Halley. When did yon last talk to this Tom Burk?
Mr. HoAVDEN. About 2 or 3 weeks ago, about 2 weeks ago.
Mr. Halley. Where did you see him ?
Mr. Howden. Down near the courthouse.
Mr. Halley. On the street ?
Mr. Howden. Yes, sir.
Mr. Halley. And, did you have a conversation wdth him ?
Mr. How^den. I had a sort conversation with him at that time.
Mr. Halley. Would you state that conversation tjo the committee?
Mr. Howden. I met Mr. Burk on the street. I hadn't seen him for
some months. I asked him how he was getting along and I asked him
what he thought about the situation developing in the courthouse.
We had a few words and he told me that he wasn't mad at the boss,
meaning Sheriff Sullivan, and that his main complaint was that the
sheriff's wife had accused him of going around with large sums of
money in his pockets on the streets and he said that they didn't have
anything on him, that he had turned over to her amounts of $7,000,
$8,000, $10,000, and $11,000 at a time; that he had signed receipts
for that money.
Mr. Halley. Was he talking about money in cash ?
Mr. Howden. Yes, sir.
Mr. Halley. And, did he state that he had receipts signed by Mrs.
Sullivan, Mrs. Jimmy Sullivan ?
Mr. Howden. Yes, sir.
Mr. Halley. Was there any further conversation at that time ?
Mr. Howden. No. We just passed the time of day and I left.
Mr. Halley. Did you at any other time have conversations with
Mr. Tom Burk about pay-off money ?
Mr. Howden. One afternoon leaving the courthouse I believe Mr.
Burk was quite upset. The sheriff', as I understand it, had called him
in and reprimanded him about a new automobile that he had bought
and in getting on the elevator I made a remark that he better be careful
or the crime commission would get after him and he said that he didn't
give a damn about the crime commission, that he made his and that he
had taken care of the man with the whiskers and the rest of them
could all go to the devil.
Mr. Halley. Did he ever in so many words admit that he was "in
on the take" ?
Mr. Howden. In so many words ; yes.
194 ORGANIZED CHIME IN EVTERSTATE COMMERCE
Mr. Halley. And it was understood between you that being "in
on the take" meant receiving bribe money from gamblers, is that cor-
rect?
Mr. HowDEN. I think that was pretty general knowledge around
the courthouse.
Mr. Halley. Is there anything else on the subject of bribe money
or about the sheriff's office which you want to tell to the committee?
Mr. HowDEN. No, sir.
Mr. Halley. You were brought here pursuant to a subpena, is that
correct ?
Mr. HowDEN. Yes. sir.
Mr. Halley. You did not volunteer to testify ?
Mr. HowDEN. No, sir.
Mr. Halley. You have been offered no inducement of any kind
whatsoever to testify, have you ?
Mr. HowDEN. No, sir.
Mr. Halley. I have no further questions, Mr. Chairman.
The Chairman. Mr. Howden, where is Opa Locka?
Mr. HowDEN. It is located, I believe, about 18 miles from the court-
house. It is j ust north of the Miami Naval Air Station.
The Chairman. Is it in Dade County ?
Mr. HowDEN. Yes, sir.
The Chairman. How large a town is it ?
Mr. HowDEN. It has a population according to the last census, I
believe, of about 8,000.
The Chairman. Who is Red Rainwater?
Mr. HowDEN. He is a local gambler. I believe he is interested in
numbers and some slot machines.
The Chairman. Does he have that reputation and is he well known
as a gambler ?
Mr. HowDEN. Yes, sir.
The Chairman. Any questions. Senator Hunt ?
Senator Hunt. No.
The Chairman. Thank you, Mr. Howden. Now, is Mr. Burk here?
TESTIMONY OF THOMAS G. BURK, DEPUTY SHERIET,
DADE COUNTY, FLA.
Mr. Burk. Here.
The Chairman. Mr. Burk, do you solemnly swear that the testi-
mony you will give this committee will be the truth, the whole truth
and nothing but the truth, so help you God ?
Mr. Burk. I do. Yes, sir.
The Chairman. Now, Mr. Burk, you have been subpenaed to come
here and testifv, is that correct?
Mr. Burk. That is correct.
The Chairman. You, of course, understand that you are under
oath in giving this testimony?
Mr. Burk. Yes, sir.
The Chairman. All right, Mr. Halley.
Mr. Halley. Did you hear the testimony of the last witness ?
Mr. BuiiK. I did, sir.
Mr. HaTvLey. Plis name is R. W. Howden, is that right ?
Mr. Burk. Correct.
ORGANIZED CRIME' IN INTERSTATE COMMERGE 195
Mr. Halley. Do you know the last witness?
Mr. BuRK. Only by working with him.
Mr. Halley. Did you work with him in the sheriff's office ?
Mr. BuRK. We worked there in the same department.
]VIr. Halley. What department was that?
Mr. BuRK. The criminal department in the sheriff's office of Dade
County, State of Florida.
Mr. Halley. Was he attached to your gambling squad ?
Mr. BuRK. Now and then he would go out ; yes, sir,
Mr. Halley. Was that his principal duty ?
Mr. BuRK. No, sir.
Mr. Halley. What is your principal duty in the sheriff's oiBce ^
Mr. BuRK. I took care of the criminal court of record, the bail in
tlie court, served papers and in the meantime went out and made
pinches of operating gambling houses.
Mr. Halley. Do you desire to comment on the testimony of the last
witness?
Mr. BuRK. Say that again, please.
Mr. Halley. Do you desire to comment on the testimony of Mr.
Howden ?
Mr. BuRK. In other words, it is false.
Mr. Halley. Did you have a conversation of any kind with Mr.
Howden about 2 weeks ago?
Mr. BuRK. I did.
Mr. Halley. Did you meet him on the street?
i\Ir. BuRK. I did.
Mr. Halley. In the vicinity of the courthouse ?
Mr. BuRK. Yes, sir.
Mr. Halley. Would you state what the conversation was between
j you and Mr. Howden ?
Mr. BuRK. What I said, you mean ?
Mr. Halley. Yes ; and what he said.
Mr. BuRK. We met at a parking lot on Northwest First Street just
west of tlie railroad tracks. He said, "How are you doing, Mate T'
I said, "I am doing all right." He said, "How are you getting along
on the farm?" and I said, "Fine." I said, "What are you doing?"'
and he said something about still working for the insurance peoi)le.
He said, "What do you know, I have seen George the Greek."
(ieorge the Greek had been working in the sheriff's office upstairs in
tlio criminal department. I said, "What is the matter with him,"
i and he said, "I was talking with him and and was kidding with him."
! Now, this boy that was here he said he was kidding with George the
Greek. He said, "George, how are you feeling?" and he said, "I am
doing all right." He says, "You know they got something on you."
and he said, "I ain't giving a God damn what they got on me."
That is what Dick Howden told me.
Mr. Halley. What did you have in mind, both have in mind?
Mr. BuRK. I didn't ask. I was subpenaed to come to court that
morning and didn't have much time.
Mr. Halley. You have no idea what anybody might hare on
' Howden ?
Mr. BuRK. No, sir.
196 ORGANIZED ORIIME IN INTERSTATE COMMERCE
Mr. Halley. Is it true that you have, as alleged by Mr. Howden,
given large sums of money in cash in amounts of $7,000, $8,000,
$10,000, and $11,000 to Mrs. Jimmy Sullivan?
Mr. BuEK. That is false.
Mr. Halley. Have you ever given any sums of money in cash to
Mrs. Jimmy Sullivan ?
Mr. BuEK. No, sir. That is false.
Mr. Halley. Have you ever given any sums of money to Jimmy
Sullivan, the sheriff?
Mr. BuRK. No, sir ; that is false.
Mr. Halley. Did you in 1949 have a conversation with Mr. How-
den about his taking the job of chief of police at Opa Locka?
Mr. BuRK. A few words ; yes, sir. He told me. He said, "Tom, I
got a break. I believe I am going out to Opa Locka as chief of police."
I said, "That is a nice community. Why don't you go out there?"
Mr. Halley. And during that conversation was a man named Red
Rainwater mentioned at all ?
Mr. BuRK. Not by Tom Burk.
Mr. Halley. Was he mentioned by R. W. Howden ?
Mr. Burk. No, sir.
Mr. Halley. Have you ever read about him in the newspapers ?
Mr. Burk. Yes, sir.
Mr. Halley. Do you know who he is ?
Mr. Burk. I could pick him out of a crowd; yes, sir.
Mr. Halley. You could pick him out of a crowd?
Mr. Burk. Yes, sir. I arrested him twice operating
Mr. Halley. Was it an error when the first time I asked you whether
you heard of Red Rainwater and you said, "No, sir"?
Mr. Burk. There is two of them.
Mr. Halley. Wliich one of them haven't you heard of?
Mr. Burk. One is a lawyer here and one is operating book.
Mr. Halley. If you know of the two of them how could you not
have heard of either one of them ?
Mr. Burk. One I don't know.
Mr. Halley. Do you remember having told Howden that you would
fix him up with a cut of the gambling in Opa Locka ?
Mr. Burk. No, sir.
Mr. Halley. You never told him anything like that ?
Mr. Burk. No, sir.
Mr. Halley. What is Red Rainwater's business in Opa Locka?
Mr. Burk. I wouldn't know, sir.
Mr. Halley. Is he in the gambling business ?
Mr. Burk. I wouldn't know, sir.
Mr. Halley. You have no idea ?
Mr. Burk. No, sir.
Mr. Halley. Even by reputation ?
Mr. Burk. No, sir.
Mr. Halley. You arrested him twice ?
Mr. Burk. Not in Opa Locka; the city of Miami.
Mr. Halley. Wliat did you arrest him in Miami for ?
Mr. Burk. Operating a gambling house.
Mr. Halley. "VVliat is his business in Miami ?
Mr. Burk. I believe he is in the business of chartering books.
Mr. Halley. Does he do any gambling business ?
ORGANIZED CRIIME IN INTERSTATE COMMERCE 197
Mr. BuRK. When I seen liini he was and I picked him up.
Mr. Halley. You saw him gambling?
Mr. BuRK. I didn't see him gambling, but I took his place and took
him.
Mr. Halley. And you saw him operating a gambling establishment
on two occasions?
Mr. BuRK. No, sir ; on one occasion. I lost one case with him.
Mr. Halley. In the other case he was convicted ?
Mr. BuRK. Correct.
Mr. Halley. Did you ever tell anybody that you were "in on the
take*'?
Mr. BuRK. Take of what?
Mr. Halley. Take a bribe ?
Mr. BuRK. No, sir.
Mr. Halley. When did you enter the sheriff's office?
Mr. BuRK. On January 1, 1944.
Mr. Halley. What had you been doing previously?
Mr. BuRK. Since August 1, 1949, 1 went on a farm.
Mr. Halley. You quit the sheriff's office in 1949; is that right?
Mr. BuRK. Correct.
Mr. Halley. Did you purchase that farm?
Mr. BuRK. Yes, sir; with mortgages.
Mr, Halley. What was the purchase price of the farm ?
Mr. BuRK. $26,700— $26,725.
Mr. Halley. How much of that did you pay in cash?
Mr. BuRK. $1,000 and $4,000, $5,000. There was a $10,750 moi-t
gage on it and I paid $1,000 and $4,000. I paid $26,750.
Mr. Halley. You paid $26,750
Mr. BuRK. For the place and it is mortgaged.
Mr. Halley. How much of that did you pay in cash ?
Mr. BuRK. $5,000.
Mr. Halley. $5,000?
Mr. BuRK. That is correct.
Mr. Halley. Do you operate that as a farm ?
Mr. BuRK. Yes, sir.
Mr. Halley. You are retired, in other words?
Mr. BuRK. You can call it that, but I am up to my knees in
mortgages.
Mr. Halley. Do you own them or are you the debtor on these
mortgages ?
Mr. BuRK. I have a home mortgage and I still owe $15,000 and
something on the place yet. I pay rent ; you know what I mean.
Mr. Halley. But you don't work for a living anymore?
Mr. BuRK. I work in the grove, yes ; planting tomatoes, pears, and
mangoes. Sure, I work.
Mr. Halley. Did you have a farm before you went into the sheriff's
office?
Mr. BuRK. I was a nurserj' man.
Mr. Halley. For how many years?
Mr. Bltrk. Oh, maybe about seven or eight.
Mr. Halley. During what period ?
Mr. BuRK. Oh, say 1900.
Mr. Halley. And between around 1900 and 1949 you did no
farminjr?
198 lORG'ANIZED CRIME IJST INTE'RSTATE COMMERCE
Mr. BuRK. No, sir ; only around the house.
Mr. Halley. You don't maintain that you are operating this farm
to earn a living now, do you?
Mr. BuRK. I do.
Mr. Hali.ey. What is the amount of money you earned on this farm
in the last year ?
Mr. BuRK. In the year 1949 I paid the internal revenue, $1,069,
Mr. Halley. Tax?
Mr. BuRK. Income tax.
Mr. Halley. Was that income from the farm ?
Mr. BuRK. Yes, sir — not all from the farm ; no, sir.
Mr. Halley. What was the remainder of that income ?
Mr. BuRK. The remainder of the income I think — close to $5,000 I
took from the farm and I got about $4,100 that I put extra miscella-
neous gambling.
Mr. Halley. What kind of gambling was that?
Mr. BuRK. At the Hialeah Race Track.
Mr. Halley. You mean, you just went in and won $1,000 on mis-
cellaneous bets?
Mr. BuRK. That is correct. In the last week in the month of Janu-
ary I had some warrants in my hands to execute them. I went to the
Hialeah track, met a couple of the boys and made a bet and collected.
Mr. Halley. Was that a single bet ?
Mr. BuRK. It wasn't what you call a big bet ; no.
Mr, Halley. What did you make on the one bet ?
Mr. BuRK. I got about $2,600 on the first bet and collected my man
and brought him back,
Mr. Halley. Did you make any more income on bets at the race
track ?
Mr. BuRK. Yes, sir.
Mr. Halley. How much ?
Mr. BuRK, About $4,100.
Mr. Halley. About $4,100 ?
Mr. BuRK. Yes, sir.
Mr. Halley. These were bets you made in cash Avith the mutuel
machine ?
Mr. BuRK, Yes, sir.
Mr. Halley. And you declared those profits on your income-tax
returns ?
Mr. BuRK. Yes, sir.
Mr. Halley. Are you sure you weren't paying income on some cash
you got in some other way ?
Mr. BuRK. No, sir.
Mr. Halley, Did you hear Mr, Howden testify that j^ou had stated
to him that you took care of Uncle Sam ?
Mr. BuRK. Yes — I don't quite understand what he meant by that.
Mr. Halley. Well, I believe he explained he meant that you paid
your income tax on whatever cash you took.
Mr. BuRK, Those words were never used.
Mr. Halley. But you did take care of Uncle Sam on this ffambline
profit?
Mr. BuRK. If you want to say 1 took care of Uncle Sam, I did. I
paid my income tax. Is that what you mean?
ORGANIZED CRIME. IN INTERSTATE COMMERCE 199
Mr. Halley. It is not customary among people you know to declare
on race-track profits.
Mr. BuKK. He asked me, "Did you make any money?" and I said,
"Yes."
Mr. Halley. Have you in previous years declared winnings on
horse races?
Mr. BuRK. No, sir.
Mr. Halley. Just this year?
Mr. BuRK. Well, in 1948 and 1947.
Mr. Halley. You also declared race-track winnings?
Mr. BuRK. A few dollars ; yes, sir.
Mr. Halley. Well, how much ?
Mr. BuRK. Maybe about $900, $400.
Mr. Halley. In any other years did you declare race-track win-
nings?
Mr. BuRK. No, sir.
Mr. Halley. What was the horse you won $2,600 on ?
Mr. BuRK, I wouldn't know the horse's jiame. You go by numbers.;
Mr. Halley. You have no idea of the horse's name?
Mr. Burke. Three or four horses.
Mr. Halley. Do you remember the name of the jockey who made
that money for you ?
Mr. Burk. No, sir.
Mr. Halley. Just a complete blank?
Mr. Burk. Yes, sir.
Mr. Hali>ey. How often have you won $2,600 on horse racmg?
Mr. Burk. The first time.
Mr. Halley. Never before in your life ?
Mr. Burk. No, sir. In fact, I was never much on playing the
horses.
Mr. Halley. Do you OAvn any other property in addition to the
farm you described?
Mr. Burk. Yes, sir.
Mr. Halley. Will you state what it is ?
Mr. Burk. The home.
Mr. Halley. Where is that ?
]Mr. Burk. It is located at 2497 Twenty-first Terrace, city of Miamiy
Dade County.
Mr. Halley. When did you purchase the home?
Mr. Burk. In 1946.
Mr. Halley. That was the year after you went to the sheriff's^
office.
Mr. Burk. That was 2 years.
Mr. Halley. Two years after?
^Ir. Burk. Yes.
Mr. Halley. What did 3'ou pay for that home?
Mr. Burk. I paid $8,00() down' for the home.
Mr. Halley. You put down $8,000 in cash ?
Mr. Burk. Correct ; cash.
Mr. Halley. What did the liome cost?
Mr. Burk. $11,000.
Mr. Halley. You paid $8,000 of the $11,000 in cash ?
Mr. Burk. That is right.
68958 — 50 — pt. 1 14
200 ORGANIZED CRIME IN INTERSTATE COOVIMERCE
Mr. Hallet. Do you own any other property ?
Mr. BuRK. No, sir.
Mr. Halley. None whatsoever?
Mr. BuRK. No, sir.
Mr. Halley. Are you married ?
Mr. BuRK. Yes, sir.
Mr. Halley. Does your wife own any property ?
Mr. BuEK. No, sir.
Mr. Halley. Do you have any children ?
Mr. BuRK. No, sir.
Mr. Halley. Do you have any bank accounts ?
Mr. BuRK. In the year 1949 ; yes, sir.
Mr. Halley. How much did you have in the bank at the beginning
of 1949?
Mr. Btjrk. Nothing.
JNIr. Halley. Nothing?
Mr. BuRK. No, sir.
Mr. Halley. Will you state to the committee how much you had in
the bank during any time in 1949? What is the maximum amount?
Mr. BuRK. I don't think I put any money in the bank until August ;
probably $3,000.
Mr. Halley. Where did you get that $3,000.
Mr. BuRK. That came from checks from the grove.
Mr. Halley. From the grove ?
Mr. BuRK. Yes, sir.
Mr. Halley. From the sale of fruit ?
Mr. BuRK. That is correct.
Mr. Halley. And you put that in the bank?
Mr. BuRK. Regular channels ; yes, sir.
Mr. Halley. Up to that point did you have a bank account ?
Mr. BuRK. No, sir.
Mr. Halley. How did you pay for the house when you paid $8,000
down?
Mr. BuRK. I have been in the city of Miami, Dade County, for 30
years and never was out of employment. I made a few dollars and
that was my savings.
Mr. Halley. Where did you keep your savings, in a shoe ?
Mr. BuRK. In the house.
Mr. Halley. In a box ?
Mr. BuRK. Yes, sir.
Mr. Halley. A tin box ?
Mr. BuRK. Yes, sir.
Mr. Halley. Where did you keep the $8,000 ?
Mr. BuRK. In the house.
Mr. Halley. And where did you keep the $5,000 that you used to
buy the farm ?
Mr. BuRK. I didn't make that until 1949.
Mr. Halley. How did you make that $5,000 ?
Mr. BuRK. One thousand dollars I had from the race track and
then I got a note for $4,000 which is pending yet. That was $5,000.
Mr. Halley. How did you get the note for $4,000 ?
Mr. BuRK. I got a note.
Mr. Halley. How did you get a note ?
Mr. BuRK. M}'
ORGANIZED CRIIME IN INTBRSTAT'E OOMMEROE 201
Mr. Halley. Will you describe that transaction ?
Mr. BuKK. My sister-in-law.
Mr. Halley. Your sister-in-law ?
Mr. BuRK. That is right.
Mr. Halley. You mean, she loaned you $4,000 ?
Mr. BuKK. Yes, sir.
Mr. Halley. That was not your money ?
Mr. BuRK. No, sir. That was to bargain to sell the other house.
Mr. Halley. Did you ever sell the other house ?
Mr. BuRK. No, sir.
Mr. Halley. Has your sister-in-law asked
Mr. BuRK. It was mortgaged.
Mr. Halley. Has your sister-in-law asked you for the money?
Mr. BuRK. No ; she hasn't asked yet. I paid her $500 back already.
Mr. Halley. By check?
Mr. BuRK. Yes, sir.
Mr. Halley. I thought you had no checking account ?
Mr. BuRK. That came after August 1.
Mr. Halley. You opened a checking account with the profits of the
farm?
Mr. Btjrk. Later in August, yes, sir, in 1949.
Mr. Halley. What made you decide after you had the farm to put
trust in banks ?
Mr. BuRK. It was all checks and I couldn't handle it.
Mr. Halley. You mean, the money you got before 1949 was cash?
Mr. BuRK. I didn't start in 1949. It was in August 1949 when I
started putting it in the bank.
Mr. Halley. That was because you got checks ?
Mr. BuRK. Yes.
Mr. Halley. Are we to assume that the $8,000 you accumulated to
buy your house in 1946 you got in cash ?
Mr. BtJRK. That was in cash. That was my savings, yes, sir.
Mr. Halley. Wliat was your salary as a deputy sheriff?
Mr. BuRK. When I first went to work I think it was $300 and when
I finished it was $350.
Mr. Halley. $300 a month ?
Mr. BuRK. I think when I finished it was $350.
Mr. Halley. You say you became a deputy sheriff in 1944?
Mr. BuRK. First day of January, 1944.
Mr. Halley. What was your occupation prior to January 1944 ?
Mr. BuRK. I was manager of the Police Benevolent Association of
the City of Miami, Dade County.
Mr. Halley. What was your rate of compensation in that job?
Mr. BuRK. I don't know.
Mr. Halley. Was it more than $50 a week?
Mr. BuRK. I don't know.
Mr. Halley. Was it more than $40 a week?
Mr. BuRK. I don't know.
Mr. Halley. Was it more than $30 a week ?
Mr. BuRK. You mean the wages ?
Mr. Halley. Yes.
Mr. BuRK. It was $35.
Mr. Halley. Thirty-five dollars a week?
Mr. BuRK. Yes.
202 ORGANIZED CRIME IN IN^TERSTATE COMMERCE
Mr. Halley. How long did it take you to save that $8,000 in cash?
Mr. Burke. Oh, about 18 to 20 years.
Mr. Halley. All that time you kept that money in a box in your
house ?
Mr. Burke. Yes, sir.
Mr. Halley. And then a vear after vou became deputy sheriff you
bought a house for $8,000 — -
Mr. Burke. That is correct.
Mr. Halley. In cash?
Mr. BuRK. Tlie Avar broke loose and the wife and I got together and
we thought we better get something now. I thought I had a decent
job to carry on.
Mr. Halley. Do you know a Mr. Crosby ? Tom Crosby.
Mr. BuRK. I know a Bill Crosby.
Mr. Halley. You know a Bill Crosb}^?
Mr. BuRK. Yes.
Mr. Halley. Wlio is he ?
Mr. BuRK. I think I was introduced to Bill Crosby one day in the
sheriff's office up on the nineteenth floor in the county courthouse as an
investigator for the Governor of the State of Florida.
Mr. Halley. In what year?
Mr. Burke. In 1948.
Mr. Halley. In 1948?
Mr. BuRK. 1948.
Mr. Halley. Could it have been 1949?
Mr. BuRK. It might have been 1949, the first G months, tliat is right.
Mr. Halley. It was the early part of 1949?
Mr. BuRK. The early part of 1949.
Mr. Halley. About January?
Mr. BuRK. That is right.
Mr. Halley. Right after Governor Warren was elected?
Mr. Bltrk. That is correct ; I am sorry.
Mr. Halley. Practically immediately afterward?
Mr. BuRK. That is right.
Mr. Halley. Who introduced you to Mr. Crosby?
Mr. BuRK. The sheriff of Dade County, Jimmy Sullivan.
Mr. Halley. What did Jimmy Sullivan tell you ?
Mr. BuRK. One day, I don't just remember the date, the sheriff' left
an order with the chief criminal investigator, Jim Hawkins, notifying
me not to go out to serve any papers. He said he would like to see
me. Well, I stayed after lunch. I came up and went back in the
criminal office up there and Sullivan was there and Mr. Crosby. The
sheriff said, "Tom, I want to introduce you to a fellow by the name
of Bill Crosby. He i-epresents the Governor's office. I want you to
take him any place where he wants to go regardless of where it is so
long as it is in Dade Countv."
I said, "O. K., sheriff."
Mr. Halley. Was Mr. Crosby supposed to be investigating any-
thing in particular?
Mr. Bi^RK. Not that I know of.
Mr. Halley. Gambling?
Mr. BuRK. The way we started that woidd be the only thing he
wont to.
ORG'AJSriZED CRIME IN INTERSTATE OOMMEROE 203
Mr. Halley. Slot machines?
Mr. BuRK. I guess anything; operated.
Mr. Halley. Let's be specific. Didn't Mr. Crosby say lie was sup-
posed, he was there to investigate slot machines in Dade County ?
Mr. BuRK. He told that to the sheriff maybe, but I didn't hear it.
Mr. Halley. He didn't tell that to you ?
Mr. BuRK. No.
Mr. Halley. But did the sheriflf tell you Crosby was there to inves-
tigate slot machines?
Mr. BuRK. No, sir.
Mr. Halley. Did you have that conversation in the morning, of a
particular day?
Mr. BuRK. No; I believe it was after lunch.
Mr. Halijsy. Then what happened?
Mr. BuRK. Bill Crosby and I left. We went to the beach.
Mr. Halley. You mean 3'ou got into an automobile?
Mr. BuRK. That is correct.
Mr. Halley. Whose car?
Mr. BuRK. My car.
Mr. Halley. Your personal car or an official car?
Mr. BuRK. My car.
Mr. Halley. Your personal car ?
Mr. BuRK. That is right.
Mr. Halley. What kind of an automobile was that ?
Mr. BuRK. It was a Chrvsler.
Mr. Halley. A Chrysler?
Mr. BuRK. Yes.
Mr. Halley. What year ?
Mr. BuRK. 1948.
Mr. Halley. 1948 Chrysler?
Mr. BuRK. Yes.
Mr. Halley. What model?
Mr. BuRK. New Yorker.
Mr. Halley. That is the large one ?
Mr. BuRK. No; there is an Imperial.
Mr. Halley. There is one bigger?
Mr. BuRK. Yes.
Mr. Halley. What did you pay for that Chrysler automobile?
Mr. BuRK. I turned my other car in. I turned in my 1944 or 1945
Dodge, and I had to pay I think it was $92 to the finance man.
Mr. Halley. You mean somebody gave you a brand new Chrysler
in return for a 1944 Dodge ?
Mr. BuRK. Well, no.
Mr. Halley. How much money did you pay for the Chrysler auto-
mobile ?
Mr. BuRK. I just don't remember what I laid down.
Mr. Halley. You paid money for it?
Mr. BuRK. I had to give something in order to get it off the floor;
that is correct.
Mr. Halley. How much did you give?
Mr. BuRK. I just don't remember what it was.
Mr. Halley. Did you then pay it out monthly or
Mr. BuRK. Paid with the finance man.
Mr. Halley. You financed it?
204 'ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. BuRK. That is right.
Mr. Hallet. And you paid monthly ?
Mr. BuRK. That is right.
Mr. Halley. How much was the total price of that Chrysler ? Ap-
proximately over $2,000?
Mr. BuRK. Yes, sir.
Mr. Halley. Close to $3,000, wasn't it?
Mr. BuRK. I think it was $2,600.
Mr. Halley. $2,600 ?
Mr. BuRK. Yes, sir. Maybe it was a little more.
Mr. Halley. It might have been a little over that?
Mr. BuRK. It might be.
Mr. Halley. Did you handle that out of savings, too?
Mr. BuRK. Yes, sir.
Mr. Halley. Now to get back to Crosby ; where did you go ?
Mr. BuRK. We went to Miami Beach.
Mr. Halley. What did you do there ?
Mr. BuRK, After we crossed the causeway he directed me to go,
where to go.
Mr. Halley. Where did he direct you to go ?
Mr. BuRK. I believe the first place we went to Avas up at some hotel
on Collins Avenue.
Mr. Halley. What hotel was it ?
Mr. BuRK. I can't remember. I just don't remember. And we took
the place — knocked the place off and they were convicted and paid their
fine.
Mr. Halley. What were they doing there ?
Mr. BuRK. OperatinjL^.
Mr. Halley. Operating what ?
Mr. BuRK. Book or horse.
Mr. Halley. Horse parlor?
Mr. BuRK. You can call it that ; yes.
Mr. Halley. No slot machines ?
Mr. BuRK. No.
Mr. Halley. Were there any slot machines in the lobby ?
Mr. BuRK. No, I don't think so. I didn't see no slot machines.
Mr. Halley. You didn't see any slot machines over there?
Mr. BuRK. No, sir. There was a barroom.
Mr. Halley. Where did you go after the first hotel that you knocked
off?
Mr. BuRK. We took the defendant back to the county jail and booked
him. He went out on $500 bond.
Mr. Halley. Then what did you do ?
Mr. BuRK. I don't think we went out that day any more.
Mr. Halley. Did you go out on a subsequent day ?
Mr. BuRK. We might have went out probably the following day or
the day after.
Mr. Halley. What happened the next time you went out?
Mr. Btjrk. We went to the beach, went around by the courthouse,
which is located down Meridian Avenue and First Street, and he says,
"Tom, let's go up Washington Avenue." We went up Washington
Avenue and he savs, "Pull over there at Fourth Street and Washing-
ton Avenue." "We are going into that apartment house." he said. I
didn't say anything. As I pulled up to the curbstone there was one
ORGANIZED CRilME IN INTERSTATE COMMERCE 205
of our men, George the Greek. As I pulled up I said, "What are you
doing here, George?" and he said, "I am serving a paper." I said,
"Since when do you work for the civil department?" and he says,
"I don't work for the civil department. I am just checking up on a
couple of joints." I said, "That is fine."
Mr. Halley. Let us get this stra'ght. You found George the Greek
in the bookmaking establishment ?
Mr. BuRK. No, sir. He was on the curbstone.
Mr, Halley. He wasn't in the establishment?
Mr. BuRK. No, sir.
Mr. Halley. But he didn't belong in that part of town at all, is
that right ?
Mr. BuRK. It looked funny to me because he was working on the
telephone. That was where liis duty was on the telephone and when
I seen him he was on the curbstone waiting.
Mr. Halley. Then what happened ?
Mr. BuRK. So George spoke to Mr. Crosby. He said a few words.
He said, "We are going to take that place."
Mr. Halley. Who said, "We are going to take that place" ?
Mr. BuRK. Mr. Crosby.
Mr. Halley. Then what happened ?
Mr. BuRK. So I asked Crosby, I says, "What is going on here?"
and he says, "It is one of the joints." I said, "You got a warrant?"
I said to George the Greek, "You got a warrant?" and he said, "No,"
I said, "Go ahead, let's see what you can do."
So they went in and I followed them. They had a guy in the hall
up against the wall. George the Greek had this fellow against the
wall with his hands in his pockets, I approached the place and
I said, "George, what is wrong?" and he said, "He just come out of
the door clown there." I said, "You can't put your hands in his pockets
iniless 3^ou got a warrant. You can't put your hands in anybody's
pockets unless you got a warrant. You haven't put the boy under
arrest yet, have you?" and he said, "Well, I have seen him come from
that door." I said, "Go ahead, make the arrest and see where it will
get you,"
So, he turns the guy loose and he walked up and down the hall
once or twice or three or four times. So I says, "That is the door,"
I busted the door in. I just remember the number of the door. I
do remember the joint was 450 Washington Avenue. When we got
in there I broke in the door and I broke into a bedroom. There were
two beds in that room and there was another door. I knocked that
one down.
And that is what I had seen.
Mr. Halley. What did you see ?
Mr. BuRK. I seen about four or five men in there.
Mr. Halley. What were they doing ?
Mr. BuRK. Just sitting around the table just like these gentlemen
are sitting around here [indicating],
Mr. Halley. There were no telephones ?
Mr. BuRK. There was telephones, there ; yes, sir,
Mr. Halley. Were they operating book?
Mr. BuRK. I believe it was an office.
Mr. Halley. You believe it was an office ?
206 ORGANIZED CRIME IX INTERSTATE COMMERCE
Mr. BuRK. Yes.
Mr. Halley. What kind of an office ?
Mr. BuRK. Horse booking.
Mr. Halley. Horse-booking office ?
Mr. BuRK. There are two ends to this; a parlor and an office and
a room are two different things. When you talk "horse booking,"
that is an office. If j^ou are going into a horse room, that is where
they have sheets.
Mr. Halley. All of the time Mr. Crosby was with you ?
Mr. BuRK. Correct.
Mr, Halley. He came right along behind you ?
Mr. BuRK. Yes.
Mr. Halley. Did you arrest the men that you found in that room?
Mr. BuRK. I made no arrest, because I couldn't make it stick. I
broke the joint down, broke it open. I said, "Do you want to file,"
and he said, "I can't file."
Mr. Halley. Who said that ?
Mr. BuRK. Crosby. I said, "Why not — you are well heeled."
Mr. Halley. What do you mean by "you are well heeled" ?
Mr. BuRK. He had a gun on. He said, "I can't file. I don't know
what to do. There is no use to file on them. Their mouthpiece will be
helre."
Mr. Halley. By "mouthpiece" do you mean the lawyer?
Mr. BuRK. Attorney.
Mr. Halley, Did you have a pretty good idea who the mouthpiece
was going to be ?
Mr. BuRK. We found out afterward. He came there,
Mr, Halley, Who was it?
Mr, BuRK, Mr, Bennie Cohen,
Mr. Halley. Was Bennie Cohen the mouthpiece for the S. & G.
boys ?
Mr. BuRK. I don't know. I just heard about that.
Mr. Halley. You know the S. & G. ?
Mr. BuRK. Well, I have heard so much over the grapevine,
Mr, Halley, What have you heard ?
Mr, BuRK. I have heard of one or two guys like Jules Levitt. Just
the w^ay the paper says, and we always see another new name in the
gang.
Mr. Halley. Whose new name did you see ; whose new name in the
gang?
]\Ir. BuRK. Every time we see it they had a new name.
Mr. Halley. Would the new name in the gang be Harry Russell?
Mr, BuRK. I never heard of Harry Russell.
Mr. Halley, You never heard the name Harry Russell before today ?
Mr, BuRK, Only today,
Mr, Halley, I think we had better stop here and jiause because
we are going a little too fast. You are under oath and the question
of 2")erjury goes just as much to what you heard as to what you did
■or didn't do. Now, did you ever hear before this day of Harry
Russell ?
Mr. BuRK. No. sir.
Mr. Halley. You never heard of him?
Mr, BuRK. No,
ORGAJSriZED CRIIME IN INTERSTATE COMMERCE 207
Mr. Halley. Not even in the newspapers?
Mr. BuRK. Only what I seen in the papers.
Mr. Halley. You never heard his name spoken by anyone?
Mr. BuRK. No, sir,
Mr. Halley. To jjo on with tlie pinch with Crosby. What hap-
pened after your conversation in which you tokl him to make the
pinch ?
Mr. BtiRK. Well, 10 or 15 minutes went by and all of a sudden
here comes Jules Levitt and his attorney, and he says, "What are you
doing?"
]Mr. Halley. Were you still in the house ?
Mr. BuRK. We were sitting in the bedroom.
Mr. Halley. Was Levitt there already ?
Mr. BuRK. In about 15 minutes.
Mr. Halley. He must have had a pretty good idea of what was
going on.
Mr. BuRK. No phone rang.
Mr, Halley, You had not made the pinch?
Mr. BuRK. No.
Mr. Halley. Jules Levitt walked into the bookmaking establish-
ment ?
Mr, BuRK, About 10 minutes afterward.
Mr. Halley. Who was with him?
Mr. BuRK. Bennie Cohen, his attorney.
Mr. Halley. Bennie Cohen?
Mr. BuRK. Yes.
Mr, Halley. What conversation f ollow' ed ?
Mr, BuRK, And then Jules said to me, "What are you doing here?
Do you have a warrant?" I said, "No," and he said, "How did you
get in; who broke the door down?" I said, "We did," and he says,
"All right, we will take care of that." So Jules Levitt walked up
the hall with Mr. Crosby about 20 feet away and the conversation
was going on up there, so I couldn't hear it. I was still in the room,
right there on the threshold looking one way and then the other.
Mr. Levitt comes back and Mr. Crosby comes back and says, "Well,
we made a deal. We will take in one." I said, "You will take all
or none. If I have to file on them, I am going to take all or none,
because our office don't work like that."
Mv. Halley. What happened next?
Mr. BuRK. He said, "Well, we will come to the conclusion that we
will settle the matter that way." I said, "I couldn't see just taking-
one." We will take all or none, I said.
Mr. Halley. What happened then?
Mr. BuRK. We didn't take any.
Mr. LIalley. Would you state the names of these people that you
found in this bookmaking establishment?
Mr. BuRK. We took no names at all.
Mr. Halley. Did you file a report ?
INIr. BuRK. We ran them all out of the place, closed up the place,
told them to move and get out and stay out. ' I had no grounds to
make a pinch.
INIr. Halley. AVhat grounds did you have to tell them to move out
and get out and stay out, if you had no grounds to make a pinch?
208 org'Ajstized criime ix interstate oommerce
Mr. BuRK. After breaking the door down I told them that if they
didn't move and stay out I %Yould be back there in half an hour and I
would make a pinch.
JNIr. Halley. Did they move out in your presence ?
Mr. BuRK. No. George and I came back home.
Mr. Halley. Did you come back in half an hour to see if they had
moved ?
Mr. BuRK. Yes; with a search warrant.
Mr. Halley. Where did you get the search warrant?
Mr. BuRK. I believe the search warrant was made out by a circuit
judge. I don't remember whether it was Hawthorne, Milledge, or
who, because I didn't file the affidavit for it. I think George the
Greek did. Anyway, I didn't file it,
Mr, Halley. Dicl you go back with Crosby with the search war-
rant?
Mr. BuRK. Yes.
Mr, Halley. What happened at that time ?
Mr. BuRK. We went back there and the joint looked like a dance
hall; they moved the crowd out — in other words, everything was
vacated.
Mr. Halley, No equipment there ?
Mr, BuRK, No,
Mr, Halley, None of the men there ?
Mr. BuRK. There wasn't a soul in the place.
Mr, Halley, Were you surprised to find the place empty?
Mr. BuRK. Well, from common sense, if they were there they sure
would have got it,
Mr, Halley, You knew they wouldn't be there when you got back
with the search warrant, didn't you ?
Mr. BuRK, Personally I didn't ask for the warrant. I believe it was
Crosby.
Mr, Halley. What was the next thing that happened in your
transactions with Crosby?
Mr, BuRK. What?
Mr. Halley. What was the next thing that happened in connection
with Crosby ?
Mr. Bltrk. Nothing. I don't belie\'e I went out with him anymore.
Mr. Halley, Did you go back to the sheriff's office with him?
Mr, BuRK, No, I think we went up to some hotel again that we
pinched a couple of days before that. George the Greek and Mr.
Crosby had made the entrance into the place but they came out with
nothing,
Mr, Halley. Did you go to any other hotels or any other places?
Mr. BuRK, That day?
Mr, Halley. Yes.
Mr. BuRK. No.
Mr. Halley. Did you go with Mr. Crosby then to a total of only
two places altogether?
Mr. BuRK. I think he took me up to Collins Avenue around Twen-
tieth Street and he says, "1 believe that this is n joint over there and
we will have to get a warrant for it.'' He was just pointing to some
hotel.
Mr. Halley. What hotel was he pointing to?
Mr. BuRK. I don't know.
ORGANIZED CBIIME IN INTERSTATE COMMERCE 209
Mr. Halley. If he pointed to a hotel in that area, could you miss a
joint?
Mr. BuRK. Could we ?
Mr. Halt.ey. Does not practically every hotel in that area have a
bookie establishment in it ?
Mr. BuRK. I don't know. They could have but I didn't see them.
Mr. Halley. That is under your jurisdiction ?
Mr. BuRK. Yes.
Mr. Halley. You know that most of those hotels have bookmaking
establishments?
Mr. BuRK. No, sir ; I don't know that every hotel has.
Mr. Halley. I did not say every hotel. I said most of the hotels.
Mr. BuRK. Except that we seen none in any one of them hotels.
Mr. Halley. What happened after Crosby pointed to the hotel and
said, "I think there is a joint there ?"
]\Ir. BuRK. We didn't make any more headway.
Mr. Halley. Just what did you say ?
Mr. BuRK. I said, "Do you have a search warrant?" We even tried
lo go to the back door. I said, "How are we going to get in with this
front that I have and the front that you have got. We will never make
it."
Mr. Halley. Do you remember that Crosby had a map with him of
some places marked off on it ?
Mr. BuRK. That is correct.
Mr. Halley. Wlien did he first show you the map ?
Mr. BuRK. When we went out to Twenty-thircl Street and stopped
around Liberty Avenue and the Canal ; it was in front of a floral shop,
and he kept walking up and down and he said, "Tom, there is place
back in here," and I said, "Let's go back." So we went back and Crosby
didn't enter. We noticed that all the doors Avas locked and we couldn't
hear nothing, and then he said, "How about going out and see that
other place out there?" He knocked on the doors and nobody came
out. Then we went to this young lady behind the counter and we
asked her did she have a key. I said, "My name is Tom Burk of
the sheriff's office," and she said, "I don't have any keys to that room,
but I will call the landlord," so she picked up the phone and soon
Bennie Cohen came and soon Jules Levitt came.
Mr. Halley. Again at that place ?
Mr. Burk. Yes.
Mr. Halley. How soon did they appear after you announced your-
self to the girl as from the sheriff's office ?
Mr. Burk. In 10 minutes.
Mr. Halley. Was there any conversation ?
Mr. Burk. The conversation was between Mr. Crosby and the
attorney.
Mr. Halley. Bennie Cohen?
Mr. Burk. Yes.
Mr. Halley. You just pointed to ]\Ir. Bennie Cohen in this room ?
Mr. Burk. I meant to say that Mr. Crosby is back there.
Mr. Halley. Mr. Crosby is here too ?
Mr. Burk. Yes. I was sitting alongside of him all day.
Mr. Halley. What conversation was there between Bennie Cohen
and Crosby ?
Mr. Burk. Oh, I was about 12 to 15 feet away.
210 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Getting back to tliis map, didn't Mr. Crosby show you
a map with about 12 locations marked on it ?
Mr. BuRK. No.
Mr. Hallet. How many ?
Mr. BuEK. Just that one. Then when I went to the girl behind the
counter and asked if the landlord or landlady was there, these two
other gentlemen came on the scene and we went in that place to-
gether.
Mr. Halley. What did you find ?
Mr. BuRK. We opened the ice box first and the ice box was warm;
nothing in it. There were two telephones laying right there on the
counter.
INIr. Halley. Nothing at all in there ?
Mr. BuRK. No.
Mr. Halley. Did you make any effort to find out from the telephone
company what service that place had been getting?
Mr. BuRK. No.
Mr. Halley. Did you go back and report to Sheriff Sullivan about
Crosby ?
Mr. BuRK. No, sir.
Mr. BuRK. Did you make a report about your investigation?
Mr. BuRK. Yes.
Mr. Halley. Did you tell him that Crosby appeared to be looking^
for bookmaking establishments?
Mr. BuRK. There was nothing else said.
Mr. Halley. Isn't it a fact that both you and Sullivan had insisted
that Crosby was down here investigating slot machines ?
Mr. BuRK. That word I didn't hear — slot machines.
Mr. Halley. What word did you hear ?
Mr. BuRK. The sheriff told me to go with Crosby and to go to any
place where he wants to go. There was no name mentioned, circus,
gambling, or anything else, when we left the courthouse.
Mr. Halley. You didn't realize that 3^ou were going on a gambling
raid ?
Mr. BuRK. I had a slight feeling but I didn't know where in the hell
he was going. Wlien we go across from the police station he said,
"Tom, we will turn here at the police station and work Washington
Avenue."
Mr. Halley. Isn't it a fact that you went back to Sheriff Sullivan
and said, "This fellow Crosby here is trying to make cases against
bookmakers" ?
Mr. BuRK. No.
Mr. Halley. Isn't that wliat happened ?
Mr. BuRK. No.
Mr. Halley. How long after that did Crosby depart from IVIiami?
He didn't stay around, did he ?
Mr. BuRK. If he came in the office I didn't see him.
Mr. Halley. You never saw him again?
Mr. BuRK. No.
Mr. Halley. No more pinches were made?
Mr. BuRK. Yes, sir.
Mr. Halley. By Crosby ?
Mr. BuRK. I couldn't answer that. He never made a pinch.
ORG'AXIZED CRIME IN INTERSTATE OOIVEVIEROE 211
Mr. Hallky. You made tliom under liis direction?
Mr. BuRK. Only one.
Mr. HALr.EY. No more after that?
Mr. BuRK. Not with Mr. Crosby, no.
Mr. Halley. How many automobiles do you own today?
Mr. BuRK. One.
Mr. Halley. What kind?
Mr. BuRK. Chrysler.
Mr. Halley. '48?
Mr. BuRK. '50.
Mr. Halley. When did you buy it ?
Mr. BuRK. I bought it starch 8, 1950.
Mr. Halley. Does your wife own an automobile?
Mr. BuRK. No, sir.
Mr. Halley. What did you pay for the Chrysler that you own today ?
Mr. BuRK. I turned one in and got $1,700 on it and put $500 down
and me and the finance company haye got it yet.
Mr. Halley. What model Chrysler did you purchase this year?
Mr. BuRK. 1950.
Mr. Halley. A New Yorker again ?
Mr. BuRK. I don't know. I call it a station wagon.
Mr. Halley. That is more suitable on the farm?
Mr. BuRK. You can use it on a f ann.
Mr. Halley. What does a station wagon cost?
Mr. BuRK. This station wagon I got cost $1,600, and me and the
finance company still haye got it.
Mr. Halley. What are the monthly payments on it?
Mr. BuRK. I think it is $132.
Mr. Halley. A month?
Mr. BuRK. Yes.
Mr. Halley. That is all the questions I haye.
The Chairman. Just one more question. What was the date that
you won the $2,600 on the horse?
Mr. BuRK. I don't know. It was the last week in January or the
second week in January.
The Chairman. January what?
Mr. BuRK. '49.
The Ciiair.^ian. You do remember the occasion yery well?
Mr. Burk. Yes. I had a warrant to pick up a man at the race track.
The Chairman. Before serying the warrant you thought you would
play the horses a little yourself; is that right?
Mr. Burk. Yes. In other words, we had the man spotted. He had
a horse running and I didn't want to interfere with the race. He was
standing in the paddock after the horses went out.
The Chairman. You said that when you got the race track you
met a couple boys?
Mr. Burk. Yes.
The Chairman. What boys?
Mr. Burk. Dobson and his agent. Dobson was a jockey. I don't
remember the agent's name. I had done a f ayor for Dobson one time.
I belieye I had a warrant for Dobson one time.
The Chairman. So you spoke to Dobson, the jockey?
Mr. Burk. He was standing there.
The Chairman. By the horse he was going to ride?
212 • ORGANIZED ORttME IN INTERSTATE COMMERCE
Mr. BuRK. Yes.
The Chairman. And he gave you a tip on the horse ?
Mr. BuRK. He didn't ; the agent did.
The Chairman. How much did you bet on the horse ?
Mr. BuRK. I think I put $50 on his nose.
The Chairman. $50?
Mr. BuRK. Yes.
The Chairman. And you got $2,600 back?
Mr. BuRK. Not quite $2,600. I think he closed around 32 to 1, a
little over 30 to 1.
The Chairman. For $50 on his nose you got back $2,600 ?
Mr. BuRK. I got back about $2,600 ; yes.
The Chairman. What did you do with that money?
Mr. BuRK. Kept it.
The Chairman. You didn't put it in the bank ?
Mr. BuRK. No.
The Chairman. Did you have a bank, account prior to 1949?
Mr. BuRK. In the month of August ; yes.
The Chairman. Did you have one prior to that time?
Mr. BuRK. Yes, no. Yes.
The Chairman. How long did you have that one ? How long before
that did you have one?
Mr. BuRK. Oh, way back in 1921.
The Chairman. Between 1921 and 1949 j'ou did not have any bank
account ?
Mr. BuRK. I think it was around 2 or 3 years that I was riding a
motorcycle at the beach.
The Chairman. You handled all transactions in cash; is that
correct ?
Mr. BuRK. That's right.
The Chair:man. When was it that you bought the farm ?
Mr. BuRK. I think it was the 11th day of June.
The Chairman. What year?
Mr. BuRK. July.
The Chairman. Of what year ?
Mr. BuRK. 1949.
The Chairman. It was August 1949 that you had $3,000 in tha
bank ?
Mr. BuKK. No.
The Chairman. When did you have $3,000 in the bank?
Mr. BuRK. About September.
The Chairman. About September 1949 ?
Mr. BuRK. Yes.
The Chairman. At the time you bought the farm you paid $5,000
in cash?
Mr. Burk. I paid $1,000 cash and $4,000 I owed.
The Chairman. Shortly after you put $3,000 in the bank?
Mr. Burk. Every month the checks would come in and I had close
to $3,000 and maybe more.
The Chairman. Just a regular bank account?
Mr. Burk. Yes ; Coconut (irove Bank.
The Chairman. How long did you keep it in there?
Mr. Burk. Some of it is still there yet. . I
ORGANIZED CRIME IX INTERSTATE OOMJVIERCE 213
I
Tlie Chairman. You kept around $3,000 or nuiybe more in tliat
bank for some considerable time ?
Mr. BuRK. It ran up and down. Just as fast as the fruit payments
were coming in, and of course I was paying off bills.
The Chairman. Did you keep some cash in the tin box you told us
about?
Mr, BuRK, No, Once in a while we got cash for the fruit.
The CiiAiR3ix\N, You did have some money in the box at home
during the time j^ou had the $3,000 bank account?
Mr. BuRK. No,
The Chairman. Why didn't you use that $3,000 to pay something on
the $4,000 note ?
Mr. BuRK. I gave them $1,000 cash, and I gave a note for $4,000, I
believe it was, and I put $1,700 in the bank and I kept the rest.
The Chairman. You had to pay interest on the note, didn't you?
Mv. BuRK. That's right.
The Chairman. Your bank account wasn't drawing interest, was
it?
Mr. BuRK. No.
The Chairman. You paid $500 down and you signed a note for
$4,000?
Mr. BuRK. That's right.
The Chairman. And you have not paid the note yet?
Mr. Bui'.K. No.
The Chairman. That is all. Thank you.
TESTIMONY OF MELVIN J. EICHARD, CITY COUNCILMAN,
MIAMI BEACH, FLA.
The Chairman. Do you solemnly swear that the testimony you
will give the committee will be the whole truth and nothing but the
truth?
Mr. Richard. I do.
Mr. Halley. What is your occupation, Mr. Richard ?
Mr. Richard. I am an attorney.
Mr. Halley. Do you hold any official position ?
Mr. Richard. Yes. I am a city councilman in the city of Miami
Beach.
Mr. Halley, How long have j^ou occupied that position?
Mr. Richard. For a little over a 3'ear. It was June of last year I
was elected.
Mr. Halley. For how long a term were you elected ?
Mr. Richard. Four years.
Mr. Halley. During your campaign, and after, have you taken any
public position about gambling on Miami Beach?
Mr. Richard. Yes; I have strenuously opposed gambling activities
and the racket syndicates that operate them.
Mr. Halley. Did you do that during j^our campaign ?
Mr. Richard. Yes ; I did it during my campaign and in a previous
campaign in which I was not elected, and during the past 4 or 5 years,
since I was released from the Navy, I have been actively engaged in
work of that sort in the city of Miami Beach.
Mr. Halley. Have you made an effort to ascertain whether or not
the police department of Miami Beach was performing its duty ?
214 ORGANIZED OREME IN INTEKSTATE COMMERCE
Mr. Richard. I have on more than one occasion.
Mr. Halley. And in that connection did yon have any conversation
with any members of the police department ?
Mr. Richard. Yes ; I did.
Mr. Halley. Did you have any conversations with a man named
Phil Short?
Mr. Richard. Yes ; I did.
Mr. Halley. Would you state when you had such conversation?
Mr. Richard. I believe the date was May 10 and May 11 of tliis year.
The first conversation was a telephone conversation, which I recorded,
and the second conversation was a conversation in my office, which I
also recorded, but the second recordation was not a good record — it
was not a clear record.
I have the telephone conversation with me here, if you would like
to hear it.
Mr. Halley. Do you recall the second conversation ?
Mr. Richard. Yes ; I do recall the content of the second conversation.
Mr. Halley. But of the first you do actually have the recording ?
Mr. Richard. Yes ; I have it.
Mr. Halley. With the permission of the committee, may the witness
produce the recording ?
The Chairman. Yes.
Mr. Halley. Will you produce the recording, please?
Mr. Richard. Yes, sir. It's in a wire-recording machine.
Mr. Halley. Before you produce the recording, may I ask you this
question: Who was Phil Short with whom you had the conversation?
Mr. Richard. Phil Short is an officer in the Miami Beach police
department now. I believe he is a lieutenant. He previously was
chief of police until after this last election.
Mr. Halley. Will you go ahead with the recording?
Mr. Richard. Surely.
(The following is a typewritten transcription of the wire recording
played to the committee by Mr. Richard :)
A Voice. Police headquarters.
Voice. Is Lieutenant Short there?
Voice. No ; he's not ; he's out in the garden.
Voice. This is Melvin Richard. Could you get him to call me?
Voice. Just a minute ; here he comes walking in the door.
Voice. Hello.
Voice, Phil?
Voice. Yes.
Voice. IMelvin
Voice. Yes.
Voice. I just caught you by accident.
Voice. Uh-huh.
Voice. Listen, I'm curious about something. Couple of people have been talk-
ing to me about that article that appeared in the Florida Sun about the Club
Collins.
Voice. Yes.
Voice. According to the article in the Sun, you testified you saw gambling in
that place at some previous time.
Voice. That's right.
Voice. And that you went away and you came back and you attempted to make
the arrest on this particular night. How come you didn't make an arrest the
time you were there and saw them gambling?
Voice. All that I ever saw was poker and skin — that kind of games; that was
^ or 4 years ago.
Voice. This was a long time ago?
ORGANIZED CRIME IN INTERSTATE COMMERCE 215
Voice. Yes ; that's right. I noticed there was games of one sort and another
going on there all the time, and I tried to find if there is right now. But to get
in and find them, that's another question. You have to have search wai-rants and
everything else. There was a time, you know, we could go into tliose places,
knock down a door and go on in and there would he nothing said ahout it, but
nowadays they holler "illegal entry" and all that sort of thing, so you've got to
get a search warrant, I guess, to get into them.
Voice. Well, that place isn't 3 years old, is it?
Voice. Oh, that place has been there for 5 or 6 years, ever since that building
was remodeled ; when Ben Kaye had that place up there, when he first built it.
You remember when Ben Kaye built tliat building. That was at least 5 years ago.
Voice. Uh-huh.
Voice. How come an arrest wasn't made on that occasion, 3 years ago?
Voice. Well, I don't remember right now. They was playing what tliey called
short cards, which was permissible at that time. I went in there because I
understood there was a crap game running in there, and all that they were playing
was short cards, and short cards at that time was permissible.
Voice. What do you mean, "permissible"? Somebody said it was O. K.?
Voice. Well, they had an O. K. from somebody ; yes. I don't know who from,
but I was told not to, not to interfere with short card games.
Voice. Were you chief then?
Voice. No ; no, that was before ; before that time.
Voice. Who would give you orders like that? Where would you get them from?
Voice. Chief of police.
Voice. You don't know who he got them from?
Voice. No ; I don't.
Voice. Well, when you were chief who gave you orders about what should and
shouldn't be done, what could operate?
Voice. Melvin, I don't want to get involved here and get somebody in trouble
now.
Voice. Well, I'm trying to get to the bottom of this, and I have been trying for
a long time, and I don't care much who gets in trouble, as long as it's on the
level. I don't want to do anything dishonest.
Voice. Well, it always
Voice. I mean, I didn't call you up for the purpose or with the intention of
having this conversation with you that led into this. I would like to sit down
with you and discuss it with you at length.
Voice. Well, any time you're ready.
Voice. But I would like to know from you, if you can tell me, who was it that
gave you orders when you were chief? Somebody gave you orders, about who
was to operate and who wasn't to operate and when they were to operate and
when they weren't.
Voice. Well, as a rule it was Mr. Renshaw that they charged they interfered
with the hotels, and so forth, and were playing short cards and playing for the
entertainment of the guests and let the guests play cards in the hotel lobbies, and,
and I usually took my orders from him.
Voice. How about bookmaking?
Voice. Melvin, I would rather talk to you sometime when we're not on the
telephone about that.
Voice. All right. How about tomorrow?
Voice. Anytime you say .
Voice. Well, let me see, tomorrow is Thursday. Can you get away at lunch-
time?
Voice. Yes, sure.
Voice. How about stopping around my office about 12 o'clock, and I'll see you.
Voice. O. K., I'll do that.
Voice. Good. Good. Thank you.
• Voice. The foregoing was Phil Short, May 10, 1950, in the afternoon.
Mr. Halley. When did that conversation take pLace?
Mr. Richard. On May 10, 1950. I recorded the date right on the
machine, so I wouldn't forget the date.
Mr. Halley. Was that transcription an accurate report of the con-
versation ?
Mr. Richard. It was an accurate report.
68958— 50— pt. 1 15
216 ORGANIZED CRIME IN INTERSTATE; COMMERCE
Mr. Hallet. Did he mention in that telephone conversation the
name of the person who gave him orders when he was chief of police ?
Mr. KiCHARD. Yes. He said "Renshaw."
Mr. Hallet. Who is Renshaw ?
Mr. Richard. Renshaw is Claude N. Renshaw. He is the city
manager for the city of Miami Beach.
Mr. Halley. Did Short come to your office on the next day ?
Mr. Richard. He did, about 12 o'clock.
Mr. Hallet. And did you have a further conversation with him?
Mr. Richard. Yes ; I think I talked to Phil Short from about a half
hour to 40 minutes.
Mr. Hallet. Would you state the conversation to the committee?
Mr. Richard. I recall that I asked Phil Short whether it was pos-
sible to close down the city of Miami Beach without any difficulty,
and he said there would be no difficulty at all ; that the chief of police
could close the town in a matter of hours. And I asked him if that
was so, why he had never closed it down during the time he was chief.
He said while he was chief of police he closed it down on two occa-
sions.
I asked him what the occasions were. He said that one was author-
ized and one was unauthorized.
I asked him if he would tell me what these occasions were. He said
he closed the town immediately after he got into office, and he was
immediately advised by higher-ups to lay off.
He indicated that it was the city manager who called him and told
him that he didn't want the chief of police engaging in those activities.
He said that he subsequently closed the town again on orders from the
city manager.
I asked him how it was possible for him to close the town on that
occasion ; exactly what did he do.
He said he called Detective Pat Purdue, the one-man bookie detail
of the vice squad, and he told Pat Purdue to go out and close it down,
and he closed it down in a matter of hours.
I asked him how it was possible for Pat Purdue to accomplish that,
and he said all he had to do was to go out and tell the boys that the
"heat was on" and they closed up.
I asked him how come he thinks that Chief Simpson hasn't been able
to accomplish the job; that he has told me time and again that they
couldn't catch these fellows, and why is it that Pat Purdue finds it so
difficult catching people in the hotels, in bookie establishments, when
he was able to close the town, and he said he was an honest cop when
he was chief of police, and he knew that unless he followed orders that
he was going to lose his job ; that he thinks that City Manager Renshaw
is also an honest city manager, but in order to keep his job he realizes
he nmst do whatever four councilmen tell him to.
We talked further about the Club Collins raid at some length. He
gave me a detailed report on it. I don't know if it would serve any
useful purpose to the committee if I gave you the report. I can tell
you what happened in that raid.
Mr. Halley. Would you sununarize it?
Mr. RiciLVHD. He said he made tliis raid without the autliority of
the chief of police and without the knowledge of the chief of police;
that he took a group of men who were lower in rank than he was,
ORGANIZED CRIME! IN INTERSTATE COMMERCE 217
and ordered them to meet liim one nio:lit at the cTolf-drivin<»: rano;e on
Washington Avenue, near, well, it's near Dade Boulevard on Miami
Beach.
He said that the only policeman that he confided in was an officer
on the beat named Raskin, and he said the reason he confided in Raskin
was because Raskin was acquainted with the territory and was able
to advise him what should be done, and Raskin recommended that
the time of the raid should be in the vicinity of 11 o'clock at night;
that that was the time when most of the racketeers w^ere in the
vicinity.
He said he proceeded with these men at about that hour to the
Club Collins, and when he got there I said to him, "Did you take a
search warrant?"
He said, "No; I stopped at the city shop and picked up a sledge
hammer."
He said that the Club Collins had a solid-steel door and when he
got up to the elevator door the door was wide open. He said that
the i^eople wdiom he ordinarily expected to be hanging out there were
all gone, and there was a group of wdiat he thought to be "plants"
sitting in the various seats around the tables.
They were holding cards, but he said that from the fashion ir
wdiich they were holding them they obviously w^eren't playing any
particular game of cards. They were waiting for Phil Short and
party to arrive, and they were looking over their cards.
He came in there and there was nothing going on that would
w^arrant making an arrest.
]\Ir. Halley. Was there any further conversation about that matter ?
Mr. Richard. No; there VA^asn't. That is all he told me about the
Collins Club, the Club Collins raid.
Mr. Halley. What else did you talk with Phil Short about on
that occasion ?
Mr. Richard. I don't recall. There w^as a lot of small talk and
conversation, but basically what I w^as trying to find out from him
was who gave orders to keep the town closed and why it couldn't be
closed, and I think I have given you a good summary of that con-
versation.
Mr. Halley. Did you make a study of certain real-estate transac-
tions in the Miami Beach area?
Mr. Richard. Yes. It was about 4 or 5 years ago that I became
curious, because I observed in the newspapers that members of the
S. & G. Syndicate were purchasing a considerable amount of real
estate in the Indian Creek area, wdiat is commonly known at Miami
Beach as "Millionaires' Row," between Forty-fourth Street and
Fifty-ninth Street.
At that time we had a committee, the junior chamber of commerce,
that was created at my instance, a law-enforcement committee. I
proposed that this committee investigate the ownership of those par-
cels of land.
The committee worked with me for a period of time, and then
because I could give no reason for doing what I was doing — and I
had no reason at the time ; I didn't know what I was looking for — they
abandoned the project, and I proceeded to complete it myself.
I w^orked many hours at the courthouse, and finally developed the
titles to every piece of property in that Indian Creek area. After I
218 ORGANIZED CRIME IN INTEKSTATE, COMMERCE
had all the titles I didn't really know what to do with them. I was in
Mr. Ford's office one day. It's in the circuit court offices, the clerk's
office where the records are. I asked Mr. Ford if he had a book indi-
cating the places where the deeds are returned and, also, if he had a
book which would show me where tax bills are sent.
I realized that when an attorney closes a real-estate deal he custo-
marily has the deed returned to his office, and I was curious to know
who the attorney was, who might be representing the people in these
transactions.
He said he iiad such a book. I checked through it, and I found the
name of the attorney who was representing the members of the syndi-
cate who were purchasing property there, and I found some other in-
teresting information in the return of those tax bills to various people.
I be M eve I gave you a letter that T sent to Mr. Taylor.
Mr. Halley. How did you happen to write the letter ?
Mr. Richard. I wrote this letter to Robert Taylor in an effort to
take some action in connection with law enforcement.
Mr. Halley. Who is Mr. Taylor?
Mr. Richard. Mr. Taylor is the county solicitor for this area.
Mr. Halley. And under what circumstances did you write to him ?
Had you talked to him previously?
Mr. Richard. Yes. I talked to Mr. Taylor on several occasions on
the telephone. I attempted to make an appointment with him. On
one occasion I broke an appointment with him, and on another occasion
he told me he wasn't able to see me. We weren't able to get together.
I wrote the letter because I didn't really think that seeing Mr. Taylor
was going to accomplish anything. I thought perhaps a letter of this
kind, if published, would stimulate him to take some action on the law-
enforcement scene.
Mr. Haltj^.y. What is the date of the letter?
Mr. Richard. June 15, 1950.
Mr. Halley. Using the letter to refresh your recollection about the
real-estate transactions, will you go ahead and tell the committee
what you found ?
Mr. Richard. I might comment that one of the things that prompted
the letter was the activities of this committee, Senator Kef auver's com-
mittee. I made reference to it here, and particularly the action taken
by Mr. Hogan in New York.
I called attention to the fact that such action can be accomplished by
the prosecuting attorney if he wants to accomplish the job.
Tlie excerpt that I would like to read to you refers to this property
I cited in this letter :
I further recommend that you might possibly procure some valuable informa-
tion from your brother-in-law, Ben Sheparcl. who is the city attorney in the city
of Miami lieach. He has apparently had considerable dealin.sjis with the S. & G.
Syndicate members and might be able to give your office a great deal of valuable
information ccncerning their operations. To illustrate what I have reference
to, I quote from a portion of an instrument filed by me on May 30, 1947, in a
cause pend'ng in the circuit court of Dade County, Fla., in chancery No. 96153-F.
It should be borne in mind, in examining the quotation, that it is customary
practice, as you well know, for attorneys, in the representiition of clients pur-
chasing real estate, to have the deeds returned from the recording department
to their own offices.
The excerpt from the pleading referred to reads as follows:
ORGANIZED CRIME IN INTERSTATE. COMMERCE 219
Before I tell you that, people who own property in that area have
been seekinfT to have it rezoned through the courts.
It is significant to note that the fee-simple titles to many of the lots in that
area are vested in the names of members of the syndicate hereinabove referred
to and are vested in the names of persons who in some way are directly asso-
ciated with the city hall in IMiami Beach, Fla. Those fee-simple ownerships
are set forth in the fullowiiii;- list together with other significant information
showing to whom the original deeds were returned and to whom tax bills are
sent:
Amended plat, first ocean-front subdivision :
Lot No. 4, the fee-simple owner : Virginia Levitt and Samuel Fried-
man. The deed was returned to Ben Shepard, who, I explained, was
city attorne}'. The tax bills were sent to Virginia Levitt and Samuel
Friedman,
Lot. No. 5, the fee-simple owner : Harold Salvey. The deed was re-
turned to Ben Shepard. The tax bills were sent to Harold Salvey.
Lot No. 13, in the north half of lot 12, the fee-simple owners : Samuel
P. Cohen and Charles Friedman. The deed was returned to Samuel
Cohen in care of Sam Kay. The tax bills were sent to Samuel P.
Cohen and Charles Friedman, in care of Sam Kay.
Lot No. 14, the fee-simple owner: Ocean Front Apartments, Inc.
The deed was returned to J. N. Morris, and the tax bills were sent
to Ocean Front Apartments, Inc., in care of Sam Kay.
Lot No. 23, the fee-simple owner: Harold Salvey. The deed was
returned to Copeland, Therrel & Baisden. The tax bills were sent to
Harold Salvey.
Lot No. 24, the fee-simple owner: Charles Friedman and Jules
Levitt. The deed was returned to Copeland, Therrel & Baisden, and
the tax bills sent to Charles Friedman and Jules Levitt.
Lot No. 243, the fee-simple owner : Virginia Levitt. The deed was
returned to Virginia Levitt, and the tax bills were sent to Virginia
Levitt.
Lot No. 337, the fee-simple owner : Jules Levitt and Charles Fried-
man. The deed was returned to Ben Shepard. The tax bills were
sent to Jules Levitt and Charles Friedman.
The amended plat of the second ocean-front subdivision is an
area in the same stretch of ground also known as Millionaires' Row.
Lots Nos. 1 and 2, the fee-simple owner is William Burbridge, a
member of the city council. The deed was returned to Copeland,
Therrel & Baisden, and the tax bills were sent to Ben Shepard.
Lots 4, 5, and 6 : The fee-simple owner is the Ray Corp., and the
deed was returned to Copeland, Therrel & Baisden. The tax bills
were sent to William Burbridge.
The pleading went on to say :
It is significant to note that in the case of the members of the syndicate
the deeds in some instances were returned to Ben Sliepard ; that Ben Shepard is
the city attorney for the city of Miami Beach and is the attorney of record for
the city of Miam-i Beach, the defendant in this cause of action. It is further
significant to observe that Ray Corp., hereinabove mentioned, in its last report
filed with the Secretary of State of the State of Florida designated as its place
of business or domicile for service of process Il.SO Washington Avenue, Miami
Beach, Fla., which is the city hall at Miami Beach, Fla. ; that the officers of
the corporation
The Chairman. Wait iust a moment. The Ray Corp.: is that
R-a-y? ^ i '
220 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. KiciiARD. That is R-a-y, sir. Shall I proceed?
The Chairman. Go ahead.
Mr. EiciiARD (continuing to quote) :
that the officers of tlie coiiioration in the said last report were shown as Farber
Burbridge, president ; William Burbridge, secretary and treasurer, both in care
of Ben Shepard, attorney, City Hall, Miami, Beach, Fla., and the directors of
the corpoi-ation were shown as Farber Burbridge, William Burbridge, and Ben
Shepard, attorney, 1130 Washington Avenue, City Hall, Miami Beach 39, Fla. ;
that the said William Burbridge named as an officer and director of the said
corporation is a member of the Miam'i Beach City Council. With respect to
lots 13 and the north one-half of lot 12 of amended plat, first ocean-front sub-
division, aforesaid, the fee-simple owners, care of S. Kay, 420 Lincoln Road,
Miami Beach 39, Fla. ; that the said S. Kay owns considerable property as shown
hereinabove in the name of Sam Kay and is an officer and director in Ocean
Front Apartments, Inc., a Florida corporation, which latter corporation is fee
simple title holder of certain lots as shown hereinabove. Virginia Levitt is
the wife of Jules Levitt.
And that was the end of the pleading.
The Chairman. Mr. Richard, will you make a copy of this letter as
an exhibit to 3^our testimony and refer to it in any way you wish?
Mr. Richard. Do you want the entire letter?
The Chairman. Yes, sir.
(The letter referred to was marked "Exhibit No. 1"20"' and appears
in the appendix on p. 750.)
Mr. Halley. Would you explain whether there was a matter petid-
ing at that time involving an effort to re-zone certain parts of Miami
Beach ?
Mr. Richard. Yes. Several suits were pending, I believe. This
pleading that I filed was one that I filed in one of those suits and in
which I asked the circuit court to oust Mr. Ben Shepard as attorney
for the city of Miami Beach, on the grounds that he represented per-
sons who were interested in the re-zoning and apparently had an
interest of some kind himself, as shown by the deeds.
Mr. Halley. The re-zoning involved the property you have been
talking about ?
Mr. Richard. It involved property in that stretch, all of which is
estate property. That is the same property that Mr. Sullivan in his
testimony made reference to.
Mr. Halley. And the city of Miami Beach was opposed to the re-
zoning ?
Mr. Richard. Yes. The city of Miami Beach was defendant in the
case.
Mr. Halley. And the attorney for the city of Miami Beach was the
same Ben Shepard ; is that correct ?
Mr. Richard. Yes, he was.
Mr. Halley. The same one whom you find representing or at least,
depending upon the deed, the attorney representing some of these
cases, the attorney to whom the deed should be sent in these cases?
Mr. Richard. And as director, I believe, and officer of one of those
corporations.
The Chairman. AVliich corporation was that?
Mr. Richard. That was William Burbridge's corporation. That
was the Ray Corp.
The Chairman. AYhat business was tlie Ray Corp. engaged in ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 221
Mr. Richard. As far as I know — I don't know, really. I doubt if
it was in any business. It was probably created for the purpose of
holding this property.
Mr. Halley. After you were elected to the city council did you
have any discussions with Jules Levitt?
Mr. Richard. Jules Levitt talked to me prior to my election to the
city council and subsequent to my election to the city council.
Mr. Halley. Was there any discussion about your campaign ex-
penses 'i
Mr. Richard. Yes. Immediately after my campaign in which I
ran for the council, in 1947, Jules Levitt met me one day at the city
hall. There were some people present whom I did not know, and
I don't think he knew them either; they were strangers. (I say that
because since I have made reference to this story some man called me
some time ago and told me he was present and heard the remarks that
passed between us.)
Mr. Levitt told me that he had a lot of admiration for the campaign
I ran, that he thought I had done a good job. He said that I didn't
tell the truth when I stood on the lot and said that he had to hear me
when he came out of his home at night, that he came out at night and
stood in the shadows and listened to my speeches. He said the only
thing he resented was the fact that his sons had very fine grades at
college and he resented the things I said about their father.
He said I would be the next mayor of Miami Beach, and that he and
the S. & G. Syndicate would support me handsomely.
. He told me that he was going to make the first contribution to my
next campaign and that he would give me personally out of his pocket
the total amount that I had spent on my campaign for office that year,
1947.
He asked me how much I had spent. I told him, "At least $2,500."
He said that the first contribution to my campaign would be $2,500
and the S. & G. Syndicate would support me in addition to that.
He told me that he had confidence in me and was willing to take
me around and show me the entire syndicate operations, that he would
show me their main office and branch offices, that he would show me
how it operated and that he would convince me that they were an
important asset to the community, that they served to keep out a lot
of the ^I'ew York racketeers who would otherwise be in the areas not
controlled by the local boys.
He told me that I w^as tired and ought to go on a vacation. He
recommended that I visit a farm that he had in North Carolina. He
said that he would arrange to have plane tickets for me. I told him I
couldn't possibly consider leaving the city of Miami Beach because
I had spent 30 to 40 days in my campaign and I hadn't practiced law,
and I had nothing to make a living by.
He told me that in North Carolina I would earn legitimately in my
practice of law as much as I would have earned had I remained here.
I told him that I had a wife and two children and couldn't afford
to leave. He said that plane tickets would be available for my entire
family, and we could stay as long as we liked. He said there was a
lake there and horses and we would have a wonderful time.
I rejected his invitation.
'Mr. Halley. Was there any further discussion about how you would
not lose money while you were away on vacation ?
222 ORGANIZED CRIME IN INTEKSTATEi COMMERCE
Mr, Richard. He said that in my law practice I would earn as much
money as I would have earned had I been in the oiRce practicing law.
I did not engage in any discussion with him as to how this was to be
accomplished.
Mr. Halley, Was there any discussion as to the possibility of mak-
ing profitable business transactions?
Mr. Richard. No. I think in a conversation with 3'ou I mentioned
that, but Jules Levitt was not the man who made that reference to me.
I did have a conversation with Jules Levitt on two other occasions.
On one occasion I met him in front of the city hall. I had been
pushing for some four- wall handball courts in Flamingo Park, and I
tried to get the council to put them in. I had played handball in the
Navy, and I thought it was a game that would interest a lot of the
citizens of the community. All of the members of the council appar-
ently were reluctant to do it and consequently they paid little, if any,
attention to my request. I met him in front of the city hall and we
discussed something about some four- wall handball courts in Flamingo
Park. I told him that I merely had mentioned it to the city council,
telling them that I thought four or five thousand dollars would be
adequate for that purpose, and he said, "I think it is a good idea and I
will help you." I said, "How can you help me," and he said, "I will
do what I can." So the next time the city council met it was taken up
and apparently without any request from anybody — I don't know
whether Jules Levitt had any influence in accomplishing it or not,
but I do know that they appropriated a considerable amount of money,
something like $32,000, and they built very elaborate four-wall hand-
ball courts in Flamingo Park. They were built of solid concrete
walls, concrete block with glass in them and very fancy outside ; they
are very beautiful courts and they have served the city very well.
Mr. Halley. Mr. Jules Levitt is a member of the S. & G. Syndicate?
Mr. Richard. So I understand. He did call me on one occasion
after my election, I am pretty sure that it was subsequent to my elec-
tion, and he merely askecl me if I would be willing to handle the real-
estate business of the members of the syndicate. He said that they
had considerable real-estate business from time to time, and he wanted
to know if I would be willing to handle it and that it would be strictly
on the level. I told him that I was reluctant to say that I would be will-
ing to handle it. I hung up and I thought about it for a little while
and got to wondering who I could discuss the matter with. I finally
did call one of the top-ranking newspapermen here and I asked him
what his impression was. I called John Pennekamp of the Miami
Herald, and he said that it was just an effort by them to get my name
on a check, and that it would be very foolish for me to become involved
with them in any way. I never did any real-estate work for them.
Mr. Halley. Did you ever do any work for Jides Levitt or Leo
Levitt, Ben Colien or Sam Cohen or any of the members of the S. & G.
Syndicate ? Did you ever receive any compensation from any of them ?
INTr. Richard. No, sir.
Mr. Halley. Did they ever support you in your election campaigns?
Mr. RicriARD. No, sir. All of the money that we took was very
carefully examined and every contribution went into a bank account
and all moneys were pxpended by check.
The Chairman. You turned down that offer that was made to ycrii ?
Mr. Richard. Yes.
ORGANIZED CRIME IN INTERSTATE COMMERCE 223
]\Ir. Hatxet. Did you ever have a conversation with Ben Cohen
about tlie S. & G. Syndicate ?
Mr. Richard. Yes, I did. It was in what is now the Piado Restau-
rant, but at that time it was called Murray's. I cannot place the date.
1 don't know whether it was prior to the election or after the election,
but I am sure Mr. Cohen remembers. I went in the restaurant and
sat down alone for lunch, and in a few minutes later, by accident pos-
sil)ly, Mr. Snedi^ar, who was a city councilman at one time and who
is now a member of the county commission, walked in and saw me
at the table and asked to sit down and have lunch with me. I said
I had no objection. A few minutes later Ben Cohen walked in and
he asked me the same question and he sat down at the table, too. I had
never seen either of these men in this place before, althoug;h I had
been eating there regridarly because the place was immediately across
the street from my office.
After we sat there for a few minutes Mr. Cohen opened the con-
versation with a casual reference to the S. & G. boys. He told me
that if I fTot to know them I would realize that they are fine boys, fine
fellows and "that they are the type of people you would be proud to
have in your home."
We g-ot into a lengthy discussion and I told him that "they are
I am sure very nice and fine fellows but they belong in jail because
they are violating the law." I told him that in the course of my
experience I had met some very fine people who were in jail for
committing crimes and that they were very nice people to talk to. We
continued talking back and fortli and the argument got considerably
heated and we didn't get along well. The session finally ended and
we walked out to the curb, out on the sidewalk, and we continued
arguing. I realized that I was arguing with Mr. Cohen in front
of people who were passing along on the public street and that it
was very foolish, so I stopped. I thought it was foolish for me to con-
tinue such discussion with him out there on the public street. I said,
"Ben Cohen, you are part and parcel in this thing; you are a part
of the S. & G.", and Bennie got mad and pointed his finger at me and
said, "Don't let me hear you say that again. I am not part and parcel
of the S. & G. Syndicate. I am an attorney and I practice law and
I have a right to represent whoever I please," and I said, "Bennie,
I am surprised because only 30 minutes ago you told me that these
men were people that I would be proud to have in my home."
Mr. Halley. Did you ever check up and find out if Ben Cohen ever
represented himself as a part of the S. & G. in connection with their
business, other than to represent them as counsel ?
]Mr. Richard. Yes. I have documentary evidence that he has repre-
sented himself to be the attorney for the S. & G. Syndicate.
]Mr. Halley. What is that documentary evidence ?
Mr. Richard. The S. & G. Syndicate, after the local newspapers
reported in 1949 that they had offices but no license, went down and
took out a license or licenses, and these are photostatic copies of city
licenses. ' This one here is for 1947-48 license, S. & G. Investment
Co., 422 Lincoln Road. The manager is given on tlie license as Leo
Levitt and the business is given as investments.
The 1948-49 license is the same thing with the manager again given
as Leo Levitt.
224 ORGANIZED CRIME IN INTERSTATE COMMERCE
The 1949-50 license is of the same type, with the names shown as
Sam Friedman and Leo Levitt.
This document is a photostatic copy of a card attached to the
application for the original license in 1947 which was signed Leo
Levitt, by Ben Cohen, attorney. It is an application of the S. & G.
and on the reverse side it was sworn to by Ben Cohen before a notary
public, in which he states that the contents on the reverse is true.
The Chairman. Let these be filed as an exhibit to your testimony.
(Photostats of 1947-48, 1948-49, and 1949-50 licenses were marked
"Exhibit Nos. 121, 122, and 123," respectively. Photostat of card re-
ferred to was marked "Exhibit No. 124." These exhibits appear in the
appendix on pp. 753-754.)
Mr. Halley. Was there a suggestion made before the City Council
of Miami Beach recently that the city hall be moved ?
Mr. Richard. No. There was a letter read by the city clerk. We
had been looking for additional space because the city hall is not
quite large enough to accommodate our offices. The city clerk read
a letter from some person who wasn't named, but in the letter it was
stated that space was available on an entire floor of a building which
could be used for operations of the city hall. This letter concerned
the rental of this space by the city. I asked what the address was
and he said Fourteenth Street and Washington Avenue, and I
inquired around and found that it w^as Harry Salvey's building. I
said tliat I was very much surprised that they would attempt to
move the city hall right into their own property.
Mr. Halley. Who is Harry Salvey 'i
Mr. Richard. He is reputed to be a member of the S. & G. Syndicate.
Mr. Halley. Is there anything else you would like to say to the
committee ?
Mr. Richard. I feel very strongly about the situation that exists
here. I think we have to do a big job locally. I think this commit-
tee is doing a splendid job and I think the crime commission should
be commended for the wonderful job it has done, but I think the juris-
diction of this committee is not going to reach far enough because of
its inability to go into the local situation completely and fully. I
think we need principally a program of education of the people and
thus avoid this propaganda that has been going on over there l)v these
public relations men of this gambling syndicate to the effect that
gambling is essential to the economy of the city, which is a pretty
tough thing to overcome.
The Chairman. How old are you, Mr. Richard ?
Mr. Richard. Thirty-eight.
The Chairman. Where did you go to school ?
Mr. Richard. I went to school at the New York University and
the Florida University.
The Chairman. Where were you born?
Mr. Richard. I was boi-n in Brooklyn, N. Y.
The Chairman. Did you serve in the Navy ?
Mr. Richard. I was in the Navy 21/2 years.
The Chairman. How long have you practiced law at Miami Beach?
Mr. Richard. Since 1934, with the exception of the time I was in the
Navy.
The Chairman. As I understand it, Mr. Richard, you lost your
1947 campaign?
ORGANIZED CRIME IN INTERSTATE COMMERCE 225
Mr. Richard. Yes, I did.
The Chairman. You won in 1949 ?
Mr. EicHARD. Yes, sir.
The Chairman. Did the opposition of the S. & G. and criminal
elements of Miami Beach defeat you in 1947?
Mr, Richard. Yes. I ran a campaign similar to the one I ran in
1947. Contributions came to the amount of almost $5,000 and we
had a campaign headquarters, which in that respect was different
from the first campaign.
The Chairman. Did you win ?
Mr. Richard. Yes,
The Chairman. And you didn't have them on your side ?
Mr. Richard. No, sir.
The Chairman. Did you get a good majority?
Mr. Richard. Yes. I earned a 4-year term.
The Chairman. So the idea that one cannot be elected without
their help and support has been disproven?
Mr. Richard. Yes, but it was a tough job.
The Chairman, Was there any recall petition brought against
you?
Mr. Richard. Yes, there is a recall petition pending now to oust me
from office, and that litigation is pending in the Supreme Court of
Florida at the present time, to throw out the recall.
The Chairman. Who sponsored the recall ?
Mr. Richard. The recall was sponsored by a group of people headed
presumably by a man by the name of Harry Plissner, but I have rea-
son to believe that the man who was really the front man is a man by
the name of Charles Gunches who has since been arrested by the FBI
and is being held in California.
The Chairman. What was he arrested for?
Mr. Richard. On some kind of an embezzlement charge. Accord-
ing to the newspaper article he said that he spent the money betting
on horses and baseball games.
The Chairman. He was the chief sponsor of the recall petition ?
Mr. Richard. That is what I have been told, Plissner, who was
in the front of this recall movement, has been indicted by the grand
jury.
The Chairman, In your opinion was the S. & G. back of the recall
petition ?
Mr. Richard. It is my opinion that they supported it, and I estimate
that $150,000 was spent on the recall.
Tlie Chairman. What charge did they place against you in the
recall petition?
Mr. Richard. The charge was that I pursued activities that were
inimical to the best interests of Miami Beach and its citizens, but they
didn't say which citizens.
The Chairman. What activities were they?
Mr. Richard. They didn't name any activities. That was the only
charge in the recall affidavit.
The Chairman. Who is Mr. Plissner?
Mr. Richard. Plissner is a man who was active in my campaign and
who helped me considerably. Since the election he has been indicted
by the grand jury on a bribery charge. The bribery charge was
thrown out by Judge Holt on the ground that I was the man who was
226 ORGANIZED CfRIME IN INTElRSTATEi COMMERCE
supposed to have been bribed, and Judge Holt said that I could not
have been bribed because what I was supposed to be bribed for I
couldn't do. That case is now before the supreme court.
The Chairman. What was the connection of Plissner in that case?
Mr. Richard. He is the defendant.
The Chairman. Tell us more about the story of your relationship
with Mr. Plissner.
Mr. Richard. I met Mr. Plissner as a member of the junior chamber
of commerce. He is not a man that you would expect to be in the
chamber of commerce, the junior chamber of commerce, because he is
much older than the age limit. I would guess that he is about 55.
He appeared at the junior chamber of commerce one night and got up
on the floor and complained about some specific matter, and, as usual
and customary in organizations of this type, the president of the
organization named him as a committee of one to go out and do some-
thing about it. Nobody expected to hear from him again.
At the next meeting, toward the end of the meeting, he got up and
complained about the fact that he had been appointed a committee of
one to do a certain thing and that he had not been called upon to report.
He got up and made an excellent report, plainly showing that he had
done much work and had accomplished some good for the organiza-
tion. He was retired and apparently had nothing to do and was
apparently willing to give all of his time to civic activities. He showed
a real interest in me and my activities and showed a real desire to help
me in my civic endeavors for the benefit of Miami Beach.
The Chairman. He was interested in civic activities and he sup-
ported you in your election?
Mr. Richard. Very actively.
The Chairman. Then what happened?
Mr. Richard. After the election he showed considerable tempera-
ment. He became angry because I wanted to talk to people on the
street and because I wanted to return about a thousand telephone calls
that came in during the first 2 weeks after my election. He said that
he should handle the business for me, that a politician should have
someone to handle things for him. We had some very terrific argu-
ments during the first 2 weeks after the election. He told me that I
would have to make deals. He said that if I wanted to accomplish
any of my campaign promises that I would have to have a go-between,
and he said that the best man would be Will Burbridge because he
had had considerable experience and knew his way around, and I told
him that I would not do anything of the kind. He finally worked
himself up to the point where he suggested deals. I want you to
know that this happened over a period of 2 weeks ; it ha]:)pened every
night at my home and every day in my office. This final proposition
that he made to me was one where he came to me and told me that
I had to hear him out and let him finish without my saying anything.
He said that the arrangement was to permit the S and G syndicate to
run without any effort on my part to stop them ; he said that he realized
that the newspa]:)ers woidd condemn me for it and for not keeping my
campaign promises.
He told me that there would be no objection to my getting up in
the council meetings and denouncing the S and G and tlie racketeers;
and I coukl go to the chief of police publicly and condemn him; that
I coukl go to the city manager publicly and condemn him, but that
ORGANIZED CRIME IN INTERSTATE COMMERCE 227
I could not do it privately, but that if I did it publicly they would
understand the reason for it. He said that I could also arrange raids
to be staged in scout cars, that I could have the photographers there
and that j^ictures would be taken and that important people would
be arrested. He said that it was none of my business what happened
after the arrests were made. He said that if I did these things the
people would say that I had done my duty. He said that I could even
condemn the prosecuting officers for failing to do their duty.
The final deal he made to me was that he was going to handle the
punchboard deal in the city of Miami Beach and that one-fifth of
any income would be paid to me. He said that it would be paid to
me through legitimate channels. He said that he would make arrange-
ments so that nobody could ever prove that any of this money was
paid to me.
The Chairman. Who said that ?
Mr. KiCHARD. Plissner. He said that he had made these arrange-
ments and that if I went along I could probably stay in the city
council forever because they controlled the votes and the people would
think that I had done my duty in accordance with my campaign
j)romises and so forth.
The Chairman. What did you do about it?
Mr. Richard. I had a very vicious argument with him, and he left
on that occasion very angry. I think I had better tell you the rest
of the story.
The Chairman. Yes, go ahead and tell us.
Mr. Richard. Well, I knew Mr. Plissner quite well and we were
still friendly, and I told Mr. Plissner I was very much concerned with
the difficulties I was running up against and that I didn't know my
way around politically; that I didn't know in what direction to go
or in what course I should go, and I didn't know who to talk to and
I didn't know who to trust and that I didn't know really how to stop
this gang situation on Miami Beach.
I had talked to Mr. Renshaw in the early part of my career after
I got elected and he assured me that one man could stop the gang
operation, one councilman, but I didn't — he didn't tell me how and
I was ashamed to ask him. I wanted him to thing I knew how.
I told him that under the circumstances I would like to consult with
the people who would best aid me in a campaign of this type, and I
told him that I thought the people to help me best were the people who
helped me get elected, and I proposed to call them together if I could
get them — the heads of the two newspapers that supported me — the
Miami Daily News and the Miami Herald, and although at that time
the Florida Sun had not supported me, I said in all fairness I wanted
to call them in, too. I wanted to present the problem to them not for
the purpose of publicity, but to get them to advise me on what am I
to do. They created something and I wanted some help to tell me how
to go about ending this situation on the Beach that was bad.
Well, before I realized it, they were willing to meet at my office
and with some trepidation I called Mr. Pennekamp and I called Mr.
Mahoney and Mr. Storer and I offered to meet with them any place
they wanted at their convenience and it was they who suggested that
they would be more than willing to meet at my office and they said nc>
such meeting had ever taken place before. This meeting was sched-
uled for a specific date, but before that date I had this fight with
228 ORGANIZED CRIME IN INTERSTATE: COMMERCE
Plissner and we weren't talking. We had a meeting at the city hall
the day that this meeting was scheduled to take place at 2 o'clock
in the afternoon.
I left the city hall. I believe the meeting was a tax equalization
board meeting, I am not certain. I left the city hall and went across
the street to a little restaurant to get something to eat, and Plissner,
who had been in the city council chamber, followed me across and
sat down at the table. He asked me if I had any objection to his
eating there and I told him I had no objection ; that it was a restaurant
and that he had a right to eat there if he wanted to and we engaged in
small talk.
I kept taking my watch out and jQnally he asked me why I was look-
ing at my watch and I told him that I might as well tell him that
that meeting that I had arranged for was scheduled for that date at
2 o'clock, and I told him no, I didn't intend to invite him to the
meeting, but the more I think about it, the more I think it is a good
idea. I said, "I am going to tell these men exactly what I have to
contend with." I said, "I am going to tell them about people like you
and what you are asking me to do."
I said, "I am going to tell them, without naming you, that I can't
get anywhere with any civic project; that I am just going to be a
bump on a log in a city council and I am going to tell them the prob-
lems that I have and I am going to ask them to answer me," and I
said, "If you want to come along, I will put you on the spot and you
can discuss the matter with them yourself." He said he would be
glad to come.
He came to the meeting, and the men attended. Each of the men
brought men from the editorial staff with them. Mr. Storer did
not attend. He sent two men from his newspaper. I presented this
story and I turned it over to Plissner without saying that he was the
man who had made these proposals, and the argument that ensued
lasted, I think, for about 2 hours. It was a very vicious argument
between Mr. Plissner, Mr. Pennekamp and Mr. Mahoney largely.
When the meeting was over they went away and Mr. Plissner stayed
behind. He got quite hysterical in the office and he told me that the
newspapers were seeking nothing more than headlines; that as long
as they could use me they would, and that I was a damn fool to go
along with them ; that they would just as quickly break me as carry
me; and that I owed it to him — that he elected me and it was my
obligation to see that he got the punchboard deal or some other
income.
He suggested what I might do for him and he got so hysterical
that he shouted something about his sister-in-law needing money, that
she was in the hospital, and I told him that that was ridiculous ; that
he was a retired man with a big home and that he had property in this
area, and I finally didn't know how to get rid of him and I told him
I had to leave the office and I turned down the lights and walked out
and he followed me down the street and when we got to the street
I told him I didn't think we thought alike and I didn't want to see him
any more and I left, and the next day a friend of mine called me and
told me that he had been over to this friend and told this friend that
I had dismissed him from my service.
The Chairman. When did the recall petition start after that?
ORGANIZED CRIME IN INTERSTATE: COMMERCE 229
Mr. Richard. I don't know exactly how long, but I think the re-
call petition was started about 6 or 7 months after my election.
The Chairman. How about the indictment? Tell how that got
started. Make it as brief as you can.
Mr, Richard. There is a reporter, I believe, in the courtroom w^ho
came from the St. Louis Post-Dispatch. As a matter of fact, I
have mentioned this story numerous times before organizations with-
out mentioning Mr. Plissner and I mentioned it on some radio broad-
casts and nobody paid much attention to it.
The reporter from the St. Louis Post-Dispatch came to my office
and asked me some questions. He published the story and it was car-
ried in the local papers, and Plissner took it up there — took it up from
there and commenced denying that he was the man who had made
the bribe offer. I never named him. He started this denial. He
went on the air and went before organizations and gave statements
to the press. He commenced a general denial. That is how the thing
grew up.
The Chairman. What happened after that?
Mr. Richard. Demands were made I name the man and demands
were made by a radio commentator who had harangued immediately
after that that some action be taken and finally I offered Mr. Mincer,
who is the State attorney, that if I were asked to discuss anything
with the grand jury, I was prepared to come in and tell my story any
time they wanted to hear it. They sent for me. I talked to them
and as a result of that talk an indictment was issued.
The Chairman. And the indictment charged him with what?
What was the charge ?
Mr. Richard. It charged him with attempted bribery. I don't
know. The indictment, according to the newspapers, had some other
reference. I never have seen the indictment.
The Chairman. You mean some radio station harangued about that
incident?
Mr. Richard. Yes; and they regularly played some recordings of
harangues of a slanderous character.
The Chairman, Wliat person on the radio ?
Mr. Richard. Barry Gray.
The Chairman, What station was that?
Mr, Richard. WMIE.
The Chairman. Who is the owner of that station ?
Mr. Richard, I understand the station is owned by a man named
McBride, and I believe his son is the owner of the Continental Press
Service,
The Chairman. Do you know whether an application is now pend-
ing for additional service or additional strength for that station by
Mr, McBride?
Mr. Richard, Yes. I talked to Mr. Becker while he was here,
who was one of the attorneys for the Federal Communications Com-
mission, and there was a hearing conducted here in which an applica-
tion was made for, I believe, a permanent franchise or a permanent
permit. I don't believe they have a permanent permit.
Senator Hunt. What are the station's call letters?
Mr. Richard. WMIE.
The Chairman. And they are now trying to void or throw out the
indictment on the ground that what they charged that he tried to
bribe you to do was not in your power to do ; is that correct ?
230 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Richard. Yes, sir. Senator, I would like to make a comment.
I have some very extensive wire recordings. I have mentioned this
to Mr. Halley. They are w^ire recordings which indicate — they don't
indicate — they state that attempts were made to, by threat and other-
wise, procure witnesses to testify in behalf of Plissner. The recordings
make it quite clear that the people who are making these demands
now are making the statement that w^hat Plissner said was untrue.
I told Mr. Halley that the recordings were so long, that they involve
so many conversations that it would be a difficult thing to produce
here.
The Chairman. Well, we will analyze them and use them in such
manner as we think will suit the purpose of this inquiry.
Now, you mentioned the proposal for a punchboard deal that Mr.
Plissner made of you; that he and two or three people would have
control of the punchboards on Miami Beach; is that correct?
Mr. Richard. Yes. He said three people and he said that the net
income
Tlie Chairman. Wlio were those three people ?
Mr. Richard. He never mentioned any. He never mentioned the
man who was going to accomplish this.
The Chairman. What did he say the net income would be?
Mr. Richard. He estimated it at $750,000 a year.
The Chairman. A year ?
Mr. Richard. Yes, sir.
The Chairman. $750,000?
Mr. Richard. He said they could be placed in all of the hotels and
all of the drug stores and all stores throughout the city and they could
realize an income of $750,000 a year.
The Chairman. Are there any questions. Senator Hunt ?
Senator Hunt. No, sir.
The Chairman. Mr. Richard, this is a very interesting story you
have given us, one in which I expect you will find counterparts in a
great many places in the United States.
As far as the chairman of this committee is concerned — and I am
sure that Senator Hunt joins me — we are glad to see that you have
stood up against the assaults that have been made and we wish there
were more people who would stand up like you.
Mr. Richard. Thank you, sir.
The Chairman. That is all.
The Chairman. Mr. H. G. Taylor ? Will 3^ou come around ?
TESTIMONY OF HARRY G. TAYLOR, ATTORNEY
The Chairman. Do you solemnly swear that the testimony that you
will give this committee will be the whole truth and nothing but the
truth, so help you God ?
Mr. Taylor. I do.
The Chairman. All right, Mr. Halley.
Mr. Halley. Mr. Taylor, what is your occupation ?
Mr. Taylor. Attorney at law.
Mr. Halley. And where is your office?
Mr. Taylor. 807 DuPont Building.
Mr. Halley. Miami?
Mr. Taylor. Yes, sir.
ORGANIZED CKIME IN INTEKSTATE COMMERCE 231
Mr. Halley. Were yon served with a siibpeiia by this committee
to produce certain records?
Mr. Taylor. Yes, sir.
Mr. Halley. Have you produced those records?
Mr. Taylor. Yes, sir.
Mr. Halley. What records have you produced pursuant to this com-
mittee's subpena ?
Mr. Taylor. What I have ; everythino; I have got.
Mr. Halley. Woukl yon physically present them to the committee
and describe what you have?
Mr. Taylor. I gave to your investigator a synopsis of all the files
I have, and they are my personal files. No records of individuals are
represented at all. They are office files and correspondence.
Mr. Halley. You do not have the original records ; is that right ?
Mr. Taylor. That is right.
Mr. Halley. You do have office files based on those records ?
Mr. Taylor. That is right.
Mr. Halley. And you have produced them ?
Mr. Taylor. That "is right.
Mr. Halley. You have with you a copy of a summary ; is that cor-
rect?
Mr. Taylor. That is correct.
Mr. Halley. May that copy be offered in evidence to save the com-
mittee's time ?
Mr. Taylor. This is my retained copy. The investigator has the
original and three copies.
The Chairman. We will file a copy that Mr. Keily has.
Mr. Halley. Now, would you introduce into evidence those files?
The committee will attempt to return them to you within a very
short time, but the committee would like to inspect them.
Mr. Taylor. I would like to announce to the committee that this is
a matter with which we are concerned here. It is one of asserted
Federal taxes and it involves possibly a criminal proceeding. That
is the only interest I have in the S. & G. Syndicate or anything con-
cerning the S. & G.
We are scheduled for a conference in Washington very shortly with
respect to that. We have been preparing intensively for that con-
ference. The removal of these records and so on, not mine in particu-
lar, but many of the others, will handicap us terribly in the preparation
for that conference.
Mr. Halley. I do not believe that the committee would want to
handicap you in your work, and I do not believe that the committee's
perusal of the records would take over 24 hours. However, it might
take a day or so longer. But the records will be reviewed and returned
to you.
The Chairman. Mr. Taylor, what time tomorrow or the next day
will you need the records? We want to cooperate with you in that
matter and we appreciate the problem you have.
Mr. Taylor. If the records could be returned to me by Saturday
The Chairman. The records will be returned to you by Saturday at
II o'clock.
Mr. Halley". And the list of items will be your receipt.
The Chairman. Thank you, Mr. Taylor, for your cooperation. That
is all.
68958—50 — pt. 1 16
232 ORGANIZED ORIME IN INTERSTATE COMMERCE
Mr. Halley. I offer in evidence as exhibit No. 125 the records sub-
mitted by Mr. Taylor and identified pursuant to the memorandum
which will be submitted by Mr. Kiely.
The Chairman. They will be received and made a part of the record
as exhibit No. 125. The original records must be returned to Mr.
Taylor at 11 o'clock Saturday. ( Summary of records referred to was
marked "Exhibit No. 125," and is on file with committee.)
Mr. Halley. Thank you.
The Chairman. It is quite apparent that from the very important
but slow progress that w^e are making we are going to have to speed
up considerably if we are to get back to Washington at any time in the
near future. I think the committee had better meet at 9 o'clock in the
morning instead of 10 and we will only take 45 minutes for lunch
tomorrow noon, and go on perhaps later tomorrow afternoon than we
have today.
The w^itnesses who have been subpenaed will remain in attendance,
unless you want to speak with Mr. Halley or some member of the
staff about the time that you might be needed back here. Perhaps it
is possible to dispense with quite a number of witnesses until tomorrow
afternoon, or perhaps until late tomorrow afternoon, if you have other
engagements that you need to make.
If any witnesses are in a position where they must get away tomor-
row afternoon for some important personal or business matters which
require them to leave at an earlier time, they will also speak to the
counsel or to the staff and we will try to accommodate them in their
problems.
With that the committee will stand in recess until 9 o'clock in the
morning.
(Whereupon, at 6:15, the committee recessed until the following
morning. )
INVESTIGATION OF OKGANIZED CKIME IN INTEESTATE
COMMERCE
FRIDAY, JULY 14, 1950
United States Senate,
Speciai/ Committee To Investigate
Organized Crime in Interstate Commerce,
Miami, Fla.
The committee met, pursuant to recess, at 9 : 27 a. m., in the United
States District Court, Miami, Fla., Senator Estes Kefauver, chair-
man, presiding.
The Chairman. The committee will come to order. The chairman
would like to inquire in the beginning whether any of the 10 witnesses
that we have been trying to get to appear before the committee and
upon whom we have been endeavoring to serve subpenas, have ap-
peared this morning. If so, we would like to know, so that we can
arrange our schedule and also determine whether or not we will have
to rely upon secondary evidence in this hearing to prove some things
that we would like to prove otherwise by more direct testimony.
Sam Cohen. Mr. Cohen, I believe, is in the hospital and had an
operation; is that correct?
Mr. Halley. Yes.
The Chairman. So that he is accounted for. Harold Salvey. Did
Mr. Salvey appear?
(No response.)
The Chairman. Charles Friedman.
(No response.)
The Chairman. Eddie Rosenbaum.
(No response.)
The Chairman. Jules Levitt.
(No response.)
The Chairman. William H. Johnston.
(No response.)
The Chairman. John Patton.
(No response.)
The Chairman. Jack Friedlander.
(No response.)
The Chairman. Harry Russell.
(No response.)
The Chairman. George L. Bowers.
(No response.)
The Chairman. Apparently none of these 10 witnesses are present.
The Chair might remind them, in case they got the message, tliat they
are not accomplishing anything by failing to appear here at this hear-
233
234 ORGANIZED OEIME IN INTERSTATE COMMERCE
ing ; that is, they are not accomplishing anything for their permanent
betterment.
I believe Mr. Furman has answered a subpena and has certain
records that he wants identified.
Mr. Furman, will you come forward ?
TESTIMONY OF M. G. FURMAN, ACCOUNTANT
The Chairman. Mr. Furman, do you solemnly swear that the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God ?
Mr. Furman. I do.
Mr. Hallet. Mr. Furman, were you served with a subpena?
Mr. Furman. That is right,
Mr. Halley. Pursuant to the subpena have you produced certain
records ?
Mr, Furman. All of the records I have in my possession.
Mr. Halley. Will you state what records you have in your
possession ?
Mr. Furman. A mass of detail pertaining to personal records of
Harold Salvey and other working data which I am preparing in my
capacity as an accountant retained by the attorneys for Mr. Salvey
in connection with a case, an income-tax case, now pending before
the General Counsel's Office of the Bureau of Internal Revenue, Wash-
ington, D. C.
Mr. Halley. Will you describe more particularly what these records
are ; what do they cover ?
Mr. Furman. They cover the years starting January 1, 1945, and
through to date. I have the detail through 1949 and 1950, I believe,
Mr. Halley, Will you now present the records to the committee?
Would you like to turn them over in the brief cases or would you pre-
fer to keep the brief cases ?
Mr. Furman. No. I would just as soon turn them over that way,
so I can get them back intact. They are arranged in a certain order.
Mr. Halley. Will you take each brief case and describe the
contents ?
Mr. Furman. I can tell you generally, because there is an awful
lot of stuff there.
Mr. Halley. State it generally, but be complete.
Mr. FuKMAN. There are tax returns there, copies; there are bank
checks, bank statements ; there are various instruments of ownership
of property, mortgages, records of tax paid, and so forth.
Mr, Halley. I offer in evidence the miscellaneous files produced
by Mr. Furman relating to Harold Salvey and related tax cases.
The CiiAiRiNiAN. They will be received and made a part of the record.
(The files referred to were marked "Exhibit No. 126," and were later
returned to witness.) Now, the chairman understands, Mr. Furman,
that you need these records in connection with work that you are
doing.
Mr. Furman. Yes, sir.
The Chairman. We will undertake to see that they are returned
to you as soon as possible, and I think it will be before th« committee
leaves Miami.
OKGANIZED CRIME' IN INTERSTATE^ COMMERCE 235
Mr. Hali.ey. Do you have any other records of this S. & G. Syndi-
cate in your possession ?
]Mr. FiTiisrAN. At one time I had certain general records of th6
syndicate in my possession wlien I was working with Mr. Bowden, an
attorney, and also Mr. Taylor.
Mr. I Ialley. Up to what period did you have those records ?
]\Ir. FuRMAisr. I have hacl them oiT and on until a few weeks ago —
lip until last Thursday or Friday when I finished the date I was pre-
paring for INIr. Bowden. Then I returned the records, and I gave
my data to INIr. Bowden, the attorney.
Mr. Halley. Will you state to whom you gave the records ?
Mr. Furman. To Mr. George K. Bowden, an attorney at law of
Washington, D. C.
Mr. Halley. Did you return them to him in Washington or here?
Mr. FuRMAN. I gave him the results of the various inquiries he
requested me to make.
Mr. Halley. AVhat did you do with the records ?
Mr. FuKMAN. The records themselves, sir, I arranged for the S.
& G. man to pick up.
Mr. Halley. What was the name of the S. & G. man who picked up
the records ?
Mr. FuRMAx. I think Leo Levitt picked them up.
Mr. Halley. When did Leo Levitt pick them up ?
Mr. FuRMAN. Either Thursday or Friday.
Mr. Halley. Of last week ?
Mr. FuRMAN. Of last week.
Mr. Halley. That was a week ago yesterday, or a week ago today ?
Mr. FuRMAN. That is correct.
Mr. Halley. Where did he pick up those records ?
Mr. FuRMAN. He picked them up from my office when I finished
with them.
]\Ir. Halley. Do you know where Leo Levitt is today?
Mr. FuRMAN. I do not.
Mr. Halley. When did you last see Leo Levitt?
Mr. FuRMAN. Maybe Thursday or Friday.
Mr. Halley. Will you please be more definite ? When did you last
see Leo Levitt?
Mr. FuR:\rAX. I finished the records on either Thursday or Friday.
I left word in my office for them to contact the S. & G. office and arrange
for them to pick up the records, because I was through with them.
Then I put them in a certain place and told them where they were, so I
presume he picked them up that day, because he did come over there
occasionally when I asked for him, because he brought me records that
I needed in connection with this tax case from time to time.
Mr. Halley. Did you see Leo Levitt ?
Mr. FuRMAN. I dichi't personally see him.
Mr. Halley. Will you state when you did last see Leo Levitt?
Mr. FuRMAx. I may have seen hiin about 3 or 4 days previous to
that.
]\Ir. Halley. Did you actually see him?
Mr. FuRMAx. Yes, I did.
Mr. Halley. And when did you last speak to Leo Levitt ?
Mr. FuRMAx. At that time?
236 ORGANIZED CRiEVCE IN INTERSTATE, COMMERCE
Mr. Halley. On the telephone or in any other manner?
Mr. FuRMAN. I have never talked to him on the telephone.
' Mr. Halley. Have you had any communication with him since last
Thursday ?
Mr. FuRMAN. I haven't.
Mr. Halley. Will you describe in specific detail the records which
you turned over to Leo Levitt a week ago ?
Mr. FuRMAN. There was a general ledger and the general journals,
and there was one book for 1949, I think it was, called client's ledger,
customer's ledger, or whatever you w^ant to call it.
Mr. Halley. Was there a cash book?
Mr. FuRMAN. Yes.
Mr. Halley. A book showing disbursements?
Mr. P'uRMAN. That is right; that is a part of the journals.
Mr. Halley. Were there canceled vouchers and bank statements?
Mr. FuRMAN. No. The work I was requested by the attorneys to do
did not require me to use that data.
Mr. Halley. The work you were doing had to do with income
received from the S. & G. Syndicate by the various partners ; is that
right?
Mr. FuRMAN. My work had to do with specific questions that the
attorney put to me, and he was largely concerned in finding out from
me as an accountant what the actual bookkeeping and accounting pro-
cedure was.
Mr. Halley. So you went through the books to find that out?
Mr. FuRMAN. To see what the bookkeeping routine was.
Mr. Halley. The attorney was very much interested, was he not, in
the question as to what the actual income of the S. & G. Syndicate
members was ; am I right on that ?
Mr. FuRMAN. He had various reports that had previously been pre-
pared by the one-time auditor of the S. & G. Syndicate who was killed
in an accident some time back. He had all of these reports.
Mr. Halley. As to income?
Mr. FuRMAN. As to income.
Mr. Halley. Since that date various claims have been made by the
United States Bureau of Internal Revenue showing that the income
was very grossly understated ; is that correct ?
Mr. FuRMAN. The United States Bureau of Internal Revenue has
proposed certain adjustments to income, which are being contested.
Mr. Halley. They are rather large, are they not ?
Mr. FuRMAN. They are rather large.
Mr. Halley. You are familiar with them ?
Mr. FuRMAN. I think Mr. Bowden showed me a memorandum at
one time which he had in his possession. I don't recall what it was.
Mr. Halley. Is Samuel Friedman a member of the S. & G.
Syndicate ?
Mr. FuRMAN. According to the information that has been sub-
mitted to me, I would say "Yes".
Mr. Halley. Is Harold Salvey a member of the S. & G. Syndicate?
Mr. FuRMAN. So far, on the face of the information submitted to
me, yes.
Mr. Halley. Is Jules Levitt a member of the S. & G. Syndicate?
Mr. FuRMAN. Similarly, as far as I know.
ORGANIZED CRIME IN INTERSTATE COMMERCE 237
Mr. Halley. Your answer is "Yes" ?
Mr. FuRMAN. That is rio^ht.
Mr. Halley. Is Harry Russell a member, of the S. & G. Syndicate?
Mr. FuRMAN. He became a member, I think, in March of 1949.
Prior to that time he never was.
Mr. Halley. He wasn't a member prior to March of 1949?
Mr. FuRMAN. That is correct.
JMr. Halley, He was a member subsequent to March of 1949?
Mr. FuRMAN. That is right.
Mr. Halley. Subsequent to March of 1949 he held a one-fifth
interest ?
Mr. FuRMAN. I think that is what the records will reflect.
Mr. Halley. Was Edward Rosenbaum a member of the S. & G.
Syndicate.
Mr. FuRMAN. Correct.
The Chairman. Mr. Furman, the staff of our committee has not
had an opportunity to examine the records you have brought here.
We would like to give them that opportunity, and then we would
like to question your briefly about some of the records. Would it be
convenient with you to return at 2 o'clock this afternoon ?
Mr. Furman, Yes; I could arrange that.
The Chairman, All right, Mr. Furman, we will excuse you at this
time. You will remain under subpena and will return to the com-
mittee at 2 o'clock this afternoon.
Senator Hunt. For the record, Mr. Furman, your initials, please.
Mr. FuRiMAN. M. G.
The Chairman. Mr. Jimmy Sullivan, will you come around?
TESTIMONY OF JAMES A. SULLIVAN, SHERIEE, DADE COUNTY,
FLA., ACCOMPANIED BY RICHARD M. HUNT, ATTORNEY
The Chairman. Mr. Sullivan, do you solemnly swear that the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God ?
Mr. Sullivan. I do.
Mr. Halley. Will you, Mr. Sullivan, state your occupation?
Mr. Sullivan. I am sheriff of Dade County.
Mr. Halley. How long have you been sheriff ?
Mr. Sullivan. Since January 3, 1945.
Mr. Hunt. At the outset of this witness' testimony, I would like
to present into the record a statement by way of an objection on
behalf of this witness, which doesn't go to the jurisdiction of the
committee.
The Chairman. I understand, sir, that you are his attorney?
Mr. Hunt. That is correct.
The Chairman. What is your name ?
Mr. Hunt. Richard M. Hunt.
The Chairman. Mr. Hunt, the committee is of course glad to give
you the opportunity to appear with your client. Will you state the
objection that you have to our interrogation of Sheriff Sullivan?
^Ir. Hunt. The objection is not so much to the interrogation of him
as to other matters that affect this witness and the general attitude
and demeanor of certain members of the committee and its counsel
in this proceeding, which I would like to reflect in this record.
238 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. Do you want to make a brief comment? Do you
want to file this objection ?
Mr. Hunt. I would like to read the objection.
The Chairman. How long is it, Mr. Hunt?
Mr. Hunt. Three pages.
The Chairman. Can you outline the objection and summarize it for
the benefit of the committee ?
Mr. Hunt. I would prefer not to in the interest of exactitude.
The Chairman. Very well, will you read the objection?
Mr. Hunt. The Supreme Court of the United States, in Sinclair v.
V. S. (49 S. Ct. 268, 279 U. S. 263) and in Federal Trade Coinmission
Y. American Tobacco Co. (44 S. Ct. 336, 264 U. S. 298, etc.) , said :
* * * And that case shows that, while the power of inquiry is an essential
and appropriate auxiliary to the legislative function, it must be exerted with
due regard for the rights of witnesses, and that a witness riglitfully may refuse
to answer where the bounds of the power are exceeded where the questions asked
are not pertinent to the matter under inquiry.
It has always been recognized in this country, and it is well to remember, that
few if any of the rights of the people guarded by fundamental law are of greater
Importance to their happiness and safety than the right to be exempt from all
unauthorized, arbitrary, or unreasonable inquiries and disclosures in respect of
their personal and private affairs. In order to illustrate the purpose of the courts
well to uphold the right of privacy, we quote from some of their decisions.
In Federal Trade ConimisMon v. American Tobacco Co. (264 U. S. 298, 305, 306,
44 S. Ct. 336, 337 (68 L. Ed. 696, 32 A. L. R. 786) ), this Court said : "Any one who
respects the spirit as well as the letter of the fourth amendment would be loath
to believe that Congress intended to authorize one of its subordinate agencies to
sweep all our traditions into the fire (Interstate Commerce Commission v. Brim-
son, 154 U. S. 447, 479 ; 14 S. Ct. 1125, 38 L. Ed. 1047), and to direct fishing expedi-
tions into the private papers on the possibility that they may disclose evidence of
crimes. We do not discuss the questions whether it could do so if it tried, as
nothing short of the most explicit language would induce us to attribute to Con-
gress that intent. * * * It is contrary to the first principles of justice to
allow a search through all the respondents' records, relevant or irrelevant, in
the hope that something will turn up."
The sovereign legislative power delegated to this committee by Sen-
ate Resolution 202 is definitely limited and restricted to the making of a
study and investigation of the subject matter of the resolution.
Even in the trial of a criminal case, the person accused is presumed
innocent until the contrary is made to appear to the exclusion of a
reasonable doubt. The judge and jury approach their respective trial
functions in the reception and consideration of evidence with open,
fair, and impartial minds, and accord temperate and considerate treat-
ment to the accused.
The proceedings before this committee do not closely approach the
seriousness and finality of trial where judgment and sentence follow
the verdict. This committee can only conduct a study and investiga-
tion through the use of fair and reasonable procedural means, con-
sistent with the power conferred and the rights of citizens compelled
to appear and testify by force of sovereign subpena.
The committee and its counsel, we believe, have transcended the
limits of committed authority, and violated the constitutional rights
of citizens of this country in the following instances :
1, Committee counsel caused an ex-deputy sheriff (Howden) to
testifv to an inadmissible statement of another (wlio denied it) that
the other person had made a very damaging remark concerning a fine
ORGANIZED CRIME' IN INTERSTATE COMMERCE 239
lady, wife, and mother of this city, whose husband is a witness, not a
defendant, before this committee.
Committee counsel well knew that the person to whom the remark
was to be attributed held it to be false, and he further knew, as an
accomplished examiner, that this evidence would not be received in
a court of law under the rules of evidence; but irrespective of his
complete awareness of proclaimed falsity and evidentiary impro-
priety, he deliberately, heedlessly, and unnecessarily brought about
a public smearing and indictment against an innocent lady which,
as he doubtless intended, has brought great grief, hurt, and suffering
to her and her two children,
2. The third-degree attitude and partisan slant of questions pro-
pounded by committee counsel clearly reflect the characteristic of a
prosecutor boring in for the kill, rather than the calm, courteous,
thoroughgoing demeanor of a quasi- judicial, official intent upon a fair
and impartial discovery of facts.
The studied sarcasm and the I-don't-believe-you deportment of
committee counsel betray him as having already chosen sides and
alining himself on the issues before ever hearing the testimony of
witnesses most vitally concerned in the proceeding. Such is not con-
ducive to a fair study and investigation, nor is such demeanor and
actions of counsel fair and just treatment of citizen-witnesses brought
before this body.
3. The chairman of the committee is quoted in the morning paper
as having stated publicly that, "We understand Sheriff Sullivan
has been a very poor boy but he's pretty well off now. We're going
to ask pretty direct questions." This statement, if true, indicates a
state of mind on the part of the chairman which prejudges and con-
victs the witness of corrupt acts before his testimony is even heard
or his records inspected, and bespeaks a mental adoption of the anti-
Sullivan smear campaign of the two local dailies and Mr. Drew
Pearson. Such statements cannot possibly aid the hearing record of
this proceeding, and only serve to (a) damage and slander the wit-
ness in his name and official position, and (h) reflect a prejudgment
which is contrary to American traditions and rules of law in judicial
or quasi-judicial proceedings.
This temple of justice should not be perverted into an inquisition
whipping post ; the witness, an American citizen holding high office in
his community, should not be made a public whipping boy ; and the
committee should not come into this State and city, aline itself with
the political enemies of the witness, and become the sovereign execu-
tioner of the witness and his family under the aegis and shield of
assumed, but undelegated, sovereign power.
The witness has responded to committee process and is prepared to
answer all questions put to him by the committee and to submit docu-
mentary proofs upon both personal life and official acts. He expects
to receive fair, proper, and unprejudiced treatment at the hands of the
committee.
The witness and his attorney hold the committee and its counsel
in the highest personal, professional, and official respect, and fully
respect the process and dignity of the Senate and of this committee.
The witness will not, however, submit lightly to abuse or indignity
in the course of the committee's exercise of committed power to study
and investigate on behalf of the Senate of the United States.
240 ORGANIZED CRIME IN INTERSTATE COMMERCE
In closing I would like to say that nnless Mr. Halley submits before
this hearing evidence which would be admissible in a court of law
in connection with the left-handed and completely hearsay smear of
Mrs. Sullivan yesterday, I would like to move the committee, at the
conclusion of the hearing, to strike this testimony from the record
to the end that innocent persons will not be made to suffer.
The Chairman. ISIr. Hunt, you can make any motion at any time
on behalf of any client that you represent. The committee is glad to
have you make your statement which is now a part of the record.
I think I should call your attention to the fact that of course it
is required of us by the resolution under wdiich we are operating that
we consider and look into corrupting influences that organized crime,
operating in interstate commerce, may have on governing officials or
law-enforcement officers.
We acknowledge that in an inquiry of this kind, it is very difficult
to do that in that some person's name might not be brought out and
to whom some injustices may be done, and it is with that in mind that
I have announced at the beginning of any session that if anyone felt
that their name had been improperly used or that they had been im-
properly accused, this committee would be ready and willing to hear
them.
Just a while ago the chairman received a telegram — it may have
been delivered last night but I just got it a little while ago — in which
Mr. Plissner, about whom Mr. Richard testified yesterday, wanted to
make some explanation following Sheriff Sullivan's testimony.
We expect to call Mr. Plissner to make any explanation he wishes.
The committee has gone to a great deal of trouble in having a pre-
liminary closed hearing in order to try to ferret out the relevant testi-
mony to our inquiry in which we feel the Senate would be interested,
and also the Congress of the United States,
I should call your attention, Mr. Hunt, to the fact that the commit-
tee spent two very full days — Senator Hunt and the chairman — in
going over in executive session a great many conditions that are
alleged to exist in Dade County and in this section of Florida, and
most of which testimony has not as yet been made public.
At that time the committee undertook to call in Sheriff Sullivan
to testify. Sheriff Sullivan was away, I believe, on a fishing trip
on the west cojast. The subpena was not served upon him. Sheriff
Sullivan afterward wired the committee that he didn't know about the
fact that he was wanted or that his testimony was desired, and tliat
he was ready and willing to appear at any time. I think that was
the substance of your telegram ?
Mr. Sullivan. Yes, sir.
The Chairman. So that is the situation.
Mr. Sullivan. I was informed, Senator, however, that there was
no subpena out for me, and that my office informed the caller, who-
ever he may have been, that I could be gotten there right shortly
if it was so desired.
The Chairman. I can only report what was reported to me. Sheriff
Sullivan.
I know the chairman did ask for your aj^pearance at that time, and
that Ave were informed botli at your liome, I believe, and at the
office that you were not available and they didn't know where to find
ORGANIZED CRIME IN INTEKSTATOE: COMMERCE 241
you and they couldn't reach yon, and wouldn't be able to get you to
appear when we were here at that time.
I ordered that a subpena be issued for you — and frankly I can't
say whether it was served or whether or not it was served or what
effort was made to serve it. But inquiry was made and we were in-
formed that we could not find you at that time.
Mr, Halley, do you have any comment that you would like to make
i in reply to Mr. Hunt?
]\Ir, Haixey. If the Chair will excuse me from commenting, I pre-
fer not to.
I do think I should state that the law with respect to Senate com-
mittee hearings is that they are not restricted to the testimony that
would be admissible in a court of law. They are restricted to hearing
1 testimony in hearing which in the good judgment of the committee
! is fair testimony and apt to bring out the facts and the truth, but
I they are not bound by the strict rules of hearsay or any of the other
strict rules of evidence.
I would further simply like to point out with respect to the law that
the testimony to which you referred, even in a court of law, would
not be considered hearsay.
Mr. Hunt. I disagree with you, but very respectfully, sir.
The Chairman. Certainly the cases do not limit a congressional
committee to the type of testimony that is required in a court of law.
All right, ]\Ir. Halley, will you proceed to examine Sheriff Sullivan ?
Mr. Halley. ]Mr. Chairman, Sheriff Sullivan appears to have with
him a nmnber of records and I would like, with the committee's per-
mission, to ask Sheriff Sullivan if he w^ould like to make a statement
before he is questioned.
Mr. Sullivan. Well, first I have a letter that I would like to read
and make a part of this record.
The Chairman. You may do so.
Mr. Sullivan. This is a letter to Senator Kef auver, chairman of the
Special Committee To Investigate Organized Crime in Interstate
Commerce.
The Chairman. What is the date of that letter ?
Mr. Sullivan. July 6, 1950.
Mr. Hunt. This is in answer to your last letter.
The Chairman. I think prior to the reading of this letter, the letter
that the chairman of the committee wrote Mr. Sullivan will be in-
cluded in the record.
(The letter referred to, dated June 26', 1950, is herewith incorpo-
rated :)
United States Senate,
Special Committee To Investigate
Organized Crime in Interstate Commeiece,
June 26, 1950.
Sheriff Jimmy Sullivan.
Dade County, Fla.
Dear Sheriff Sullivan ; The United States Senate has designated this spe-
cial committee to investigate organized crime in interstate commerce. To ac-
complish its objectives, the committee proposes to obtain as much information as
possible concerning tlie operations of organized criminals and racketeers in every
portion of the country. It is hoped that by compiling this information and cross
referencing it, the committee can discover leads which might not be obtained
in investigations confined to particular areas alone.
242 ORGANIZED CR'IME IN INTERSTATE COMMERCE
For this reason, the committee is writing to a number of prominent persons
throughout the United States for the purpose of ascertaining their views on the
activities of organized criminals in their areas. The committee is particularly-
interested in activities in which interstate communication facilities are used,
or in which an investment is made in either legitimate or illegitimate enterprises
of moneys illegally obtained in other areas, or in which some evidence of inter-
state activity can be found. In addition, we are, of course, interested in viola-
tions of narcotics, counterfeiting, and other Federal laws. Where there is evi-
dence such criminals are protected with the connivance of law-enforcement
othcers or other public otHeials. the committee will welcome your advice.
The committee would very much appreciate receiving from you, in such detail
as you see fit, a statement of conditions as you have observed them relating to
the above matters. This statement will serve as a background for further
inquiries and for investigations or hearings. Any infoi'mation furnished wiU
be kept confidential if you so desire.
We know that this request will impose upon both your time and energies, but
we are assured that the sub.iect matter is one in connection with which we have
your full interest and cooperation. This committee realizes that the task before
it is of such great size that it can be accomplished only through the joint efforts
and with the help of all those who are interested in stamping out organized crime
throughout the Nation.
Sincerely,
EsTES Kefaxjver, Chairman.
Mr. Sullivan (reading) :
Hon. EsTEs Kefauvek,
Chairman, Special Committee To Investifiate Organized Crime in Inter-
state Commerce, United, States Senate, Washington, D. C.
Honorable Sir : I beg to acknowledge receipt of your letter of June 26. Your
first inquiry is addressed to activities of organized criminals in which interstate
communication facilites are used, or in which an investment is made in the area
of moneys illegally obtained in other areas, or in which some evidence of inter-
state activity can be found.
The only interstate communication facilities used by persons engaged in race-
track booking activities which have come to our attention are the wire services
which already claimed the attention of your committee, and which have on
several occasions litigated their contentions in circuit courts and supreme court of
this State.
As to investments in this community of moneys, illegally obtained in other
areas, this office has no information. From time to time a local law-enforce-
ment league, and current, a crime commission have cliarged that one or more of
the Miami Beach Hotel properties are owned by persons from other States who
formerly were engaged in illegal enterprises or associations, but whether evidence
exists to support these charges is a matter of which this office has no knowledge,
since no citizen of the county, crime commission, or otherwise has ever presented
my office with evidence, affidavit, or supported charge in this direction. It has
been my experience that the accusations and charges of the so-called crime com-
mission have consistently been broadcast over local radio stations and pulilished
in local newspapers in sensational fashion, rather than being placed before
any warrant-issuing officer or body, such as the county grand .iury, the State
attorney, the county solicitor, any judge of the circuit court, the judge of the
criminal court of record, the county judge, or any of the justices of the peace.
My office has many times publicly solicited evidence upon which to ground crimi-
nal charges against any of the persons mentioned in these radio broadcasts and
newspaper articles, but we have yet to interview the first citizen, or to receive the
first affidavit in connection therewith.
My office is not apprised of violation of narcotics, counterfeiting, and other
Federal laws which fall witliin the province of Federal law enforcement agencies,
except that we give full cooperation to tlie investigation and appreliension activi-
ties of tlie Federal authorities, and when oxu- officers detect such offenses or
offenders, the proper Federal authorities are immediately notified and prompt
action taken.
It has never come to my attention that law enforcement officers of this county
are in connivance with any chiss of criminal or racketeer.
You invite my views relating to conditions in tliis county touching upon the
subject matter of your letter, wiiich are lierewitli presented, viz:
(a) It is my definite opinion that this county has been unjustly scandalized
and maliciously slandered by the local crime commission and the two daily news-
ORGANIZED CRIME: IN INTERSTATEi COMMERCE' 243
papers of Miami in their sensational newspaper-selling charges of the existence
of a criminal and racketeer situation in Dade County which does not exist In point
of fact. Beinij; a resort community, with hundreds of thousands of tourists
visiting us each year, any reasonable-minded person would know that some of
the undesirables ot the Nation will be among tiie desirables who visit us, but it
does not at all follow, as seems to be the theme song of the newspapers and their
crime commission, that the entire county is bad, or that the people of this county
are bad, merely because of the presence within our borders of a liandful of these
undesirables. Naturally, tlieir coming here is to be, and has been, discouraged
by my office through use of legal processes, wherever same could be applied in a
legal manner ; however, the complaints of my critics seem to be that I have been
unwilling to breach my $25,000 fidelity bond and my oath of office by adoption of
illegal methods in the handling of this problem. We have never refused or
delayed, and shall never refuse or delay, to effect an arrest or execute a warrant
for anyone where the proper initiating affidavit is made out and the warrant
delivered to my office for service ; and as above indicated, I have publicly solicited
information and evidence, and have offered the full cooperation of my office to
the end of eliminating the undesirable element from this county.
(b) Approximately $200,000,000 per year is gambled in this county through
legalized pari-mutuel machines at the horse and dog tracks, which are operated
by the State of Florida in conjunction with the track owners. This condition
seems to surcharge the atmosphere with the spirit of betting, and to incline public
opinion considerably in favor of the placing of bets on horse and dog races and
therefore reacts against a strict enforcement of the State gambling laws relating
thereto. This situation renders the task of my office in enforcing the gambling
laws, particularly against bookmaking, an extremely difficult one, as we have
little, if any, cooperation from the public in the furnishing of evidence or filing
of complaints against the operators of this particular class of illegal activity.
The question is often asked as to why it is sinful and against the law to bet $10
on Mollio-0 in the fifth race outside the wooden fence of a race track when the
person placing the bet can bet the same amount on the same horse and in the
same race within the confines of the track, and still be a good citizen. However,
i realize these considerations are for others and not for the sheriff of a county,
since it is his duty to enforce the law as he finds it upon the statute books. This
I have consistently done to the very best of my ability.
For your information, in the year 1948 my office handled 279 gambling cases,
or an average of 23i/2 cases per month. In the year 1949, my office handled 574
gambling cases, or an average of 47^/^ cases per month. With the recent addi-
tion of several men in my criminal department, we are making an all-out effort
to stamp out this and other classes of gambling in Dade County ; and in this
regard, my office receives the fullest assistance and cooperation of the governor,
the State racing commission, the State beverage department, and other State,
county, and municipal enforcement oflScers.
I was of the opinion in 1944, when I first became sheriff of this county, and am
still of the opinion, that the only real solution to the local gambling problem
lies in the adoption of a modified form of legalized gambling where all betting,
not only on the ract tracks but off the race tracks, would be permitted under
strict State sui)ervision with the State collecting the revenue for the benefit
of the taxpayers and public institutions of the county. Through such means,
I believe that gambling racketeers would be promptly put out of business,
necessary street improvement, sewerage installations, public schools, and other
buildings could be provided, parks could be beautified, and the public welfare
better served generally, without a dime's additional tax expense to the taxpayers
of the county. I realize that a large number of persons in the county stand in
opposition to such a plan, but it is my belief that if the same were submitted to a
referendum selection of taxpayers and citizens of Dade County, the oppositionists
would find themselves in the minority at the voting booths.
Notwithstanding the personal views above expressed, as sheriff of Dade
County, I have been, and will continue to be ever mindful of my official duty as
regards gamblers and other types of lawbreakers, and will vigilantly enforce
the gambling laws, as well as other laws pertaining to criminal violations as
and when the same occur and my office is able to detect and apprehend the
offender.
You are at liberty to handle this letter on a confidential basis, or otherwise, in
your own discretion.
Very truly yours,
Jimmy Sullivan,
Sheriff, Dade County, Fla.
244 ORGANIZED CRIME IN INTERSTATE COATMERCE
Mr. Halley. Is there any further statement you want to make?
Mr. Sullivan. Mr. Halley, I have some records of our office that
I would like to present to this committee.
However, along the same facts that I am speaking of here, the letter
that I just finished reading, I would like to present the winter term
grand jury report of 1948, tlie articles that are marked on page 5.
The Chairman. The report will be made exhibit No. 127. (Appen-
dix, pp. 755-759.) You can read any part of it you want to.
Mr. Sullivan. It is short. I will read it.
The Chairman. All right.
Mr. Sullivan (reading) :
It has long been a known fact that law-making bodies cannot successfully
legislate morals. The best example of this statement was the late lamented
Prohibition Act. Impossibility of enforcement led to a general breakdown in all
law enforcement. We are faced today with the same situation on the question
of gambling. This grand jury has pondered the question thoroughly and deeply ;
it has gone through every phase of gambling activities, from bookmaking to
mobster infiltration. The consensus of opinion of the grand jurors has boiled
down to the fact that inasmuch as we find general laxity in the enforcement of
the gambling laws, and that inasmuch as pari-mutuel betting has been legalized
by the State, and that furthermore if all who desire to bet were compelled to
attend the various pari-mutual establishments they could not be accommodated
we believe that a solution would be to legalize bookmaking where bets may be
made and coursed through whatever pari-mutual establishment w;is operating
at the time, thereby gaining for the State the revenue that it now loses through
sneak bookmaking.
Such legalized bookmaking stations should be licensed and controlled by the
State, county, or municipal governments, whichever the legislators, in their
judgment, may deem best. Policing of such a set-up should be put into the hands
of the State racing commission, and the funds of such policing should be derived
from the revenue received by the State racing commission.
Now, I would like to read some notations here that were received by
me, such as correspondence under date of February 4, 1947.
The Chairman. You can file all of this as part of the record and
read whatever you want to, if you wish.
(Correspondence referred to was read into record. See below.)
Mr. Sullivan. This is from the attorney general of the State of
Florida.
The Chairman. Wlio was the attorney general at that time?
Mr. SuLLrv'AN. Tom Watson.
In leading up to this letter from the attorney general of the State
of Florida I would like to read here just one of the many articles that
came into my office through sneaks and through the back door and in
many other ways. It is not open and aboveboard, and was not done in
a helpful manner or in a manner to help our office or to help our
county ; just plain politics. Here is the copy :
January 22, 1947.
Mr. James Sullivan,
Sheriff of Dade County, Fla., Miami, Fla.
Deau Sir: As you must already know, extensive, open, illegal gambling is now
being conducted at the Sunny Isles Casino, Dade County, Fla.
The Law Enforcement League of Dade County demands that you do your duty
and stop this notorious violation of law.
As citizens of Dade County, we will not be satisfied with token raids or other
inett'ectual actions on the part of your office. You have adeipiate means at your
command to enforce the law, as outlined in swtion 144.02 of the Florida Statutes,
and we demand that this be done immediately.
ORGANIZED CRIME IN INTEESTATE COMMERCE 245
Moreover, we extend to you all the facilities of our organization and agree to
furnish all additional deputies needed for this purpose.
Sincerely,
George Light,
Secretary, Laiv Enforcement League of Dade County, Fla.
There was a copy of this sent to the grand jury, which was in opera-
tion, and to the Miami Herald and Miami Daily News. All for no
good purpose.
The Chairman. What is tlie date of that letter, did you say ?
Mr. Sullivan. The date of that letter was January 22, 1947.
I have a letter here to the Law Enforcement League of January 27,
1947:
Law Enforcement League,
Miami, Fla.
Gentlemen : I acknowledge receipt of your letter of the twenty-fourth instant,
copies of which you delivered to the local press.
Deputies have visited and checked operations at the place of business men-
tioned in your letter and found no law violations. You may have defeated your
professed purpose by your haste for publicity.
Since the first week of my administration as sheriff, certain individuals and
organizatiotns have beset and harassed this office in the public press for the
purpose of embarrassing and intimidating me in the performance of my official
duties. Time after time I have solicited the complaining and allegedly informed
person to persons to subscribe to the affidavit for search warrant prescribed in
chapters 933.04, 933.05, and 933.06, Florida Statutes Annotated, but to date no
one has been willing to do more than write a letter for newspaper purposes or
send in anonymous telephone calls. The sections of law to which I refer are as
follows :
"933.04 Affidavits.— The right of the people to be secure in their persons,
houses, papers and effects against unreasonable seizures and searches shall not
be violated and no search warrant shall be issued except upon probable cause,
supported by oath or affirmation particularly describing the place to be searched
and the person and thing to be seized."
"933.0.5 Issuance in Blank Prohibited. — A search warrant cannot be issued
except upon probable cause, supported by affidavit or affidavits, naming or de-
scribing the person, place or thing to be searched and particularly describing
the property or thing to be seized ; no such warrant shall be issued in blank and
any such warrant shall be returned within 10 days after issuance thereof."
"933.06 Sworn Application Required Before Issuance. — The judge or mag-
istrate must, before issuing the warrant, have the application of some person
for said warrant duly sworn to and subscribed, and may receive further testi-
mony from witnesses or supporting affidavits, or depositions in writing, to sup-
port the application. The affidavit and further proof, if same be had or re-
quired, must set forth the facts tending to estalilish the grounds of the appli-
cation or probable cause for believing that they exist."
Chapters 901.01 and 901.02, Florida Statutes Annotated, provide :
"901.01 Judicial Officers To Be Committing Magistrates. — All judicial
officers of this State shall be conservators of the peace and committing magis-
trates, and may issues warrants against persons charged on oath with violating
the criminal laws of the State, and may commit offenders to jail or recognize
them to appear before the proper court at the next ensuing term thereof to
answer the charge, or may discharge tliein from custody, according to the cir-
cumstances of the case and may require sureties of the peace when the same
has been violated or threatened. When a complaint is made to a magistrate
that an offense has been committed within his jurisdiction, he shall examine on
oath the complainant and any witnesses he may produce.
"901.02 When Warrant of Arrest To Be Issued. — A warrant may be is-
sued, for the arrest of the person complained against if the magistrate, from the
examination of the complainment and the other witnesses, if any, has reasonable
ground to believe that any offense was committed within his jurisdiction and
that the person against whom the complaint was made committed it ; provided,
however, that a warrant may be issued by said magistrates for the arrest of
the person complained against, upon presentation to him of affidavits sworn to
by the complaining witness or witnesses before the prosecuting attorney, pro-
246 ORGANIZED CKIME IN INTERSTATE; COMMERCE
vided such prosecuting attorney is authorized to administer oaths as a notary
public or otherwise."
Chapter 30.15, Florida Statutes Annotated, requires this office to execute
process of the supreme court, circuit court, county court, criminal court of record
and justice of the peace courts. By other statutes, we are required to execute
process of the civil court of record, the county judge's court, the court of crimes
and the juvenile court.
Chapter 30.19, P^lorida Statutes Annotated, prescribes a penalty for failure
to execute any writ or other process, civil or criminal, legally issu9d and directed.
Chapter 144.01 authorizes the arrest, without warrant of any person who is in
the disturbance of the peace.
Chapter 901.15 provides for arrest without warrant by a peace officer when a
felony or misdemeanor has been committed in his presence, or, in the case of
felony only, when a felony has been committed and the officer has good reason to
believe the person to be ari-ested committed it. This chapter also requires arrest
upon warrant duly issued.
Article 5, section 15, of the Florida Constitution, states that the duties of a
sheriff "shall be pre.scribed by law."
I have undertaken to apprise you of some of the statutes which touch upon
the matter mentioned in your letter and the duties of this office in order that you
may understand why phone calls, anonymous notes, and high-pressure letters
written for newspaper spread cannot be accepted by this office as furnishing
legal basis for a raid or arrest. Although I am sure your organization has the
purest of motives, you must realize that the powers of this office are quite ofteu
sought for purposes of spite, blackmail, and other ulterior motives, and the people
are entitled to the protection against false arrest and unlawful search that the
law intends and contemplates by reqixiring the complaining and allegedly informed
person to execute an affidavit, except in the cases which I have mentioned.
Any evidence or information of a law violation which you possess and desire
to furnish in sworn form should be furnished to the county solicitor, the grand
jury, the county judge, the justice of the peace, or to any circuit judge.
If and when I I'eceive a warrant or capias from any of these judicial officers,
I shall execute it efficiently and expeditiously.
Furthex'more, I shall continue to detect and arrest crime in this county to the
best of my ability and within lawful bounds wherever it is found. This means,
in the case of gambling, that my deputies will arrest without warrant and prefer
charges in every instance where they are able to elude watchers and spotters
and gain entry peaceably and without force and personally witness the acts you
say are being committed.
That was the letter that I sent to the law enforcement league, and
here is the letter that I sent to our attorney general, Tom Watson, also
on January 27, enclosing the letter which I have just read pertaining
to the laws of the State of Florida on the arrests, warrants, searches
and seizures :
Hon. Tom Watson,
Attornei/ General, Tallahassee, Fla.
Dear Sir : I enclose copy of letter received by me on the twenty-fourth instant
from an organization called the law enforcement league, together with my reply
of the twenty-seventh instant.
I would appreciate your advising me as to whether, in my reply, I have correctly
stated and interpreted my official duties in the matter and if not, wherein I am
in error.
Thanking you for this service, I am
Yours very truly.
This is the letter from the attorney general addressed to me on
February 4, 1947.
Hon. Jimmy Sullivan,
Sheriff of Dade County, Court House, Miami, Fla.
Dkar Mr. Sitllivan : This will acknowledge receipt of your letter of January
27, last, as well as the enclosed copy of letter addressed to the law enforcement
league under date of January 27, also.
Please be advised that your reply to a letter from said league is entirely sat-
isfactory and appropriate.
Sincerely yours,
J. Tom Watson, Attorney General.
ORGANIZED CRIME IN INTERSTATE COMMERCE 247
I The Chairman. Let this correspondence be filed as exhibit No. 128.
I Mr. Sullivan. I have here the opinion from the supreme court of
the January term, dated January 17, 1950, which the opinion was
filed, and which I took up with my attorney for a breakdown of the
opinion as to my duties and what I should do in this protection of my
office, with search warrants, with the issuance of search warrants.
It reads (reading) :
Re : Search warrants.
Jimmy Si^tllivan,
Sheriff, Court House, Miami, Fla.
Dear Sheriff: We call your attention to an opinion of the Supreme Court of
Florida tiled January 17, 1950, which imposes considerably more of a burden
upon peace officers in the obtaining of a valid search warrant under Florida law.
In the future, the person applying for the warrant must himself be. able to
particularly describe the place to be searched, the things to be searched for,
and the perscm or persons to be arrested, or if he has gained his information
as a result of another person's investigation, he must state particularly, in the
words of the court, "how the affiant came by the intelligence" and if through
someone else, the other person's name must be disclosed together with such
further information as "would be competent in the trial of the offense before
a jury and would lead a man of prudence and caution to believe that the
offense has been committed."
Note the concluding language of the court which states that : "We are not
unaware that guilty persons may go free where convincing evidence against
them is held inadmissible because obtained by defective search warrants. But
our paramount concern is for the guaranty in the organic law against unrea-
sonable searches. We have spoken on this subiect, too, in Cooper v. State,
supra, where we approved Judge Cooley's comment that 'It is oftentimes better
that crimes should go unpunished than that citizens should be liable to have
their premises invaded.' "
In view of the above, a peace officer will no longer be able to make a proper
affidavit or search warrant upon the basis of information furnished by another
without fully revealing the identity of the other person, the manner by which
he gained his knowledge, and all other facts pertinent to or bearing uiwn the
other person's investigation and his entire connection with the matter. This
means that information furnished by undercover operators or citizens who do
not wish to have their identity disclosed no longer can be used without publicly
recording all names and other factors involved.
A copy of the supreme court opinion referred to is hereto attached.
Very truly yours.
The Chairman. Who is that letter from ?
Mr. Sullivan. That is from Mr. Hunt here. This is the letter,
and that is the opinion of the Supreme Court of the State of Florida
[indicating].
The Chairman. Is Mr. Hunt the county attorney or is he your
personal attorney ?
Mr. Sullivan. Mr. Hunt is my attorney for the office, the sheriff's
office.
The Chairman. Is that a county position, or did you just employ
him ? In other words, who pays him ?
Mr. Sullivan. He is paid out of the fees from the sheriff's office.
The Chairman. Let this letter and the opinion be filed as exhibit
No. 129.
(The opinion referred to appears in the appendix on p. 759.)
The Chairman. Is this position of attorney for the sheriff's office
a legally constituted office ?
Mr. Sullivan. Yes, sir.
The Chairman. Do you mean that it is set up by statute ?
68958 — 50 — pt. 1 17
248 ORGANIZED OEaME IN INTERSTATE COMMERCE
Mr. Sullivan. Yes, sir; it is. You see, we have so much civil liti-
gation in our office that daily we have to refer to our attorneys.
The Chairman. Well, you have county solicitors; don't you?
Mr. Sullivan, We have county solicitors, but they don't advise us
on these things.
The Chairman. Would they advise you on these things if you
asked them to ?
Mr. Sullivan. I have talked with them, but they tell me to get
together with my attorney.
The Chairman'. And the sheriff here has always had an attorney
for his office, separate from any others ?
Mr. Sullivan. Yes, sir. I believe they all have attorneys.
The Chairman. What does that position pay? Do you know what
it pays ?
Mr. Sullivan. It's either $300 or $350 a month.
The Chairman. That is customary in Florida for the sheriff to
have an attorney for his office to advise him about matters?
Mr. Sullivan. Yes; it is, because we have so much litigation that
the duly elected and appointed attorneys don't have time to handle.
The Chairman. Does the sheriff select the attorney for the sheriffs
office?
Mr. Sullivan. Yes ; he does.
The Chairman. Mr. Hunt has been your attorney ever since you
have been sheriff ?
Mr. Sullivan. No ; he hasn't.
The Chairman. Whom did you have before ?
Mr. Sullivan. I had a Mr. Hollis Einehart.
The Chairman. Did the sheriff before you have an attorney for
the sheriff's office ?
Mr. Sullivan. Yes ; he did.
The Chairman. All right, sir; you go ahead. I simply wanted to
clear that up.
Mr. Sullivan. Senator, I would like to show here what we do in
our office with the few men that I have.
The Chairman. Well, you have quite a long document here.
Mr. Sullivan. That is true, but there is some of the substance in
there that I would like to bring out.
The Chairman. You may file the document as exhibit No. 130, and
you can make any exijlanation you want, Mr. Sullivan, or bring out
any particular point you wish.
(Statistics for sheriff's office, Dade County, Fla., 1945 through 1949,
ap])ear in the appendix on pp. 760-765, as exhibit No. 130.)
Mr. Sullivan. Thank you. I am going to start with the past full
year of 1949. In the year of 1949 our office handled 8,301 prisoners.
Fines and forfeitures for that year were $131,942.56. We had con-
victions of 5,777.
Prisoners sent to the State penitentiary were 277. Warrants and
capiases served were 4,693. Homicide investigations were as follows :
Murder, 73 ; fatal accidents, 53 ; rape, 70 ; suicide, 63 ; drowning, 24 ;
and natural deaths, 158.
We want to bring out the number of persons fingerprinted and
photographed, listed according to crime committed :
ORGAJs^ZED CRIME IN INTERSTATE OO^MJVIERCE 249
Gambling, 44; operating a gambling house, 494; lottery, 19; illegal
possession of punchboards, 10 ; murder, ;i2— there is something wrong
there ; this is not right — manslaughter, 23 ; rape, 20,
The number of arrests for illegal possession of slot machines is 7,
and the number of machines seized is 20.
That was in the year of 1949.
And here are the statistics for the month of February 1, 1950^
through March 15, 1950. That is 45 days ; and I would like to present
this along with our other information. I have much more here. I
have each month in detail, of what our office does with gambling and
the operating of gambling places.
This is for January 1950 : Operating of gambling houses, ?A — this
is for persons fingerprinted and photographed, listed according to
crime connnitted — lottery, 12 ; gambling, 12 ; and that is for the month.
of January.
The Chairman. The committee will be glad to receive these as ex-
hibit Nos. 131 and 132.
(Statistics for sheriff's office, February 1-Marcli 15, 1950, were
marked "Exhibit No. 131," and appear in the appendix on p. 7(55.
Report on activities of sheriff's office for January 1950, dated Febru-
ary 6, 1950, was marked "Exhibit No. 132" and appears in the
appendix on p. 766.)
The Chairman. Senator Hunt has a question he wishes to ask.
Senator Hunt. Sheriff, you mentioned two figures — 7 and 20 — w^ith
I'ef erence to slot machines. What was the 7 figure ?
Mr. Sullivan. That was the number of persons arrested; and the
20 was the number of slot machines seized. Just a minute
Senator Hunt. Well, that answers my question sufficiently.
Mr. Sullivan. The number of arrests made for illegal possession
of slot machines was 7. The number of slot machines seized was 20.
Senator Hunt. Now, Sheriff, do you know how many permits, $100
Federal permits, were paid here in the county in 1948 on slot machines ?
Mr. Sullivan. Senator Hunt, I wouldn't know that, for this reason :
We take every slot machine that we can find in our county.
Senator Hunt. It would, however, run up into the thousands, would
it not?
Mr. Sullivan. Perhaps it would; but the machines have not been
in Dade County — I mean, operating in Dade County.
Senator Hunt. Would you mind giving us the breakdown on the
277 that were sentenced to the penitentiary, if you have it? If you
don't have it, it is not too material.
Mr. Sullivan. Well, I don't have any breakdown with the exception
of the time that they all served. That is all I could Sfive you on
that. ^
Senator Hunt. Could you tell me if any of them were bookies?
Mr. Sullivan. I can't tell you definitely, but I don't believe that
any of them were.
Senator Hunt. That is all I have to ask, Mr. Chairman.
Mr. Sullivan. Now, just for comparison, we go along to the year
of 1948, and here are the statistics of this office :
Prisoners handled were 8,903; fines and forfeitures, $105,101.88.
It goes on through the subpenas which were served: 14,137. The
warrants and capiases served were 4,587. The total homicide investi-
gations were 355.
250 ORGANIZED C'RITME IN INTERSTATE COMMERCE
Now, these homicide investigations are : Murder, 55 ; fatal accidents,
36 ; rape, 68 ; suicide, 51 ; drowning, 40 ; natural deaths, 105. In these
investigations, if there is any peculiar circumstance surrounding any
death that we find in Dade County, wherever it happens to be, our
office or a deputy sheriff, or one of our special deputy sheriffs, makes
investigations of these homicides that occur in Dade County.
Assaults with deadly weapons, attempted rape were 361 ; burglary,
robbery, and miscellaneous investigations were 1,361; which made a
total of investigations of 2,077.
Prisoners fingerprinted were 2,760.
Senator, why I like to bring this out here is that it has been openly
rumored and stated that this office, my office, does nothing whatsoever.
This is perhaps the first time that the people of our county have had
a chance to find out what the sheriff's department does in Dade County.
If we have convictions, you read about them maybe on the back page
or maybe in the inside or the middle of the paper. Most of the time
what we get in the paper is absolute ridicule.
It hasn't been 10 days since the papers have been sort of putting
me on the back page; but, up until that time, anytime me or my office,
or anyone having anything to do with me, was mentioned in the
newspapers he was mentioned in a berating manner or cast off in some
way. And when you have 6 years of this, continuously — these papers
did everything possible that they could do in the last election, by lies
and everything else, in trying to defeat me, with their two powerful I
radio stations and in every publication that came out. They even at
one time refused to put an'ad in the paper for me.
It has been a one-sided fight throughout. They have generated these
law-enforcement leagues; they have made our county look awful.
They have scandalized us throughout the whole United States. That
is, o'ur two papers. And I don't have to tell anybody about that.
Any of you people who live all over the United States can pick up one
of these papers and say, "Better be careful going to Dade County.
They'll cut your head off ; jerk you in some dark alley and cut your
head off." It started 10 days after I took office, and it has been with
me ever since.
The people here in Dade County are well aware of the fact that I
was elected the last time with a big majority.
The Chairman. By how much ?
Mr. Sullivan. I believe it was 17,000. There were more votes cast
in the sheriff's race in Dade County than in any other race; more votes
than in any other race. That was in the actual election.
The Chairman. Were these 2-year terms that you were elected for?
Mr. Sullivan. Four-year terms. I was elected the first time in
1944, after trying to join each branch of our United States service
while I was still a police officer in downtown Miami. Then, when I
failed to get into the service, well, I thought that I could be elected
sheriff of Dade County, and I ran for this office, and the people
elected me.
In the year of 1948 the number of arrests for illegal possession of slot
machines" was 6 ; the number of slot machines seized was 10.
The Chairman. What year was that?
Mr. Sullivan. That was the year of 1948.
Tlie Chairman. How many slot machines were seized ?
ORG'ANIZED' CRIME IN INTERSTATE OOMMEROE 251
Mr. Sullivan. Ten. We had at that time eight cases of gamblino;.
We don't charge people with gambling, becanse they get off witli a
fine of $10 to $25, or something like that. We charge them with oper-
ating a gambling house. If the horses are not here, I believe the fine
is either $200 or $250. When the horses are running in Dade County,
the fine is $500. We had 2G9 cases of operating gambling houses;
illegal possession of punchboards, 2; murders, 7; manslaughter, 15;
rape, 15.
The Chairman. The committee will study these reports that you
have prepared. Sheriff Sullivan, and they will be made exhibits to
your testimony.
Mr. Sullivan. I might also say in here, Senator, that this office,
in my first 4 years of being sheriff, earned $2:35,000 in excess fees for
our county. That was earned and turned back to the operating ex-
penses of our county, turned back to our taxpayers.
Previous to my taking office, the most that was earned was $58,000
in 4 years.
The Chairman. You are not on a fee basis. You are on a salary
basis ; are you not ?
Mr. Sullivan. My office is strictly on a fee basis. I make a budget,
and I can operate up to that budget, providing I make enough money
to pay with, which I have always done, and my budget today is pretty
big.
We have, I believe, 105 in our sheriff's department, and I believe
13 or 14 of those men are deputy sheriffs who have school assigmiients
only. They are older men. They work in our county schools in the
unincorporated areas.
We have 33 of our men working on our road patrols, and the rest
of them are deputy sheriffs, of which we have 23 that are in the
civil department, which serves all of the civil processes of our
county.
We have 11 of them that work up at the desk and in the jail as
jailers. We just lost a couple of prisoners, but they broke out of a
rusty part of our section of the jail.
The Chairman. Is your salary fixed by law, or just how is it
fixed?
Mr. Sullivan. Senator, the salary is fixed by law.
The Chairman. What is your salary ?
Mr. Sullivan. Well, now' it's $12,000.
The Chairman. When did it get to be $12,000 ?
Mr. Sullivan. At the last legislature. That was 2 years ago.
The Chairman. So, your salary during 1949 was $12,000?
Mr. Sullivan. Yes.
The Chairman. And your current salary is at the rate of $12,000
a year ?
Mr. Sullivan. It is now.
The Chairman. Before then it was how much ?
Mr. Sullivan. $10,000.
The Chairman. In addition to that do you get any fees out of the
sheriff's office ?
Mr. Sullivan. I make a correction on the salary there. You
asked me "before then." Before then it was $7,500. AVlien I went in
the office my salary was $7,500 yearly.
252 ORGAXIZED ORfTME IN ESTTER'STATE OOMME'RC'E
The Chairman. During what years was it $7,500 ?
Mr. Sullivan. It was '45, '46'; I believe a part of '47, maybe the
first 2 or 3 or maybe 4 months of '47.
The Chairman. Then the remaining part of '47 and all of '48
it was $10,000?
Mr. Sullivan. Yes, sir.
The Chairman. And in '49 and this part of '50 it is $12,000?
Mr. Sullivan. That's right.
The Chairman. How about your deputies; who fixes their sal-
aries ?
Mr. Sullivan. I fix their salaries.
The Chairman. They don't participate in any fees above their
salary ?
Mr. Sullivan. No, they don't. And regardless of how much I
earn I still get what is prescribed by law as my salary.
The Chairman. Whether you earn it or not ?
Mr. Sullivan. Yes, sir — No, no, no ; if you don't earn it you don't
get it.
The Chairman. You mean, if your fees don't make up that much ?
Mr. Sullivan. If you want to put it that way. If your fees
don't make it we don't get it. If we don't have it in the office we
don't get the money. I don't know just what will happen. We will
just have to cut down, that's all.
The Chairman. But you have always gotten your full salary
because you have always had a surplus ?
Mr. Sullivan. Yes. I have always turned in considerable money
to our county. We have complete records of that in the office.
The Chairman. Now, let us get all of your records in here. Sheriff
Sullivan. We don't want to hurry you, but as you know, we have
many witnesses to hear.
Mr. Sullivan. I would like to make a little clarification on some
of these things, which I attempted to do a while ago on the homicide
investigations that we have. I don't know whether it was thoroughly
understood or not that in all of the deaths that we have in our county
if there is anything, any surrounding circumstances at all, they are
investigated by our homicide department; and even, at times, some
natural deaths are investigated.
I have two previous records of my predecessors here.
Senator Hunt. Mr. Chairman, can't those just be taken into the
record? I don't know that we need to discuss the records of his
predecessors in office.
The Chairman. We will have them. The point that you want to
make is that what you have done compares favorably ?
Mr. Sullivan. Yes, sir.
The Chairman. All right, sir; they will be filed as exhibits to your
testimony. (Statistics for sheriff's office, 1944 and 1943, were marked
''Exhibit No. 133," and appear in the appendix on p. 768.)
Mr. Sullivan. Here is a photograph of some of the men that took
part in a raid that I believe they spoke of yesterday [handing docu-
ment to chairman]. Those are some of the men that were there in the
raid that took place yesterday.
It took place up in back — I don't know what the name of the hotel
was. It's an old hotel, back of the Army and Navy Club at One Hun-
ORGANIZED CRIME IN INTERSIATE COMMERCE 253
dred and Twenty-first Street, west of the boulevard, about a distance
of three blocli:s.
Tlie Chairman. Tliis picture which you have lumded me is a pic-
ture, apparently, of a racehorse wire set-up.
Mr. Sullivan. Yes, it is.
The Chairman. For the transmission of racing information?
Mr. Sullivan. Yes, sir. There was eight trunk lines coming into
this, serving there from downstairs.
The Chairman. Who are the people in this picture, Sheriff Sullivan ?
Mr. SuLi.iVAN. This one here [indicating] is Mr. Toni, who was
here yesterday.
The Chairman. We remember Mr. Toni.
Mr. Sullivan. And this is Mr.
The Chairman. Gasque ?
Mr. Sullivan. Yes. Buddy Gasque. And this is one of my men,
George Patton; and this is also one of my men. Red Hughes.
The Chairman. Let tliat be filed as an exhibit. (Photograph re-
ferred to was marked "Exhibit Xo. 134" and is on file with the com-
mittee. ) Did you have something further you wanted to say about it ?
Mr. Sullivan. Well, I thought it might possibly clear up some
matters there, which we have many of these types of raids in our
countj^; which we have had many of them. For the record here are
some of our raids in 1950. This was submitted to me by my chief
criminal deputy, Claude High, who is the criminal investigator.
The Chairman. Will you describe it. Sheriff Sullivan?
Mr. Sullivan. Yes, sir. These are the raids we made in different
places in our county, and the telephones and the wire service equip-
ment that were received, that w^e took into possession.
On March 5, 1949, the Arlington Hotel, 455 Ocean Drive, Miami
Beach : We got six telephones and w^ire service equipment.
The Chairman. Is that for this year or last year?
Mr. Sullivan. This is the last part of last year and — I'll read what
it says here :
The following is a partial listing of places that have been raided by this depart-
ment where three or more phones have been confiscated. This also includes
other apparatus used in bookmaking establishments.
The Chairman. All right. The committee will be glad to have
this as an exhibit to your testimony. (Memorandum dated July 12,
1950, listing places raided by sheriff's office, Dade County, was marked
"Exhibit No. 135," and appears in the appendix on p. 769.)
Mr. Sullivan. Would you like to hear about the phones and what-
not that we have confiscated ?
The Chairman. Tell us anything you want to tell us about it.
Mr. Sullivan. All right. We have six telephones and wire service
equipment from the Arlington Hotel. We have five phones that were
taken up in North Miami, where an arrest was made. I believe the
man was Louis Kaufman. We have seven telephones from the Avia-
tion Building, Northwest Twenty-seventh Avenue and Thirty-third
Street. From 6505 Northwest Eighteenth Avenue, 6 telephones
(used), 15 telephones (new, in boxes), 1 Army field telephone set, and 2
head sets were taken. At 139 Lindsay Court, Hialeah, Fla., eio:ht
telephones and radio equipment were taken.
254 ORGANIZED CHIME IN INTEKSTATE OOMME'RCE
On January 4, 1950, at 2194 South Red Road, three telephones and
equipment; January 13, 1950, 2360 Northwest Eighty-first Street we
had five telephones and equipment ; from 207 West Flagler, January
19, 1950, four telephones and equipment; 2180 Northwest Seventh
Avenue, four telephones and equipment.
Now, these are on the beach at the different hotels.
At the Versailles Hotel there were three telephones. At the Clay
Hotel there were three telephones. At the Good Hotel there were
three telephones. At the Sea Isle Hotel, three telephones; the Monte
Carlo Hotel, three telephones; the Martinique Hotel, four telephones^
and the Delmonico Hotel, three telephones.
At the Tower Radio Shop— that was April 6, 1950— at 718 South-
west Fifteenth Avenue, five telephones and equipment; Suburban
Club Apartments, 1539 Northeast One Hundred and Twenty-first
Street — that is the information I gave you there [pointing to group of
exhibits]. From the Suburban Club Apartments, one six positions
(12-line rotary) switchboard with 20 extra phones confiscated, and
other equipment.
April 14, 1950, at Greentree Hotel, 110 Northeast Second Avenue^
six phones and otlier equipment.
At the Betsy Ross Hotel, April 25, 1950, at 1044 Ocean Drive,
Miami Beach, three tele])hones ; and at 210 Twenty-first Street, three
telephones. The total phones confiscated for that period were 137.
The Chairman. Let me see that. Sheriff Sullivan. That is dated
July 12, 1950. This apparently covers a period beginning March
1949. As to these telephones, do you mean that they are just tele-
phones that you raided and took out?
Mr. Sullivan. They are horsebooks. Arrests were made at each
one of those places. I can't tell you offhand how many arrests were
made, but the records are in my books, the daily arrest sheets.
The Chairman. Do any of these descriptions fit the Roney Plaza ?
Mr. Sullivan. No, they don't.
The Chairman. You know that Mr. Erickson has had quite an op-
eration there for some time, do you not ?
Mr. Sullivan. Yes. I have heard the testimony.
The Chairman. You have known that for some time, have you not?
Mr. Sullivan. No, I haven't.
The Chairman. Hasn't it been common knowledge for some time?
Mr. Sullivan, There was an arrest; I believe that may have been
in '47, '48. I'm not sure. I couldn't say positively, but I believe
that there was an arrest for horsebooking in the Roney Plaza Hotel.
The Chairman. You remember, do you not, Mr. Sullivan, that there
were a lot of complaints made about the previous operator there, Mr.
Salvey, in the newspapers, and that the operators of the Roney Plaza
decided that they had better cliange operators, and they changed from
Mr. Salvey to Mr. Erickson ? That has been in the newspapers, hasn't
it?
Mr. Sullivan. Well, if it has, I haven't read it.
The Chairman. How about the Boulevard Hotel ; do you see any
description on here of the Boulevard Hotel?
Mr. Sullivan. I didn't mention any just now.
The Chairman. Is that operated, or was it operated, by Abe Allen-
berir ?
ORGANIZED CMME IN INTERSTATE OOIMMERCE 255
Mr. Sullivan. Well. Abe Allenberg used to operate it.
The Chairman. Well, he had a wire service there, did he not ?
Mr. Sullivan. He what I
The Chairman. He had a wire service there. You knew that,
didn't you?
]\Ir. Sullivan. I can't say, Senator.
The Chairman. Well now, you know he was at the Wofford and
then he was at the Boulevard and his gang went from one hotel to
the other with him ?
JNIr. Sullivan. I believe he managed both hotels.
The Chairman. What ?
Mr. Sullivan. I believe he managed the Wofford and the Boulevard.
The Chairman. He managed the Wofford during the time when
Costello and Adonis and all of these people were big operators?
Mr. Sullivan. It could be. I'm not aware of the fact.
The Chairman. You have seen it in the papers, have you not, the
pictures of these people in the papers, as guests, and so ferth?
JNIr. Sullivan. Yes, sir; from time to time there have been some
pictures; yes, sir. But there are all kinds of names which I have, a
number of names here, and a number of pictures. And wliile we are
speaking of the undesirable people who came into our community from
time to time and who are not committing a crime of some kind or have
not been wanted, or are not wanted in some other area or in our area,
would 3^011 or some other gentleman tell me what we can do about it ?
Our Government can't arrest them.
The Chairman. Why?
Mr. Sullivan. Because what are they wanted for? If we have got
a record on them we can pick them up. If we have a record, regard-
less of who comes in here, if we have a record and papers for him, we
Avill pick him up. If I find that he is doing something illegal I will
pick him up or have one of my men pick him up.
The Chairman. Have you read about the conspiracy to violate the
gambling laws of the State of Florida ?
Mr. Sullivan. I heard about it.
The Chairman. You have your attorney here. He has been your
attorney for quite a number of years. Hasn't he advised you about
that? He has advised you about certain laws here, matters of search
warrants. Has he advised you about the conspiracy to violate the
gambling laws of the State of Florida I About all you need are the
records of the financial investments of these big boys.
Mr. Sullivan. Well, those things. Senator, could be. However, if
they are in the operation of some form of illegal activity and so that
we can find them and arrest them, it will be done.
Now, here we had a picture painted to us yesterday of the wire
service, the interstate communications throughout our whole eastern
part of our United States, possibly in every State ; but here was this
picture here, and there have been hours and untold days of obtaining
this information.
Xow, that information was taken yesterday under oath, but why
wouldn't it be so much better if that was taken under oath publicly,
before you here, and the people of the United States to come down
here and prescribe to some oath in our local government and let us
take care of those people if they know that they are guilty of some
crime ?
256 ORGAJ^IZED CRIME IN INTERSTATE OOMME'RCE
The Chairman. Well, I suppose the people of the crime commission
have been here ready to give you any information that they can give
you.
Mr. Sullivan. Well, you suppose that, and I don't suppose that
they have. These people, Senator, have been here ready to make head-
lines in the newspapers any way and any time that they can; any-
thing to sell a sheet of paper.
The Chairman. Have you called on them for cooperation?
Mr. Sullivan. Yes, sir. What do I get ? "You are the law-enforce-
ment officer ; we're not. We are going to scandalize you and our prop-
erty owners and taxpayers of our county. We're not going to give
you nothing. We're going to run to the Miami Herald and the jMiami
Daily News with it." And you will find that I am not alone in saying
that. The people, the whole group of people sitting in the back of
us, who know Dade County, will also tell you that. Sure, I'm for law
enforcement.
The Chairman. This might be a very good place, Mr. Sullivan, to
read into the record a letter. Did you receive the original of this
letter ? I believe this is your signature and this is the return receipt
[indicating and handing same to Sheriff Sullivan] . Just say whether
you received it or not.
Mr. Sullivan. Well, you said to read this. I was seeing if I was
familiar with it.
The Chairman. I assumed that you were familiar with it.
Mr. Sullivan. I might. I put my name on anything I receive,
and I received this letter here.
The Chairman. You received the letter ?
Mr. Sullivan. This letter should be made public here.
The Chairman. That is what I was going to do, Sheriff Sullivan,
make it public. I will read the letter, or you can read it if you want to.
What is the date of the letter?
Mr. Sullivan. February 17, 1949. Yes, sir ; you read it.
Tlie Chairman. I will read it. This, apparently, is a letter dated
February 17, 1949, sent to you by the president of the Crime Commis-
sion of Greater Miami. [Reading :]
Hon. Jimmy Suixivan,
Sheriff, Dade County,
Court House, Miami, Fla.
Dear Mk. Sullivan : This letter is written pursuant to direction of the hoard
of directors of the crime commission and to explain the purpose of certain visits.
You will recall that some 4 months ago the directors of the Crime Commission
of Greater Miami invited you to meet wit)! them and you were kind enough to
accept. At that meeting the directors explained that the purpose of the crime
commission is to seek better law enforcement and more widespread respect for
laws in Dade County.
To that end we offered you and your office the full cooperation, including the
investigative facilities, of the crime commission.
In .January 1949, at the direction of our board of directors, one of our directors
called your office on the teleplione for an appointment with you. He was told
that you were out of your office at that time, so he left his name and telephone
numl)er witli the request that you call him. I understand that he has not heard
from you. Against the direction of the board of directors a committee of three
of the directors called at your office so they left their names and telephone num-
bers with your Mrs. Stewart.
The Crime Commission of Greater Miami has a large membership and also
.some 100 sponsoring organizations comprising a representative cross section of
the citizenship of Dade County. Enclosed is a pamphlet showing the names of
some of those sponsoring organizations. The crime commission can see no
ORGANIZED' CRIME IN INTERSTATE COMMERCE 257
reason why illegal gambling including bookie activities in Dade County should
not be stopped promptly and permanently. Such activities are violations of
State law and since you are the chief law-enforcement officer of the county, we
look to you for help.
We are informed that in December 1948 you gave to the present chairman of
the State Kaeing Commission a signed statement indicating that horse book-
making in r>ade (bounty was to cease inunediately and permanently. It is open
and public knowledge that these particular activities and other illegal gambling
activities are continuing and that many of the largest hotels at Miami Beach
are permitting horse-booking operations on their premises. Continued toleration
of these illegal activities will make further and more detrimental inroads on
our general law-enforcement structure. It is our duty to our members and
sponsoring organizations and to you, as sheriff, to call your attention pointedly
to these facts and to let you know that if your office is unable for any reason to
rectify them then it is our duty to inform our membership and sponsoring
organizations, also to take such measures as may best be calculated to remedy
them.
Again we offer you our sincere cooperation and invite you to call on us at
any time.
Yours very truly,
President, the Crime Commission of Greater Miami.
I suj)pose that was Col. Jack Younger. Did you say you got that
letter 'i
Mr. Sullivan. I probably got the letter. Yes, sir, I would say, yes.
The Chairman. You see the return receipt, signed by you, do you
not?
Mr. SuLLR'AN. I would say, yes. However
The Chairman. That is a pretty important letter. If you got it
one would think you ought to remember it, because they were oftering
you the facilities of their whole organization, and it represented all
the people wanting to help.
Mr. SuLLWAN. They have been to my office and never offered any-
thing like that. I am in my office just about every morning. We had
one of the gentlemen come up here yesterday morning who stated that
all the time the grand jury was in session I was out of the State, for 6
months, which you know that I couldn't be, as the chief law-enforce-
ment officer of Dade County, as the sheriff. The most that I have
ever been out of the State on a vacation was 16 days.
The Chairman. Well, Sheriff, the point is that here they say :
To that end we offered you and your office the full cooperation, including the
investigative facilities, of the crime commission.
Did you take them up on that or did you ever tell them that you
would like for them to help you? Did you ever ask them for any in-
formation ? Did you or not ?
Mr. Sullivan. In that particular letter, I don't know what haj)-
pened. I don't remember talking with them after that letter was
written.
The Chairman. Well, that has been almost a year and a half ago,
Mr. Sullivan. I understand that.
The Chairman. And they have apparently offered to help.
Mr. Sullivan. And I have publicly solicited their help also.
The Chairman. Have you asked them for any assistance?
Mr. Sullivan. I have been to their meetings, I have talked with
them. I have written them. They say, "It's your job, it isn't our job."
The Chairman. Have you asked them to furnish you with infor-
mation about
258 lORG'AXIZED CKIIME IN USTT'ER'STATE COMMEEC'E
Mr. Sullivan. Let me read a letter here.
The Chairman. Have you asked them to furnish you with infor-
mation about the Roney Plaza, the Boulevard, or any of these places I
Mr. Sullivan. I have asked them for information pertaining to
gambling in general.
The Chairman. When did you ask them ?
Mr. Sullivan. I wrote them a letter on February 5.
The Chairman. Of what year ?
Mr. Sullivan. 1950. I would like to read it.
The Chairman. All right.
Mr. Sullivan. I am going to read the entirety of this page here and
this quarter.
Your weekly scandalcast
The Chairman. To whom is the letter addressed ?
Mr. Sullivan. It is addressed to Mr. Daniel Sullivan, Director,
Crime Commission, Miami, Fla. [Reading :]
Your weekly scandalcast has come to my attention. I had been warned that
because of your activities before the current grand jury and the presence in
Miami Beach of the United States Attorney General, whom you seek to impress,
you would make your accusations and charges particularly sensational on your
weekly broadcast and news write-ups this week end. You have lived up to the
advance billing.
As the $15,000 per year scandalizer of the so-called crime commission, you
know that you are not honestly interested in suppressing crime in this county.
You know you and your organization, composed of a few anti-Sullivan people,
set out from the very first to "get" Jimmy Sullivan. You and others in your
group who suffered two successive and overwhelming defeats at the election polls
in the sheriff's race, have combined, planned, and conspired to talve over my
office by means fair or foul ; and as a part of your disgraceful program you have
broadcast every week that gambling is wide open and that the county is overrun
with thugs, crooks, gangsters, racketeers, hoodlums, thieves, triggermen, mob-
sters, and other friglitening appellations of your own invention.
These charges are pure fabrications of your own creation, and you know it.
All the local residents whom you have named as having criminal records are
has-beens so far as the law is concerned and, while they may be listed as neigh-
borhood undesirables, since they are not under prosecution or charge for any
offense, they have the same rights under the Constitution and laws that yoi; or I
have.
Not one single name have you mentioned in all your scandalmongering speeches
of an.v man in Dade County who is wanted by the law for any offense. Your
repetitious, windmill attacks against the names and records of past offenders
seem to make better and more sensational music for your deceitful purposes.
Neither do you concern yourself with the more serious social offenses, such as
larceny, rape, highway robbery, murder, manslaughter, juvenile assaults, bur-
glary, and many other high felonies. Gambling is your sole oh.iective. You and
your organization are not truly anticrime ; you ai'e anti-Sullivan, and from the
beginning you have attempted and laid plans to do what you failed to do at
the election polls — get Sullivan out of office.
If you have evidence of gambling in this county, why do you secrete It in your
files and use it only in your attempts to "get Sullivan"? If you will not place
your evidence before nie, why have you not laid it before the county solicitor,
the State attorney or one of our many warrant-issuing judges for action? If
you seek to perform an honest public service, why have you not had the courage
to use this evidence to suppress the conditions you claim to exist?
The answer is obvious. Your purpose is to take over the sheriff's office, not
to suppi-ess or eradicate crime. Through the medium of your scandalous, crime-
mongering broadcasts, you seek to influence tbe grand jury to assist you in
your hid(l(>n purpose to defeat aiul oppress nie by a back-door method, after you
lost the front-ddoi- effort at tlie election polls.
As to the mattcM's coviM-ed in your cliarges, my office is operated in strict accord-
ance with a written opinion of the attorney general of Florida, based upon the
lORGAXIZED CRIME IN INTERSTATE COMMERCE 259
laws of this State. The Slate attorney lias a copy of that opinion and if you
are interested, can prepare a copy for your use.
Lastly, let nie say that, while there may be (there always has been) a small
amount of "sneak" gambling in a few places, you, as the high-salaried "get-
Sullivan" hatchetman, well know that on the whole, considering our community
growth and tlie f;0-square-mile spread of over .lOO.OOO permanent residents and
hundreds of thousands of winter visitors, the slieriffs office has done a good
job in stippressing crime and keeping the county clean. In my entire force of
.only 95 persons, after deducting clerks, and road patrolmen, I have only 15 men
to haudle the criminal assignments, which includes woi-k in the criminal court
of record, the court of crimes, and the circuit and county judge's courts.
Divide these 15 men into working shifts, and you will understand, i>erhaps,
what we are confronted with in our efforts to serve the people of this fast-moving
county. Despite this shortage of manpower, our criminal division's record is,
second to none In the South.
A copy of this response has been mailed to Gov. Fuller Warren.
Very truly yours,
Jimmy Sttluvan, Sheriff.
The Chairman. Let me see the letter a moment. You complain
there that yon didn't have enonffh deputies or there was some shortage
of men, that you had only 15 men to do something. Here it is :
I have only 15 men to handle the criminal assignments, which includes work
in the criminal court of record, the court of crimes, and the circuit and county-
judge's courts.
Yon really need more men than that.
Mr. Sullivan. Senator, that is true. I have my road patrolmen
come in and work overtime on investigation assignments, and I have
civil men who work overtime.
The Chairman. The point is, Sheriff Sullivan, that Judge Milledge
here yesterday testified that he appointed some elisors, that is, citizens
to serve warrants, and that you brought a suit, I believe, to enjoin
their appointment.
Mr. Sullivan. No, sir, Senator; the appointments were already
made.
The Chairman. Didn't you object to them ?
Mr. Sltllivan. No.
The Chairman. You didn't object to them ?
Mv. Sullivan. I had nothing to do with an objection to the war-
rant, the service of the papers, or anything else, but the manner in
w^hich it was handled ; some law-enforcement body should have handled
it. You shouldn't go out here and get people off the street to take on
a raid of that kind, line people up against the wall and jerk a gun into
their stomachs and frighten them to death, because some of them would
nearly jump out of the window in the place.
The Chair3ian. That was an honest effort on the part of the judge
to get some help for you, wasn't it ?
Mr. Sullivan. I wouldn't say so, no; because my office was there
and we have never failed to serve one paper which the judge has issued,
if possible, in Dade County. Then w^e also have justices of the peace
and constables. We have law-enforcement officers who are expei'i-
enced in making those arrests, and if one of those papers should be
directed to me and I should fail in my duty to properly carry out
that order I would be removed from office. All the (lovernor would
have to do to remove me from office would be to say, "I suspend you
from office temporarily, until the legislature meets again."
260 ORGANIZED ORflME EST INTERSTATE OOMMERC'E
The Chairman. I notice your letter says here :
And as a part of your disgraceful program, you have broadcast every week
that gambling is wide open and that the county is overrun with thugs, crooks,
gangsters, raclieteers, hoodlums, thieves, triggermen, mobsters, and other
frightened appelations of your own invention.
These charges are pure fabrications of your own creation, and you know it.
Well, I was just looking at this chart [indicating exhibit No. 108,
a chart submitted by Mr. Daniel Sullivan]. Isn't it true that these
people have been running around here ?
Mr. Sullivan. Yes.
The Chairman. You would not want to call them the creation of
somebody's imagination if they are around here ?
Mr. Sullivan. Yes, Senator. That is just what I have been speak-
ing of just now though. When a group of people spend days, many
days, getting that information and if an arrest can be made and those
people can be taken care of before a court of justice why have not
those papers been presented where they can be taken care of ?
The Chairman. Well, Mr. Sullivan, you can't correctly say though
that these people haven't been here, that it hasn't been public knowledge
that they have been here. I have seen Miami papers during the past
6 or 8 months with their pictures in them showing that they were regis-
tered in hotels here. You can't say that is just pure fabrication or
the creation of somebody's imagination, can you? I mean, that is
liardly correct. If these people are hanging around here every year,
why, that is not pure fabrication of "your own creation," is it?
Mr. Sullivan. Senator, we have several hundred thousand people
who come down here in the wintertime and it is impossible — we in
every way invite as many people as we can to come to Dade County
in the wintertime and the year round, particularly when the horse
races are going — we have three horse races going here in this area
and one of them in Broward County. We get as many people down
here as we can.
The Chairman. I know that Sheriff Sullivan, but you don't want
these people [indicating chart] down here, do you?
Mr. Sullivan. We don't want these people down here.
The Chairman. It has been quite common knowledge to anyone
who knows anything at all that these people have been here every
season.
Mr. Sullivan. Suppose we do this. Senator. Suppose if we have
something that we can do about them we go to the law-enforcement
officers and say, "Let's arrest these fellows. We have investigated and
find we can arrest them on this type of charge" instead of goin^ down
to our newspapers and saying, "This is what you see in Dade County.
Be careful in walking down the street because somebody will strike
a knife in you" ? Wouldn't that be better ?
We got many thousands of property owners, and some of them are
big property owners who pay big taxes to operate our county. We
have the fastest-growing area perhaps in the United States.
The Chairman. Let us get back to tliis other point. With all these
people here you say, "Wouldn't it be better to let you know they are
here rather than putting it in the newspapers." I asume it has been
goincr on for a long time and it is common knowledge that tliese
people are here and that many of them have been operating various
lORGAJSnZED CHIME IN mTEUSTATE OOMMEROE 261
things, illegal operations. What good would that information do
if it was turned over to you ? I suppose as a last resort, feeling noth-
ing else had happened, they put it in the newspapers.
Mr. Sullivan. Well, if the newspapers are for you it is one pic-
ture and if they are against you it is another picture. You know
that. Senator. You are well aware of that fact. If you run for office
you find that out and I happen to know.
The Chairman. So you don't think the newspapers are in favor
of law enforcement, in getting these criminals and arresting them and
bringing them to justice and getting them out of town? You don't
think they are in favor of it?
Mr. Sullivan. They are.
The Chairman. Why do you condemn their efforts in that respect
then ?
Mr. Sullivan. I am in favor of it just as much as they are. I work
just as hard as they work and I have my entire force working hard.
The Chairman. But nothing has happened ; isn't that the point ?
Mr. Sullivan. Well, you just saw 272 or 279 of them were sent
to our prison here last year.
The Chairman. I didn't see any of those names on there [indi-
cating charts].
Go ahead with your statement, Mr. Sullivan. I didn't mean to
get into an argument with you.
Mr. Sullivan. Senator, in regard to what you spoke of a minute
ago as to the elisor raids
The Chairman. Yes.
Mr. Sullivan. This case was brought by Jimmy Sullivan, as sheriff
of Dade County, Fla., against Stanley Milledge, as one of the judges
of our Circuit Court of Dade County
The Chairman. Then you did bring a suit?
Mr. Sullivan. Yes, sir.
The Chairman. I thought your counsel said no suit was brought?
Mr. Hunt. Counsel never said that because counsel brought the suit.
The Chairman. I see.
Mr. Sullivan. The suit was brought to show cause, to show the
cause why my office was not called on to serve these processes. It is
my duty to do that and if I fail one time let them put me out of office
legally through our State channels which they can do, but I don't
believe that— I don't know just what happened in that case. One of
the fellows who was working there when this took place was also one
of the elisors who was appointed elisor.
The Chairman. Anyway, an elisor was appointed by Judge
Milledge?
Mr. Sullivan. Yes, sir.
The Chairman. Judge Milledge has a very good record of trying to
enforce the law.
Mr. Sullivan. Yes, sir. He is a very fine fellow.
The Chairman. If there wasn't any question that he had to appoint
an elisor, how about the sheriff's office?
Mr. Sullivan. No.
The Chairman. Did he appoint an elisor or not?
Mr. Sullivan. Senator, he appointed an elisor but not to help out
the sheriff's office. We were there to serve the papers.
262 iORG.^XIZED GRUME EST ESTTER'STATE OOMME'RCE
The Chairman. Will you explain that any way yon want?
Mr. Hunt. Let me present, Senator, a copy of the bill for declara-
tory decree which will present the legal issnes as they were plead in
conrt [handing document to the chairman].
The Chairman. May we have this for the record ?
Mr. Hunt. Yes, sir. I am giving it to yon for the record.
The Chairman. I see this is a long order, Mr. Hunt. Why don't
you explain what the orders says to save time ? "W'liat was the result
of the order?
Mr. Hunt. The order, signed by four of the circuit conrt judges,
Judge Milledge excepted, holds two things, that —
All process, except that issuing from a justice of the peace court, shall he
served by the sheriff or any constable of the county in the district in which it is
to be served. Process of a justice of the peace court may be served by a sheriff
of the county or by a constable. A justice of the peace or a constable in the re-
spective counties, may serve all process in cases where the sheriff is interested,
and in case of necessity the judge of the circuit court may appoint an elisor to
act instead of the sheriff.
And it was held in this opinion by these four judges that it was
improper to go over the head, that it was improper for a circuit court
judge to go over the heads not only of the sheriff but the constitu-
tionally elected and appointed justices of the peace and constables pro-
vided under this law and to appoint a private individual to strap a gun
on him and go raiding.
That is the purport of it. It did dismiss the bill upon tlie ground
that such an action could not be maintained under the Florida dec-
laratory decree statute.
The Chairman. Well, the bill that w^as dismissed
Mr. Hunt. AVas the one I presented.
The Chairman. Was Sheriff Sullivan's bill ?
Mr. Hunt. That is right.
The Chairman. So, there wasn't any decision here as to whether
Mr. Hunt. You have three pages of such decision as I have just
quoted.
The Chairman. Well, this just states the law and then just says that
Sheriff Sullivan's bill for some jurisdictional reason has to be dis-
missed.
Mr. Hunt. That latter part is correct.
The Chairman. We will mark this as an exhibit. (Bill for De-
claratory Decree, and opinion and order, referred to above, was
marked "Exhibit No. lo6," and appears in tlie appendix on pp. 770-
777.) Anything else. Sheriff?
Mr. Sullivan. Senator, we have here some of the things of which
you lieard yesterday. These are the records of some of the people,
their past records, who live on Miami Beach or in different parts of
Dade County [indicating file].
The Chairman. You are talking about some of the S. & G. people?
Mr. Sullivan. Well, I am talking about the people we have
records of. It could be. I don't know. It is possible.
I am speaking now of this Charles Fischetti who lives on Allison
Road, INIiami Beach, and whose plione is not published and is in his
wife's name. His wife is a registered voter. The taxes are ])aid
by Ami Fischetti. The gas is paid by Ann Fischetti. The water
is paid by Ann Fischetti and the lights are paid by Ann Fischetti.
ORGANIZED CRIME IN INTERSTATE OOlVIMERCiE 263
The gas was paid since January 9, 1939, and tlie lights were paid
since October 10. 1939.
Mr. Hunt. Go to the next one.
Mr. SuLLivAX. The next one is Joe Massei, who lives at 1062
Northwest Twenty-second Street, who receives his mail there, rather,
in care of the INIiami Provision Co., phone, 2-8113, and his residence
is the Grand Hotel, 2220 Twenty-third Street, Miami Beach, ])hone,
56813; no voter's registration; taxes on 1062 Northwest Twenty-
second Street paid by Miami Feed & Supply Co., located at 1038
Northwest Twenty-first Terrace. Lights in the name of Joseph
Miller, wholesale meat business; taxes on 220 Twenty-third Street,
Miami Beach, paid by Polkin, Inc; lights on 220 Twenty -third
Street, Miami Beacli, paid by John G. Lux since September 30, 1919.
Here is Sam Taran who has been in local skirmishes here from
time to time. He lives at 6520 Allison Road, Miami Beach. The
])hone is 86-1903 and 86-6986. His wife is Diane and brother is
F. H. Taran; Taran Distributors, Inc., 2820 Northwest Seventh
Avenue; Sam Taran, president; Taran Television, phone 3-7618.
Registered voter. Taxes paid by S. H. Taran; gas paid by S. H.
Taran since December 3, 1915 ; water paid by S. H. Taran since
December 3, 1915 and lights paid by S. H. Taran since December
3, 1945.
The Chairman. How many do you have there ?
Mr. Sullivan. Senator, the point
The Chairman. The point is you prove that they are property
owners ?
Mr. Sullivan. Yes, sir.
The Chairman. Will you file these as an exhibit to your testi-
mony^ The committee will be glad to have the information.
(Photographs and criminal records submitted by Sheriff Sullivan
were nuirked ''Exhibit No. 137," on file with committee.)
Are those the identifications of them?
Mr. Sullivan. Yes, sir. And also some more pictures of some
[handing photographs to the chairman].
The Chairman. I see you have a picture of Mickey Cohen and his
body guards.
Mr. Sullivan. You will be interested in this I am sure. We have
these and records for these people here [handing documents to the
chairman].
The Chairman. The first picture you hand me is the home of
John Angersola.
(Exhibit No. 138, see appendix, p. 777.)
Mr. Sullivan. Yes, sir. And, here is another picture of John
Angersola [handing photograph to the chairman].
(Exhibit No. 137 on file with committee.)
Mr. Sullivan. Here is a picture of Sam Taran's home [handing
photograph to the chairman].
The Chairman. It will l>e made an exhibit to your testimony.
(Exhibit No. 139, see appendix, p. 778.)
Mr. Sullivan. Here is a picture of Sam Taran's place of business.
(Exhibit No. 137 on file with committee.)
The Chairman. What kind of disiributing company is that ?
Mr. Sullivan. It is listed on the back there. It is a meat-distribut-
ing business, I believe.
68958— 50— pt. 1 18
264 ORGANIZED ORfEyTE IN INTERSTATE OO'MME'R'C'E
Here is Ralph Buglio, 261 North Coconut Lane, Pahn Island [hand-
ing photograph to chairman].
The Chairman. It will be made part of the record.
(Exhibit No. 140, see appendix, p. 778.)
Mr. Sullivan. Here is one of Joe Massei of the Grand Hotel [hand-
ing photograph to the chairman].
The Chairman. Is that the Grand Hotel on Twenty-third Street,
Miami Beach?
Mr. Sullivan. Yes, sir.
The Chairman. He doesn't own the Grand Hotel, does he ? He just
occupies it just with somebody else?
Mr. Sullivan. Well, he is thi!re. They claim that he is one of the
owners.
Joe Massei at 1062 Northwest Twenty-second Street. There is his
provision place there [handing photograph to the chairman].
The Chairman. It will be made a part of the record (exhibit No.
137).
Mr. Sullivan. There is Martin Leo Accardo.
(Home of Martin Leo Accardo, exhibit No. 141, see appendix, p. 779.)
Mr. Sullivan. There is Charles Fischetti over there [indicating
and handing photographs to the chairman].
(Home of Charles Fischetti, exhibit No. 142, see appendix, p. 779.)
The Chairman. Some of them have mighty big residences, don't
they ?
Mr. Sullivan. Yes, sir.
The Chairman. This is Charles Fischetti ? You have been talking
about him. He is the Charles Fischetti from Chicago ?
Mr. Sullivan. Yes, sir. Here is Tony Accardo [handing photo-
graph to the chairman] .
(Home of Tony Accardo, exhibit No. 143, see appendix, p. 780.)
The Chairman. How come you have these pictures ? Wliat did you
take these pictures for?
Mr, Sullivan. Well, I was trying to find out what I would be able
to do with them.
The Chairman. So, that when the committee came you thought
it would be a good idea to show them.
Mr. Hunt. I don't think that is
Tlie Chairman. I didn't mean to make any disparaging remarks.
Mr. Sullivan. I was trying to find out what I could do with the un-
desirable people that are here with their pictures and records that we
have of them. HoweA^er, so far we only have photographs of these
fellows and can't arrest them because we don't have anything that we
can arrest them for.
It has been suggested by some people that I go out and pick them
up and put them in jail. I am under a $25,000 bond. If I go out and
start putting people in jail for no reason wliatsoever I am on my bond.
I have got to find some charge or another to arrest these people for.
I got to have some charge that will stick. If I were able to employ a
lot of outside men well then I might be able to find out some more stuff
that is not actual crimes.
The Chairman, Are these slips with the descriptions you have been
reading from for the use of the committee ?
Mr, Sullivan, Yes, sir.
The Chairman, Can you give us those descriptions ?
ORGANIZED CRIME IN INT'EKSTATE OOMMERCE 265
Mr. Sullivan. Yes, sir [handing documents to the chairman].
Tlie Chaikman. Let them be filed as exhibits to Sheriff Sullivan's
testimony.
(Exhibit No. 137, on file with committee.)
The Chairman. You had here a picture of Mickey Cohen and three
body guards. What did you do with that? Is that just a record?
Mr. Sullivan. This is a file that we have here [indicating] from
which we try to find out if we have a record on these men or that we
can place somthing against them; we don't want them here at all, a
bit more than somebody else wants them in this State or in their State
if they are trying to commit a crime. In fact, we don't want them here
period. But how are we going to get them out if they have not com-
mitted a crime or are wanted for some other charge ?
We have pictures of all these criminals here and we have FBI
records on them.
The Chairman. Let me have that Mickey Cohen picture.
Mr. Sullivan. Yes, sir [handing photograph to the chairman].
These pictures go with the records there [indicating].
The Chairman. All right, we will attach them to the record.
(Photograph referred to is included in exhibit No. 137, on file with
the committee. )
Mr. Sullivan. Now, here is a record of a local fellow who is an
undesirable man who has been arrested here many times and taken into
court. Every time you take him he gets out. He has been arrested in
other places many times.
Mr. Hunt. What is his name ?
Mr. Sullivan. His name is John Nahas and he has been arrested
for armed robbery, conspiracy to violate the Prohibition Act, arrested
by State troopers and admitted to the Federal penitentiary, arrested
for vagrancy, assault and battery; investigation receiving stolen prop-
erty, investigation operation of bawdy house; investigation of pro-
curer of bawdy house and prostitution ; operating house of prostitu-
tion ; operating house of ill fame.
Quite a number of these are not in Miami. They are in Michigan.
They are in Indiana. They are in Kansas. They are in Illinois and
there are several other States that they are in.
Mr. Hunt. You want to put that in ?
The Chairman. Yes ; put; that in the record.
(Exhibit No. 137, on file with committee.)
The Chairman. Sheriff Sullivan, we are going to have a very short
recess at this time. We hoped that Mr. Harry Russell would be here.
That matter, therefore, will be deferred.
The committee will take a 5-minute recess.
(A short recess was taken.)
The Chairman. All right. Sheriff, do you have any other records?
Mr. Sullivan. Yes ; I do have. I have the balance of these records
of which we were speaking of at the present time.
Anyway, at the time we get the finger prints or pictures of these
people we get their records and if we can make an arrest we make the
arrest. We have these pictures where we can help other law-enforce-
ment agencies and the Federal Bureau in Washington which we have
and they don't have.
266 lORG'ANIZED ORIIME IX IIS-^T ERST ATE OOMMERCE
The Chairman. A lot of the complaints, as a matter of fact, that
have seen sent here came from other county law-enforcement officers
or States and what not, didn't they ?
Mr. Sullivan. Yes, sir.
The Chairman. That information was furnished to you by them.
]Mr. Sullivan. That is true.
The Chairman. You put anything you have there in the record,
Sheriff Sullivan.
Mr. Sullivan. We have a record of a man which came up here
yesterday for quite a discussion while this matter was being pre-
sented, this Sam Millman. His address, his local address is 2609
Collins Avenue, Miami Beach, and his place of arrest was at Northwest
Thirty-sixth Street and Thirteenth Avenue, one block east of the Club
36. He was arrested by one of our men, George Patton at 3 : 35 a. m.
on May 5, 1950. The above subject was arrested along with Moe
Rockfeld on suspicion of jewel robbery. He was held for investiga-
tion and later put into a lineup for identification. People failed to
identify the subject. Further investigation revealed that subject had
a record. The subject was charged with "Failure to register criminal
record.'' He was tried in the court of crimes on June 2, 1950, and was
found not guilty. FBI record attached. "This Millman, a partner
of Moe Rockfeld,'- that is the notation on here and his FBI record is
put in and the last few times that he was arrested. His last time out
of the State was December 30, 1943, in Jackson, Mich. He was
charged with conspiracy to obstruct and impede justice and on June
28, 1945, he was paroled to Detroit, Mich., to serve balance of term
and on January 10, 1918. he was discharged from parole.
We arrested him twice here, once at Miami Beach on March 2, 1950,
for criminal registration with the sheriff's office, Miami, Fhi.. and we
arrested him which I quoted on May 5, 1950, for investigation for which
he was recently released.
That is the only thing that we do when we do have no charge against
them if the people who come to see them and identify can't say he has
committed a crime. If we can find out or if people will help us
instead of saying, "You go out and get it," that would help.
The Chairman. There is a statute requiring registration by any
people, or, requiring the registration of any people with a criminal
record.
Mr. Sullivan. Felonies.
The Chairman. Felony records ?
Mv. Sullivan. Felony records ; yes, sir.
The Chairman. You just couldn't prove that he was the one that
committed that offense in Michigan ?
Mr, Sullivan. He was registered previously with our office and
also on Miami Beach for a felony record.
And the case of Moe Rockfeld :
The following subject is described by the local newspapers and by the crime
commission as a notorious Detroit and Chicago hoodlum. Moe Rockfeld, alias
Morris Rockfeld; male white; age 44; address, local, 2(500 Collins Avenue, Miami
Beach, Fla. IMace of arrest. Northwest Thirty-sixth Street and Thirteenth Ave-
nue, about one block east of Club 36. Arrested by George Patton. Time, 3: 35
a. m. on May 5, 1050.
The above subject was arrested along with Sam Millman on suspicion of jewel
robbery and booked into tiie county jail. Subject was later put into a line-up and
victims failed to identify him.
lORGANIZED CRIME IN INTERSTATE COMMERCE 267
The subject was later charged with vagrancy and tried in court of crimes in
absentia and found not guilty.
He was tried in the court of crimes by his attorney. He was not
there and his attorney pleaded for him in absentia, and he was found
not guihy. That was on June 7, 1950.
Now we have. Senator, these people who come here and they are
not wasted, see? If any officer would arrest them or if any law-
enforcement office can arrest them we \vould be happy because we con-
sider it all right. Any time we get hold of a notorious character we
lock him up. I know any one of my men would be very happy to do
that. They think they have done something. They think it is a feather
in their cap, and I always try to impress the importance of that. I try
to do something for them to encourage it more.
That is one of the main things that our papers should do in a case
of that kind.
The Chairman. Mr. Sullivan
Mrr Sullivan. Any time our men go out and perform some out-
standing duty for the good of the community the}^ should be praised
for it greatly. They are just human beings, just like other people,
and you can do a lot more with them if you try to help them insteacl
of knocking them down every time a chance comes along to do that.
Here is a picture of Joseph Adonis, alias Doto, and his FBI record,
which I am going to turn over here. The last time Joseph Adonis was
arrested was May 9, 19-iO, by the police department in New York. It
doesn't say "Released" here. It says, "No longer wanted as Joe
Adonis. Subject arrested an.d released." "No longer wanted," see?
Now, this is one of the fello-ws here that we received a tremendous
amount of very, very bad publicity on from time to time. He is from
time to time in our area, and I tell you that that stuff in our news-
l^ajiers doesn't do our town no good.
The Chairman. Is he registered with you, Joe Adonis?
Mr. Sullivan. Only in that manner. Senator.
The Chairman. I mean, did he file his felony registration here in
this county ?
Mr. Sullivan. Joe Adonis has not filed in our county, I mean, in
our sheriff's office. We have records of these following men and Joe
Adonis.
Frankly, Senator, I can't tell you whether he has filed with us for
his criminal record. I would say that he has. I don't know if it is
with the city of Miami or the city of JNIiami Beach.
This office has records of criminals, criminal records of the following
men:
Ralph Buglio, Joe Massei, alias Joe Massey, Sam Taran, Frank
Erickson, Joe Adonis, Frank Costello, Anthony Carfano, Charles Fis-
chetti, Moe Rockfeld, alias Morris Rockfeld, Samuel Millman, Jimmie
Sakelaris (Taran's partner), Isadore Blumenfield, alias Kid Cann,
Nick Kokenos
The Chairman. You mean, these people have filed their felony
registrations with you?
Mr. Sullivan. We have records of these.
The Chairman. Everybody has records. Do you have felony regis-
tration certificates on these?
Mr. Sullivan. Of these.
268 lORGAJSnZE'D CEIIME IN INTERSTATE COMMERCE
The Chairman. You do have ?
Mr. Sullivan. I am sure we have the ones of these [indicating],
but we don't have the ones for these [indicating].
This office has criminal records of the following-named men
[indicating].
The Chairman. What do you mean by that? You have their
pictures
Mr. Sullivan. FBI record.
The Chairman. And their slip ?
Mr. Sullivan. Yes, sir.
The Chairman. But I was asking about the record they are re-
quired to file when they register when they come in.
Mr. Sullivan. That definitely I can't tell you. It will be in my
office if we have it.
The Chairman. That is very important, isn't it?
Mr. Sullivan. We have a number of them. Here is one that was
booked at 11 a. m. on February 28, 1947, in the sheriff's office, Paul
Pancsko. He was released on a writ of habeas corpus on March 2,
1947, by order of one of our circuit court judges. This is the gentle-
man [handing photograph to the chairman].
The Chairman. I have seen his picture before. Let's get these
into the record as quickly as we can. Sheriff.
(Photographs and records referred to above are included in exhibit
No. 137, on file with committee.)
Mr. Sullivan. Yes, sir. We have about 285,000 classifications in our
office upstairs on the nineteenth floor.
Here is Paul Labriola that was mentioned here. He was booked in
the sheriff's office on February 28, 1947, and was released on a writ of
habeas corpus by one of our circuit court judges [handing photogi'aph
to the chairman] .
The Chairman. All right, it will be filed. (Exhibit No. 137.)
Mr. Sullivan. I got two of those there. I got three right together
[handing photographs to the chairman].
The Chairman. They will be filed. (Exhibit No. 137.)
Mr. Sullivan. This one, John Kay, was booked by our office and
released on a writ of habeas corpus on February 28, 1947. Nick
Kokenes was booked on February 28. 1947, and was released on March
2, 1947, on a writ of habeas corpus [handing photographs to the chair-
man].
The Chairman. That will be filed in the record. ( Exhibit No. 137. )
Mr. Sullivan. Senator, I think it is very important to bring these
things to your attention, the work that our office does in the county
and also in trying to relieve the community of undesirable elements.
Here is a letter from the Sevier County circuit court :
In I'eply to the telegram received this day from Western Union in regard to
George Laris stating his case number in circuit court 356.
I have checked my records and I find that case No. 356 in the circuit court
of Sevier County, Tenn., was styled: State of Tennessee v. Jimmie Sakelaris,
alias, who was indicted in the circuit court of Sevier County, Tenn., Mai'ch 2, 1937,
for arson, and he was tried and convicted in the circuit court of Sevier County,
Tenn., on July 12 and 13, 1937, a motion for new trial was made by the defendant
whicli motion was heard by tlie court on July 14, 1947, and the court overruled
said motion for new trial ; the defendant appealed his case to the Supreme
Court of Tennessee, sitting at Knoxville, Tenn., which appeal was perfected by
the defendant and his counsel and pending the appeal the defendant, as I under-
stand the record, got a pardon from the Governor of the State of Tennessee.
ORGANIZED CRIME IN INTERSTATE COMMERCE 269
So far as the records In my office are concerned in regard to case No. 356, the
defendant, Jimmie Sakelaris, alias, was convicted for arson in the circuit court
of Sevier County, Tenn., and appealed to the supreme court sitting at Knoxville,
Tenn., which appeal was perfected so far as my records are c<mcerned.
If you desire a certified copy of the proceedings as they appear on record in
my office in Sevier County, Tenn., I will be glad to furnish same but I believe
that you would get a more complete record by getting in touch with the clerk
of the supreme court at Knoxville, Tenn., as to the complete i-ecord and also as to
the pardon granted by the Governor of the State of Tennessee.
Yours truly,
H. T. Ogle,
Circuit Court Clerk.
The Chairmai^. May I see it ?
Mr. Sullivan. Yes, sir [hanclino; letter to tlie chairman].
Mr. Hunt. Is the record attached?
Mr. SuTiLivAN. Yes, sir.
The Chairman. It will be filed as an exhibit (exhibit No. 144).
Did he file his felony certificate with you ?
Mr. Sullivan. That, Senator, I can't tell you. I can have that
checked, yes, sir. However, there is a law here in the State of Florida
that is compulsory within 10 years. Here is the last current record
of Frank Costello. This individual form is what we send up there
to find out about Frank Costello. The arrest was made here on this.
We found out that Frank Costello, and they said his record and that
of Frank Saverio were identical. They were the same as the arrest
that was made in New York City of Costello and Saverio.
The Chairman. So you have "his record. What did you do with it?
Mr. Sullivan. This is not the record. This is the form that was
sent up there with the letter to the FBI in Washington to try to get
the information to see if he was wanted for something or another, after
the arrest was made here in Dade County. This is the last known
address of Frank Costello.
This is another one: Frank Erickson. The last time he was ar-
rested here, June 8, 1939, at Queens for perjury, second degree.
The Chairman. In 1939.
Mr. Sullivan. Yes, sir. His case was appealed and the defendant
was released on certificate of reasonable doubt, and $2,500 bond, Judge
Mayes of the supreme court in 1940.
This is additional stuff of Frank Erickson.
The Chairman. Well, Mr. Sullivan
Mr. Sullivan. Yes, sir ?
The Chairman. We know that there should have been records on all
of these people. We don't want to keep all your records here that you
have. What are you trying to establish by putting all of this in the
record like that?
Mr. Hunt. May I say that the charge has been made, and he has
done the best he can to establish the validity of these charges.
The Chairman. Here, Frank Costello's record of an arrest in
1939
Mr. Hunt. You have to write off
The Chairman. I don't see what 1939 has to do with the current
year.
Mr. Sullivan. Well, I think that up to that time when we got this
letter, when he had this last skirmish with the law ; that is, the last
time he was arrested
270 ORGANIZED CRIIME IN INTERSTATE COMMERCE
Mr. Halley. May I ask that the point that is being brought up
here — the job of writing and getting certain police records, every police
station in the United States has done that and does that. Is that
what yon are driving at ?
Mr. Sullivan. No, that has nothing to do with that.
Mr. Halley. I don't see the relevancy.
The Chairman. Anyway, let's go on here and get any others that
you have here.
Now, are these your original records? We don't want you to de-
prive yourself the use of them,
Mr. Sullivan. These were the FBI records which we have obtained.
They are obtained by each law enforcement department in case they
have inquiries for this or that case. In that case we pick the man up
and see what additional charges he has, and what he is wanted for.
These charges we got, the most of them are all of people whom we
arrested and were in custody for some charge or another.
If the chairman would like to have these records, here is a little pre-
sentment that I would also just like to show. I would like to show you
the working of our office for 3 montlis. Of course that don't cover
this year. That covers the year 1946, right after I had been sheriff
for 1 year.
The Chairman. Well, can we have that made a part of the record
also?
Mr. Sullivan. Yes, sir.
(Record of Sheriff Sullivan's office for 3 months, second quarter
of 1946, was marked "Exhibit No. 145" and appears in the appendix
on p. 781.)
Mr. Sullivan. That is all for the present time.
The Chairman. Is there anything else, Mr. Sullivan, that you want
to bring out ?
Mr. Sullivan. Senator, I don't have anything to present at the
present ; no, sir.
The Chairman. I think I should say by way of explanation that
the papers that Mr. Sullivan has handed me here are for the second
quarter of 1946, 3 months. The various arrests are for all kinds of
things. The total for those months is 1,721, which are for health
violations; violations of beverage laws; and drunken driving, and
reckless driving.
Mr. Sullivan. Senator, you will also notice the gambling cases that
were brought in, and arrests made at that date ?
The Chairman. The total is 130 during those 3 months. There are
cases of drunkenness, delinquent children, and so forth.
Mr. SuT.LiVAN. Well, I think this will show you our arrests for
operating gambling places.
The Chairman. Mr. Sullivan, just before we recess for lunch, these
FBI records, any law enforcement officer can get them by writing
for them, and they send some of them out themselves. Also if you
send a finger]:)rint in to the FBI, they automatically send you the
record ; is that correct?
Mr. Sullivan. Yes, that is true, yes, it is.
The Chairman. Do you have a record of the number of finger-
prints you liave sent in to the FBI?
Mr. Sullivan. I believe in our records there we do have. It is
listed in the records at the office.
ORGANIZED CRIME IN INTERSTATE OOJVIMERCE 271
The Chairman. Do you know how many there were ?
Mr. Sullivan. Well, I don't know off-hand; no, I don't. On each
record of our yearly record from the office it is on.
The Chairman. Do you have a record on Harry Russell, Jules
Levitt, Eddie Rosenbaum, Charles Friedman, and Harold Salvey?
Mr. Sullivan. If we have records of them there, they were not in
here. ^
The Chairman. Was it well known that they operated the S. & G.
Syndicate here in Dade County ?
Mr. Sullivan. They are probably the S. & G. Syndicate operators.
The Chairman. What do you mean, "probably," Sheriff?
Mr. Sullivan. That is what I mean, probably, because I can't say
definitely; because I don't positively know, but they probably are,
from the many, many reports that we have, and the many arrests
that we have made which their attorneys or bondsmen come in and
make a bond or try to spring the witnesses.
The Chairman. What are some of the things that make you think
they probably are?
Mr. Sullivan. Well, as I say, the arrests that we make and the
rumors that go around, and the gossip that goes around — which it
does.
The Chairman. Do you mean some little bookie working for
them gets caught and their attorney comes in and makes a bond ; is
that what you mean ?
Mr. Sullivan. Well that is one of the many things, yes, sir.
The Chairman. What investigations did you make of this?
Mr. Sullivan. We have raided at times, a number of the S. & G.
exchanges, and the only way we know it is the S. & G. is the people
who make the bonds, and the attorneys who represented them.
The Chairman. Did you get any of these people in when you
raided ?
Mr. Sullivan. Apparently they have never been found at any
one of the gambling places that we have raided and arrested anyone.
As I understand, ])eople of the syndicate are not frequent visitors of
any gambling establishment.
The Chairman. How about their books and records ?
Mr. Sullivan. I mean when
The Chairman. Have you made an investigation of them?
Mr. Sullivan. I don't believe that my office has that power to do
that. That is the power of our State's attorney. I believe that our
county solicitor hasn't the power; however, he has the power to
subpena them in.
The Chairman, All right. Do you have any other general state-
ment you want to make, Sheriff Sullivan? We are going to recess
pretty soon.
Mv. Sullivan. No, I was just speaking of what you asked me.
The Chairman. It is 12 : 30 now. I think the committee will stand
in recess until 1 : 15 this afternoon. It is quite apparent that we
\\ ill have to get along very much faster than we have this morning.
We will stand in recess until 1 : 15.
(Thereupon a recess was taken until 1 : 15 p. m.)
272 ORGANIZED CRIME IN mT'ERSTATE OOMME'RC'E
AFTERNOON SESSION
(Hearing resumed at 1 : 27 p. m., July 14, 1950.)
The Chairman. I think, in order that Sheriff Sullivan may have
any evidence that pertains to him before the committee before he
finishes his testimony, that in fairness all the way around, since
we have two other witnesses that have something to say about the
sheriff's office, it would be best to call them before he resumes his
testimony.
Mr. Hunt. Very well.
The Chairman. Is Deputy Sheriff Hawkins in the courtroom ?
( No response. )
The Chairman. Is Deputy Sheriff Hawkins in the committee
room ?
(No response.)
The Chairman. We would like to have deputy sheriff called, if
some one of the committee's staff will have him called.
Mr. Hunt. We will be glad to call him.
TESTIMONY OF S. R. FULFORD, POLICEMAN, TOWN OF MIAMI
BEACH, FLA.
The Chair3Ian. Mr. Fulford, do you solemnly swear that the testi-
mony you will give this commitee will be the whole truth and nothing
but the truth, so help you God ?
]\Ir. Fulford. I do.
The Chairman. Will you proceed with the questioning of Mr.
Fulford?
Mr. Halle Y. Mr. Fulford, were you ever on the staff of the sheriff
of Dade County, Fla. ?
Mr. Fulford. I was.
Mr, Halley. During what time ?
Mr. Fulford. From the 1st of July 1943 until November 1, 1947.
Mr. Halley. In what capacity did you serve ?
Mr. Fulford. I served as a deputy sheriff.
Mr. Halley. You served as a deputy sheriff ?
Mr. Fltlford. Yes.
Mr. Halley. ^Yhilt were your duties ?
Mr. Fltlford, Well, when I went with the sheriff's office I served
a number of months on the road patrol; then I served up there on
the desk, dispatching and taking care of the jail at night; I did that
for a month, I believe, and then I went from there to the civil depart-
ment where I was at the time I resigned on October 25, 1947.
Mr. Halley. "Wliat have you been doing since ?
Mr. Fulford. I am a policeman for the town of North INIiami.
Mr. Halley. Have you been in that job ever since you left the
sheriff^'s office?
ISIr. Fulford. Yes.
IVIr. Halley. Do you know a man by the name of Hodges ?
Mr. Fulford. Yes; I do,
Mr. Halley. Do you know whether there is any family relationship
between Thomas Hodges and Deputy Sheriff Burke?
ORGANIZED CR'IME IIST INTERSTATE COMMERCE 273
Mr. FuLFORD. Nothing more than what a lady told me who was
working out of this restaurant on North River Drive. She said that
he was a brother-in-law of Tom Burke.
Mr. Halley. Who was the lady ?
Mr. FuLFORD. She said she was Mrs. Hodges.
Mr. Halley. About when did you speak to this lady you are talking
about, Mrs. Hodges?
Mr. FuLFORD. It was sometime in the summer of 1947.
Mr. Halley. In the summer of 1947?
Mr. FuLFORD. Yes. It may have been late spring; it was during
that, thought ; it was before July, 1947.
Mr. HalT;EY. Did you stop at this restaurant run by Mr. and Mrs.
Hodges at that time?
Mr. FuLFORD. I stopped at this restaurant where the lady identified
herself as Mrs. Hodges worked.
Mr. Halley. How did you happen to stop there ?
Mr. FuLFORD. I went out there to pick up an automobile on a court
order, and in returning I asked my partner if he w^anted to stop and
get something to eat. He said, "Yes, I am hungry, too." I said,
"Let's stop at Pop Ley's place.'' The last time I was in this place it
was operated by Mr. Ley ; he is known as Pop Ley.
Mr." Halley. What is your partner's name ?
Mr. Fulford. At that time it was Mr. Goldman.
Mr. Halley. What is his name?
Mr. Fulford. Abe.
Mr. Halley. A-b-e?
' Mr. Fulford. That's right.
Mr. Halley. Is he still in the sheriff's office ?
Mr. Fulford. No, sir.
Mr. Halley. Mr. Fulford, what happened when you stopped at
this restaurant?
Mr. Fulford. We went in and sat down at a counter, and this lady
came by and she took our order. I asked for Mr. Ley and she said he
wasn't there any more, that he had moved. So we ordered some barbe-
cued ribs, and in the meantime she came out and there was a conver-
sation between her and Mr. Goldman. She asked us if we were detec-
tives and Goldman asked her why she asked that, and she said, "You
look like it." So we told her we were from the sheriff's office, in the
civil department, and she said, "I have a brother-in-law" — that lady
Avho a few minutes before had identified herself that she was Mrs.
Hodges, said that she was the wife of Mr. Hodges and that Mr. Hodges
was a brother-in-law of Mr. Burke. I said, "Who; that old man?"
and she said, "You better not call him old." That was the end of our
conversation while we were there at that time.
Mr. Halley. W^iat happened next after that?
Mr. Fulford. We came to the office, and either that day or the fol-
lowing day the chief of the criminal division sent for us to come up.
Mr. Harkness, who was then chief of the civil department, told us
that Mr. Hawkins wanted to see us. So Goldman and I went up to
see him, and he asked me what were we doing out there at this bookie
joint, and I said, "What bookie joint." He said, "Do what you ought
to do, but not go back down there." He said we were out there in
that restaurant. I asked him where he got his information from and
he said he got it from Mr. Burke.
274 lORGANIZE'D CRIIME IN ESTTE ESTATE COMMERCE
Mr. Halley. What happened next ?
Mr. FuLFORD. The following day after limch I was standing in the
door of the civil department when Mr. Burke came along. I called
to him and he said, "What do you want," so I walked up to him and
hit him on the shoulder and took him into the office and I asked liim
why he was going around trying to start something about where I
stopped to eat. I said to him, "I will eat anywhere I want to eat so
long as I have the money to pay for it." I said furthermore, "I would
like for you to keep out of my business, because if you don't" — Captain
Buford who at that time was chief deputy
Mr. Halley. Wliat is his name ?
Mr. FuLFORD. Buford. I said to Burke, "If you don't keep out of
my business I will stomp the hell out of you, and I will eat anywhere
1 like to eat." Likewise I told Mr. Hawkins. So I guess Mr. Burke
decided that I w\as possibly upset and intended to try it, so he moved
off and quieted down, and then he wanted to talk. I said to him, "I
didn't know there was a bookie joint out there. I stopped in that
restaurant to eat." He said, "Well, it is out there for you and if you
don't get it it is your own damn fault. If you can't get it there I can
take you to a couple other places."
Mr. Halley. Get what ; what was he talking about?
Mr. FuLFORD, Money. I asked him, "Why did you go to Mr. Haw-
kins? There was no shakedown there." He said, "If you don't get
it, it is your own fault ; if it is not there, I can take you to a couple
places," and then he walked off, and I have never spoken to him since.
Mr. Halley. Did you say there was plenty for everyone?
Mr. FuLFORD. Yes.
Mr. Halley. Was anybody else present during this conversation ?
Mr. FuLFORD. Yes. It was Mr. Goldman, who was working with
me at the time, and there was another deputy also in tlie office, but
when the little skirmish started he got out about half way between the
door and the exit.
Mr.. Halley. What is that other deputy's name?
Mr. FuLFORD. Harry Cheetham.
Mr. Halley. Did Goldman hear this; was he right there?
Mr. FuLFORD. Yes. Goldman was standing there.
Mr. Halley. Goldman was the man who was with you when you
went into this Hodges' restaurant; is that right?
Mr. FuLFORD. Yes. There was no bookie joint in that restaurant.
Mr. Halley. During the year 1947 did you have occasion to go into a
dry-cleaning place out there at the shack?
Mr. FuLFORD. Out on Southwest Eighth Street?
]\Ir. Halley. Yes.
Mr. FuLFORD. That's right.
INIr. Halley. Will you tell us what happened ?
Mr. FuLFORD. We had another court order on an automobile and
we had four or five different addresses.
Mr. Halley. Who do you mean by "We?"
Mr. FuLFORD. Goldman and I. We worked together for the last
year and a half I was there. He came in tliere after I was working
there, and he worked with me I thiuk for approximately a year and a
half. I lived out there near this little shack dry-cleaning place, and
it is convenient for me to have my dry cleaning done there. I had
ORGANIZED CRIME IN ESTTERSTATE OOMMERCiE 275
lived around there for about a year and a half. Well, I searched the
tourist camp to no avail, and I went to this lady who runs the dry-
cleaning place there and I asked her if she had such a name as that on
her book. I thought possibly that if he stayed in that place he would
leave his laundry there with her. She said "No." I described the car
to her and she said the only person who could have an automobile like
that would be the peo]ile in the back. She faces Eighth Street. Mr.
Goldman asked her, "What do you mean in back," and she said, "Well,
there is a bookie joint going on back there."
She has a litle boy who I suppose is around 12 or 13 years old now
and I have known' him since before he started going to school, and he
came to me and he said, "Mr. Fulford, they have a lot of telephone
wires in there. We children were out there playing and they called
us some awful names and chased us away." I said. "What were you
doing," and he said, "We were peeping through the crack." So Mr.
Goldman told me — he says, "You set your watch with mine, and I am
going to walk across there and in 5 minutes follow me." We set our
watches together and in 5 minutes I walked over there. During the
time that he was over there, I don't know what happened. I didn't
see it. At the end of 5 minutes I walked over and when I arrived he
was talking to a man, and I walked up within about 5 feet and stopped,
and of course I heard most of the conversation from there on out.
Mr. Halley. Who was talking?
Mr. Fulford. Mr. Goldman was talking to a man who I learned
came out of this building back of the Eight Twenty Bar.
Mr. Halley. What was the conversation?
Mr. Fulford. What had gone on before I don't know. I don't
know whether Mr. Goldman identified himself as a deputy sheriff or
not, but he asked ]\Ir. Goldman in my presence — he said, "Do you
know Mr. Burke and Mr. Branning," and he says, "Yes, I do," and he
says, "They are the big shots down there, are they not." I don't know
what the reply was. I didn't hear what Mr. Goldman said. But I saw
this man Mr. Goldman was talking to write down a name and telephone
number, which I later learned was his telephone number.
Mr. Halley. Do you know the name of the man that Goldman was
talking to ?
Mr. Fulford. If my memory serves me right his name was Hoskins.
Mr. Halley. Hoskins ?
Mr. Fulford. Yes.
Mr. Halley. Do you know why he wrote this name down ; did you
hear anything about the reason for writing the name and telephone
number down ?
Mr. Fulford. Yes ; I did. I heard Mr. Goldman say, "If these fel-
lows are close to you maybe you should give me your telephone num-
ber where I can get in touch with you," and he wrote the number and
name down on a piece of paper that he took out of his pocket.
Mr. Halley. Did you and Golchnan make an arrest at that time ?
Mr. Fulford. No ; we didn't. We didn't even go into the place.
Mr. Halley. Why not?
Mr. Fulford. Well, my understanding was when I went to the civil
department that I was to do civil work except the few times I was called
out on Saturday afternoon to go with some member of the criminal
division.
276 lORG'AJSnZEP CRIIME IK INTERSTATE COMME'RCE
Mr. Halley. Mr. Goldman was a member of the criminal division ?
Mr. Fltlford. No; Mr. Goldman was in the civil department the
same as I was. At this particular place the door was locked and we
couldn't make an arrest ; we didn't see anything on which to make an
arrest.
Mr. Halley. Did you ever have a conversation with Deputy Hawk-
ins about raiding gambling places ?
Mr. FuLFORD. He told Mr. Goldman and I one afternoon that we
"v^ere to lay off of any raids.
Mr. Halley. What was the occasion for saying that ; what had
happened ?
Mr. FuLFORD. That was over on the beach ; we had made a raid over
there.
Mr. Halley. Who made the raid ?
Mr. Fui.FORD. Mr. Goldman and I.
Mr. Halley. Did you make an arrest?
Mr. FuLFORD. We did.
Mr. Halley. Right after that did you have this talk with Deputy
Harkness ?
Mr. FuLEORD. That's right.
Mr. Halley. He said you were not to raid any more gambling
places ; is that right?
Mr. FuLFORD. Yes.
Mr. Halley. Did he say where the order came from ?
Mr. FuLFORD. I don't recall. He stood there and talked a little bit.
He seemed to hesitate to hurt our feelings. He said that that was the
chief's orders and that we were not to do anything any more.
Mr. Hali^y. You are sure he didn't say that the order came from
Sheriff Sullivan ?
Mr. FuLFORD. He possibly could have said that, but I couldn't say
because there is a lot of noise in there, and of course Mr. Harkness is a
very old man and he don't talk too loud.
Mr. Halley. Did he say that the order had come from someone other
than himself ?
Mr. FuLFORD. Yes ; but he didn't say who.
Mr. Halley. He did say that they were the orders ?
Mr. FuLFORD. Yes.
Mr. Halley. Did you ever ask Hawkins of the sheriff's office to raid
a house of prostitution?
Mr. FiTLFORD. I talked to him for quite a while ; over a year.
Mr. Halley. During what period was this ?
Mr. FuLFORD. It was through 1946 and up until 1947, the day that
I resigned.
Mr. Halley. Was the place raided ?
Mr. Fulford. It was raided the day I resigned.
Mr. Halley. How long after the first complaint was that ?
Mr. Fulford. I had been complaining about it for quite a while:
approximately a year.
Mr. Halley. Why did you resign ? What was the occasion of your
resignation ?
Mr. Fulford. The day following this episode at the 820 Bar, Mr.
Goklman was fired. He came out to tell me he was fired. Then I
went in and asked Sheriff Sullivan could I talk to him a minute, be-
cause I figured if Mr. Goldman was fired for somethinjr that he did
ORGANIZED CRIME IN INTERSTATE COMMERCE 277
in line of duty, I was out there too and I wouldn't want to make the
same mistake again if I stayed on.
The sheriff refused to talk to me, so I resigned effective then and
I remained there until the 1st of November, until he got some men to
take our places,
Mr. Halley. And then did you get the job you presently hold ?
Mr. FuLFOKD. That is right.
Mr. Halley. Is there anything else you know that you woidd want
to tell this connnittee about the operations of the sheriff's office?
Mr. FuLFORD. No. When I was there, I put everything I had into
my work, and I went ahead. I had about all I could do anyway. I
had a lot of work to do and of course at night during the winter
season I worked the two dog tracks.
Mr. Halley. Do you know whether Harry Cheetham is still in the
sheriff's office ?
Mr. FuLFORD. I haven't seen Mr. Cheetham in 4 or 5 months. As
far as I know, he is.
Mr. Halley. And you said that Mr. Goldman is not; is that right?
JNIr. FuLFORD. That is right. Mr. Goldman was fired the 25tTi of
October 1947.
Mr. Halley. Do you know i f he is in Miami ?
Mr. FuLFORD. Yes ; he is in Miami.
Mr. Halley. Would you be able to give the committee his address?
Mr. FuLFORD. Mr. Goldman has moved and I don't know his address,
but I know his telephone number because he still has the same tele-
phone number. I just came back off my vacation and he moved just
before I left.
Mr. Halley. When you leave the witness stand, would you give
that number to Mr. Garrett of the committee's staff ?
Mr. FuLFORD. Yes, sir.
Mr. Halley. Have you by any chance noticed either Mr. Goldman
or Mr. Cheetham in the courtroom ?
Mr. FuLFORD. I haven't seen either one of them in here. Wlien I
was standing back and looking over the crowd, I didn't see either one
of them.
Mr. Halley. Following which incident did you resign? I think
you testified that Goldman was fired and then you quit. What was
it that happened leading to Goldman's being fired ?
Mr. FuLFORD. I don't know. That is what I went in to ask the
sheriff about, but he wouldn't tell me.
Mr. Halley. After which of the matters that you testified to did
it occur ?
Mr. FuLFORD. This was the one out on the Trail and Le Jeune Road,
at the 820 Club. The next dav after that Mr. Goldman was fired.
Mr. Halley. What happened at the 820 Club?
Mr. FuLFORD. That is where he went back to the back and 5 minutes
later I walked back there myself, and he w^as talking to a man, Hoskins
I think was his name, and he was the man who gave Mr. Goldman a
name and some numbers on a sheet of paper. I saw it at a distance.
I never did look at them.
Mr. Halley. I think you testified that Goldman got into an argu-
ment with Burke, or that you and Goldman got into an argument
with Burke?
278 ORGAJSriZED CRIIME IN INTERSTATE OOMMEKCE
Mr. FuLFORD. Mr, Burke reported to Mr. Hawkins. That was after
this affair at Hodge's place, but that was some time prior to that.
Mr. Halley. I have no further questions.
The Chairman. Senator Hunt, do you have any questions ?
Senator Hunt. I have no questions.
The Chairman. I have no questions, Mr. Fulf ord. Tliank you very
much.
Mr. FuLFORD. Thank you.
The Chairman. Mr. Goldman's name has been brought out in this
matter and I would like for the staff to see if they can find him. Let's
see if we can't present this testimony briefly. Is Mr. Hawkins here ?
Mr. Hawkins. Yes, sir.
The Chairman. All right. Come around, ]\Ir. Hawkins.
TESTIMONY OF J. L. HAWKINS, CHIEF CRIMINAL DEPUTY,
SHERIFF'S OFFICE, DADE COUNTY, FLA.
The Chairman. Do you solemnly swear that the testimony you will
give this committee will be the whole truth and nothing but the truth,
so help you God ?
Mr. Hawkins, I do.
The Chairman. All right, Mr. Halley.
Mr. Halley. Did you hear the testimony of the last witness ?
Mr. Hawkins. No, sir, I just arrived,
Mr. Halley, Did you ever have occasion to reprimand any of the
deputy sheriffs in the sheriff's office ?
Mr, Hawkins, At times,
Mr, Halley, What was your position in the sheriff's office ?
Mr, Hawkins, During what years, sir?
Mr, Halley. Will you state when you first entered the sheriff's
office?
Mr. Hawkins. January 2, 1945, as a bookkeeper until March of 1946.
Mr. Halley. And then what position did you hold?
Mr. Hawkins. Then I went to the hospital and when I came out
from the hospital I was transferred upstairs.
Mr. Halley. To what position ?
Mr. Haavkins. Chief criminal deputy.
Mr. Halley. How long did you hold that job?
Mr. Hawkins. Up until this present date,
Mr. Halley. You are still chief criminal deputy?
_^ Mr. Hawkins. Yes, sir.
Mr, Halley, Have you ever heard of a man named Thomas Hodges?
Mr. Hawkins, Yes, sir,
Mr, Halley. Will you state whether or not you know whether he is
related to Deputy Sheriff Burke?
Mr. Hawkins. I have heard some hearsay. I couldn't sa}^ under
oath that I did know it. I heard hearsay of it.
Mr, Halley, Bearing in mind that it is hearsay, would you state
to the couunittee what the hearsay is?
Mr, Hawkins. The hearsay, yes; I believe brother-in-law.
Mr. Halley. Did it ever come to your attention that Deputy Sheriff
Abe Goldman and Deputy Sheriff S. R. Fulford had been at a restau-
rant operated by Thomas Hodges and Mrs. Hodges?
ORGANIZED CRIME IN INTE'RSTAT'E COMMERCE 279
Mr. Hawkins. It w^is never called to my attention, sir. They
worked under the branch of the civil department.
Mr. Hai.ley. I will try to restate the testimony that the committee
has just heard, in which Mr. Fulford said that he and (ioldman visited
the restaurant operated l)y Mr. Hodp's and Mrs. Hodges, and that
t he next day you reprimanded them for going, I think he said, "to that
bookie joint."
Mr. Hawkixs. Xo, sir.
Mr. Halley. And he said that you told them to lay off of gambling.
Mr. Hawkins. No, sir.
Mr. Halley. That did not happen ?
Mr. Hawkins. Xo, sir. May I interrupt?
Mr. Halley. Please.
Mr. Hawkins. If there would be any such thing like that, I would
have referred it to the civil department. They didn't get their explicit
orders from me. If they were assigned to my department for any
such work as investigating gambling, then I would consider them
under my command for that particular occasion, but they specifically
worked out of the civil department, and I at no time reprimanded
any man for making an investigation of any gambling or an arrest in
any gambling. In fact. I give them a pat on the shoulder for it.
Mr. Halley. JMr. Fulford testified that he complained several times
to you about a house of prostitution in operation very close to the
place where he resided.
Mr. Hawkins. I don't know where he resided at that time.
Mr. Halley. Did he ever complain to you about a house of prostitu-
tion ?
"SLv. Hawkins. Any complaints on houses of prostitution were im-
mediately investigated and if arrests were made, which our records
will show, arrests were made.
Mr. Halley. Would you answer the question? The question was.
Did Mr. Fulford ever complain to you about a house of prostitution?
Mr. Hawkins. That I couldn't say from memory. We had several
deputies from there who made complaints. He may have, but I
wouldn't remember right now. Mr. Halley — is that your name?
Mr. Halley. Yes.
Mr. Hawkins. I wouldn't remember right now.
^Ir. Halley. You have no recollection ?
Mr. Hawkins. Not right offhand. We have had numerous com-
plaints, and they Avere immediately investigated and arrangements
made for trying to make an arrest and conviction in the court, which
we had plenty of. sir.
Mr. Halley. Mr. Fulford said he complained to you off and on
about that house and it was finally raided the day or the day after he
resigned.
Mr. Hawkins. What address; may I ask that question?
]Mr. Halley. I am sorry, but I don't have that information for you,
but I am sure Mr. Fulford does.
Is Mr. Fulford in the courtroom?
Aside from the address which I wouldn't expect you to remember,
don't you remember whether or not Mr. Fuiford over the period of a
year complained to you about a house of prostitution?
Mr. Hawkins. No, sir. Any complaint in regard to houses of
prostitution or any complaints of any violation of the law were in-
68058 — 50— pt. 1 19
280 ORGANIZEIV CMME IN INTERSTATE COMMERCE
vestigated as soon as possiblie ; at all hours of the night and the early
morning.
Mr. Halley. Mr. Fulford, Mr. Hawkins said he doesn't remember
whether or not you complained about a house of prostitution, but I
think he has indicated that he w^ould like to know the address of the
particular place that you had in mind.
Mr. Fulford. The same place I knocked off; on the corner of
Twelfth Street and Seventy-first Avenue SW.
Mr. Hawkins. They have been arrested half a dozen times.
Mr. Fulford. That is right.
Mr. Hawkins. And not from complaints only, but from the people
who lived in the neighborhood also.
Mr. Halley. Will the records of the sheriff's office show whether
it was arrested for 1 year prior to the date that Mr. Fulford resigned ?
Mr. Hawkins. That I couldn't say, Mr. Halley.
Mr. Halley. The records show that one way or the other.
Mr. Hawkins. It is there on the record what date it was. I know
I personally conducted two arrests at the place myself.
Mr. Halley. Would you check the records and bring them to the
committee at your earliest convenience ?
Mr. Hawkins. I would be happy to, sir.
Mr. Halley. Thank you.
The Chairman. That is all.
Mr. Hawkins. Thank you.
The Chairman. Is Mr. James Ivo present?
(No response.)
The Chairman. See if you can find Mr. Ivo.
Meanwhile Mr, Jack Fulenwider will come around.
TESTIMONEY OF JACK FULENWIDER, FORMER INVESTIGATOR
FOR CRIME COMMISSION OF GREATER MIAMI
The Chairman. Do you swear tlie testimony you will give this com-
mittee will be the whole truth and nothing but the truth, so help you
God?
Mr. Fulenwider. I do.
The Chairman. Mr. Fulenwider, did you work for the Greater
Miami Crime Commission doing investigations at one time?
Mr. Fulenwider. Yes, sir.
The Chairman. On what occasion did you have first-hand evidence
of some alleged violations and did you report it to somebody ; and if so,
tell what you saw and what you reported and what happened.
Mr. Fulenwider. On Monday, February 27, 1950, I was sent on an
investigation by Dan Sullivan to investigate two men who were sup-
posed to be either tapping telephone lines or installing telephones in
bookies on the beach. I liad the information that these men lived at
3799 Northwest Twelfth Terrace in Miami and that they left the house
around 9 o'clock in the morning. I went to this address and arrived
at the address at 8 : 20 a. m.
Of the two men that were described to me, one was about 30 years
old, 5 feet 11 inches, 185 pounds, with black hair, and had a pock-
marked face. The other fellow was about 5 feet 8 inches, about 185,
round face, light complexion, slightly bald, and chubby. That is all
the description we had on the men.
ORGANIZEl> CMME IN ENTKRSTATE OOMMEROE 281
When we arrived at this address we saw two men come ont of the
house that answered this description. They got into a LaSalle sedan
at 8 : 20 a. m. and they headed north on Thirty-seventh Avenue to
Seventeentli Street NW., east to Twenty-seventh Avenue and north
to Twentieth Street and proceeded toward Miami Beach.
The driver of this car was a very wild driver. He really got in and
out of traffic, and we lost him at Northeast Second Avenue and Twenti-
eth Street.
The CiiAiRMAX. Just give us such details as are necessary to get up
to the point.
Mr. FuLENWiDER. I picked up the car again in the back of an address,
600 Lincoln Road, where there was a sound company called the Twin
City Sound Co. there.
About 10 minutes after we arrived there, these two men came out
of the sound company, got in their car, and they started out the alley.
At about the same time they started out, the telephone-company truck
pulled in and the driver of the truck hollered to them to stop. So
they got out in the street and the three men — the man got off the truck
and the two men got out of the car there — talked for 3 or 4 minutes.
The truck driver backed his truck up and pulled down an alley in the
700 block on Lincoln Road and the car with the two men followed. I
stood there and watched the two men and the truck driver unload tele-
phone equipment — telephones, boxes, different things out of this truck
into the automobile for about 15 minutes.
We followed the car then north to Collins Avenue to the San Souci
Hotel. They parked in the rear of the hotel and the No. 2 man entered
the hotel and the No. 1 man sat in the car a few minutes and then he
went in the cabana section of the hotel and they were in there for
quite some time, and the one man would carry a box of tools with him.
They came out and went into the Embassy Hotel across the street
from the San Souci Hotel with the tools and the equipment. They
were only in there a few minutes and then they came out of there.
Both men went into the Sea Isle Hotel at 2 : 30 p. m. that day, and
at 2 : 40 p. m.. 10 minutes after they entered the hotel, the pock-faced
boy came back out and got a dial telephone out of his car and went
back into the hotel. The one fellow stayed there and this other guy
came out and went to an address at 1528 Drexel Avenue, which I
believe the property there is owned by Jules Levitt. He was in there
for a few minutes and then came out and went to the Bancroft Hotel,
all the time carrying his tools in the building or the hotel, whichever
he went into.
The Chairman. Did you see some wire, horse-racing or telephone
equipment somewhere, and did you report it? Let's get down to the
meat of what you have to sny.
Mr. FuLENWiDER. I had a telephone investigator with me the next
day and we went up by the Sea Isle Hotel and stood outside of Cabana
No. 22 and heard results from the races right at 2 o'clock.
We went inside the hotel and I watched this cabana No. 22, and I
saw several telephones in there — dial telephones — about three or four
dial telephones in there in the cabana and they were making book
all right. Everybod}^ had scratch sheets and pencils and when this
one fellow spotted me — I think he suspected me — he whispered some-
thing to the guy and they closed it up and they told all the patrons
to leave and everybody left and went out.
282 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chaikrian. Wliat was it you reported to the sheriff's office, or
to the prosecuting attorney's office ?
Mr. FuLENWiDER. After I completed this investigation of seeing
the actual taking of the equipment right out of the truck, Mr. Sullivan
called up Mr. Zarowny of the county solicitor's office and made an
appointment for me to come up there and explain the details of it,
who investigated that there had been a larceny of a telephone, and
the telephone company was advised of this and they were willing to
prosecute.
The Chairman. Was the telephone man with you ?
Mr, FuLENWiDER. No, sir ; not when the actual taking of the equip-
ment was done.
The Chairman, Did he advise you he was willing to prosecute ?
Mr. FtJLENwiDER. Yes, sir.
The Chairman. Wliat happened ?
Mr. FuLENwiDER. I wcut to the county solicitor's office and I talked
to Michael Zarowny, and he was trying to figure out a legal way that
could be used so this thing could be handled and to have these men
picked up.
He called down to the deputy sheriff's office and, if I am not
mistaken, it was Shields. I talked to Shields about it and told him
the circumstances, and he informed me that it was a little bit out
of his hands and it would have to go to the chief criminal investigator,
who was Claude High,
So, I went upstairs to Claude High myself and told him the story,
about all that we had seen and he flatly refused to give any aid. He
told me that we probably fouled up the investigation so bad that
nothing could be done about it and that is where the thing stands
right now.
The Chairman. Did you tell him you were willing to help or do
anything that was best?
Mr. FuLENWiDER. Yes.
The Chairman. And that you had the telephone man ready to j
prosecute?
Mr. FuLENwiDER, Yes, sir.
Senator Hunt, Have the telephone people taken any additional
interest in this?
Mr. FuLENWiDER. I dou't know whether they have or not.
Senator Hunt. You don't know whether thev are following it up or
not?
Mr. FuLENWiDER. No, sir.
The Chairman. That is all. Thank you.
Is Mr. Ivo in the courtroom?
(No response.)
FURTHER TESTIMONY OF S. M. PERKINS, ACCOUNTANT. AND
JAMES A. SULLIVAN, SHERIFF, DADE COUNTY, FLA.
Mr. Perkins, This is the set of books for the night club that started
May 2, 1949, I thought you might want to see them.
The Chairman, What night club ?
Mr, Perkins, Charlie's Inn,
The Chairman. What is the address of the night club?
Mr. Perkins. 323 Twenty-third Street, Miami Beach.
ORGANIZED CRIME IN INTERSTATE COMMERCE 283
The Chairman. When did it close operations?
Mr, Perkins. It is not closed. We used these books along with the
set of books we gave j^ou yesterday, but we got them so messed up that
we decided to keep them over the night club itself to see if we could
find out if he was making money or not.
The Chairman. We will make this journal and ledger an exhibit to
your testimony. (Exhibit No. 146. Later returned to witness after
analysis by committee.)
Mr. Perkins. Here is a copy of the income-tax reports and the work
sheets and papers from the year 1936 through 1949.
The Chairman. For whom ?
Mr. Perkins. Charlie and Sam Friedman. (Income tax reports
referred to were marked "Exhibit No. 147" and later returned to
witness.) Here are the 1950 bank statements and canceled checks
through June 1950. (Exhibit No. 148. Later returned to witness.)
You said you may want to see them.
The Chairman. We will endeavor to get these back to you tomorrow
noon.
Mr Perkins. That is all.
The Chairman. Sheriff Sullivan. I believe you have completed
your general statement. Is there anything you want to add at this
time?
Mr. Sullivan. Yes, Senator. You just had a man in here that laid
an eye of suspicion on me. That was Sam Fulford, who said he was
with Abe Goldman.
When I let Abe Goldman go from the civil department — Abe and
Sam worked in our civil department — Sam w^as going to run for con-
stable in district 2, which is this area, downtown area, of Dade County.
After I learned that I was going to have three and possibly more of
my men who were going to run for a political office while they were
working in my department, I formed a letter and I gave it to the chief
of my civil department and the chief of my criminal department and
also the chief of my road patrol and I asked them to put this letter in
a place where these men who have intentions of running for a public
office can read it and the sum and substance of that letter was that if
they run for a public office I would probably help them in any way that
I might, but that they couldn't remain in my office and go around
soliciting people to vote for them and obligate my office and serve
papers and not serve papers and killing witness subpenas, and if they
were going to run for these public offices they could go right ahead
and announce tlieir intentions to do so, and tell me when they are going
to resign from the department. These two men didn't do that. They
campaigned everywhere, so I called Abie — he was the one that w^as
doing most of the campaigning for Sam, and I told Abe, I said, "Abe,
this morning I am going to let you go." I said, "You read that letter ?
You have seen that letter?" and I said, "My men have got to respect
the office and the orders that I give."
I let Abe go and as he walked out, it wasn't 5 minutes until Sam
walked in said, "Sheriff, I'm leaving, too, since you let my partner go.
If he is guilty of something, I am."
I said, "O. K., Sam, it's all right. You can stay if you want to."
The Chairman. So you did talk to him. You didn't refuse to talk
to him?"
284 iORGANIZE'D CRilME IN LNTEiRSTATE OOMMERCE
Mr, Sullivan. No. He said, "Well, Sheriff, if you like I will work
until the 1st," and I said, "O. K., Sam." To the 1st or the 15th— I
don't remember — but it was up to the pay day. I said. "O. K„ Sam.
That is up to you." He left. That was pertaining to that particular
incident.
The Chairman. Mr, Fulford, I understand, wasn't running for
office, was he ?
Mr. Sullivan, Yes, sir.
The Chairman. Both he and Mr. Goldman, too? jj
Mr. Sullivan. They were partners; yes, sir. ;^
The Chairman. They were both running for constable ?
Mr. Sullivan. One of them was.
The Chairman. Mr. Fulford was running for constable ?
Mr. Sullivan. Mr. Fulford was running for constable.
The Chairman, And Mr. Goldman was not?
Mr. Sullivan. No.
The Chairman. Mr. Goldman got fired first, didn't he ?
Mr. Sullivan. That is right.
The Chairman. And then Fulford resigned?
Mr, Sullivan, That is right.
The Chairman, Is there anything else?
Mr, Sullivan, Now, this account of the place at Drexel Avenue
that you just had brought in here by Jack Fulenwider, I think in due
fairness to Shields, who is the deputy sheriff and one of my homicide
investigators in the office, he should be brought in here and you
should ask him what happened.
In that particular place where the boys went over there, I believe, \
if I am not mistaken, they took either six or eight telephones on Drexel
Avenue, I am not sure. However — this affair that is supposed to
have taken place at the 820 Club on Le Jeune Road, I never heard of it
before.
The Chairman. Sheriff, before you testify further, I understand
Mr, Goldman has come in and I know in fairness to you you should
follow his statement. Perhaps he has some statement that he would
like to make. So, will you stand aside just a minute ?
Mr. Sullivan. Yes, sir,
TESTIMONY OF ABE GOLDMAN, PUBLIC RELATIONS AGENT,
MIAMI, FLA.
The Chairman. Do you solemnly swear the testimony you will give
this committee will be the whole truth and nothing but the truth, so
help you God ?
Mr. Goldman. I do.
The Chairman. All right, Mr. Halley.
Mr. Halley. What is your name and occupation ?
Mr. Goldman. Abe A. Goldman, public relations agent, city of
Miami.
Mr. Halley. Did you ever work for the Dade County sheriff's
oflSce ?
Mr. Goldman. I did.
Mr. Halley. During what year?
Mr. Goldman. 1945 to 1947.
ORGANIZED CRIME IN INTERSTATE COMMERCE 285
Mr. Halley. Were you present here in the courtroom when Mr.
Fulford testified a little while ago ^
Mr. Goldman. No ; I just got here.
Mr. Halley. You are here pursuant to a subpena ; is that right?
Mr. Goldman. Yes, sir.
Mr. Halley. May 1 ask you first, Have you ever had an argument
or a fight with Sheriff Sullivan?
Mr. Goldman. No, sir.
Mr. Halley. Do you have any grievance against him?
Mr. Goldman. No, sir.
Mr. Halley. Did you ever have occasion to eat in a restaurant
owned by a Mr. Hodges ?
Mr. Goldman. Yes ; I did.
Mr. Halley. Were you with anybody at that time?
Mr. (lOLDMAN. Yes, sir, with Mr. Fulford.
Mr. Halley. Did anything happen while you were in that restaur-
ant?
Mr. Goldman. The only thing that happened was that there was
a young lady back of the counter, w^aiting on it, that weighed about
180 or 190 pounds, and she asked if we were from the police depart-
ment, if we were police officers, and I said, "Do I look like a police
officer?"' and I said, "If you would like to know, w^e are out of the
sheriff's office," and she said, "I have a brother-in-law that w^orks in
the sheriff's office,*' and I said, "You mean Mr. Burke?" because I
knew his relatives were in this place. I said, "You mean old man
Burke?" and she said he would resent that because he is very proud
of his physical prowess, and I said I was just kidding. "He's a pretty
good fellow.'"
She said, "You know, I would like to have a job like yours," and I
said, "What kind of a job?"" and she said "Being a policewoman," and
I laughed and she said, "What are you laughing at?" and I said,
"Damned if you ain't big enough."' That was the conversation that
took place.
Tlie Chaikm'n. Mr. Goldman, this is all tremendously interesting
but let"s get to the point.
Mr. (tOldman. That is the only conversation I held over there.
The Chairman. All right. Go ahead.
Mr. Halley. What happened next with reference to that Hodges
situation?
Mr. (70LDMAN. Mr. Fulford and myself arrived back at the court-
house and we were told by Mr. Harkness, our boss, that the chief
criminal deputy, Mr. Hawkins, wanted to see us on the sixth floor.
We immediately went up and he came out of the criminal courtroom
and met us in the hall. Hawkins' approach was, "Were you two fel-
lows in the neighborhood of North West North River Drive?" and
I said, "We were within the vicinity there getting something to eat.
I hope there is no objection as to where we go to get our meals."
He said, "No ; just wanted to know about it."
Fulford then spoke and he said, "I guess you know what this is the
start of. That is Tom Burke"s brother-in-law trying to put the heat
under us. I am going to run down and close them up and never let
them run as long as I am a deputy sheriff."
Mr. Fulford had some words with him and visited them every day
for the next couple of weeks and the doors were kept locked. We kept
pretty close check on it.
286 ORGANIZED CRIIME IN INtTERSTATE COMMERCE
Mr. Haij:.ey. Mr. Fulford testified about a conversation he had
with Mr. Burke in your presence in the course of the discussion about
Hodges. Do you remember anything in addition to what you have
already said?
Mr. Goldman. Mr. Fulford was pretty hot about this call from the
chief criminal deputy about having been out there and eaten in this
restaurant about 20 feet in front of the building that housed that
bookie joint. Burke was coming through the courthouse and the
sheriff was out of town at the time and he took him back in the
sheriff's private office and he told him that Mr. Fulford slapped him
down upstairs on the nineteenth floor and that he got up. and if he
slapped him down he wouldn't get up and if he didn't leave him alone
he was going to stomp him to death in the sheriff's office.
Mr. Burke turned white and said, "I meant no harm, Mate," which
was a byword of his.
He said, "I thought possibly you were getting a little something.
If you aren't you are damn fools because I am getting mine and if
you don't know where to get it, I will take you to some places and I'll
show you where to get it and how to get it."
Mr. Halusy. Get what?
Mr. Goldman. Talking about money.
Mr. Halley. Was there any further conversation at that time?
Mr. Goldman. No, sir ; not that I recall.
Mr. Halley. Do you remember ever going to a dry-cleaning place
called the Shack with Mr. Fulford looking for a Buick automobile?
Mr. Goldman. Yes, sir.
Mr. HalIxEY. When did that happen?
Mr. Goldman. It happened on the 24th of October, 1947. We had
been searching for a car on the beach and everywhere else. It was a
1946 black Buick convertible coupe. Fulford got word that there was
a car like that seen in that neighborhood and he had been taking his
dry cleaning to the woman that ran this place. I went in with him and
he asked the lady if she had seen anybody in that neighborhood that
owned a 1946 black Buick convertible coupe, and her answer was, "If
anybody in this neighborhood owns a car like that, it is the bookies
in back of me," and I said, "Don't tell me you got bookies here, too,"
and she said, "As if you gents don't know it," and I said, "I certainly
didn't know it, and to prove it, I will go back there and knock it
off."
I turned to Fulford and I said, "Check your watch against mine and
follow me over there in 5 minutes.
In the meantime there was a little boy about 7 or 8 years old, a red-
headed fellow — probably this woman's son, and he said, "I can tell
you all about it." I said, "How do you know so much about it?'' and
he said, "We ]:)lay in the yard and I was there when the telephone
com])any dug the trench and put the cables in for a lot of phones, and
I can hear the conversations quite often."
So this woman then said, "That's a fine state of affairs when child-
ren are exposed to it that way."
I went back to the place alone and there was a Yale lock on there,
oue of those flat locks, and knocked on the door and got no answer.
There is a building called the 820 Chib that is 20 feet in front of
this building both owned by the same num. The man that owned it
ORGANIZED CRIME IN INTERSTATE COMMERCE 287
used to be in the septic-tank business when — after he was with the
zoning department.
lie came out of the phice and said, "What are you doing here?" I
said, "Let me ask you the same question."
Mr. Halley. Do you know his name?
Mr. Goldman. I don't recall it, sir. He said, "I run this bar." I
said, "Do you run the book in the back?" and he said "No." I said,
"Do you know who runs it?" and he said, "Yes," and I said, 'Ask
him to come out. I want to talk to him."
We went to the bar and called him on the phone. All this time
took about 3 or 4 minutes and as this fellow came out of the bookie
joint, Mr. Fulford approached me from the other side. They both
reached me at about the same time and the man that owned the
building walked over and I said, "There are some complaints about
you ojierating a book there; is that true?"
He said, "This is my headquarters for six or eight books that operate
in this county."
I said, "I can't go through a locked door, but I'll certainly be back
with a search warrant and a fire ax and we will tear that door down."
He said, "Can I talk to you freely" — this man that owned the build-
ing said, "Can I talk freely?" and I said, "Certainly you can talk
freely." and he said, "Do you know Burke and Branning?" and I
said, "I certainly do."
Mr. Halley. Who is Burke?
Mr. Goldman. Tom Burke.
Mr. Halley. And Branning?
Mr. Goldman. The sheriff's brother-in-law, one of the deputies.
I said, "Yes, I know them. They are top men."
He said, "Yes, they are. I have made arrangements to operate
here and I pay $100 a month in the summer and $:200 in the winter."
Well, I said, "We will see if you have that kind of protection," and
I said, "AVhy don't you write your name and phone numbers down on a
piece of paper so I can turn it over to Mr. Burke and he can offer you
that protection," and he wrote his name and numbers down in his
own handwriting on a piece of paper for me.
Mr. Halley. Did you say $100 a month in the summer?
Mr. Goldman. Yes, and $jiOO a month in the winter.
Mr. Halley. Where were they taking that?
Mr. Goldman Burke and Branning; that was his statement.
Mr. Halle^'. What did you do with that piece of paper upon which
he v/rote his name and the })hone numbers?
Mr. Goldman. 1 have them wrapped in a piece of cellophane in my
23ocket.
Mr. Halley. Would you present it to the committee?
Mr. Gold:man. Yes, sir. [Handing paper.] There is the date on
the back of it.
Mr. Halley. One of the connnittee's staff asked you if you had any
evidence ?
Mr. Goldman. Yes, sir.
Mr. Halley. And you found this?
Mr. (lOLDMAN. Mr. Garrett asked me. I kept that in my possession.
Mr. Halley. I offer this in evidence, Mr. Chairman.
288 ORG'AlsriZED CRIIME ES' INTERSTATE COMMERCE
The Chairman. That will be exhibit No. 149. (On file with com-
mittee.) That is a piece of paper at the top of which it says "Hoskins
48-9612" and what is the other?
Mr. Goldman. Emniett or Eddie ; they are two brothers.
The Chairman. Emmett or Eddie. 48-9091 ; home. 9-4710.
Is that date correct? October 24?
Mr. Goldman. Yes.
The Chairman. On the back is 10-24-47. And here is something
else written on it — 4-9169 c/o — I can't read the balance of it.
Mr. Goldman. That was another book we located on the next corner
from there.
The Chairman. We will take good care of this. Mr. Goldman.
Mr. Goldman. The reason I remember that date so well is that the
following mornino; I was fired.
Mr. H ALLEY. What happened the following morning?
Mr. Goldman. The sheriff called me in his office and he said, "I am
sorry, but we are going to reduce our personnel."
Mr. Halley. Were you running for constable at that time?
Mr. Goldman. No, sir.
Mr, Halley. Was Mr. Fulford running?
Mr, Goldman. No, sir; he hadn't made up his mind whether he
would be a candidate or not.
Mr. Halley. Had he announced for his candidacy ?
Mr. Goldman. No, sir.
Mr. Halley. You didn't resign, did you ?
Mr. Goldman. No, sir.
Mr. Halley. Wliat happened ?
Mr. Goldman. The sheriff just called me and said, "We are reduc-
ing our personnel," and then I said, "It seems strange it would be me
because there have been men put on since me," and he said, ''Well, if
you will sign a resignation, I will give you 2 weeks pay in advance."
I said, "I am not resigning, so there's no need to sign one."
He said, "I will take your commission," and I tossed it over on his
desk, and then I started out the door and he said. "I will take your
badge, too," and I said, "The only way I will give that up is for some-
body to take it because I had it for 14 years. D. C. Coleman presented
that to me and I'm not giving it up." And I told him that in my
opinion I was being fired for enforcing the law.
Mr. Haixey. What happened then ?
Mr. Goldman, As I came out
The Chairman. What did he say about it?
Mr. Goldman. He didn't answer that. He said that is it.
The Chairman. What is it?
Mr. (jold:man. That was the end of the conversation. When he
came out, Mr. Fulford was there and I said I just got fired and he
said, "That finishes me, too." But I don't know what happened up
there.
A newspaperman came over to me later and said, "How aboiit a
statement ?" and I said, "You can get your statement from the sheriff.'*
That afternoon the front ])ages came out and said that Goldman
had resigned effective immediately. It said that Fulford was to run
for office and I was to be his campaign manager. I called flohn T.
Bills on the phone and told him I would like to tell the truth about
it and refute what the papers had said. He went on the air at 6: 30
iorgajStized crime in interstate oommebce 289
that night and I said that the sheriff had made a misstatement. I did
not resign. I liad been fired and in my opinion for enforcing the law.
Mr, Halley. You said that on the radio ?
Mr. Goldman. Mr. Bills did it in my behalf.
Mr. Halley. Were you present ?
Mr. Goldman. No, sir. I was listening to the radio.
Mr. Halley. What station ?
Mr. Goldman. WQAM.
Mr. Halley. Do you know Deputy Sheriff Harkness?
Mr. Goldman, Yes, sir.
Mr. Halley. Wliat is his full name ?
Mr, Goldman, A. G. "Al."
Mr. Halley. Was he the former chief of the civil division?
Mr. Goldman. Yes, sir. He was the man we worked under.
Mr, Halley. Did he ever give you any orders concerning gambling?
Mr. Goldman. He only gave us instructions one time. I think it
was the first or second raid on the beach. The time we made one we
were called to the nineteenth floor by the chief of the criminal divi-
sion and he wanted to know why we made this raid. We had a very
peculiar detail. We had to go out in the county on writs of posses-
sion and so on, not knowing where these books were and if we found
them we were to bring them back.
Mr. Harkness said, "The chief just told me to tell you fellows that
you were not to make any more raids, and not to let you know that
the orders came from him, but to be sure that it came from me. That
that was your position." He said, "I told the sheriff I thought you
men were too intelligent to swallow that, but I would give the order
but I certainly didn't think you would believe them."
I said, "Mr. Harkness, what would you do under those circum-
stances," and he said, "I would carry out my oath of office."
Mr. Halley. Is there anything else you want to tell this commit-
tee, Mr. Goldman ?
Mr. Goldman. No, sir. I didn't relish telling anything. I was sent
for and I have answered your questions.
The Chairman. Mr. Goldman, you didn't hear Mr. Fulf ord testify ?
Mr. Goldman. No, sir.
The Chairman. You came in right afterward.
Mr, Goldman. I just got here a few minutes ago.
The Chairman, How old are you ?
Mr, Goldman. 57,
The Chairman, Are you married and have you lived here a long
time ?
Mr. Goldman, Born and raised in this State,
The Chairman. Do you have your home here ?
Mr, Goldman, I have my home, two children and a grandson.
The Chairman, Have you ever been in any kind of trouble before?
Mr. Goldman. No, sir; no more than traffic violations.
The Chairman, And you are now the director of public relations
for the
Mr, Goldman, No, I am public relations agent for the city in the
engineering department.
The Chaiiuman, Of the city of Miami Beach ?
Mr, Goldman, No, the city of Miami,
290 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. That is all I have to ask.
Senator Hunt,
Senator Hunt. I haven't anything.
The Chairman. Did you follow up on this telephone installation?
Mr. Goldman. Yes, sir. I reported them to Mr. Tucker, the man-
ager of the telephone company, and they were removed several days
later.
The Chairman. They were removed from the bookie joint?
Mr. Goldman. Out of that place.
The Chairman. A day or two after you were discharged?
Mr. Goldman. Yes, sir.
The Chairman. I believe that is all, sir. We thank you.
TESTIMONY OF ALISTAIR G. HARKlTESS, DADE COUNTY, FLA.
Tlie Chairman. Mr, Harkness, do you solemnly swear that the
testimony you will give the committee will be the whole truth and
nothing Jbut the truth, so help you God?
Mr. Harkness. I do.
Mr. Halley. Is your full name Alistair Harkness ?
Mr. Harkness. That is right.
Mr. Hallet. Were you formerly in the civil department of the
sheriff's office in Dade County ?
Mr. Harkness. Yes. I have been for the past 16 years.
Mr, Halley. Are you still?
Mr. Harkness. No, not now.
Mr. Halley. Did you resign?
Mr. Harkness. No, I haven't resigned. I was very sick last year
and I couldn't get the work done any longer, so the sheriff kept me in
another capacity.
Mr. Halley. Were you in the courtroom to hear part of the testi-
mony of Mr. Goldman who just testified?
Mr. Harkness. Yes, sir. I sat right over there.
Mr. Halley. Did j^ou hear him testify with reference to youreelf ?
Mr. Harkness. Yes, I heard what he said.
Mr. Halley. Is that testimony true or untrue ?
Mr, Harkness. The testimony is true. I told both Mr. Goldman
and Mr. Fulford that the sheriff had instructed me that I was to tell
them to lay off on any raids as we had enough civil work in the office
for them to devote all their time to. That is what I told them. I
said, "Those are instructions from the sheriff."
Mr. Halley. Is there anything else you want to say in that connec-
tion?
Mr. Harkness. There is nothing else. I don't know how far they
went with it because I was assigned to the civil department and I had
no time for criminal work.
Mr, Halley, That is all.
The Chairman. That is all. Thank you, Mr, Harkness.
Has Mr, Ivo gotten in yet ?
(No response.)
The Chairman. We can't wait for Mr. Ivo.
Sheriff Sullivan, will you come around and we will not interrupt
your testimony any more.
ORG'AXIZED CRIME IN E^JTERSTATE COMMERCE 291
njRTHER TESTIMONY OF JAMES A. SULLIVAN, SHERIFF, DADE
COUNTY, FLA., ACCOMPANIED BY RICHARD M. HUNT, AT-
TORNEY
T]ie Chairman. Sheriff, you were telling us about Mr. Goldman or
some matter sucli as that and you have heard the further testimony
that has been brought out before the committee. Do you have any
comment about that ?
Mr. SuLLivAx. I do have.
The Chairman. All right, sir.
Mr. Sullivan. We just had to put oii a number of more men in our
civil department to try to take care of our civil work. We had quite
a time keeping our men who are employed for certain work to go
ahead and do that work.
All the men that are employed in the sheriff's department have
orders that regardless of what department they work in, if they see
a violation of the law, such as a felony, they are to make an arrest and
bring the case in to the court and let the court dispose of it. That is,
all my men, whether in the civil or criminal or on the road patrol. But
for my men to try to spend most of their time not taking care of the
work that they have to do, you must draw a line somewhere. So what
are you going to do ?
The job that those men had — the full job of carrying out the
processes of the court, of our civil court and the circuit court — mostly
civil courts
The Chairman. Do you know this handwriting. Sheriff [handing
Exhibit No. 149 to witness] '^
Mi". Sullivan. I don't know that I do. I don't know that I ever
saw it before. Senator.
The Chairman. "VVlio is Hoskins? And what are those other two
names ?
Mr. Sullivan. Hoskins and Emmett or Eddie. That I don't know.
I know there used to be a Hoskins out at Seventeenth Avenue and
West Flagler Street. They run a beer place on the corner which
would be the northeast corner of the intersection, but outside of that
Hoskins, I wouldn't know. I probably would know them if I did see
them, but I don't know them from that.
The Chairman. ^Y\lo was it that said this man was related to
somebody ?
Mr. Sullivan. I have a deputy sheriff' named Branning. That is
..he one you are speaking of, that is related to me.
The Chairman. Your brother-in-law ?
Mr. Sullivan. He married my sister, yes.
The Chairman. You have said earlier that Mr. Goldman said you
fired him because of reduction in force. That is what he said you
fired him for, the day following this raid or this visit with this place.
You said you fired him because he was participating in a race for
constable on behalf of Mr. Fulford ?
Mr. Sullivan. That is right. I have the letter in my department,
down in my office somewhere.
The Chairman. That is a letter that you wrote ?
Mr. SuLLiA'AN. Yes.
The Chaii MAN. These gentlemen said Mr. Goldman was not run-
ning for constable and that Mr. Fulford hadn't made up his mind.
292 ORGANIZED CRffME EST INTERSTATE COMMERCE j
Mr. Sullivan. He was campaign manager and they had made up
their minds to run before and which they did run.
The Chairman. Were you apprised of this visit out to the place
where they got this number?
Mr. Sullivan. No, sir.
The Chairman. On the day you called them in ?
Mr. Sullivan. No.
The Chairman. You don't think it is coincidental your firing of
them happened to come the day after ?
Mr. Sullivan. No, sir. I didn't know anything about it whatsoever.
The Chairman. Then you do think it is coincidental ?
Mr. Sullivan. There is no connection.
The Chairman. It is an unusual circumstance.
Mr. Sullivan. There is np connection.
The Chairman. All right, sir. Is there anything else, Sheriff?
Mr. Halley. Sheriff Sullivan, did you hear the testimony of Burke
yesterday with respect to a man named Crosby?
Mr. Sullivan. Yes; I did.
Mr. Halley. Would you tell the committee what happened with
reference to Crosby ?
First, when did Crosby first come to your office?
Mr. Sullivan. Well, I can't tell you the date. I wouldn't be fa-
miliar with the dates, but it was some time in the season of tli^ year —
in the winter season of the year.
Mr. Halley. Mr. Burke thought it was in January of 1949.
Mr. Sullivan. It could have been. Maybe it was.
Mr. Halley. That is W. O. Crosby; is that right?
Mr. Sullivan. I believe it is Bing Crosby.
Mr. Halley. His nickname is "Bing" Crosby?
Mr. Sullivan. That is right.
Mr. Halley. And he came to your office; is that right?
Mr. Sullivan. He came to my office ; yes.
Mr. Halley. What did he tell you ?
Mr. Sullivan. He came in the office and said that he would like to
talk with me, and I said "O. K." He said he would like to talk to me
in private, and I said "Fine." So we walked over in the southeast cor-
ner of the nineteenth floor in the sheriff's department and sat down and
he handed me a letter signed by our Governor, Fuller Warren, instruct-
ing me to cooperate with Crosby in any gambling that was found in
Dade County. He would appreciate the cooperation of my office.
Mr. Halley. Do you have a copy of that letter ?
Mr. Sullivan. I may have in my office.
Mr. Halley. Do you have the original of it ?
Mr. Sullivan. I j^robably do.
Mr. Halley. You brought a lot of records in here this morning.
That is one matter that was testified to yesterday. Didn't it occur
to you and your counsel that the committee might be interested in that
subject?
Mr. Sullivan. Well, I had these letters here and I was right here all
dav with you, so
Mr. Halley. In any event, the letter asked you to cooperate with
Crosby?
Mr. Sullivan. It did.
ORGANIZED CRIME IN INTERSTATE OOMMEKCSE 293
. Mr. Halley. Will you produce that letter for the committee as soon
as possible ?
Mr. Sullivan. I will. (Letter referred to entered as exhibit No.
150. Later examined and returned to witness.)
Mr. Halley. Did it specify what kind of gambling or did it just
say gambling in general?
Mr. Sullivan. Gambling in general, I believe.
Mr. Halley. Are you sure ?
Mr. Sullivan. I am not sure; I believe.
Mr. Halley. Was there any special reference to slot machines?
Mr. SuLuvAN. No; not that I can remember. The letter will state
that when I get it. but I don't think there was.
Mr. Halley. What did Crosby say ?
Mr. Sullivan. "Here is a letter from the Governor.'' He said, "I
have been here in town for some time and I do find that there is
gambling going on in quite a number of places in Dade County."
Mr. Halley. He came right after January 194:9; is that right?
Mr. Sullivan. I don't know what date he came. I certainly can't
tell you that.
Mr. Halley. What hap})ened next with reference to Mr. Crosby?
Mr. Sullivan. He asked me would 1 give him some men to go with
him to see if there was gambling at these places, and I said, "I certainly
will.'' I said, "Not only that, but I will send many more men over
there,'' and I called in a couple of men. I don't remember the first
men I sent out with Crosby, whether it was Burke the first time or
whether it was Patton — I am sorry. I can't tell you which ones, but
it was two men, I believe, the first time or the second time, maybe.
He had information of some places and they did make arrests.
Also, my men who I had sent over there, most of them made quite
a number of arrests.
Mr. Halley. Did Crosby or Burke report back to you?
Mr. Sullivan. They came back — I don't know whether it was the
next morning or three or four or five mornings later. I can't say
about the reporting back because he was to go and if they saw gam-
bling, to bring them in.
Mr. Halley. How long did Crosby stay on the job?
Mr. Sullivan. I don't know.
Mr. Halley. I mean in the Miami Beach area, looking for gam-
bling ?
Mr. Sullivan. I can't say. He was back in here and out from time
to time.
Mr. Halley. Isn't it a fact that he gave up after just a few days?
Mr. Sullivan. Oh, no.
Mr. Halu:y. Are you sure?
Mr. Sullivan. I am iwsitive; yes. I don't know how long he was
investigating the gambling.
Mr. Halley. What other men did you send out with him besides
Burke?
Mr. Sullivan. Well, definitely, Mr. Halley, I can't tell you. I don't
know.
Mr. Halley. Did vou send them out with any other men?
J Mr. Sullivan. I did.
Mr. Halley. You did ?
294 ORGANIZED CKIME IN INTERSTATE COMMERCE
Mr. Sullivan. Yes, sir. I don't know whether it was Fatten or
Shields or McElroy. I don't know who it was.
Mr. Halley. Will your records show ?
Mr. Sullivan. They would show the arrests; yes, sir.
Mr. Halley. How many arrests did Crosby make?
Mr. Sullivan. Mr. Crosby didn't make any arrests.
Mr. Halley. How many arrests did your men make on the basis of
the investigation conducted with Crosby ?
Mr. Sullivan. Well, definitely, I couldn't tell you but — I am not
up there all the time.
Mr. Halley. You have presented some very exhaustive records to
the committee. Don't you have records that would show that?
Mr. Sullivan. Oh, yes. We have some of the records, the end
sheets, in our jail.
Mr. Halley. Will you bring those records in ?
Mr. Sullivan. The end sheets?
Mr. Halley. I mean the records which will show what arrests were
made on raids where Crosby was present.
Mr. Sullivan. I can't say if there was. I can't say if there was.
I can't say how many were made while he was here, whether 5 or 10,
or what tliey were. My office is in the civil department, on the first
floor of the courthouse, and the criminal department is on the nine-
teenth floor.
Mr. Halley. Mr. Burke indicated yesterday that Mr. Crosby's
methods were very crude and that he was violating the law in making
his arrests, and that the whole investigation was very unsatisfactory
from his point of view. Did he ever complain to you about it ?
Mr. Sullivan. Well, Burke did say, "Sheriff, I can't get this infor-
mation and make these arrests without warrants."
He said, "I want to get warrants to where we won't be — where our
office will be taken care of and we won't be sued."
Mr. Halley. Did he say anything else ?
Mr. Sullivan. I said, "You can take care of the office and you don't
have to break any doors down, unless you have a warrant to break the
doors down, or unless you take the gamblers from public property."
Mr. Halley. Burke testified that he never went out on any more
raids with any warrants for arrests with Mr. Crosby; isn't that so?
Mr. Sullivan. Mr. Halley, I can't tell you definitely about that.
He may have and he may not have.
Mr. Halley. Did you hear him testify ?
Mr. Sullivan. I heard him testify.
Mr. Halley. Did you think he was telling the truth?
Mr. Sullivan. He could have been. I won't say he wasn't telling
the truth. I imagine he was.
Mr. Halley. Have you ever known him not to tell the truth?
Mr. Sui^LivAN. I can say this here : When we wanted something
really torn up, he was the man that we could depend on to tear it up.
Mr. Halley. Burke?
Mr. Sullivan. That is right.
Mr. Halley. Was his work that satisfactory ?
Mr. Sullivan. It was.
Mr. Halley. As I understand it, he was forced into a resignation
last year, in the middle of 19-19 ; is that right ?
ORGANIZED CRIME IN USTTERSTAT'E CDMMERCiE 295
Mr. Sullivan. Well, he wasn't forced into what you call a resig-
""^mThalley. Well, he was let to know that he was unwelcome,
"" M^ SuLvAN. Well, I talked with Tom a couple of times. He came
in one day and said, "Sheritf, I am goino; to take off for a while.
Mi- Haixey. What did you talk to him the time before he decided
^'^Mr.'s^LivAN. As I say, I have around 100 men working arouiid
there and my men go ahead, and they have their automobiles ihey
Imve tS F Jrds, Chevrolets; and Plymouths. Tom has a Dodge.
Mr. Halley. Didn't he have a Chrysler ? , .-f u
Mr SuLLWAN. I think it was a '46 Dodge I hea«l him testify it
was a '44, and I heard him testify it may have been a 4o
Mr hIlley. And then he testified that he had a '48 Chrysler?
Mr" Hunt. He will tell you, if you let him finish his answer.
Mr. Halley. Mr. Hunt, we are getting along fine
Mr Sullivan. I believe it was a '4(> Dodge that lom had, and he
traded that car for this Chrysler, and Tom was always on the ]ob
early in the morning. He would come down and get our crimina
records from the criminal court, and he would have everythmg all
set up when most of the other people would get down there. He was
down there early and took a pride in working the criminal court.
That is Judge Ben Willard's court. i u-
So I iust'alked to Tom, and I said, "What did you buy such a big
automobile for? The rest of my men don't feel like taking on a car
like that, and it iust kind of makes it hard on me and the other boys.
He said, "Sheriff, I bought this car, alid I traded my other car on it
as a down payment." . i • i, »
I said, "Yes, but the payments are kind of higfi.
He said, ''That is true, but I am getting $75 a month to operate this
^^We had cars in our department that we own, which our men also
used at night with radio communications, and his own individual cur
or the boys' individual cars didn't have radio^ communications. So
that was it, and Tom said, "I am going to resign." , ^ , f
Mr. Halley. And you were mad about his having spent a lot ot
money for an automobile ?
Mr. Sullivan. It didn't look right.
Mr. Halley. Why ? v i i • i ^
Mr. Sullivan. You understand why it doesn t look right.
Mr*. Halley. I would like to have you say why.
Mr. Sullivan. I believe Tom was making $350 a month.
Mr. Halley. $250 or $350. . ^^^ j. ■, •
Mr. Sullivan. His salary was, I think, $275 and $75 for his car.
Mr. Halley. For operating expenses?
Mr. Sullivan. That is right.
Mr. Halley. But that had to cover his actual expenses ot gas and
otherwise; is that right?
Mr. Sullivan. That is true. \ j ^ ^ ^i. ^
Mr. Halley. And the chances are that he spent a good deal ot that
$75 in actuallv running the car ? „ . , n . 4?
Mr SuLLiv\x. 1 am telling you that we furnished two-way cars tor
most of our boys Pi.d i)articu'larly when they owned these cars and
68957— 50— pt. 1-
296 ORGANIZED CRIIME IN INTERSTATE COMMERCE
went out on these investigations and raids, tliey would have to have
communications with the office from time to time, to look up different
parts of the investigation that are in the office.
Mr. Halley. His salary was $275 a month ; is that right ?
Mr. Sullivan. I believe it was.
Mr. Halley. And you thought it didn't look right for a man earning
$275 a month to have bought a new, expensive automobile; is that
right ?
Mr Sullivan. That is true. However, I will say this : Tom was a
very conservative man and his home and his yard looked like they had
perfect care at all times. He really had his yard beautiful, with beau-
tiful plants all over. He specialized in different kinds of plants.
Mr. Halley. That is why he quit; because you argued with him
about the automobile?
Mr. Sullivan. I suppose that is it.
Mr. Halley. We will get back to that in a moment. Do you remem-
ber hearing former Deputy Sheriff Howden testify ?
Mr. Sullivan. Yes.
Mr. Halley. Do you remember his having said as a part of his
statement that Deputy Burke was resigning because you had bawled
him out for having bought an expensive automobile? Do you re-
member hearing that ?
Mr. Sullivan. I heard something about his being mad about some-
thing.
Mr. Halley. Do you remember seeing Deputy Burke get on the
witness stand and say that he disagreed with the facts as Mr. Howden
stated them?
Mr. Sullivan. Yes ; I do. '
Mr. Halley. Would you disagree with Mr. Howden's statement
that you had reprimanded Burke severely for having bought an ex-
pensive automobile ?
Mr, Sullivan. No ; I didn't reprimand him severely.
Mr. Halley. Do you mean you chided him gently ?
Mr. Sullivan. I just told him that it isn't right. I told him I didn't
think he should buy this big car, and I frankly thought he ought to get
rid of it.
Mr. Halley. Bnt you didn't reprimand liim severely?
Mr. Sullivan. No.
Mr. Halley. Burke is a man who had lived an outdoor life, and he
is not a sensitive soul, is he, Sheriff?
Mr. Sullivan. Mr. Halley
Mr. Halley. What I am getting at is why did he resign ?
Mr. Hunt. Please let him finish his answer.
Mr. Halley. I am trying to help him.
Mr. Hunt, You don't have to hel]) him.
The Chairman. Just a minute, Mr. Hunt. Sheriff Sullivan is testi-
fying and I think we are getting along pretty well except that Ave are
going awfully slow, so let's try to get along with the testimony.
Mr. Sullivan. Yes, Mr. Halley?
Mr. Halley. All I am trying to ^^vt at is if it was a \ erv gentle repri-
mand, why did Burke quit?
Mr. Si'LLivAX. Well, T didn't curse at him or 1 didn't shout at him.
It is not my policy to do that.
ORGANIZED CRIME EN" INTE'RSTATE COMMERCE 297
Mr. Halley. When did Burke quit ? It was in the middle of 1949,
wasn't it?
Mr, Sullivan. I believe you have the date there.
Mr. Halley. Around June, 1949; is that right?
Mr. Sullivan. It was some time around that date.
Mr. Halley. Why did you wait a year to rej^rimand him for some-
thing— for having bought an automobile in 1948?
Mr. Sullivan. That is what I am telling you about this. I repri-
manded Burke right after he bought the car.
Mr. Halley. You said he quit right after you reprimanded him
and he testified he bought the car in 1948.
Mr. Sullivan. He didn't quit after I reprimanded him. He did
work and said, "Sheriff, I am going to take off. I've got some work
I have to do in my home down here and I am going to go and take care
of my grove."
Mr. Halli:y. He waited a year to quit?
Mr. Sullivan. I don't know how long it was.
Mr. Halley. You say Tom said he was going to take care of his
grove ?
Mr. Sullivan. That is right. He said he had some work he had
to do.
Mr. Halley. He said that he didn't buy the grove until June of 1949,
I believe.
Mr. Sullivan. I can't be specific or definite about those dates because
it was just purely a reprimand about buying the car and having all
my other men out there saying, "I can't buy that kind of a car."
Mr. Halley. You reprimanded him after he bought the car, didn't
you?
Mr. Sullivan. I did.
Mr. Halley. That that was about a year and a half later?
Mr. Sullivan. I don't know when he quit, but that is when it was.
Mr. Halley. Something else happened, though, to cause him to
quit. You asked for his resignation, and there was a reason for it,
wasn't there?
Mr. Sullivan. No. it was all about the car.
Mr. Halley. Was there more than we already have ?
Mr. Sullivan. Not that I know of, no.
Mr. Halley. Deputy Hawkins was in charge of the criminal side of
your office?
Mr. Sullivan. Howden was my chief criminal deputy until he got
sick and went to the hospital. He was sent to the hospital by Dr.
Chambers and Dr. Thomas.
Mr. Halley. When was that?
Mr. Sullivan. I am sorry, but I can't give you the definite date.
Mr. Halley. Wasn't it about the same time that Burke" quit?
Mr. SuLLFv^vN. No, I don't believe so. However, he was in the hos-
pital and we didn't think he would ever recover. It was something
he got in the First World War.
Mr. Halley. Wasn't there really some trouble growing out of the
Crosby visit? Didn't some friction arise between Crosby and the
people who had sent him and Burke as a result of which Burke was
asked to resign and Hawkins relieved of his job?
Mr. Sullivan. In no way.
298 (ORGAJ^IZE'D CEIME EST LNTERSTAT'E COMMERCE
Mr. Halley. Didn't Crosby leave the Miami area within a very
short time after he arrived in January of 1949 ?
Mr. Sullivan. Well, I guess he left, but he was back several times.
Mr. Halley. Didn't you send word to the Governor of Florida that
you were responsible for law enforcement in Dade County and that
you didn't want Crosby making gambling pinches in Dade County?
Mr. Sullivan. No, sir ; because if I remember, he didn't make any
gambling pinches in Dade County.
Mr. Halley. He tried awfully hard though, didn't he?
Mr. Sullivan. Whether or not he tried he had no authority to make
gambling pinches in Dade County. He told the officers to do it.
Mr. Halley. He had Burke with him, didn't he?
Mr. Sullivan. I think Burke was with him on three, four, or five
occasions and if Burke wasn't there he took another man from the
office. Whoever was there he got.
Mr. Halley. How many times did he ask the office for help after
I think the three occasions that Mr, Burke mentioned ?
Mr. Sullivan. Well, I don't know that — that is kind of hard to say.
I don't know how I will be able to tell you.
Mr. Halley. Isn't it a fact that Mr. Crosby just stopped trying to
get any furtlier help from the sheriff's office of Dade County in
finding gamblers and arresting them ?
Mr. Sullivan. No. If I remember right — I don't remember if he
was down here in March — he was here in February and March several
times.
Mr. Halley. Was there a man named Bowers ?
Mr. Sullivan. I don't know any name, any man named Bowers,
Mr. Halley. Did you ever hear of a man named Bowers i
Mr. Sullivan. I heard of him, George Bowers.
Mr. Halley. You heard of him ?
Mr. Sullivan. Yes, sir.
Mr. Halley. Wasn't he down liere with Crosby ?
Mr. Sullivan. Well, he could have been. I didn't know.
Mr. Halley. Do you know a man named John Eush ?
Mr. Sullivan. I know John Rush.
Mr. Halley. Did you ever talk to John Rush about Crosby ?
Mr. Sullivan. I could have. I don't remember it definitely.
Mr. Halley. Will you search your memory and state to the best
of your recollection whether you talked to John Rush about Crosby ?
Mr. Sullivan. It possibly could have been. As I say I don't re-
member any details. If you would read the details you have there
maybe I could tell you.
Mr. Halley. You know you did, don't you?
Mr. Sullivan. I talked to John Rush.
Mr. Halley. About Crosby.
Mr. Sullivan. I don't know as I said.
Mr. Halley. You don't know you didn't ?
Mr. Sullivan. I don't know whether I did or not. I don't
remember.
Mr. Halley. Is that the best answer you can give ?
Mr. Hunt. Pie has given his answer.
Mr. Halley. Please let the witness answer.
Mr, Hunt. I don't think he has a right to grill the witness time
after time on the same proposition.
ORGANIZED CraME IN INTERSTAT'E COMMERCE 299
The Chairman. Well, Mr. Hunt, I think Sheriff Sullivan is quite
able to take care of himself in this colloquy between Mr. Ilalley and
himself.
Mr. Hallet. Isn't it a fact that you told Mr. Eush to get Crosby
off your county and not to let him interfere with gambline; establish-
ments in your county; that if they were to be raided and arrested
you would make those raids and arrests from your own office^
Mr. Sullivan. I don't remember telling Mr. Rush that.
Mr. Halley. Are you sure you didn't tell him that ?
Mr. SuLLR^AN. I don't like anybody coming into my county and
picking out ]>eople to be arrested or anything like that, but I don't
remember telling Mr. Rush, or, in fact, I don't remember talking to
Mr. Rush about Crosby.
Mr. Halley. Are you able to say definitely that you never talked
to Mr. Rush about Crosby ?
INIr. Sullivan. It is possible that I could have. I don't remember
the details of it, Mr. Halley. You*niight ask Mr. Rush. He might
tell you.
Mr. Halley. How about Bowers ; do you know Bowers ?
Mr. SuLLRAN. I don't know Mr, Bowers.
Mr. Halley. You have heard of him?
Mr. Sullivan. Oh, yes.
]Mr. Halley. Isn't it a fact that when Mr. Crosby returned to the
Miami area after January he was with Mr. Bowers and they were
working together ^
Mr. Sullivan. It could have been, but that is something I never
knew of.
Mr. Halley. When you say ''It could have been," you mean some-
body told you about it ?
Mr. Sullivan. I say it could have been. Nobody told me about it
anyway. I say it could have been because I don't know one way or
another. The only time I saw Mr. Crosby when he was here in our
town is when he came to my office and maybe we would go and eat occa-
sionally; that is all.
Mr. Halley. Did you ever mention to anybody whatsoever that you
didn't want Crosby interfering with law enforcement in Dade County?
Mr. Sullivan. Well, I don't know that I did. However, there is a
possibility, because I like to run my own office. I was elected by the
people of Dade County to run my own office ; and, regardless who it is,
if they come in there to help me I am going to help them, but I don't
remember ever making the remark of that kind.
Mr. Halley. Wlien Crosby first came to your office he had a map
with him ; did he not ?
Mr. Sullivan. I never saw it.
Mr. Halley. Didn't he show you a map ?
Mr. Sullivan. He showed a letter from the Governor.
Mr. Halley. Did he show you a map, too ?
Mr. Sltllivan. I never saw the map.
Mr. Halley. The locations he went to were S. & G. Syndicate loca-
tions ; were they not ?
Mr. Sullivan. That I can't tell you, because I don't know.
Mr. Halley. Did he ever complain to you about the fact that on
two occasions when he and Burk arrived at the scene of the place they
were going to raid, either immediately or shortly afterward, the
300 ORGANIZED CRIME IN INTERSTATE COMMERCE
attorney for the S. & G. Syndicate, Ben Colien arrived on the scene ?
Mr. Sullivan. I heard testimony to that effect here yesterday.
Mr. Halley. You never heard tliat before ?
Mr. Sullivan. I heard it at the time the arrests were made; yes.
Mr. Halley. Did you ever make any attempt to find out how Mr.
Ben Cohen was able to get information so soon ?
Mr. Sullivan. Well, I don't know. I believe Burk said that they
were called?
Mr. Halley. That who was called ?
Mr. Sullivan. That Mr. Cohen was called.
Mr. Halley. By whom?
Mr. Sullivan. I suppose one of the people there in the apartments.
Mr. Halley. Did you ever investigate how this happened?
Mr. Sullivan. The arrests on these things are made and the men
are brought into our office. As I said, I am upstairs part of the time
and part of the time downstairs. This county is about 65 miles long
and about 40 miles wide, and I have many things to do, outside of
gambling only, in our county. We have other laws that are violated
and that we have to work on, which we try to do. I have a criminal-
investigating department upstairs. I know that I use my full in-
vestigating department.
Mr. Halley. Getting back to the question, did you ever investigate
how the attorney for the S. & G. Syndicate was able to get to the
scene of the arrests so soon so that he was there almost as fast as
your people on the scene?
Mr. Sullivan. Well, I wouldn't know that unless whoever w^as ar-
rested, which is customary, wiioever is arrested, call their attorney
right immediately and they also call whoever is their bondsman to
meet them, and their bondsman meets them upstairs on the nineteenth
floor when they are brought up.
Mr. Halley. There was no testimony that the attorney was called
by the person arrested. The testimony was that Mr. Cohen in one
case walked in almost immediately, and in the other case was there to
greet them.
Mr. Sullivan. That could be.
Mr. Halley. Would that be investigated if it came to your
attention?
Mr. Sullivan. It could be, but
Mr. Halley. Was it ?
Mr. Sullivan. At the present time I don't believe that it was, or,
rather, I don't see anything there was pertaining to my department
to investigate the thing. The arrest was made or an attempt to arrest
was made.
Mr. Halley. For 1 minute, to get back to Mr. Fulford; do you
r?'member whether he resigned or was fired?
Mr. Sullivan. Well, I—
Mr. Halley. Do you recall the testimony now ? Mr. Fulford said
that as Goldman walked in he was fired, and then Mr, Fulford
testified he resigned.
Mr. Sullivan. That is what happened. He said. "Sheriff, what he
had done I done, and I will resign, too."
Mr. Halley. Goldman, you told the chairman, was not the man who
was running for office.
Mr. Sullivan. That is true.
ORGANIZED CRIME IN INTERSTATE COMMERCE 301
Mr. Hali.ey. Isn't it a fact that at least three men in your office
•who were also running for constable were never fired?
Mr. Sullivan. That is true.
Mr. Halley. Now, Sheriff Sullivan, when did you become sheriff?
Mr. Sullivan. On January 2. 1945.
Mr. Halley. What was your job before 1945?
IVIr. Sullivan. I was a police officer.
Mr. Halley. When did vou become a police officer?
Mr. Sullivan. Well, in'l9;J3; the latter part, I believe, of 1933.
Mr. Haixey. On what police force were you?
Mr. Sullivan. Miami, Fla.
Mr. Halley. The Miami police force?
Mr. Sullivan. Yes.
Mr. Halley. And you were there continuously from 1933 to 1945?
Mr. Sullivan. I was there through January the 1st of 1944.
Mr. Halley. AVhat did you do from January 1, 1944, to January
1,1952?
Mr. Sullivan. Well, I run for office until I was elected on May
23, in 1944, and then after I was elected to office I visited some of
the different sheriff's departments in the State of Florida. They was
going to have a school here in the State of Florida for all the newly
elected sheriffs, to which I was going to go. I was going to attend,
I mean. I wanted to attend the Federal Bureau School in Washing-
ton if I could, but I couldn't make the arrangements because they
were already filled.
I didn't go to the school in Florida because they told me I was
the only man who was interested in going to the Florida school for
the newly elected sheriffs; so I came back to Miami and went to the
University of Miami.
Mr. Halley. For how long ?
Mr. Sullivan. About 4 months, I believe.
Mr. Halley. What did you study there ?
Mr. Sullivan. I studied criminal procedure. State government,
personel management, and the law of torts.
Mr. Halley. What was vour position on the police force until
January 1, 1944?
Mr. Sullivan. I was a traffic officer.
Mr. Halley. A traffic officer?
Mr. Sullivan. Well, I was a traffic officer for a good many years;
for 7 years, I believe.
Mr. Halley. What 7 years was that ?
Mr. Sullivan. That was the last 7 years I was on the force.
Mr. Halley. What did you do
Mr. Sullivan. Previous to that, I w^as on the radio-car detail,
working in the colored section of Miami and in the downtown area of
Miami.
Mr. Halley. While you were on the police force did you have any
other business ?
Mr. Sullivan. Well, I didn't have any other business. I would
like to show you some things that I did while I was on the police force
in the city of Miami.
Do you have those things, Mr. Hunt ?
Mr. Halley. Just a moment, please. You will have a full oppor-
tunity, but now I am referring to other means of earning income other
than your salary on the police force.
302 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Hunt. That is what he is trying to tell you.
Mr. Halley. Is that what you are trying to get at '?
Mr. Sullivan. Yes.
Mr. Halley. If so, it is relevant and you can give it to us now.
Mr. Sullivan. I worked at the bus station every other month at the
Miami Transit Co.
Mr. Halley. Yes ?
Mr. Sullivan. And I believe that we made, I think, around $55 a
month extra at that, and I think I made about $8 or $10 every month
turning lights off. Then I was buying and selling automobiles or
radios or whatever happened to come along that I could buy and make
a few dollars on.
Mr. Halley. Did you
Mr. Sullivan. I bought quite a few automobiles.
Mr. Halley. I am sorry.
Mr. Sullivan. I bought quite a few automobiles while I was on the
police force.
Mr. Halley. You mean during the war ?
Mr. Sullivan. While I was on the police force.
Mr. Halley. Was that after 1942 and before 1944 that you are re-
ferring to that you were buying automobiles ?
Mr. Sullivan. No. Most of the time I was on the police force.
Mr. Halley. As a traffic officer, those were things you would get to
know about?
Mr. Sullivan. Well, people on the corner I would get to know and
get to know about it. I would help people in many ways, and people
would stop by and help me.
Mr. Halley. Go ahead. You have some pictures you want to show
us?
Mr. Sullivan. Yes, sir. Here is one in 1937 while I was on the
police force that I built [handling photograph to Mr. Halley] . I built
it out at 1803 Northwest Sixth Street.
Mr. Halley. Did you build it for yourself ?
Mr. Sullivan. Yes, indeed. It was a two-story duplex.
Mr. Halley. And you sold it in 1939 ?
Mr. Sullivan. Yes ; I did.
Mr. Halley. And did you make a profit on that transaction?
Mr. Sullivan. Yes ; I did.
Mr. Halley. How much ?
Mr. Sullivan. Well. I think that I made around — I am not sure — ■
possibly $1,700, maybe $1,900. I am not sure. However, I went in
there owing quite a bit of money on my property, and when I came out
I didn't owe anything outside of my payments that I was making
monthly and I had my property looking very beautiful.
Mr. Halley. It looks very nice. Now, after 1939 did you have any
other opportunities to earn money other than your salary?
The Chairman. We will mark this exhibit No. 151 for the record.
(See appendix, p. 782.)
Mr. Sullivan. In 1939 I bought a lot at 2321 Southwest Fourth
Street and I built a house there — a three-bedroom and two-bath house.
Mr. Halley. How much did the lot cost ?
Mr. Sullivan. The lot I believe cost either $450 or $500, something
like that. I built a very pretty three-bedroom two-batli house. Here
is the house [handing picture to Mr. Halley].
ORGANIZED CRIME IN INTERSTATE COMMERCE 303
The Chairman. AVe will mark that photograph exhibit No. 152 for
the record and file it. ( See aj^pendix, p. 782. )
Mr. Sullivan. I sold that house after about a year or so, maybe a
little longer, but in the meantime I had bought the lot next door to it
iiud all that time I woi-ked on the corner. I built those houses while
I was — while I had m^' vacation.
Mr. Halley. Did vou build them all by yourself or did you have
help?
Mr. Sullivan. I had help. I had fellows helping me. I built the
houses, but I had people to help me.
Mr. Halley. You hired people to help you ?
Mr. Sullivan. Yes, sir.
Mr. Halley. How many houses did you build altogether?
Mr. Sullivan. Seven, I believe.
Mr. Haliey. Between what years?
Mr. Sullivan. Well, now, wait a minute. Five while I was on the
police force and I bought two and remodeled them.
Mr. Halley. While you were on the police force?
Mr. Sullivan. Here is the one at 2327 Southwest Fourth Street
[handing photograph to Mr. Halley].
The Chairman. We w'ill mark that photogi-aph exhibit No. 153 for
the record and file it. See appendix, p. 783.)
Mr. Halley. I would like to know in what years you had these real-
estate transactions.
Mr. Sullivan. I built that house, I believe, in 1940, I think.
Mr. Haixey. On the back it says, "Built in 1940 and sold in 1941."
Mr. Sullivan. Yes.
Mr. Halley. Was the first one in 1939?
Mr. Sullivan. 1937.
Mr. Halley\ 1937?
Mr. Sullivan. Yes, sir.
Mr. Halley. And there were altogether seven — five of wdiich you
built and two of which you remodeled?
]Mr. Sullivan. That is right.
Mr. Halley. Now, how many did vou build before 1939 and sell
before 1939?
Mr. Sullivan. One.
Mr. Halley. One?
Mr. Sullivan. Yes.
Mr. Halley. And six after 1939?
Mr. SuLi.iVAN. Well, six or seven.
Mr. Halley. Can we just have the dates when you built and sold
each one?
Mr. Sullivan. Well, the dates are on the backs of these pictures.
If the dates are on the back, I will be happy to give them to you.
Mr. Halley'. Would you, please?
Mr. Sullivan. Well, I built in 1937 and sold in 1939 the house at
1803 Northwest Sixth Street. Then in 1939 I built and sold in 1940
the house at 2321 Southwest Fourth Street. Then I bought the lot in
1939. built the house in 1940, and sold it in 1941, the house at 2327
Southwest Fourth Street. Then in 1941 I built the house at 2370
Southwest Fourth Street and sold it in 1942 Thanding photograph to
Mr. Halley].
304 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. We will mark it "Exhibit No. 154" for the record
and file it. (See appendix, p. 783.)
Mr. Sullivan. However, in between time between the sale of the
second house there at 2321 Southwest Fourth Street and the buildin<r
of the one at 2327 Southwest Fourth Street I leased the apartment
down in the corner 2398 Southwest Fourth Street, the duplex there
and I sublet half of it.
Mr. Halley. Did you derive an income out of it ?
Mr. Sullivan. While I was building my home at 2327 I lived there
and then when I finished the 2327 house I sublet for the winter the
place, the duplex.
Mr. Halley. You told us about three houses.
Mr. Sullivan. Yes, sir.
Mr. Halley. Will you go on ?
Mr. Sullivan. The next one that I built after that was this two-
story house at 2370 Southwest Fourth Street [handing photograph to
the chairman]. It was built in 1941 and it was sold in the latter part
of 1942.
The Chairman. That will be exhibit No. 154 [repeating].
Mr. Sullivan. This one here was bought in 1942 and was sold in
1943 [handing photograph to the chairman].
Mr. Hunt. What number is that?
Mr. Sullivan. That is 2338 Southwest Fifth Street.
The Chairman. It will be marked "Exhibit No. 155." (See appen-
dix, p. 784.)
Mr. Sullivan. Here is a place that was built in 1941 at 2620 South-
west Ninth Street and sold in 1942 [handing photograph to the chair-
man].
The Chairman. That will be exhibit No. 156.
Mr. Sullivan. Here is a place at 2332 Southwest Fifth Street that
I built in 1943 and sold in 1943 [handing pliotograph to the chairman].
The Chairman. That will be exhibit No. 157.
Mr. Sullivan. Here is one that I bought in 1943 and sold in 1946 at
2236 and 2238 Southwest First Street. A room was added in 1943. It
is a duplex.
The Chairman. That will be exhibit No. 158.
Mr. Sullivan. Here is a lot that was brought in 1946, built on in
1947 and sold in 1948. That is 2240 and 2242 Southwest First Street
[handing photograph to the chairman].
The Chairman. That will be exhibit No. 159 for the record.
Mr. Sullivan. Here is a place at 261 Southwest Thirtieth Koad that
I bought in 1947 [handling photograph to the chairman].
The Chairman. That will be exhibit No. 160.
Mr. Sullivan. Here is a house at 2485 Southwest Fourth Street that
was built in 1949 and 1950, finished along February, something like
that [handing photograph to the chairman].
The Chairman. That will be exhibit No. 161. (The above exhibits,
Nos. 156-161, appear in the appendix, pp. 784-787.)
Mr. Halley. You still own two?
Mr. Sullivan. I still own 2485 Southwest Fourth Street.
Mr. Halley. Now, in 1942 did you borrow some money from the
First Federal Savings Bank ?
ORGANIZED CRIME EST INTERSTATE COMMERCE 305
Mr. Sullivan, In 1942 I imagine that I did. I built a liouse at
2321 and 2327 Southwest Fourth Street and I got a loan on those
houses.
Mr. Halley. Do you remember stating your total assets when you
applied for that loan ?
Mr. Sullivan. Well, I didn't ever
Mr. HALI.EY. This was in 1942.
Mr. Sullivan (continuing). State my total assets because
Mr, Hallet. When you apply for a loan you try to prepare a
substantial statement, don't you?
Mr. Sullivan. When you apply for a loan you have to have enough
as they say at the First Federal to "span the gap" because I never did
like to put down what money I had, so I didn't do it.
Mr. Hallev. You mean, when you told them how much money you
were worth you were really being very modest about it?
Mr. Sullivan. Well, I just put down enough to get my loan.
Mr. Halley What did you tell them your assets were to get this loan
in 1942?
Mr. Sullivan. I don't remember which loan it happened to be.
However
Mr. Halijiy. Was it $2,500?
]Nfr. Sullivan. It could have been. Maybe I was borrowing that
much.
Mr. Halj,ey. In any event it could be that you said in 1942 that
vour total assets were $2,500?
"' Mr. Sullivan. No. In 1942?
Mr. Halley. Yes.
Mr. SuLiiivAN. No, it couldn't have been.
Mr. Halley. It couldn't have been?
Mr. Sullivan. No, sir.
Mr. Halley. Well, what did you say they were ?
Mr. Sui.ltvan. That I don't definitely remember, but it couldn't
have been that.
Mr. Halijiy. If the loan application states that, would the applica-
tion be wrong ?
Mr. SLTLiiivAN. It wouldn't necessarily be so.
Mr. Halley. But it could be on the application?
Mr. Sullivan. It possibly could; yes. It could be on the applica-
tion; yes.
Mr. Halley. In 1943 you sold two of those houses, did you not?
You stated a few moments ago that you did.
Mr. Sullivan. I may have.
Mr. Halley. You so stated about 5 minutes ago.
Mr. Sullivan. If that is what it says on the back there that is what
happened. I don't know,
Mr. Halley, It says on the back of the picture that you sold them
in 1943. Do you have any records pertaining to these houses, financial
records ?
Mr. SuLUVAN. I guess my tax man has them.
Mr. Halley. Is he here ?
Mr. Sullivan. Yes, he is here.
Mr. Halij5Y. Maybe he can produce them ?
306 ORGANIZED CRIME IN INTERSTATE COMMERCE
TESTIMONY OF DAVID W. HALL, ACCOUNTANT
The Chairman. Mr. Hall, you may be called on to testify, do you
solemnly swear that the testimony you will give this committee will be
the whole truth and nothing but'the truth, so help you God?
Mr. Hall. I do.
The CriATRMAN. Just pull up a chair alongside Sheriff Sullivan.
Mr. H ALLEY. What is your full name?
Mr. Hall. David W. Hall, certified public accountant.
Mr. Halley. And you have here certain records of Sheriff James
Sullivan ?
Mr. Hall. I have copies of his income-tax returns.
Mr. Halley. Do you have any other documents ?
Mr. Hall. Yes, I have a few closing statements on sales, not all of
them.
Mr. Halley. Do you have any statement showing profit and loss on
sales ?
Mr. Hall. Yes, in the income-tax returns.
Mr. Halley. Do they show on the tax returns — income-tax returns?
Mr. Hall. Yes.
Mr. Halley. Would you make available to the committee the in-
come-tax returns which you have here ?
Mr. Hall. I have here copies of income-tax returns from 1940
through 1949.
Mr. Halley. Would you hand them over here ?
The Chairman. Let them be made exhibit No. 162. (Later returned
to witness.)
Mr. Hunt. Will they be returned ?
The Chairman. They will be.
Mr. Halley. Now, do you have any records showing the profit and
loss on two buildings which were sold in 1943 ?
Mr. Hall. If I could see the returns I could tell.
Mr. Halley. For 1943?
Mr. Hall. Yes.
Mr. Halley. Here you are [hands documents to the witness]. Do
you want the amended returns?
Mr. Hall. Yes, sir. There were two sales in the year 1943. Lot 5,
block 6, Fairmont, purchased December 6, 1942, at a cost of $2,750.
Subsequent to acquisition, there were improvements made to the
property totaling $1,959.
On March 11, 1943, the property was sold for $6,500, showing a gain
of $1,791.
Mr. Halley. What was the date of sale ?
Mr. Hall. March 11, 1943.
Mr. Halley. What was the name of the lot?
Mr. Hall. Lot 4, block 6, Fairmont Park was bought in May of
1943, and it cost $4,500 and the selling price was $6,950, after sub-
tracting the cost of sales and so forth. The gain on that sale was
$2,075.50.
Mr. Halley. May I see the retuin for 1943? Now you have just
handed me an amended return for 1943. Do you liave the original
return for 1943 ?
Mr. Hall. I have it here.
Mr. HalIvEY. When was the amended return filed?
ORGANIZED ORIME IN INTERSTATE COMMERCE 307
Mr. Hall. May I see it a^ain? [File handed to Mr. Hall.] I
don't have the date of that, but it was recently.
Mr. Halley. In 1950 ?
Mr. Hall. Yes.
Mr. Halley. Now the original return was filed in 1944 for the
calendar year of 1943 ; is that right?
Mr. Hall. Yes, sir.
Mr. Halley. On the original return, can you state what the net
income was for Sheriff Sullivan, for the year 1943, was at this
time?
Mr. Hall. By net income, do you mean
Mr. Halley. Net taxable income.
Mr. Hall. After tax is off ?
Mr. Halley. No, before taking off the taxes, state your deductions.
Mr. Hall. $2,573.
Mr. Halley. Well, that doesn't reflect profit on the two sales of
real estate?
Mr. Hall. No; that is the reason an amended return was filed this
year.
Mr. Halley. What are the circumstances under which an amended
return was filed this year?
The Chairman. Maybe Sheriff Sullivan can tell that, gentlemen.
Mr. HuxT. Mr. Hall can tell you.
The Chairman. Well, let's have the sheriff tell. The question is.
Sheriff, you filed a return in 1943 and you filed one in 1950 and you
have something else?
Mr. Sullivan. Well, I don't know. They stated one year that I
didn't file a return.
Mr. Halley. You did file one in 1943, didn't you ?
Mr. Sullivan. If you have it I did. I file one every year.
Mr. Halley. And you filed a return showing an income of $2,387.75 ;
isn't that right ?
Mr. Sullivan. What do you mean?
Mr. Halley. Now, in 1950 you corrected this to show $7,300.53.
Mr. Sullivan. Whatever is there is the amount, the amended
income.
Mr. Halley. Would you answer that question as to the circum-
stances under which the income was amended ?
The Chairman. Sheriff, you tell us about it here. Here is the 1943
one, and here is the amended one.
(Chairman hands Mr. Sullivan documents.)
Mr. Halley. Don't any of you know the facts? This has been very
recent.
Mr. Hunt. His auditor can tell you, if you want him to tell you.
Mr. Sullivan. I don't know anything about these taxes — paying
these taxes. I guess it is about 99 percent of us who don't know. I
paid taxes for several years, and apparently my taxes were not being
paid at all, or sent to the right places; and I have had a tremendous
amount of checking on my income taxes for the past year or maybe
longer. They have been calling me from all over Dade County about
my income tax. Thev say, ''What is the matter, there has been a man
here checking on you ?"
308 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. Here I have been looking at your 1943 income-tax
report. It looks like it is very skillfully made out by an auditor. Did
somebody make it out for you ?
Mr, Sullivan. Mr. Hardin McQueen.
The Chairman. Does that represent the information vou gave him,
I take it, Sheriff?
Mr. Sullivan. Well, in each one of these cases that were filed, there
was a total of yellow sheets that were filed with each one of these forms
that are here, with my total income on it.
The Chairman. These yellow sheets are not here. Sheriff, the point
is
Mr. Sullivan. It is a worksheet of our taxes and how they are
made up.
The Chairman. The point is, you had this 1943 income-tax report
made out by an auditor. The tax here was apparently $72.66. Now
all of these forms back here, did you or did you not make this profit on
the sale of these houses in 1943 ?
Mr. Sullivan. Yes. I made those sales on those houses at that time.
The Chairman. Why didn't you report it? You have taxes here
deducted.
Mr. Sullivan. It was put on my income taxes. Whatever I made in
1 943 there, was put on my income taxes.
The Chairman. Do you mean on your original one ?
Mr. Sullivan. Yes, sir.
The Chairman. Then you say that this is not correct, your original
1943 return ?
Mr. Sullivan. Whatever the return was when I built my houses. At
the end of the year I went to the auditor, McQueen, and I had my taxes
straightened out with him.
The Chairman. Well, the place here for income is, Miami Transit
Co., Miami, Fla., $337.50 ; city of Miami, $2,335.50. Is that all. That
is all the income you have listed in your original for 1943. Where are
these houses. Where is the profit from these houses ?
Mr. Sullivan. The one in 1939 and 1940 and 1941 ?
The Chairman. No, the ones you sold in 1943 ?
Mr. Sullivan. Senator, let me say this: On this income tax here,
there was a yellow sheet exactly like this one here [indicating] which
was a work sheet. That work sheet was attached to each one of my
income leports, because my income reports were put on there — on the
yellow sheet — ^and I left my money that was supposed to be sent, the
money that was supposed to be the amount of profit I had made off my
own home — on those yellow papers. And when I learned of this in-
vestigation of my income tax, well I go and ask for the yellow sheets
of these files that stay here. I didn't keep them myself, they are kept
in the office, and the yellow work sheets were not there.
The Chairman. So they were not available, they didn't show up,
tliey were nowhere around ?
Mr. Sullivan. No.
The Chairman. But you know for sure. Sheriff, that you made some
])roHt on those houses?
]Mr. Sullivan. AVell I made some. I paid on those houses.
The Chairman. But it is not on your account?
Mr. Sullivan, That is true.
The Chairman. How did you pay ?
ORGANIZED CIRIME IN INTERSTATE COMMERCE 309
]\Ir. Sullivan. Well, you have the records.
The Chaikman. You decided in 1950 to pay this ; is that it ?
Mr. Sullivan. No.
The Chairman. How are you going to list tliat additional amount
now
Mr. Suixivan. Just a minute, I can show you. Will you explain
how this is coming about, now?
Mr. Hall. If I may have that record?
Mr. Sullivan. These payments were not made by McQueen. There
was quite a few irregularities in there that I didn't know about until
I started checking them. In fact I w^anted to take your time here for
a few minutes just to show you about
The Chairman. Who is this McQueen you are talking about ?
Mr. Sullivan. Well, he was the fellow that was making my income-
tax report at the end of each year, and I was paying quarterly each
year, and I was paying all my income. I mean all the payments that
I was due to pay, and usually I would go over there and leave the
money there with him and he would pay it. Sometimes I paid it
myself.
Mr. Halley. Is Mr. McQueen alive ?
Mr. Suixivan. Yes, sir ; he is.
Mr. Halley. And is he is Miami ?
Mr. Suixivan. Well, he was about a week or so ago — 10 days or so
ago.
Mr. Halley. Is it your statement on the 1943 return that the chair-
man was asking about; that you filed an additional yellow sheet which
did show^ the income from the real-estate transactions?
Mr. Sullivan. My income taxes were made up from a yellow work-
slieet which was attached to the sheet of which I paid on, and the
payments were irregular. In fact I have a check here at the present
time of $1,800 that states that his office girl forgot somehow or other.
He was sick and they must have not sent it, sent the money. I have
a check here.
Here is a letter to Mr. Hunt, my attorney :
Dear Mr. Hunt : In regard to .Jimmy Sullivan, please find enclosed my personal
clieck, No. 1039, dated June 12. 1950, payable to James A. Sullivan for the sum
of .$1,826.22, to cover my statement of June 1, 1950. In view of my going to the
hospital for an operation, and no doubt will be confined for some time, I could
not wait for your reply to my letter and statement of June 3. Therefore, I am
mailing you this check to prevent any further delay. With kindest regards.
Yours truly,
Hardin McQueen.
INIr. Halley. Now Sheriff Sullivan, have you finished reading your
letter?
^Nlr. Sullivan. Yes, sir.
]Mr. Halley. Is it then, your testimony, for this need for a cor-
rected return in 1943 ; that this was due to some sort of mistake?
Mr. Sullivan. Well, I think it was. I was perfectly honest in
making my report out and I stated everything that I had made — that
I had sold, because it w^as on record in the courthouse.
Mr. Halley. Would you say that you simply made a mistake in
the years 1944, 1945, 1946, 1947."and 1948 ?
Mr. Sullivan. We have it in the record to show what happened.
We have many records to show of actually what happened.
310 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Now let's take 1944. There you find a return for
$5,564.77 ; is that right ?
Mr. Sullivan. Well
Mr. Halley. Do you have the original returns?
Mr. Hall. 1944?
Mr. Halley. The original returns for 1944 ?
Mr. Hunt. The Bureau has the original. Don't you have your
copy ?
Mr. Halley. Do you have a copy ?
Mr. Hall. In 1944 Form W-2 was filed.
Mr. Halley. And in 1944 who made the statement of income? I
don't believe you made any statement of income at all but simply paid
a tax ; is that correct ? 1 mean for the year 1944 ?
Mr, Hall. This was done at the end of the year.
The Chairman. Here it is, Mr. Hall. Just tell what that is.
Mr. Hall. This sheet of paper I have here is an original Form 1040
which was found in the files of Hardin McQueen out on Southwest
Eighth Street. He is the man who made up Mr. Sullivan's income-tax
returns. The W-:2 was turned over to the field deputy as follows:
$207.75, taxes withheld, $10.40. That Form W-2 is the employer's
statement that is given to employees showing the amount of income
tax withheld. The taxpayer, if he wishes, signs the original Form
W-2 and mails it in, which does away with the necessity of filling
out a long form of income-tax return.
Mr. Halley. So in 1944 he just didn't file a long form tax return?
]VIr. Hall. Well, the W-2 went to Mv. McQueen. Whether Mr.
McQueen sent the form in or did not, I don't know,
Mr. Halley. Well, on the long form, if the amount is over $5,000 you
can't use the W-2. You can't use the W-2 if a man's income is over
$5,000 ; isn't that correct ?
Mr. Hall. I believe that was correct in 1944.
Mr. Halley. And Mr. McQueen is an auditor?
Mr, Hall, Yes. He was not certified. If }' on look at his letterhead
you will find out w4iat his ca])abilities are. He is an examiner of
questioned documents; a handwriting expert; and a counselor on
Federal tax.
]Mr. Halley. Didn't you finally in 1950 file an amended long form
return for the year 1944?
Mr. Sullivan. Yes, I believe I did.
Mr, Hall, Yes, 1944, In 1944 an amended form was filed,
Mr, Halley. Now Sheriff Sullivan, do you think if you learned that
your own income-tax return was amended in 1944, that you could
state the sources of your account, or your income in 1944, as shown on
that return ?
The Chairman. Before he does that I want to see this short form
that was filed.
Mr. Hall. We don't have it ; the Government has it.
The Chairman. According to this, the only tax paid was $10.40?
Ml'. Si LLiVAN. That was tax withheld on that salary, and on tho
original return if it was sent in. The $10,40 was taken credit for by me.
The Chairman, His question was, what was the source of income
in 1944 as you finally listed it?
Mr. Sui^MVAN. Well, we liav(> a lettei (o sliow here.
ORGANIZED CRIME IN INTERSTATE COMMERCE 311
The Chairman. Well, Sheriff, you tell us. You tell us what the
source was.
Mr. Sullivan. He will have to tell me, I don't know^ anything about
these income taxes.
I Mr. Halley. Can you read? It is right on the return. You read
all morning. Just read it off the return, please.
Mr. Sullivan. All right.
Your exemption : Your name is James A Sullivan, and your wife is Ethel
Sullivan. Your daujihters are Dorothy May
Mr. Halley. Go ahead.
Mr. Sullivan. "The city of Miami, Miami, Fla. ; amount, $207.75."
Mv. Halley. That is income ^
Mr. Sullivan. The amount; yes, sir.
Mr. Halley. Tlie total income from the city?
Mr. Sullivan (reading) :
Enter total income here : $207.75. Enter here the total amount of your divi-
dends and interest, including interest from Government obligations, unless wholly
exempt from taxation, $77.02. If you received any other income, give details
on page 2 and enter the total here, $5,780. Add amounts in items 2, 3, and 4,
and enter total here, $6,064.77. If item 5 includes incomes of both husband
and wife, show husband's income here, $5,674.77. Wife's income here, $390.
Husband and wife — if husband and wife file separate returns, and one itemizes
deduction, the other must also itemize deductions. 6. Enter for your tax from
table on page 4, or from line 15, page 3.
I Mr. Halley. Now Mr. Sullivan, the question related to those parts
lof the tax as related to your source of income. I think it would now
Ibe ap])ropriate to turn to page 2 and state the source of additional
income that you referred to a few minutes ago ?
j Mr. Sullivan. That is the year that I ran for sheriff in 1944.
Political contributions, not expended, is $5,000.
\ Total income from above sources, $5,780.
Mr. Halley. Can you give any further explanation of that item,
"Political contributions, not expended"?
Mr. Sullivan. Well, this was the year 1944 that I was elected, the
year that I ran for sheriff, and I left the corner, and wdien the race
was over I had money left over.
Mr. Halley. And you happened to have $5,000 left over ?
Mr. Sullivan. Yes. It totaled up that, or a little bit better.
Mr. Halley. So you kept that?
Mr. Sullivan. I kept it ; yes,
Mr. Halley. As income ?
Mr. Sullivan. What was I to do wnth it ?
; Mr. Halley. Did something similar to that happen in your 1948
campaign, too?
Mr. Sullivan. Yes ; it did.
Mr. Halley. Will you state the facts with reference to 1948?
Mr. Sullivan. Well, the reference to the fact — it is after the race
was over that I had money left over — after the race was over.
Mr. Halley. How much did you have left over in 1948 ?
Mr. Sullivan. I had about, if I remember right — about the same
amount as I had the first time.
Mr. Halley. $5,000?
Mr. Sullivan. Around $5,000 or $5,600.
Mr. Halley. $5,000. And that was political contributions?
68958 — 50 — pt. 1 21
312 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Sullivan. Yes ; that was left over from my campaign.
Mr. Hallet. Now what led you to declare those sums as income
when y^ou filed these amended returns in 1950 ?
Mr.'SuLLivAN. What led me to do it ?
Mr. Hallet. Yes.
Mr. Sullivan. AVell, I had people, friends of mine, all over Dade
County telling me that the income-tax man had been there checking
on my income. I had a man come and ask me about my income tax,
and says they were asking him about it. I says, "Well, I don't know.
I have took care of all my income, every bit of it.'' He asked me had
I took care of it and I told him. He says, "Those records" — he came
to my office and told me this fii'st. I was downstairs in the courthouse
and pulled out these pages and he told me he was from the Tax
Department of the Internal Revenue, and he says, "I would like to
question you some about your income.'' "Well," I says, "It is all
right." And he says — -he sat down and talked with me for quite
a while in my office. Then he came back and told me at a later date
that if I didn't file any returns for 19— from 1944; that I didn't file
any from 1944. Well I told him I filed income for every year. I
says, "We made it out on the yellow sheet and the yellow sheet is
right here." The yellow sheet was right there every time that we
made our income out. "I have paid on it," I says.
Mr. Hallet. Well, while we have the interruption may I have the
original returns. The only one I have here is 1943. I would like
copies of the returns filed from 1943 to 1948.
Are you ready?
Mr. SuLi^ivAN. Yes, sir. I wrote a letter here, the first time I knew
that something was wrong with my income-tax returns. The letter
is dated November 30, 1949, to the collector of internal revenue, Jack-
sonville, Fla. :
Gentlemen : I find the accountant who made up my income-tax reports for
the years 1945, 1946, 1947, and 1948 did not keep an exact and detailed copy of
the reports sent to you. Would it be possible for yovi to obtain for me photostatic
copies of these four income-tax reports and let me have them? According to my
records I received $91. HO refund on my 194.1 income-tax report, of which I paid to
the Government $1,100. I paid $1,200 on my 1940 report, and should have received
a refund of $249.18 on this, but my records do not indicate that such a refund
was ever received.
I paid on the 1947 income-tax report, $4,894.18, and should have received a
refund of $726.72, but am unable to locate any such refunds as being received by
me. I paid $1,400 on my 1948 income-tax report and have not received any
refund on this at all. I would certainly greatly appreciate your assistance in
furnishing me with these photostatic copies of the above, so that I may have my
records clearly available. Thanking you, I am.
Very truly yours,
James A. Sullivan.
Or James Alexander Sullivan.
Mr. Haij.et. Mr. Sullivan, do you have anything else that you
want to submit?
Mr. Sullivan. Yes, sir; a letter from the Treasury Dei^artment, Mr.
Ilalh'y.
Mr. James Sullivan,
Box S0S8.
Dkak Mr. Sullivan : This is in regards to 194.1, 1946, 1947, and 1948 returns.
Receipt is acknowledged of your connnunication dated November :M). 1949, re-
(piesting photostatic copies of 194.1, 1946, 1947, and 1948 returns. Inasmuch as
the above-mentioned returns are not in this office, it will be necessary for this
ORGANIZED CRIME IN INTERSTATE COMMERCE 313
oflSce to requisition statements. However, upon receipt of tliese returns you will
be furnished pliotostatic c(»pies as quickly as possible. If tliis office can be of
further service to you. please advise.
Yours very truly, ^ ,
John L. Falis.
Mr. Halley. Here we have a copy of your 1948 return, don't we? I
show you a copy of your 11)48 return on the bottom of which is marked
in ink, signed, "JAS."' Tliere are some otlier names on it, indicating
that it is a copy of returns filed for 1948. Will you look at it and say
if it is the copy?
I don't understand. You were asking the Bureau of Internal Reve-
nue for a photostatic cojjy — why ? You had a copy.
Mr. Sullivan. My returns were not the same as the returns that
were here.
]Mr. Halley. They were not ?
Mr. Sullivan. No, sir.
Mr. Halley. What returns were here, and what returns did you
make?
Mr. Si'LLivAN. Well, there was much money that was paid that
didn't reach the Internal Revenue Department.
Mr. Halley. Isn't this the copy that you have had in the files right
along? That is, the thing right in front of you, right on top?
Mr. Sullivan. Yes, sir.
Mr. Halley. And it shows the total income of 1948, of how much
you made '( It shows $10,T04.3?>, and you have amended it now show-
ing a total income of $15,951.91, adding to it the $5,000 for campaign
contributions and expenses.
Now when you took office as sherijff in 1945, did you have any money
in the bank?
Mr. Si'LLiVAN. I don't know how much money I had in the bank
because I didn't keep much money in the bank.
Mr. Halley. Did you have $5,000 in the bank at that time?
Mr. Sullivan. I don't remember what I had in the bank.
Mr. Halley. January 1, 1945 (
Mr. Sullivan. I don't know. That is the year I left the police
department. I don't know how much money I had in the bank. I had
about $2,000—1 had $2,001.50.
Mr. Halley. How^ much did you have in the bank at the end of
1948?
Mr. Sullivan. $34,283.60.
Mr. Hallet. That was in one bank, but you had some money in
another bank.
Mr. Sullivan. I had in the Pan American Bank, $983.28, and I
had in the Riverside Bank, $1,187.32. In the Miami Industrial Bank
I had $424.64. I had in Treasury bonds, $1,068.75.
Mr. Halley. You had some other property at the end of 1948, did
you not, besides money in the bank?
Mr. Sullivan. Yes.
The Chairman. What is the total of money in the bank at the end
of 1948 ?
Mr. Hall. I can give you the figures.
The Chairman. Read those figures once more.
Mr. Hall. $34,283.60 in the First Federal Savings & Loan ; $424.64
in the Miami Industrial Bank; $1,187.32 in the Riverside Bank;
314 ORGAXIZED CRIME EST mTERSTATE COMMERCE
$983.28 in the Pan American Bank ; in XDOstal savings certificates there
were $201 ; United States Treasury bonds, $1,068.75.
That is all of the cash items.
Mr. Hallet. Wliat other assets were there at the end of 1948 ?
Mr. Sullivan. A note receivable to George L. Tiny Parker for
$1,000; accounts receivable, Ethel Balfe, $900; accounts receivable,
Sam Wallace, $300; the Hungarian Culture Club, $500; automobile.
Dodge sedan, $2,029, and another Dodge sedan, $1,629.79; a lot at
174 Beacom Manor, Southwest Fourth Street, $1,520.85 ; lots at 172
and 173 Beacom Manor, $3,013.95 ; lots 26, 27, 28, 29, and 40, Kenil-
worth, vacant. Southwest First Street, $4,575.90; lot 24 of block 14,
Brickell Estates, 261 Southwest Thirtieth Koad, $15,500; the Hen-
dersonville, N. C, residence was $8,000.
Mr. Halley. You bought that for cash, didn't you?
Mr. Sullivan. Yes.
Mr. Hallet. In what year ?
Mr. Sullivan. 1947.
Mr. Hallet. Is that place up in Hendersonville, N. C, in the same
general area as the summer house that a former chief of police, Mr.
Short, of Miami Beach, had his house in Hendersonville?
Mr. Sullivan. I don't know. I do know Police Chief Short. I know
him, but I didn't know him there. I never saw him up there.
Mr. Hallet. You don't know that he also has a house in Hender-
sonville ?
Mr. Sullivan. My place was in Laurel Park, just outside of Hen-
dersonville.
Mr. Hallet. You don't know that he also had a house there ?
Mr. Sullivan. No.
Mr. Hallet. From whom did you buy your house ?
Mr. Sullivan. From Ed Diehl in Homestead.
Mr. Hallet. Homestead where ?
Mr. Sullivan. Florida.
Mr. Hallet. For $8,000 cash?
Mr. Sullivan. That's right.
Mr. Hallet. Did you withdraw the money for that from the bank ?
Mr. Sullivan. Yes, I did.
Mr. Hallet. Did you pay by check ?
Mr. Sullivan. No ; I didn't get the check out of the bank; I got the
cash.
Mr. Hallet. You went to the bank and got $8,000 in cash out of it?
Mr. Sullivan. They wrote tlic check for $8,000; I don't, know
whether it was the check or the cash I paid ; I think it was cash.
Mr. Hallet. What did you hand the man you bought the house
from, check or cash ?
Mr. Sullivan. I don't know whether it was check or cash ; it was
o^ie or the other. "Wlien you get a check that is payable to you you
have to get the check cashed and get another check. It is a savings
account in the First Federal Bank here in Miami.
Mr. Halley. You got a cashier's check ?
Mr. Sullivan. Yes ; it is the same thing.
Mr. Halley. Did you go to the bank and put $8,000 in it and then
get a cashier's check?
Mr. SiTLLivAN. No ; I took it out of my funds in the bank.
Mr. Hallet. Out of what funds did you take it ?
ORGAlSnZED OREME EST INTERSTATE COMMERCE 315
Mr. Sullivan. I only had one fund down there in the bank ; I took
it out of that fund at the First Federal.
Mr. Halley. First Federal was a savings account ?
Mr, Sullivan. Yes.
Mr. Halley. Did you have $8,000 in the bank at that time ?
Mr. Sullivan. I had more in there ; I don't know how much it was.
Mr. Halley. I just want to get the date of the withdrawal from the
bank of the $8,000.
Mr. Hall. The Government already has all of these bank records.
Mr. Halley. IMiat was the date of the purchase ?
Mr. SltjLivan. Mr. Halley, I cannot tell you.
]Mr. Halley. Do you have a transcript of the bank account for 1947
with the First Federal Savings Bank ?
Mr. Hall. This is all that I have on that [hands papers to Mr.
Halley].
Mr. Halley. Don't you have any bank records for the year 1947 ?
Mr. Hall. If you will let me explain it I think we can save some
time.
Mr. Halley. Please do so.
Mr. Hall. The Bureau of Internal Revenue has been investigating
Mr. Sullivan for quite some time, and quite a few records have been
turned over to them, and all records that were available to us have
been made available to them, and they have them there, I am sure.
Mr, Joe Brown would be familiar with it. Most of the evidence that
we could find of Mr. Sullivan's financial position has been turned over
to them.
Mr. Halley. You must have a bankbook; did you give them the
bankbook ; did you give the bankbook to the Bureau ?
Mr. Sullivan. I have the bankbook at home. They have copies
of that also.
Mr. Halley. Right now we don't know whether you paid for this
house in cash ornot.
Mr. Sullivan, Out of the bank.
Mr, Halley, Did you take cash to the bank and buy a cashier's
check ?
Mr. Sullivan. No ; I got the cash out of the bank.
Mr. Halley. Are you sure of that ?
Mr. Sullivan. Yes.
Mr. Halley. Will you be sure to get the bank records here as soon
as possible ?
Mr. Sullivan. Yes.
]Mr. Hunt. The bankbook ?
Mr. Halley. Yes.
Mr. Hunt. Do you know whether either of the Levitts have a
house in Hendersonville, Jules or Leo ?
Mr. Sullivan. No.
Mr. Halley. Is it possible ?
Mr. Sullivan. It could be.
Mr. Halley, Do you know them ?
INIr. Sullivan. I don't know Jules or the other fellow. I know of
them but I don't know either one of them,
Mr. Halley. You have never seen them?
Mr. Sullivan. As far as I know I haven't.
316 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. H ALLEY. Will you ^o on with your net worth for 1948 ?
Mr. St'LLivAN. Lots 13 and 14 of block 13 of Northern Boulevard,
first tract, $3,689.40.
Mr. Halley. Is that the net value of that in 1948 ?
Mr. Hall. That is cost.
Mr. Halley. Book value ?
Mr. Hall. Yes.
Mr. Halley. Go ahead.
Mr. Sullivan. That gets everything. Against that there was a
mortgage to Brickell estates of $10,000. There was a note payable to
N. W. Carter for $1,883.33 ; there was an automobile from John Jones,
Inc., for $900.
Mr. Halley. Do your records show the total value of your assets
at the end of 1948?
Mr. Hall. No.
Mr. Halley. Total book value?
Mr. Hall. This doesn't include all of his assets.
Mr. Halley. You mean he has some more assets ?
Mr. Hall. Cash on hand. I have no way of finding out what that
was.
Mr. Halley. Was there cash on hand?
Mr. Sullivan. There must have been.
Mr. Halley. Do you have a safe-deposit box, Sheriff Sullivan?
Mr. Sullivan. No.
Mr. Halley. Does your wife?
Mr. Sullivan. No.
Mr. Halley. Did you ever own a safe-deposit box?
Mr. Sullivan. No.
Mr. Halley. Did your wife?
Mr. Sullivan. Never.
Mr. Halley. Did you keep sums of cash on hand?
Mr. Sullivan. Yes, I did. I had money in the Morris Plan Bank,'
where the Miami Industrial Bank is now, when it went broke.
Mr. Halley. Where did you have it?
Mr. Sullivan. In the Morris Plan Bank.
Mr. Halley, You mean in a bank account ?
Mr. Sullivan. I had it in that bank when the bank went broke.
That was right innnediately before I built the home at 1803 Northwest
Sixth Street. That bank went broke then and I didn't put any more
money in a bank at all for a long time.
Mr. Halley. You mean that after the Morris Plan Bank went broke
you became a little worried about banks?
Mr. Sullivan. After all I just put in what was necessary to have
in the bank.
Mr. Halley. When did that bank go broke?
Mr. Sullivan. It was either the first of 1937 or the last of 1936.
Mr. Halley. Foi- how many years did you keep from putting money
in the baidi?
Mr. Sullivan. Well, in 19;)9 I put money in a bank.
Mr. Halley. Did you ever discuss with Deputy Sheriff Burke your
joint unwillingness to ])ut money in banks?
Mr. Sullivan. What?
Mr. Halley. Did you ever have a talk with him about the fact that
neither of you liked the bank?
ORGANIZED CRIME IN INTERSTATE COMMERCE 317
Mr. Sullivan. I don't know whether I did or not. I don't know
that I did.
Mr. Halley. Isn't it a fact that at the end of 1948 you had total
assets in excess of $75,000?
Mr. Sullivan. I don't know what I had at the end of 1948. What-
ever is on here is right.
The Chairman. Mr. Sullivan, do you think in 1948 that $75,000
would be a reasonable appraisal of your assets?
Mr. Sullivan. It could have been; I sold some property in 1948.
I imagine it would possibly be around $70,000. I sold a group of lots,
seven or nine lots, in 1947 down here south of Fifteenth Road. I
don't know what subdivision they are in. I bought those lots for
$7,500.
Mr. Halley. You bought them right after you became sheriff,
didn't you ?
Mr. Sullivan. It wasn't long after I became sheriff.
Mr. Halley. You bought them for $7,500 ?
Mr. Sullivan. Yes.
Mr. Halley. Two years later you sold them for $25,000 ?
Mr. Sullivan. That's right.
Mr. Halley. From whom did you buy those lots ?
Mr. Sullivan. From the Railway Express Co.
Mr. Halley. To whom did you sell them?
Mr. Sullivan. I don't know. Who did I sell them to ? I don't know
the people. It was the first time I ever saw them, but they built some
big apartment houses on them, on the whole thing.
Mr. Halley. Your net on the deal was $17,500?
Mr. Sullivan. That's right. I borrowed five or six thousand dol-
lars, or something like that, at the time I bought the lots.
Mr. Halley. When did you buy your home?
•■ Mr. Sullivan. Which one ?
Mr. Halley. How^ many homes have you ?
, Mr. Sullivan. You mean the present one, the one I am living in
now ? Each one of my places I built were my homes. I lived in almost
all of them.
Mr. Halley. You bought a house in 1946, did you not?
, Mr. Sullivan. Yes, I did.
Mr. Halley. Do you live in that now?
Mr. Sullivan. No, I don't.
Mr. Halley. Did you ever sell it?
Mr. Sullivan. I sold it.
Mr. Halley. For how much?
Mr. Sullivan. For $10,500 ; no, $14,500 in 1947.
^Ir. Halley. Do you know a Mr. William Lee ?
^Ir. Sullivan. Yes, I do.
Mr. Halley. Did he handle the transaction in which you bought
a house in 1946 ? .
Mr. Sullivan. Well, at the place that I was living at that time he
handled the transaction of the place, in 1947, when I bought the house.
Mr. Halley. You bought a house in 1947 from the Lucky Corp.,
did you not?
Mr. Sullivan. That is true.
Mr. Halley. Are you living in that house now ?
Mr. Sullivan. No: I am not.
318 ORGANIZED CRIME IN INTERSTATE COMMERCE:
Mr. Halley. Did you ever live in it?
Mr. Sullivan. Yes; I did.
Mr. Halley. How long did you live in it?
Mr. Sullivan. Well, I lived in it, I guess, more than 4 years.
Mr. Halley. Have you sold it recently?
Mr. Sullivan. I sold it, yes, couple or 3 months ago.
Mr. Halley. What did 3^ou sell it for?
Mr. Sullivan. $14,500.
Mr. Halley. You bought it from the Lucky Corp. ?
Mr. Sullivan. I bought it from Ford — Carvel Ford.
Mr. Halley. You bought it from Carvel Ford ?
Mr. Sullivan. Yes.
Mr. Halley. Who is Carvel Ford?
Mr. Sullivan. Carvel Ford is a man that is from out in Illinois, ini
the restaurant business there.
Mr. Halley. When did you buy it from Mr. Ford ?
Mr. Sullivan. Well, I bought it in 1947 from Mr. Ford. I movedl
in the property sometime in 1946.
Mr. Halley. You rented it between 1946 and 1947 ?
Mr. Sullivan. I was supposed to pay rent on the property.
Mr. Halley. But you didn't? You had it rent-free?
Mr. Sullivan. Free with the exception of some, I think, aboutl
$300.
Mr. Halley. Who owned it in 1946 ?
Mr. Sullivan. Well, I guess Ford did, because he owned it wheaj
I moved there.
Mr. Halley. Did you ever hear of James Alexander Poulos?
Mr. Sullivan. Only in this return here.
Mr, Halley. What return?
Mr. Sullivan. In this investigation of this case here.
Mr. Halley. You mean about this house we are now talking aboutl
Mr. Sullivan. Yes.
Mr. Halley. Isn't it a fact that this house was bought by Mr. Lee
as agent from Mr. Ford ?
Mr. Sullivan. I don't know about that. I bought the house from
Ford.
Mr. Halley. Didn't Ford buy it in the name of a James Alexander
Poulos, and wasn't that really you ?
Mr. Sullivan. Not me, no.
Mr. Halley. Well, you moved right in, didn't you?
Mr. Sullivan. Did you say Ford bought it ?
Mr. Halley. I mean Lee.
Mr. Sullivan. I don't know who Ford bought it from.
IVfr. Halley. I meant Lee. Didn't Lee handle a transaction in
which the house was purchased in 1946 in the name of a James Alex-
ander Poulos? Your first name is James Alexander, isn't it?
Mr. Sullivan. That's right.
Mr, Halley. You have heard of James Alexander Poulos, have
you not?
Mr. Sullivan. Yes.
Mr. Halley. He has figured in this deal?
Mr. Sullivan. Yes, sir.
Mr, Halley, Has anybody been able to find him?
Mr. Sullivan, I don't know.
ORGANIZED CORIME IN INTERSTATE COOVTMERCE 319
]\Ir. Halley. Isn't it a fact that Mr. Lee handled the transaction
in which the house was purchased in 1946?
Mr. Sullivan". I don't know. I imagine that he did, because there
was a lot of unpleasantness about it at that time.
Mr. Halley. A great deal of unpleasantness ?
Mr. Sullivan. Yes, sir.
Mr. Halley. You remember that he gave a check for $19,968 ; isn't
that right? Did you know that?
Mr. Sullivan. I don't know about that.
]\Ir. Halley. You have heard about it though subsequently?
Mr. Sullivan. In this thing here, that's right.
Mr. Halley. And you moved right into it, is that right?
Mr. Sullivan. I moved in there after I sold my property over on
Southwest First Street.
Mv. Halley. And when did you sell your property on Southwest
First Street?
Mr. Sullivan. Well, I guess it was sometime in 19 — . Anyway
sometime in 1946, I believe. I believe it was sometime in 1946 when
I sold my duplex there on First Street, and I sold the property there,
and I didn't have no place to live at the time, to move to. This was
during the war.
Mr. Halley. So Lee let you live in this house, isn't that right ? Isn't
it Lee that you dealt with ?
Mr. Sullivan. No. And I stayed in my apartment, I believe, for
about 5 months after I sold the property.
Mr. Halley. You went into the house in 1946, didn't you?
]\Ir. Sullivan. Yes.
Mr. Halley. And you lived there, rent free, until November 12,
1947, wdien you bought the house ; isn't that right ?
Mr. Sullivan. With the exception of whatever payment that I had
made of, I don't know, three or four hundred dollars, whatever it
happened to be.
Mr. Halley. Now, you bought this house from a company called
the Luclry Corp., did you not?
Mr. Sullivan. Well, I bought it from Mr. Ford. I bought the
propertv from Ford.
Mr. Halley. No. The deed is from the Lucky Corp. to Sullivan,
isn't it?
Mr. SuLLLV'AN. I bought the property directly from Ford.
Mr. Halley. How could you have? Poulos bought the property
from Ford.
Mr. Sullivan. Yes, but
Mr. Halley. Are you the same as Poulos ?
Mr. Hunt. Which question do you want him to answer ?
Mr. Sullivan. I bought the property personally from Ford.
Mr. Halley. In what year?
■, Mr. Sullivan. Forty-seven, and there was quite a bit of misunder-
standing about this propertv, and I got a loan and bought the prop-
ertv. it was a loan of $10,000.
Mr. Halley. Who loaned you the $10,000?
Mr. Sullivan. Lee. I was living in the property, and Ford told
me that I could live in the property, and then the property was sold.
Mr. Halley. Isn't it a fact that Lee gave a check to somebody named
James Alexander Poulos, who bought that house for $19,968 in 1946,
320 ORGAXIZED CRIME IN INTERSTATE COMMERCE
and that you bouglit that lioiise from the Lucky Corp. for $15,500 in
1947, on November 12; is that right?
Mr. Sullivan. No. I bought the property myself from Ford.
Mr. Halley. But the deed is from the Lucky Corp., isn't it ?
Mr. Sullivan. Wherever the deed was, I guess it was.
Mr. Halley. Isn't William H. Lee the president of the corporation,
or wasn't he at that time ?
Mr. Sullivan. I believe so.
Mr. Halley. And you lived in that house, rent free, until Novem-
ber 12, 194T; isn't that right?
Mr. Sullivan. With the exception of the money that I paid on it.
Mr. Halley. Have you ever known anybody at any time in your life
by the name of Poulos?
Mr. Sullivan. I never knew him.
Mr. Halley. You never knew anybody at all by that name ?
Mr. Sullivan. I never knew^ him.
Mr. Halley. The question is: Did you ever know anyone by the
name of Poulos at any time in your life ?
Mr. Sullivan. I don't know. I don't remember.
Mr. Halley. Did you ever know anybody by the name of Poulos at
any time in your life — P-o-u-l-o-s?
Mr. Sullivan. I don't know him. I know that some people, that
Ford and Lee and some other party were around there. I know that
there was quite a bit of arguing going on at a number of different times.
Mr. Halley. Did you ever know anybody in your life by the name
of Poulis?
Mr. Sullivan. I don't believe I ever knew a Poulis.
Mr. Halley. Did you know anybody by the name of P-o-u-l-i-s?
Mr. Sullivan. Not that I know of.
Mr. Halley. In the meantime have you been able to estimate your
net worth at the end of 1948, or has your accountant been able to do it?
Mr. Hall. At the end of 1948 it was about $70,000.
Mr. Halley. You say about $70,000 ?
Mr. Hall. Yes, $70,000.
Mr. Halley, And that is w ithout taking into account cash on hand ;
is that right?
JSIr. Sullivan, That is everything, everything.
Mr. Halley, I will ask your accountant. Is that $70,000 figure
correct not including cash on hand ?
Mr, Hall. That does provide for $3,000 or $4,000 cash on hand.
Mr. Halley. Three or four thousand dollars cash on hand?
Mr. Hall, Yes. $68,000 would cover his net worth, including the
cash.
Mr. Halley. How much cash did you have on hand at the end of
1948?
Ml-. Sullivan, Well, that I can't definitely say,
Mr. Halley, What did you do with the $5,000 that was left over
from the 1949 campaign ; did you keep that in the form of cash ?
Mr. Sullivan. Well, I've got a record of that somewhere, right in
my re(!ords here. I kept it in cash for awhile until I got everything
all straightened out, and then put it in tlie bank and used it.
Mr. Halley. When did you de])osit it in the bank?
Mr. Sullivan. Well, oifhand, that is something I can't tell you
definitely.
ORGANIZED ORIME IN INTERSTATE COMMERCE 321
Mr. Halley. Well, you are looking at the record. You said you
deposited it in the bank.
Mr. Sullivan. This is a record of the financial report of July 12,
1950.
Mr. Halley. So the chances are that at the end of 1948 you had
that $10,000 cash that was left over at the end of your campaign?
Mr. Sullivan. I had it ; yes.
Mr. Halley. In cash?
Mr. Sullivan. No, I didn't have it all in 1948 in cash, I don't guess.
Mr. Halley. Where do you keep those large sums of cash? Your
own estimate admits that you had several thousand dollars in cash.
Mr. Sullivan. Yes, I have had, many times, yes.
Mr. Halley. Where do you keep it ?
Mr. Sullivan. I keep it at home. I keep it in my pocket, but I
keep it at home when I get large sums.
Mr. Halley. Where do you keep it at home ?
Mr. Sullivan. Well, I keep it rolled up in an old blanket and hid
up on a shelf.
The Chairman. Where is that?
Mr. Sullivan. I say I keep it rolled up in an old blanket on a shelf.
The Chairman. Rolled up in a blanket on a shelf?
Mr. Sullivan. Yes, sir; yes, sir; that is where I kept it. Well, I
kept money like that for years.
Mr. Halley. Have you ever kept it in a tin box ?
Mr. Sullivan. Well, no. I have kept money in a tin box, what we
call a fishing box.
Mr. Halley. Did you keep yours in a fishing box ?
Mr. Sullivan. No — I have, but I don't keep it in a fishing box now ;
I haven't recently.
Mr. Halley. How recently?
Mr. Sullivan.. Three or four years ago.
Mr. Halley. How much money ?
Mr. Sullivan. At times I have had quite a bit.
Mr. Halley. How much would be quite a bit ?
Mr. Sullivan. Well, I have had as much as $12,000 in there at one
time.
Mr. Halley. In a fishing box ?
Mr. Sullivan. Yes, sir.
Mr. Halley. At your home ?
Mr. Sullivan. Yes; but I don't keep it there long. I move it from
there, because it's dangerous.
Mr. Halley. How do you get into these large cash transactions?
How does it come about that you had accumulated $12,000 in cash?
Mr. Sullivan. Well", in my election in 1944 there was a lot of money
that was turned over to me in my campaign.
Mr. Halley. "Wliat would you say was a lot?
Mr. Sullivan. I don't know. There was quite a bit ; seven, maybe
$8,000.
Mr. Halley. Cash?
Mr. Sullivan. Well, over the whole period of time ; yes.
Mr. Halley. And were there some checks ? What was your entire
campaign fund in 1944?
Mr. Sullivan. Well, you see, other people spend money on your
election, and I know in my election I didn't spend much.
322 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Did you spend much in your election in 1948 ?
Mr. Sullivan. I didn't spend too much in my election in 1948.
Mr. Halley. How much did you spend in 1948 ?
Mr. Sullivan. Well, we have a limit on the money that we can
spend.
Mr. Halley. You mean a legal limit?
Mr. Sullivan. That's right.
Mr. Halley. No one pays any attention to that, does he?
Mr. Sullivan. Personally, what money you can spend yourself.
Other people can spend plenty of money or all they want. You are
allowed to spend, I believe, for sheriff, $1,500.
Mr. Halley. You are allowed to spend $1,500?
The Chairman. No ; it is more than that. I saw the report here.
Mr. Sullivan. Well, since the new law that they have put in there.
I believe they stated there was no limit to what they could spend for
an election. I believe that was what they testified here yesterday.
Mr. Halley. We are talking about before the new law\
Mr. SuixivAN. $1,500.
Mr. Halley. $1,500?
Mr. Sullivan. Yes, sir.
Mr. Halley. Why is it, if you knew you could only spend $1,500,
why would you accept contributions far in excess of that, so you would
have $5,000'left over to put in your pocket at the end of the election?
Mr. Sullivan. People spent this money for different contributions.
Mr. Halley. Wouldn't that $5,000 you had left over be just a cash
gratuity that you had received from your well-wishers, if you could
only spend $1,500?
Mr. Sullivan. I don't know so much about that; but, anyway, I
entered that into my — after talking with my auditor — I entered that
into my tax returns.
Mr. Halley. A^^io were some of your contributors in 1948?
Mr. Sullivan. In 1948 and in 1944 I have the names, in the two
elections; I have the names of these contributors.
Mr. Halley. Can you give them to the committee ?
Mr. Sullivan. Mr. Rolfe, who is the armored truck man, gave me
$500 when I was running for office.
Mr. Halley. In what year?
Mr. Sullivan. 1948.
Mr. Halley. Who else?
Mr. Sullivan. I believe, I think Mr. Withers gave about $1,500.
Mr. Halley. Don't you have any record ?
Mr. Sullivan. I don't keep any records of the money that was given
ill each case during election time.
Mr. Halley. You don't?
Mr. Sullivan. No, sir.
Mr. Hali.ey. How do you know that you had $5,000 left over?
Mr. Sullivan. When everything was counted up I had $5,000 left
over.
Mr. Halley. Wliat was the total you got in 1948?
Mr. Sullivan. Oh, it run about $5,600, $5,700, something like that;
fifty-five, maybe.
Mr. Hunt. He means the total of the contributions, I believe.
Mr. Sullivan. Well, those contributions come in different ways.
I don't know; it was considerable in 1948.
ORGANIZED CRIME IN INTERSTATE COMMERCE 323
Mr. Halley. It was far in excess of $5,600, wasn't it. Sheriff?
Mr. SuLLiVAX. Yes ; I guess it was.
Mr. Halley. Let us get the real figure now. You are under oath,
you know.
The Chairman. Sheriff, give us your best estimate of what it w^as.
Mr. Hunt. Do you mean the total or what was left over?
Mr, Halley. The total of what was given to him in contributions.
Mr. Sullivan. Well, I don't know. It went into my office down-
town ; personally, w4ien everything was all finished and all the records
were straightened out, I had about $5,500 or $5,600.
Mr. Halley. You mean that is what was left after the campaign?
Mr. Sullivan. Yes, sir.
Mr. Halley. What was there at the start of the campaign and what
did you collect altogether from contributors?
Mr. Sullivan. Well, the people gave me from time to time a lot of
money. So help me, I was out working and I can't tell you.
Mr. Halley. Did you get in contributions more than $10,000?
Mr. Sullivan. Probably through the whole election ; probably there
was more than that through the whole election.
Mr. Halley. ]\Iore than $20,000 ?
Mr. Sullivan. Oh, no.
Mr. Halley. I am talking about the 1948 campaign — contributions
for your campaign.
Mr. Sullivan. No, sir.
Mr. Halley. You are sure it was not as much as $20,000 ?'
Mr. Sullivan. No, sir.
Mr. Halley. Was it as much as $15,000?
Mr. Sullivan. Well, that could have been. It might have been^
Through my office downtown, in the downtown department, the whole
contribution to my election might have been more than that, but not
to me.
Mr. Halley. To you it was about $15,000, would you say?
Mr. Sullivan. No.
Mr. Halley. What was it to you ?
]\Ir. Sullivan. Well, I probably got around $5,500.
Mr. Halley. I thought you said that was what you had left over?
Mr. Sullivan. That's right.
Mr. Halley. Well, you must have spent something.
Mr. Sullivan. I spent, it cost me about, I don't know, around $1,400
myself, out of my own personal funds.
Mr. Halley. Out of your own campaign funds ?
]Mr. Sullivan. Yes, sir.
Mr. Halley. Out of your om'ii pocket?
^Ir. Sullivan. Yes.
Mr. Halley. You paid that out of your own money ?
Mr. Sullivan. Yes, sir.
Mr. Halley. You got only about $5,600 in contributions. Well,
low about your campaign headquarters; who runs your campaign?
Mr. Sltllivan. The whole election cost more than that, I guess.
Mr. Halley. We are talking about the campaign. Did you have a
leadquarters in 1948?
Mr. Sullivan. Yes, I did. I had a headquarters this side of the
'ourthouse.
Mr. Halley. Who was in charge of your campaign ?
324 ORGAXIZED CRIME IX INTERSTATE COMMERCE
Mr. Sullivan. Well, I had several people there in charge.
Mr. Halley. Name them, please.
Mr. Sullivan. I had Holmes Allen, who was in charge of part of
it, I had Bill Mcintosh, who was in charge of some of it, and my wife
was there from time to time.
Mr. Halley. Who handled the money ?
Mr. Sullivan. People come in there that left it ; whoever happened
to be there at the time they came in there. They would leave it there
with them. My wife was there most of the time.
Mr. Halley. Didn't you designate a particular person or persons to
handle your campaign funds?
Mr. Sullivan. My wife was there. I was around my campaign
headquarters very little, a very little bit.
Mr. Halley. And Mrs. Sullivan handled part of the money?
Mr. Sullivan. That's right ; part of it.
Mr. Halley. Who handled the rest of it ?
Mr. Sullivan. There was money spent in different places. There
was campaign headquarters that was set up on the beach. There was
campaign headquarters that were set up down in the Homestead
area.
Mr. Halley. Who handled the money in those places ?
Mr. Sullivan. They set it up themselves for me.
Mr. Halley. Then let us get back to your headquarters in INIiami.
Who, besides Mrs. Sullivan, handled the money and was responsible*
for finances?
Mr. Sullivan. Well, I guess Holmes Allen handled a big part of it ini
the run-off. In the first race he took care of a lot of the work, and II
guess he handled some of the money.
Mr. Halley. Do you know Jack Friedlander ?
Mr. Sullivan. I know who he is by these hearings that we have*
been having here.
Mr. Halley. Do you mean that you had never heard of Jack Fried-
lander before these hearings ?
Mr. Sullivan. Yes, sir.
Mr. Halley. Who is he ?
Mr. Sullivan. He is one of the reputed gamblers here in Dadei
County. He was arrested here a couple of years ago, I believe, fori
investigation. I don't know that he was charged with anything, but ho
was investigated for gambling.
Mr. Halley. Does he operate right in the city of Miami?
Mr. Sullivan. Well, I can't tell you that, whether he does on
not.
Mr. Halley. Where is the Club 86 ?
Mr. Sullivan. It's up on Biscayne Boulevard at Eighty-sixth!
Street.
Mr. Halley. Do you know an accountant named Costar?'
C-o-s-t-a-r? Charles B. Costar.
Mr. Si LLivAN. Who ?
Mr. Halley. Charles B. Costar.
Mr. Sullivan. Yes, I do. Wait a minute
Mr. Halley. He keejjs the books for the Club 8(i. Haven't you
ever gone up and asked him to show you the books for the Club 8'"
Mr. Sullivan. No : I haven't.
ORGANIZED ORIME IN INTERSTATE COMMERCE 325
Mr. Halley. Do you know what kind of a place the Club 8() is?
' Mr. Sullivan. They run gamblin*;.
Mr. Halley. It is in Dade County, is it not?
Mr. Sullivan. Yes, sir.
■ Mr. Halley. They still do, don't they?
• Mr. Sullivan. Xo.
. Mr. Halley. They did the winter before this?
Mr. StTLLivAN. No, I don't believe so.
Mr. Halley. Did you ever arrest any of the people connected with
the Club 86 ?
Mr. SuLLFv AN. I guess I did. I don't know how" many people worked
there, but we made a raid there.
Mr. Halley. One raid ?
r Mr. Sullivan. Yes, and we arrested fellows there and in other
places, at times, that we understood worked there.
Mr. Halley. After making a raid did you walk over to the ac-
countant's office and look at the books to find out who owned the
place ?
Mr. Sullivan. No.
Mr. Halley. Didn't you know that Jack Friedlander was one of the
owners of the Club 8G ?
Mr. Sullivan. No; I didn't.
■ Mr. Halley. You never heard of that before?
Mr. Sullivan. He was reputedly one of the owners with Charlie
Thomas and
Mr. Halley. Yarborough ?
Mr. Sltllivan. Yarborough, yes.
Mr. Halley. Then that information had come to you?
Mr. Sullivan. Oh, yes.
Mr. Halley. How much did Jack Friedlander contribute to your
campaign ?
Mr. Sullivan. Well, now, that I don't know.
Mr. Halley. He did contribute, didn't he ?
Mr. Sullivan. He could have.
• Mr. Halley. He did, didn't he ?
Mr. Sullivan. He could have ; I don't know whether he did or not.
Mr. Halley. What do you mean by "He could have"? I might
have, but I didn't.
Mr. Sullivan. There are a lot of different ways it comes in.
Mr. Halley. Did it come or did it not come?
Mr. Sullivan. Definitely I don't know.
Mr. Halley. What is your best guess; you are pretty sure that he
did contribute to your campaign, aren't you?
Mr. Sullivan. He didn't contribute nothing to me.
Mr. Halley. Did he contribute to your campaign?
Mr. Sullivan. In an indirect manner it might have happened.
Mr. Halley. Didn't he contribute to your campaign?
Mr. Sullivan. You are asking me directly. I can't tell you directly.
I don't know positively.
Mr. Halley. Do you think he contributed to your campaign?
Mr. Sullivan. He could have.
Mr. Halley. Did anybody ever tell you that he contributed to your
campaign?
Mr. Sullivan. No.
326 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Hallet. What makes you think he could have ?
Mr. Sullivan. You seem to be of the opinion that he did. Maybe
you have the knowledge.
Mr. Halley. If I know it, you will admit it ?
Mr. Sullivan. No. I said he could have. I don't know.
Mr. Halley. Do you know that it is contempt and perjury to say
you don't know something that you do know? I just want to be sure
tliat you understand that.
Mr. Sullivan. Yes.
Mr. Halley. If you say you don't know something when in fact
you do know, it is perjury.
Mr. Sullivan. But I don't know it.
Mr. Halley. Don't 3^011 know that Jack Friedlander contributed
$5,000 to your campaign? Let's have the answer without all of this
fuss ; answer it yes or no.
Mr. SuLLR^4N. I don't know that he did ; no.
Mr. Halley. Do 3^011 know that he didn't?
Mr. Sullivan. I don't know that he did or didn't.
Mr. Halley. I have no further questions.
The Chairman. Senator Hunt, do you want to ask the sheriff any
questions ?
Senator Hunt. No.
The Chairman. I have two or three questions. I was interested
in this honorary deputy sheriff business that you put out here. I
liappen to have a card here dated June 5, 1947, issued to Abe Allen-
berg. Is that a deputy sheriff commission that you issued?
Mr. Slt^livan. That is one of my cards. This, as you will see, is
not a signature of mine; it doesn't have my signature on that card.
You can see that yourself. This is a stamped signature on here.
The Chairman. I thought it was your signature.
Mr. Sullivan. However, let me say this while I am on the subject.
From what I personally know and have personally found out about
Abe Allenberg, as far as his work goes since I have been sheriff, I
have not definitely found out anything that has been wrong with
Abe Allenberg. He is associated with very nice and outstanding
people; he was elected president of the INIiami Beach Association. I
am not sure whether it was State president or State vice president.
Senator Hunt. President.
]\Ir. Sullivan. I don't like to slap somebody down that I don't
really know anything wrong about.
The Chairman. Sheriff Sullivan, you apparently keep a list of
your honorary deputy sheriffs. This seems to be No. 460. This one
here doesn't look like a stamped signature.
Mv. Sullivan. They are both stamped.
The Chairman. It looks like a genuine signature to me. Anyway,
is ho an honorary deputy sheriff or not?
Mr. SuT,LivAN. Well, he has this card, and I imagine that Mr.
Harkness issued this card to him.
The Chairman. You of course know that he was sent down here by
a person who has been characterized as one of the Nation's greatest
gamblers. Frank Erickson; that he has been in business with Mr.
Erickson; that he has managed the Wofford Hotel, and you have
seen the list of its clientele.
ORGANIZED OREVTE UST INTERSTATE COMMERCE 327
Mr. Sullivan. I have seen these lists up there quite a bit, but this
man here, if I am not mistaken, he and his group that he associates
Avith, were all before our State supreme court and I think they nolle
])i"ossed, or whatever happened to it. T know this happened a few
years ago out at the Tro])i('al Park, and I believe a few years ago there
Avas something pertaining to the ownership of the hotel, the Wofford
Hotel, on Miami Beach.
The Chairman. Do you recall the sheriff's convention when they
came down here in 1949 or 1948, or whatever time it was?
Mr. Sullivan. No. The sheriff's convention I believe came to Dade
County in 1944, the year I was elected sheriff.
The Chairman. Didn't you have one over at the Wofford Hotel
about that time ?
Mr. Sullivan. I believe that they had a convention there at that
time. I am not sure.
The CHAir.MAN. Just one other question, Sheriff Sullivan.
Mr. SuLLivAX. On this occasion we had a big dinner there sometime
in the year 1944. after I was elected sheriff. At that time we had all
of the State officials here ; that was in 1944. I think I had a sheriffs'
convention there in 1946 or 1947.
The Chairman. You know that when Mr. Allenberg left the
Wofford Hotel he went over to the Boulevard Hotel, don't you?
]\[r. Sitllivan. I saw him at the Wofford Hotel in 1944 and then
he was later at the Boulevard Hotel in 1940 or 1947.
The Chairman. You know that the Boulevard Hotel had a horse-
racing gambling place there?
Mr. Sullivan. No; I didn't know it. We raided the place. I
don't know whether it was one or two or three times that we arrested
them for horsebooking there.
The Chairman. Another question. You go to North Carolina
occasionally, and you go fishing once in a while, as anyone is supposed
to do. Does Mrs. Sullivan go with you fishing?
Mr. Sullivan. No ; she doesn't go with me fishing.
The Chairman. How about on the trips that you go on ?
Mr. Sullivan. Well, when we take our vacation, contrary to what
this gentleman got up here and stated yesterday about being gone
for 6 months, me and my wife have not been out of the State and away
from this office more than 16 days.
The Chairman. In other words, wdien you take your vacation she
goes witli you ?
Mr. Sullivan. Yes.
The Chairman. When you have a lot of money in the house in a
fishing box, what do you do with it when you go on a vacation ?
Mr. Sullivan. I have got the money now where I don't have to
worry too much about it. Maybe I have a little bit lying around.
The Chairman. I mean when you had $8,000, or whatever it was.
Mr. Sullivan. I had more than that there. I don't have any stick-
ing around in any fishing box.
The Chairman. You said in an old blanket in your closet.
Mr. Sullivan. Right.
The Chairman. Do you just leave it there when you go away?
Mr. Sullivan. Senator, if you look like you are a man that is worth
a lot of money, you can expect somebody to try to break into your
house, if they are looking for money. If you don't go around spending
68958—50 — pt. 1 22
328 ORGANIZED CRIME IN INTERSTATE COMMERCE
a lot of money and letting people know you have money, you don't
have to worry too much. Down in my office I have many, many people
who come in there wanting to borrow money, wanting to sell me stock
in this and that.
The Senator. Do you leave it at home when you go away on vaca-
tions ?
Mr. Sullivan. We don't leave it in the house, Senator.
The Chairman. You take it and put it somewhere else, or carry it
with you ?
Mr. Sullivan. That's right.
The Chairman. Do you have any further statements you want to
make. Sheriff Sullivan?
Mr. Sullivan. I would like to have, if you will permit me, Mr. Hall,
to kind of straighten out some of these things about my income tax.
1 don't know too much about this, and that's the reason I got messed
up in it before.
The Chairman. If Mr. Hall thinks he can straighten it out, he is
at liberty to do so.
Mr. Hall. Sheriff had his income tax returns prepared, as you
know, by Hardin McQueen, and as Mr. Sullivan stated, the income
tax information was placed upon a yellow^ work sheet
The Chairman. Are you speaking of what you know or what has
been told you ; did you see the yellow work sheet ?
Mr. Hall. I saw one of them. I saw where it had been removed
from the file.
Mr. Hunt. Senator, he will connect it up, if you will just permit him
to testify.
The Chairman. Go ahead.
Mr. Hall. I know that Mr. McQueen asked Sheriff Sullivan for
considerably more tax money than Mr. McQueen was putting on the
tax return. It was difficult for me to check this because at the time
special agents of the internal revenue were working on Mr. Sullivan's
income taxes, and it was hard for me to get Mr. McQueen to thoroughly
express himself as to what happened, however, I asked Sheriff Sulli-
van to carefully look for any receipt that he might have that Mr.
McQueen had given him. Mr. Sullivan was able to find a few receipts
showing payments, second installments and third installments, of
income taxes of $2,053 and $750. I have these receipts here, which I
will present to the committee.
The collector of internal revenue didn't receive that money, so we
have asked Mr. McQueen to reimburse Mr. Sullivan for this money
that was retained by him presumably. We have a check here recently
of $1,820, which is not all of it, but is part of it for the payments that
he retained.
I want to bring out that Sheriff Sullivan has paid in 2 years, 1947
and 1948, $2,629.19. Including the amended tax returns, as prepared
by me, tliis money here would have covered these shoi'tages. I asked
Sheriff Sullivan to let me include in his income tax $5,000 in 1944 and
1948, when he told me about the campaign contributions which had
not been expended. That is not income, and the Government doesn't
expect a tax on it; however, during the income-tax investigation Joe
Brown insisted that it was, contrary to rule IC No. 3270 which I
quoted. This rule No. 3270 saj^s:
ORGANIZED CRIME IN INTERSTATE COMMERCE 329
Such campaign contribution to political office seeker is not income.
However, to show (rood faith, I asked Sheriff Sullivan if we couldn't
put them in his return, and that is why these amounts were put in there
in 1947 and 1948. As soon as the examination is completed I intend
to file a claim for refund for the tax paid on these twM) amounts.
Mr. Hunt. Mr. Hall, are you able to testify the total ainount of
real-estate transaction profits Sheriff Sullivan has earned since he
became sheriff?
Mr. Hall. Yes. His profits, as reported in his income-tax return,
as prepared by me, showed a profit on the sale of real estate of $80,-
469.10. His salary durin<r that period was $51,843.12. His interest
and other income amoimted to $12,124.86. Total income accounted for
of $98,937.08. His net worth durino- that period increased $40,000,
which means that Sheriff Sullivan spent $53,000 in living expenses.
Mr. Halley. I don't quite follow you. ^'V^lat period are you cover-
ing?
Mr. Hall. From January 1, 1944, until July 12, 1950.
Mr. Halley. The period we have been following is for the period
on which you were able to fix his net worth, from January 1, 1945, to
January 1, 1949. As I recall it, you started out with something like
$2,000 in the bank, and a rather small amount of real estate, and
ended up w^ith a net worth in excess of $70,000 at the end of 4 years.
Mr. Hall. I would like to leave these two statements here, which I
believe will be self-explanatory.
Mr. Halley. I very much doubt it.
The Chairman. Anywav, he started off in 1945 with $3,000 in the
bank, and in 1948 he got it"up to about $38,000.
Mr. Hunt. You didn't count anything else in 1944, Mr. Chairman,
but yon counted everything in 1948.
Tlie Chairman, No. I was talking about money in the bank.
Mr. HtTNT. The 1948 total is everything that he owns.
Mr. Sullivan. In 1938 I didn't have any money in the bank except-
ing the bank that went broke.
Senator Hunt. Mr. Hall, your statement, collaborated in by the
sheriff, is to the effect that certain cash was given to Mr. McQueen
to remit to the Government for income taxes and it was not remitted?
Mr. Hall. That is right.
Senator Hunt. Would Mr. McQueen corroborate that statement ?
Mr. Hunt. We have letters from him, together with a contribu-
tion of $1,800 on the account, which we will be glad to submit to you.
Senator Hunt. Was any action of any kind taken toward Mr.
McQueen ?
Mr. Hunt. Mr. McQueen has been advised that the sheriff will sue
him for the balance. He has been in the hospital; he had a cataract
or some kind of an eye operation. As I have stated before, he has
remitted $1,826.22. There is a balance of $900, and he has been advised
that we will sue him for the balance.
Senator Ht^nt. Did the sheriff know how much money he had left
with Mr. McQueen ?
Mr. Hltxt. Mr. Hall can answer that.
Mr. Hall. He doesn't know^ all of the moneys that he left with
Ml-. McQueen. The only thing- that I could ask Mr. McQueen to
reimburse him for was the amount that I could prove. I have a
330 ORGAXIZED CRIME IN INTERSTATE COMMERCE
copy of my work sheet here, which I will be glad to present, showing
tlie source of the information and how I was able to prove that Mc-
Queen had received the money from Sheriff Sullivan and that he didn't
send it in to the collector of internal revenue.
Senator Hunt. What is your proof that the money was left with
Mr. McQueen and that it was left in cash ?
JNIr. Hall. I have the receipts here. Here are some photostatic
copies of receipts. I have the originals also. My statement as to
Mr. McQueen was developed from four main sources; first, receipts
that McQueen himself issued to Sheriff Sullivan showing that he had
received moneys for income-tax payments that were not sent in to
the Government ; also bank deposit records that were furnished by Mr.
McQueen to me; the record of the collector of internal revenue, Jack-
sonville, Fla., and canceled checks drawn on the sheriff's account and
charged to the sheriff's account.
Senator Hunt. When the sheriff signed his final income-tax return
the amount of money being remitted was on the face of that return,
wasn't it?
Mr. Hall. I think Sheriff Sullivan should answer that question.
I know the answer. He signed blank returns after McQueen made
up the yellow work sheet, and Sheriff Sullivan thought, up until re-
cently, that it was a part of the regular income-tax return.
Mr. Sullivan. Senator, let me say one word here. Mr. McQueen
has made up my income-tax returns since either 1938 or 1939. He
used to make them for me when I was a police officer on the corner.
He would come by and I would tell him what I had and he would go
to his office and tell me how much extra I owed, which I paid.
Senator Hunt. Sheriff, you sign income tax returns in blank?
That is the statement that Mr. Hall made.
Mr. Sullivan. I would sign them because I had no reason to not
do it. He had taken care of me all the time before, and he didn't
charge me nothing but $5 while I was a policeman on the corner,
so when I got to where I could do a little better, I paid him more
money each time he took care of my income taxes. I didn't know
but what he was a regular income tax man and that he was recognized
by the Government as such. When I started checking they told me
something else. They told me that they would make me new books
and that they would show me how to make my income tax reports
out, and that McQueen is not much of an income tax man, and that
they didn't think too much of him. I know that he had one of those
things hanging on the wall showing that he was an accountant.
Senator Hunt. A certified public accountant?
Mr. Sullivan. Yes, a certified public accountant; he had it there
on the wall. He told me that he could sit down with the Govermnent
tax men and work things out with them. He said that they advised
with him from time to time and he advised with them, and I had
no reason to disbelieve it. I never paid any attention to what was
going on. The first thing I knew of it is when one of the income tax
men told me that he didn't place much confidence in him and that is
when I thought I had better start doing something about it and find
out where I stood.
Senator Hunt. You didn't offer to do anything about it until the
internal revenue people were investigating your income tax return?
Mr. Sullivan. That is when I learned it.
ORGANIZED CRIME IN INTERSTATE COMMERCE
331
Mr. Hunt. I would like to state that Mr. McQueen first remitted
$700. After I had written a letter to him he came in the office and
remitted $700, and I returned it to him. After two or three more
letters to him he sent in $1,826.22, or whatever that amount is.
The Chaieman. I think the record should show these figures with
respect to Sheriff Sullivan's income tax return.
Year
Per return
Corrected
Year
Per return
Corrected
1943
$2, 387. 75
5, 564. 77
6,150.00
$7, 033. 51
5,591.02
7, 836. 87
1946 . .
$6, 436. 51
16, 270. 92
9,159.42
$.36,511.07
1944.
1947
20, 323. 48
1945-
1948 . . ..
19, 109. 40
The Chairman. I have never understood exactly how you could have
in 1944 a net worth of $2,500 or $3,000 and then in 1948 you could
have $70,000 or $75,000 net worth, after paying expenses and what not
during that time. What is the explanation of that ?
Mr. Sullivan. Well, Senator, I don't know how much in salary
The Chairman. You made $7,500 for a while and then $10,000.
Mr. Sullivan. Yes.
The Chairman. Beginning with 1945 to 1948 that is a discrepancy
of $2,500, and in the course of 3 years you show a net worth of $75,000.
Mr. Sullivan. What time?
The Chairman. From 1945 until 1948.
Mr. Sullivan. I sold this piece of property for $25,000, which I
bought for $7,500, which took care of a big part of that. My total
earnings for that period was $30,469.10 in real estate, and my salary
amounted to $51,343.12.
The Chairman. That is over the whole period of time. I was talk-
ing about the difference between the end of 1944 and 1948, which repre-
sents 3 years. Your salary would not be $50,000 for 3 years.
Mr. Hunt. That would be 4 years.
Mr. Sullivan. I tried to put in my income-tax returns everything
that I made, and I tried to get in all of the bills that I had when they
came to me. When it came to the question of these additional improve-
ments that I put on the property that I bought they told me that I had
to get all of these bills that were several years old. You can't get all
of those bills unless you keep an accurate record of what you put on
any building.
The Chairman. Is that your explanation?
Mr. Sullivan. Yes.
The Chairman. We will file this as exhibit No. 163. (Exhibit No.
163, Financial statements of Sheriff Sullivan, ap)pears in the appendix
on p. 787.)
The Chairman. Mr. Hunt asked me to read this statement into the
record, which I will now do :
I woii'ld like the record relative to the elisor matter to show that although
I took issue with Judge Milledge upon legal grounds only, I have a deep regard
for his ability and fairness as a circuit judge.
EicHARD M. Hunt.
The Chairman. The committee will stand recessed for 5 minutes.
(Recess.)
332 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. Yesterday Melvin Richard had considerable to say
about Mr. Plissner. The chairman received this morning a telegram
from Mr. Plissner, reading as follows :
Melvin Richard perjured himself before your committee this afternoon. I
will be in your hearing room tomorrow ready to testify under oath. Richard is
trying to use your committee to advance his political fortunes. I am an innocent
man who lias been libeled and slandered by Richard. If you are interested in
justice and fair play you will call on me and listen to my story.
Harry Plissxer.
TESTIMONY OF HARRY PLISSNER, MIAMI BEACH, FLA.
The Chairman. Do you solemnly swear that the testimony you will
give this committee will be the truth, the whole truth and nothing
but the truth, so help you God?
Mr. Plissner. I do.
The Chairman. You may proceed, Mr. Plissner.
Mr. Plissner. Before this committee yesterday, Melvin J. Richard
attacked my character and my respected position in the Miami Beach
community. Richard has published his charges previously in news-
papers and magazines throughout the country.
Tliese charges have been broadcast on Nation-wide radio book-ups.
They have now placed on record by a committee of the United States
Senate. They are serious charges, and as such they deserve the atten-
tion of your committee. But these charges are not true. In his zeal
to settle a political dispute, Melvin Richard has perjured himself
before a committee of the Senate of the United States.
Yesterday Richard attempted to link my name with the criminal
underworld which this committee is investigating. I am grateful
that the committee, in the performance of its duties, has given me the
opportunity to defend my name and character against the perjured
testimony of Melvin Richard.
Richard perjured himself when he denied under oath that I had
told him the names of the men who wished to operate punchboards
in Miami Beach. On the only occasion on which we have ever dis-
cussed punchboards I told Richard, "Jerry Greenwald wants to know
if you can arrange for him to operate punchboards.*' Richard, who
is Greenwald's attorney, replied, "Jerry must be kidding," and we
went on to discuss other matters.
If the committee has any questions regarding this very brief dis-
cussion between myself and Richard, I shall be glad to answer them.
What I wish to make evident now is that Melvin Richard knowingly
gave false testimony to this committee yesterday.
For some time now Richard and I have been engaged in a political
controversy bearing on local conditions in the city of Miami Beach.
For political motives Richard has sought to destroy my reputation
by manufacturing the story of an attempted bribe on my part, a story
based on the conversation whose entire substance I have just stated.
On Noveuiber 16, 1940, the Miami Herald re])orted an address
delivered by Richard to the INIiami Beach AMVETS. In this address
Richard stated that he had been offered a bribe of one-fifth of a
$2r)(),()()0-a-year ])unchboard business. Two months later, in an inter-
view published by the St. Louis Post-Dispatch, Richard repeated this
story. But l)y fJanuary Richard's one-fifth share had multiplied from
$50,000 to $2()0,000.
f
ORGANIZED GRIME IN INTERSTATE COMMERCE 333
Havin<!: reached the top-income bracket, Richard then became
national news. He passed his story on to syndicated cohimnists, to
radio commentators, and to one of the most widely circulated of the
slick magazines.
At some point in the development of Richard's bribe story, people
who had seen punchboards in operation in other parts of the country
began to wonder how an annual profit of a million dollars or even —
to take another of Richard's figures, $250,000 — could be made by
operatino; them on Miami Beach.
Tourists don't play punchboards. It takes time to raffle off a punch-
board, and tourists don't stay here long enough. The 40.000 perma-
nent residents of Miami Beach, buying chances at a few cents apiece
certainly were no source of a million dollars annually. Richard's
story made very little sense to anyone who thought about it, and he
had done such an excellent job of promulgating this story that people
in Miami Beach couldn't help thinking about it. Some of these peo-
ple were newspapermen and local radio commentators, and their
understandable skepticism was the substance of the "scurrilous at-
tacks" to which Richard referred in addressing this committee yester-
At this time Richard Avas under heavy pressure in this community
to present his unquestionably serious charges to a grand jury. The
local newspapers, civic organizations, and hundreds of prominent citi-
zens demanded that he present his story under oath and that he dis-
close the name of the alleged attempted briber. From the first Rich-
ard has described this person in such a way that no one in this com-
munity had any doubt of his identity, but Richard had not openly
called me by name.
Under this pressure Richard finally did appear before the grand
jury, reported the bribe offer and named me as its source. At that
time he also took the liberty of repairing an extraordinary and amaz-
ing oversight in his earlier accounts of the bribe. For the first time
he now recalled that not only had he been asked to connive at punch-
boards but bookmaking was also included in the package.
By this time Richard had evidently learned just wdiat a punchboard
is and how implausible his original story had appeared. Bookmaking
plugged the hole in this earlier draft of the story, and it now made
sense, untrue as it was.
I should like to point out to this committee, however, that in his
testimony yesterday Richard reported the take on this protean gam-
bling deai to be $750,000, not $1,000,000, not a quarter of a million. The
story still appears to be in the process of revision.
Now I have known Richard for a good many years and most of this
time quite intimately. I know his faults in a way that I hope no
other man will ever experience them, and I also know that Richard is
very good at certain things. He is especially skillful in remembering
facts which may be important to him at a future time. And yet
Melvin Richard has said on different occasions of the very same bribe
offer that it was $50,000, $150,000, $200,000.
For 8 months, moreover, Richard apparently forgot that book-
making, compared to which punchboards are hardly worth mention-
ing, was part of the so-called deal. It is possible that Melvin Richard,
who has built his campaigns on his claim that the take from Miami
334 ORGANIZED CRIME IN INTERSTATE COMMERCE
Beach bookmaking is $16,000,000 a year forgot about bookmaking
when he spoke to the AM VETS, to the St. Louis reporter, to Bob
Consicline and Drew Pearson and only mentioned punehboards. Or
is the truth of the matter that Miami Beach coukl never have produced
a milhon dollars a year for punehboards, that Richard realized this
at last, and that he was forced to promulgate a new fiction in order to
make the rest of his story stick.
If Richard's memory appears weakened now, more than a year since
he was allegedly offered a bribe, he appears to have been even more
forgetful directly after the date on which he claims to have been
offered the bribe. That date, by Richard's sworn testimony, was June
15, 1949. On June 22 of that year, however, Richard announced to
the press that Ben Danbaum, a man of the highest character who I had
introduced to Richard, was his choice for police chief of Miami Beach.
And 2 months later, at a regular meeting of the city council, Richard
again proposed Danbaum, my selectee for the job, as his candidate.
Still later, in October, Richard named me as his choice for member-
ship in the local housing authority. As witnesses I can name Mar-
Echal Rothe, Miami Herald reporter, Burnett Roth of our city council
(there are six other members besides Richard and Mayor Harold
Turk of Miami Beach).
Still another month went by and in November I was unanimously
elected a member of the city planning board. Melvin Richard was
present and voting. I refer you to the minutes of the city council.
These actions on Richard's part clearly indicate that long after
June 15, 1949, I enjoyed Richard's respect and was regarded by him
as a valuable member of our community, in spite of the criminal be-
havior which he now attributes to me as of that date.
These appointments which I had received also indicate something
else of importance on my behalf. For several years I devoted the
greater part of my time toward helping to make Miami Beach a better
place for decent people to live. For a part of this time Richard was
my ally. He is now one of the few enemies I have ever had. But I
have continued to think in terms of the betterment of Miami Beach,
and I shall always do so. I have led an honest, honorable life, I have
raised a family of which I am very proud. I have never placed a bet
with a bookmaker. I have never taken bets. I have never entered
a gambling house.
Gentlemen, I am almost ready for your questions, but before I do
that I would like to read into the record the ruling of Judge Holt
when he dismissed the indictment against me on a writ of habeas
corpus.
This is from the Miami Daily News of March 20, 1950:
Holt Ruuis Indictment Against Plissner Void
Circuit .Tudge George E. Holt ruled today that the grand jury Indictment
chax-ging Harry Plissner with attempting to b'ribe Miami Beach Councilman
Melvin .T. Richard is invalid, illegal, and void.
Plissner had taken the case to the circuit court 10 days ago in a habeas corpus
action in which he sought to quash th& indictment.
Judge Holt, in a three-page opinion, stated that he saw in the indictment "the
ugly and evil specter of a political and partisan battle." He stated that the
indictment returned a month ago, does not charge a crime, and he criti<"ized
the Jury for returning the indictment without seeking th'e advice of the State's
attorney or a competent lawyer.
ORGA]SriZE,D CRIME IN INTERSTATE COMMERCE 335
Referring to the reported $200,000 bribe Plissner is alleged to have offered
Richard to permit "horse-booking" and punchboard operation at Miami Beach,
Jndge Holt said :
"The Miami Beach charter fails to disclose in any particular that the office
of councilman has any legal authority whatsoever to enforce or relax the
enforcement of the laws of that city in this respect.
"It is purely a legislative office, nothing more, nothing less. Responsibility
to enforce the laws of the city rests elsewhere.
"It therefore follows that, where one does not possess requisite authority
under law to enforce the ordinances of the city, a bribe or an offer of a bribe
not to enforce certain regulations certainly does not contravene or violate any
law of the city or the State. One cannot be bribed to do something he is power-
less to do."
Judge Holt added that "here we find the ugly and evil specter of a political
and partisan battle, combined with a dissolved political partnei'ship, being
brought into the grand-jury room by one against the other in this personal
fight, apparently to punish one of the parties and gain an advantage over him
by the other partner."
Since the indictment does not charge a crime, Judge Holt stated, it constitutes
a serious invasion of Plissner's constitutional rights.
The action, he wrote, "despoils and abrogates not only the letter of the Consti-
tution but its very spirit. If one is indicted and later acquitted by trial, the
shadow and onus of the same will hang over and becloud his name and reputa-
tion tlie rest of his life."
In his opinion. Judge Holt pointed out that the grand jury should not be used
as a club by a minority against the majority ; by pressure groups seeking to
obtain that which has been denied them through other sources ; by anyone who
wishe.s to nullify and void the very basis and essence of democratic government:
the will of the majority of the people.
"If this be done," he continued "the grand jury be used for these purposes,
then every vestige of constitutional liberty and freedom will soon vanish, and
a new era of witch-burning and night-riding vigilantes will come upon us;
lawlessness will spread over the land "
The Chairman. How much Ion o^er is that statement ?
Mr, Plissner. Just one more minute.
Tlie Chairman. Well, that isn't your statement. You can put it
in the record, but that is the statement of a judge, and it doesn't
particularly seem to bear on the matter in question here.
Anything else, Mr. Plissner ?
Mr. Plissner. No. I am ready and willing to answer all questions.
Mr. Richards has had a holiday in the Miami Herald and in the Miami
Daily News, which have continually been his source of publicity. I
have had no opportunity to have a public forum. I am ready and
willing to answer any and all questions.
The Chairman. Mr. Plissner,, did you appear before the grand
jury that indicted you in this matter?
Mr. Plissner. I sent them a letter offering to appear and waive
immunity, but they refused to listen to me.
The Chairman. Mr. Plissner, have you ever been arrested ?
Mr. Plissner. I was arrested once. I was arrested in Springfield,
Mass., because I had sent out some coin-operated digger machines to
some people there; and when the police of Springfield, Mass., told
them they could not operate they asked them if they would permit
them to have a trial. The trial was going to be a test case.
The Chairman. Mr. Plissner, you were arrested then in connection
with some slot machines or something ?
Mr. Plissner. I volunteered for a trial, and I have here a photo-
static copy of a newspaper where I walked in and said, "In order to
have a test, I am ready and willing to submit to a test," and here is a
photostatic copy of the report of the incident as it appeared in the
336 ORGANIZED CRIME IN INTERSTATE COMMERCE
papers: "Plissner offers self for test." And this happened in 1935 in
Massachusetts.
The Chairman. Have you been convicted?
Mr. Plissner. Yes, sir.
The Chairman. How much time did you serve?
Mr. Plissner. I didn't serve at all. I paid a fine of $50.
The Chairman. Well, have you operated any slot machines?
Mr. Plissner. I wish to amend that last answer. I was a little
excited and said that. I am now calmed down. What I meant was
that I had one conviction which was in Sprino-field, Mass., and that
case was a test case where I offered myself. I was arrested about
four or five times in my entire life. They had to do with the opera-
tion of coin-operated devices. I was in the penny-arcade, shooting-
gallery business. In every case the case was dismissed. Four of the
cases, I believe, had to do with licenses not being in the machines, and
wdien they were brought into court I said, "The licenses are in there.
They probably fell down." Then when they opened them up they
found that the licenses were there.
In the fifth case, I believe I was charged with operating a gaming
device. It was a penny machine, and when it was brought to court
the case was dismissed. So, the only conviction I ever had was this
one on a digger machine in Springfield, Mass., and I submitted myself
in that case.
The Chairman. Weren't you arrested quite a number of times in
Baltimore
Mr. Plissner. I want to point this out to you-
The Chairman. And you were convicted in Springfield ?
Mr. Plissner. I think
Tlie Chairman. I don't want to go into the details.
Mr. Plissner. I tliink it is very unfair.
The Chairman. Let me ask you this : Since about 1933 you have
been in the vending-machine business in one way or another up until
the time you came to Miami Beach about 2 years ago; is that true?
Mr. Plissner. No ; that is not true.
The Chairman. Didn't yoti start out in New York
Mr. Plissner. I was in the
The Chairman. In the Crane Machine Vending Co.?
Mr. Plissner. No. My concern was Dreslow & Plissner. We were
in the jobbing business, and we sold clocks, watches, and jewelry, and
we sold to stores, and we sold to ^^arious carnival people. At that
time we were promoting some carnival people to buy these digger
machines. If we bought them for them, they would operate them
and they would buy the goods from us.
That is how we got into the vending-machine business.
The Chairman. That is the Charles Sales Co.?
Mr. Plissner. I don't even know what the Charles Sales Co. is.
The Chairman. And then you operated the Springfield Novelty
Co. in Springfield, Mass.?
Mr. Plissner. That was part of the Dreslow & Plissner outfit.
The Chairman. They were at 175 Fifth Avenue, New York City?
Mr. Plissner. That was our nuiin office from which we supplied all
our ])laces.
Tlie Chairman. Louis Blatt, is he your brother-in-law ?
Mr. Plissner. Yes.
ORGANIZED CRIME m INTERSTATE COMMERCE 337
The Chairman. And after that time you then went down to Balti-
more, Md.
Mr. Plissner. xVnd I operated a penny arcade.
The Chairman. And operated the Mount Royal Novelty Co.?
Mr. Plissner. Yes, a penny arcade.
The Chairman. Were you arrested in connection with that opera-
tion ?
Mr. Plissner. Yes. I just explained. I would like to point out
that I was in Baltimore for 7 or 8 years and had the place open 7
days a week and 24 hours a day, and I found myself arrested for only
havino' a license misplaced; and in one incident, where the police
thou<>ht they had something, we went into court and it was thrown out.
They said it was a legal machine.
The Chairman. After you operated in Baltimore you operated three
penny-arcade machines in Fort Meade, Md. ^
Mr. Plissner. Yes ; and to cater to thousands of soldiers and never
have a single arrest out in Camp Meade, in a period of 3 years, I think,
is a remarkable record.
The Chairman. After that you opened a warehouse at 641 Wash-
ington Boulevard?
Mr. Plissner. Yes. I went out and bought a lot of salvage goods,
and I went into the manufacturing business.
The Chairman. You operated a shooting gallery?
]\Ir. Plissner. Yes. I operated four of them.
The Chairman. So, you are very familiar with the vending-machine
business?
Mr. Plissner. I certainly am, and I never was in any part of it that
was illegal.
The Chairman. All right, that is all, Mr. Plissner.
Mr. Plissner. Thank you very much.
The Chairman. I believe Mr. Wolfson is here. He has some other
engagement, and he has to get away.
Mr. Wolfson, do you solemnly swear that the testimony you will give
this committee will be the truth, the w^iole truth, and nothing but the
truth, so help you God?
Mr. Wolfson. I do.
TESTIMONY OF LOUIS WOLFSON
The Chairman. Mr. Halley, do you have any matters you want to
ask Mr. Wolfson about?
Mr. Halley. Your name is Louis Wolfson ?
Mr. Wolfson. Yes, sir.
Mr. Halley. What is your business?
Mr. Wolfson. I am associated in the Capital Transit Co. in Wash-
ington, D. C, and am also the largest stockholder in the Merritt,
Chapman & Scott Corp. in New York City. I also have other interests
in theaters throughout the South and properties throughout Florida
and supply businesses in Orlando and Jacksonville, Fla,
Mr. Halley. Do you have other businesses?
Mr. Wolfson. Well, I have stock in other corporations.
Mr. Halley. Are you active in the management of any other busi-
nesses ?
Mr. Wolfson. No, sir.
338 ORGANIZEI) CRIME IN INTERSTATE COMMERCE
Mr. Halley. What business interests do you have in Florida ?
Mr. WoLFSON. We have theaters in Tampa, Fla.
Mr. Halley. Theaters?
Mr. WoLFsoN. Yes. And in Jacksonville, Fla. ; supply businesses
in Orlando, Fla., and in Jacksonville, Fla. Capital Transit is my
principal interest.
Mr. Halley. What kind of supplies ?
Mr. WoLFSON. Industrial supplies.
Mr. Halley. Building supplies ?
Mr. WoLFSON. Yes, sir. Also have real estate in Tampa, Fla., and
throughout Jacksonville.
Mr. Halley. Did you contribute to the campaign of Fuller Warren,
the Governor of Florida, in 1948 ?
Mr. WoLFSON. Yes, sir.
Mr. Halley. How much did you contribute ?
Mr. WoLFsoN. I don't recall exactly now, but it was substantial.
Mr. Halley. Would you give your best recollection ?
Mr. Wolfson. It was in excess of $150,000.
Mr. Halley. In excess of $150,000?
Mr. WoLFsoN. Yes, sir.
Mr. Halley. Was that a personal contribution by you ?
Mr. WoLFSON. Yes, sir; it was.
Mr. Halley. Was it solely your own money ?
Mr. WoLFSON. Yes, sir.
Mr. Halley. You obtained no part of your contribution from any-
one else?
Mr. WoLFsoN. No, sir.
Mr. Halley. In what form did you make your contribution ?
Mr. WoLFsoN. Part in cash, part by checks.
Mr. Halley. How much of it did you contribute in cash ?
Mr. WoLFsoN. I have no idea.
Mr. Halley. Half?
Mr. WoLFSON. No. I think it was less than half.
Mr. Halley. And the remainder in checks?
Mr. WoLFsoN. Yes, sir.
Mr. Halley. To whom did you turn over your checks? I mean, to
whom did you turn over your contribution ?
Mr. WoLFsoN". The original contribution was turned over to Julian
Fant who was treasurer of the Warren campaign.
Mr. Halley. How much was the original contribution?
Mr. WoLFSON. $25,000.
Mr. Halley. And there were subsequent contributions ?
Mr. Wolfson. Yes.
Mr. Halley. How much ?
Mr. WoLFsoN. I know it exceeded $150,000, but I don't know the
exact amount.
Mr. Halley. And to wliom were the subsequent contributions made ?
Mr. WoLFSON. The majority of it went to Julian Fant
Mr. Halley. Did some of it go to other people?
Mr. WoLFsoN (continuing). State treasurer. Yes, sir. It went to
other county lieadquarters.
Mr. Halley. Would you state the persons to whom tlie other con-
tributions went ?
lORGAJSriZED ORIME EST INTERSTATE COMMERCE ' 339
Mr. WoLFSON, Some of it was contributed to Dade County. I sent
it direct to Dade County headquarters. I also sent it to the Hills-
borough headquarters. There were others but those are the — I also
sent it to the Jacksonville headquarters. There were othei^, but those
three are the three particularly that I know.
Mr. Halley. That is a very substantial contribution you will agree,
would you not ?
Mr. WoLFSON. Yes, sir.
Mr. Halley. As a matter of fact it is far in excess of the amount
that is permissible under the State law as you probably know.
Mr. WoLFsoN. No, sir. I had no knowledge of any limit on con-
tributions.
Mr. Halley. You do know that now, don't you ?
Mr. WoLFSON. No, sir ; I still do not.
Mr. Halley. Whether or not you knew that you realized that you
were making a very unusual contribution, did you not?
Mr. WoLFSON. I realized it ; yes, sir
Mr. Halley. Would you state your reasons ?
Mr. WoLFSON. Fuller Warren had been a long-time friend of mine.
With the investments that I and my associates have in the State of
Florida and what I saw in the future if Fuller Warren was elected
Governor it would be well worth any investment that any businessman
would have made and had him elected Governor of Florida.
I think he is one of the outstanding salesmen that I have ever seen
and if there is any man that can sell the State of Florida the present
Governor of the State of Florida can sell it.
Mr. Halley. What investments did you have at that time that would
be enhanced ?
Mr. WoLFSoisr. Well, we are one of the largest holders of real estate
in Duval County. We also have properties in Tampa, Fla. We have
theaters in Tampa and Jacksonville. We probably have assets in
excess of $7,000,000 or $8,000,000 in the State of Florida.
Mr. Halley. Did you discuss your contribution with any persons?
Mr. WoLFsoN. Well, yes, I probably did over a period of time.
Mr. Halley. With whom did you discuss it during the time of the
campaign and prior to the campaign?
Mr. WoLFSox. Well, with the State committee.
Mr. Halley. Did you discuss it with William H. Johnston?
Mr. WoLFSox. If I did it was discussed at a finance committee
meeting. He probably was present at the time, but I never had any
direct discussion with INIr. Johnston.
Mr. Halley. Did you know him ?
Mr. WoLFSON. Yes. I have seen Mr. Johnston around Jackson-
ville for the last 10 to 15 years.
Mr. Halley. It has been stated that you, Mr. Johnston, and Mr.
Griffin agreed to split the cost of the campaign three ways between
you. Is that so ?
Mr. WoLFSox. Well, when I came into the campaign it was under-
stood that the three of us would carry the bulk of the campaign.
Mr. Halley. What were you after, and as for the other two, did
you find out what they were after?
Mr. WoLFSON. Yes. I definitely made it clear. When I went into
the canipaign I stated to the Governor and also to Mr. Johnston and
Mr. Griffin that if they had any commitment from the Governor, the
C}4U ORGANIZED CRIME IN INTERSTATE COMMERCE
then candidate for Governor I was not interested in making any con-
tribution, I was not interested in having my part in the election of
the Governor, of this Governor.
Mr. Halley. Did you know at that time that Mr. Johnston was
president of several dog tracks in Florida ?
Mr, WoLFSON. No, sir. I didn't know his connection. Of course,
I knew he was associated with dog tracks, but I didn't know in what
capacity. I thought perhaps he was head of the tracks due to the
community chest drives and the Red Cross campaigns that I par-
ticipated in with him to which he always made contributions, but I
didn't know he was head of the dog tracks.
Mr. Halley. Did you know that he headed a race track in Chicago?
Mr. WoLFSON. Well, not directly, but I have heard hearsay, and I
have heard him say that he had to leave the State during the cam-
paign and go up to Chicago to open a horse track.
I w^asn't too much interested in what his connections were or what
his business interests were.
Mr. Halley. Did you study the various Florida election laws care-
fully at that time ?
Mr. WoLFSoN. No, sir ; I never did.
Mr. Halley. Did you know that it was illegal for a man connected
with a racetrack to make a contribution to a campaign ?
Mr. WoLFSoN. No, sir; I didn't know Mr. Johnston was in this
campaign until after I got into it, and I had no knowledge of there
being any illegality of a man being connected with racetracks.
Mr. Halley. You knew that he put in just as much as you did,
didn't you ?
Mr. WoLFSON. No, sir, I still don't know that any man in the
State of Florida put in as much money as I did in this campaign.
Mr. Halley. Who handled the finances?
Mr. WoLFSON. Mr. Julian Fant was State treasurer.
Mr. Halley. Did you ever ask him for an accounting?
Mr. WoLFSoN. No, sir. I had the utmost confidence in Mr. Fant.
And when this amount got far in excess of what I originally agreed to
put in they approached me and told me the thing was bogging down,
and we were to try to stick.
Mr. Halley. What did you originally put in ?
Mr. WoLFSON. $25,000.
Mr. Halley. That you gave to Mr, Fant originally ?
Mr. WoLFSoN. Yes, sir.
Mr. Halley. Who approached you and told you it would cost more?
Mr. WoLFsoN. I was a]5proached by Mr. Fant and Mr. Griffin and
probably others telling me there was urgent need for more funds.
Mr. Halley. Wasn't it originally agreed that you, Griliin, and
Johnstim would share the costs of the campaign and keep other
money out ?
Mr. Wolfson. Well, I don't think it was a definite agreement. It
was talked that the three of us — there was talk that the three of us
would carry the bulk of this campaign.
Mr. Halley. That is in fact what happened, isn't it?
Mr. Wolfson. Well, from the information that I have that is
appai'ently what should have ha})])ened, but since he was elected Gov-
ernor thei'e is talk that a lot of other people made contributions that
I know nothing about.
ORGAXIZED ORIME IN INTERSTATE COMMERCE 341
Mr. Halley. Who are some of the other people?
Mr. WoLFsox. Well, just hearsay. I understaiul that peo})le locally
made $1,000 contributions or $500, after the election they said that
they had made contributions and asked for consideration.
Mr. Halley. What kind of consideration?
Mr. WoLFSON. Well, they never did tell me. Of course, I advised
them to oo down to State headquarters and tell thenu
Mr. Halley. Did you expect any consideration for your contribu-
tion I
Mr. WoLFSON. No, sir. The oidy consideration I expected was this,
for this governor to be an outstanding governor and sell the State of
Florida.
Mr. Halley. Well, you were in the business of selling supplies,
Averen't you?
Mr. WoLFSoN. Well. yes. We have sold supplies to the State of
Florida for the last 20 years.
Mr. Halley. To the State of Florida?
Mr. WoLFsoN. Yes, to the State of Florida.
Mr. Halley. And have you sold them to the State while Fuller
AVarren has been Governor ?
JNIr. AA'oLFsox. During his time in office we have done less business
with the State of Florida than prior to any other administration in
the State.
Mr. Halley. Was that a surprise to you?
Mr. WoLFSON. No, because it made no difference to us as far as
the sup])ly business with the State of Florida is concerned.
Mr. Halley. How long have you known Fuller Warren?
Mr. WoLi<\s()x. I would say 15 or 20 years.
Mr. Halley. Have 3'ou contributed to other campaigns of his?
Mr. AVoLFsox. No, sir. This is the first campaign contribution I
ever made to him.
Mr. Halley. Can you explain why in the past you never contributed
to his campaigns?
Mr. WoLFsox. Well, when he ran for Governor in 1940 I wasn't
in a financial position to make a contribution that I was in the position
to make at a later time. I also never made any contributions to any
political campaign during the early forties.
Mr. Halley. It has been said that after the campaign was over in
1948 you had a disagreement with Governor Warren and you were
quoted in the newspapers as having made statements about gambling
in the State of Florida and that you thought there should be a probe
about it. Is that so?
Mr. WoLFsox. No, sir. That wasn't exactly the facts.
I would like to state at this time that I have absolutely no connection
with crime, have not had any in the past and do not intend to in the
future. I am a businessman and I have been a businessman doing
manual work all my life. I think all this publicity that is appearing
in the papers is hurting this State and some authority ought to dig
into this thing and straighten the situation out. The only thing I
did was make a statement to the Governor. I made no recommenda-
tions. The only thing I told him was that something should be done.
Mr. Halley. Did he follow your reconnnendation ?
Mr. WoLFSox. That I cannot answer.
Mr. Halley. I have no other questions.
342 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. Mr. Wolf son, liow old are you ?
Mr. WoLFSON. Thirty-eight.
The CiiAiRiMAN. Thirty-eight?
Mr. WoLFSoN. Yes, sir.
The Chairman. You have several brothers, I understand.
Mr. WoLFSON. I have four brothers.
The Chairman. Your home is in Jacksonville?
Mr. WoLFSON. Yes, sir.
The Chairman. You made a large part of this money in the last
few years, I understand, in the last 8 or 10 years.
Mr. WoLFSON. Well, I know that I paid through the companies that
I either control with my brothers or have an interest in income taxes an
amount on an income in excess of $7,000,000.
The Chairman. In excess of how much ?
Mr. WoLFsoN. $7,000,000.
The Chairman. Ton and your brothers ?
Mr. WoLFSoN. My family ; my brothers and inyself ; yes, sir.
The Chairman. How do you operate, as a partnership or do you
each operate individually?
Mr, WoLFSON. No, sir. We have many corporations and I think we
have a couple of partnerships.
The Chairman. The Capital Transit Co. is one of your invest-
ments ?
Mr. WoLFSON. Yes, sir. That is a recent investment.
The Chairman. You own the controlling stock ?
Mr, WoLFSON, Yes, sir, with my brothers and associates.
The Chairman. It has been stated in the papers — I have forgotten
the amount — how much you paid for your interest in the Capital
Transit Co.
Mr. WoLFSoN. Do you now want to know ?
The Chairman. Yes.
Mr. WoLFSON. Originally $2,250,000, but we have increased our
holdings since then.
The Chairman. The original investment was just something over
a majority?
Mr. WoLFsoN. No, sir. It was just below a majority and we have
increased it to a majority.
The Chairman, Was all of this money that you put in the cam-
paign a donation or was some of it loaned ?
Mr, WoLFsoN, No, The entire amount that I put in the campaign
was a contribution.
The Chairman. It was out of your own personal funds?
Mr. WoLFsoN, Yes, sir.
The Chairman. It wasn't corporate funds?
Mr. WoLFSON, No, sir.
The Chairman, Mr, Wolfson, do you know Alvin Brody out in
Los Angeles?
Mr. WoLFsoN. Yes, sir. I met him on two or three different occa-
sions during the Governor's wedding. I think they had open house
at his home.
The Chairman. At 211 Montevo Road, Brentwood, Calif. ?
Mr. Wolfson. I don't know the address, but at his home.
The Chairman, Do you know Steve Brody ?
Mr, Wolfson, Yes, sir.
'ORGAlSriZED CRIME ITS' INTERSTATE COMMERCE 343
The Chairman. What business were the Brodys in?
Mr. WoLFSON. Well, Mr. Steve Brody was president of the Mono-
gram Pictures Corp.
The Chairmax. Wasn't Alvhi Brody one of the directors of Mono-
gram Pictures?
IMr. WoLFsON. No, sir ; not to my knowledge.
The Chairman. AVlio is Mr. Fagelson? Do you know anyone by
that name?
Mr. WoLFsoN. No, sir. The name doesn't register.
The Chairman. Did you buy any interest in the Monogram
Pictures ?
Mr. WoLFSON. Yes, sir. I was the largest stockholder in Monogram
Pictures.
The Chairman. When did you buy Monogram Pictures ?
Mr. WoLFSON. In 1947 or 19-i8.
The Chairman. How big an interest did you buy ?
J^Ir. WoLFsoN. I had 100?}00 shares of stock out of 760,000.
The Chairman. I mean, how much does your investment represent
in money ?
Mr. WoLFsoN. About $400,000.
The Chairman. You had about that much investment or still have?
Mr. WoLFsoN. iSTo, sir. I sold my interest.
The Chairman. You sold your interest out ?
]\Ir. WoLFSON. Yes, sir.
The Chairman. When ?
Mr. WoLFSON. About a year ago.
The Chairman. Did Monogram Pictures give you a note for about
$300,000 when you sold out ?
Mr. WoLFsoN. Yes, sir. They gave us a note in excess of $300,000.
The Chairman. How much was the note that you got ?
Mr. WoLFsoN. My original transaction with Monogram also cov-
ered some interest in pictures that we had in partnership with Mono-
gram Pictures. We sold out to Monogram for, in the neighborhood,
including the stock transaction, of about $1,250,000 and took about
$586,000 notes.
The Chairman. Notes of various amounts ?
Mr. WoLFSON. Yes, sir.
The Chairman. What did you do with those notes ?
Mr. WoLFsoN. Well, a majority of the notes have been paid off. I
held the notes and they were paid off on a w^eekly basis and I also
have some notes in trust for some stock I sold and they are paying on
the basis of $5,000 a month to the officers of Monogram and their at-
torney who bought my interest out.
The Chairman. AYlio did you sell the notes to? Who did you sell
any of these notes to ?
Mr. WoLPsoN. I didn't sell any of the notes.
The Chairman. Did you assign any of them to anybody ?
Mr. Wolfson. Yes, sir.
The Chairman. Who did you assign them to?
Mr. Wolfson. Originally I assigned them to the Atlantic National
Bank in Jacksonville in trust.
The Chairman. Who else did you assign them to?
Mr. Wolfson. I don't recall any other notes that were assigned.
The Chairman. Were any
68958 — 50 — pt. 1 23
344 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. WoLFSoN. I think we held the notes and they were paid on a
weekly basis.
The Chairman. AVere any New York people involved in this deal?
Mr. WoLFSON. No. I neo:otiated with New York banks, but they
didn't want to take the notes.
The Chairman. You didn't assign any notes to anybody who lives
in New York ?
Mr. WoLFSON. No, sir. To the best of my knowledge, I don't believe
I did.
The Chairman. Did yon have one note for $300,000, do you
remember ?
Mr. WoLFSON. No, sir. I am pretty sure that I had a note for
$350,000 which was against the stock that is assigned to the Atlantic
National Bank in trust.
The Chairman. The Atlantic National Bank in Jacksonville?
Mr. WoLFSON. Jacksonville; yes, sir.
The Chairman. Who is it in trust for? *
Mr. WoLFSON. In trust for the Walter E. Heller Co., in Chicago.
The Chairman. What is that?
Mr. WoLFSON. They operate a commercial credit company. They
are a banking institution, commercial banking.
The Chairman. Did you go out to California in connection with
this Monogram Pictures deal ?
Mr. WoLFSON. Yes, sir. I have been out there a number of occa-
sions.
The Chairman. Well, who did you make the transaction with ?
Mr. WoLFSON. Closing out the transaction?
The Chairman. Yes, sir.
Mr. WoLFSON. Mr. George Berle. I think his title is secretary of.
Monogram Pictures. And their attorney. I don't recall his name.
He is general counsel of Monogram. The two of them visited with
me in my office and we closed the transaction. ,
The Chairman. How did you happen to get interested in Mono-
gram Pictures?
Mr. WoLFSON. Well, we saw the possibility of getting into the
motion-picture field. We thought it was a good opportunity. AVe
also thought we had one of the most outstanding motion pictures of
modern time. The Babe Ruth Story. And we got deeper and deeper
into the motion-picture field after that.
Tlie Chair^ian. Who in New York is interested, if anybody, in the
Monogram Pictures Co., do you know?
INIr. Wo'LFsoN. No, sir.
Tlie Chairman. Did you have any dealings with anybodv in New
York about that?
Mr. WoLFSON. No, sir. My deals were primarily with George Berle
and Steve Brody, the president of Monogram.
The Chairman. Mr. Wolfson, just as a matter of interest you went
out. I believe for the wedding in California?
Ml-. Wolfson. Yes, sir.
The Chairman. Now, tell us you own the Tampa Shi|) & Drvdocks
Co.? * ' .
Mr. Wolfson. No. We own the Tampa Shipbuilding Corp.
The Chairman. How many ships do you have, or, does this company
own?
ORGANIZED ORIME IN INTERSTATE COMMERCE 345
Mr. WoLFSON. Well, the company is liquidated now and all we have
is the land and the building.
The Chairman. What is the Jacksonville company?
Mr. WoLFSON. We operate under the name of Wolfson Bros, in
Jacksonville, formerly the Florida Pipe & Supply Co.
The Chairman. Do you have any ships that are owned by that
company ?
Mr. AVolfson. No, sir.
The Chairman. Do you own any ships at all, or your interests?
Mr. Wolfson. No, sir. I have a small boat of my own, but that is all.
The Chairman. Do you have any big transport ships?
Mr. Wolfson. No, sir.
The Chairman. Did you have any in the last 2 or 8 years?
Mr. Wolfson. No, sir.
The Chairman. This Tampa company — is that a shipbuilding com-
pany ?
Mr. Wolfson. Yes. They operated building ships for the Navy
during the war, and after the war built ships — 35,000 ton ships —
for the French Government.
The Chairman. When you took it over, did it have any ships there?
Mr. Wolfson. Yes. They had one Navy ship that was incompleted.
Tlie Chairman. But yen iiever had any ships that could be used for
conveying cargo or anything of that sort?
Mr. AVoLFSON. No, sir.
The Chairman. Did you have any dealing with any of the Rocke-
feller interests in connection with your ship activities?
Mr. Wolfson, No, sir; not to my knowdedge.
The Chairman. That you know.
]\Ir. Wolfson. No, sir.
Tlie Chairman. Who is the manager of the Tampa company now ?
]\Ir. WoLFsox. Well, the company is liquidated now.
The Chairman. Who was the manager?
INIr. Wolfson. The latest president was P. B. Brill.
The Chairman. And of the Jacksonville company, of the Jack-
sonville AVolfson company?
Mr. Wolfson. My brother Saul is ])resident.
The Chairman. Any further questions?
Mr. HaliJ':y. Just one question. Did you ever get back any of your
contributions to the campaign of Fuller Warren?
Mr. Wolfson, No, sir. I am not counting on getting it back. I
never did expect any of the contributions back.
Mr. H ALLEY. And you never did get any of it back ?
Mr. Wolfson. No, sir.
Mr. Halley. That is all.
The Chairman. Thank you very much, Mr. Wolfson. We are sorry
tb have inconvenienced you.
Mr. Wolfson. That is quite all right. Thank you.
The Chairm vn. The witnesses who are in attendance better contact
Mr. Halley or his staff as to when they will be called to appear. The
committee finds itself in the position of less than a third of the wit-
nesses being called so that we are going to have to have a night session
and then a session tomorrow. I, therefore, suggest that the witnesses
in attendance get in touch with Mr. Hallev to see which ones will be
346 ORGANIZED CRIME IN INTERSTATE COMMERCE
called tonight and wliich tomorrow so as to inconvenience as few
people as possible.
The committee will recess now until 8 : 30 tonight. We will start at
8 : 30 sharp.
(At 6 : 30 p. m. a recess was taken to 8 : 30 p. m.)
EVENING SESSION
The Chairman. The committee will come to order. In the begin-
ning I neglected to introduce a representative of the Judiciary Com-
mittee, Mr. George Green, who is assigned by the Judiciary Committee
to assist in this investigation. On my right is Senator Wiley's ad-
ministrative assistant, Mr. Julius Calm. Senator Wiley, for reasons
beyond his control, is unable to be present. Mr. Julius Cahn is here
representing Mr. Wiley, and he is on Mr. Green's right.
Mr. Schine, do you solemnly swear that the testimony you will give
this committee will be the truth, the whole trutji, and nothing but the
truth, so help you God ?
Mr. ScHiNE. I do.
TESTIMONY OF MEYER SCHINE, MIAMI BEACH, FLA.
Mr. Halley. Mr. Schine, what is your occupation ?
Mr. Schine. I am in the theater business and also operate hotels.
Mr. Halley. Do you own any hotels in the State of Florida ?
Mr. Schine. Directly, I don't ; no. A corporation owns them and,
in turn, a corporation which I have stock in owns them.
Mr. Halley. Do you control the Roney Plaza Hotel at Miami Beach ?
Mr. Schine. Yes ; indirectly I control it.
Mr. Halley. Do you also control the Boca Raton Club ?
Mr. Schine. Yes; indirectly.
Mr. Halley. Do you also control the Hollywood Beach Hotel ?
Mr. Schine. No.
Mr. Halley. Did you at one time ?
Mr. Schine. No.
Mr. Halley. Just the Roney Plaza and the Boca Raton ?
Mr. Schine. Well, we also have the McAllister here.
Mr. Halley. The McAllister Hotel in Miami ?
Mr. Schine. Yes; and another hotel and apartment house, known i
as the Gulfstream.
Mr. Halley. Where is that located ?
Mr. Schine. That is in Miami Beach.
Mr. Halley. What is the name of the corporation through which i
you control the Roney Plaza ?
Mr. Schine. The name of the corporation is the Schine Theaters.
Mr. Halley. You mean that the theater chain owns the Roney
Plaza?
Mr. Schine. No, sir.
The Chairman. What is the name, Mr. Schine?
Mr. Schine. The Schine Theaters. They don't own it; they own
stock.
Mr. Halley. What is the direct owner of the Roney Plaza?
Mr. Schine. The corporation.
ORGANIZED CRIME IN INTERSTATE COMMERCE 347
Mr. Halley. The stock of the Roiiey Plaza is held 100 percent by
Schine Theaters ?
Mr. Schine. Yes.
Mr. Halley. And you control Schine Theaters?
Mr. Schine. My brothers and I own all the stock in the Schine
Theaters.
Mr. Halley. Mr. Schine, at various times have there been book-
makins: concessions rented out at the Roney Plaza and the Boca
"Raton Hotels?
Mr. Schine. Only twice at the Eoney Plaza. I might preface this,
if you don't mind. We acquired the Roney Plaza in '44, and I had
previously rented a cabana in the place, and when I acquired it I had
a chance to know what was going on and immediately we cleaned
house.
Mr. Halley. When did you acquire it ?
Mr. Schine. January 1, 1944.
Mr. Halley. Through the corporation ?
Mr. Schine. Yes. And we cleaned out everybody, and we ran
strictly without any bookmaking at all.
Mr. Halley. For how long ?
Mr. Schine. For 3 years.
Mr. Halley. From '1944 to 1947?
Mr. Schine. Yes. But in the meantime I had a great many com-
plaints by the guests. The guests complained, and there was going on
bookmaking on the quiet. And I complained to the manager, and the
manager said he can't stop it.
Mr. Halley. Who was the manager? Was it Carroll at that time?
Mr. Schine. Carroll was, up to 1946, and then Lang became man-
ager in '46.
Mr. Halley. Neal Lang?
Mr. Schine. Neal Lang ; yes.
Mr. Halley. Is he the same Neal Lang who managed the Wofford
Hotel?
Mr. Schine. I don't think he ever managed the Wofford. I didn't
know that he did.
Mr. Halley. Wasn't he connected with the Wofford ?
Mr. Schine. I didn't know he was connected, except I saw in the
paper something about it. I understood he had managed a hotel called
the Raleigh.
Mr. Halley. He had only been with the Raleigh ? Wasn't he one
of the original people to go with the Wofford ?
Mr. Schine. I wouldn't know that. He had left town. When he
came back he was hired as assistant manager by Carroll, and then
Carroll left us and he took his job as manager. And he was manager
there for, I think, 21^ years.
Mr. Halley. I show you a copy of a lease between the Roney Plaza
Corp. and various individuals. Was the Roney Plaza a corporation?
Mr. Schine. Was the Roney Plaza a corporation ?
Mr. Halley. Yes.
Mr. Schine. Well, I don't know what you mean.
Mr. Halley. Is there such a thing as the Roney Plaza Corp. ?
Mr. Schine. I think so.
Mr. Halley. When did you buy the Roney Plaza ?
Mr. Schine. In 1944.
348 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr, Halley. What month?
Mr. ScHiNE. January 1, 1944.
Mr. H ALLEY. And the corporation that owned the hotel directly was
called the Roney Plaza Corp. ?
Mr. ScHiNE. .1 don't know what the name was of the corporation. I
think probably that is the name.
Mr. Halley. Didn't that corporation, in the beginning of 1944,
shortly after you bought the hotel, execute a lease to Harold Salvey
and Charles Lebin ?
Mr. ScHiNE. Oh, I'll tell you what happened. When we took over
there was a cigar stand in the lobby, and we had no cigars or cigarettes
or newspapers or magazines, and I asked Carroll to get some, and he
couldn't, and finall3% lie brought down this — one of the men — and the
lease was made for the cigar stand, and they agreed to pay something
like $5,000 for the lease. And after a week I found they were making
book, and we canceled the lease and gave them the money back; but
we allowed them to run the cigar stand without rent, provided they
didn't make book.
Mr. Halley. Didn't you know at that time that Harold Salvey's
business was bookmaking?
Mr. ScHiNE. No; I didn't.
Mr. Halley. You have learned that since ; have you not ?
Mr. ScHiNE. I have seen it in the papers, that is all; but when we
found they were making book we canceled the lease and gave them the
money back. We agreed to let them stay at the cigar stand without
rent.
Mr. Halley. Thereafter, you did a lot of bookmaking at the Roney
Plaza ; did you not ?
Mr. ScHiNE. No.
Mr. Halley. Has there ever been a book there?
Mr. ScHiNE. Yes; but I told you for 3 years we didn't have any.
Then in '47 the manager called me up — I was Nortli — and he said thati
it was impossible to keep bookmaking out of the hotel ; the guests de-
manded it and there was a lot of sneak bookmaking, as they call it.
Mr. Halley. Wlio was your manager then ?
Mr. ScHiNE. Mr. Lang.
Mr. Halley. Lang^
Mr. ScHiNE. Yes. And I said, "Well, I'm coming up shortly and I"
will discuss it with you." And I came up and we talked, and I said,
"I hate to have it."
"Well," he says, "I've got about nine of them now, but you can't stop
the help or the guests or anything. We need one man to run it."
Finally, they did make a deal with someone, who later I found
was representing Erickson, but at the time the deal was made it was
made with someone else^ — I don't know his name — by the manager
and the general manager. I left for the coast, and when I got back
they had closed them up.
Mr. Halley. Did you know Erickson?
Mr. Schine. I knew him just in a casual way.
Mr. Halley. He stayed at your hotel sometimes, didn't he?
Mr. Schine. Well, he had a cabana there, but he didn't come there
himself. He had a cabana for friends of his who were not comiected
with his business.
ORGANIZED CRIME EST INTERSTATE COMMERCE 349
f Mr. Halley. Before we get into any other hotel, is that the only
^period during which you liad bookmaking at the Roney Phiza?
■ Mr. ScKiXE. Well, the next year we also had it, and they were closed
up, and then we didn't have it at all after that.
Mr. Halley. What did Erickson pay you for the lease at the Honey
Plaza '^
Mr. SciiiNE. I think he paid — I don't remember exactly — but it was
over $25,000.
Mr. Halley. The committee has been told it was closer to $50,000,
Mr. SciiiNE. Well, it might have been closer, but not quite 50.
Mr. Halley. ^Yas it over 40 ?
Mr. ScniNE. I think it was around 40.
Mr. Halley. Around 40?
Mr. SciiiNE. Yes, sir.
Mr. Halley. For the 3-month season at the Roney; is that right?
Mr. ScHiNE. Yes.
Mr. Halley. And that was on two successive years?
Mr. SciiiNE. One year. He wasn't in on the deal the next year.
Mr. Halley. In the second year he was not in on the deal?
" Mr. SciiiNE. No.
"" Mr. Halley. Who was in on the deal then ?
Mr. SciiiNE. I don't know his name. It was a local man.
Mr. Halley. Was it one of the S. & G. men ?
Mr. SciiiNE. Well, I wouldn't know if he was connected with them,
I presume he was.
Mr. Halley. Are there records here in Miami which would show it,
Mr. Schine?
Mr. SciiiNE. I think they should be; jes.
. Mr. Halley. Was there also bookmaking at the Boca Raton?
Mr. Schine. Well, the same would apply in the Boca Raton.
Mr. Halley. That there was bookmaking?
Mr. Schine. Yes ; for about 2 years.
Mr. Halley. Who handled tlie bookmaking at the Boca Raton
Club?
Mr. Schine. A fellow from Palm Beach, I think,
Mr. Halley. Do you remember his name ?
Mr, Schine. I think his name w^as
'~ Mr. Halley. O'Rourke?
Mr. Schine. O'Rourke, that's right.
Mr. Halley. What did O'Rourke pay for the book at the Boca
Eaton ?
Mr. Schine, I think he paid something like $10,000 1 year, and I
think he paid about $20,000 the next year,
Mr. Halley. $20,000?
Mr, Schine, I think so.
Mr, Halley, Did O'Rourke run that book alone ?
Mr. Schine. I wouldn't know. I never saw him run it, and I
wouldn't know,
Mr. Halley. Pardon me, Mr. Schine, but Mr. O'Rourke has testi-
fied that he talked directly to you about that book.
Mr, Schine, We talked it over, but I didn't make the deal with him.
' Mr, Halley, Who negotiated the deal at the Boca Raton ?
Mr, Schine, The manager negotiated it in the Boca Raton,
Mr, Halley, Did you speak to O'Rourke about it at all ?
350 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. ScHiN-E. Yes; I talked to him beforehand, in the year before
he took it. I fonnd a rather deplorable condition there. Everyone
of the caddies and bellboys were making- book and the only way
I was told was that one man would I'lni it and then they all would
stop, and that is exactly what would happen.
]\fr. Halle Y. Did you just have one man run it ?
Mr. ScHiNE. Yes.
Mr. Halley. Did j^ou not, in fact, have two men run it?
Mr. ScHiNE. What do you mean?
Mr. Halley. O'Eourke wasn't there alone, was he ?
Mr. ScHiNE. I don't know.
Mr. Halley. Didn't Erickson actually run the book at the Boca
Raton Club?
Mr. SciiiNE. No ; I don't think so.
Mr. Halley. Didn't Erickson actually have that book?
Mr. ScHiNE. No. He was the one we dealt with, O'Rourke.
Mr. Halley. Weren't Erickson's men actually running it?
Mr. Schine. I wouldn't know. I wouldn't know who was there
besides 0'K.ourke, because I never saw them run it.
Mr. Halley. Mr. Schine, O'Rourke has testified before this com-
mittee that he spoke to you about the operating of the book. As a
matter of fact, I think that he said that you sent for him.
Mr. Schine. No, I didn't.
Mr. Halley. Did he approach you ?
Mr. Schine. Yes, he approached me.
Mr. Halley. And did you oiFer to let him have the book?
Mr. Schine. I told him, after the manager sold me the idea that wo
can't keep it out, I told the manager to negotiate the deal with him.
Mr. Halley. Wlio talked price with O'Rourke ?
Mr. Schine. Well, I told the manager what we might expect, and
the manager talked price with him.
Mr. Halley. Didn't Mr. O'Rourke say that he couldn't handle that
book alone, that there was too much money involved ?
Mr. Schine. No; he didn't say that to me. I know last year we
didn't have anybody, and we had to put on 12 detectives to watch it.
Mr. Halley, Mr. O'Rourke has a somewhat different version of it.
Can you think of any reason why he should not tell the truth?
Mr. Schine. I don't know anything about it; but I'm telling the
truth.
Mr. Halley. He says that he told you he couldn't handle the book
alone, and that you said that you would find somebody to take half
of it with him, that you brought Mr. Erickson into the picture, at the
proper time.
Mr. Schine. I think that is a mistake.
Mr. Halley. Is that wrong ?
Mr. Schine. Yes, because I have very little to do with bookmaking.
I don't gamble myself, and I have very little knowledge of them.
Mr. Halijey. Would you say that Mr. O'Rourke was mistaken ?
Mr. Schine. I would say so.
Mr. Halley. It would be a very difficult matter to make a mistake
about, though.
Mr. Schine. I don't know what he said. I didn't hear what he said ;
but I am telling you the truth.
lORGANIZED CRIME IN INTERSTATE COMMERCE 351
Mr. Halley, Let me read this to you, and yon can make any com-
ment on it that you want. Mr. O'Kourke testifying :
Mr. O'RouRKE. I will tell you how that was, too: In talking to Mr. Schine,
he said — in fact, the deal was too nuich for me to handle for the pri'-e that
he asked, and I said, "I just can't go for it because I am not that kind of a man,"
and he said. "I would like to do it," and I said, "I would like to but I can't con-
sider it," and I never met Mr. Ericksoii and didn't know of him. I knew of liim l)y
reputaticui and he said, "Maybe you can work it around to where it won't be so
tough on you," so he gave me Mr. Erickson — where Mr. Erickson was, and I
don't know if he made an appointment or if I made an appointment. He was
stopping in Miami at the Roney Plaza Hotel, and I said that I would go down
and talk to him, so I went down and talked to him and he said, "John, if you
want to rake a gamble on it, I will go with you."
Mr. Schine. I disagree with him. I think he is wrong entirely.
Mr. Halley. You disagree ?
Mr. Schine. Yes.
Mr. Halley. Yo^ did not mention Erickson to O'Konrke ?
Mr. Schine. No.
Mr. Halley. And to this day you don't know that Erickson had
half of the book at the Boca Raton Club ?
Mr. Schine. No, I don't. I didn't know. I know it now.
Mr. H.vlle. Allien did you first learn of it?
Mr. Schine. I read it in the papers.
Mr. Halley. How recently did you read that in the papers ?
Mr. Schine. Well, that was in New York, during the New York
raid they had on Erickson.
Mr. Halley. About 2 months ago?
Mr. Schine. About 2 months ago, yes.
Mr. Halley. And until that time you didn't know that Erickson
had half of the book at the Boca Raton Club ?
Mr. Schine. I didn't know who had it. All I knew was that
O'Rourke was the man.
Mr. Halley. How did Erickson happen to get the book at the
Roney Plaza ? How did that take place ?
Mr. Schine. Well, you see, for 3 years we were accosted by various
people to let them make book, and we wouldn't. And because we
tried to keep it what you might call an ultraclean hotel we refused
to take on anybody, but it got so bad that the help and the guests and
the sneak bookings were bad, and finally he came to me and talked
to me about it, Erickson, and to me Erickson is no different than any
other bookmaker. They all seem to be alike. And I talked it over
with the manager, and they all agreed that it would be best to give it to
a man who was responsible rather than to one who was fly-by-night,
as you might say.
Mr. Halley. 'Wliatever the reputation of the S. & G. Syndicate
might be here in Miami, they seem to have a good reputation for
paying their bills and being responsible.
Mr. Schine. I never dealt with the S. & G. at all.
Mr. Halley. Why did you find that you could take an outsider,
like Erickson, and bypass the S. & G. ? That is really what the com-
mittee would like to know.
Mr. Schine. Well, the question was that if we were going to let the
book out, we thought we might as well do it with somebody who was
responsible and who will pay his debts and run it quietly, without
352 ORGANIZED CRIME IN INTERSTATE COMMERCE
having a lot of runners; and that is what they did, but they closed
them up very quickly.
The Chairman. Mr. Schine, where do yon live?
Mr. Schine. Gloversville, N. Y.
The Chairman. And do you know Frank Erickson in New York?
Mr. Schine. I know him only casually.
The Chairman. I mean, do you see him and talk with him ?
Mr. Schine. I saw him in the lobby and barbershop in the Waldorf,
and I see him around, but I don't know him well.
The Chairman. Did you have any business with him in connection
with this ?
Mr. Schine. No.
The Chairman. Where did you talk with Mr. Erickson about the
book at the Roney Plaza ?
Mr. Schine. He came up to my office.
The Chairman. Here in Miami Beach? <
Mr. Schine. In Miami Beach.
The Chairman. How did he pay you that $40,000, or whatever it
was?
Mr. Schine. He didn't pay it. It was done by somebody else. He
wasn't directly connected with it.
The Chairman. Who was it that paid you, sir?
Mr. Schine. I don't know. I left for the coast, and the manager
made the deal with one of his men, I assume.
The Chairman. Did you get the money yourself, or did the manager
get it ?
Mr. Schine. No; the check was given to us and deposited in the
bank.
The Chairman, By whom was it signed ?
Mr. Schine. I couldn't tell you that.
The Chairman. It was a $40,000 check, and you don't remember
who signed it ?
Mr. Schine. I wasn't here. When I came back the place was closed ;
that is, they stopped it.
The Chairman. Do you only operate these two hotels in Florida?
Mr. Schine. No, we operate four.
The Chairman. I mean, that had bookmaking.
Mr. Schine. Yes.
The Chairman. Wliere else do you have hotels?
Mr. Schine. Well, we have one in Northampton.
The Chairman. Where?
Mr. Schine. In Northampton, Mass., and in Atlantic City, and
the west coast.
The Chairman. What is the hotel in Northampton ?
Mr. Schine. The Northampton Inn.
The Chairman. Do you have any bookmaking operations there ?
Mr. Schine. No, sir.
The Chairman. How about in Atlantic City?
Mr. Schine. No, sir.
The Chairman. What is your hotel there?
Mr. Schine. The Ritz-Carlton.
The Chairman. And on the west coast?
Mr. Schine. The Ambassador. "
O'RGAjstized orime m interstate commerce 353
The Chairman. At Los Angeles ?
Mr. ScHiNE. Yes.
The Chairman. Do you have bookmaking there ?
Mr. ScHiNE. No, sir.
The Chairman. Wliat other hotels do you own?
Mr. ScHiNE. I think that is all.
The Chairman. They are all owned by the Schine Theater Co. ?
Mr. Schine. By the Schine family and the theater company. They
are not all owned by the Schine Theaters, but by the Schine family.
The Chairman. Did the hotel business improve during the years
you had bookmaking; was there more business, more customers?
Mr. Schine. It was less business when we didn't have it.
The Chairman. There was more business when you did have it?
Mr. Schine. Last year in Boca Raton our business dropped con-
siderably, because we didn't have it.
The Chairman. Therefore, having bookmakers makes good busi-
ness for your hotels ?
Mr. Schine. No. It doesn't make good business. Personally, I
don't like it. I really resent it, but the guests seem to like it, and in
Boca Raton they have nothing to do but either play golf or play the
horses, and if they can't do that they go somewhere else, and that is
what happened last year in Boca Raton.
The Chairman. How do you figure the sum of $40,000 ; how do you
estimate that as being the value ?
Mr. Schine. Well, we just asked him 50. Then he offered 25, and
it was gotten together that way.
The Chairman. And then you figured $20,000 up at Boca Raton ?
Mr. Schine. Well, we couldn't get any more.
The Chairman. What did you figure it on, the size of the operation ?
Mr. Schine. No. It was a question of how many customers they
could get, presumably.
The Chairman. How does that $40,000 compare with your annual
net profit for the operation of the hotel ?
Mr. Schine. Well, it isn't much at all, comparatively.
The Chairman. Did that go right into the hotel receipts?
Mr. Schine. Yes.
The Chairman. All right, Mr. Schine, that is all for now. Thank
you, sir.
TESTIMONY OF C. V. GRIFFIN, HOWEY-IN-THE HILLS, FLA.
The Chairman. Mr. Griffin, do you solemnly swear that the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God ?
Mr. Griffin. Yes.
Mr. Halley. What is your business, Mr. Griffin ?
Mr. Griffin. Fruit business — citrus.
Mr. Halley. Where is your business located ?
Mr. Griffin. Howey-in-the-Hills.
Mr. Halley. In Florida ?
Mr. Griffin. Yes.
Mr. Halley. Mr. Griffin, you know Gov. Fuller Warren, of course ?
Mr. Griffin. Yes.
354 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley, Did you have anything to do with his campaign for
Governor ?
Mr. Griffin. I helped him finance his campaign.
Mr. Halley. Did you handle his campaign as campaign manager?
Mr. Grlffin. Well, yes ; to a large extent.
Mr. Halley. You are largely responsible for its policy?
Mr. Griffin. For what ?
Mr. Halley. The policy for rmming the campaign.
Mr, Griffin. I had a lot to do with it.
Mr. Halley. Did you personally make a large contribution to that
campaign ?
Mr. Griffin. Yes, sir.
Mr. Halley. How much did you contribute ?
Mr. Griffin. Approximately $154,000, 1 think. I don't have those
figures exactly, but I did at one time release them to the press and they
were correct.
Mr. Halley. Did you ask any other people to contribute a similar
amount ?
Mr. Griffin. Yes, sir.
Mr. Halley. Would you state to the committee exactly what hap-
pened in that connection ?
. Mr. Griffin. I asked Mr. Wolfson and also Mr. Johnston.
Mr. Halley. Who is Mr. Wolfson; is that Mr. Lou Wolfson?
Mr. Griffin. Yes.
Mr. Halley. Mr. Wolfson, who just testified ?
Mr. Griffin. Yes.
Mr. Halley. And who is Mr. Johnston?
Mr. Griffin. Well, he is from Jacksonville.
Mr. Halley. That is W. H. Johnston ?
Mr. Griffin. W. H. Johnston.
Mr. Halley. What did you ask each of them ? What was your con-
versation ?
Mr. Griffin. Well, in the beginning — I didn't get in the campaign
until late, and the Governor asked me to take charge of his campaign,
and I ask Mr. Johnston and Mr. Wolfson to meet with me at a hotel in
Jacksonville, and we each contributed, to begin with, $25,000.
Mr. Halley. How long had you know Mr. Wolfson before then?
Mr. Griffin. Oh, I don't remember ; some time.
Mr. Halley. Some years?
Mr. Griffin. No; not some years. I had known of him for some
years, but not personally.
Mr. Halley. Would it be a matter of months ?
Mr. Griffin. Yes.
Mr. Halley. Did you know him as long as 6 months at that point?
Mr. Griffin. I think I knew him that long or longer ; knew of him.
I wasn't closely acquainted with him.
Mr. Halley. Had you and Wolfson become fairly good friends by
that time?
Mr. Griffin. Yes,
Mr. Halley. Had you visited each other's home?
Mr, Griffin. No, sir.
Mr. Halley. Did you have business transactions together ?
Mr. Griffin, No; no more than I bought some supplies from his
place of business in Orlando.
ORGAXIZED CRIME EST INTERSTATE COMMERCE 355
Mr. H ALLEY. What made you pick out Wolf son as the man to go to
and ask for a lar^e sum of money ?
Mr. Griffin. Well, I just thought he had lots of money.
Mr. Halley. Did anybody suggest his name to you?
Mr. Griffin. I don't remember that anyone did.
Mr. Halley. Did he come to you, by any chance?
Mr. Griffin. No.
Mr. Halley. You went to him?
]\Ir. Griffin. Yes.
Mv. Halley. And you asked him to share in the campaign expenses?
Mr. Griffin. Yes.
Mr. Halley, How did you put it to him?
Mr. Griffin. I couldn't answer that question. I just don't remem-
ber now, except I told him that I thought that he and I and Johriston,
the three of us, could finance the campaign, and he was willing to go
along. He knew the Governor, and I had known him for a long time.
So we decided to handle the financing.
Mv. Halley. You decided to go share and share alike?
Mr. Griffin. Yes.
Mr. Halley. How long had you known Johnston ?
Mr. Griffin. Well, I hadn't known him much longer than I had
Wolfson, except back in 1940 through some attorney I had known him,
and I had helped the Governor at that time finance his campaign, and
he had made a contribution, a small contribution then. I never actually
met liim at that time.
Mr. Halley. And you agreed to divide the thing share and share
alike?
Mr. Griffin. Yes.
Mr. Halley. Did you have a joint meeting of the three of you?
Mr. Griffin. Yes.
Mr. Halley. At the outset, you each put $25,000 into a fund?
Mr. Griffin. That's right.
Mr. Halley. Was anybody appointed to handle the fund ?
Mr. Griffin. Julian Fant.
Mr. Halley. Is he a banker ?
Mr. Griffin. Yes. He was already handling funds, but there wasn't
any funds up until that time.
Mr. Halley, Didn't Governor Warren turn some funds over to you
at the beginning ?
INIr. Griffin. A small amount ; very small.
Mi\ Halley. How much was it ?
Mr. Griffin. Well, if I recollect correctly, it was something like,
between four and five thousand dollars. It was just three.
]\Ir. Halley, Was it in cash or check?
Mr. Griffin. No ; it was in a bank account,
jNIr. Halley, You took that bank account over?
Mr. Griffin, Yes.
Mr. Halley. What was your interest in contributing that large
sum of money ?
Mr. Griffin. Well, to begin with, I didn't think that it would run
into any such figures as it finally ran into, and of course, being inter-
ested in citrus and being a big property owner in Florida, I had an
interest there, from the citrus standpoint more than anything else, of
356 ORGANIZED CRIME IN INTERSTATE COMMERCE
getting some legislation that would give us a better quality citrus
industry. -
Mr. Halley. Did you want a citrus commission established?
Mr. Griffin. It was already established.
Mr. Halley. What did you want done wdth the commission ?
Mr. Griffin. I didn't particularly want anything done with the
commission.
Mr. Halley. You didn't want a different type of regulation of
citrus standards?
Mr. Griffin. Yes, sir ; I had believed for a long time that it would
be profitable to the citrus industry to ship more ripe fruit than we
hacl been shipping, and I was going to promote legislation in an at-
tempt to accomplish that end — which we did — and put through the
legislature the citrus code.
Mr. Halley. After Governor Warren was elected, is that right ?
Mr. Griffin. Tliat's right. He agreed not to veto it, and to sup-
port it.
Mr. Halley. At the start you thought that Johnston was just in
the dog track business, is that right ?
Mr. Griffin. That's right.
Mr. Halley. In Miami and Jacksonville ?
Mr. Griffin. At that time I didn't even know he was in Miami.
The only thing I knew about it was that he had a dog track in
Jacksonville.
Mr. Halley. As the campaign progressed did you learn that John-
ston hacl other connections ?
Mr. Griffin. I heard that ; yes.
Mr. Halley. What did you hear ?
Mr. Griffin. I don't remember.
Mr. Halley. Do you remember talking about it to an investigator
for this committee ?
Mr. Griffin. Slightly, yes.
Mr. Halley. AVell, do you remember telling him that you had
learned that Johnston was a front for Chicago racketeers ?
Mr. Griffin. No, sir.
Mr. Halley. If his memorandum shows that, is it possible that
that could be true ?
Mr. Griffin. I never made any statement like that. It was dis-
cussed and the investigator mentioned that, and I told him he had
his ideas and probably knew more about it than I did.
Mr. Halley. Did you. ever find out that Johnston was a front for
Chicago racketeers?
Mr. Griffin. No. I never definitely found out.
Mr. Halley. Did you ever learn that Johnston was head of the
Sportsman's Park Racetrack?
Mr. Griffin, I have heard that ; yes.
Mr. Halley. When did you hear that ?
Mr. Griffin. Oh, I don't remember just when.-
Mr. Halley. You have heard that that was a racketeer-controlled
racetrack, haven't you?
Mr. Griffin. I have heard it. In fact, it has been in the jjapers allj
over the country. If you read the papers you couldn't help but see it.
Mr. Halley. And didn't you learn of that during the progress i
of the campaign ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 357
Mr. Griffin. Not during the progress of the campaign. I was
too busy. It was probably a few months after the campaign.
Mr. Halley. Shortly after the campaign?
]\Ir. Griffin. Yes.
Mr. Halley. Then yon began to learn about Johnston, is that right ?
Mv. Griffin. That's right.
Mr. Halley. And was it at that time that you learned that he was
a front for Chicago racketeers?
Mr. Griffin. I never learned that he was a front for Chicago
racketeers.
Mr. Halley. You did tell that to our investigator, didn't you?
Mr. Griffin. No; I didn't tell that to your investigator.
Mr. Halley. Didn't yon tell Mr. Rice, who is sitting right here,
that you believed that Johnston was sent to Florida by Chicago
racketeers ?
Mr. Griffin. I agreed with him. He suggested it, and, as I said, it
has been in all the papers, and the Crime Commission of Miami said
so, and I believe that some of their findings are probably correct, but
I hadn't gone to the bother of investigating to find out.
Mr. Halley. Mr. Rice approached you as saying that you thought
Johnston "didn't own his own soul''; is that right?
Mr. Griffin. Those statements don't agree with my memory.
. Mr. Halley. How did you contribute the money that you provided
for the campaign, in cash or in check?
Mr. Griffin. By checks.
Mr. Halley. All of it?
Mr. Griffin. Yes ; checks, and eventually I had run out of money,
and Mr. Johnston took my note for $35,000, and Mr. Wolf son took
my note for $35,000 for my part of the campaign, which I later paid
off, after it was over.
Mr. Halley. Johnston contributed all of his money in cash, didn't
he?
Mr. Griffin. I don't remember how he contributed his money.
Mr. Halley. You told that to Mr. Rice, didn't you ?
Mr. Griffin. No, sir.
Mr. Halley. Do you have your original memorandum, Mr. Rice?
•• Mr. Rice. Yes.
• Mr. Halley. Mr. Griffin, do you recall, on May 31, 1950, meeting
Mr. Rice at 3'our home at Howey in the Hills? You do recall that, do
you not?
Mr. Griffin. That's right.
Mr. Halley. Do you recall talking to him?
Mr. Griffin. Yes, sir.
Mr. Halley. And do you recall that shortly before that you had
given some information to the Florida newspapers?
Mr. Griffin. Yes, sir.
Mr. Halley. AVhat had you told the Florida newspapers? You
made a statement to the papers, didn't you?
Mr. Griffin. I made a statement. I don't want to add or subtract
anything that I said. If I at any time said anything about Mr.
Johnston, I don't remember.
Mr. Halley. Can you remember what you told the press now ?
Mr. Griffin. I can't remember what I told the press 6 months ago.
Mr. Halley, In substance what did you say ?
358 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Griffin. In substance I was asking the Governor to enforce the
gambling hiws and keep his oath of office, and I still feel the same way.
Mr. H ALLEY. Did you believe that he was not enforcing the gam-
bling laws at that time ?
Mr. Griffin. I didn't see where they were being enforced, and I
asked him many, many times to enforce them.
Mr. Halley. In fact, right after he was elected you caused yourself
to be named special investigator, did you not?
Mr. Griffin. No. It was several months after he was elected.
Mr. Halley. How long after ?
Mr. Griffin. I don't recall just exactly now,
Mr. Halley. Was it early in 1949 ?
Mr. Griffin. I would say, offhand, it was in the middle of 1949. I
would have to look it up to verify that date. He did appoint me as
chief investigator.
Mr. Halley. How long did you serve as chief investigator?
Mr. Griffin. Until he fired me.
Mr. Halley. Until when?
Mr. Griffin. Until I was fired.
Mr. Halley. Who fired you ?
Mr. Griffin. The Governor.
Mr. Halley, How did that happen?
Mr, Griffin, Apparently he didn't agree with my way of thinking.
Mr, Halley, What was your way of thinking; did you have any
discussions with Governor Warren?
Mr. Griffin. Several; yes.
Mr. Haley. Would you state what they were ?
Mr. Griffin. Well, I mostly referred to the findings of the Crime
Commission here in Miami, and that the situation didn't look right,
and I asked him to do something about it.
Mr. Halley. You had been appointed chief investigator ? Did you
try to do anything about it?
Mr. Griffin. I told him I was going to.
Mr. Halley, Were you permitted to investigate as you saw fit ?
Mr. Griffin. I was permitted, but nothing that I recall was ever
accomplished ; nothing ever done,
Mr. Halley, Did you come down to Miami and begin to investigate?
Mr. Griffin. I didn't have to come to Miami. Lots of people
would come to me, and they told me about different conditions, and
that is how I found out what I found out.
Mr. Halley. What did people tell you ?
Mr. Griffin. Well, about gambling conditions and just about
various things.
Mr. Halley. Did they tell you that the law was not being enforced
in Miami?
Mr. Griffin, Yes.
Mr. Halley. Did they make charges about the law-enforcement
authorities?
Mr. Griffin. They made charges about authorities in Miami and
various other places.
Mr. Halley. Did you tell all of that to the Governor?
Mr. (iRiFFiN. I had several discussions with him about it.
Mr. Halley. And then you resigned?
Mr, Griffin. I didn't resign. He fired me.
ORGANIZED ORIAIE IX INTERSTATE COMMERCE 359
Mr. Halley. For what reason did he fire you?
Mr. Gkiffin. I imaoine he had a oood reason to fire me. 1 donx
know what his reason was. He never gave me any reason. He an-
nounced my appointment, and the next day I was fired ; so, that is all 1
can say about that.
Mr. Halley. You mean you served for only 1 day?
Mr. Griffin. No. I had been chief investigator for several months,
but I hadn't exercised any of my authority, and I don't think that
anybody knew that he had appointed me chief investigator, because I
had a citrus business to look after and I didn't particularly want to
be identified as an investigator unless it became necessary.
Mr. Halley. As an investigator what did you investigate?
Mr, (tkiffix. What did I investigate?
Mr. Halley. What did you do about investigating?
Mr. Griffin. I was getting ready to do something, but I didn't get
the opportunity.
Mr. Halley. What did you need in order to have the opportunity ?
Did you ask for any authority?
Mr. Griffin. He had given me the authority.
INIr. Halley. Did you need funds?
Mr. Griffin. Well, I volunteered to do it without funds. I felt
like I had made quite a contribution to thd campaign, and I just
believed in better government than it looked like we were getting, so,
after discussing these things with him several times, I told him to
announce my appointment as chief investigator ; so, the announcement
came out. It apparently was all right until a day or two later; then
he fired me.
Mr. Halley. Do you think that somebody objected to your being
named chief investigator?
Mr. Griffin, I imagine somebody did,
Mr. Halley. Have you any idea about who it might have been ?
Mr. Griffin. I have my ideas.
Mr. Halley. Bill Johnston?
Mr, Griffin. Well. I wouldn't want to say it was Bill Johnston,
It might have been Bill Johnston,
Mr. Halley. Didn't you tell that to Downey Rice ?
Mr. Griffin. I made a statement that Bill Johnston was in Talla-
hassee the day that I got fired. That is as much as I told Mr. Rice,
Mr. Halley. Do you think that Bill Johnston went to Tallahassee
to see the Governor?
Mr. Griffin, It's possible that he did.
Mr. Halley. And the next thing that happened was that you got
fired?
Mr. Griffin. That's right. I got fired.
Mr. Halley. Can you state any reason why Bill Johnston would not
have wanted you to investigate gambling in Florida?
Mr. Griffin. Well, I suppose that there are plenty of reasons. I
don't suppose I can state any of them. I probably wanted some of
the law-enforcement officers to enforce the law; that would have been
3iiy intention.
^Ir. Halley. Did you ever talk about it with Johnston ?
Mr. (triffin. No ; I can't say that I ever did.
Mr. Halley. Did you know this investigator that they call "Bing"
Crosby ?
68958 — 50 — pt. 1 24
360 ORGANIZED CRIME EST INTERSTATE COMMERCE
Mr. Griffin. Yes, sir.
Mr. Halley. Did he work for you ?
Mr. Griffin. No.
Mr. Hallet. Or under your direction ?
Mr. Griffin. No, sir.
Mr. Halley. Did you know that he had come to Miami to make an
investigation ?
Mr. Griffin. I had been told that; yes.
Mr. Halley. Who told you that ?
Mr. Griffin. Oh, various ]:)eople. I don't remember who.
Mr. Halley. Did you know whether he had made one?
Mr. Griffin. Whether Crosby had made an investigation? I had
heard that he had been down there.
Mr. Halley. Did he come back to Tallahassee or to Jacksonville
with any findings?
Mr. Griffin. I don't know,
Mr. Halley. Did you ever discuss Crosby's investigations with
Johnston ?
Mr. Griffin. No.
Mr. Halley. Or with Kush ? Do you know Mr. Eush ?
Mr. Griffin. Yes ; I do know Mr. Rush.
Mr. Halley. Did you ever discuss Crosby's investigations with
Rush?
Mr. Griffin. No.
Mr. Halley. Crosby was fired too, was he not, or at least called off
the investigation ?
Mr. Griffin. That I don't remember.
Mr. Halley. You don't remember?
Mr. Griffin. It seems to me like he was called in to Tallahassee,
but I don't recall.
Mr. Halley. Well, he came to Miami and started investigating; is
that right ?
Mr. Griffin. He had been investigating.
Mr. Halley. And then he was called to Tallahassee? Is that
right?
Mr. Griffin. I believe he was.
Mr. Halley. Did he do any more investigating in the Miami area
after that?
Mr. Griffin. Well, it's my opinion that he is still investigating. I
suppose he is still investigating.
Mr. Halley. Is he actively investigating?
Mr. Grifftn. I couldn't answer that. I don't know.
Mr. Halley. You were investigator for some months, but you didn't
do anything ; is that right ?
Mr. Griffin. I didn't do anything; no. Nobody at that time knew
that I was an investigator.
Mr. Halley. Now, you have mentioned $154,000 that was put into
the campaign. Did you put your own money in ?
Mr. Griffin. I put my money and my partner's, who is in business
with me; the two of us contributed.
Mr. Halley. Did you get any money from auy other person?
Mr. Griffin. No.
Mr-. Halley. Do 3^ou know whether Johnston got money from any
other person?
ORGANIZED CRIME IK INTERSTATE COMMERCE 361
Mr. Griffin. I don't know where Johnston's money came from.
Mr. Halley. It was all cash ?
Mr. Griffin. I can't say it was all cash.
Mr. Halley. Did he have any books, do yon know ?
Mr. Griffin. If he did, I didn't see them.
Mr. Halley. As a matter of fact, didn't you tell Mr. Downey Rice
that Mr. Johnston kept his book in his hip pocket?
Mr. Griffin. I never saw any books, if he had any.
Mr. Halley. You also mentioned that you didn't know that he had
any office, that he just had a home in Jacksonville?
Mr. Griffin. I don't know yet whether he has an office or not.
The only time I ever saw Johnston was when we needed to put up
some money, and we would agree on the amounts, and the money was
given to the treasurer, and he handled the disbursing of most of the
funds until the end of the campaign, which ran out of money, and
Mr. Wolf son and Mr. Johnston just paid the bills. I think it was a
large sum of money and that it didn't go through the campaign head-
quarters. I gave him my notes for my one-third.
Mr. Halley. Where did Johnston bank, do you know ?
Mr. Griffin. I don't know.
Mr. Halley. Was it the Continental Bank in Chicago?
Mr. Griffin. I don't know.
Mr. Halley. You don't know ?
Mr. Griffin. I think it was Jacksonville.
Mr. Halley. In Jacksonville ?
Mr. Griffin. My bank is the Continental Bank in Chicago.
Mr. Halley. Your bank ?
]\Ir. Griffin. He might have banked there. I don't know wdiere he
banked.
Mr. Halley. Did you ever get any checks from him on the Conti-
nental Bank?
Mr. Griffin. One time he gave me a cheek, and I didn't get the
amount and I don't remember the bank, but I feel certain that the
man that handled the financing can still give you that.
Mr. Halley. But didn't you tell Mr. Downey Rice that he banked
in the Continental Bank in Chicago?
Mr. Griffin. No, sir.
Mr. Halley. Does Mr. Rice remember you as having said that he
was mistaken?
Mr. Griffin. I don't even remember the Continental Bank. It
might be that I got a check on the Continental Bank at one time. He
gave me a check one time.
Mr. Halley. But you told Mr. Rice, did you not, that Johnston
told you that his bank was the Continental Bank iii Chicago ?
Mr. Griffin. Well, I think I have heard him mention that he did
business with the Continental Bank. I think it was also the Atlantic
Bank in. Jacksonville, but I wouldn't want to make that as a statement.
Mr. Halley. Didn't you also tell Mr. Rice, as the situation pro-
gressed, that tlie thing became apparent to you that Johnston's motive
for contributing to the campaign was to insure protection of gambling
enterprises in Florida ?
Mr. Griffin. I don't remember making any statement substantially
like that. The discussion did come up about the functioning of — it had
362 ORGANIZED CRIME IN INTERSTATE COMMERCE
been in tlie papers. Mr. Rice knew what Mr. Johnston's business was
and I never said "Yes'' or "No."
]\Ir. Halley. Did Mr. Rice put all these things in the memorandum
that he wrote ? Would he be mistaken i
Mr. Griffin. It could be he didn't make any memorandum when
he was there with me.
Mr. Halley. Well, if he wrote one shortly after he left you and
put all these things down, would he be mistaken ?
Mr. Griffin. I wouldn't say he would be mistaken about any of
them but I am certain that what
Mr. Halley. Did Mr. Rice take some notes right in your presence?
]Mr, Griffin. No. When I saw him he was there about 3 hours.
Mr. Halley. Didn't he make the notes while you talked?
Mr. Griffin. I don't remember him making any notes.
Mr. Halley. What was your motive for making the contributions?
Mr. Griffin. My motive? I liked Fuller Warren. I know him
since college. I am in the citrus business and own and operate and
control several thousand acres of citrus. I wanted to see better govern-
ment and I thought I was going to get it.
Mr. Halley. You also wanted to get your partner on the citrus
commission, didn't you?
Mr. Griffin. Naturally I would like to get him in. Naturally I
would want my associate as chairman, which he was.
Mr. Halley. He was your business partner ?
Mr. Griffin. Yes.
Mr. Halley. And he went on the commission as chairman; is that
right ?
Mr. Griffin. I worked on the commission as chairman.
Mr. Halley. And you got appointed through the committee as a
special investigator?
Mr. Griffin. I got my appointment as chief investigator before I
got on. I don't remember the dates, but it was sometime along about
the same time.
Mr. Haixey. Between the time you were appointed and the time
you were fired, did you make any trips at all to Miami or Miami Beach ?
Mr. Griffin. Not as an investigator.
Mr. Halley. I didn't ask you that. Did you make any trips as
investigator ?
Mr. Griffin. Yes ; I was in Miami.
Mr. Halley. How often ?
Mr. Griffin. I think twice.
Mr. Halley. Where did you stay when you came to Miami?
Mr. Griffin. At the McAllister.
Mr. Halley. McAllister Hotel ?
* Mr. Griffin. Yes.
Mr. Halley. And did you have any discussions with any people in
Miami ?
Mr. Griffin. Some people discussed some things with me while I
was down here.
Ml'. Halley. Did you discuss the gambling situation with anybody?
Mr. Griffin. Not any more than I had to. A lot of people wanted
to discuss it and I couldn't help but discuss it.
Mr. Halley. With whom did you discuss it, the gambling situation?
ORGANIZED CRIME IN INTERSTATE COMMERCE 363
Mr. Griffin. I don't just remember. There were so many of them
that discussed it or tried to that I just can't recall. _ ■
Mr. Halley. Do you recall calling on the commissioners?
Mr. Griffin. No.
Mr. Halley. Did you call on the sheriff ?
Mr. Griffin. No.
Mr. Halley. Or the chief of police?
Mr. Griffin. No.
Mr. Halley. You made no attempt to investigate at all ?
JNIr. Griffin. I didn't make any attempt. I heard lots about it from
lots of people, but I wasn't investigating.
Mr. Halley. Did you talk to Jolmston about it ?
jNIr. Griffin. You couldn't get on the street without hearing about
it, or getting in a taxicab.
]Mr. Halley. Well, you were getting a lot of street talk, but did you
try to get facts?
Mr. Griffin. I got what seemed to me to be substantially the truth
of what was happening.
Mr. Halley. In those months who did you go to in your official
capacity to attempt to accomplish something?
Mr. iGrRiFFiN. I don't recall going to anybody. I was fixing to.
When I asked the Governor to appoint me as chief investigator I had
been here in these rooms, and I told Fuller that it was looking like
it is getting to the point where somebody was going to have to stop
it, and he seemed to be very pleased about my being the one to do it.
Mr. Halley. Had you told Johnston that you were going to ask
Fuller Warren to make your appointment? Did you make that
public?
Mr. Griffin. No.
Mr. Halley. Until one day later when Johnston did get to Talla-
hassee ; is that right ?
Mr. Griffin. I think he got there the day after he read it in the
neATspapers.
Mr. Halley. Then you are pretty sure he got there; is that right?
Mr. Griffin. Yes.
Mr. Halley. Are you pretty sure that Johnston got to see the
Governor ?
Mr. Griffin. I can't say that I actually saw Johnston on the day
after my appointment was announced. I did talk to him on the street,
though.
Mr. Halley. Where did you see him on the street ?
]\Ir. Griffin. About a block from the capitol, across the street.
Mr. Halley. Was he heading in the direction of the capitol ?
Mr. Griffin. He was heading away from it.
Mr. Halley. Was he coming from the direction of the capitol ?
Mr. Griffin. He was leaving.
Mr. Halley. He was leaving the capitol?
Mr. Griffin. I didn't say. He could have been anywhere. He
wasn't a block away from the capitol.
Mr. Halley. Did you hear whether or not he saw the Governor that
day ?
Mr. Griffin. I didn't hear, but the next day, the next morning or
that night, I read in the papers the fact that the Associated Press
called up and told me I had been fired. I didn't even know about it.
364 ORGAlSriZED CRIME IN INTERSTATE COMMERCE
■ Mr. Hallet. Then you issued a statement blasting Governor
Warren ?
Mr. Griffin. I started issuing statements.
Mr. Halley. And did you also speak to Johnston after that?
Mr. Griffin. I don't recall ever seeing Johnston since that time. It
was a good while before that time.
Mr. Hali^y. Did you speak to him about the investigation?
Mr. Griffin. No; I never mentioned it.
Mr. Halley. At any time?
Mr. Griffin. No.
Mr. Halley. What did you think Wolfson wanted out of the gover-
norship? Why was he contributing?
Mr. Griffin. Well, I never have been able to figure out what he
wanted out of it. He liked Fuller and told me that he wanted to see
him make a good Governor. He never asked me for any commitments
in any way. In fact, neither one of them. Wolfson or Johnston never
did. If they got any, they got them from the Governor after the
campaign.
Mr. Halley. I have no other questions.
The Chairman. Mr. Griffin, did you, or to your knowledge did
Johnston and Wolfson have anything to do with the bill that changed
the law^s for political gains?
Mr. Griffin; Not to my knowledge.
The Chairman. Do you know it was illegal, that there was a legal
limit at the time of election, and that was repealed shortly afterward?
Mr. Griffin. I can't see — I know there was a legal limit, but I can'r
see that in any way where individuals couldn't spend as much money
as they wished. We never made any contributions to the Fuller War-
ren campaign except $500 a week to travel on. We got that much.
The Chairman. Do you mean all the rest was spent for advertising
and expenses?
Mr. Griffin. Yes, sir. I will have to say that.
The Chairman. Don't you think it is better to have a lot of people
putting in some money rather than two or three people ?
Mr. Griffin. Well, we had a whole lot of them. I think in the
course of the campaign we had many contributions. After I got into
it, it was late in the campaign. We didn't turn down any money, but
all told, it didn't amount to more than $12,000 or $15,000.
The Chairman. Don't you think that a person contributing such
a large amount might feel an obligation to that person?
Mr. Griffin. Well, I think he could feel under obligation. I have
told the Governor that as far as my contribution was concerned, he
could forget it.
The Chairman. But he hadn't been in long before you asked him to
be chief investigator?
Mr. Griffin. Quite some time.
The Chairman. How much does that pay?
Mr. Griffin. It paid nothing. I wouldn't accept anything for it.
The Chairman. Do you mean you just had an honorary position?
Mr. Griffin. I never got any compensation out of anything.
The Chairman. Did you pay off Mr. Johnston and Mr. Wolfson?
Mr. Griffin. I paid them both.
The Chairman. That has all been settled up?
Mr. Griffin. Yes.
ORGANIZED OREVTE EST rNTERSTATE COMMERCE 365
The Chairman. Did you all know that it was a violation of a State
law to make a campaign contribution at that time?
Mr. Griffin. I didn't contribute an}^ money to the campaign. I
just paid advertising expenses. I could advertise Pet Milk if I wanted
to, if I wanted to spend my money that way.
The Chairman. So of course it didn't come from the Governor
directly. You weren't helping him directly?
Mr. Griffin. I was helping him get elected, and I considered him
my friend and I felt that 1 could spend my money the way I saw tit.
The Chairman. Did you ever consider contributing, or did you ever
contribute any funds before?
Mr. Griffin. No, I didn't. I didn't think I was going to to this one
either when I started.
Mr. Halley. Did you ever tell anybody that Johnston was a front
for the Chicago mob?
Mr. Griffin. Not to my memory.
Mr. Halley. Do you i-ecall being called on the telephone just after
your public announcement ?
Mr. Griffin. By whom ? Who was that ?
Mr. Halley. Do you recall being called on the telephone by any
newspapers just after your public announcement? Do you remember
being called by a newspaper correspondent by the name of Mr. Link?
Mr. Griffin. I was called by so many I wouldn't recall. They were
calling me day and night.
Mr. Halley. Didn't you tell him in so many words that Johnston
was a front for the Chicago mob?
Mr. Griffin. No, sir.
Mr. Halley. No more than you told Downey Rice that ?
Mr. Griffin. I told him if he called me he could have any one of
my press releases assuming he would pay for them. I told* him he
could have them as soon as anyone else. I told them all that. I didn't
talk to any of these others.
Mr. Halley. In fact, you said Johnston had an account at the
Continental ?
Mr. Griffin. I don't know that he has an account at the Conti-
nental now. I think he has mentioned that the Continental Bank
is the one he did business with in Chicago.
Mr. Halley. And didn't you tell that to these newspaper corre-
spondents ?
Mr. Griffin. No, sir.
Mr. Halley. Didn't you ?
Mr. Griffin. I had no occasion to even discuss it with anybody.
Mr. Halley. Didn't you even also tell him Johnston had contributed
at least $50,000?
; Mr. Griffin. Fifty thousand ?
r Mr. Halley. Yes.
Mr. Griffin. If I would have told him anything, I would have told
him he would have contributed the same amount I did.
Mr. Halley. At that point you weren't telling anyone how much
anybody had contributed?
Mr. Griffin. Not telling them until one newspaper would get one
story and another newspaper would get another one, and finally they
began adding them up. So one day I asked my accountants to give
me a figure of wdiat my books showed, and gave it to them.
366 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Would you say that both Mr. Link and Mr. Rice were
in error or mistaken when they both say that you told them that, when
you told them that Johnston was a front for the Chicago mob ?
Mr. Griffix. I don't remember talking to Ted Link. I don't know
who he is.
Mr. Halley. Didn't he call you on the phone?
Mr. Griffin. I don't ever remember him calling me. Who does
he work for, or who is he ?
Mr. Halley. He works for the Post-Dispatch at St. Louis.
Mr, Griffin. The Post-Dispatch called me in St. Louis, and I told
them I had no comments, if that is where lie works.
Mr. Halley. You didn't comment at all. Do you think that he
is just making the whole thing up ?
Mr. Griffin. I told him if he wanted to pay for my releases I
would wire them to him.
Mr. Halley. Do you think that he just is making up the story ?
Mr. Griffin. If he has made that statement. He said, "If I come
down there won't you give me a release," and I said, "You can have
them just like anybody else, and when I get ready to say something,
you can release it to all the press."
The Chairman. All right, thank you, ]\Ir. Griffin,
Will Mr. Julian E. Fant come forward, please ?
Mr. Fant, do you solemnly swear that the testimony you will give
this committee will be the truth, the whole truth, and nothing but the
truth, so help you, God ?
Mr. Fant. i do.
TESTIMONY OF JULIAN E, FANT, TREASURER, WARREN
CAMPAIGN FOR GOVERNOR
The Chairman. All right, let's get along with the hearing.
Mr. Halley. Have you brought your records here ?
Mr. Fant. They are in the possession of the committee somewhere,
Mr. Halley. You turned them over to us sometime ago ?
INIr. Fant. Yes. These are the books and records.
Mr. Halley. Will you identify the books and records, please ?
Mr. Fant. Yes, sir. These are the general books. These are the
past books and memorandums, and these various tiles in here are travel
expenses and Western Union; petty cash and payrolls and so forth.
These are miscellaneous items, chiefly related to multigraphing, and
here is a file on savings accounts. The remainder of this, gentlemen,
is canceled checks and checkbooks, all of which are supporting these
general books here.
I would like to state, first, that, at the time I was appointed treasurer,
I went to the agent in charge of the collector of internal revenue's
office in Jacksonville, Mr. Harry Howard, and advised him that I
had been made treasurer.
Mr. Halley. Do you mean treasurer for the Warren campaign for
Governor ?
Mr. Fant. Yes. I told him that I would like to keep the books in a
satisfactory fashion and that I would keep possession of them and
that they would be available to him at any time.
Mr. Halley. Who asked you to serve as treasurer ?
ORGANIZED ORIME IN INTERSTATE CO'MMERCE 367
Mr. Fant. There was not any individual, Mr. Plalley, that asked
me to serve as treasurer. I sort of got that job wished off on me by a
group of people up here. But to name the group exactly, sir, I
wouldn't be able to do it. I could name some of them. J. Turner
Butler was one ; John Mathews was one ; INIr. Whatley was one ; Robert
Smith of the A & P store was one. There were probably all told,
I should assume, anywhere from 7 to 12 to 15 people.
Mr. Halley. Did you talk directly to Griffin about it?
Mr, Fant. I don't tliink so, sir.
]Mr. Halley. Didn't he instruct you to start the campaign — the
fund-raising campaign ?
Mr. Fant. No, sir; he didn't. I didn't raise any funds, Mr, Halley.
Mr. Halley. You just disbursed them; is that right?
Mr. Fant. That is right. I received the funds and disbursed them.
The mechanics of the thing is this : Mr, Frank Wright was campaign
manager, and when Mr, Wright would send down a bill with his
O, K, on it, then we would issue a check predicated on that,
Mr. Halley. Now how much money passed through your hands?
Mr. Fant. Let's see. Through my hands passed $262,389.96. There
was $22,550 that was spent through Mr. Wolfson for advertising in
the second primary of the campaign. The thing became so hectic that
I just declined to fool with the advertising money. It was coming in
one day and running out the next. It looked'just like I would have to
quit in order to do it — just like I would have to quit business. So I
just told him to take this off my hands. They were busy making
decisions right and left up there and making connnitments, and I just
didn't feel I was competent to do it.
Mr. Halley. In addition to the money that passed through your
hands, there were other large sums of money that you did not handle,
were there not?
Mr. Fant. Well, I can't say that there were other large sums of
money that I didn't handle, but there must have been other sums of
money that I did not handle if they spent $153,000 apiece on it.
INIr, Halley. You heard their given testimony on it?
Mr. Fant. Yes, sir. While I am confident that it must not have —
that is all I got and all I spent.
Mr. Halley. From whom did you get it ?
Mr. Fant. Well, now, let's take a look. I guess probably about
90 percent of that money came from Mr. Wolfson, Mr. Johnston, and
Mr. Griffin. There were three accounts opened. The Taxpayers'
League Trustee account was opened on February 9, 1949, with a deposit
of $49,100, which consisted of $25,100 in cash and a check drawn by
the Bank of Taveres on the Barnett National for $24,000. There were
subsequent deposits in that account, on the 24th of February a check
from Mr. Wolfson for $25,000. On April 10 a check from Mr. Wolf-
son for $6,000 and on the 24th a check from Mr. Wolfson for $13,000.
Those funds were subject to withdrawal on my signature, counter-
signed by either Mr, Griffin or Mr, Dodge Taylor, his associate. All
of those funds were transferred simply into the active or expenditure
account. Nothing further was put into that particular account be-
cause Mr. Griffin and Mr. Taylor were probably never available for
countersignature.
Mr. Halley. How did the money come into your hands — in the
, form of cash or check?
368 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. P'ant. It came in both ways. I have here a cash item of $13,800.
Mr. Halley. From whom ? Do you have a list there that you could
turn over to the committee?
Mr. Fant. Yes, sir; I do, except that I wouldn't be able to state
exactly from whom each item of cash comes, except that I think it
comes from either one of those three gentlemen. There were other
contributions made to the campaign ; for example, John Mathews had
a contribution of abut $7,000 that Mr, Kipnites made for him.
Mr. Halley. Who is Mathews ?
Mr. Fant. Mathews was the State senator in Duval County at that
time.
Mr. Halley. A man named Mathews was described yesterday as
having been attorney for a man named Sam Bratt, and also as a State
senator.
Mr. Fant. I don't know, to be perfectly honest to you, but that
man is a State senator and he is an attorney.
Mr. Halley. And did you say he gave $7,000 ? .
Mr. Fant. Yes, sir.
Mr. Halley. I don't see that on any of your lists ?
Mr. Fant. No, sir; he isn't there on any of these lists, but it is in
one of the memoranda here.
Mr. Halley. Who else made contributions?
Mr. Fant. Well, let's "see. I have here a group of minor contribu-
tions, because, frankly, with the exception of those three major ones,
it didn't amount to anything.
Mr. Halley. Why don't you hand over that stuff so the committee
can have the benefit of looking at it?
Mr. Fant. It is on hei-e, the names, J. McNulty, H. Hartleson, George
Topper, Allen Chase, Walter Warren, Charles Isler
The Chairman. We are not interested in all those names, Mr. Fant.
Mr. Halley. There were, in addition to your funds, a great many
local campaign funds raised for the Warren campaign that never
went through your hands; is that right?
Mr. Fant. Oh, yes, sir; because this merely opened and operated
the State campaign headquarters and the State advertising and the
State radio.
Ml-. Halley. So that the
Mr. Fant. The various county funds were all handled without us
having anything whatever to do with them.
Mr. Halley. Your principal duty was to disburse the sum of
$262,000; is that right?
Mr. Faxt. I personally disbursed the sum of $262,380.96. There was
an additional $22,550 that was disbursed by Mr. Wolfson, totaling
$284,939.96.
Mr. Halley. And that was just a portion of the cost of the total
campaign ?
Mr. Fant. That covered the first and second primaries of the cam-
paign; and, as I say, by the end of the second primary I was so con-
fused and exhausted from fooling with the thing that I didn't care to
carry on any further.
The Chairman. Mr. Fant, you have been around here and heard the
testimony. Were any of these so-called large-time operators or gam-
blers, or i-acketeers, sought for campaign purposes, or did they con-
tribute ?
ORGANIZED CRIME EST INTERSTATE COMMERCE 369
]\rr. Fant. Well, I haven't seen anybody, Mr. Kefauver.
The Chairman. I didn't mean by you. You were just the treasurer.
Mr. Fant. Not to my knowledge, anyone. I have heard William
Johnston bandied around a <>ood bit here in this connection, but, as
-far as I am concerned, it is yet to be shown that he is a laro;e-time
racketeer.
The Chairman. How about these S and G Syndicate men; do you
know their names ?
Mr. Fant. I never heard of the S and G Syndicate until 1 ^ot down
here to this investigation, sir.
The Chairman. Where is the full list of those who contributed, ]\Ir.
Fant ? Is that the list you gave us ?
Mr. Fant. Yes, sir; that and these other things here. These two
pieces of paper are the fidl list of them.
The Chairman. These two pieces of paper here are the full list of
contributors that came to you?
Mr. Fant. Yes, sir; that and this you see here [indicating].
- The Chairman. Let's see those, Mr. Fant. [Documents are handed
to the chairman.]
Mr. Fant. Now here is a memorandum that was in there that you
may take a look at.
Mr. Halley. Will you read the memorandum that you referred to?
Mr. Fant. Yes, sir. This memorandum says : "Policy Committee :
J. Turner Butler, John jNIathews, Joe Sears, Louis Wolfson, Ehydon,
Lathan. John Rush, Julian Fant, Frank Wright, Brown Whatley, and
Robert Smith.'' Then down below that — I am in error about the
amount. John Mathews $8,000 instead of $7,000, William Johnston
■$7,000. This "F" here, I am not sure about that, whether it is some-
thing INIr. Wolfson had brought in.
' Mr. Halley. Why woidcl you put down an initial instead of the full
name of the contributor?
■ Mr. Fant. If you will just take a look at this thing, apparently it
was written quite in a hurry, trying to keep some sort of a memoran-
dum on it. Billy Baufield is down here for $50.
The Chairman. Mr. Fant, these copies, are they made for us?
-' Mr. Fant. Well, they weren't made for you. They were made to re-
'fresh my memory, but you are certainly welcome to them.
Mr. Halley. Now the committee would like to keep the documents
for a short period and study them and they will be returned to you.
The Chairman. Wliat time will you be going back tomorrow, Mr.
Fant.
Mr. Fant. I don't know, since I don't know what time the Delta
plane leaves out of here.
The Chairman. Are these records in storage ?
Mr. Fant. No.
The Chairman. Well, anyway I will get them back to you in a very
few days.
The Chairman. Is Mr. W. O. Crosby here ?
Mr. Halley, Will you come around here, Mr. Crosby ?
The Chairman. Mr. Crosby, do you solemnly swear that the testi-
mony you will give this committee will be the truth, the whole truth,
and nothing but the truth, so help you, God 'i
Mr. Crosby. I do.
370 ORGANIZED CRIME IN INTERSTATE COMMERCE
TESTIMONY OF WILLIAM 0. "BING" CROSBY, INVESTIGATOR FOR
THE GOVERNOR OE THE STATE OF FLORIDA, ACCOMPANIED BY
MR. STARREY, ATTORNEY, TALLAHASSEE, FLA.
Mr. Starrey. Mr. Chairman, I am appearing as counsel for Mr.
Crosby. I am from Tallahassee.
The Chairman. What is your full name, Mr. Crosby ?
Mr. Crosby. William O. Crosby.
Mr. Halley. And what is your occupation ?
Mr. Crosby. Investigator for the Governor of the State of Florida.
Mr. Halley. Did you have occasion to make an investigation in
Miami and Miami Beach during the month of January 1949 ?
Mr. Crosby. Yes, sir.
Mr. Halley. On those occasions did you meet and talk to Sheriff
Sullivan ?
Mr. Crosby. Yes, sir, I met Sheriff Sullivan and talked to him
several times.
Mr. HalliEY. Would you state the circumstances and the conversa-
tion ?
Mr. Crosby. Well, I went in to see the sheriff
The Chairman. A little louder, please.
Mr. Crosby. Well, I went in to see the sheriff and presented my
credentials to him and told him that I was down in this part of the
State and I liad been sent down here by the Governor's office to check
on various matters, slot machines, and the illegal gambling and if any
that was found I would make reports to them.
The Chairman. Did you mention slot machines previously?
Mr. Crosby, Yes, I mentioned slot machines, but I mention them to
every sheriff when I go
Mr. Halley. Did you have instructions in writing from the
Governor ?
Mr. Crosby. No, sir, I didn't have any instructions in writing from
the Governor. All I had was my identification.
Mr. Halley. Did you have a letter from the Governor to Sheriff
Sullivan ?
Mr. Crosby. No, sir, I didn't have a letter for Sheriff Sullivan from
the Governor.
Mr. Halley. Were you here when he testified today ?
Mr. Crosby. Yes, sir.
Mr. Halley. Did you hear him talking about some written instruc-
tions ?
Mr. Crosby. The sheriff possibly referred to a letter he may have
received from the Governor.
Mr. Halley. He said you handed him a letter ?
Mr. Crosby. I don't recollect handing him a letter. The only letter
that I recollect handing him, Mr. Halley, would be my identification
here that I present wiien I go in any sheriff's office or anyone else's
that I come in contact with in an investigation.
Mr. Halley. And you received that back ?
Mr. Crosby. Yes, sir.
Mr. Halley. You were appointed by Governor Warren as a special
investigator for the Governor of the State of Florida on Januarv 10,
1949; is that right?
Mr. Crosby. Yes, sir.
ORGANIZED CRIME IN INTERSTATE COOVTMERCE 371
Mr. Halley. And what were your instructions from the Governor ?
Mr. Crosby. My instructions from the Governor were that he was
absohitely against slot machines, and he wanted me to be on a con-
tinual lookout for them. Any that I saw I was to report them into
the office or report them to the sheriff and make any other investiga-
tion that might come out of his office by assigning me some old homi-
cide cases to work on from the office there. And, of course, at various
times I would get different matters of investigation out of his office.
Mr. Halley. Did you get your instructions directly from the Gov-
ernor ?
Mr. Grosby. Well, I would get them sometimes from the Governor
and sometimes I would get assignments from the secretary, and some-
times from his assistants.
Mr. Halley. When you were appointed, what was the first investi-
gation you made ?
Mr. Crosby. Well the first investigation I made, I believe the Gov-
ernor told me that he heard that there were slot machines and he
wanted me to check into that and see if there were slot machines in
Florida, in Clay and Alachua Counties, I believe.
Mr. Halley. How long after you were appointed did you go to
Miami ?
Mr. Crosby. Well, I wouldn't be positive, but I would say maybe
it was around the — around 10 days or 2 weeks.
Mr. Halley. You were appointed on the 10th of January?
Mr. Crosby. Yes, sir.
Mr. Halley. Were you in Miami by the 20th ?
Mr. Crosby. I wouldn't be positive. I would say maybe around in
that neighborhood.
Mr. Halley. About the 20th, in Miami, in any event ?
Mr. Crosby. Around that neighborhood, yes, sir.
Mr. Halley. When you went to Sheriff Sullivan did you tell him
what the Governor had told you to investigate ?
Mr. Crosby. Yes, sir.
Mr. Halley. To the best of your ability to recall, what did you
say to Sheriff Sullivan ?
Mr. Crosby. To the best of my ability, I believe that I mentioned
something to him. I asked him if he had any slot machines down
here.
Mr. Halley. You asked him about slot machines?
Mr. Crosby. Yes, sir.
Mr. Halley. What did he say?
Mr. Crosby. He said there wasn't any that he knew of.
Mr. Halley. What did you say then ?
Mr. Crosby. And I told him that I was here to check on the thing,
and to check on anything that was illegal, and I was willing to
cooperate with him.
Mr. Halley. Did you ask him for the assistance of one of him men ?
Mr. Crosby. Well, I don't recall at all. I don't remember asking
him right at that time. When I was there for a while
Mr. Halley. When did you ask for the assistance of a man? '
Mr. Crosby. Well, it might have been a couple of days later as I
was going to do some checking around. I wanted to keep in touch
"with his office.
372 ORGANIZED CRIME IX INTERSTATE COMMERCE
Mr. Halley. When yon went back to his office, what did vou tell
him?
Mr. Crosby. I don't remember jnst what I told him — the words.
Mr. Halley. What was the conversation?
Mr. Crosby. Well, that I had fonnd some booking and also I believe
I told him that I had seen some gambling.
Mr. Halley. Did you ask him for a deputy sheriff to help you make
arrests?
Mr. Crosby. I asked him for a deputy to assist me ; yes, sir.
Mr. Halley. Did you at that time have a map or a chart showing
where you fonnd the gambling?
Mr. Crosby. No, sir ; I don't recall having any map or chart.
Mr. Halley. And you were introduced to Sheriff Burke, Deputy
Sherilt' Burke?
Mr. Crosby. Yes. sir.
Mr. Halley. And you and Burke got into a quarrel ?
Mr. Crosby. No.
Mr. Halley. You went out to the beach ?
Mr. Crosby. That is right. Well, I don't remember if we went
right to the beach or not. We possibly did.
Mr. Halley. What happened after you and Burke began to in-
vestigate ?
Mr. Crosby. Well, I think there was some other boy that was with
us, too. I am not positive on that. I know that Burke was with me
some time by himself, and there was another boy that was along; I
don't recall his name. I had been in a place up on — I believe it was
the Palm Court Hotel — and we went back up there, but that place
was then closed. While we were there checking around we were asking
about keys to the rooms — the deputies were — as I didn't have any
authority myself as far as that was concerned. I don't have any
arresting power.
Mr. Halley. How did you and Burke get along? Were your
methods the same or were you in disagreement ?
Mr. Crosby. Well, naturally I think all officers have their own
routine which is just a little bit different.
Mr. Halley. Is your routine different from Burke's? He indicated
that you had an acute disagreement with him as to whether you should
break into these places or not, and he accused you that you had violated
the law and violated people's rights. Did that take ]ilare ?
Mr. Crosby. Well, in this instance, Mr. Halley, I think the instance
Mr. Burke had reference to there, was that the day that he and I
believe Deputy George Patton was along; we went to a place over
on Washington Avenue, I believe it was. I don't know whether it
was Washington Avenue now or not. We went into the hall of this
place there and I believe I had received that complaint out of the office,,
and some fellow came out of a door. We could hear something going,
on in there. Some felloAv came out of a door and as he came out of
the door, I believe this boy Patton grabbed him in the hall there and
pulled the door to behind him, and we waited around and ])retty quick
somebody else knocked on the door and the door was o|)ened and we
went in and there was a bedroom there and to the loft of tlio bedroom,
as yon go in, there was a swinging door on the inside of there, and
there was another door on the inside of that. These fellows wer^
ORGANIZED CKIME IN' INTERSTATE COMMERCE 373
trying to get this door closed and Burke kept closing it and there was
a battery of phones in there.
Mr. Halley. Right after that, according to Burke, a lawyer named
Ben Colien came along. Do yon recall that?
Mr. Crosby. I remember Mr. Cohen's coming there.
Mr. Halley. Burke said something about you having a private con-
versation with Cohen ; that you had a conversation with Mr. Cohen,
do yon recall that ?
Mr. Crosby. No, sir; I don't recall having any private conversation
with Mr. Cohen at all.
Mr. Halley. Did you ever have any conversation with Mr. Cohen?
■ Mr. Crosby. I will tell you the truth, I didn't even know Cohen was
up there until we got ready to leave. I saw him out on the corner.
• Mr. Halley. Did you talk to him there?
Mr. Crosby. No, I don't remember that. I don't believe I talked to
Mr. Cohen at all.
' Mr. Halley. Well, Mr. Cohen appeared twice when you made
arrests with Burke ; is that right ?
Mr. Crosby. Mr. Cohen appeared two or three times on the scene.
'. Mr. Halley. Were you surprised at IVIr. Cohen's ability to appear
on the scene so soon after you did?
■ Mr. Crosby. I kind of wondered sometimes, you know, why he was
always "Johnny-on-the-spot."
Mr. Halley. Do you think somebody might have been tipping off
your raids ?
Mr. Crosby. I don't know. I wouldn't want to express my opinion.
Mr, Halley. It would look like it was, as they would be there almost
as soon as you were ?
Mr. Crosby. Somebody must have been calling him from these places
we went to.
Mr. Halley. Somebod}^ must have been calling him and getting
him over awful fast?
Mr. Crosby. Yes, sir.
Mr. PIalley. Did you ever have a conversation with Mr. Cohen
about gambling?
Mr. Crosby. I recall one day at the Palm Court Hotel, I believe 1
talked to Mr. Cohen there in front of the place. We were trying to
get in and look around for some places on the ground floor. As a
matter of fact we did finally get in, as they got a key, and there was a
battery of phones in there. I don't recall now whether they were
I hooked up or not, and Mr. Cohen was around there talking at that
i time.
Mr. Halley. And what was your conversation with Cohen ?
Mr. Crosby. I don't remember, not offhand, Mr. Halley.
Mr. Halley. Don't you remember an\1:hing. What did you talk
about ?
Mr. Crosby. Bookmaking.
Mr. Haij.ey. Did he ask you if you had a search warrant? You
must have talked of something.
Mr. Crosby. He might have said to one of the deputies did we have
a search warrant.
Mr. Halley. Well, what did you talk to him about?
Mr. Crosby. I was talking to him, I presume, about the situation.
374 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Hali-et. Had you ever seen Mr. Cohen under any other cir-
cumstances ? Were you ever in his office ?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever see him socially?
Mr. Crosby. Not that I remember; I might have.
Mr. Halley. Have you ever met liim any place besides on the two
or three occasions that you have just mentioned?
Mr. Crosby. I don't remember.
Mr. Halley. Is it possible that you may have ?
Mr. Crosby. I may have or I may not have.
Mr. Halley. I don't quite understand your answer.
Mr. Crosby. You asked me if I had ever seen him any place socially
or anything like that.
Mr. Halley. Did you see him any place besides those three or four
occasions you just mentioned?
Mr. Crosby. I don't recall.
Mr. Halley. Is it your answer that you didn't, to the best of your
recollection ?
Mr. Crosby. I wouldn't say that I hadn't, but I just don't remember.
Mr. Halley. Do you know any members of the S. & G. Syndicate?
Mr. Crosby. Do I know any members of the S. & G. ?
Mr. Halley. Yes. Sam Cohen, Harold Salvey, Charles Fried-
man, Eddie Rosenbaum, Jules Levitt, Harry Russell, then there is
Benton, and Leo Levitt, who is Jules Levitt's brother.
Mr. Crosby. Sam Cohen is the one I am thinking about. I went to
the Island Club and I believe I met Sam Cohen then.
Mr. Halley. Did you find gambling out at the Island Club ?
Mr. Crosby. No, sir; not at that time.
Mr. Halley. You are positive you didn't ?
Mr. Crosby. Yes, sir.
Mr. Halley. Did you see a room set up for gambling?
Mr. Crosby. No, I went in and they got a big iron door. They
were to let me in and there was a big room in there but I didn't see
any gambling equipment.
Mr. Halley. Do you know Jack Friedlander?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever hear of him ?
Mr. Crosby. I have heard of him.
Mr. Halley. But you never met him ?
Mr. Crosby. No, sir.
Mr. Halley. Never talked to him in your life ?
Mr. Crosby. No, sir.
Mr. Halley. Have you collected any campaign contributions?
Mr. Crosby. No, sir.
Mr. Halley. In the campaign of 1948 ?
Mr. Crosby. No, sir.
Mr. Halley. Did you participate in that campaign ?
Mr. Crosby. I participated to an extent. I acted for my friend
the Governor.
Mr. Halley. Did you collect any campaign contributions during
1949?
Mr. Crosby. No, sir.
'ORGA]SriZE,D CRIME IN ESTTERSTATE COMMERCE 375
Mr. Halley. Did you make any collection, of moneys for any pur-
pose during 1949 ?
Mr. Crosby. No, sir.
Mr. Halley. Do you know George Bowers ?
Mr. Crosby. Yes, sir.
Mr. Halley. Who is lie ?
Mr. Crosby. Well, George is a boy I first saw in Jacksonville maybe
3 years ago.
Mr. Halley. Wliat does he do ?
Mr. Crosby. I don't know actually what he does. Of course, I have
heard.
Mr. Halley. Wliat have you heard ?
Mr. Crosby. I saw him here in Miami when I came down.
Mr. Halley. "What was he doing in Miami ?
Mr. Crosby. I saw him over in the Little Palm Club when I was
there.
Mr. Halley. What is the Little Palm Club.
Mr. Crosby. There was gambling going on there at the time and
I saw him in there and I reported it to the sheriff and it was closed
down.
IVIr. Halley. Wliat was he doing there ?
Mr. Crosby. Was walking around there.
Mr. Halley. Did he work for the State administration?
Mr. Crosby. Not that I know of.
Mr. Halley. Did you do any work for Bowers ?
Mr. Crosby. Wliat do you mean ? Wliat kind of work ?
Mr. Hali^ey. Did you work on any matters with Bowers either
public or private? Did you ever have any business with him?
Mr. Crosby. Only the fact that I would be around and maybe get
some information as to maybe where gambling was going or something
like that.
Mr. Halley. Wliat was he doing in Miami ? Was he investigating
gambling, too ?
Mr. Crosby. I don't know.
Mr. Halley. Is he a gambler?
Mr. Crosby. He is reputed to be. I don't know. I have never seen
him gamble.
Mr. Halley. Do you know John Rush ?
Mr. Crosby. Yes, sir.
Mr. Halley. How long have you known John Rush ?
Mr. Crosby. I guess I have known Mr. Rush I would say around
8 or 10 years.
' Mr. Halley. Wliile you were investigating gambling, did you re-
port from time to time to Rush?
]\Ir. Crosby. No, sir.
Mr. Halley. Did you talk to him about your investigation ?
]Mr. Crosby. No, sir.
;Mr. Halley. You say you don't know au}^ of the people in the
S. & G. Syndicate that I mentioned to you except this man Sam Cohen ?
Mr. Starrey. He didn't say that, Mr. Halley.
Mr. Halley. Then let me ask you this : Do you know Sam Cohen ?
Mr. Crosby. Yes.
Mr. Halley. Is that the only time you ever met him, at the Island
Club?
68958 — 50 — pt. 1 25
376 ;ORGANIZE.D CRIME IN INTERSTATE COMMERCE
Mr. Crosby. I believe so, yes, sir.
Mr. Halley. Harold Salvey?
Mr. Crosby. I don't know him ; no, sir.
Mr. Halley. Charles Friedman ?
Mr. Crosby. I don't know whether I know him or not. There was
some fellow came up there at this Palm Court Hotel when we were over
there with the deputy sheriff,
Mr. Halley. I think that the deputy identified him as Levitt ; but
in any event, if you know Friedman at all, you only know him from a
casual meeting ?
JNIr. Crosby. Yes, sir.
Mr. Halley. And no other association ?
Mr. Crosby. No, sir.
Mr. Halley. Do you know Jules Levitt ?
Mr. Crosby. Yes, sir.
Mr. Halley. How long have you known Jules Levitt ?
Mr. Crosby. I have referred to him. I first knew him when he came
to the Palm Court Hotel.
Mr. Halley. Have you seen him since then ?
Mv. Crosby. I saw^ him down on Washington Avenue.
]Mr. Halley. You mean when you made the arrest?
Mv. Crosby. Yes, sir.
IMr. Halley. Have you seen him since then ?
Mr. Crosby. I don't remember whether I have or not.
Mr, Halley. You have no relationship with him ?
Mr. Crosby. Not that I remember.
Mr. Halley. Have you had any business relationship with him ?
Mr. Crosby. No, sir.
Mr. Halley. Do you know Harr^^ Russell ?
Mr. Crosby. Yes, sir.
Mr. Halley, How long have you known Harry Russell ?
Mr, Crosby, I have known him a little over a year, I guess : a little
longer than that.
Mr. Halley. When did you first meet Russell ?
Mr. Crosby. I saw him over there on the beach when I first came
down here and started maneuvering around,
Mr. Halley, Where did you see him ?
Mr. Crosby. I don't remember just exactly the place where I saw
him.
Mr. Halley, Who introduced you to Russell ?
Mr. Crosby, Didn't anybody introduce me to him.
Mr, Halley, How did you happen to meet him ?
Mr, Crosby, I was around, checking those spots around, and it
looked like I would always see him around a lot of them.
Mr, Halley, And just bump into him when he was in these gam-
bling places; is that the point?
Mr. Crosby. I would see him around them sometimes in going
througli and around through those hotels and such as that.
Mr. Halley. Was he running a gambling place?
Mr. Crosby. Not to my knowledge.
Mr. Halley. Not at that time ?
Mr, (Crosby, Not to my knowledge.
Mr. Halley. He joined tlie S. & G. Syndicate shortly thereafter,
didn't he?
ORGANIZED CRIME IN INTERSTATE COMMERCE 377
Mr. Crosby. Not to my knowledge.
Mr. Halley. Yon know lie is a member of the S. & G. Syndicate,
don't yon ?
Mr. Crosby. I do not : only wdiat I have heard here.
Mr. Halley. How often wonld you say yon saw Mr. Russell when
you met him in Miami Beach?
Mr. Crosby. Maybe I liave seen him half a dozen times, or more.
Mr. Halley. Yon think yon have seen him a half dozen or more
times 'i
Mr. Crosby. Yes, sir.
Mr. Halley. Have you ever seen him except in the gambling room
of a hotel ?
Mr. Crosby. I never have seen him in gambling rooms.
Mr. Halley. Where had you met him on those half-dozen occasions?
Mr. Crosby. I have seen him around in these hotels on Miami Beach
and at the Miami Beach Kennel Club.
Mv. Halley. Is that the club of which Mr. William H. Johnston
is president?
Mr. Crosby. Yes, sir.
Mr. Halley. Dicl you see him there with Mr. Johnston ?
Mr. Crosby. I didn't see him there with Mr. Johnston.
Mr. Halley. Do you know Johnston ?
Mr. Crosby. Yes, sir.
Mr. Halley. Have you ever seen Russell talking to Mr. Jolniston?
Mr. Crosby. I have seen him pass the time of day.
Mr. Halley. What do you mean by "passing the time of day" ?
Mr. Crosby. I mean be over at the Kennel Club there and there
would be a chat around, you know.
Mr. Halley. You have seen Harry Russell and William Johnston
together; is that right?
Mr. Crosby. I have seen him over at the Kennel Club. I have seen
Harry Russell at the Kennel Club and Johnston would be over there.
j\Ir. Halley. Have you seen them together?
Mr. Crosby. I guess I have — just seen them standing up together.
Mr. Halley. Talking together?
Mr.. Crosby. Yes, sir,
Mr. Halley. Did you ever join them and talk to both of them?
Mr. Crosby. Not that I remember .
Mr. Halley. Yon know them both ?
Mr. Crosby. Yes, sir.
Mr. Halley. Yon didn't walk over and talk to them?
Mr. Crosby. Not that I remember.
INIr. Halley. You never have been in a conversation with Johnston
and Russell together?
Mr. Crosby. Not that I remember.
Mr. Halley. Have you ever had a private conversation with Rus-
sell?
Mr. Crosby. Yes ; I have talked with him — to get some information.
Mr. Halley. What kind of information?
Mr. Crosby. Gambling information.
Mr. Halley. What kind of gambling information did he give you?
Mr. Crosby. He gave me some information on books and things like
that. In getting my information I would have to be around those kind
of people to get tliat kind of information.
378 ORGAISnZED OREME EN" TNTERSTATE COMMERCE
Mr. Halley. Is Jolinston also one of the people that you get infor-
mation from ?
Mr. Crosby. No, sir.
Mr. Halley. How many other gamblers on Miami Beach give you
information besides Harry Russell ?
Mr. Starrey. Mr. Chairman, I would like to interpose an objection
for this reason: This witness is one of the special investigators tor
the Governor's office. I would like to preserve the source of his in- i
formation because it is possible that he will want to use the same
sources of information in the future. I see no possible good that
can be accomplished in requiring the witness to divulge the confi-
dential sources of information to an investigation of this kind, which
information is hard to get.
The Chairman. The question was: How many other people give
him information ? I can't see how that would
Mr. Starrey. I have no objection to the number. I understood the
question to be "Who were they?"
Mr. Halley. Let's get the number first.
Mr. Crosby. I would get information from various people, Mr.
Halley.
Mr. Halley. In addition to Harry Russell ?
Mr. Crosby. Anybody that I could get any information from.
Mr. Halley. You didn't get information from Sam Cohen did you ?
Mr. Crosby. No, sir.
Mr. Halley. Or Harold Salvey ?
Mr. Crosby. No.
Mr. Halley. Or Friedman?
Mr. Crosby. No.
Mr. Halley. Eddie Rosenbaum ?
Mr. Crosby. No.
Mr. Halley. Jules Levitt?
Mr. Crosby. No, sir,
Mr. Halley. Jack Friedlander?
Mr. Crosby. No ; I never did.
Mr. Halley. But you did get information from Harry Russell ?
Mr. Crosby. I think I got information at times from him.
Mr. Halley. Did you ever carry messages from William Johnston
to Harry Russell ?
Mr. Crosby. No, sir. '
Mr. Halley. Did you ever carry messages from Harry Russell toi
William Johnston?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever carry messages from Harry Russell to
Rush?
Mr. Crosby. No, sir.
Mr. Halley. John Rush?
Mr. Crosby. No, sir.
Mr. Halley. Or from Johnston to Rush?
Mr. Crosby. No, sir.
Mr. Halley. Or in the other direction, from Rush to Johnston or
Russell?
Mr. Crosby. I beg your pardon ?
]\Ir. Halley. Did you ever carry messages from Rush to Johnston or
to Russell?
Mr. Crosby. No, sir.
ORGANIZED OREVIE IN INTERSTATE COMMERCE 379
Mr. Halley. Did you ever carry any money to Rush ?
Mr. Crosby. I don't know. I have been to the dop: track ^yitll him
and maybe buy a ticket or something like that, or he would ask me
how about cashing a ticket for him or something like that. I think
I have done that.
]Mr. Hallf.y. Did you ever hand any sums of money in excess of $100
to Eush?
Mr. Crosby. No, sir.
Mr, Halley. On no occasion?
Mr. Crosby. No, sir.
Mr. Halley. Have you ever seen Rush and Harry Russell together,
Mr. Crosby. I don't remember.
Mr. HalIvEY. Do you know whether Rush knows Russell?
Mr. Crosby. I don't know whether he does or not, Mr. Halley.
Mr. Halley. Have you ever talked on the telephone to Russell ?
Mr. Crosby. I don't remember whether I have or not.
Mr. Halley. Is it possible that you did ?
Mr. Crosby. It is possible that I might have.
Mr. Halley. Did Russell ever call you ?
Mr. Crosby. He might have. I don't remember.
Mr. Halley. Would you say that you saw Russell at the Palm
Court Hotel?
Mr. Crosby. No, sir, I didn't see him there.
Mr, Halley. You say you had been at the Palm Court Hotel ?
Mr. Crosby. Yes ; I have been there.
Mr. Halley. Did you ever make an arrest at the Palm Court Hotel ?
Mr. Crosby. No, sir. Tlie time that I was there with the deputy to
go to the bookie place — when I came back it was closed up.
Mr. Halley. It was closed up?
Mr. Crosby. It was closed by the deputies. I came back with the
deputies and it was closed up.
Mr. Halley, I have nothing else at this time.
The Chairman. Mr. Crosby, the idea is : Wliy would Russell give
you information?
Mr. Crosby, Well, the only thing I know. Senator, would be that
I am seeking information from anybody that I can get it from.
The Chairman. Did you just meet him and start asking for in-
formation ?
Mr. Crosby. I would see him around some of these places sometimes
when I was going around and checking.
The Chairman. And you understood that he was in the gambling
business himself, or that we was around these places ?
Mr. Crosby. I don't know he is a gambler.
The Chairman. Wliat did you understand his business was? That
is the point.
Mr. Crosby. I don't know.
The Chairman. Can you give any good reason why he would give
you information ?
Mr. Crosby. No, sir, except he gave it to me. That is all.
The Chairman. Was he very free in giving it to you ?
Mr. Crosby. Hanging around and going around in places like that,
you sometimes get information free.
The Chairman. Was he one of your chief informants ?
380 lORGAJS^IZED CRIME IN INTERSTATE COMMERCE
Mr. Crosby. I wouldn't say that he was one of my chief informants.
The Chairman. All right. That is all.
Mr. Halley. I have one more question if you don't mind.
Did William Johnston assist you in getting your appointment as
special investigator?
Mr. Crosby. No, sir.
JNIr. Halley. Did you ever discuss your desire to obtain that ap-
pointment with William Johnston ?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever discuss the appointment as special in-
vestigator with William Johnston at all ?
Mr. Crosby. Not to my knowledge ; not that I remember.
Mr. Halley. Did anybody recommend vou to Governor Warren for
that job?
Mr. Crosby. Let me tell you this way : I have known the Governor
for 20 years and we have been good friends. I knew him when he
was in the city council up there. I was for him in every campaign
that he ever ran.
Mr. Halley. Did anybody recommend you for that job?
Mr. Crosby. Not to my knowledge ; not that I know of. I made the
application to the Governor and talked to him about it.
Mr. Halley. And 3'ou had the support of no other person than
your own self ?
Mr. Crosby. I wouldn't think that I needed the support of anyone
else, knowing the Governor as well as I do.
Mr. Halley. The question is : "Did you have the support of anybody
else?" not whether you needed it.
Mr. Crosby. Not to my knowledge.
Mr. Starrey. May I ask the witness a question for the purpose of
the record ?
The Chairman. Yes, we would be glad to have you ask the witness
such questions as you wish for the record.
Mr. Starrey. What police experience, Mr. Crosby, did you have
prior to the time you became an investigator ?
Mr. Crosby. I was almost 10 years on the Jacksonville police de-
partment.
Mr. Starrey. In what capacity ?
Mr, Crosby. First I was a patrolman and then I was the secretary
to the chief for a while, and then I was in the detective division for
about 7 years.
Mr. Starrey. That is all.
Mr. Halley. After the arrests that you made with Burke and the
one with George Patton, did you make any other arrests at Miami
Beach ?
Mr. Crosby. We made several arrests over there, Mr. Halley.
Mr. Halley. You and Burke have both testified as to having made
certain arrests. Did you make any others ?
Mr. Crosby. There were arrests with Patton and some other boy.
I don't know what his name was.
Mr. Halley. How many arrests did you make at Miami Beach?
Mr. Crosby. I don't remember how many.
Mr. Halley. Did you make over 10 ?
Mr. Crosby. I wouldn't want to say. I wouldn't remember.
ORGANIZED ORIME ESI INTERSTATE COMMERCE 381
Mr. Halley. Did you make as many as 10 ?
Mr. Crosby. I wouldn't say positive.
Mr. Halley. How long did your investigation take altogether be-
fore you stopped making arrests on Miami Beach?
Mr. Crosby. I worked over there and left here and I was in Miami
quite a bit.
Mr. Halley. How long a bit?
Mr. Crosby. I don't remember just exactly how long, bvit I know
it was quite a while.
I had been to the sheriff's office many, many times.
Mr. Halley. Were you working in Miami Beach a month?
Mr. Crosby. I worked over a month, but I wouldn't say that I
worked a month at one time.
Mr. Halley. You weren't there a month?
Mr. Crosby. I mean straight through.
Mr. Halley. On and off. You came to Miami, you testified, toward
the end of January ?
Mr. Crosby. Yes.
Mr. Halley. Did you make any arrests at late as March?
Mr. Crosby. I wouldn't want to say, Mr. Halley, because I am not
sure.
Mr. Halley. Did you make any record of your investigation? Do
you have an official report?
Mr. Crosby. No; I don't have an official report, because I just went
with those — I would get that information and I would either turn it
over to the sheriff — a lot of them I turned over to the sheriff, and then
I didn't fool with it at all.
Mr. Halley. Didn't you keep a memorandum or a report of what
you do in your job ?
Mr. Crosby. When they require a report into the office, I give them
a report. If they want a written report, I give them a written report,
and if they want an oral report I give them an oral report.
Mr. Halley. Have you given any written report on the Miami
situation ?
Mr. Crosby. I don't remember whether I have or not.
Mr. Halley. What do you mean "you don't remember?" You must
know Avhether you wrote a written report or not. Do you keep copies
yourself? Of reports you make?
Mr. Crosby. Of reports I make I keep a copy.
Mr. Halley. For instance, did you ever report to anybody in an
official report that you were getting information from Harry Russell?
Mr. Crosby. No, sir.
Mr. Halley. You did not?
Mr. Crosby. No, sir.
Mr. Hao.ey. When you make official telephone calls, do you put in
an expense voucher for them ?
Mr. Crosby. Do I put in an expense voucher for them ?
Mr. Halley. Yes.
Mr. Crosby. No, sir.
Mr. Halley. You don't put in an expense voucher for your official
telephone calls?
Mr. Crosby, No. sir.
Mr. Halley. What is your salary as a special investigator?
Mr. Crosby. I usually call them collect a lot of times.
382 lORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Do you ever call without calling collect ?
Mr. Crosbt. Yes, I have called.
Mr. Halley, You called Harry Russell long distance, didn't you ?
Mr. Crosby. I don't remember.
Mr. Halley. Never called Harry Russell long distance?
Mr. Crosby. I don't remember calling him.
Mr. Halley. Did Harry Russell ever call you long distance?
Mr. Crosby, He could have ; yes.
Mr. Halley. Did he?
]Mr. Crosby. I don't remember. If the record says he did, he did.
Mr. Halley. Let's get back to the dates. Have you any memoranda
or any notes or anything at all that vrould refresh your recollection
as to whether you had made any arrests on Miami Beach after March
1, 1949?
Mr. Crosby. I feel like there were arrests made after then.
Mr. Halley. Aside from your feeling.
Mr. Crosby. At least I feel certain I carried information to the
sheriff's office after then.
Mr. Halley. Did you carry information to the sheriff's office on
the basis of which you went out with the sheriff's deputies to make
arrests which you made in January?
Mr. Crosby. Will you state your question again ?
Mr. Halley. In January you went to the sheriff's office with infor-
mation and you got in a car with a deputy sheriff and you went
out and made arrests; isn't that right?
Mr, Crosby, That is right.
Mr. Halley. Did you do anything like that in February?
Mr. Crosby. I don't remember, but I feel certain I did,
Mr. Halley. You must know whether you did or didn't. It is not
a matter of feeling. You are an investigator.
Mr. Crosby. I went out with the sheriff's men several times,
Mr, Halley, When you report to the Governor, do you tell him that
you feel you made an investigation ? You apparently made no record.
You didn't make any an^ests after March ?
Mr. Crosby. I don't remember, Mr. Halley.
Mr. Halley. In fact, Harry Russell became a member of the S, & G.
Syndicate in March 1949 ; didn't he ?
Mr. Crosby. Not to my knowledge.
Mr. Halley. Not to your knowledge?
Mr. Crosby. I don't know whether he is a member of the S. & G.
Syndicate or not.
Mr. Halley. Did you ever hear that he became a member of the
S. & G. Syndicate in March of 1949?
Mr. Crosby. All I have heard about it is right in here.
Mr. Halley. And you never heard about it before that?
Mr, Crosby. No.
Mr. Halley, You were appointed an investigator when ?
Mr, Crosby. January 1949.
Mr. Halley, You showed the committee a letter indicating you were
appointed on January 10; is that right?
Mr, Crosby, Yes, sir,
Mv. Halley, How long after that was it that you met Harry Russell ?
Mr. Crosby, The latter part of January or the first part of Feb-
ruary.
'O'RGAlsriZED ORIME IN INTERSTATE COMMERCE 383
Mr, Halley. Durin^^ the course of your investigations ; is that right ?
Mr. Crosby. Yes, sir; during the course of my investigation.
Mr. Halkey. And j'ou are quite sure you never saw him before you
happened to notice him lying around various places in Miami Beach ;
is that right?
Mr. Crosby. No, sir; never have.
Mr. Hai.ley. Nobody ever introduced you to him ?
Mr. Crosby. No, sir.
Mr. Halley. Is it possible that you knew Mr. Harry Russell earlier
than January of 1949 ?
Mr. Crosby. No, sir.
Mr. Halley. Is it possible that you continued your relationship with
him after you stopped investigating at Miami Beach?
Mr. Starrey. Mr. Chairman, the witness has not testified that he
has quit investigating at Miami Beach. He is still an investigator for
the Governor's office.
Mr. Halley. Are you still investigating at Miami Beach ?
Mr. Crosby. When I get an assignment, I will.
Mr. Halley. When did you last get an assignment for Miami
Beach?
Mr. Crosby. My last assignment? I w^as here in March or April;
I don't remember just exactly when.
Mr. Halley. Did vou cause an arrest to be made at Miami Beach
after March of 1949?
Mr. Crosby. I wouldn't say, Mr. Halley.
Mr. Halley. You wouldn't say or you couldn't say ?
Mr. Crosby. I wouldn't say whether I did or whether I didn't. I
kept carrying information in to the sheriff's office.
Mr. Halley. What information did you carry to what sheriff?
Mr. Crosby. Bookie places.
Mr. Halley. To what sheriff?
Mr. Crosby. Jimmy Sullivan's office.
Mr. Halley. Did you give him any memoranda or did you write
him a letter?
Mr. Crosby. Just carried him the information and gave it to him
and told him about it orally, and if the sheriff wasn't in, I would tell
his deputy.
Mr. Halley. You never went out on an arrest again?
Mr. Crosby. I wouldn't say that I didn't.
Mr. Halley. Would you say that you did ?
Mr. Crosby. I wouldn't say that I didn't and I wouldn't say that I
did. I wouldn't remember.
The Chairman. If you went, would you remember or not?
Mr. Crosby. I went several times, Senator ; yes, sir.
The Chairman. You must remember. In January and in February
you were here and you went with Mr. Burke several times. You ought
to remember either whether you did or didn't make any arrests after
March. We just want to get the facts of this matter, that is all.
Mr. Crosby. That has been over a year ago, and it is a little hard to
remember.
The Chairman. You were able to remember the ones in Januaiy and
February.
Mr. Crosby. That is when I first started to work.
384 .ORGANIZED OREVIE IN INTERSTATE COMMERCE
The Chairman, .Harry Russell is one of the men that was supposed
to appear here. Mr. Halley just received a letter from an attorney for
Mr. Russell, which I will ask him to read.
Mr. Halley. You don't know Mr. Russell ?
Mr. Crosby. I know him when I see him ; yes.
Mr. Halley. Have you ever seen him in Chicago ?
Mr. Crosby. Not that I remember.
Mr. Halley. You know he comes from Chicago ; don't you ?
Mr. Crosby. I have heard it.
Mr. Halley. Do you know that William Johnston comes from Chi-
cago ?
The Chairman. Let me get this : Did you say you didn't remember
seeing him in Chicago, or just may have or may not have? Which
was it ?
Mr. Crosby. I don't remember whether I have ever seen him in
Chicago or not.
The Chairman. When were you in Chicago ?
Mr. Crosby. When was I in Chicago ? I was in Chicago in August
of last year.
The Chairman. What did you go up there for ?
Mr. Crosby. I went to the All-Star football game.
The Chairman. Did you see Mr. Russell on that occasion?
Mr. Crosby. I don't remember whether I did or not.
The Chairman. You know Mr. Russell ?
Mr. Crosby. I know him, sure, but I don't remember. There was a
lot of people there.
The Chairman. Did you talk with Mr. Russell in Chicago in
August of last year when you went up there ?
Mr. Crosby. I wouldn't know whether I talked with him or not.
I don't think I did ; no, sir.
The Chairman. Don't you remember whether you did or not ?
Mr. Crosby. I don't remember. Senator.
The Chairman. How many days did you stay in Chicago ?
Mr. Crosby. I stayed about a couple or 3 days.
The Chairman. Did you go by yourself ?
Mr. Crosby. I went up by myself; yes, sir, and came back by
myself.
The Chairman. And someone you had seen here often you wouldn't
remember whether you saw them or not ?
Mr. Crosby. I don't remember whether I saw him in Chicago or
not?
Mr. Halley. Did you see Johnston in Chicago ?
Mr. Crosby. Yes.
Mr. Halley. You went to Sportsman's Park ?
Mr. Crosby. Yes ; I believe I went out there one time.
Mr. Halijsy. And you saw Johnston there?
Mr. Crosby. Yes, sir.
Mr. Halley. Did you see Russell there?
Mr. Crosby. No, sir.
Mr. Halley. Do you know whether or not Russell is a racketeer in
Chicago ?
Mr. Crosby. Not to my knowledge ; no, sir.
ORGANIZED ORIME IN INTERSTATE COMMERCE 385
Mr. Halley. He is engaged in the gambling business there ; isn't he ?
Mr. Cbosby. No, sir ; not that' I know of.
Mr. Halley. At this point I would like to introduce the letter.
The Chairmax, Just read it.
Mr. Halley. This letter is from Luis Kutner, dated July 8, 1950,
and reads as follows :
I regret to advise that Harry Russell failed to appear in my office as he
agreed, but telephoned and stated he had no other choice than to take his
chances.
He stated that the Binaggio case history illustrates his point of view and
decision.
Therefore, I am returning herewith the original subpena and copy.
My best wishes and assurances of esteem.
Sincerely yours,
Luis Kutner.
Mr. Halley. Have you seen or heard from Russell in the last
month ?
Mr. Crosby. No, sir.
Mr. Halley. Have you talked to him on the telephone?
Mr. Crosby. No, sir.
Mr. Halley. What did you talk to Johnston about when you saw
him in Chicago ?
Mr. Crosby. What did I talk to him about? Johnston?
Mr. Halley. Yes.
Mr. Crosby. Just general conversation. It was a social gathering.
A lot of people came to the football game.
Mr. Halley. Did you ever talk to Jolinston about the S. & G.
Syndicate ?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever talk to Johnston about gambling at
Miami Beach?
Mr. Crosby. No, sir.
Mr. Halley. Never?
Mr. Crosby. No, sir.
Mr. Halley. On no occasions?
Mr. Crosby. No, sir.
Mr. Halley. Did you ever talk to him about your investigation ?
Mr. Crosby. No, sir; I didn't discuss mj- official investigation with
anybody except the persons involved.
Mr. Halley. And not with Mr. Johnston ?
Mr. Crosby. No, sir.
The Chairman. Did Mr. Sidlivan, the sheriff here, indicate that he
didn't want you around here ?
Mr. Crosby. I never heard of the sheriff saying that. I got full
cooperation from the sheriff'.
The Chairman. Did you hear that he felt he had his investigating
officers and he didn't need you around ?
Mr. Crosby. I never did hear him make that remark.
The Chairman. Do you feel that he cooperated with you very
well ?
Mr. Crosby. Yes, sir ; I do.
The Chairman. All right. That is all. Mr. Crosby.
Mr. Crosby. Thank you.
386 lORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Starrey. Mr. Chairman, may Mr. Crosby now be excused as a
witness ?
The Chairman. I think so ; yes.
Mr. Starrey. Thank you, Senator.
The Chairman. The committee will stand in recess until 9 : 30 in
the morning.
I want to thank the marshal and his deputies and all for their
attendance and for their help.
(Whereupon, at 10 : 55 p. m., the hearing was recessed until 9 : 30
the following day.)
INVESTIGATION OF OKGANIZED OEIME IN INTERSTATE
COMMERCE
SATURDAY, JULY 15, 1950
United States Senate,
Special Committee To In^testigate
Organized Crime in Interstate Coinimerce,
MiaTni, Fla.
(Hearing resumed at 9 : 45 a. m., on July 15, 1950.)
The Chairman. The committee will come to order. The chairman
has received a telegi'am from Mr. W. H. Johnston, Sportsman's Park,
3301 South Fifty-second Avenue, Cicero, 111., which telegram is as
follows :
Information has reached me through the press that you desire my presence
before your committee in Miami, Fla. No official notice has reached me. I am
perfectly willing to appear before your committee without being subpenaed.
However, a harness-racing meeting opens tonight at Sportsman's Park, of which
1 am president. Consequently it would be extremely inconvenient for me to
appear during the present hearings being held by your committee.
The harness-racing meeting runs through August. I am informed your com-
mittee will convene in Chicago on July 21. As I will be in Chicago at that time,
I will be glad to appear then, if you so desire. However, I shall appear at any
other future time you may designate, and in Washington, if you wish, at my
own expense.
My recent trip to Europe had been planned for many months for the purpose
of going with my wife and son to Rome, with passports and reservations predating
the organization of your committee. Any inference or charge that I have under-
world connections is without foundation and utterly false. If such charge has
been made to your committee during its current hearings, I assure you it has been
motivated by local politics there.
I welcome the opportunity to combat such false accusations by appearing before
your committee.
Mr. Johnston will be asked to appear before the committee either in
future sessions in this State or in public hearings somewhere else as
soon as possible.
Mr. Rush, come forward.
(Mr. Rush appears before committee.)
TESTIMONY OF JOHN ETJSH, ATTORNEY, JACKSONVILLE, FLA.
The Chairman. ISIr. Rush, do you solemnly swear that the testi-
mony that you are about to give this committee will be the truth, the
whole truth and nothing but the truth, so help you God?
]Mr. Rush. I do.
JNIr. Halley. Mr. Rush, have you produced certain papers and
documents pursuant to the subpena of the committee ?
Mr. Rush. I have.
387
388 (ORGANIZED CRIME IN UTTERSTATE COMMERCE
Mr. Halley. Will you now produce them for the committee ?
Mr. Rush. Yes. [Produces papers.] Would you like to take them
up in the order in which they come ?
Mr. Halley. Yes; just very briefly describe them.
Mr. Eusii. Do you have a copy of the subpena that gives the order
in which they come?
Mr. Halley. Just take them in any order at all.
Mr. Rush. As to the records of the S and G Investment Co., the
only records that I have on the S and G Investment Co. is a check that
Mr. Ben Cohen gave me in relation to a legislative matter that I was
associated in by him, Mr. Ben Cohen being an attorney of Miami
Beach.
Mr. Halley. What was the legislative matter ?
Mr. Rush. A matter pertaining to the legalizing of bookmaking in
the State of Florida.
Mr. Halley. That was Craig's baby, wasn't it ?
Mr. Rltsh. I don't know whether it was Craig's baby or not, but Mr.
Cohen was interested in it and associated me in the matter ; however,
I did not talk to Mr. Craig about it.
Mr. Halley. You know which Craig I am referring to, don't you ?
Mr. Rush. Yes.
Mr. Halley. What is his full name?
Mr. Rush. I don't know his full name.
Mr. Halley. Charles Craig?
Mr. Rush. I don't know what his full name is.
Mr. Halley. Raymond Craig, isn't it?
Mr. Rush. I just know his name to be Craig. I don't know what
Ids first name is.
Mr. Halley. He controls a lot of gambling over in Miami, doesn't
he?
Mr. Rush. I have heard that he did ; I do not know.
Mr. Halley. Hasn't he been trying to get that legalized bookmak-
ing bill through for many years ?
Mr. Rush. I understand that he had; yes.
Mr. Halley. Ben Cohen came to you and asked you to work on it ?
Mr. Rush. Yes.
INIr. Halley. In Tallahassee ?
Mr. Rush. No.
Mr. Halley. Wliere?
Mr. Rush. In my office and in his office. I had nothing to do(
with the lobbying through the legislature of it at all. I informed
Mr. Cohen when I was associated in it that I would not undertake the
lobbying of it. He discussed that with me also and I told him I
Avoukl not undertake the lobbying end of it.
Mr. Halley. Wliat was your part in that bill?
Mr. Rush. It was in the collaborating on the drawing of it.
Mr. Hali.ey. You were retained to collaborate in dra^ying a bill
foi" legalized gambling?
Mr. Rush. Yes.
Mr. Halley. What fee was agreed that you would be paid for that?
Mr. Rush. I received a $10,000 retainer fee, with the understanding
that if the bill was ])assed I would get $10,000 more.
Mr. Halley. Just for drafting the bill?
Mr. Rush. Yes, and collaborating.
ORGANIZED CRIME IN INTERSTATE COMMERCE 389
Mr. Halley. Nothintr else ?
Mr. Rush. No.
Mr. Halley. How miicli time did it take to draft the bill ?
Mr. Rush. We worked on that bill off and on I would say — I had a
pretty good file on that — I would say we worked on that off and on for
2 or 3 months.
Mr. Halley, With whom did you confer about it?
Mr. Rush. Well, at one time I conferred with Mr. Raymond Craig
.about it.
Mr. Halley. When did you confer with Craig about it?
Mr. Rush. I conferred with Craig about it either just before or
during the session of the legislature. That is where I met Mr. Craig
in a meeting that they had on it.
Mr. Halley. Will you fix the time?
Mr. Rush. I said it was during the 1949 session of the legislature. I
don't remember the exact time.
Mr. Halley. What month was the legislature sitting; over what
period ?
: Mr. Rush. I think that was along in April.
Mr. Halley. Of 1949?
Mr. Rush. That is right.
Mr. Halley. When were you first retained, in April or before that?
Mr. Rush. That was in March 1949 ; March 29.
Mr. Halley. That you were retained?
Mr. Rush, That was the date when the check was deposited in my
bank account. It was shortly before that that I was retained, I would
say ; that is when I deposited the check through my firm account.
Mr. Halley. You had some conferences prior to that, didn't you,
Mr. Rush ?
Mr. Rush. Prior to the 29th?
]\Ir. Halley, Yes.
Mr, Rush. We had one conference prior to that ; yes.
]Mr. Halley. Wlien did you first confer with Craig about it?
Mr. Rush. The only time I conferred with Craig about it was
after the bill was already in preparation, and Mr. Craig had a bill
also. It seems that there were two or three different bills that dif-
ferent ])eo]:)le were wanting to go in there, and they had a conference
about seeing if they couldn't get together on all of them. That is the
first time I ever met him.
Mr. Halley. Did anybody else pay you a fee in connection with
getting that legalized betting bill passed?
Mr. Rush. No.
Mr. Halley. Did Mr. Craig tell you that he had had a conversation
with Ben Cohen about it ?
Mr. Rush. No, sir.
Mr. Halley. Did Mr. Cohen tell you of a conversation that he had
had with Raymond Craig about it?
Mr. Rush. No, sir.
Mr. Halley, Ben Cohen was ready to pay you $20,000 if the bill
went through ?
Mr. Rush. That is right.
Mr. Halley. And had paid 10 of the 20, in advance ?
Mr. Rush. That is correct.
Mr. Halley. The bill never did go through ?
390 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. KusH. No, sir.
Mr. Halley. Mr. Kush, you are counsel for William H. Johnston ?
Mr. Rush. I am.
Mr. Halley. Are you on a retainer basis with him ?
Mr. Rush. No, sir. I say I am counsel for him. I represent two
dog tracks that he is president of, and in that way I would say that he
has no personal business or anything. When I say I am counsel for
him, I mean that I am a good friend of his, and if he had any business
I would represent him, but he has no personal business other than
the tracks. He never paid me a fee himself.
Mr. Halley. You never received a fee from Johnston ?
Mr. Rush. No.
Mr. Halley. You have received fees from the tracks ?
Mr. Rush. Yes.
Mr. Halley. Over what period ?
Mr. Rush. The Jacksonville track I think I have represented about
6 years. There is one in Tampa that I believe I have represented, to
the best of my recollection, about 8 years.
Mr. Halley. Did you represent William Johnston personally in
any capacity whatsoever?
Mr. Rush. No, sir; he never had any representation in his personal
matters.
Mr. Halley. Did you ever talk to him about the campaign of 1948
for Governor?
Mr. Rush. Yes, sir.
Mr. Halley. Did j-ou ever talk to him about the campaign con-
tribution ?
Mr. Rush. Did I?
Mr. Halley. Yes.
Mr. Rush. Yes.
Mr. Halley. State what conversations you had with him and, if
possible, fix the time and place.
Mr. Rush. We had quite a few conversations about it. Fixing the
time and place would be rather difficult.
Mr. Halley. Do the best you can.
Mr. Rush. Mr. Johnston talked to me about the campaign and told
me that he was going to support Mr. Warren, and asked me about it,
and we discussed it from time to time. Well, that has been ever since
Warren's first campaign that he talked about supporting Mr. Warren
from time to time as it came up.
I supported Governor Caldwell when he ran before, and I was very
active in his campaign, and at that time I was talking about it then,
and I was talking to Johnston about supporting Caldwell, and he
told me then that if Warren came })ack, e:ot out of the service and came
back and ran, he was going to support Warren, that he was a pei'sonal
friend of his and he was going to support Warren; if not, he would
sup])ort Caldwell. Mr. Warren didn't come back and he supported
Caldwell. In the conversations there was nothing definite. That
continued through a period of, I would say, 6 years.
Mr. Halley. Let's get down to 1948. Did 3'ou discuss a campaign
contribution for the 1948 campaign?
Mr. Rush. Yes.
Mr. Halley. Wliat were those discussions ?
ORGANIZED OREVIE IN INTERSTATE COMMERCE 391
Mr. Rush. I am trying to remember the first discussion we had on
it. I think that the first discussion we had on that was when they
first opened the campaign and he made a contribution, tlie amount of
which I don't know, but he made a contribution in there then, and
there w^as something said about it. I imagine the conversation you
want is whether or not he discussed the conversation that Mr. Griffin
testified about. Is that the conversation you woukl like to hear?
Mr. Halley. I would like to have them all. Let's have that one
first.
Mr. Rush. When you are with somebody quite a bit and you have
conversations back and forth, it is hard to pin it down.
Mr. Halley. Why don't you just start. I think the others w^ll
come along. Start on something; pick out any conversation.
Mr. Rush. Mr. Halley, you must understand that I want to co-
operate all I can.
Mr. Halley. I am sure you do.
Mr. Rush. When you say "just start and relate" conversations that
you have had with a person over a period of years, it is rather difficult
to do it. If you have any particular conversation in mind that you
would like to know about, I would be glad to tell you anything I know
about it.
Mr. Halley. Yes. Let's start with the first conversation you had.
Mr. Rush. As I said, the first conversation I had about it was
Mr. Halley. In 1948 ?
Mr. Rush. The first conversation in 194'8 ?
Mr. Halley. Yes.
Mr. RL'SH. Well, there is just nothing concrete about it; he just
said — I don't have any dates or anything — he said if Mr. Warren ran
for Governor he was going to support him, and when you mean to
support a man that naturally means that you are going to contribute
to his campaigii.
Mr. Halley. Didn't he tell you that he and Griffin were going to get
together and finance the campaign between them?
Mr. Rush. No; he didn't tell me that.
Mr. Halley. Didn't he tell you that he had a conversation first with
Griffin and another conversation with Wolfson?
Mr. Rush. That was quite a while after the campaign was in prog-
ress, and that is the reason I asked you if you wanted that particular
conversation.
Mr. Halley. How long after the campaign was in progress did you
first hear that story ?
Mr. Rush. I can't exactly pin the time on that, but I know from
the books of the campaign that it was after Mr. Fant had been ap-
pointed treasurer of the campaign. That is about as close as I can
come to it. I don't remember the date that Mr. Fant was appointed
treasurer, but it was after that date.
Mr. Halley. And what was that conversation ; what were you told ?
Mr. Rush. He told me that Mr. Griffin had come to him* and had
said that they didn't want to bog down for finances in this campaign
like they had in the 1940 campaign, and asked him whether or not he
would go along with Mr. Wolfson and underwrite the campaign, and
he asked me what I thought about it. I told him that I didn't think
it would be a good idea, that this campaign could get expensive, and
he said that he had been assured that the wdiole campaign wouldn'c
G8958 — 50 — pt. 1 26
392 ORGANIZED CRIME IN INTERSTATE COMMERCE
cost over $150,000 and that contributions would be comino- in from
other people, and that he thought he would go with it and under-
write it.
Mr. Hallet. Did you tell him it was illegal for him to make a cam-
paign contribution?
Mr. Rush. It is not illegal for him to make a campaign contri-
bution.
Mr. Hallet. It is unlawful, isn't it ?
Mr. EusH. No, sir.
Mr. Hallet. He is president of a dog track, is he not?
Mr. EusH. Yes.
Mr. Hallet. Isn't he a licensee under the Florida State corpora-
tion law ?
Mr. EusH. Yes.
Mr. Hallet. Isn't he the principal in the corporation?
Mr. EusH. Yes; he is one of the stockholders and president.
Mr. Hallet. Have you read the attorney general's testimony be-
fore this committee?
Mr. Rush. No, sir.
Mr. Hallet. The attorney general disagrees with you on the law;
do you know that ?
Mr. EusH. I am sorry. I am an attorney and he is an attorney, ,
and if he disagrees with me on the law, it is a difference of opinion.
Mr. Hallet. Do you on occasion disagree with yourself about the
law?
Mr. EusH. No.
Mr. Hallet. Do J'Ou recall having a conversation with an assistant!
counsel of this committee about Mr. William Johnston's avoidance of
the committee's subpena ?
Mr. EusH. No ; not about his avoidance. Mr. Johnston is not avoid
ing any subpena here.
Mr. Hallet. Mr. Downey Eice called you on the telephone, didn'tJ
he?
Mr. EusH. Correct.
Mr. Hallet. And he said that the committee had been unable tO'
find Mr. Johnston at his home.
Mr. EusH. Correct.
Mr. Hallet. And that the people at the various businesses con-
trolled by Mr. Johnston were unwilling to state where he was; isi
that correct?
Mr. EusH. I don't recall him saying that the people at the placesi
of business were unwilling to tell him where he could be located. He
asked me where Johnston could be located, and I told him where I
thought he could be located, and he told me that he had tried those
places and had been unable to locate him.
Mr. Hallet. What places were they?
Mr. EusH. The Blackstone Hotel in Chicago; the National Jockey
Club
Mr. Hallet. At Sportsman's Park, is it not ?
Mr. EusH. Yes.
Mr. Hallet. He told you that he had tried those places?
Mr. Eusii. And he said that Mr. Johnston wasn't there.
•ORGANIZED CRIME IN INTERSTATE COMMERCE 393
Mr. Halley. Do you recall at that time saying to him that Johnston
AYoukl probably not be available until after the opening of the track
at Sportsman's Park ^
Mr. Rush. No; I didn't tell him Mr. Johnston would not be avail-
able until after that. What I told him was this : That I was sure that
he could be reached by then, because he would be at the opening of
Sportsman's Park.
Mr. Halley. Didn't you also say that it would be very embarrassing
for Mr. Johnston to testify before that track opened because of his
campaign contribution here ?
Mr. Rush. Mr. Halley, this situation down here, I am sure
Mr. Halley. Please answer the question.
Mr. Rush. I would like to answer it.
Mr. Halley. I think you can answer it.
Mr. Rush. What was the question ?
Mr. Halley. Read him the question, Mr. Stenographer.
(Preceding question read by the reporter as above recorded.)
Mr. Rush. I don't think they are exactly the words. I did discuss
with Mr. Rice the situation of the contribution, and I asked Mr. Rice
if it would be possible for us to have a stipulation between counsel
where I would not be asked about the contribution where it might be
in the record, and Mr. Rice told me that he had no authority to enter
into any such stipulation.
Mr. Halley. You had a reason for asking that ?
Mr. Rush. Yes.
Mr. Halley. What was the reason you stated ?
]\Ir. Rush. Now you are getting down to the meat in the coconut.
Mr. Halley. I have been trying to get down to it.
Mr. Rush. And I have been trying to give it to you, but you wouldn't
let me answer.
Mr. Halley. Let's do it now.
Mr. Rush. This whole thing is a political fight.
Mr. Halley. Wliat whole thing?
Mr. Rush. The Miami Crime Commission and all of the people who
have been feeding you information.
Mr. Halley. Do you think this committee sitting here is having
a political fight?
Mr. Rush. No, sir; I think this committee sitting here — from what
I have seen of the chairman of the committee, I think he is most fair
to everybody — but I do say, Mr. Halley, that you have to have a source
of information, and that your source of information is biased. Let
me get on with it ; let me answer one question at a time.
Mr. Halley. All right.
Mr. Rush. I say this : That when Governor Warren was nominated
that your local newspapers made a statement that they were going to
have him impeached before he was even in office. Naturally, these
local papers and the Tampa newspapei*s and the newspajDers over the
State didn't support him when he ran, and when they have not been
able to get anything on him they have been trying to get something
on his friends, and that is the reason that this whole crime commission
got started down here and got all of this investigation. Now, getting
back to your law there, you are a lawyer
Mr. Halley. Let's stay on tliis for just a moment.
Mr. Rush. All right.'
394 lORGANIZED OREVEE IN INTERSTATE COMMERCE
Mr. Halley, You say that the policy of this committee is to have
leads and that we are getting leads from people ?
Mr. Rush. Yes.
Mr. Halley. As the result of these leads you have heard certain
witnesses take an oath and swear to certain facts before this com-
mittee ?
Mr. EusH. Yes.
Mr. Haluey. And you have heard some of that testimony ?
Mr. Rush. Yes.
Mr. Halley. And you have read about some of it in the newspapers ?
Mr. Rush. I haven't paid any attention to the newspapers.
Mr. Halley. You have heard some?
Mr. Rush. Yes.
Mr. Halley. And some of these facts relate to various things that
might be considered unlawful by some people?
Mr. Rush. That is right.
Mr. Halley. You say that we have been getting leads from the
people on the other side of the fence politically ?
Mr. Rush. I say this : I say that you have been getting leads from
the Miami Crime Commission down here and these local newspapers.
There is nothing that is said in here about anybody that the news-
papers don't have it, and if it is adverse to a party they have it before
you can turn around; if it is good, they don't get it.
Mr. Halley. Do you remember reading in the newspapers several
months ago, about 2 months ago, about the formation of this com-
mittee ?
Mr. Rush. Yes.
Mr. Halley. This Senate committee?
Mr. Rush. Yes.
Mr. Halley. And you read subsequently about the committee com-
ing to Florida to make certain investigations?
Mr. Rush. Yes.
Mr. Halley. Perhaps you can tell me why the people on the other
side of the fence politically — I don't know who they are, and I don't
know who you refer to, but I gather that they are some people that
we don't get leads from — why don't they get witnesses and produce
them ?
Mr. Rush. It is not leads.
Mr. Halley. Why hasn't your client answered the subpena of the
committee ?
Mr. Rush. I think it was read into the record this morning where
he said he would voluntarilv come before the committee.
Mr. Halley. The S. & G. Syndicate is not a corporation, is it; it is
a partnership, isn't it?
Mr. Rush. I don't represent the S. & G. Syndicate.
Mr. Halley. Wait a minute; you received a fee from the S. & G.
Syndicate, didn't you?
Mr. Rush. I received that for my association with Mr. Ben Cohen.
Mr. Halley. Who paid the fee?
Mr. Rush. Ben Cohen.
Mr. Halley. Whose check was it?
Mr. Rush. S. & G. Investment Co.
Mr. Halley. And that is a partnership, is it not?
Mr. Rush. I don't know.
ORGANIZED OREME IN ESTTERSTATE COMMERCE 395
Mr. Halley. You mean that you never investigate the source of a
$10,000 fee?
Mr. Rush. No, sir. I had nothing to do with the S. & G. Invest-
ment Co. ; I don't know who the members are, and it makes no differ-
ence to me so long as my fee is paid ; it is all right with me so long
as my fee is paid.
Mr. Halley. They are your clients, are they not?
Mr. Rush. When Mr. Cohen came by and talked to me about it, we
didn't discuss the S. & G. Investment Co.
Mr. Halley. I didn't ask you that. The S. & G. Syndicate is your
client; they paid your fee?
Mr. Rush. I wouldn't say the S. & G. Investment Co. was my client.
Ben Cohen associated me in this matter as an attorney, and we didn't
discuss w^here the money was coming from at all.
Mr. Halley. You don't care where the money comes from just so
long as it is money?
Mr. Rush. I didn't say that, Mr. Halley.
Mr. Halley. Wliose client was the S. & G. ; is it Mr. Ben Cohen's
client ?
Mr. Rush. I presume so. He sent me a check of the S. & G. Invest-
ment Co.
Mr. Halley. Counsel, you know that you cannot represent thin
air. If you are associated with another lawyer, and if that lawyer
has a client, that client is your client, isn't it ; particularly when you
take money for it ?
Mr. Rush. If Mr. Cohen sent me that check for $10,000, it would
have been the same to me, because my association was with Mr.
Cohen. If he had sent me that check, it would have been just the
Same.
Mr. Halley. When a lawyer walks into your law office and asks you
to become associated in a case, doesn't he say who the client is, or do
you say, "TVHio do we represent, Brother Counsel," or don't you
care who the client is ?
ISIr. Rush. He came in and associated me in this matter to pre-
pare and collaborate in the drafting of a legislative bill, and the bill
was to legalize bookmaking, and he told me what the fee was, and
when he paid the fee it was with a check of the S. & G. Investment
Co. He could have been the S. & G. Investment Co. himself, for all
I know.
Mr. Hai-ley. He is in fact, isn't he ?
Mr. Rush. I don't know.
Mr. Halley. Part and parcel of it ?
Mr. Rush. I don't know.
Mr. Halley. You know very well that nobody pays $20,000 for
drafting a bill that has been drafted many times before and pro-
posed before the State legislature many times — a very simple thing —
nobody pays $20,000 for that, and you know that, don't you ?
Mr. Rush. I don't know that at all, Mr. Halley.
Mr. Halley. You would not be surprised to find out that they
expected you to do a little more than drafting that bill ?
Mr. Rush. We had an understanding as far as lobbying in the
legislature was concerned; I had nothing to do with the lobbying.
Mr. Halley. Was there some reason why you didn't want to lobby
it in the legislature ?
396 iORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Rush. Yes.
Mr, Halley. ^\^iat was the reason ?
Mr. Rush. Because I represented dog tracks in the legislature and
I thought there would be a conflict of interest.
Mr. Halley. But you were willing to take the fee for drafting the
bill?
Mr. Rush. Yes.
Mr. Halley. Wasn't there a conflict of interest anyway ?
Mr. Rush. No.
Mr. Halley. If the dog tracks were opposed to the bill, would
it be right for you to take a fee for drafting it ?
Mr. Rush. I saw no objection in the taking of it. I think it is a
matter of my opinion as to whether or not it was in conflict.
Mr. Halley. Did you tell Bill Johnston about it?
Mr. Rush. I don't believe I ever discussed it with him.
Mr. Halley. Let's get back to this other thing. Ben Cohen's client
was the S. & G. Syndicate. Somebody was to be the client in the case.
Lawyers like to have clients, because clients pay the bill.
Mr. Rush. As far as that is concerned, I don't know — I didn't know
who was going to pay the bill.
Mr. Halley. Wlien it was finally paid you found that it was paid
by the S. & G. Syndicate ?
Mr. Rush. S. & G. Investment Co.
Mr. Halley. You are a lawyer and you were able to go down to
the Miami Beach City Hall and look up who was paying your bills.
Mr. Rush. I didn't go to the city hall to investigate that.
Mr. Halley. I am still trying to find out why the political people
on the S. & G. side of this thing, if it is politics, are not here in answer
to the committee's subpena, why they have not come in and given the
facts on the other side. They have been notified to come in and give
the facts, and that invitation has been extended to them through the
newspapers and over the radio, and yet you sit there and tell the
committee that it is taking things from only one side of the fence.
Where are your clients ?
Mr. Rush. I have never said that the S. & G. are my clients.
Mr. Halley. Who are the people who paid you the $10,000 ?
Mr. Rush. About the politics. As I said, I mentioned nothing about
politics with the S. & G. Syndicate. I said that the politics were on
the other side of Governor Warren and William Johnston. They
are the ones that we were talking about at the time, and then you
injected here this S. & G.
Mr. Halley. They have something to do with what the committee
is down here to investigate, don't j-ou think?
Mr. Rush. Wlio?
Mr. Halley. The S. & G. Syndicate.
Mr. Rush. It looks to me like the committee is investigating the
Governor, from what came up last night.
Mr. Halley. Is that your conclusion ?
Mr. Rush. Yes.
Mr. Halley. Do you know John Patton ?
Mr. Rush. Yes. *
Mr. Halley. Who is he?
Mr. Rush. Who is Mr. Patton ?
ORGANIZED ORIME IN INTERSTATE COMMERCE 397
Mr. Halley. Yes.
Mr. Rush. What do yon mean by "Who is he?"?
Mr. Halley. What is his business?
Mr. Rush. I think Mr. Patten is very much retired; he has some
position with the Miami Beach Kennel Chib. I don't know exactly
what it is.
Mr. Halley. That is the kennel clnb of which William Johnston is
president ; is that right ?
Mr. Rush. One of them.
Mr. HalulY. Does he also have a position with the Jacksonville
Kennel Clnb?
Mr. Rush. I don't know that. Not that I know of. Do you mean
Mr. Johnston or Mr. Patton ?
Mr. Halley. Patton.
JNIr. Rush. No, sir; Mr. Patton's son does.
■ Mr. Halli:y. What job does Mr. Patton's son have?
' Mr. Rush. Mr. Patton's son, I believe, is the manager of it.
Mr. Halley. Does Mr. Patton's son also have a job with the Orange
Park Kennel Club?
Mr. Rush. Yes.
• Mr. Halley. Is Mr. Patton associated with the Sportsman's Park
race track in Chicago?
Mr. Rush. I couldn't answer that. I have seen him there, but I
don't know whether he is associated with it or not.
Mr. Halley. You know that Mr. Johnston is president of it ?
Mr. Rush. Yes.
Mr. Halley. Did you know Edward H. O'Hare ?
Mr. Rush. No.
Mr. Halley. Do you know who he was ?
Mr. Rush. I have heard of him.
Mr. Halley. He was formerly president of Sportsman's Park race
track, wasn't he?
I Mr. Rush. That I couldn't answer.
™ Mr. Halley. You know he was murdered in a gang murder a few
years ago?
y Mr. Rush. I read about it in the papers ; yes.
H Mr. Halley. Did you ever talk about that with either William
; Johnston or John Patton?
Mr. Rush. Yes; but not to any great extent. I have talked to Mr.
Johnston about
Mr. Halley. The events immediately preceding that murder were
] the type of events that a man would talk to his lawyer about, were
they?
Mr. Rush. We had no talk about any events immediately preced-
ing it.
Mr. Halley. Did Mr. Johnston ever tell you that immediately before
the nuu'der of O'Hare that he and Patton were with O'Hare at Sports-
man's Park track?
Mr. Rush. I don't think that he said anything about Patton being
there; he said that he just left Sportsman's Park, but he didn't talk to
him.
Mr. Halley. Patton was there, too, wasn't he ?
Mr. Rush. I don't know. I wasn't there.
398 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley, In fact didn't Johnston say that as O'Hare left he
was cleaning a gun and put the gun in his pocket?
Mr. Rush. Well, Mr. Halley, I would like to answer all of your
questions, but I don't see where any of that comes within the scope of
this investigation.
Mr. Halley. I will ask you to answer, in any event.
Mr. Rush. Johnston never told me that. I read about that in some
magazine or newspaper, but Johnston never told me that.
Mr. Halley. Do you know Harry Russell ?
Mr. Rush. Yes.
Mr. Halley. How long have you known him ?
Mr. Rush. Oh, about a year and a half or two years, I would say.
Mr. Halley. Who introduced you to Harry Russell?
Mr. Rush. I couldn't say ; I don't know.
Mr. Halley. He is a friend of William Johnston's too, isn't he?
Mr. Rush. I don't know that he is a friend of William Johnston's ;
I think he is an acquaintance of William Johnston. I think they are
acquainted.
Mr. Halley. Did you ever receive a fee from Harry Russell ?
Mr. Rush. No.
Mr. Halley. Had he not just become a member of the S. & G. Syndi-
cate when you got your fee from the S. & G. Syndicate?
Mr. Rush. I couldn't answer that. I don't know.
Mr. Halley. Didn't you ever hear of Harry Russell becoming a
member of the S. & G. Syndicate?
Mr. Rush, Yes.
Mr. Halley. Who told you that?
Mr. Rush. I think I read it in a paper down here.
Mr. Halley. Did you ever see Russell and Johnston together in
Chicago ?
Mr. Rush. In Chicago ?
Mr. Halley. Yes.
Mr. Rush. Not in Chicago.
Mr. Halley. Did you ever see them together any place else?
Mr. Rush. I have seen them together in Florida ; yes.
Mr. Halley. Does Johnston make his headquarters at the Black-
stone Hotel in Chicago ?
Mr. Rush. He always stays at the Blackstone Hotel in Chicago
and he has stayed there up until this time,
Mr. Halley. Would it surprise you to know that Harry Russell
was in the Blackstone Hotel just a few days in the last couple weeks?
Mr, Rush, I don't know that at all,
Mr. Halley, And that he makes the Blackstone Hotel his head-
quarters, too?
Mr. Rush. The Blackstone Hotel is a pretty prominent and a good-
sized hotel, and it would not surprise me if he does. President Tru-
man stays there when he is in Chicago, because I have been there when
President Truman was staying there,
Mr, Halley, How long have you known Bing Crosby?
Mr, Rush. Well, I have known Bing, I would say, ever since he has
been on the Jacksonville police force; probably 6 or 8 years; and
maybe longer.
Mr. Halley. Did you know that he made a trip to Miami during
January of 1949 ?
'ORGANIZED ORIME IN INTERSTATE COMMERCE 399
Mr. Rush. I don't remember any particular time, but I know he
was down here.
Mr. Halley. Did you know that he has been designated by the
Governor as a special investigator?
Mr. Rush, Yes ; I understood that he was.
Mr. Halley. Did he ever tell you what happened when he came to
Miami for that investigation?
Mr. Rush. No.
Mr. Halley. Did he tell you that he had attempted to make some
investigations on the Beach, and that the chief of the sheriff's office
had complained to the Governor that he had no right to send any
investigator to Miami and had asked that he be taken off the job in
Miami ?
Mr. Rush. No, sir.
Mr. Halley. Did you know that C. V. Griffin was appointed to
investigate crime by the Governor ?
Mr. Rush. The first time I ever heard of it was when it was in the
paper.
Mr. Halley. You never discussed that with Johnston ?
Mr. Rush, No,
Mr, Halley. Did you hear the testimony yesterday to the effect
that the day after the appointment of Griffin was announced that
Johnston was seen in Tallahassee and that Griffin thought that John-
ston had gotten the Governor to call off the appointment and fire
him?
Mr. Rush. I heard that testimony, yes. I think Mr. Griffin first
jumped on Mr. Wolfson about it. That was the first release that he
made on it, and then he jumped on Johnston. I think Wolfson was
in Tallahassee on the day of the release.
Mr. Halley. Who is Bowers ; do you know him ?
Mr. Rush. Wliat Bowers is that?
Mr. Halley. George Bowers.
Mr. Rush. I know a George Bowers, yes.
Mr. Halley. What is his business ?
Mr. Rush. I don't know what he is doing at the i)resent time. He
is reputed to have been operating some gambling places.
Mr. Halley. Some gambling places ?
Mr. Rush. Casinos, or whatever you call them.
Mr. Halley. Where ?
Mr. Rush. In Miami Beach ; I mean Miami and Miami Beach.
Mr. Halley. Did you ever represent him ?
Mr. Rush. He has talked to me about representing him on some
^ matters, but I have never received a fee from him.
Mr. Halley. Did you ever receive a fee paid by anyone else in a
matter with which he was connected ?
Mr. Rush. No, sir.
Mr. Halley. Did you ever receive any moneys from him that
weren't a fee ?
Mr. Rush. No," sir.
Mr. Halley. Did you ever receive any moneys from George Bowers
in any connection whatsoever ?
Mr. Rush. No, sir.
Mr. Halley. Did you ever receive any moneys from "Bing" Crosby ?
400 lORGANIZED ORIME EST INTER'STATE COMMERCE
Mr. Rush. No, sir.
Mr. Halley. Do you know Avhat Crosby and Bowers were doinjr in
Miami together in January of 1949 ?
Mr. EusH. No, sir.
Mr. Halley. I don't believe you put all the books in evidence. I
think we stopped in the middle of the first book, ]\Ir. Rush.
Mr. RrsH. All right. On that I would like to know if it would
be satisfactory to the committee (I have had some photostatic copies
made of these pages of my books, and I think you have examined
them) to give you these photostatic copies, and let me take my books
back to the office.
Mr. Halley. I think we would like to keep them for just a few days
and we will return them next week.
The Chairman. Have photostats been made of all of them?
Mr. Halley. Of the pages that he deems relevant, and we got the
books after 11 o'clock last night.
Mr. Rush. Mr. Chairman, there are photostatic copies made of
everything pertaining to the subpenas, and these are books of the office,
of the partnership, and they are used every day, and I thought I was
doing the committee a favor by having the photostats made so that I
could take the books back to the office.
The Chairman. Mr. Rush, what time are you planning to go back
to Jacksonville ?
Mr. Rush. I w^ould like to take the first plane that gets out of here.
I would like to have gone back last night.
The Chairman. If you will put them in evidence we will see that
you get them back.
Mr. Rush. That is the reason I left them with you last night.
The Chairman. We didn't have an opportunity to check them.
Mr. Rush. I want to get them back as soon as possible because they
are in use every day.
The Chairman. We will see that you get them back before you start
back.
Mr. Halley. Either that or by Monday or Tuesday. We would like
to have time to check them.
Mr. Rush. There is an index in them, if you want to look at them,
to enable you to find anything you want.
The Chairman. Will you explain what the books are, Mr. Rush ?
Mr. Rush. These books — I'm not a bookkeeper. I can't tell you
exactly what they are, but they are the books of my law office, showing
the receipts and disbursements and the accounts of various clients,
and the ones that you have asked for are the ones that I have had mime-
ogra})lied or photostated, the whole sheets that you have asked for,
on the pages.
The Chairman. All right. They are all the same type of books ?
Mr. Rush. It seems that one of these books when something comes
in they put it on that, and then they transfer it onto another one some-
how. I'm no bookkeeper. This one that we were just talking about
seems to be — that is not the one that I am talking about. This seems
to be a book for 1949 showing moneys that came in the law office
of Rush & Pierce during the year 1949, and that was the one that wei
just testified about. And this book [indicating] seems to be worked
in conjunction with that, and it shows where the money comes in and
ORGANIZED CRIM'E' IN" INTERSTATE COMMENCE 401
that is put in this book [indicating], and then it's transferred into
Book Xo. 1, and entry made to the various accounts, and shows where
that was transferred over to that client's account. Tliat is the one
we were talking about in 1949, that had the S. & G. Investment Co. in
it. That is the only thing relevant in 1949, 1 believe.
Mr. Halley. Do you have some documents there, as well, that you
want to present to the committee?
Mr. Rush. I have these 1950 books if you want to go into them at
this time, or we can go on with the documents of the S. & G. Invest-
ment Co.
Mr. Halley. As you please.
Mr. Rush. As I have just stated, on the S. & G. Investment Co. that
fee w^as in connection with — and I brought this file down — Sam Cohen.
This is not the original file in this case of Sam Cohen. The original
file in that case was delivered to Mr. Cohen either during the 1949
session of the legislature or just before. Those are margin end papers
that for some reason were not in the original file, and my secretary
made an additional file and just dropped those in it.
That shows, I think, in there somewhere; I had gotten some in-
formation from Illinois and California and around in the preparation
of that bill.
Now, in 1950 — the statement I made just a few minutes ago — I don't
recall just what it was about — about George Bowers giving me any
money on or for or on behalf of somebody, and so forth. It may be
I was thinking about one thing and not another there, because in this
it has come out and I have been more or less accused of getting money
illegally or, you might say, under the table, and that is what I was
thinking about when the question was asked.
Now. Mr. George Bowers in 1950 did deliver to me a check on one
of these things that you have asked for, subpenaed on. I just want
to make it clear that when I said I had received nothing from him
that that is what I had in mind. I thought we w^eren't talking about
anything that was illegal.
The Chairman. What was it on, Mr. Rush ?
Mr. Rush. On this particular one it is the Sunny Isles, Island Club,
or whatever it is in that subpena.
Mr. Halley. Sunny Isles Casino, I believe it is called.
Mr. Rush. Sunny Isles Casino. I received a check for $1,000, as
sfeown here, from the Sunny Isles Club. It doesn't exactly comply
with the subpena. I assumed that that is Avhat you were talking
about, so I brought this in, and I have no intention of trying to evade
any information because of any technicality.
The Chairman. What was that fee for, Mr. Rush?
Mr. Rush. That was a retainer fee that Mr. Bowers gave me, from
the Sunny Isles Club in 1950, this year. I received $2,000 from him,
and $1,000 was paid on January the 7th, and the other thousand was
paid on January the 25th.
Mr. Halley. The second thousand?
Mr. Rush. Yes, sir.
Mr. Halley. On Sunny Isles?
Mr. Rush. Yes, sir.
Mr. Halley. On the page you are looking at now have you had that
page photostated ?
402 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr, Rush. (No response.)
Mr. Halley. It might do me some good to look through those books.
At least I would have found that page.
Mr. Rush. I thought I was helping the committee
Mr. Halley. I thought it was just an oversight.
Mr. Rush. I have no intention of hiding anything in the books.
Mr. Halley. The Sunny Isles is a gambling club, isn't it?
Mr. Rush. I have never been in it.
Ml'- Halley. What did you do with your two thousand?
Mr. Rush. That was a retainer fee from him.
Mr. Halley. You mean you have taken a retainer fee from a paix-
nership and you don't know what the business is ?
Mr. Rush. I know what it is supposed to be. I don't know of my
own knowledge.
Mr. Halley. You say of your own knowledge; has anybody told
you that it was a gambling club ?
Mr. Rush. Yes, sir.
Mr. Halley. Wlio told you ?
Mr. Rush. Well, it has been in the papers, and it is generally known
that that is what it is.
Mr. Halley. Is it your position that there are some things you just
don't want to know ; is that the point ?
Mr. Rush. No.
Mr. Halley. Don't you ask your clients what business they are in
when you take a retainer from them ?
Mr. Rush. Yes ; I knew what business I was supposed to do for the
retainer fee.
Mr. Halley.' Who signed the check for you ?
Mr. Rush. What ?
Mr. Halley. Wlio signed the check for you ?
Mr. Rush. Who signed the check? That check was signed by Mr.
Bowers and Mr. Levitt.
Mr. Halley. By Bowers?
Mr. Rush. And Mr. Levitt.
Mr. Halley. That is the same Bowers I asked you about before,
isn't it?
Mr. Rush. I couldn't say. The only recollection I have as to who
signed the check on that is the notation in this book of Bowers and
Levitt. •
Mr. Halley. I thought I asked you sometime ago if you hadn't
been paid any money by Bowere.
Mr. Rush. Mr. Halley, I just got through explaining to the chair-
man of the committee here that what my thought was when you asked
that question. You were talking about moneys that I had gotten
from Crosby, and so forth, with the insinuation that I had gotten
moneys illegally, and that is what I was thinking about, and I corrected
that statement just a few minutes ago and explained it.
Mr. Halley. I didn't say you got moneys illegally from Bowers
and Levitt.
Mr. Rush. You have been insinuating as much.
Mr. PIalley. Has that been in your mind ?
Mr. Rush. There has been testimony here that insinuated it, and
I wanted to get it straight once and for all.
ORGANIZED CRIME: IN" ESTTE'RSTATE COMMERCE 403
Mr. Halley. Has that thought been traveling through your mind
during this testimony?
Mr. Rush. It most assuredly has, after what you brought up here
last niglit and all, and I want to get it straight that every cent I
got went through my books, and it was in the form of a check.
Mr. Hai.ley. And you thought that I wouldn't be interested in
anything that was in your books ^
Mr. Rush. Do you think for a moment that I would say I hadn't
gotten money when I brought the books up here shoAving that I had.
These were subpenaed.
Mr. Halley. You know very' well that Levitt was a partner in
the Sunny Isles Casino and that you took a fee from him.
Mr. Rush. Yes, I knew he was a partner.
Mr. Halley. And which Levitt was that, Jules Levitt or Leo
Levitt?
Mr. Rush. I don't know. I have never met them.
]\Ir. Halley. Do you personally own an interest in any gambling
establishment in the State of Florida ?
Mr. Rush. No, sir.
Mr. Halley. Did you ever hear of the 21 Club at Jacksonville
Beach ?
Mr. Rush. Yes, sir.
Mr. Halley. Is that in the State of Florida ?
Mr. Rush. Yes, sir.
Mr. Halley. Is it a gambling club ?
Mr. Rush. I couldn't say.
Mr. Halley. Do you own any interest in the 21 Club ?
Mr. Rush. No, sir.
Mr. Halley. Do you kjiow a man named George B. MacDonnell ?
Mr. Rush. Yes, sir.
Mr. Halley. How long have you known Mr. MacDonnell?
Mr. Rush. I would say since about 19 — I don't know the exact date —
probably 15 years or more.
Mr. Halley. And doesn't Mr. MacDonnell own at least a percentage
of the 21 Club at Jacksonville Beach ?
Mr. Rush. I couldn't answer that.
Mr. Halley. Did you ever hear Mr. MacDonnell testify under oath
that he owned a percentage of the 21 Club at Jacksonville Beach?
Mr. Rush. Yes, sir.
Mr. Halley. Were you present wiien he so testified ?
Mr. Rush. I was present; yes, sir.
Mr. Halley. In fact, you were representing him as his counsel,
were you not?
Mr. Rush. Yes, sir.
Mr. Halley. And didn't he testify at that time that he owned a
portion of the 21 Club at Jacksonville Beach?
Mr. Rush. Yes, sir.
Mr. Halley. And didn't he testify that you owned a portion of it?
By you I mean Mr. Rush, the witness here.
Mr. Rush. That case and testimony has been some time back. At
the present time I don't think Mr. MacDonnell has any interest in
there at the present time.
Mr. Halley. Are you in it still ?
404 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr, Rush. No, sir,
Mr. Halley. Were you in it ?
Mr. Rush. Back some years ago ; yes, sir.
Mr. Halley. How many years ago ?
Mr. Rush. It lias been 2 or 3 years ago,
Mr. Halley. It couldn't be that long, could it?
Mr. Rush. Yes, sir,
Mr. Halley. Well, he only started operating there on November 1,
19^8.
Mr. Rush. I had no interest it in November 1, 1948.
Mr. Halley. Well, do you know the date of the testimony ?
ISIr. Rush, No, sir ; I don't recall the date of it.
jSIr. Halley. Well, the date is November 23, 1948, and let us both
quit beating around the bush. It was testimony and proceedings be-
fore Judge Claude Ogilvie, in room 310, Duval County Courthouse,
in Jacksonville, Fla. The record shows that you were there as the
attorney for Mr. George B. MacDonnell,
Mr, Rush. That's right.
Mr. Halley. And that in your presence and after an objection on
legal grounds by you
Mr. Rush. Mr.' Halley-
Mr. Halley. ]May I please finish? He testified that John A. Rush
was a partner in the ownership of that club which he had operated for
some time. Is that correct?
Mr. Rush. I think if you will look at it you will see that that was in
discussed some records of some year before and not 1948 records, Mr.
Halley.
Mr. Halley. How long before had he been running the 21 Club ?
Mr. Rush. I think, if I'm not mistaken, those records that they
had up there were records for about 1947. I think it was 1947.
Mr. Halley. 1947 ? Just 1 year previous ?
Mr. Rush. That is my recollection.
Mr. Halley. I will accept that. Now, he said that you were his
partner in that 21 Club ; is that right ?
Mr. Rush. He said that I receive money out of it. I don't recall
him saying I was a partner. He may have. I don't know.
Mr. Halley. If he did, if it shows here, would that be correct ?
Mr. Rush. I would assume so.
Mr. Halley (reading) :
Question. What was your ownership in that?
Answer. Partner.
Question. With whom?
There was an objection to the question, and some colloquy over the
objection. And the answer was given : "John A. Rush." Is that
right?
Mr. Rush. That's right.
Another statement of the witness was :
R. J. MaoDonnell receives 15 percent ; R. D. Askew receives 10 percent ; T. P.
O'Neill receives ."> percent of the bolita game or bolita earnings, you might say.
Wluit was the bolita game at that ]dace?
Mr. RusiL T think, if you will allow me to say, it had nothing to do
with interstate iramblino;. There is a boardwalk a( Jacksonville*
ORGANIZED CRIM'E' IN INTERSTATE COMMERCE 405
Beach and that bolita is an arrow that spins around on the boardwalk,
and that has nothing to do with interstate gambling.
I know when they came up there and got that information and
political enemies gave it all, and it was purely and simply just for
embarrassment. It has nothing to do with interstate crime or any-
thing; it's just boardwalk stutf.
It's just like this mermaid here; it's a boardwalk operation. It's a
boardwalk operation at Jacksonville Beach.
Mr. Halley. Is it your point that your client was your political
enemy
Mr. Rush. No, sir. I didn't say my client was.
Mr. Halley. Listen to your client's testimony, and say whether
you think it is true or not. [Reading.]
Question. The 21 Club
Mr. Rush. Mr. Halley, I told you that I had received the money
that was stated in there and had an interest in it. I explained to you
that it had nothing whatsoever to do with interstate conunerce; that
that operation down there is a local operation, a local affair, on the
ocean front. It's a beach thing there.
I admit that I had part of that, and I don't see why you should
take up all this time here in going into it. Of course, I will sit here
all day if you want me to.
Mr. Halley. Your speech forces me to say that I think it has to
do with your credibility, Mr. Rush. Would you state whether these
questions and answers represent the testimony in question ? [Reading :]
Question. The 21 Club is located at the beach?
Answer. That's right, Jacksonville Beach, Third Avenue and the Boardwalk.
Question. What is it?
Answer. What?
Question. I mean, what does the club do; what kind of business?
Answer. It's strictly a gambling club.
Question. No eating or anything or restaurant?
Answer. No ; it has no eating up there.
Questitm. And you operate that as a partner until November 1?
Answer. We closed it approximately — yes, I would say November 1, or until.
October 31.
Is that testimony correct?
Mr. Rush. I'm
The Chairman. Did it have a wire service in it?
Mr. Rush. No, sir; no, sir, it had no wire service in it, and, as I
said, that up there. Senator, is an arrow. You know what I mean ;
these arrow games and that kind of stuff; boardwalk stuff; strictly
local; no wire service or anything.
It was just purely and simply to embarrass me.
The Chairman. Well, Mr. Rush, I don't think that is true. Of
course, the purpose of our inquiry is to see what the connection is
between people in one State with people in another State in these
gambling operations. As to the matter of that affecting interstate
commerce, that is a rather broad definition, as you know.
Mr. Rush. It gets broader every year.
The Chairman. I su])pose you have a good amount of money that
is involved in any club of this sort, so when you get right down to it,
it is pretty difficult to get away from some interstate commerce con-
nection in almost any kind of operation, as you very well know.
406 ORGANIZED CRIIME IN INTERSTATE COOVEMERCE
Mr. Rush. The only kind of an interstate commerce comiection
would be for somebody to come to the beach and play a game down
there.
The Chairman. Well, there were probably checks cleared on banks
outside of there.
Mr. KusH, I wouldn't know anything about that.
The Chairman. Of course you wouldn't know, but that is the normal
operation.
Mr. Halley. In fact, hasn't Mr. iSIacDonnell taken his operations
to another State since then ?
Mr. Rush. No, sir.
Mr. Halley. Isn't he at Las Vegas, Nev. ?
Mr. Rush. Not to my knowledge. He wasn't last week.
Mr. Halley. Where was he last week ?
Mr. Rush. Jacksonville Beach.
Mr. Halley. Did you ever call him on the telephone at Las Vegas ?
Mr. Rush. Yes, sir.
Mr. Halley, Didn't he operate out there ?
Mr. Rush. Not to my knowledge. Do you want to know why he
was in Las Vegas ?
Mr. Halley. Go ahead and tell us.
Mr. Rush. He went out there to get a divorce from his wife. He is
at Jacksonville Beach, running the Mermaid, which is the Mermaid,
Inc., and it's a corporation down there and has a bar and restaurant
and boardwalk games.
Mr. Halley. Are you a partner in the Shore Club at Miami?
Mr. Rush. No, sir. I never heard of the Shore Club at Miami.
Mr. Halley. Have you any other books and records ?
(No response.)
The Chairman. Mr. Rush, just as a matter of curiosity, what is
the difference in tlie waiting period in Nevada and in Florida in
divorce proceedings? I wonder why anyone goes to Nevada from
Florida.
. Mr. Rush. That is something I couldn't tell you, except that he
didn't go on my advice, and I didn't know where he was. In this
whole thing he was behind on a separate maintenance and alimony
arrangement, and he was so far behind that until he could be heard
in the courts here he would have to pay up, and so he wasn't able to
pay up, so he went out there and stayed his prescribed time so he
could be heard by the court. That would be my assumption.
The Chairman, I think that sounds liice a very good excuse, any-
way.
Mr. Rush. Now, ISIr. Halley, when I turn these papers over to you,
the only other file now is
The Chairman. We don't need any file here; it is just a suuuuary
of the bill that you drafted. [Document returned to Mr. Rush.]
Mr. Rush. Now, on the Mermaid, Inc., liere is a hie on that. It's
a corporation that was formed in 194(), and I have one-third of the
stock in it, and the papers there comprise leases and all in comiection
with that corporation, and I own a third of the stock in it, and I
have never known of anything illegal in there. There is a tavern
running in the building in there, and I sui)pose somebody wanted to
embarrass me because I had stock in the tavern, too.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 407
Mr. Halley. Nobodv has started embarrassing you because of that,
have they?
Mr. Rush. I don't know why tliey would want this file. I'm not
blaming you, Mr. Halley. I'm not accusing you or the committee.
I think the committee is acting in the utmost faith but I say that
the people giving you the information are giving you information,
seeking to — I don't think they want to embarrass me. I think they
want to embarrass the Government.
Mr. Halley. Why haven't your friends volunteered to come here
and testify?
I Mr. Rush. There is nothing that my friends could say to aid in it.
' Mr. Halley. Where is Mr. Johnston?
Mr. Rush. Mr. Johnston ? I think you know where he- is as well as I
do. You heard the testimony here yesterday.
The Chairman. What is the Mermaid, Inc.?
Mr. Rush. That is a successor to the Beach Hotel.
The Chairman. The Beach Hotel ?
Mr. Rush. Yes, sir ; and the Beach Hotel was a hotel up above and
it was stores below, and it was located on the boardwalk there with
these concessions and games, and it's where the 21 Club was located
in there, and that burned, and when they rebuilt it they built a one-
story building, and in that building is a restaurant that is leased out,
and this bar and these boardwalk games up there are leased out.
The Chairman. That is the place where the 21 Club was formerly
located ?
Mr. Rush. Where it was formerly located. It is not located there
now, sir.
Mr. Halley. Do you have any other records ?
Mr. Rush. No, sir. That is all.
The Chairman. Thank you very much, Mr. Rush.
TESTIMONY OF PHIL E. SHORT, LIEUTENANT, POLICE
DEPARTMENT, MIAMI BEACH, FLA.
The Chairman. Mr. Short, do you solemnly swear that the testi-
mony you will give this committee will be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Short. I do.
Mr. Halley. What is your occupation ?
Mr. Short. I am a lieutenant of police, Miami Beach, Fla.
Mr. Halley. Were you ever chief of police ?
Mr. Short. Yes, sir ; 2 years.
Mr. Halley. How long have you been a lieutenant ?
Mr. Short. About 10 years, except for the 2 years I was chief.
Mr. Halley. When were you chief of police ?
Mr. Short. June, 1947, to July, 1949.
Mr. Halley. You have appeared here voluntarily pursuant to a
telephone call to your home in North Carolina ?
Mr. Short. Yes, sir.
Mr. Halley. You have a home in North Carolina ?
Mr. Short. Yes. I have a cabin.
Mr. Halley. Have you had an opportunity to review certain testi-
mony given by Melvin Richard ?
68958 — 50 — pt. 1 27
408 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Short. Off and on, I have read a lot of it ; yes.
Mr. Halley. I mean, given here before this committee.
Mr. Short. No, sir ; I wasn't here.
Mr. Halley. Has anybody advised you that he gave certain testi-
mony concerning a telephone conversation he had with you?
Mr. Short. I understand he had some sort of wire-recording that
was used here. I don't know what it was about.
Mr. Halley. You made no elf ort to find out what it was about ?
Mr. Short. No, sir.
Mr. Halley. Mr. Richard testified that he asked you about certain
gambling and arrests, or lack of arrests, at Miami Beach. Let me
read a portion of his testimony, of this record, and I will ask you
whether you can state whether you did say these things to Mr.
Richard [reading] :
Voice. How come an arrest wasn't made on that occasion 3 years ago?
I think he is talking about the Club Collins, and you are supposed
to have said :
Well, I don't remember right now. They was playing what they called short
cards, which was permissible at that time. I went in there because I under-
stood there was a crap game running in there, and all that they were playing
was short cards, and short cards at that time was permissible.
Then Richard says :
What do you mean, "permissible"? Somebody said it was O. K.?
Voice. Well, they had an O. K. from somebody ; yes. I don't know who from,
but I was told not to, not to intefere with short card games.
Mr. Richard says:
Were you chief then?
And your answer was :
No, no ; that was before — before that time.
Mr. Richard said:
Who would give you orders like that? Where would you get them from?
Your answer:
Chief of police.
Mr. Richard. You don't know who he got them from?
Answer :
No, I don't.
Mr. Richard. Well, when you were chief who gave you orders about what
should and shouldn't be done — what could operate.
Your answer was:
Melvin, I don't want to get involved here and get somebody in trouble now.
Mr. Richard. Well, I'm trying to get to the bottom of this, and I have been
trying for a long time, and I don't care much who gets in trouble, as long as it's
on the level. I don't want to do anything dishonest.
Your answer:
Well, it always
Mr. RicnARU. I mean, I didn't call you up for the purpose or with the intentiou
of having this conversation with you that led into this. I would like to sit
down with you and discuss it with you at length.
ORGANIZED CRIME: IN INTEHSTATE COMMERCE 409
Your answer:
Well, anytime you're ready.
Mr. IlicHAKD. But I would like to know from you, if you can tell mo, who
was it that gave you orders when you were chief? Somebody gave you orders,
about who was to operate and who wasn't to operate and when they were to
operate and when they weren't.
You are supposed to have said :
Well, as a rule it was Mr. Renshaw that they charged they interfered with
the hotels, and so forth, and were playing short cards and playing for the enter-
tainment of the guests and let the guests play cards in the hotel lobbies, and,
and I usually took my orders from him.
Mr. Richards. How about bookmaking?
Answer :
Melvin, I would rather talk to you sometime when we're not on the telephone
about that.
And then you are supposed to have made an appointment with him
for hnich the next day.
Mr. Hallet. Do you recall that telephone conversation?
Mr. Short. Yes, sir.
Mr. Halley. And is that transcript that was just read here
accurate ?
Mr. Short. That is correct.
Mr. Halley. Is there anything that you would like to say about it ?
Mr. Short. Well, I can't elaborate on it.
Mr. Halley. Did you see Mr. Richard the next day ?
Mr. Short. I met him up in the office at his request; yes, sir.
Mr. Halley. And did you then talk about being told to lay off
going after gambling on that occasion?
Mr. Short. I never was given any orders about gambling.
Mr. Halley. You were never given any orders about the gambling ?
Mr. Short. No, sir.
Mr. Halley. Let me read this conversation to you. This is a wire
recording that he made and he stated that it wasn't too audible, but
here he states his recollection of the conversation :
I recall that I asked Phil Short whether it was possible to close down the
city of Miami Beach without any difficulty, and he said there would be no
difficulty at all, that the chief of police could close the town in a matter of
hours. And I apked him if that was so, why he had never closed it down during
the time he was chief. He said while he was chief of police he closed it down
on two occasions.
I asked him what the occasions were. He said that one was authorized and
one was unauthorized.
I asked him if he would tell me what these occasions were. He said he
closed the town immediately after he got into office, and he was immediately
advised by higher-ups to lay off.
He indicated that it was the city manager who called him and told him that
he didn't want the chief of police engaged in those activities. He said that
he subsequently closed the town again on orders from the city manager.
I asked him how it was possible for him to close the town on that occasion,
exactly what did he do.
He said he called Detective Pat Perdue, "The One-Man Bookie Detail," of
the vice squad, and he told Pat Perdue to go out and close it down, and he
closed it down in a matter of hours.
I asked him how it was possible for Pat Perdue to accomplish that, and he
said all he had to do was to go out and tell the boys that the heat was on and
they closed up.
410 ORGANIZED CRIME' IN" INTERSTATE COMMERCE
I asked Mm how come be thinks that Chief Simpson hasn't been able to accom-
plish the job, that he has told me time and again that they couldn't catch
these fellows, and why is it that Pat Perdue finds it so difficult catching people
in the hotels, in bookie establishments, when he was able to close the town,
and he said he was an honest cop when he was chief of police, and he knew
that he thinks that City Manager Kenshaw is also an honest city manager, but
in order to keep his job he realizes he must do whatever four councilmen tell
him to do.
We talked further about the Club Collins raid at some length. He gave
me a detailed report on it. I don't know if it would serve any useful purpose
to the committee if I gave you the report. I can tell you what happened in
that raid.
Mr. Short. He gave me a detailed report of the Collins raid. I
think that is the way it was.
Mr. Halley. I think that is all that is necessary to read now. Do
you recall that conversation?
Mr. Short. I had a conversation with him in his office and we
talked along those lines, yes, sir, but I don't remember the details of it.
Mr. Halley. Is there anything you would like to say about it or any
comment ?
Mr. Short. Mr. Halley, I can't tell you much about bookmaking.
Wlien I was inaugurated as chief of police I made up my mind I didn't
want to get involved w^ith anything pertaining to horse bookmaking.
I had nothing to do with it. I called Pat Perdue in and said, "You
understand what these fellows are doing, just carry on, I don't want
to know anything about the bookmaking or how they run it." I don't
know anything about it. The onl}'^ time I had anything to do with
books was at times something flagrant would happen and at times
like this I took action.
Mr. PIalley, I have no further questions.
The Chairman. Mr. Short, why didn't you want to know about
bookmaking, if you were chief of police? Wasn't that your job?
Mr. Short. I had been an officer for better than 20 years and I knew
what "hot potatoes" were.
The Chairman. What do you mean in these charges, this conver-
sation that you say :
Well, they was playing what they called short cards, which was permissible
at that time. I went in there because I understood there was a crap game
running in there, and all that they were playing was short cards, and short cards
at that time was permissible?
Well, what do you mean, "permissible"? Some body said it was O. K.?
Well, they had an O. K. from somebody ; yes. I don't know from whom, but I
was told not to, not to interfere with short card games.
Mr. Short. That is correct. That has always been understood over
there, that card games Avere permissible in the hotels. They never
have been interfered with.
The Chairman. How about gambling in general?
Mr. Short. There never has been any general gambling to my
knowledge in the last 7 or 8 years.
The Chairman. Well, it says here:
I asked him what these occasions were. He said he closed the town imme-
diately after he got into office, and he was immediately advised by higher-ups
to lay ofE.
Who was that that advised you?
Mr. Short. I don't remember at the time.
The Chairman. Well, did somebody advise you to lay off?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 411
Mr. Short. I never was advised to lay off. I was told not to be
quite so tight.
The Chairman. What was that again?
Mr. Short. I was told not to be quite so tight.
The Chairman. Who advised you that way ?
Mr. Short. Pat Perdue. I let Pat Perdue handle the entire booking
detail.
The Chair]max. In other words, when you closed up the town you
were advised not to be quite so tight ?
Mr. Short. Yes, sir.
The Chairman. In other words you were told to be more lenient?
Mr. Short. Yes, sir.
The Chairman. The liookies were not running openly? That is it,
isn't it, and that meant that you just lay off them?
Mr. Short. Yes ; it was on the sneak basis.
The Chairman. How about these open places ?
Mr. Short. None ran to my knowledge.
The Chairman. You never saw any ?
Mr. Short. I never was in a bookie joint only to make arrests.
Tlie Chairman. Only to make arrests ?
Mr. Short. That is all.
The Chairman. All right, Mr. Short.
Mr. Gips, did you have something that you wanted to tell us ?
Mr. GiPS. Yes, sir, I certainly have.
The Chairman. Mr. Gips, do you solemnly swear that the testimony
you will give this committee will be the whole truth and nothing but
the truth, so help you God?
Mr. Gips. I do.
TESTIMONY OF LEON GIPS, MIAMI BEACH, FLA.
Mr. Halley. What is your full name ?
Mr. Gips. Leon Gips, G-i-p-s.
Mr. Halley. And you live in Miami ?
Mr. Gips. Miami Beach for 26 years.
Mr. Halley. And there is something you want to tell this com-
mittee ?
Mr. Gips. I want to say something about Chief Short. When Chief
Short gave Pat Perdue an order to raid all of these places Chief Short
never sent for me. The chief himself, went out and made raids and
arrests and even including my place. He arrested me at my place
where I was working. Chief Short went in there where they were
E making books and Pat Perdue refused to go in there. He said he
wouldn't fool with it. Now why didn't he raid the Blackmoor which
was one of the worst places on Miami Beach? Chief Short had to
break in himself.
Mr. Halley. Wait just a minute.
Mr. Gips. Yes, sir. ■
Ij Mr. Halley. What is your business ?
' Mr. Gips. I was working in a casino as the director of a casino — -
the head man. I ran a while out at the Blackmoor but I was locked in
my room by the doctor. My wife and the kid and the doctor didn't
want to let me get out and testify. I left this morning at 9 o'clock. I
told my family that I was going to get a little walk for myself. The
412 ORGANIZED CRIME! IN INTERSTATE COMMERCE
doctor refused to send me here. He says, "You got to stay there." I
says, "I am rested."
The Chairisian. Mr. Gips, you take it easy now, with your testimony.
Mr. Gips. I was arrested 25 'years ago when Pat Perdue came into
my house. I am sorry I opened the door for him. My wife called me
and said for me to plpase come to the house, as somebody is walking
around in the building, and that she Avas afraid to be in the house.
"Come right home," she said. I was out of town, out of the city of
Miami Beach. I speeded home as fast as I could to be with my family,
and I got in a little automobile accident and I paid for the damage.
Mr. Halley. Try to gtick to the point because time is short.
Mr. Gips. When I walked into the house I saw Pat Perdue there.
The Chairman. Who is Pat Perdue 'i
Mr. Gips. I had about $60 in my pocket. He says, ""Wliat happened
to you? You come here." Well, he never found nothing else m my
pockets. He says, "I am going to search the house." I have there a
little craj) table that stood right in front of his eyes. He didn't find
anything after he checked the whole house to make a legal arrest, so
he just was about to leave when he OT)ened the door and saw a piece
of paper laying there from my office, and he says, "Let's go," and he
pulled the telephone out of my house, which was not in operation at
all, and I went over with Mr. Perdue to the police station. He said,
"Don't worry, Frenchy, there will be nothing to it; maybe 3 or 4
years." I asked him why he pulled my telephone out of my house.
He said it would be all right. For the last few years now, I have
found it necessary to have a phone in my house as I have a heart con-
dition. At 9 o'clock at night my telephone was returned to me. "Wliy
didn't that telephone stay there? Why did they return a new tele-
phone to my house? There is not a policeman in the United States
that will do what Pat Perdue did.
Mr. Halley. You say the phone was put back into your house ?
Mr. Gips. Yes.
The Chairman. A^^ien was that ?
Mr. Gips. The 13th of June.
The Chairman. Of this year?
Mr. Gips. This year, 1950, at 1 : 30 in the morning.
The Chairman. Now Mr. Gips, let me ask you one or two ques-
tions. We know you have a very bad physical condition and we don't
want to overtax yon.
Mr. Gips. I am full of medicine and I can talk, sir.
The Chairman. Your doctor refused to let you come here, and you
came anyway. Now let me ask you one or two questions.
Mr. Gips. Yes, sir.
The Chairman. You are known as Honest Frenchy, the honest
bookmaker ?
Mr. Gips. No bookmaker. I was only a clerk for the bookmakers.
The Chairman. Anyway, how long have you been operating casinos '
and bookies in Miami Beach ?
Mr. Gips. Since 1946.
Mr. Halley. Who have you worked for since that time ?
Mr. Gips. I was working in a restaurant on South Beach. And they^,
said, "Mr. Frenchy, you look like an honest man, do you want to work|
for us ?" I said that I didn't know what it was all about ; that I was in^
a restaurant business.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 413
The Chairman. Mr. Freiichy, -who do you work for as a book-
maker's clerk?
Mr. Gips. For Charles Friedman first. He gave me $2,500 in a
check to go buy a place of bookmaking, and I went over to the owner
and bought the place. The owner refused the check. He said that
that was against his rules to accept checks. He said I have to have
, the cash.
j The Chairman. Mr. Charles Friedman gave you a check for $2,000
' for you to -
Mr. GiPS. $2,500.
The Chairman. Go somewhere and open up a bookmaking estab-
lishment ?
j Mr. Gips. Yes, sir.
I! The Chairman. Where was it you went to ?
Mr. Gips. No. 100, on Twenty-first Street in the Sea Gull Cabana
] Club.
11 The Chairman. He w^ouldii't take the check?
' Mr. Gips. He refused to take the check. He told me to bring the
: cash for it, so I forged the check and cashed it and brought him the
i cash.
I The Chairman. How long did you work for Mr. Friedman, or
other people in the bookmaking business ?
Mr. Gips. Since 1037. Then Mr. Perdue came in in 1947 and threw
me out of that place.
The Chairman. Do j^ou mean from 1927
Mr. Gips. 1937.
The Chairman. Up to 1947?
Mr. Gips. I am sorry, sir, up to 1943. That is the first day I went
i!in the bookmaking business.
|i The Chairman. Do you know the S. & G. Syndicate?
\. Mr. Gips. There was no S. & G. Syndicate.
i, The Chairman. Wliat was
' Mr. Gips. Charles Friedman once worked for himself, and Jules
Levitt and Harold Salvey once worked for themselves. There was
no S. and G. Corp. ; no S. & G. Syndicate. They were working for
themselves.
The Chairman. Did you work for Levitt ?
Mr. Gips. Yes,
The Chairman. Who else did j^ou work for ?
]Mr. Gips. Charlie Friedman.
The Chairman. Is he the only one ?
; Mr. Gips. He is the only one. After they got incorporated it looks
like I worked for them all. I never can pay my rent after I finish
with them. I never have enough money to.
The Chairman. What do you mean, after they got into the corpo-
ration ?
Mr. Gips. When they got to call themselves the S. & G.
The Chairman. In the beginning they called themselves no par-
icular name like S. & G. In the beginning they were separate ?
Mr. Gips. Yes, sir ; everybody was for himself.
The Chairman. When did they get incorporated or form this S.
414 ORGANIZED CREME' IN INTERSTATE COMMERCE
Mr. Gips. I guess it was around 1942 or 1943. I may guess wrong.
Mr. Eddie Rosenbaum came in there and he was the only professional
crook in the S. & G. He gave money for false pretenses.
The Chairman. What do you mean ?
Mr. GiPS. Giving "ice money" and Eddie Rosenbaum and George
Rosenbaum, they muscled in and became the S. & G.
The Chairman. Where did Eddie and George Rosenbaum come
from ?
Mr. Gips. From Atlantic City, and the other one came from
Boston.
The Chairman. When?
Mr. GiPS. A year before I came; in 1925. They were operating
crooked booking and bingo games out on the beach. He was the
only one in that bingo racket.
The Chairman. What did you mean by the "ice money" ?
Mr, Gips. Eddie Rosenbaum cut in the business and said "It is
going to cost you $75 a week for operating." Plus you give him 50
percent for the cut, plus paying for the telephone. "And where am I
going to get the $75?" He said, "Out of your pocket." And I ran
back to Charlie Friedman and he helped me. He had helped me be-
fore. He says, "We are forgetting you ; we will leave you alone."
The Chairman. Do you mean in addition to the fact that you had
to give him 50 percent you had to put up $75 and give it to them?
Mr. GiPS. Yes. I had to give it to Eddie Rosenbaum.
The Chairman. What was that for?
Mr. Gips. That was supposed to be "ice."
The Chairman. What is "ice money" that you are talking about?
Mr. Gips. It is supposed to be the "ice," the "fix money," protec-
tion money. They charged me $50 a week extra for the service.
The Chairman. Now let's see. Was your contract as a bookie clerk
very much like that of all the others ?
Mr. Gips. No ; I never was working at all.
The Chairman. Well anyway, your contract was that you got 50 i
percent of the amount that was made ?
Mr. Gips. Yes, sir ; at the end of the month.
The Chairman. Then you had to pay $75 a week just for the privi
lege of operating?
Mr. Gips. No, sir ; I paid $50 a week for the privilege of operatingj
That goes on the sheet. That $75 a week is part of tlie "ice money.'*'
He says, "That is Avhat you will have to do." Wlio is the "iceman"?
I haven't seen him for 25 years.
The Chairman. Seventy-five dollars for "ice" and you never saw]
the "iceman" ; is that the idea ?
Mr. Gips. That is it.
The Chairman. Now who is the $50 for?
Mr. Gips. For the operating costs and the telephone.
The Chairman. That goes for the man you work for ?
Mr. Gips. For the corporation I work for. It is for the service of
the telephone and all kinds of expenses.
The Chairman. Does it go for lei2,al expenses or anvthing of tliabj
sort?
Mr. Gips. Your Honor, it can't be legal expenses when you world
as a bookmaker, I am sorry.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 415
The Chairman. Well, what I am gettinp^ at is, suppose you got in a
pinch or something ; who would pay your fine ?
Mr. Gips. That is Charles Friedman. He pays the expenses of the
place.
The Chairman. That is part of the expenses ? That is, the $50 ?
Mr. Gips. No, sir ; that costs $500 extra ; so much for the bondsmen ;
so much for the lawyer.
The Chairman. Did you have to pay that ?
Mr. Gips. No, sir. That all goes on the profits. I never had $50
to pay it. They all take it off the profits. That has nothing to do
with the "ice money." It has nothing to do with that $50 a w'eek we
paid anywav.
But it was the way Mr. Pat Perdue wanted to make arrests. He
calls up this place and says, "Send me out a man, I want to make an
arrest." So they come to French3^ He says he wants me to help
]iim for to find who is doing bookmaking down here. So I says, "Yes ;
I will find them for you." Now every time he made an arrest there
was a dismissal. I tell the truth and nothing but the truth. I gave
out for 2 years ; 2i/^ j^ears. I was with Pat Perdue in the automobile.
He was investigating and he would talk to them as if they were his
brothers. And when he took my college kid out of school and sent
nie to the hospital in 1947 and left the gangsters be dismissed, that
was it.
I have all these things to say if you want to listen — if you ask me
about it.
The Chairman. I know, Mr. Gips, you can have a very interesting
story, but that would take hours to tell.
Mr. Gips. Yes, sir. Here is my identification card I got when I got
arrested for speeding and overparking after 27 years here in Miami
Beach.
The Chairman. Now Mr. Gips, do you know where Pat Perdue gets
1 lis orders?
Mr. Gips. He never got any orders from nobody. He was taking his
orders from the people that he was getting — ^lie didn't get them from
the chief of police. AYlien the chief gave him orders he never made — ■ —
The Chairman. Now, Mr. Gips, I want to get into just how you
operated as a bookie clerk. Do you have some papers here with j^ou ?
Mr. Gips. Mj wife never gave it to me this morning. She never
knew that I went out of the house. Tliat is why I am not dressed. The
doctor said yesterday at 4 o'clock that if I went down here and testified
1 would drop dead. But I take a lot of medicine with me. My chauf-
feur is here and he has the medicine, and I drink it up and eat it up.
The Chairman. Don't exert yourself too much, Mr. Gips. Now let's
see about your operations. You had a sheet every day on which you
would list the bets you had made ?
Mr. Gips. Yes, sir ; and the ordinary little bets that would be divided
half and half between us.
The Chairman. Who were you working for? Would it be divided
up between you and the person you were working for ?
Mr. Gips. Yes, sir.
The Chairman. Now at the end of the month, when you had the
money, who did you take it to ?
Mr. Gips. I took the money every day.
The Chairman. Who did you take it to ?
416 ORGANIZED CRIMEI IN INTERSTATE COMMERCE
Mr. Gips. Eddie Eosenbaum. He was running the "society."
The Chairman. Then, after this thing got into a corporation, who
did you take it to then ?
Mr. Gips. The office where they got a sign there of S. & G.
The Chairman. They had a cUib there ?
Mr. Gips. Yes, sir. And when I lost I would go there to collect the
money to pay the customers.
The Chairman. And you got $50 a week there ?
Mr. GiPS. I paid that — was supposed to.
The Chairman. Did you pay it ?
Mr. Gips. I haven't paid it.
The Chairman. It would be on the sheets to be taken from your
amount ?
Mr. Gips. That is right, sir, from the total amount.
The Chairman. Then this other money, $75 a week was on the side?
Mr. Gips. That was under the table.
The Chairman. That went directly to somebody else from you ?
Mr. Gips. And Mr. Friedman stopped it. He says, "Frenchy is
not able to pay $75 a week ; he hasn't got that kind of business to pay ;
he is just an old-timer of Miami Beach, so he won't have to pay." oo
Mr. Friedman stopped it.
The Chairman, Now, there were some big bets that would get
above $200. What amounts would you handle ?
Mr. Gips. They would say, "$25 is enough for you; the rest they
take."
The Chairman. Any bets above $25 or some larger amount, if the
odds were greater, say, if the odds were 10 to 1 or 20 to 1 ?
Mr. Gips. That goes on the sheet.
The Chairman. What do you mean ?
Mr. Gips. They take it for themselves.
The Chairman. And this goes to the S. & G. office ?
Mr. Gips. Yes.
The Chairman. And Charles Friedman was the man before the
S. & G. was organized ?
Mr. Gips. Yes, sir.
The Chairman. Now, on this lay-off, these big bets, did all of that
money go to the office ; that is, you didn't get any part of the amount
that was laid off?
Mr. Gips. No, sir.
The Chairman. You didn't share 50-50 on the profits.
Mr. Gips. No, sir. If I had got 50-50, maybe I would own a home
instead of an apartment.
The Chairman. Was that lay-off (insofar as the amounts were con-
cerned) the amount that was very large as compared with the total
betting ?
Mr. Gips. They said, when there was a big bet, "Don't keep this
bet; you will go broke." They said I would go broke in 1 day if I
did it.
The Chairman. I just wanted to compare the amount that would
be laid off, in which you wouldn't participate in, with the amount
you did submit 50-50.
Mr. Gips. I never got 2 cents.
ORGANIZED CRIAI'E^ IN INTERSTATE COMME'RCE 417
The Chairman. Which was tlie larger amount, the lay-off amount,
or the amount you didn't have any part of ; or the bets that you got
a part of ?
Mr. Gips. The bigger amount is on the sheets that I got at the end
of the month. That is the bigger amount.
The Chairman. The amount, in other words, that you had on your
sheets would be bigger than the amount you would lay off with the
S.&G.?
Mr. Gips. That is right.
The Chairivian. What were the sizes of these amounts? What
would you do ; how much business would you do in a day or in a week
or month ?
Mr. Gips. It started off at $200 a day, $300, $600, $1,000, $2,000,
$3,000, in the season, and at the end of it I finished with just enough
to ]3ay m}^ rent.
The Chair:man. How much business would you do over a period of
a month?
Mr. Gips. In the suinmer you do $200, $300, or $400 a day ; and in
the wintertime we do $2,000 or $3,000 a day.
The Chairman. Well, at the end of the month, generally, what
would you get; how much?
Mr= Gips. I have a partner of my 50 percent of which I am not able
to work; he gets 25 percent and I get 25 percent, so of the 30 days
1 was behind for 2 months which I lost, and I can't get nothing for
2 months. I got to work the third month to make up what I lost for
the 2 months.
The Chairman. Well, on an average, how much would you make?
Mr. Gips. Three or four thousand dollars a year.
The Chairman. You make three or four thousand dollars a year?
Mr. Gips. Yes. and the other 50 percent was made by the corporation
over there.
The Chairman. Did you operate any casinos out in Hollywood at
one time?
Mr. Gips. No; just emplo3^ed.
The Chairman. Were you financial clerk in some of these places?
Mr. Gips. I was just the representative. They all know Mr. Frenchy
is in an honest place. I drove the people from Dade and Broward
Counties there to play. It is not crooked ; it is an honest place and
they come there
The Chairman. What place is that?
Mr. Gips. Next to the Hollywood Beach Hotel.
The Chairman. What is the name of it ?
Mr. Gips. Chris' Restaurant.
The Chairman. Is this in Broward County ?
Mr. Gips. Yes, sir.
The Chairman. That was an honest place ?
Mr. Gips. Honest place.
The Chairman. Do you know about the other places ?
Mr. Gips. No.
The Chairman. You didn't work in but one of them?
Mr. Gips. I worked a few years ago.
The Chairman. Well, in an honest place the customers still lose;
don't they ?
Mr. Gips. They can't win in any honest place either.
418 ORGANIZED CRIME' IN INTERSTATE COMMERCE
The Chairman. Who?
Mr, GiPS. The customers. They lose in either one.
Why shouldn't they lose? They are there from the choice of the
people. The class of people that I operate with is nothing but society
people. They come to play, not to win. When they lose $50 or $100
they say, "Thanks, Frenchy, we had a good time."
The Chairman. What was the other place out there ; do you know ?
Mr. GiPS. I do. The Greenacres was an honest place. That goes
on record. We know who is crooked. I do believe the Colonial Inn
was an honest place. I believe the Boheme was honest. I don't
work in any other places.
The Chairman. If you feel exhausted, you may stop testifying.
Mr. GiPS. No, sir. Senator; I feel just like I was just born.
Mr. Halley. You mentioned that when you were arrested your
telephone was pulled out by Perdue ?
Mr. GiPS. Yes, sir. Perdue gave it to a man, to Jack Farwell, and
Jack Farwell pulled it out.
Mr. Halley. And your telephone was put back, or another tele-
phone was put back in the same night?
Mr. GiPS. I was unconscious for 48 hours. I didn't open my eyes
for 48 hours later. My wife told me we got a new telephone, 5-5485,
and they called my family on that number.
Mr. Halley. Had you complained to anybody about your telephone
being pulled out, and said that you needed a new phone ?
Mr. Gips. I was unconscious. I was sick in the hospital and talked
to nobody.
Mr. Halley. How did the phone get back into your home?
Mr. GiPS. That Perdue must have telephoned a man to come out
and put one in. He must have flew back to my house.
The Chairman. Did he get back this night, or the next morning ?
Mr. Gips. The next morning with a new telephone. The old tele-
phone is confiscated and is at the police station. This is evidence of
Mr. Pat Perdue.
Mr. Halley. How did the S. & G. get its name?
Mr. GiPS. They call it the S. & G. just like they call me Frenchy.
Where the name came from I don't know. They were honorable
before they became the S. & G. The S. & G. used to work for me
selling odd items. Of course, it is now a big corporation. It is not
what it used to be.
The Chairman. When you say the S. & G. isn't what it used to be,
what do you mean?
Mr. Gips. They never used to say, "Give me, give me" like they do
now. Since Eddie Rosenbaum is there, he wants it all. An honest
Jew hasn't got a chance.
The Chairman. Do you know Mr. Harry Russell ?
Mr. GiPS. I don't know Mr. Russell.
The Chairman. You weren't working for him at that time?
Mr. Gips. I don't know. I never knew who he was. I know he was
working for Jules Levitt and Charles Friedman.
The Chairman. And you felt they treated you very nicely?
Mr. Gips, Very nice before they were the S. & G.
The Chairman. When did this policy cliange about Rosenbaum ?
Mr. Gips. He was going to show him how to make faster money.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 419
He AYas goino; to sliow them how to make 90 percent for the S. & G.
The Chairmax. Well, did the percentage change after he came m?
Mr. GiPS. I got $75 and $100 and $150 and $200 a week. That
changes things quite a bit if you ask me. An honest Je^y has gotno
chance there. The only chance I had was when I worked in the casino
there when I would make two and three hundred a week. I was very
happy there.
Mr. Halley. "Wliat did Perdue do; take over the gambling job?
Mr. GiPS. Sure, he Avas taking over. They put him back where he
belongs as a plain patrolman, and he was complaining to me why did
they do it. He said he was so honest for them people. He finally
fought with them and played politics and got his job back.
Mr. Halley. What people was he referring to that he was honest to ?
Mr. GiPs. The S. & G., sir.
Mr. Halley. You mean he was being honest to the S. & G. ?
Mr. GiPS. Not honest to the police department. They are missing
all these cases.
Mr. Halley. Did he get reinstated ?
Mr. GiPS. By the Honorable Vincent Giblin, one of the greatest
lawyers we got in Florida, in Dade County.
Mr. Halley. Did you ever see Perdue and Levitt together after
Perdue was reinstated?
Mr. Geps. I tell the truth and nothing but the truth, so help me
God. The truth is he came right back to the Sunny Isle as he wanted
to talk to the S. & G. And one of the S. & G. men come down and
says, "Get out of here, you bum. What are you doing here right in
front of my eyes ?" I was working in the Sunny Isle.
Mr. Halley. What happened when Perdue came into the Sunny
Isle?
Mr. Grps. He was kicked out.
Mr. Halley. What did Perdue say ?
Mr. Geps. He said, "Hello, Frenchy."
Mr. Halley. Then what happened ?
Mr. GiPS. The boss come down.
Mr. Halley. Who is the boss ?
Mr. GiPS. Jules Levitt.
Mr. Halley. Then what happened?
Mr. GiPS. He insulted Pat Perdue, and that was the end of it.
Mr. Halley. And Perdue left ?
Mr. GiPS. I think he went back on duty on the second floor. That
"happened in the restaurant when he was trying to walk upstairs. He
just left. I never saw him since.
^Ir. Halley. Did your bookie charge ever get cleared out ?
^Nlr. GiPS. He says "I don't know; you will have to wait 2 or '6
Dr 4: years before you can appeal on it."
j\Ir. Halley. When did you get out of the hospital the time that
^'ou were there after the trial ?
]Mr. GiPS. Your Honor, you are going to catch me in a lie. It was
I few days ago.
Mr. Halley. A few days ago ?
]\Ir. GiPS. Yes, sir.
Mr. Halley. What did he say ?
Mr. GiPS. He questioned me. "Why did you operate on the streets
iround here when Ave closed?"
420 ORGANIZED CRIME' IN INTERSTATE COMMERCE
"Why did you talk to Melvin Eicliard ?"
Melvin Richard was my friend. When I was in the hospital he
tried to help me on my illegal arrest. The reason I talked to Melvin
Kichard was so he could help me, because I have been around Miami
Beach 27 years and you arrested me illegal.
He said, "It don't take no legal evidence when I have a crap table
and dice and cards and the storage room in the closet.'' He pulled
out an old sheet and says, "Let's go." And he told Jack, but I was
not operating. I was out of the city limits. I was in Surfside. •
The Chairman. You are a roulette operator, Mr. Gips?
Mr. Gips. A roulette operator by profession, and I had managed
all of them casinos.
The Chairman. Have you worked at those casinos ?
Mr. Gips. A lot of them.
The Chairman. About how many would you say ?
Mr. Gips. Every one that was here.
The Chairman. Is that 5 or 6 or 10 ?
Mr. Gips. Only a handful of people — Charlie Thomas, Arthur
Childs, G. R. K. Carter, Sam Cohen, Ike Miller, Jules Levitt.
The Chairman. I was asking you the
Mr. Gips. That is the places.
The Chairman. The number of them. Those are the places you
worked at ?
Mr. Gips. Every one I mentioned is a different place — the Little
Palm Club, the 115 Club, the Island Club, Sunny Isles.
For the last 25 years I have been working in these casinos, wliich
I lost control here, and I had to get away from the hotel managing and
the procurement racketeers so I can' send one child through school.
The Chairman. Your son went to the University of Florida ?
Mr. Gips. He was in Gainesville.
The Chairman. All right, Mr. Gips. Will you sit down back here ?
Thank you very much.
TESTIMONY OF PAT PEEDTJE, VICE SQUAD, MIAMI BEACH, FLA.
The Chairman. Do you solemnly swear that the testimony you will
give the committee will be the whole truth and nothing but the truth,
so help you God ?
Mr. Perdue. I do; yes, sir.
Before I testify, after the subpena, I would like to have a chance to
answer all the accusations that Mr. Gips has given here and I would
like to elaborate on the whole situation from the time that I have
known him up until the present time.
The Chairman. Mr. Perdue, we want to give you a full chance to be
heard. I do want to call your attention to the fact that we are trying
to get through this afternoon and we have a number of witnesses, so
summarize as much as you can.
Mr. Perdue. First of all, I would like to say that Mr. Gips is a
character. I have known him as a character for years. He goes
around blowing his mouth off all the time about what he can do and
what he lias done and where he goes and how much money he has and
who his friends are, and so forth.
However, when he stated — what I meant to say and what I would
like to have this committee ask
ORGANIZED CRIME' IN INTERSTATE COMMERCE 421
The Chairman. You just nuike auy statement you want to make
preliminarily. You have heard his testimony, so you make any
explanation you want.
Mr. Perdue. In the mattter leading up to his arrest, I feel that he
perjured himself all the way around.
I have known the man for approximately 4 years. He has tried to
buy me for all these years and he even left some second-hand shirts in
my car in about 1948 when he was over at the Seagull Cabana Club.
He has never been able to give me a dollar and I have never gotten
intimate with him.
However, I have asked him for information on several occasions
and he gave me information.
The only time that he ever gave me information about any place
was at the Morton Apartments. A man took a customer away from
him and he was sore and he gave me the address of this particular
address and I raided it, and I did lose that particular case.
Now, Mr. Gips stated that he is known as "Frenchy." He is a
publicity-seeking fool and he likes to get his name in the papers
regardless of how he does it, and he goes around picking up wallets
and papers and gets his name in the papers, and this Frenchy
Mr. Halley. Can you elaborate on what 3^ou mean by picking up
wallets?
Mr. Perdue. It just seems that he finds wallets.
]\Ir. Halley. And he happens to find wallets that have a great deal
of money in them ?
^Ir. Perdue. It comes up every year.
Mr. Halley. And he seems to be able to return the money to its
rightful owner?
Mr. Perdue. It seems that way.
Mr. Halley. And he gets a small reward ?
He is shaking his head, saying he never got a reward.
Mr. Gips. Never accepted a reward.
Mr. Halley. Is there anything wrong in finding and returning a
wallet?
Mr. Perdue. I say that he goes through that channel in order to
get his name in the paper.
The Chairman. You don't mean that he would plant a wallet and
find it and turn the money over for publicity?
jNIr. Perdue. I am not saying anything about that. What I am
trying to build up to is this arrest, how it happened and the way it
happened.
^ For the past 4 or 5 months I have had orders to enforce the gam-
jbling laws and to the best of my knowledge I have done a good job.
]\Ir. Halley. For how many months ?
Mr. Perdue. The last 4 or 5.
jj Mr. Halley. What were your orders before the last 4 or 5 months ?
l| Mr. Perdue. It gets stronger all the time because of the newspapers
here and Melvin Kichard investigating every day. That naturally
puts the chief on the spot and I am on the spot and if we have to do
.a job, that is demanded of us. That is what it amounts to.
On this particular arrest, before the arrest, Frenchy Gips went
around to all the other bookmakers around Espanola Way and stated
to them that he was making book and they were a buiich of bums
422 ORGANIZED CRIME' IN INTERSTATE COMMERCE
because they couldn't make book. He felt that he had a license
because he knew Pat Perdue so well and was a good friend of his, and
any time they wanted to collect any bets, just come down to the police
station and they could collect them.
I heard about it and I couldn't believe it because Frenchy told me he
had an icebox over in Miami Springs with earmuffs and an overcoat
and I tried to find out where he was, and several of the other book-
makers said, "Why don't you do something about Frenchy?" and I
said, "He is in Miami Springs, as far as I know," and they said, "The
bum's working over here."
I didn't try to do too much about it for a couple of weeks, but
I sent an informant up to see Mr. Gips and he even wanted to give
him a job, said he was starting his own syndicate. I can produce
that witness. He is a lifeguard over at the Fourteenth Street station
on Miami Beach.
Now, in the conversation that I had with Gips at 1431 Washington
Avenue, where he used to serve cake and stuff in order to get people
up there to make dollar bets with him — we went and checked him on
several occasions and to my knowledge I think that he has this place.
I found out that he was working at 516 Fifteenth Street, and the
phone number at that place was 5-5485, and I had another line on him
at 5-5011 at 2340 Prairie Avenue, and one at 5-4538. I don't have
the address.
I checked all these addresses and then found out that he was work-
ing at 5-5484, and Detective Ferrell and I went through there on the
afternoon of the arrect, knocked on the door, and told him who we
were, and Mr. Gips came to the door and said, "Welcome, my friend,
walk right in and help yourself and look around."
So we walked in and — you talked to him about what he was talk-
ing about with me — and I told him that I wanted to know what he
had on his person, and he said. "I haven't got nothing," and I said,
"What have you got around the place?" and he said "Nothing. I
don't work around the house," so I looked right around, and I found
these 30-line sheets — run-down sheets that had been written on, and
there were bets, and I also found a record in a little desk wherein his
total earnings for the month of May was $1,354. That was his profit
for the month of May. I took that along as a record, and it is over
at the police station.
I didn't bring it with me because it is part of the evidence that is
supposed to go in his case.
On the way down, I knew that Frenchy had a bad heart, and I told
him, "Frenchy, don't get excited, because it is just an arrest. I don't
want to see you get yourself all upset and maybe have a heart attack."
I think that put the heart attack idea in his mind, and when he got
to the station he threw a heart attack, and the people have told me
since that time that if they ever get arrested they are going to throw
a " whingdinger." That is what they are going to throw. I don't know
what "whingdinger" means.
The Chairman. INIr. Perdue, in fairness to Mr. Gips, I have seen
the certificate of his doctor, and he did say that he had a very severe
heart attack.
Mr. Perdue. I believe that he does have a bad heart.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 423
The Chairman. On this occasion that you say he threw one, I think
we ought to be fair about it.
Mr. Perdue. I tliink we should, too.
The Chairman. The certificate shows he had a severe heart attack.
Mr. Perdue. It is very possible.
The Chairman. All right.
Mr. Perdue. I feel that he perjured himself beyond any scope. He
has told lies that are absolutely unfounded, and I would like to take
the time of this body, especially now, or some time in the future, to
reverse those accusations.
The Chairman. Let's take them u]) briefly one at a time. You have
talked about the arrest. How did the telephone get back in his house?
Mr. Perdue. That, sir, I don't know. I have no idea how the phone
got back in his house. However, I do know that the number is 5-5485,
and I did call the number about a week ago — 5-5485 — and his wife
answered the phone, and I know I got that same phone clown in the
police station.
The Chairman. You got the phone in his house and took it to the
police station, and the next morning or immediately thereafter another
phone got back in ?
Mr. Perdue. I can tell you my suspicions where it came from.
The Chairman. What are your suspicions?
Mr. Perdue. He has this place at 1431 Washington Avenue where he
serves stale cake that he gets from Wolfie's and places like that to serve
these people to get their dollar bets and $2 bets, and he had a tele-
phone there, and I believe that he had that telephone robbed out there
and put back in his house. He took it out of 1431 Washington Avenue
and put it back in his house.
Mr. Gips. Your Honor, how could I ? I was in the city hospital for
30 days. How could I get a phone ?
The Chairman. We know you were in the hospital, Mr. Gips.
Mr. GiPS. I got the keys, and I said, "Pat Perdue, here is the key to
the horse room in front. I got a little restaurant," and he took the
keys and he opened the horse room, and I have five telephones there
and they are still there. I haven't touched any telephones to put into
my house.
The Chairman. You mean the telephones are still there ?
Mr. Gips. They are still there today. Your Honor.
The Chairman. That is one of these mysteries that we will probably
never solve.
Mr. Gips. I gave him the keys to the place and I said, "Pat Perdue,
if yon are here to make an arrest of bookmakers, here is the keys,"
and he opened the door and he walked in and he found the phones in
order.
The Chairman. All right, sit down.
Mr. Perdue. I feel that I wasn't given a chance to answer Frenchy's
statement, and I would like to have an opportunity to do that without
interruption, because I didn't interrupt him at all.
The Chairman. Go ahead. This is about the telephone. There are
other things you have been accused of. You came down to Sunny Isles.
Mr. Perdue. That was on Christmas night. I went in there and had
a drink downstairs. I didn't go up to the gambling room at all.
68958—50 — pt. 1 28
424 ORGANIZED CRIME' IN INTERSTATE COMMERCE
The Chairman. And Mr. Levitt came down and saw you and spoke
liarsh words to you and told you to get out ?
Mr. Perdue. They weren't harsh words. He told me he didn't think
I should be around there.
The Chairman. You were an officer of the law.
Mr. Perdue. I was, but that is out of the county, and is not a part
of it.
There is a restaurant downstairs and I was only in the restaurant
and he told me to get out. He didn't want me in there.
The Chairman. That is substantially what Mr. Gips told us; that
you were told to get out.
Mr. Perdue. That is what it amounted to.
The Chairman. How come Mr. Levitt could order you to get out of
some place?
Mr. Perdue. He is supposed to be the manager, but the place was
out of my jurisdiction.
The Chairman. It is a restaurant open to the public.
Mr. Perdue, I had a drink and I was through with the drink.
The Chairman. You were a police officer.
Mr. Perdue. I am not a police officer of the county. I am a police
officer in Miami Beach.
The Chairman. You are an officer of Miami Beach, but you can go
somewhere as a citizen. He ordered you to get out of a public restau-
rant ?
Mr. Perdue. I think that he might have thought I w^anted to go up-
stairs and look around.
The Chairman. What if you did go upstairs and looked around?
Mr. Perdue. It didn't make any difference because I didn't care. I
wanted to look the place over. I would at least like to answer that.
I was there on Christmas night.
The Chairman. And you obeyed his order to get out ?
Mr. Perdue. He as much as asked me to leave and I left.
The Chairman. What else do you want to tell the committee ? Is
there anything else ?
Mr. Perdue. I feel that this whole arrest had to do with Frenchy's
coming up here and perjuring himself before this body.
The Chairman. Tell us wherein or in what other way he perjured
himself.
Mr. Perdue. I don't recall all of the testimonj^ but it did make me
sort of mad because
The Chairman. You have been given an opportunity to make any
explanation or any countercharges or accuse Mr. Gips of any perjury
you want to, but be specific about what you think he told us that is un-
true.
Mr. Perdue. I feel about the telephone — he stated that I put it back
through the man I got my orders from. I don't know who the man
was back there.
The Chairman. Wliat else ?
Mr. Perdue. Something about I called up places on the telephone
and told them that I needed a man, and there were a few" other things
there.
The Chairman. This is your chance to be heard about it.
Mr. Perdue. I would like to take my time and do it light. I don't
want to get myself all excited here and take the time of the com-
ORGAISriZED CRIME' IN ESTTERSTATE COIVCME'RCE 425
mittee and not do it right. I feel that I should have the opportunity
to
The Chairman. Mr. Perdue, we are giving you the opportunity
right now.
Mr. Perdue. I am trying to tell you. About me calling up. I
don't recall that I ever called Frenciiy or anybody else to tell them
that I needed a man. I always went into a gambling place and if
I saw gambling, I made an arrest. I don't recall any time that I
ever went in a place where there was gambling that I didn't make
an arrest.
The Chairman. Is there anything else?
Mr. Perdue. That is about the extent of it.
The Chairman. I was interested in your testimony that in the last
4 or 5 months you have been really going after them ; that you have
been doing something about it.
Mr. Perdue. Yes, sir.
The Chairman. What has been the difference between now and
4 or 5 months ago ?
Mr. Perdue. The difference between 4 and 5 months ago and now
is the fact that there has been all this newspaper publicity and all
the trouble that seems to be caused. My orders are specific and they
have been since I have been back on the job. I would say since
January 23. That is the date I went back on this job.
The Chairman. What were your orders before then ?
Mr. Perdue. I was off the job for 6 months.
The Chairman. Before you were off the job 6 months, what were
your orders?
Mr. Perdue. Well, they varied.
The Chairman. What do you mean, "varied" ?
Mr. Perdue. During Short's administration, he didn't seem to
worry too much about the gambling situation. However, I was pretty
much concerned about it, and I think my arrest records will show that.
The Chairman. Anyway, there wasn't much done about it until 4
or 5 montiis ago when you came back ?
Mr. Perdue. That is not true.
The Chairman. Anyway, it got quite different ?
Mr. Perdue. I got so pacific that I felt that unless I did break my
neck and try to catch everything that was going on, I wouldn't be
doing the right job. I tried to be a good police officer and do my
work the best I knew how.
The Chairman. Didn't the S. & G. close up operations about 4 or
6 months ago ? The season was about over then, wasn't it ?
Mr. Perdue. I found there was a lot more going on then in the
winter time than now.
The Chairman. You didn't get tight on this thing until the season
closed up and the S. & G. went out of operation ?
Mr. Perdue. No, I was making arrests all the way through — four,
five, and six cases.
The Chairman. Of the book operators around ?
Mr. Perdue. Yes, sir. The records will show it.
The Chairman. Did you go to the S. & G. office ?
Mr. Perdue. To the S. & G. office.
The Chairman. Or the S. & G. Investment Co. Did you make
arrests there ?
426 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Perdue. They probably have syndicates and syndicates and all
kinds of syndicates.
The Chairman. I am talking about a part of the syndicate, or the
heart of it. You know where the office is, don't you ?
Mr. Perdue. I have an idea where it is at.
The Chairman. You know where it is?
Mr. Perdue. It is on Washington Avenue in the Washington Avenue
Building.
The Chairman. You have been there ?
Mr. Perdue. Yes, but not in the office.
The Chairman. Have you made any arrests in the office ?
Mr. Perdue. No, sir ; I haven't.
The Chairman. You get the little fellows on the outside ?
Mr. Perdue. I get the big ones and the little ones, and I have testi-
mony to prove that.
The Chairman. Do you know Salvey, Friedman, Levitt, Cohen, and
Russell ?
Mr. Perdue. 1 know them all except Russell. I don't know the man,
never saw him before in my life and wouldn't know him if I saw his
picture.
The Chairman. And Rosenbaum?
Mr. Perdue. I know them all.
The Chairman. Did you ever arrest any of them ?
Mr. Perdue. No, sir.
The Chairman. All right.
Mr. Hallet. Isn't it a fact that you have arrested and do arrest
syndicate operators every year?
Mr. Perdue. Sir, I have made so many arrests throughout the 2
years and 8 months since I have been on this job that I couldn't tell
you offhand who all of them were. However, there is one in particular
that I think this committee is interested in, and that is Harry Russell.
I do recall that I arrested a brother-in-law of his at the Robert Richter
Hotel, but as far as Harry Russell is concerned, I don't know that I
have ever seen him before in my life.
Mr. Halley. Russell operated in the Robert Richter Hotel for a
couple of years, didn't he?
Mr. Perdue. No, sir ; not to my knowledge. That hotel hasn't had
a book in there for 3 years.
Mr. Halley. His brother-in-law tried to operate there in 1947?
Mr. Perdue. I believe he tried to operate there.
Mr. Halley. And you stopped him ?
Mr. Perdue. I put him in jail for vagrancy.
Mr. Halley. That was because Russell was trying to muscle in on
a nonsyndicate operation at the Robert Richter.
Mr. Perdue. I don't know about that.
Mr. Halley. What do you think ?
Mr. Perdue. To my knowledge there hasn't been a book at the
Robert Richter Hotel since that time.
Mr. Halley. No, because he stopped it.
Mr. Perdue. I think there was a man there named Harry Cohen in
1946. I don't recall that Russell was ever there. I just happen to
recall about that man. I don't even know his name.
Mr. Halley. You do make arrests of syndicate operators and
bookies who operate?
ORGANIZED CRIME IN INTERSTATE COMMERCE 427
Mr. Perdue. I arrest all of them. I don't have any favorites.
Mr. Halley. That is because from time to time the syndicate has
indicated that they will take certain arrests, isn't it, in order to make
things look good ?
Mr. Perdue. If they make that statement, I think that I make it look
fiwful good.
Mr. Halley. Didn't you from time to time talk to the attorneys
for the syndicate about the arrests situation?
Mr. Perdue. I talked to Ben Cohen. I argue with him in court day
in and day out. He has a lot of cases. He handles most all the cases
himself.
Mr. Halley. Did you ever talk to him out of court ?
]Mr. Perdue. Yes, sir ; I have.
Mr. Halley. Did you ever talk to him about arrests that hadn't yet
been made ?
Mr. Perdue. No, sir.
Mr. Halley. Have you ever had a conversation with Ben Cohen
about arrests that hadn't j^et been made ?
Mr, Perdue. I don't understand the question.
Mr. Halley. Did you ever talk to Ben Cohen about an arrest that
was going to be made at some future time, maybe an hour later or a
day later ?
Mr. Perdue. Yes, I did. I told him that I was on a certain thing
and on a couple or three occasions-
Mr. Halley. You know he is counsel for the syndicate ?
Mr. Perdue. Yes. He is counsel for practically all of the book-
makers over on the beach. He represents all the syndicates.
Mr. Halley. Did you hear the witness, who was the former chief
of police at Miami Beach, testify that when he became chief of police
he didn't want anything to do with bookmaking and that he just called
you in and said it is your baby ?
Mr. Perdue. At that time Lieutenant High was on detail and he
stayed on for some time.
Mr. Halley. Chief Short didn't want anything to do with book-
making. He didn't want to consider it his responsibility although he
was chief ; is that right ?
Mr. Perdue. He might have told you that, but I think he felt
differently. I think he felt he had a responsibility, the same as I did,
and he got in a lot of hot water in talking about fingerprinting book-
makers and things like that.
Mr. Halley. Was he telling the truth w^hen — wait a minute. What
do you mean about "getting in hot water for talking about finger-
printing the bookmakers" ?
Mr. Perdue. The newspapers had published it.
jSIr. Halley. Why would that get the chief of police in hot water ?
!Mr. Perdue. Because they were nice people.
]Mr. Halley. The chief of police said they were nice people ?
]\Ir. Perdue. That is right.
Mr. Halley. Or that the people that go there are nice people ?
Mr. Perdue. That is right.
Mr. Halley. And he didn't want to get them in bad.
Mr. Perdue. He didn't want to get them fingerprinted. That was
mv idea.
428 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Halley. Wliat newspapers caiiglit it ?
Mr. Perdue. The Herald wrote it up. Tliey wrote headlines on it
for 2 or 3 days.
Mr. Halley. So he gave up the idea? He gave up the idea about
fingerprinting them ?
INIr. Perdue. Every chance I ever got I fingerprinted them.
Mr. Halley. You mean the newspapers criticized him for wanting
to fingerprint the bookies ?
Mr. Perdue. Yes, sir ; they did.
Mr. Halley. You are quite sure about that ?
Mr. Perdue. I believe that is right.
Mr. Halley. Was it about that time that he called you in and had
the conversation that he testified to ?
Mr. Perdue. Which one ?
IMr. Halley. In which he said that yovi — you remember he testified
that he called you in and said, "Going after the bookies is your job,
and I don't want to know anything about it, Mr. Perdue." That is
his testimony.
Mr. Perdue. He must have wanted to know something about it
because he demanded a report every day and I gave it to him.
Mr. Halley. He did so testify. Was he telling the truth or un-
truth ?
Mr. Perdue. I don't know whether it is the truth or not because I
don't know what is in the man's mind. I felt he wasn't too much
interested.
Mr. Halley. Did he have such a conversation with you? Did he
call you in and say, "Mr. Perdue, bookmaking is your baby. I don't
want to know anything about it. It is your job" ?
Mr. Perdue. There might have been a conversation like that, yes.
Mr. Halley. Was it a conversation ?
IMr. Perdue. I don't know sir. I don't remember.
Mr. Halley. Do you want to stand on that testimony ?
Mr. Perdue. I do want to stand on that testimony.
Mr. Halley. Were you the one-man gambling squad of Miami
Beach ?
Mr. Perdue. I was known as that for approximately 2 years;
yes, sir.
Mr. Halley. No further questions.
The Chairman. Mr. Perdue, did you have information about the
so-called ice money?
Mr. Perdue. I have heard about it and I have read about it.
The Chairman. $75 a week for ice money in addition to $50 for
operating ?
Mr. Perdue. I made numerous arrests on these 30-line sheets, and
it would say at the top so much money for telephone and so much
money for this and so much for that, refreshments and so forth.
They put that on the top.
The Chairman. Did you investigate this ice money from
Mr. Perdue. I don't know whether this testimony is true or not.
The Chairman. Did you investigate it?
Mr. Perdue. No ; I didn't.
The Chairman. You heard about it?
Mr. Perdue. I read it in the papers.
ORGANIZED CRIMEA IN INTERSTATE COMMENCE 429
Tlie Chairman. You have been hearing about it a long time, haven't
you?
Mr. Perdue. Lately more than other times. There has been a lot
about the ice money.
The Chairman. Have you investigated it yet ?
Mr. Perdue. Well, sir, I just wouldn't know how to go about inves-
tigating it. I don't know whether I have the power to do it.
The Chairman. You are around with all these bookies, so when you
arrest them they wouldn't be paying any ice money.
Mr. Perdue. Up until 3 weeks ago I would ask Frenchy about the
ice money and he wouldn't tell me.
Mr, GiPS. It is right on the sheet, Your Honor.
The Chairman. Did you see it on the sheet ?
Mr. Perdue. Sir, as I said, I see things on the top.
The Chairman. Do you know where the sheets go to ?
Mr. Perdue. I imagine they go to some headquarters.
The Chairman. You know where they go to.
Mr. Perdue. They go to the S. & G. Syndicate.
The Chairman. So wouldn't they be the ones who would know
about the ice money ?
Mr. Perdue. I imagine so.
The Chairman. Don't you think that would be a good place to
inquire ?
Mr. Perdue. I have asked a lot of questions.
The Chairman. With all these rumors of political money paid by
these bookies, doesn't that reflect upon you enforcement officers, so
Avhy wouldn't you want to clear that up in your own good name ?
Mr. Perdue. You are trying to put me on the spot because I don't
know anything about the ice money. I have heard about it, but I can
tell you one thing, that I have never received any of it; that's for
sure.
The Chairman. That is one reason why I say that you should in-
vestigate to see what happened to it.
Mr. Perdue. I had so many things to investigate over there that I
just never thought about the ice money. That is all. I don't know
whether I have the power to.
The Chairman. What do you mean, whether you have the power?
Aren't you a one-man racket squad ?
Mr. Perdue. I think that should come from some court in the form
of an order to grab these records and then go into the ice money. If
I had found records in my raids and arrests and taken them in, I
might have done that.
The Chairman. All right. Is there anything else, Mr. Perdue, that
you want to state ?
Mr. Perdue I would like to answer any questions that are put be-
fore me. I feel that I would like to give you a clear picture of my
position over there and I am willing to answer all questions to the
best of my ability.
The Chairman. Unless you have some other statement, that will be
all. Thank you.
Mr. Perdue. Thank you, sir.
The Chairman. I think in fairness — something has been said about
a wallet being found — I should read into the record "received Febru-
430 ORGANIZED CRIME' IN INTERSTATE COMMERCE
ary 23, 1943, wallet" — is that the wallet involved there that Frenchy
got his name on ?
Mr. Perdue. Well, sir, it happened so many times — in fact, it hap-
pened here about 2 months ago that Frenchy found a wallet. Every
time I seen him he found another wallet — that I couldn't see how he
found so many wallets.
The Chairman. Well, anyway he always turned them in.
Mr. Perdue. He alwaj^s takes them to the police station and makes
sure there is a newspaper reporter there.
The Chairman. Well, anyway this one contained one platinum
ladies' ring set with marquise
Mr. Perdue. One more thins
The Chairman. Just a minute. [Continuing.] Diamonds
(The Chairman proceeded to read the articles of diamonds and
jewelry enumerated on the list referred to.)
The Chairman. Signed "Ed Carpenter, chief of police, Miami
Beach City Police Department."
I really think, in fairness we ought to say that is a very commendable
act, that this man engaged in bookmaking found jewelry worth I
suppose many thousands of dollars and turned it in.
Mr. Perdue. I don't say it isn't a good act.
The Chairman. You can have these [handing documents to Mr.
Gips] .
Mr. Perdue. Is that all, sir ?
The Chairman. Yes.
Mr. Perdue. Thank you, sir.
The Chairman. Mr. Claude Renshaw has been subpenaed to testify
but we have a certificate from his doctor dated July 13, 1950, stating
Mr. Renshaw is a patient of his "convalescing from a recurrent virus
infection." He has been ill for the past 2i/2 weeks and had been hos-
pitalized at St. Francis Hospital, Miami Beach, Fla., from July 3
through July 11, 1950.
"I believe that it would be detrimental to Mr. Renshaw's health to
be subjected to any public interviews at this time. If it is absolutely
necessary that he be interviewed I recommend that the interview take
place at his home and that it not be undulv prolonged. Emmett T.
Fitzpatrick, M. D."
That will be made a part of the record. Now, I believe Mr, Bur-
bridge is here.
Mr. Burbridge, do you solemnly swear that the testimony you will
give this committee will be the whole truth and nothing but the truth,
so help you God ?
Mr. Burbridge. I do.
TESTIMONY OP WILLIAM BURBEIDGE, CITY COUNCILMAN,
MIAMI BEACH, PLA.
The Chairman. All right, Mr. Halley, and let us try to shorten up
on our testimony at this point if we possibly can.
Mr. Burbridge. That will suit me.
Mr. Halley. What is your occupation ?
Mr. Burbridge. I guess I am retired. I am in the real estate busi-
ness, real estate operator.
ORGANIZED CRIME IN INTERSTATE COMMERCE 43]
Mr. Halley. Are you a member of the Miami Beach Council ?
Mr. BuRBRiDGE. Yes, sir.
Mr. Halley. How long have you been a member of the council?
Mr. BuRBRiDGE. I have been a member since 1932.
Mr. Halley. And you are still a member ?
Mr. BuRBRiDGE. Yes. I got 3 years to go.
Mr. Halley. Are you acquainted with the S. & G. Syndicate part-
ners, with the S. & G. partners ?
Mr. BuRBRiDGE. Harold Salvey
Mr. Halley. Harold Salvey is one you know?
Mr. BuRBRiDGE. Harold Salvey is a personal friend of mine.
Mr. Halley. Are any of the others friends of yours ?
Mr. BuRBRiDGE. No, sir.
Mr. Halley. Do you know them ?
Mr. BuRBRiDGE. Yes.
Mr. Halley. You speak to them and you are acquainted with them ?
Mr. BuRBRiDGE. Jules Levitt I have known for a great many years.
Charles Friedman, I don't know him so well. He is not as conspicuous.
Mr. Halley. Rosenbaum?
Mr. BuRBRiDGE. I know him when I see him. Sam Cohen is a very
conspicuous sort of person.
Mr. Halley. He is not conspicuous here today ; is he ?
Mr. Burbridge. No.
Mr. Halley. You know Sam Cohen ?
Mr. Burbridge. Oh, yes.
Mr. Halley. You know Harry Russell ?
Mr. Burbridge. I think I have met him. I never had any conversa-
tion with him. I have an idea that I met him.
Mr. Halley. Salvey is really a good friend of yours ; is he not ?
Mr. Burbridge. He is a good friend of mine.
Mr. Halley. You had certain business transactions with Salvey;
have you not ?
Mr. Burbridge. Yes.
Mr. Halley. Would you just take your time and state all of the
business transactions that you have had with Mr. Salvey ?
Mr. Burbridge. Well, possibly a year ago, a year and a half ago, I
loaned him $40,000.
Mr. Halley. Go ahead.
Mr. Burbridge. The loan was at 10 percent. He paid that loan
possibly a couple of months later. It was in such a way that he was
to pay 10 percent even if he took it up previous to the due date.
Mr. Halley. You gave him $40,000 for a couple of months and you
got $4,000 back?
Mr. Burbridge. No, sir. It was for a year at 10 percent.
Mr. Halley. And he paid it back ?
Mr. Burbridge. It was a 10-percent note.
Mr. Halley. You got your money back ?
Mr. Burbridge. I got the money back, a $30,000 check in 2 or 3
months, and several months afterward I got $10,000 in cash.
Mr. Halley. $10,000 in cash ?
Mr. Burbridge. Yes.
Mr. Halley. You gave him a check for $40,000 ?
Mr. Burbridge, I gave a check for $40,000.
432 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. You also got your 10 percent?
Mr. BuRBRiDGE. No. I got $2,000 ; 5 percent.
Mr. Halley. You got 5 percent?
Mr. BuRBRiDGE. Yes.
Mr. Halley. Why was the interest rate cut ?
Mr. BuRBRiDGE. Because he paid it sooner.
Mr. Halley. He paid it sooner?
Mr. BuRBRiDGE. He paid it oflf after several months.
Mr. Halley. What would Salvey — he is a wealthy man, isn't he?
Mr. Burbridge. I doubt it.
Mr. Halley. You know something of the operations of the S. & G.
Syndicate ?
]\Ir. Burbridge. I do not.
Mr. Halley. Do you know that he is a member of the syndicate?
Mr. Burbridge, Yes, sir.
Mr. Halley. You know that they control a great many bookmaking
establishments, don't you?
]Mr. Burbridge. I know it because I hear it, yes. That is the only
way. I have no personal knowledge.
Mr. Halley. Have you any reason to know why Salvey would have
to come to you for $40,000 ?
Mr. Burbridge. I offered it to him.
Mr. Halley, What did he need it for ?
Mr. Burbridge. I have forgotten. I don't know what he needed
it for.
Mr. Halley. But out of it you got a profit of $2,000, is that right?
Mr. Burbridge. I didn't get a profit.
Mr. Halley. Well, you got interest
Mr. Burbridge. I got interest.
Mr. Halley (continuing). At the rate of 10 percent.
Mr. Burbridge. No.
Mr. Halley. Well, that was the annual rate.
Mr, Burbridge. But I didn't get $4,000.
Mr, Halley. But he didn't have the money for a year. You got
the annual rate of 10 percent. You got $2,000 for 3 months. That,
in fact, would be 20 percent.
Mr. Burbridge. You can figure it any way you want. It was 10
percent. When it was paid I should have gotten $4,000. That is the
way the note was drawn. I gave Mr. Salvey a couple of mortgages
over there of $50,000 each at 10 percent, each one of those mortgages,
and if he pays it the day after he makes the loan he would have to
pay the $4,000—10 percent is $5,000. He would have to pay $5,000.
Mr. Halley. In any event, he paid you $2,000 ?
Mr. Burbridge. $2,000 ; yes.
Mr. Halley. He paid you $2,000 3 months later.
Mr. Burbridge. Several months later.
Mr. Halley. What otlier business transactions did you have with
Salvey ?
Mr. Burbridge. Several years ago Salvey sent me from California —
he was out there visting his mother — a check for $2,000 — $1,000, a
cashier's check. I have never been able to determine — the Govern-
ment is handling my income tax — and he has never been able to remem-
ber and determine himself what that $1,000 was for.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 433
You think it is funny? I don't think it is funny. Wliat is funny
ibout it [addressing person in atidience] ?
The Chairman. I must admonish the audience not to make any
demonstrations one way or the other about the testimony heard.
Did you cash the check ?
Mr. BuRBRmoE. It would have been a very simple thing for Mr.
Salvey and me to figure out something, the reason that $1,000 check
was sent me what that check was for. I am able to figure things out.
I have been doing it all my life and making a living figuring things
out, but I don't know why he sent me that $1,000.
Mr. Halley. What other financial transactions did you have with
him?
Mr. BuRBRiDGE. I gave him a 99-year lease — I sold him a 99-year
lease on the corner of Fourteenth Street and Washington Avenue,
Miami Beach, for $6,000 a year. I had an interest — a half interest —
in that property.
Mr. Halley. When did you sell him that lease ?
Mr. BuRBRiDGE. He built a building on that property now, a year
and a half ago — 2 years ago.
Mr. Halley. And you receive on that lease $6,000 a year; is that
right?
Mr. BuRBRiDGE. Yes ; it is a 99-year lease.
Mr. Halley. Have you had any other business transactions with
Salvey?
Mr. BuRBRiDGE. I sold him several pieces of property; yes, sir.
Mr. Halley. Did you make a profit on any of those sales?
Mr. BURBRIDGE. No.
Mr. Halley. Will you state what the sales were ?
]Mr. BuRBRiDGE. I sold him — well, on some of them I got commis-
sions. I sold him a property on Forty-first Street maybe 5 or 6
years ago. I doubt if I got any commission out of those. I don't
think I did. They were four parcels on Forty-first Street.
Mr. Halley. Perhaps we can shorten it. You did get commissions
from time to time
Mr. BuRBRiDGE. I got commissions.
Mr. Halley (continuing). From Salvey
Mr. Burbridge. Yes.
Mr. Halley (continuing). On real-estate sales?
Mr. Burbridge. Yes.
Mr. Halley. Xow, have you had any other transactions ?
Mr. Burbridge. No. I doubt it. No. If you can ask me about
one you got all the information.
Mr. Halley. How many commissions would you say you got from
him?
Mr. Burbridge. Maybe two or three.
Mr. Halley. No other questions.
Mr. Burbridge. Have you got a copy of the $30,000 check ?
Mr. Halley. Probably.
Mr. Burbridge. I have been trying the last few days to get a copy
of that. Could you tell me the number of it or may I see it ? I lost
the original.
The Chairman. Mr. Burbridge, this land that you leased to ]Mr.
Salvey for $6,000 a year for 99 years — when did you buy the land?
434 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. BuKBRiDGE. I bought it probably 10 years ago.
The Chairman. How much did you pay for it ?
Mr. BURBRIDGE. $15,000.
The Chairman. $15,000?
Mr. BuRBRiDGE. Yes; that was the cost. I had a half interest m
that. My half interest cost me $7,500.
The Chairman. This $6,000 a year is for your part of the lease?
Mr. Burbridge. That is mine.
The Chairman. Is that what you get or what you and your partner
get?
Mr. Burbridge. No ; that is mine.
The Chairman. Then the total lease is $12,000 a year?
Mr. Burbridge. No. He bought the other half interest.
The Chairman. So you paid $7,500 for it 10 years ago
Mr. Burbridge. And leased it for $6,000 a year for 99 years.
The Chairman. Did you put any improvements on it of any sub-
stantial nature?
Mr. Burbridge. No. The city put some very substantial improve-
ments on it. I bought it as an apartment site and they turned it into
business and that makes it valuable.
The Chairman. Were you on the city council then ?
Mr. Burbridge. Yes.
The Chairman. Do you have to pay taxes on this $6,000 a year?
I mean, do you have to pay real-estate taxes, insurance, or anything
like that, or is that net to you ?
Mr. Burbridge. No ; I don't pay any taxes.
The Chairman. You get $6,000 a year out of an investment of
$7,500 you made 10 years ago ?
Mr. Burbridge. Yes.
The Chairman. All right, sir.
Mr. Burbridge. That is my business. I have done that a number
of times.
The Chairman. That is all, Mr. Burbridge. We will look for this
check. Did we get tliis check from you ?
Mr. Burbridge. It isn't pertinent to this.
Mr. Halley. We Avill try to find it. If we have it we will let you
see it or photostat it or do whatever you need.
Mr. Burbridge. You haven't got two copies, have you ?
Mr. Halley. We are looking for it. We have quite a few checks
of yours.
The Chairman. Mr. Furman, will you come around here?
FURTHER TESTIMONY OF M. G. FURMAN, ACCOUNTANT,
MIAMI BEACH, FLA.
Mr. Halley. Mr. Furman, you were sworn yesterda}^ ?
Mr. Furman. That is right.
Mr. Halley. We have your records here, do we not ?
Mr. Furman. You do.
The Chairman. What is your first name, Mr. Furman ?
Mr. Furman. M. G. Furman.
Mr. Halley. Will you just as briefly as you can state what records
you have produced and put them before the committee so that they
can be taken into evidence ?
ORGANIZED CRIME: IN INTERSTATE COMMERCE 435
Mr. FuRMAN. The work sheets which I have prepared in connection
with the pending revenue agent's examination in my capacity as ac-
countant for Mr. Salvey.
I would lilve to call to the attention of this committee that there is
a certain section under the laws of the State of Florida which states
that documents and other information obtained by a c. p. a. serving
a client are privileged communications.
Mr. Halley. You have already given them to the committee. We
have looked at them. The privilege is gone.
Mr. FuRMAN. I wouldn't know whether it is or not.
Mr. Halley. It is. There is no privilege left after you make some-
thing public.
Mr. FuRMAN. I want to put that in the record so that it will show
that I am appearing in my capacity as a c. p. a. presently engaged in
an income-tax matter pending before the Bureau of Internal lievenue
involving Harold Salvey.
Mr. Halley. Surely.
The Chairman. All right, put this in the record.
Mr. FuRMAN. This is the section [handing document to the chair-
man] .
The Chairman. Put in the record [handing document to the re-
porter J .
(Chapters 473.15 and 473.18, Laws of Florida, were copied into the
record as follows :)
Chapter 473.15. Communications between accountant and client privileged.
All communications between certified public accountants and public accountants
and the persons for whom such certified public account or public accountant
I shall have made any audit or other investigation in a professional capacity and
' all other information obtained by certified public accountants in their professional
capacity concerning the business and affairs of clients shall be deemed privileged
communications in all of the courts of this State, and no such certified public
accountant or public accountant shall be permitted to testify with respect to any
of said matters except with the consent in writing of such client or his legal
representative.
Chapter 473. IS. Records, etc., to remain property of accounts. All statements,
records, schedules, and memoranda made by a c. p. a. or a public accountant
or the employee or employees of a c. p. a. or of a public accountant, incident
to or in the course of professional service to a client, except the reports submitted
by such c. p. a. or public accountant to the client, shall be and remain the
property of such c. p. a. or public accountant in the absence of an express agree-
, ment between the c. p. a. or public accountant and the client.
Mv. Halley. I think to your credit it should be stated, Mr. Furman,
that you did produce them and produced them voluntarily and the
'Committee had them for a day.
INIr. Furman. That was my purpose in presenting this.
Tlie Chairman. It is part of the record, Mr. Furman.
Mr. Halley. Let us go ahead with the rest, please.
Mr. Furman. These are various work sheets that I have developed
i [indicating] which include income-tax returns and other data of
Harold Salvey. They include various papers pertaining to purchases
and so forth. They include canceled checks and the like, taxes and
so forth, and other documents pertaining to real estate that Harold
Salvey made improvements on, placed improvements on, construction
costs, and so forth.
Mr. Halley. You have also done accounting for the S. & G.
Svndicate ?
436 ORGANIZED CRIME: in INTERSTATE COMMERCE
Mr. FuRMAN. The accounting I have done for the S. & G. Syndi-
cate is what I have done since I was retained by their attorney.
Mr. Halley. This year?
Mr. FuRMAN. Witiiin the last few weeks.
Mr. Halley. And you made an examination of their books for
certain purposes?
Mr. FuRMAN. For certain purposes that I testified to here.
Mr. Halley. And you had the books of the S. & G. Syndicate in
your office?
Mr. FuRMAN. That is right.
Mr. Halley. And you also had 30-line sheets?
Mr. FuRMAN. I did not. I did not testify I did.
Mr. Halley. I am asking you now.
Mr. FuRMAN. I did not.
Mr. Halley. Weren't they turned over by the Bureau of Internal
Revenue to you?
Mr. Ftjrman. They were not.
Mr. Halley. In connection with your investigation of the books
and records of the S. & G. Syndicate could you tell this committee
what the gross income of the S. & G. Syndicate was for the year 1948.
Mr. FuRMAN. No, sir.
Mr. Halley. The gross.
Mr. FuRMAN. The gross?
Mr. Halley. Yes.
Mr. FuRMAN. I cannot recall.
Mr. Halley. You have seen the figures, haven't you ?
Mr. FuRMAX. I have seen the figures at one time, yes.
Mr. Halley. Isn't the gross "ins" $26,520,045 ?
Mr. FuRMAN. In that neighborhood.
Mr, Halley. Wliat is the gross "ins" for the year 1949 ?
Mr. FuRMAN". I did not have anything to do with 1949 because the
pending tax case is merely up to 1948.
Mr. Halley. Let us take the year 1948. Will you state whether
that figiire of $26,520,045 would represent the total of all the bets
taken in by the S. & G. Syndicate?
Mr. FuRMAN. I wouldn't know.
Mr. Halley. Would you say that $26,520,045 represented the total
of all the bets booked by the S. & G. Syndicate and its agents for that
year?
Mr. FuRMAN. You mean
The Chairman. You mean, the total amount that came in ? Is that
what 5^ou are referring to?
Mr. Halley. Yes.
Mr. FuRMAisr. You mean, the total amount that was bet?
Mr. Halley. Yes.
Mr. FuRMAN. That is the money bet, if that is what he is talking
about.
Mr. Halley. The total amount bet with them ; yes?
Mr. FuRMAN. If you developed that from the records you w^ould
know.
Mr. Halley. Well, the total amount would be considerably larger
than that, wouldn't it?
Mr. FuRMAN. Not if you are talking about the money bet.
ORGANIZED CRIME: in ESTTERSTATE COMMENCE 437
Mr. Halley. AVliat would the total amount bet be ?
Mr. FuRMAN. I don't know.
Mr. Hali.ey. Did you hear the testimony of Gips here a little while
ago
Mr. FuRMAN. I couldn't hear much of it.
Mr. Haleey. Well, did you hear him testify that during the season
a bookie would take in $2,000 or $8,000 a day in bets ?
Mr. Furman. I don't think I was in the room when he said that.
Mr. Halley. Would that seem unreasonable to you ?
Mr. Furman. They have varying places, I suppose. That I wasn't
concerned with.
Mr. Halley, He is a small operator, isn't he ?
Mr. Furman. I don't know Mr. Gips. I never heard of him.
Mr. Halley, Then he must be a small operator.
Mr. Furman. I wouldn't say that because I am not familiar with
the diiferent stations that operated.
Mr. Halley. While he was testifying I did some arithmetic. Let
us see if you as an accountant will go along with me on it. If you
figure 100 days in the season an average, a little over 3 months, and you
figure that the average bookie took in only $1,000 a day during the
season you would get $100,000 per bookie ; is that right ?
Mr. Furman, Will you start again so I can follow you ?
Mr, Halley. Suppose you hgure there are 100 days in the winter
season.
Mr. Furman. Yes, and there is.
Mr. Halley, And $1,000 a day taken in gross bets.
Mr, Furman, Then the bets would be $100,000.
Mr. Halley. $100,000 taken in by the bookie; is that right?
^Ir. Furman. That is right.
JNIr. Halley, And that is taking a low figure. You said $1,000,
$2,000, or $3,000,
Mr. Furman, On the basis of your hypothesis. I don't know,
Mr. Halley. How many bookies are there working for the S. & G.
Syndicate ?
Mr. Furman. I have no knowledge of it.
Mr. Halley. Isn't it around 200?
Mr. Furman, I don't know,
^Ir. Halley. Well, the books and records show a minimum of 200
locations.
Mr. Furman. If you say so. I don't know.
Mr. Halley, Well, you have seen the books.
Mr. Furman, I have seen the general ledger as I testified, and the
journals. I merely saw one book which was for 1949 as an illustration
only. The other records I have never seen.
Mr. Halley, Well, suppose you take 200 locations; what did your
illustration show for 1949 as to the number of locations?
Mr. Furman. I didn't count them. There was a ledger.
Mr. Halley. Two hundred would be a low estimate; don't you
hink so?
Mr. Furman, I wouldn't say that,
Mr, Halley. It would be a high estimate?
Mr. Furman. It would be a high estimate, I would think,
Mr. Halley. Let us go ahead on 2'00 anyhow, because we are taking
I very low estimate oil the $100 a day, don't you think?
438 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. FuRMAN. I have no knowledge.
Mr. Hallet. During the season.
Mr. FuRMAN. I have no knowledge what they did because I have
never seen any 30-line sheets. I merely made a limited examination
as I testified to the other day. It was 'for limited purposes. In that
connection I just saw general total figures.
Mr. Halley. Accepting Mr. Gip's testimony and multiplying
$1,000 by 100 days you get $100,000 ; is that right?
Mr. FuRMAN. That would be right.
Mr. Halley. Would you multiply that by 200 bookies? You get
$20,000,000, do you not?'
Mr. FuRMAN. $20,000,000 is right.
Mr. Halley. Now, Mr. Gips testified that when the season is not
on during the rest of the year he would take in a minimum of $200
a day in any event. Will you multiply $200 a day by 250 days for the
remainder of the year? That gives you $75,000, doesn't it?
Mr. FuRMAN. 250 times $200 I guess gives — gives me $50,000.
Mr. Halley. $50,000? Yes; that is correct. Then let us assume
that during the off season there are only 100 bookies operating.
Would that be a fair assumption ?
Mr. FuRMAN. I suppose. I don't know.
Mr. Halley. And vou s'et $5,000,000 there; is that right?
Mr. FuRMAN. $5,000,000 ? Yes ; that is right.
Mr. Halley. So you get $20,000,000 plus $5,000,000; is that right?
Mr. FuRMAN. On the basis of this hypothesis.
Mr. Halley. And that is fairly close to the $26,520,045 that the
books show for 1948 ; is that right"?
Mr. FuRMAN. If you say the books show that. I merely have
Mr. Halley. Don't you have any recollection ?
Mr. FuRMAN. I merely have a general recollection because I ex-
amined them a number of years ago.
Mr. Halley, But that sounds like the right figure, doesn't it?
There is no reason why I should deceive you as to what the books
actually show?
Mr. FuRMAN. I am not saying that. I am stating that you are
merely telling me what the books show.
Mr. Halley. Do you know the percentage of return that the race-
track odds give the State parimutuel from bets in this State?
Mr. FuRMAN. I do not have it. I heard it rumored.
Mr. Halley. It is not a matter of rumor. It is a matter of law.
Mr. FuRMAN. I don't know as a matter of personal knowledge what
they do.
Mr. Halley. Well, isn't it general information that the parimutuel
machines are so fixed as to give a return of 15 percent to the operation,
the odds are arranged mathematically ?
Mr. FuRMAN. I have heard it said that the race tracks take off
of the amount of money bet a certain percentage of the operation of
the track and they take off of that a certain percentage, I think, that
goes to the State of Florida and whatever other items that are in-
volved.
Mr. Halley. And it is worked out so that the total amount returned
to the bettors is 85 percent of the total amount bet and 15 percent
stays with the operation ?
(ORGANIZED CRIMEA IN INTERSTATE OOMME'RCE 439
Mr. FuRMAN. That is what I heard ; approximately.
Mr. Halley. Now, the syndicate doesn't pay any better odds than
the race track, does it ? It pays the race track odds.
Mr. FuRMAN. I don't know of my own knowledge that they do.
Mr. Halley. Isn't it a fact that they pay the same percentage as the
race track?
Mr. Furman. I do not know.
Mr. Halley. Have you ever been told that?
Mr. FuRMAN. I have not.
Mr. Halley. Have you ever placed a bet ?
Mr. FuRMAN. At the track?
Mr. Halley. No, with the syndicate.
Mr. FuRMAN. No, sir.
Mr. Halley. Never?
Mr. FuRMAN. Never.
Mr. Halley. What do your records show as the income for 1948
from the syndicate for Harold Salvey ?
Mr. FuRMAN. That is not in these papers here.
Mr. Halley. Well, you are his accountant.
I Mr. FuRMAN. I brought a mass of documents. I haven't found it.
1| Mr. Halley. Take your time.
Mr. Furman. Here it is. The income-tax return, a copy of which
I have here for the calendar year 1948, reflects Harold Salvey's distrib-
I utive share of ordinary net income as $93,000.
j Mr. Halley. The Bureau of Internal Revenue has contested that
figure : has it not ?
i\Ir. FuRMAN. That is correct.
Mr. Halley. They claim it should be considerably larger, don't they ?
I I Mr. Furman. That is right.
II Mr. Hali.ey. Have you yet arrived at a compromise figure?
Mr. FuRMAx. No. The case is pending and there is an appointment
in Washington.
Mr. Halley. Hasn't the point been made as a starting point on this
tax situation that the S. & G. Syndicate makes at least 15 percent on
its bets but probably more because they don't pay odds of more than
. ,20 to 1 whereas the race-track does?
ij Mr. Furman. I do not know anything about that, Mr. Halley.
' Mr. Halley. How could you prepare this income-tax case without
knowing these facts?
Mr. Furman. Because we didn't get into that phase of it yet.
Mr. Halley. Well, everybody else seems to have gotten into it.
Mr. Furman. I didn't.
Mr. Halley. If the S. & G. Syndicate does as well as the race track
and makes 15 percent of its expenses on $26,520,045 worth of bets in
1948 what would the profit on those bets be ?
Mr. Furman. I make it approximately $4,000,000.
Mr. Halley. Now, the S. & G. did show some expenditures for the
year 1948, did they not?
jlj Mr. Furman. They show very large expenses,
f I Mr. Halley. What did they show according to the income-tax return
they filed for 1948 ?
Mr. Furman. I can't tell from this tax return.
Mr. Halley. Can you tell from the books and records you saw?
6895S— 50— pt. 1 29
440 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. FuRMAN. I cannot.
The Chairman. Let us see that.
Mr. FuRMAN. Yes [handing document to the chairman].
Mr. H ALLEY. They show expenses of about $1,254,000 for assorted
costs of operation, don't they ?
Mr. FnRMAN. I wouldn't know that.
The Chairman. Doesn't this show deductions of six hundred
thousand
Mr. FuRMAN. No. That is not it. Senator. That top figure is the
so-called money bet but as reduced by the losses and other expenses
that are paid off the top. That is what the top figure is.
Mr. Halley. Well, isn't the trouble that the way they do it is to
take their money each day, make a daily settlement in cash with the
bookie, and then proceed to throw the sheets on which the settlement
is made away, destroy the sheet on which the settlement is made so
that you can't tell afterward what they made or what they haven't
made?
Mr. FuRMAN. I heard that was said.
Mr. Halley. Isn't it also a fact that they claim that they paid out
in 1948, $24,696,000 in losses to betters ?
Mr. FuRMAN. What year ?
Mr. Halley. 1948.
Mr. Furman. I wouldn't know that.
Mr. Halley. Which would give them a profit of only $1,823,000 on
their bets.
Mr. FuRMAN. If I can have that tax return, maybe I could reconcile
that figure.
The Chairman. All right [handing document to witness].
Mr. Halley. In other words, they claim they are not getting their
15 percent return.
Mr. Furman. That is correct.
Mr. Halley. But that is impossible if they are paying the race-
track odds and refuse to pay more than 20 to 1 on any bet.
Mr. Furman. On the basis of your assumption only.
Mr. Halley. They do pay the race-track odds, don't they ?
Mr. Furman. They pay the races-track odds, but that doesn't meam
that the actual losses they incur run in that proportion.
Mr. Halley. Why noit?
Mr. Furman. Because what the race track does is to merely take
something off the cuff, and they take bets as they come in. The indi-
viduals who go to the window and place their bets, these individuals —
I am merely surmising — are concerned with large operators or larger
bets.
Mr. Halley. Isn't it quite the contrary ?
Mr. Furman. Or smart money if you want to call it that.
Mr. Halley. Isn't it quite the contrary that when a "hot" horse
comes along all the smart money is bet on the "hot" horse, the race
track has to take the bets but S. & G. wouldn't take those bets?
Mr. Furman. I wouldn't say that.
Mr. Halley. Isn't it also a fact that S. & G. maintains telephones,
w^itli bookies all over the country to w\atch at the last minute for a lot
of smart money being put on a horse so that all the bookies could and
O'RGANIZED CRIME: IN INTERSTATE COMMERCE 441
do refuse to take it when they see that the smart bettors are ganging
lip on it ?
Mr. FuRMAN. Mr. Halley, you are telling me something I don't
know.
Mr. Halley. That is something the pari mutuel can't do. They
take every bet that comes along, is that right ?
Mr. P'uRMAX, Pari mutuel takes bets as they come in. Most of the —
I am not familiar with the methods of bookie operations.
Mr. Halli^t. Well, the records of this committee made in executive
session show, for instance, that the gambler, Frank Erickson, would
keep a man posted on the track to take bets that he didn't want to hold
and they would put them right into the machine, the "hot" bets, those
that the syndicate didn't feel that they wanted to take a chance on.
They would palm them off on the machines.
Mr. FuRMAN. If you say so.
Mr. Halley. Don't you know that?
j Mr. FuRMAN. I do not know that. The scope of my work was ex-
tremely limited. I never was the auditor for the S. & G. Syndicate. I
was retained by their attorney here lately and I only had a limited
amount of time to get into this thing. We are preparing for a tax case.
Mr. Halley. If those things are right then the S. & G. Syndicate
must have made more than 15 percent on its bets.
Mr. FuRMAN. If you take your assumptions to be so the answer is
f'Yes."
Mr. Halley. I have no other questions of this witness.
The Chairman. I just want to ask: Do you consider these bookies
ike Frenchy and these fellow employees of the S. & G. or what are
:hey?
Mr. Ftjrman. I would be inclined to think they are independent
ontractors. This is my persojial opinion.
The Chairman. S. & G. on the bets they take, at least the small bets
hey divided 50-60?
' Mr. FuRMAN. Well, it wasn't exactly that. It was the money bet
ess the money paid out of the top which included losses and expenses
>i various kinds as agreed to under the contract.
The Chairman. What is this $50 off the top for an operator?
Vhat does he pay that for a week ?
! Mr. Furman. That is for wire services, as I understand it.
f The Chairman. Wire
Mr. FunMAN. Wire facilities.
- i The Chairman. He pays $50 and he gets half of all the bets that
' 'Ire not paid off ?
' Mr. Furman. It goes into what are called the "outs" to arrive at
net. Wlien the net "ins" is in excess of the total expenditures, then
m have a certain figure. Off that figure the usual arrangement is
i ) percent to the agent and out of that — no ; I beg your pardon. It
tt I the net "ins" but as reduced by the rental allowance.
' The bookie usually makes his own arrangements with the hotel or
ibana or whatever place he is operating. He pays that hotel a certain
If' nount of rent. That rent includes other things — cigar-stand opera-
lii 0ns and various other concessions that he may have rented around the
111 Hel.
The point I am leading up to is that whether a cigar operator or
lokie pays $10,000-a-year rent when he made his accounting in con-
442 ORGANIZED CRIME! m INTERSTATE COMMERCE
I
nection with the contract with the S. & G., he was allowed a limited
amount of that money as a rent allowance. That rent allowance was
deducted from the net "ins." Then the balance was split 50-50 as
their share.
The Chairman. Now, your records show, also, don't they, that on
bets that are laid off by the bookie — the big bets — why he doesn't share
50 percent?
Mr. FuRMAN. Wlien bets are laid off it is the total responsibility of
the house — the S. & G.
The Chairman. And the total profit and loss of the house?
Mr. FuRMAN. That is correct.
The Chairman. Then how about this wire service that $50 is de-
ducted for — the $50 a Aveek; is that a telephone to the bookie?
Mr. FuRMAN. I understand that to be a contractual arrangement
to compensate the S. & G. for the different facilities they extend to
them in connection with the wire service. j
The Chairman. Wliere does the wire service come from ?
Mr. FuRMAN. I do not know that.
The Chairman. Isn't $50 a week an awful lot of money for one littlei
telephone service ?
Mr. Furman. Well, if you are asking me to assume things I would
say that also includes the information of the morning line and the
approximate odds and this and that and the other thing — the com-
munications.
I'he Chairman. Does it include legal assistance or protection, oi
anything of that sort?
Mr. Fiirman. Not to my knowledge. I would say "No."
The Chairman. How about this $75 a week that is on the side, dcij
you know anything about that?
Mr. Furman. That $75 a week comes out of their 50-percent share
That is reimbursement for the administrative and other direct costs
The Chairman. You mean, there is $50 a week for wire service anc
what not ?
Mr. Furman. That comes off the top.
The Chairman. That comes off the top and out of the bookie'j
profit, out of his 50 percent he then pays $75 a week, too?
Mr. Furman. He pays a certain weekly allowance, whatever it maij
be as agreed upon bat ween the S. & G. and the individual spot.
The Chairman. What does that usually run to ?
Mr. Furman. I have been told that it runs anywhere from $40 t*
about $1()0 or something like that a week.
The Chairman. Why would there be the difference? Why woul^
you have that difference?
Mr. Furman. I suppose by contractual arrangement it depends 03
the volume or the estimate of the value of the spot.
The Chairman. Just what is that for?
Mr. Furman. That is for administrative expenses.
The Chairman. I mean, what is it though? I don't understaiii
Mr. Furman. Well, the way it was explained to me the syndicai
has its own employees and they have a large expense of operatin,
rent, and this and Ihat and the other thing so they charge the boo'
under the arrangement a certain amount per week as a service charj
The Chairman. You mean, to pay off his rent and employees in
office?
ORGANIZED CRIME IN INTERSTATE CX)MMERCE 443
Mr. FuRMAN. Sharing in the administrative expenses, that is the
way I nnderstand it to be.
The Chairman. Then what might result is S. & G. not have any
overhead at all and just let the bookies carry it?
Mr. FuRMAN. But it doesn't. The figures that I have seen and the
figures on the tax return show that it doesn't.
The Chairman. What does, rather, what did the $40 to $160 a week
amount to in 1948 ?
Mr. FuRMAN. Maybe Mr. Halley has that figure. It is not broken
down here.
Mr. Halley. What figure is it you w^ant?
Mr. FuRMAN. The question the Senator just asked.
The Chairman. This administration expense collected from the
bookie. I just wanted to know how much it amounted to in the year
1948.
Mr. Halley. You have to take their word for it.
Mr. FuRMAN. It is on the books.
Mr. Halley. It comes off the top.
^Ir. FuRMAN. No ; it does not.
The Chairman. It goes through the books ?
Mr. Furman. Sure it does.
The Chairman. Well, this Frenchy, ISIr. Gips was saying that was
on the side and Mr. Eosenbaum.
Mr. Furman. I doubt if that is so.
The Chairman. You think it goes right through the books?
Mr. Furman. I know definitely that the books reflect other income
as compensation for services rendered. That is the way it is explained
on the books.
The Chairman. Why don't they just put that in with the $50?
Why separate the two items ?
Mr. Furman. I don't know what the purpose of the management
in doing that is, but I can see the result of it.
The Chairman. What is the result? Is that the expense of the
wire service absorbed 50-50?
Mr. Furman. The result of it is that the expense of the wire service
is absorbed 50-50. The expense of this service charge is really carried
in its entirety by the bookie.
The Chairman. If you had 100 bookies out operating and $75 a
week say is the average administrative expense
Mr. Furman. I wouldn't say that.
The Chairman. Well, from $50 to $160 a week.
Mr. Furman. If I can refresh my recollection a moment maybe
I can recall that. Some years it wasn't charged. I remember that.
It was very small, but in the year 1948 — I don't know. Maybe it is
half this figure.
Tlie Chairman. Well, anyway let us say $75 a week is the average
and you had 100 bookies, that is $7,500 a week.
Mr. Furman. I never ran to more than $200,000. I think the biggest
figure I ever saw was $275,000, something like that.
The Chairman. Who are the present partners of the S. & G.
Syndicate ?
Mr. Furman. As of
The Chairman. As of the present time.
444 ORGANIZED CRIME! IN INTERSTATE COMMERCE
r
Mr. FuRMAN. As of the present time ?
The Chairman. Yes.
Mr. FuRMAN. Jules Levitt — I am reading from the tax return —
Charles Friedman, Harold Salvey, Sam Cohen, Ed Rosenbaum; that
is reflected on the 1948 tax return and I testified the other day that
the books indicated that Harry Russell became a partner in, I think
it was, March of 1949.
The Chairman. Harry Russell came in in March 1949?
Mr. FuRMAN. That is correct.
The Chairman. As a full partner ?
Mr. FuRMAN. He came in
The Chairman. I mean, is he an equal partner with the others ?
Mr. FuRMAN. I think he has a sixth now.
The Chairman. Where did he come from ?
Mr. Furman. I don't know.
The Chairman. Do you know the circumstances under which he
got in ?
Mr. Furman. I do not.
The Chairman. Do you know ?
Mr. Furman. I reiterate again. Senator, that I have had no con-
nection with the S. & G. until I was retained on this tax case pending.
The Chairman. Do the records that you have examined show
whether the wire service was cut off sometime early in 1949 ?
Mr. Furman. Senator, I did not examine and had nothing to do
with 1949 because that case is not pending before the Bureau ofl
Internal Revenue. The case pending— ^ —
The Chairman. Well, you said you saw some record about Mr.
Russell.
Mr. Furman. I saw a tax return for the calendar year 1949 and
it indicated there that in approximately March of 1949 he began
to participate in the operating results. I can further state that it
resulted in a loss on his share.
The Chairman. He is a newcomer to Miami Beach, isn't he?
Mr. Furman. So far as I know.
The Chairman, All those other people, all those other men are old
residents out here having been here a long time.
Mr. Furman. They appear to be.
The Chairman. They didn't need any new money to put into the(
operation, did they?
Mr. Furman. I do not know.
The Chairman. They are men of great means, you know that?
Mr. Furman. I don't
The Chairman. So they wouldn't be looking for new investors to
go in, would they?
Mr. Furman. I don't think so.
The Chairman. Can you imagine why they suddenly took in a new^
])artner ? Can you think of any reason ?
Mr. Furman. Senator, you are asking me to suppose something
which I cannot do.
The Chairman. I am asking you if they needed a new partner. I
am asking did they need financial assistance?
Mr. Furman. I would say the purpose of taking a new man in was
not for financial reasons, not from the financial standpoint.
ORGANIZED crime: IN nSTTERSTATE COMMERCE 445
The Chairman. And it wouldn't be from a technological stand-
jioint. These men know their business. They have been in it a long
time. They know how to operate it.
Mr. FuRMAN. They have been out there a number of years, the
records reflect that I examined.
The Chairman. Do you know when Harry Russell came to Miami
Beach ?
Mr. Furman. No, sir. Ihavenever seen the man. I wouldn't know
him if I saw him.
The Chairman. I believe that is all I have to ask.
Mr. FuEMAN. May I have all those records back now, Senator ? You
know this case is pending. I have a lot of work.
The Chairman. Well, sir, we will have some representative of the
committee in Miami for a few days and if you will agree to make the
original records available — we have a pretty good digest of what
your records are — in case they want to examine them.
Mr. Furman. Yes, I will be glad to make them available, to make
available all data that I have in my possession under the circumstances.
The Chairman. We don't want to inconvenience you in the prepara-
tion of your case, Mr. Furman, but we will ask your cooperation in
case there is any point they want to check.
Mr. Furman. Yes, sir.
The Chairman. But the records will be considered as exhibits to the
testimony with the right to include in the record any detailed informa-
tion the staff may present to the committee.
All right, Mr. Furman.
The committee will stand in recess until 2 o'clock this afternoon.
(Whereupon, at 1 p. m., a recess was taken until 2 o'clock.)
afternoon session
The Chairman. The committee will come to order.
Mr. O'Rourke, do you solemnly swear that the testimony you will
give this committee will be the whole truth and nothing but the
truth, so help you God ?
Mr. O'Rourke. Yes, sir.
The Chairman. I might saj' that the testimony of Mr. O'Rourke
was taken in executive session so that there are only a few points that
we are going into in this testimony today.
TESTIMONY OF JOHN F. O'ROUEKE, MIAMI, FLA.
Mr. Halley. We will not go over the ground that has previously
been covered. Mr. O'Rourke, you have heard the testimony of ]\Ir.
Schine?
Mr. O'Rourke. No, sir, I didn't hear it.
Mr. Halley. You did not hear the testimony of Mr. Schine ?
Mr. O'Rourke. No, sir. I wasn't here last night. I read it in the
papers.
Mr. Halley. Mr. Schine was asked about the circumstances under
which you rented the bookmaking privileges at the Boca Raton.
Perhaps it would be best if you started at the beginning and told
the committee the entire story about how you happened to rent
the bookmaking privileges at the Boca Raton.
446 ORGANIZED CRIME: IN INTERSTATE COMMERCE
Mr. O'RouRKE. Well, the bookmaking privilefjes were leased to me
by Mr. Schine for a sum. It came about that I believe I received a
call. I forget who made the call, whether it was the stenographer or
manager or who — I don't recall that — that Mr. Schine would like to
see me at the Boca Eaton. So I made a date with whoever called and
told him I would be there.
I don't remember if it was in the morning or afternoon. I believe
it was in the morning. I went down there to the Boca Raton. He
told me that he would like me to lease the concession at the Boca
Raton.
Mr. Halley. Wlio told you that ?
Mr. O'RouKKE. Mr. Schine.
Mr. Halley. Mr. Meyer Schine?
Mr. O'RouRKE. Yes, sir.
Mr. Halley. In person?
Mr. O'RouRKE. That is the only one I know. He said he would
like me to lease a concession at the Boca Raton and have a book there.
He explained why. He said the club was isolated down there and the
people had nothing to do but play golf and go to cabanas and it
probably would be something that his clientele would appreciate.
Mr. Halley. Did he call you or did you approach him on that?
Mr. O'RouRKE. He didn't call me, but someone from the hotel said
that Mr. Schine would like to see me.
Mr. Halley. Had you ever attempted to approach anybody in the
management of the Boca Raton about obtaining that concession?
Mr. O'RouRKE. No, sir. I didn't approach them. The summer
before that — I mean, in the summer — that happened in December if
I remember right, in the latter of 1946, another man who was connected
with Mr. Schine at that time — I don't know his capacity, but I don't
think he is in the hotel, I think he must be in real estate or something
there — approached me.
Mr. Halley. When?
Mr. O'RouRKE. During the summer. I don't know whether it was
in June or July.
Mr. Halley. You mean it was in the summer ?
Mr. O'RouRKE. Yes.
Mr. Halley. He approached you?
Mr. O'RouRKE. Yes, sir.
Mr. Halley. You didn't approach him?
Mr. O'RouRKE. No, sir.
Mr. Halley. What was the other man's name ?
Mr. O'RouRKE. Mr. Anderson.
Mr. Halley. What did he say ?
Mr. O'RouRKE. He asked me if I would be interested in the conces-
sion at the Boca Raton.
Mr. Halley. You were the man who was recognized as controlling
gambling in that county, weren't you?
Mr. O'RouRKE. I don't know, Mr. Halley, about controlling it.
Mr. Halley. You were "Mr. Big" in that county, weren't you ?
Mr. O'RouRKE. No, sir. That was just some publiicty, that's all.
Mr. Halley. Well, you had a pretty good finger in the pie, didn't
you?
Mr. O'RouRKE. Well, I don't know if you would call it a pretty
good finger in the pie. I had a pretty good reputation. Anyway, Mr.
ORGANIZED CRIME: IN USTTERSTATE COMMERCE 447
Anderson approached nie and I told him I was interested. So, on his
trip to New York he mentioned it to Mr. Schine, and then he got in
touch with me.
Mr. Halley. You are just guessing that he may have mentioned,
aien't you?
Mr. O'RouRKE. Well, I don't know about that.
Mr. Halley. You got a phone call and you went down to Mr.
Schine ?
Mr. O'RouRKE. That's right.
Mr. Halley. What did you say and what did Mr. Schine say?
Mr. O'KouRKE. He offered me the concessions down there, and we
talked about it, and this seemed like a concession that I would be un-
able to handle by myself; it was too big. I couldn't handle it just
by myself.
Mr. Halley. What happened ?
Mr. O'RouRKE. Well, we talked back and forth and tried to reach
some agreement, and I couldn't work out anything where I could
handle it, and he suggested that I see Mr. Erickson ; so I didn't know
Mr. Erickson and never had met him, and I asked him where Mr.
Erickson was, and he said, "You can probably locate him at the Roney
Plaza Hotel."
Mr. Halley. Had you never met Mr. Erickson before ?
Mr. O'RouRKE. No, sir; never had.
]Mr. Halley. And Mr. Schine was the one who approached you
about Erickson?
Mr. O'RouRKE. He said that maybe he would be interested in help-
ino; me carry the deal over, which was too much for me to handle.
Mr. Halley. Did you go to see Erickson ?
Mr. O'RouRKE. Yes.
< Mr. Halley. Where did you see Erickson ?
Mr. O'RouRKE. At the Roney Plaza Hotel.
Mr. Halley. Was he in a room at the Roney Plaza Hotel ?
r Mr. O'RouRKE. No, he wasn't.
Mr. Halley. Where was he?
- Mr. O'RouRKE. I met him down on the sidewalk and we walked into
that little tap bar, or something, there on the corner.
„■ Mr. Halley. Had you made an appointment to meet him on the
sidewalk there ?
/ Mr. O'RouEKE. Yes, I had.
Mr. Halley. How did you make that appointment ?
Mr. O'RotJRKE. I don't know if I called Erickson or I don't remem-
ber if they made the appointment. I might have called him myself.
Mr. Halley. Was Erickson expecting you?
- Mr. O'RouRKE. Yes, he was. We had a date.
Mr. Halley. He knew what you were coming to talk about ?
Mr. O'RoTJRKE. I imagine so. I don't know.
- Mr. Halley. In the conversation you had with him how did you
happen to bring it up ? Did you bring it up ?
Mr. O'RouKKE. I don't think I did; to be frank with you, I said,
"There's a proposition at the Boca Raton and it's too big for me to
handle." His comment was, "Go up there and see if you can make a
deal, and I'll go in with you."
Mr. Halley. Did he go in with you ?
448 ORGANIZED CRIME: in INTERSTATE COMMERCE
Mr. O'RouRKE. Yes ; he did.
Mr. Halley. On a 50-50 basis ?
Mr. O'RouRKE. Yes.
Mr. Halley. How long were you and Frank Erickson partners at
Boca Raton?
Mr. O^RouRKE. In 1947 and 1948 and a little part of 1949.
Mr, Halley. How much did you pay the hotel for the concession?
Mr. O'RouRKE. The hotel concession, if I remember correctly, for
the first year was around $10,000.
Mr. Halley. The second year ?
Mr. O'RouRKE. $20,000 to $22,500.
Mr. Halley. With whom did you negotiate the price?
Mr. O'RouRKE. Mr. Schine agreed on the price.
Mr. Halley. You talked price with Mr. Schine ?
Mr. O'RouRKE. Yes.
^Mr. Halley. Mr. Meyer Schine?
Mr. O'RouRKE. That's right.
Mr. Halley. On what occasion did you negotiate the price with
Mr. Schine personally ?
Mr. O'RouRKE. At Boca Raton ; I went back and told him — I said,
"We will take it for $5,000."
Mr. Halley. Did you tell him Erickson had agreed to go in ?
Mr. O'RouEKE. Yes.
Mr. Halley. There is no question in your mind that Mr. Schine
suggested Erickson?
Mr. O'RouRKE. That is the only man I talked to about the negotia-
tions,
Mr. Halley. You didn't suggest Erickson yourself?
Mr. O'RouRKE. No.
Mr. Halley. In fact you didn't want Mr. Erickson muscling into
your county particularly, did you?
Mr. O'RouRKE. Well, I think my reputation up there is all right. '
Mr. Halley. Your reputation is such that Mr. Erickson would
not be very apt to muscle in unless he was invited ?
Mr. O'Rourke. Of course, he was invited in at that time. He may
have been doing me a favor, too.
Mr. Halley. Who actually ran the concession, you or Erickson,
at the Boca Raton ?
Mr. O'Rourke. Well, I guess I had pretty good charge of it,
although I wasn't there.
Mr. Halley. Didn't you testify the last time that you were not
there and that it was actually operated by Erickson's employees?
Mr. O'Rourke. I said that he had men there.
Mr. Halley. They did the actual taking of the bets and dealing
with the people?
Mr. O'Rourke. Yes.
Mr. Halley. You said you were down there every day to see how
things were going?
Mr. O'Rourke. Not every day.
Mr. Halley. You didn't go eveiy day ?
Mr. O'Rourke. No; maybe once or twice a week; sometimes once a \
week.
I
ORGANIZED CRIME' IN INTERSTATE OOMME'RCE 449
Mr. Halley. a horse-betting establishment like that requires some-
one to be on the job to to run it, doesn't it?
Mr. O'RoTjRKE. Yes.
Mr. Halley. Who are the men who were actually on the job run-
ning the establishment at the Boca Raton?
Mr. O'RouRKE. I had two men down there ; a man by the name of
Russell •
Mr. Halley. What was his first name ?
Mr. O'RouRKE. I don't know that; they call him Red Russell. I
will have to get that off of the social security.
Mr. Halley. Was he one of Erickson's people ?
Mr. O'RouRKE. One of mine.
Mr. Halley. Who was the other one?
Mr. O'RouRKE. The other one was a fellow by the name of Caphart.
Mr. Halley. Was he your man ?
Mr. O'RouRKE. Yes.
Mr. Halley. Did Erickson have any men there?
Mr. O'RouRKE. Yes.
Mr. Halley. Who were Erickson's men ?
Mr. O'RouRKE. I believe a man by the name of Morro, an Italian
name.
Mr. Halley. Who else?
Mr. O'RotJRKE, I believe that is all.
Mr. Halley. When you went back to see Mr. Schine and after you
talked to Mr. Erickson, did you tell him that Erickson had agreed to
go into the deal?
Mr. O'RouRKE. I don't see how he could have kept from knowing.
Mr. Halley. Did you ever meet Erickson again ?
Mr. O'RouRKE. Yes; several times.
Mr. Halley. Where?
Mr. O'RouRKE. Sometimes he would be there.
Mr. Halley. You would go there and meet Erickson at the Boca
Raton ?
Mr. O'Rourke. Yes ; I have met him there.
Mr. Halley. Was Meyer Schine ever there when you met Erickson
at the Boca Raton ?
Mr. O'Rourke. No ; I don't believe so.
Mr. Halley. Did you have certain transactions with Mickey Cohen,
of California ?
Mr. O'Rourke. Yes.
Mr. Halley. Will you state just what those transactions were,
starting at the beginning and going right through ? You were operat-
ing a bookmaking establishement in West Palm Beach ?
Mr. Halley. Also a gambling house ?
Mr. O'Rourke. Yes.
Mr. Halley. Will you describe those operations?
Mr. O'Rourke. Well, to conduct the operation you just go in and
take bets.
Mr. Halley. Did you have telephones there?
Mr. O'Rourke. We ran without them for some time.
Mr. Halley. But at some time you did have telephones ?
Mr. O'Rourke. Several years ago.
Mr. Halley. How many phones ?
450 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. O'RouRKE. Two, I think.
Mr. Halley. Did you have wire service ?
Mr. O'RouRKE. Yes, sir.
Mr. Halley. You took bets from people at that establishment; is
that right?
Mr. O'RouEKE. Yes.
Mr. Halley. Where was it located ?
Mr. O'Rourke. In the Climatis Arcade.
Mr. Halley. Did you also have certain gambling games?
Mr. O'Rourke. Yes.
Mr. Halley. Did you have a card game ?
Mr. O'Rourke. Yes.
Mr. Halley. During this period did you have these transactions
with Mickey Cohen ?
Mr. O'Rourke. Yes.
Mr. Halley. I show you certain checks payable to the order of
Mickey Cohen, signed John F. O'Rourke, and ask you what they are,
and in the course of describing the checks, I will ask you to describe
each transaction with Mickey Cohen.
Mr. O'Rourke. These checks represent bets on horses.
Mr. Halley. Take one at a time and work through them and tell
the committee exactly what happened. First, how did you get in
contact with Mickey Cohen?
Mr. O'Rourke. He called me on the phone from Los Angeles and
asked me if I wanted to take any horse bets.
Mr. Halley. Will you go ahead with the conversation ?
Mr. O'Rourke. I told him I would take some horse bets from him,
so he bet me the horses.
Mr. Halley. You have never met Mickey Cohen ?
Mr. O'Rourke. Never in my life.
Mr. Halley. He just called you up and asked you if you would take
some bets ?
Mr. O'Rourke. Yes.
Mr. Halley. Did you agree to take the bets ?
Mr. O'Rourke. Yes.
Mr. Halley. Were there certain types of bets you said you wouldn't!
take?
Mr. O'Rourke. That is right.
Mr. Halley. Tell the committee about that.
Mr. O'Rourke. I wouldn't take any bets on California tracks.
Mr. Halley. Why not ?
Mr. O'Rourke. Because it was too far away.
Mr. Halley. You were not quite trusting about it either ?
Mr. O'Rourke. No ; because their post time is much later than ours.
Mr. Halley. In any event, you did take some bets on Florida races?
Mr. O'Rourke. Yes.
Mr. Halley. And what happened ?
Mr. O'Rourke. Some of them won and some of them lost.
Mr. Halley. Over how long a period ?
Mr. O'Rourke. I believe that relationship existed 5 or 6 months.
Mr. Halley. Did more of them win or did more of them lose?
Mr. O'Rourke. The results were that more of them won.
ORGANIZED CRIME: IN INTERSTATE COMMERCE 451
Mr. Halley. In fact, the whole deal was pretty disastrous to you,
wasn't it ?
Mr. O'RouRKE. That is right.
Mr. Halley. Were the bets numerous in the course of each day?
Mr. O'RouRKE. I would say, to the best of my recollection, that he
gave me anywhere from four or five bets to six or eight bets a day.
Mr. Halley. They all came in on the long-distance telephone ?
Mr. O'RouRKE. That is right.
Mr. Halley. From Mickey Cohen himself?
Mr. O'Rourke. Yes.
Mr. Halley. Would he call you directly ?
Mr. O'Rourke. Yes.
Mr. Halley. You took his word for it. If he said a bet was down,
it was down ?
Mr. O'Rourke. Yes.
Mr. Halley. There was never any disagreement about that?
Mr. O'Rourke. Never.
Mr. Halley. How did you settle up ?
Mr. O'Rourke. We had an arrangement to settle when it reached
around $5,000, whichever way the money would be due.
Mr. Halley. Did you settle every time one of you owed the other
$5,000?
Mr. O'Rourke. Somewhere around that figure.
Mr. Halley. Did you ever get to owe him $5,000 ?
Mr. O'Rourke. I owed him $5,000.
Mr. Hali.ey. Did he ever get to owe you $5,000 ?
Mr. O'Rourke. No.
Mr. Halley. He never did once get to owe you $5,000?
Mr. O'Rourke. No ; I got close to it. I was ahead of him several
times, but before we got to that figure he would catch up and get it
back.
Mr. Halley. In other words, he would balance off after each
day?
Mr. O'Rourke. Yes.
Mr. Halley. Will you describe the checks you have there and state
what they are and for how much ?
Mr. O'Rourke. This one is for $3,495.
Mr. Halley. What is the date on it ?
Mr. O'Rourke. October 17, 1947.
Mr. Halley. The next one.
Mr. O'Rourke. $10,000, October 17, 1947. The next one is Decem-
ber 3, 1947, $5,000; the next one is December 3, 1947, $4,855; the next
one is December 3, 1947, $5,000 ; the next one is March 18, 1948, $10,000 ;
the next one is March 30, 1948, $10,000 ; the next one is April 10, 1948,
$10,000; the next one is June 7, 1948, $5,000; the next one is July 3,
1948, $3,645; the next one is Julv 11, 1948, $3,000; the next one is
August 5, 1948, $5,000; the next one is June 16, 1948, $5,000; the next
one is November 1, 1948, $2,500 ; and the last one is November 15, 1948,
$2,500.
Mr. Hali^ey. Altogether how much did you lose to him ?
Mr. O'Rourke. Possibly around $50,000.
Mr. Halley. A little over $50,000?
Mr. O'Rourke. Yes.
452 ORGANIZED CRIMEI IN INTERSTATE COMMERCE
Mr. Hauley. In about 6 months.
Mr. O'RouRKE. Yes.
Mr. Hallet. After that you stopped dealing with him?
Mr. O'RouRKE. I had to quit.
Mr. Hallet. Thank you.
TESTIMONY OF WALTER CLARK, SHERIFF, BROWARB COUNTY,
FLA., ACCOMPANIED BY C. L. CHANCEY, ATTORNEY
The Chairman. Do you solemnly swear that the testimony you
are about to give to this committee will be the truth, the whole tiiith,
and nothing but the truth, so help you God ?
Mr. Clark. I do.
The Chairman. Sheriff, you are the sheriff of Broward County?
Mr. Clark. Yes, sir.
The Chairman. How old are you?
Mr. Clark. 46.
The Chairman. When were you elected sheriff of Broward County ?
Mr. Clark. I took office in January of 1933.
The Chairman. You have served almost constantly since that time ?
Mr. Clark. Yes.
The Chairman. Except during the length of time when you were
removed by Governor Holland?
Mr. Clark. I was suspended, not removed.
The Chairman. AA^ien was that?
Mr. Clark. I don't remember what year that was.
The Chairman. It was in about 1944, sometime in there ?
Mr. Clark. It was sometime in 1944.
The Chairman. Now, Sheriff Clark, let us get right down to the
point of our problem here. Up in Broward, in the south end of Brow-
ard County, you had operating during the season at various times the
Club Greenacres, Colonial Inn, the Club Boheme, and The Farm, and
I believe you testified that there were four or five operating in Brow-
ard County and have been for quite a number of years, is that right?
Mr. Clark. Four or five clubs, yes ; but not gambling places to my
knowledge. They are clubs.
The Chairman. You have never known that there was gambling
in those places ?
Mr. Clark. Rumors, but no actual evidence on it.
The Chairman. With all of the information around about those
places, why didn't you close them up, and what is the problem ?
Mr. Clark. I never had any kick on it. I never had any complaints
that they were gambling.
The Chairman. As a matter of fact, it has always been your policy
to operate on a liberal sort of basis, as you have told the connuittee.
Mr. Clark. Yes.
The Chairman. What do you mean by a liberal sort of basis ?
Mr. Clark. Well, I am not going around snooping in private busi-
nesses and homes.
The Chairman. If people want this gambling and want to operate
these places, it is their business so long as they don't bother somebody ;
is that what you mean?
ORGANIZED CRIME' IN INTERSTATE COMME'RCE 453
Mr. Clark. Unless it. is an order from the court or somebody comes
in and makes an affidavit.
The Chairman. Greenacres was operating during last season,
wasn't it?
, Mr. Clark. I believe the Greenacres was operating; yes.
The Chairman. Why didn't you close them up?
Mr. Clark. Nobody came in and made any affidavit or made any
complaint before the court.
The Chairman. When you ran for office on this so-called liberal
ticket what was said about the gambling operations ?
Mr. Clark.. My opponent and the newspapers said that there was
gambling going on in the county and had been going on.
The Chairman. What did you say about it ?
Mr. Clark. I didn't say anything about it.
The Chairman. Of course, you didn't say that you either would or
would not do anthing about it?
Mr. Clark. No.
. The Chairman. You knew Jake Lansky (Jack) who was operating
Greenacres and had operated Colonial Inn, didn't you ?
Mr. Clark. Yes.
• The Chairman. You were familiar with his record, that he had a
long record of arrests and convictions?
Mr. Clark. No ; I didn't.
' The Chairman. You didn't know that?
Mr. Clark. No, sir.
The Chairman. Did you know who his partners were. Erickson,
Costello, and many others who had been in these operations?
Mr. Clark. No, sir.
The Chairman. How often did you see Mr. Lansky ?
Mr. Clark. I have seen him at different times.
The Chairman. Sheriff, when these people would build a great big
building, a great big place like one of these clubs and decide to open
up, how did they get permission to do so ?
Mr. Clark. I don't know.
The Chairman. W^ould they get in touch with you ?
Mr. Clark. No.
The Chairman. You said here something about getting official
permission in your testimony before the committee, that they got
official permission to open up. Who did they get it from ?
Mr. ClxVRk. I don't remember saying anything about any official
permit.
The Chairman. I will come across that later. I noticed in your
testimony before that Mr. Halley asked you, "Did you or did you not
know gambling was going on ?" and you said, "Yes."
Mr. Clark. When we made the raids about the complaints on them
we arrested them.
The Chairman. Wlienever you went into places and made raids you
found gambling going on, is that right ?
Mr. Clark. What?
The Chairman. When you went in and looked around you found
that gambling was going on ?
Mr. Clark. Yes.
The Chairman. What raids did you ever make ? How many raids
on these places have you made during the past few years ?
454 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Clark. I don't recall. I will have to check up on that.
The Chairman. One, two, or, how many ?
Mr. Clark. I guess my officers made more than that.
The Chairman. To your knowledge how many raids have you ever
made, you or your officers on Greenacres, Colonial Inn, or the Farm ?
Mr. Clark. I couldn't say. I don't remember.
The Chairman. You just don't remember?
Mr. Clark. No.
The Chairman. Do you know Jake Lansky ?
Mr. Clark. Yes.
The Chairman. Do you know Meyer Lansky ?
Mr. Clark. No.
The Chairman. How long have you known Jake Lansky ?
Mr. Clark. He has been living in Hollywood there 12 or 15 years.
The Chairman. You knew that he was operating these places up
there in Broward County, is that correct ?
Mr. Clark. I knew that he was operating these places, yes ; clubs.
The Chairman. You knew that he was running these places up
there ?
Mr. Clark. Yes.
The Chairman. Did Jake Lansky and the various operators of these
places contribute to your campaign for sheriff ?
Mr. Clark. I couldn't say whether they did or not.
The Chairman. You don't know? Did the boys in the south end
handle that end of the campaign ?
Mr. Clark. Some of it. I know that I had people working down
there. The people were working down there but I didn't pay them to
work for us.
The Chairman. Do you know whether they got money from the
Lanskys and the operators of these places?
Mr. Clark. Mr. Lansky told me that he was going to do all that
he could for me down there.
The Chairman. And you understood that he did do that ?
Mr. Clark. Yes.
The Chairman. And you know that he contributed a substantial
amount to your campaign for sheriff?
Mr. Clark. I don't know what he contributed.
The Chairman. Anyway, he did contribute ?
Mr. Clark. He said he would do what he could and he hired some
workers.
The Chairman. Your brother Robert handled the south end of
the county largely, didn't he?
Mr. Clark. I don't know what you mean by handling the south
end.
The Chairman. I mean, he looked after the campaign down in that
end?
Mr. Clark. He worked down there; yes.
The Chairman. How about Claude Litteral ? Did he handle part
of your campaign in the south end?
Mr. Clark. I don't know.
The Chairman. Do you know whether he was in your campaign or
not; did you ask him to make any solicitation of the Lanskys and the
other people operating these clubs?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 455
Mr. Ci.ARK. No; T did not.
The Chairman. Was he in your campaign'^
Mr. Clakk. He was for me ; he lielped me.
The Chairman. Did he collect money for you 'i
Mr. Clark. 1 don't know.
The Chairman. Did you keep any record of who collected money
for you ?
Mr. Clark. I guess the campaign expenses filed with the clerk up
there would show how much was contributed and who contributed it.
The Chairman. Wasn't he designated by you to make campaign
collections and to look after your campaign, along with your brother,
in the south end of the county ?
Mr. Clark. Not by me.
The Chairman. Was he designated by someone running your cam-
paign ?
Mr. Clark. I don't know.
The Chairman. Did he do that in your behalf?
Mr. Clark. I couldn't say ; I don't know.
The Chairman. You do know that he collected money from these
people ?
Mr. Clark. No ; I don't know tliat.
The Chairman. Have you looked into it to find out whether he
did or not ?
Mr. Clark. No.
The Chairman. Sheriff, these clubs are large expensive buildings
with attractive furnishings in them where this gambling goes on,
are they not ? Large substantial buildings. Do you think any person
would put an investment in a building like that unless he thought he
would be able to operate ?
Mr, Clark. I don't know. There are several big restaurant clubs
up there on the liighway, and I know that we go in there to eat stuff
and I never saw any gambling there. I don't know whether they are
gambling or not.
The Chairman. Who do these people see when they want to open
up gambling places, open up these clubs ?
Mr. Clark. I don't know.
The Chairman. How often does Lansky see you or how often do you
see him ?
Mr. Clark. I just see him on the street occasionally.
The Chairman. Did you talk with him about what sort of opera-
tion he has there?
Mr. Clark. No.
The Chairman. Can you remember any one time that you ever
raided any of these places, that you as sheriff of Broward County
ever raided?
Mr. Chancet. I would like for the chairman to explain to the wit-
ness and to me as his attorney what you mean by a raid.
The Chairman, Whether he went down and made arrests and pad-
locked places.
Mr. Chancet. The statutes of the State of Florida govern the activ-
ities of the sheriff of a county. Now, if you have reference to some
statute that he did or did not comply with, that is one thing, but if
you have reference to some unauthorized entry, illegal entry, that is
68958— 50— pt. 1 30
456 ORGANIZED CRIME' IN INTERSTATE COMMERCE
a different thing, and I think we should have the record clear on that.
The Chairman. I am not talking about raiding them for any pur-
pose except law enforcement, Mr. Chancey, under the statute.
Mr. Chancey. There is nothing in the statute that permits the
sheriff of Broward County to make a raid except on
The Chairman. The statute has been offered in the record to estab-
lish the law of gambling in the State of Florida, and we have those
statutes before us.
Mr. Chancey. All right.
The Chairman. Are slot machines legal in Broward County or
in the State of Florida?
Mr. Clark. No, sir.
The Chairman. Are there a lot of slot machines in Broward
County ?
Mr. Clark. Not that I know of.
The Chairman. You have not seen them there?
Mr. Clark. No.
The Chairman. You dom't know of any siot machines in the
county ?
Mr. Clark. I don't.
The Chairman. Sheriff, haven't you been in the slot machine busi-
ness yourself ?
Mr. Clark. No.
The Chairman. Never?
Mr. Clark. No.
The Chairman. In the coin machine or amusement machine busi-
ness?
Mr. Clark. No. Music boxes and cigarette machines.
The Chairman. Not slot machines, one-armed bandits?
Mr. Clark. No.
The Chairman. Tell us what pieces of property you own, sheriff.
You own the home you live in?
Mr. Clark. Yes. I am interested in a garage.
The Chairman. Let us get it down here. You own the home that
you live in ?
Mr. Clark. Yes.
The Chairman. Where is that in Broward County?
Mr. Clark. 828 Southeast Fourth Street.
The Chairman. Do you own a farm?
Mr. Clark. Yes.
The Chairman. Where is that and how large is it?
Mr. Clark. About 200 acres.
The Chairman. You said you paid $25,000 or $30,000 for it, or
something like that.
Mr. Clark. For the farm?
The Chairman. Yes.
Mr. Clark. No, sir. For the farm I paid $16 an acre.
The Chairman. You had 200 acres, which is about $3,200?
Mr. Clark. Right.
The Chairman. What else do you have, Sheriff?
Mr. Clark. I have some scattered lots and land. I am interested in
a filling station and I own a garage building.
The Chairman. You and your brother operate a filling station and
garage building together?
ORGAIS'IZED CRIME' IN INTERSTATE COMMENCE 457
Mr. Clark. Yes.
The Chairman. YoUr brother Robert?
Mr. Clark. Yes.
The Chairman. That is what you said you paid around $30,000
for it.
Mr. Cl.\rk. Yes.
The Chairman. What is the Ribbonwriter Co. ?
Mr. Clark. It is a company that was started to make attachments
for typewriters.
The Chairman. How much investment do you have in that; how
much stock did you buy ?
Mr. Clark. 1 don't know. I would have to check to see how much
I did put in there.
The Chairman. What is your best judgment about it? Do you own
lialf an interest in that company, or how much ?
Mr. Clark. No, sir.
f The Chairman. How much did you pay for your interest in it?
Mr. Clark. I will have to check on that. I think it was about $25,000.
The Chairman. How much was the total business worth when you
bought your interest ?
Mr. Clark. I don't know. Some of the stock in there was put in
my name, but it went to my brother, Robert.
The Chairman. That business went out of operation some time ago,
I understand.
Mr. Clark. Yes.
The Chairman. I think, in fairness to you, Sheriff Clark, to clear
up the record, I should tell you that it has been stated that you had
an interest in it and that you were a friend of the president, and that
the company got an RFC loan, and there was some inference that you
used some influence in order to get the loan from the RFC.
Mr. Chancet. May I inquire what materiality that has?
The Chairman. It is material for this reason : I think the sheriff
should make some explanation about it as to whether he was trying
to use any influence. We just want to get the facts on the matter.
Mr, Chancey. That is a legitimate business, and it had a right to
get a loan from a Government agency.
The Chairman. If the sheriff doesn't want to answer that question,
all right. I thought, in deference to the sheriff himself, that he might
want to make some explanation about it.
Mr. Chancet. I think it is immaterial to this inquiry.
The Chairman. The sheriff stated in the paper that he didn't know
anything about it himself, and I just thought that there might be some
facts about it as to which he might wish to testify.
Mr. Chancet. We would prefer not to discuss that.
The Chairman. Did you use any official influence to try to get an
RFC loan ?
Mr. Clark. I did not.
The Chairman. Now, sheriff, when we questioned you before we
asked you about your property and what you had you said that you
had a home and a farm and an interest in a garage and filling station
with your brother, and then you were asked about the Ribbonwriter
Co., and then you were asked a question about any other property that
you owned. Now, sheriff, do you want to make any addition to your
previous statement ?
458 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Clark. There may be some little pieces of property that I own.
The Chairman. What do you mean by little pieces of property;:
what kind of property ?
Mr. Clark. Little scattered pieces of land. There may be a few
lots that didn't <ret in there. If the committee wants it, I have a record
of all of my property.
The Chairman. iSnppose you tell us what you have in addition to
what you told us about the last time.
Mr. Clark. I own a little piece of acreage there in the edge of Fort
Lauderdale.
The Chairman. Outside of little lots around that you have been
talking about, what else?
Mr. Clark. My brother and I own a little acreage up there in Duval
County.
The Chairman. How big an acreage ?
Mr. Clark. I don't know positively.
The Chairman. Is it valuable, or how much is it worth ?
Mr. Clark. I don't know what it is worth now. I have a mortgage
on it for $2,500 or $3,000, or something like that.
The Chairman. What else, while we are on the subject? Tell us
what you and your brother have an interest in in addition to what
you have already told the committee.
Mr. Clark. I have got a little piece of land out in the glades in
Broward County. It is out on Road 84 in the county.
The Chairman. What kind of land is that ?
Mr. Clark. It is just raw muck land.
The Chairman. What do you think that is worth ?
Mr. Clark. Today I guess it is worth $o0 an acre.
The Chairman. What other property or business do you own ?
Mr. Clark. That is not what I paid for it.
The Chairman. You paid less than that for it?
Mr. Clark. Yes. In fact, I bought it on tax certificates.
The Chairman. What else, sherili'; anything else?
Mr. Clark. That is all I can think of. There might possibly be
some more.
The Chairman. If you had any substantial investment in addition
to that you would remember, wouldn't you ?
Mr. Clark. We have our homestead place there.
The Chairman. That is where you live?
Mr. Clark. No.
The Chairman. That is your homestead place that you and your
brother own?
Mr. Clark. Me and my brothers ; yes.
The Chairman. How many brothers do you have ?
Mr. Clark. Three.
The Chairman. That is owned by the three of you ?
Mr. Clark. Yes.
The Chairman. Anything else ?
Mr. Clark. Not that I can think of right now.
The Chairman. What ,you have recited is a little bit more than
you said you owned when you appeared before the connnittee before.
Do you own any otlier substantial pieces of property or businesses
in addition to what you have testified to now ?
Mr. Clark. No, sir.
ORGANIZED CRIME IN INTERSTATE OOMME'RCE 459
The Chairman. You have no others ?
Mr. Clark. I am trying to think.
The Chairman. Think hard.
Mr, Clark. No other substantial business ; no, sir.
The Chairman. How about small businesses, such as partnership
interests or corporations?
Mr. Chancey. Senator, do you have something in mind?
The Chairman. No; I am just trying to get the sheriff to tell what
businesses he was in, whether he made money out of it, and what his
sources of income were.
How about the Broward Amusement Co. ?
Mr. Clark. That I mentioned a little while ago.
The Chairman. That was mentioned a while ago?
Mr. Clark. Yes; about the music machines and cigarette machines.
The Chairman. Do you own any interest in it ? It is not now the
JBroward Amusement Co. It is now another company, isn't it?
Mr. Clark. The Broward Novelty Co.
The Chairman. Why didn't you tell us about it ?
Mr. Clark. I mentioned about the amusement company, with the
music machines and the cigarette machines.
The Chairman. You didn't say anything about that the last time
;you testified, did you?
(No response.)
The Chairman. That is a pretty big operation, isn't it?
Mr. Clark. Yes, sir.
The Chairman. In fact, that is the principal source of your income ?
Mr. Clark. Yes, sir.
The Chairman. And it has been over a period of many, many
years ?
Mr. Clark. Yes, sir.
The Chairman. Sheriff, when was the Broward Amusement C&
formed ?
Mr. Clark. I don't remember.
The Chairman. Was it in 1945?
(No response.)
The Chairman. Wasn't H. J. McLean one of your partners in the
Broward Amusement Co.?
Mr. Clark. No, sir.
The Chairman. Was he when it was formed in 1945 ?
(No response.)
The Chairman. Tell us about it. Sheriff.
Mr. Clark. I don't remember.
The Chairman. Was Robert Clark one of the partners in the
Broward Amusement Co.?
Mr. Clark. Bob was.
The Chairman. And Gordon F. Williams ? Was he one of them ?
Mr. Clark. Yes, sir.
The Chairman. For what purpose was the Broward Amusement
Co. formed ? What was the business of the Broward Amusement Co. ?
Mr. Clark. Cigarette machines and music machines; music boxes.
The Chairman. Did you operate any games ?
Mr. Clark. Not that I know of, sir.
The Chairman. Not that you know of?
460 ORGANIZED CRIME! in INTERSTATE COMMERCE
Mr. Clark. No.
The Chairman. Did you have any slot machines ?
Mr. Clark. Not that I know of.
The Chairman. Any bolita games?
Mr. Clark. Not tliat I know of.
The Chairman. Did yon operate it ?
Mr. Clark. I don't know.
The Chairman. Who operated the company?
Mr. Clark. Gordon Williams.
The Chairman. I believe in the beginning McLean and Williams
each got a third and you and your brother Bob divided the other
third; is that correct?
Mr. Clark. I guess so. I didn't run the business.
The Chairman, Is that a corporation or a partnership?
Mr. Clark. I don't know whether it is incorporated or a partner-
ship.
The Chairman. Sheriff, you ought to know that ; which it is. Is it
a partnership or a corporation ?
(No response.)
The Chairman. Sheriff, in 1945, you got $12,910.88 net out of this
partnership or corporation, didn't you ?
Mr. Clark. I will have to look back at the records to see. I don't
know.
The Chairman. Didn't you examine the records recently to check?
Mr. Clark. No, sir ; I have not.
The Chairman. Do you have a copy of your income-tax return ?
Mr. Clark. No, sir.
The Chairman. You wouldn't be surprised if you got $12,910.88
out of it, would you ?
Mr. Clark. No, sir.
• The Chairman. Do you think that is about right ?
Mr. Clark. It could be. I don't know.
The Chairman. Did your brother get the same amount?
Mr. Clark. Yes.
The Chairman. Anyway, Sheriff, your income-tax return shows
that you had bolita sales of $252,735— tell what that was?
Mr. Clark. I don't know.
The Chairman. What is bolita, Sheriff?
Mr. Clark. I never exactly understood. Bolita is a game that
niggers play.
The Chairman. It comes from Cuba, doesn't it?
Mr. Clark. Yes, sir.
The Chairman. Tell us how they play it?
Mr. Clark. I don't know.
The Chairman. Do you really mean you don't know how it is
played ?
Mr. Clark. No, sir.
The Chairman. Isn't there something about having 100 balls and
they put the balls in a sack and somebody picks 1 ball after shaking
the sack around ?
Mr. Clark. I never saw it played. I don't know.
The Chairman. Now do you think your return here would show
bolita sales above $300,000 ?
ORGANIZED CRIME: in INTERSTATE COMMERCE 461
Mr. Chancey. Mr. Chairman, would you mind explaining to the
witness whether this is his, his corporation's, or his partnership's
return ?
The Chairman. It is the partnership's.
Taking the period 1945^6, you said the bolita sales ran $321,000,
and they grossed $30,000. You don't know anything about that op-
eration ?
Mr. Clark. No, sir.
The Chairman. Or $780,000 in 1947 ? What was this coin-machine
operation in the same partnership — sales — and then you have "loca-
tion"? Were they rented out and the location got so much back or
how did that work ?
Mr. Clark. I don't know anything about that. The only connection
I had was with the music machines and the cigarette machines.
The Chairman. For instance, the music machines and the cigarette
machines would be placed somewhere and out of the total take the
person there would keep a cei'tain amount of it?
Mr. Clark. I don't know. I didn't operate the business. I don't
know.
The Chairman. Would it surprise you if the sales on the coin
machines was in excess of $84,000. of which the location got $37,000
and the gross profit was $47,000. AVould that be a good estimate of
the size of the business in 1945 ?
Mr. Clark. I don't know.
The Chairman. Who could tell us about these operations?
Mr. Clark. I think Mr. Williams could tell you.
The Chairman, When you testified before us on May 27 and we
tried to get you to tell us what businesses you had had, you went into
some detail about the land and the filling station and the garage. Why
didn't you tell us about this very substantial business ?
Mr. Clark. I never thought about it at that time.
The Chairman. But over a period of years this had been by far your
chief source of income ; isn't that right ? The amount you get out of
being sheriff is inconsequential as compared with this big business.
Mr, Clark. I never looked at the records to see.
The Chairman, You must know which you get most of the money
out of without going into details about it.
If I should give you aj^parently your share of the income from this
enterprise, would vou know whether this was about right or not? For
the year 1946, $16,000; 1947, it seems to be $4,000. That has been
corrected since then, hasn't it?
Mr. Clark. I don't know.
The Chairman. Sheriff, what is your record of income from these
businesses for 1947 and 1948, from all of your operations?
Mr. Clark, I can't tell. I don't know. I would have to look it up
and see.
The Chairman. Would it be $35,000, $40,000, or $50,000?
Mr. Clark. I couldn't say that.
The Chairman. Is playing bolita in violation of the law?
Mr. Clark, Bolita games?
' The Chaiioian, The game bolita?
- Mr. Clark. Yes, sir.
The Chairman. It is a violation ?
462 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Clark. Yes, sir.
The Chairman. Do you know whether any of it is carried on in
Broward County?
Mr. Clark. I don't know.
The Chairman. You haven't seen any of it ?
Mr. Clark. No, sir ; I haven't.
The Chairman. Sheriff, I asked you some time back about people
who wanted to open up places like Greenacres and the Colonial Inn,
and I refer to the previous testimony which I find in this record here
and here is what it was and I will ask you if this is true :
The Chairman. Suppose one of these fellows wants to set up a place like
Greenacres or the Colonial Inn or an operation of that kind, do they come and
get in touch with you or one of your representatives to make arrangements
about it?
Mr. Clark. They usually go to the oflBcial — they don't make arrangements.
The Chairman. You say they get some officials?
Mr. Clark. I mean, the city wants it liberal.
Is that your testimony ?
Mr. Clark. AVhat I meant was leave it up to the city. I don't inter-
fere with the police department in the cities. Unless a complaint
comes out of there to me, I don't go around snooping around to see
what is going on.
The Chairman. Do they get some official permit to open up or not ^
Do they see somebody and make arrangements about opening up ?
Mr. Clark. Not that I know of.
The Chairman. So you don't know who they get in touch with ?
Mr. Clark. No, sir. I don't know if they get in touch with any-
body.
The Chairman. Except for the last 5 or 6 months, there has been
pretty much the same amount of operations of these clubs and re-
putedly gambling places over a period of 10 or 12 years, or a good
many years ? That is, it is not any larger amount 1 year much than
in another? They have operated right on through, haven't they?
Have some of them operated every season ?
Mr. Clark. Some of them are still operating every season. You
see the advertisements in the paper that they are open.
Mr. Halley, Do you know Harry Sullivan ?
Mr. Clark. Yes, sir.
Mr. Halley. Have you ever been in business with Harry Sullivan ?
Mr. Clark. Yes, sir.
Mr. Halley. What business?
Mr. Clark. Garage business.
Mr. Halley. Where?
Mr. Clark. Fort Lauderdale.
]Mr. Halley. Wliat was the name of the business?
Mr. Clark. Hudson-Dell Motor Co., I think.
Mr. Halley. Who else was in that business ?
Mr. Clark. My brother.
Mr. Halley. Which brother?
Mr. Clark. Bob.
Mr. Halley. Plow much money did you and your brother put into
that business?
Mr. Clark. I don't know, I would have to look at the records and
see.
ORGANIZED CRIME IN INTERSTATE COAIMERCE 463
Mr. Halley. Could it liave been as much as $35,000 ?
Mr. Clark. I expect it was somewhere around that.
Mr. PIalley. ^Vliere did you get all that money ?
Mr. Clark. Different sources; savings.
Mr. Halley. Savings?
Mr. Clark. Yes, sir.
Mr. Halley. You save $5 and $10 bills, or did you collect them ?
Mr. Clark. I saved money.
Mr. Halley. Well, if Harry Sullivan had stated that when bills
came in for construction work, he would go over to your office and
pick up cash in $5 and $10 bills, would that be true ?
Mr. Clark. Yes, sir ; I expect it is.
' Mr. Halley. So you put a great deal of your $35,000 in the form
-of $5 and $10 bills?
Mr. Clark. I didn't put all the $35,000 in.
Mr. Halley. Wlio did ?
Mr. Clark. My brother and I did, together.
Mr. Halley. How did he get his part of the $35,000 ?
Mr. Clark. I guess he made it on different investments.
Mr. Halley. What is his business?
Mr. Clark. I don't know what all businesses he is in. He has
different investments.
Mr. Halley. For instance? How did he get to be a man of sub-
stance ?
Mr. Clark. I know he bought some property and sold it and made
some investments and made a profit.
Mr. Halley. Do you and your brother have any businesses that you
haven't told us about yet ?
Mr. Clark. No, sir.
Mr. Halley. Who owns the Trammell Motors ?
Mr. Clark. I don't know.
Mr. Halley. Did you ever hear of Trammell Motors ?
Mr. Clark. Yes, sir.
Mr. Halley. Do you have any interest in it ?
Mr. Clark. No.
Mr. Halley. Does your brother ?
Mr. Clark. Not that I know of.
Mr. Halley. Who owns the Lincoln-Mercury shop ?
Mr. Clark. That is the garage we own.
Mr. Halley. That is the garage you own ?
Mr. Clark. Yes, sir.
Mr. Halley. Is that the same garage as Hudson-Dell ?
Mr. Clark. Yes.
Mr. Halley. You have the Lincoln-Mercury and Hudson in the
same garage ?
Mr. Clark. No ; we gave up the Hudson agency, and we leased the
garage to Lincoln-Mercury.
Mr. Halley. Where is that located ?
Mr. Clark. On Federal Highway.
Mr. Halley. Is that the same place where you had the Hudson-Dell
agency ?
Mr. Clark. Yes.
Mr. Halley. Is that the one you paid $35,000 for?
464 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Clark. I couldn't say exactly what it did cost.
Mr. Halley. Are you familiar with the real-estate situation in the
northeast section of Fort Lauderdale ?
Mr. Clark. Yes, sir.
Mr. Halley. Did you ever go into any housing construction in that
area?
Mr. Clark. No, sir ; I didn't.
Mr. Halley. Did you ever know anybody who did, who built two
blocks of houses?
Mr. Clark. I don't know who they are in northeast.
Mr. Halley. You know several people who built houses?
Mr. Clark. Yes, sir.
Mr. Halley. Were you familiar with some people who built two
blocks of houses in the northeast section right after you finished with
the Ribbonwriter transaction?
Mr. Clark. I do not.
Mr. Halley. Didn't you put some money in another name for
building construction in northeast ?
Mr. Clark. I did not.
Mr. Halley. You and your brother ?
Mr. Clark. No, sir; I did not.
Mr. Halley. Did your brother?
Mr. Clark. I couldn't say.
Mr. Halley. I am referring to some houses near the park.
Mr. Clark. I know I didn't.
Mr. Halley. Do you know whether your brother did ?
Mr. Clark. I couldn't say.
Mr. Halley. Not under your own name ?
Mr. Clark. Not under my name or anybody else's name.
Mr. Halley. You are sure of that ?
Mr. Clark. Yes, sir.
Mr. Halley. Will you stand on that ?
Mr. Clark. Yes, sir.
Mr. Halley. Now, have you finally told the committee all of your
business operations ?
Mr. Clark. Maybe I would buy a car and sell it ; little things like-
that. Maybe I would pick up different items here and there and sell
them and make a little profit on them.
Mr. Halley. Did you ever get campaign contributions from any of
these gamblers?
Mr. Clark. Not personally ; no, sir.
Mr. Halley. Who did get them for you from the gamblers ?
Mr. Clark. I don't know.
Mr. Halley. Didn't Claude Litteral collect for you?
Mr. Clark. Not to my knowledge.
Mr. Halley. Didn't he ?
Mr. Clark. Never gave it to me.
Mr. Halley. Did Lansky collect for you ?
Mr. Clark, Never gave me any.
Mr. Halley. Never gave you any ?
Mr. Clark. No, sir.
Mr. Halley. Mr. Clark, was Claude Litteral a partner in the
Plantation which later became the Club Boheme^
ORGANIZED CRIME' IN INTERSTATE COMMERCE 465
Mr. Clark. I don't know.
Mr. Halley. You know he was down there and operating it or had
part of the operation, didn't you ?
The Chairman. He was at the Plantation when he was operating
at the Plantation?
Mr. Clark. I don't know. I believe he did.
The Chairman. You think he did ?
Mr. Clark. Yes, sir.
Mr. Halley. Is he the same man that has been referred to as help-
ing you in your campaign ? Is that the same Claude Litteral. Did he
help out Herbei't L. Vaughan? Do you know Mr. Vaughan?
Mr. Clark. Yes, sir.
Mr. Halley. Didn't they operate the Plantation for quite a while?
Mr. Clark. Yes, I think they did ; yes.
The Chairman. Didn't they sell it out to somebody else or in some
way the management changed and Joe Doto or Joe Adonis came into
the Club Boheme ?
Mr. Clark. I don't know.
The Chairman. You know Joe Adonis, don't you ?
Mr. Clark. No, sir.
The Chairman. Didn't you know that Joe Adonis was in that op-
eration a while ?
Mr. Clark. No ; I did not.
The Chairman. When did you ever hear of Joe Doto or Joe Adonis ?
Mr. Clark. I heard his name mentioned in the newspapers.
The Chairman. He never conducted any operation in Broward
County ?
Mr. Clark. No, sir.
The Chairman. There is one thing I intended to ask you by way
of income. What is this "special policing"? What is this special
policing that you do ?
Mr. Clark. We furnished special police for different occasions.
The Chairman. How do you get any income out of that ?
Mr. Clark. They pay us.
The Chairman. They pay you $2,000 a year?
Mr. Clark. Something like that.
The Chairman. Who does that ?
Mr. Clark. Different people who we police for.
The Chairman. How about the Club Boheme or Greenacres? Do
you furnish police there?
Mr. Clark. No, sir.
The Chairman. That is not part of the special policing?
Mr. Clark. No, sir.
The Chairman. How much have you averaged on special policing
a year ?
Mr. Clark. I couldn't say.
The Chairman. Would it be around $2,000 a year ?
Mr. Clark. I expect so.
The Chairman. Is that some of the large estates that pay addi-
tional amounts, or can you specify ?
Mr. Clark. It is the estates and stuff like that.
The Chairman. What do you do for that $2,000 a year? Do you
^et men up and send them around ?
Mr. Clark. Yes, sir.
466 ORGANIZED CRIME: IN INTERSTATE COMMERCE
The Chaieman. Who pays them ?
Mr. Clark. The people do.
The Chairman. The people do ?
Mr. Clark. Yes, sir.
The Chairman. And they pay you something also for getting
them up?
Mr. Clark. Yes.
The Chairman. Are they people that are in Broward County ?
Mr. Clark. Yes, sir.
The Chairman. The testimony shows fairly well that these bank-
rolls that these places have — do you know what the bankroll is that
they keep all during the season and divide up? That is not usually
put in the bank, but you have a special armored police car they keep
it in overnight and get it out the next day. Do you furnish any
policing for these special armored trucks ?
Mr. Clark. I deputize the men that run the armored trucks.
The Chairman. You deputize them. Who pays their salary ?
Mr. Clark, The armored truck company does.
The Chairman. Who owns the armored truck service?
Mr. Clark. Harry Gross.
The Chairman. Do you have an interest in it ?
Mr. Clark. No, sir.
The Chairman. Does your brother ?
Mr. Clark. I don't know if he does now or not.
The Chairman. He did not have an interest in it for quite a while?
Mr. Clark. I think he had an interest one time.
The Chairman. Where is that armored truck company?
Mr. Clark. Fort Lauderdale.
The Chairman. Didn't he operate it for quite a while?
Mr. Clark. I don't know.
The Chairman. Wasn't he the chief operator?
Mr. Clark. I don't know. I don't think so.
The Chairman. Anyway, he was interested?
Mr. Clark. Yes, sir.
The Chairman. How many of these armored trucks are there ?
Mr. Clark. I couldn't say.
The Chairman. When these people come to you and get deputized
somebody would have to ask you to deputize those people to operate
those trucks?
Mr. Clark. Yes, sir.
The Chairman. Who would ask you to deputize them ?
Mr. Clark. Harry Gross.
The Chairman. Do you know what they were going to be used for ?
Mr. Clark. He was operating the armored trucks.
The Chairman. Do you know what the armored truck was for?'
Fort Lauderdale is a lovely town, but it has good banks up there and'
people don't just use armored trucks. Do you know what these par-
ticular armored trucks were to be used for?
Mr. Clark. Hauling money.
The Chairman. Hauling money from where?
Mr. Clark. From the bank and different places of business.
The Chairman. Do you know they were going to be used to keep
the money of these night clubs and gambling places overnight in these
armored trucks?
ORGANIZED CRIME: EST ESTTERSTATE COMMERCE 467
Mr. Clark. I never asked where tliey were hauling to.
The Chairman. You never inquired what they were going to use
them for?
Mr. Clark. No, sir.
The Chairman. All right.
Mr. Halley. Sheriff, did I hear you right a while ago when you said
that the gamblers did not contribute to your campaign?
Mr. Clark. I said I didn't know.
Mr. Halley. You knew the last time you testified here, didn't you ?
Mr. Clark. I said they contributed the workers, not to me.
Mr. Halley. It was your campaign we were talking about.
Mr. Clark. Yes.
Mr. Halley. What did you testify to the last time?
Mr. Clark. They told me that they were going to help me in the
south end.
Mr. Halley. Who told you that they were going to help you out?
Mr. Clark. Mr. Lansky.
Mr. Halley. Mr. Lansky told you he was going to help you out?
Mr. Clark. He was.
Mr. Halley. Mr. Lansky is a gambler ?
Mr. Clark. Yes.
Mr. Halley. He runs Greenacres ?
Mr. Clark. No.
Mr. Halley. Does he run Club Boheme ?
Mr. Clark. Yes, sir.
Mr. Halley. And Club Boheme is a gambling joint, isn't it ?
Mr. Clark. Yes ; I guess so.
Mr. Halley. Let's not play cat and mouse. You know it is a gamb-
ling place, don't you ?
Mr. Clark. No.
Mr. Halley. You admitted the last time you went in and raided the
place.
The Chairman. I think he said on one occassion he did go down
there.
Mr. Chancey. And he said there was no gambling going on there.
Mr. Halley. You testified here sometime back, did you ?
Mr. Clark. Yes, sir.
Mr. Halley. Do you remember that after you left the hearing room
you asked for permission to come on back ?
Mr. Clark. Yes, sir.
Mr. Halley. And that was after you testified that you didn't know
there was any gambling going on and hadn't been in these places when
there was gambling going on ?
Mr. Clark. That is right.
Mr. Halley. And then you left and then you said you would like
to come back and change your statement?
Mr. Clark. I said we made a raid on one of those places. 1 happened
to remember it. I happened to be in on the raid.
Mr. Halley. ^Yliich one did you raid ?
Mr. Clark. Greenacres.
Mr. Halley. Did you find some gambling ?
Mr. Clark. Yes, sir.
Mr. Halley. And you closed them up ?
468 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Clark, We laid a charge against them.
Mr. Halley. And they were closed ?
Mr. Clark. Yes, sir.
Mr. Halley. You knew there was gambling there, didn't you ?
Mr. Clark. When we raided it, we found gambling equipment there.
Mr. Halley. Did you ever go back to find out if they w^ere still
gambling after they opened up again ?
Mr. Clark. I never had any complaints about them. I never had any
affidavits or warrants to go back,
Mr. Halley. You never tried to walk in the door and look around?
Mr. Clark. No, sir.
Mr. Halley. You have heard testimony, haven't you, that anybody
in the State would walk in the front door and walk into the gambling
rooms and .gamble ? You didn't have to break any doors down to
gamble in Greenacres or in Club Boheme ?
Mr. Clark. I don't know. I wasn't there.
Mr. Halley. Do you read the newspapers ?
Mr. Clark. Yes ; I read the newspapers some.
Mr. Halley. Doesn't it say in the newspapers that anybody can
walk into those places and gamble, as long as you have the money to
gamble with?
Mr. Clark. I can't believe it when they say all those places. If
there was and if they come before the court and got a search warrant
and made an affidavit to me to that effect, we would have to raid it,
Mr, Halley, Do people have to go to court for you to do your duty ?
Mr, Chancey, Mr, Chairman, I object to the manner in which
counsel is trying to
Mr. Halley, If you have a specific objection to a specific question,
raise it. Please don't heckle,
Mr. Chancey, I have a right to appear here as attorney for this
witness and I have a duty here to perform, and I want to object to
the question that was asked and protect against an answer to it by the
witness.
The Chairman, Kead the question, please.
The Reporter (reading) :
Do people have to go to court for you to do your duty ?
The Chairman. He can just ask whether or not you do your duty
without having to go to court.
Mr. Halley. You don't need a warrant to walk into any premises
that are open to the public, do you ?
Mr. Clark. You need a warrant if you want to go and raid the
place.
Mr, Halley, You don't have to raid a place to walk in and see
gambling, where the doors are wide open and if it is a public estab-
lishment, do you? You are the sheriff. You know the law. You
have as much right as any other citizen to walk into these gambling
houses that has its doors wide open to the public.
Mr. Clark, It wouldn't do me any good to walk down there,
Mr, Halley, Why not?
Mr, Clark. Because they would close it if they saw me coming.
Mr. Halley. You would be in before they could get it closed,
wouldn't you? You could ride up to that place in an automobile
and be upstairs before they could do much about it ?
ORGANIZED CRIM'E' IN INTERSTATE COMMERCE 469
Mr. Clakk. I don't think so.
Mr. Halley. Did you ever try it ?
(No response.)
The Chairman. Slieriff , you said in the record that you didn't know
the exact amount of boli'ta sales during the period it had been
operating?
Mr. Clark. I don't know anything about the bolita sales.
The Chairman. You had no interest in the work whatever in the
Broward Amusement Co. ?
Mr. Clark. The only thing I know of is the music and the cigarette
machines.
The Chairman. Sherifi', don't you know that they paid Federal tax
on 100 slot machines, 25 pinball machines, 10 music machines;!
Mr. Clark. No; I do not.
The Chairman. Well, you are a partner. Don't you discuss these
matters with them?
Mr. Clark. The only thing I had an interest in was the music ma-
chines and the cigarette machines.
The Chairman. It is all operated by the same partnership, the
Broward Amusement Co. It is all put in together in one operation,
whatever they do — you and your brother Kobert and Mr. Williams;
isn't that the company or partnership ?
Mr. Clark. That is the partnership in the amusements.
The Chairman. Whatever the business is, that is the partnership ;
is that correct?
Mr. Clark. Yes, sir.
The Chairman. You wouldn't know whether it was a $200,000 busi-
ness or how much it was ?
Mr. Clark. No, sir.
The Chairman. All right, Sheriff. That is all.
Do you want to ask him any questions, Mr. Chancey ?
Mr. Chancey. Mr. Chainnan, I would like to ask him one or two
ijuestions.
Have you from time to time sought my advice to you as an attorney
as to your rights and duties of your office as sheriff of Broward County
with respect to gambling and the suppression of gambling in that
2ounty ?
Mr. CLiiRK. Yes, sir.
Mr. Chancey. Have I given you advice as an attorney in that
egard ?
Mr. Clark. Yes, sir; you have.
Mr. Chancey. Have you had occasion recently to ask me to reduce
:hat advice that I had given you to writing ?
Mr. Clark. Yes; I have.
Mr. Chancey. Did I do that?
Mr, Clark. Yes.
Mr. Chancey. Do you have that writing with you ?
Mr. Clark. Yes, sir; I have.
Mr. Chancey. I would like to ask the permission of the chairman
lO read a letter that I recently wrote to the sheriff with reference to
Ills duties as sheriff of the county.
The Chairman. You may either read it, file it, or summarize it,
whichever you wish. How long is the letter ?
Mr. Chancey. It has a couple of pages.
470 ORGANIZED CRIMEI IN INTEESTATE COMMERCE
The Chairman. Then you can read it.
Mr. Chancey. Yes, sir.
July 11, 1950.
Hon. Walter R. Clark,
Sherift of Broward County, Fort Lauderdale, Fla.
Dear Sheriff Clark : At your request I am herewith confirraing the advice
which I have heretofore from time to time given to you as sheriff of Broward
County pertaining to your official duties and obligations with reference to gam-
bling carried on in Broward County.
Chapter 849 of the Florida Statutes Annotated prohibits gambling. Section
849.01 of this statute provides that whoever keeps or maintains a gaming table
or room or gambling implements or apparatus, or house, booth, tent, shelter, ov
other place for the purpose of gaming and gambling shall be guilty of a felony.
Section 849.20 provides that any room, house, building, or other structure in
which gambling machines, devices, or paraphernalia are used or operated in
gaming or gambling is declared to be a common nuisance. Section 849.21 pro-
vides that an action to enjoin any such nuisance may be brought by any person
in the courts of equity in this State.
There is nothing contained in chapter 849 which could possibly be construed
to place any obligation upon the sheriff of the county to prohibit or suppress
gaming or gambling.
Section 144.01 of the statutes provides that : "The sheriffs, in their respective
counties, shall execute all writs, processes, and warrants directed to them, and
they shall be conservators of the peace ; and they shall with force and stron?hand
when necessary, suppress all tumults, riots, and unlawful assemblies, and appre-
hend, without warrant, any person who is in the disturbance of the peace, and
carry him before the proper judicial officer, that further proceedings may be had
against him according to law."
Section 790.01 of the statutes makes the carrying of concealed weapons by any
pers'm other than sheriffs, deputy sheriffs, city or town marshals, policemen,
constables, or United States marshals, or their deputies a mi.sdemeanor, and
section 790.02 permits "any officer authorized to make arrests" to arrest "without
warrant" any persons carrying concealed weapons in violation of section 790.01.
Section 901.15 provides that a peace officer without a warrant may arrest a
person :
"(1) When a person to be arrested has committed a felony or misdemeanor in
his presence. In the case of such arrest for a misdemeanor the arrest shall be
made immediately or on fresh pursuit.
"(2) When a felony has in fact been committed, and he has reasonable ground
to believe that the person to be arrested has committed it.
"(3) When he has reasonable ground to believe that a felony has been or is
being committed and reasonable ground to believe that the person to be arrested
has committed or is committing it.
"(4) When a warrant has been issued charging any criminal offense and ,
has been placed in the hands of the peace officer for execution."
It is to be noted that the above statute provides that a peace officer may with- .
out warrant make an arrest of any person under the circumstances stated in i
paragraphs (1) and (3) of said statute. I do not believe that this statute makes <l
it compulsory for the sheriff to arrest without warrant a person who has com-
mitted a felony or misdemeanor, particularly if the sheriff does not know of
his own knowledge and is not able to produce convincing proof that such felony
or misdemeanor has been actually committed.
Section 823.05 of the statutes provides that whoever shall ei-ect, establish,
continue, or maintain any place or building where games of chance are engaged
in violation of law, or any place where any law of the State of Florida is vio-
lated, shall be deemed guilty of maintaining a nuisance, and the building or
place and the furniture, fixtures, and contents therein is declared a nuisance.
All such places or persons shall be abated or enjoined as provided in sections
64.11 to 64.15.
Section 64.11 provides that whenever any nuisance as defined in section 823.65
is kept, maintained or exists, "The States attorney, county solicitor, county
prosecutor or any citizen of the county through any attorney he may select
may maintain his action by bill in chancery in the proper court in the name
of the State of Florida upon the relation of such attorneys or citizens to enjoin
said nuisance, the person or persons conducting or maintaining the same and
lORGANIZED CRIME IN INTERSTATE COMMERCE 471
the owner or agent of the building or ground upon which said nuisance exists.
Section 548.01 of the statute nialves it a crime for any persons to engage In
certain pugilistic exhibitions, and section 548.02 provides that the sheriff or his
deputies, "where there is cause to believe that such an encounter or contest
is about to occur, shall enter any house or enclosure, or any other place, and
arrest, without warrant, any party engaged or about to engage in such contest."
Section 856.0.3 provides that any sheriff, constable, policeman, or other law-
ful officer may arrest any vagrant described in 856.02 without a warrant in case
delay in procuring one would probably enable suqh alleged vagrant to escape.
Chapter 933 of the stntutes provides for the issuance of search warrants. Sec-
tion 933.01 provides that a search warrant authorized by law may be issued
by any judge, including the judge of the circuit court of this State or any court
of record, or criminal court of record, or county judge, justice of the peace,
or committing magistrate having jurisdiction within the district where the
place, vehicle or thing to be searched may be. Section 933.02 provides that
"upon proper affidavits being made a search warrant may be issued under the
provisions of this chapter * * * when property which have been
used * * * in connection with gambling, gambling implements, and
a]ipliances."
Sections 933.04, 933.05, and 933.06 provide respectively as follows :
";»3."..04 Affidavits. — The right of the people to be secure in their persons,
houses, papers, and effects against unreasonable seizures and searches shall
not be violated and no search warrant shall be issued except upon probable
< ause, supported by oath or affirmation particularly describing the place to be
searched and the person and thing to be served."
••933.05. Issuance in blank prohiliited : A search warrant cannot be issued except
upon probable cause supported by affidavit or affidavits, naming or describing
the person, place, or thing to be searched, and particularly describing the proj)-
ertx or thing to be seized; no such warrant shall be issued in blank and any
such warrant shall be returned within 10 days after issuance thereof."
"933.06. Sworn application required before issuance : The judge or magistrate
must, before issuing the said warrant, having the application of some person for
said warrant duly sworn to and subscribed, and may receive further testimony
from witnesses or supporting affidavits, or depositions in writing, to support the
application. The affidavit and further proof, if same be had or required, must
set forth the facts tending to establish the grounds of the application or probable
ciinse for believing that they exist."
Sections 901.01 and 901.02 provide, respectively:
"901.01. Judicial officers to be committing magistrates : All judicial officers of
this State shall be conservators of the peace and committing magistrates, and
may issue warrants against persons charged on oath with violating the criminal
laws of the State, and may commit offenders to jail or recognizs them to appear
before the proper couit at the next ensuing term thereof to answer the charge,
or may discharge them from custody, according to the circumstances of the case,
and nmy require sureties of the peaee when the same has been violated or
threatened. When a complaint is made to a magistrate that an offense has been
coiiimitted within his jurisdiction, he shall examine any witnesses he may
pr(>duce."
"901.02. When warrant of arrest to be issued : A warrant may be issued for
the arrest of the person complained against if the magistrate from the examina-
tion of the complainant and the other witnes.ses, if any, has reasonable ground
to believe that any offense was committed within his jurisdiction and that the
person against whom the complaint was made committed it ; provided, however,
that a warrant may be issued by said magistrate for the arrest of the person
complained against upon presentation to him of affidavits sworn to by the com-
plaining witness or witnesses before the jirosfcuting attorney, provided such
prosecuting attorney is authorized to administer oaths as a notary public or
otherwl.se."
Article 5 of section 15 of the Florida constitution provides that the duties of
a "sheriff shall be prescribed by law."
There is no statute which requires or permits a sheriff without a search war-
rant duly and properly Issued in accordance with the provisions of the statutes
above quoted to go from door to door or place to place throughout the county
and enter private property without permission of the owner for the purpose of
searching the premises to determine whether the statutes prohibiting gaml)ling
are being violated or whether any other criminal statute is being violated,
68958— 50— pt. 1 31
472 ORGANIZED CRIME: IN INTERSTATE COMMERCE
It seems perfectly clear to me that the only duty resting upon the sheriff of
the county is to promptly and efficiently execute warrants for the arrest of per-
sons charged with gambling issued by the courts upon affidavits made therefor
by witnesses to the facts, and it seenns equally clear from the statutes al)ove
quoted that the only circumstances under which a sheriff can search private
property for the purpose of determining whether or not the gambling laws are
being violated is when the sheriff holds in his possession a search warrant duly
issiied by the courts pursuant to the provisions of the above-quoted statutes.
Prior to Septemlier 10, 1934, there did exist a statute (sec. 7664, CGL 1927)
which provides that "if any sheriff, city marshal, or chief of police has good
reason to believe that gambling is being cai-ried on in any house or other place,
he may enter the same forcibly, if necessary, and without written warr;int, and
may arrest any person violating the provisions of this article." By a decision
rendered on December 10, 1934. in the case of Thin man v. the State of Florida
(156 S'. 4S4), the Supreme Court of Florida declared this statute to be uncon-
stitutional as in violation of the declaration of rights.
It necessarily follows that until there is a change nvade in section 22 of the
declaration of rights in the Constitution of the State of Florida, you as sheriff
are only entitled to enter upon private property for the purpose of searching;-
for the conduct on said property of gambling or the maintenance on said prop-
erty of gambling machines, devices, or paraphernalia operated in gaming and
gambling when there is issued by some court of competent jurisdiction a warrant
directed to you to search such premises, which warrant is issued pursuant to
sections 933.04, 933.05, and 933.06 of the Florida statutes above quoted.
Sincerely yours,
C. L. Chancey.
The Chairman. We are glad to have your letter, and we will be glad
to file this letter, if you so desire.
Mr. Chancey. Yes, sir.
The Chairman. Could I ask you just one question about this letter?
Mr. Chancey. Yes, sir.
The Chairman. I take it, then, as to these places where the enforce-
ment officers can go, if they see the law being violated they can do
something about it?
Mr. Chancey. If he sees it.
The Chairman. And there is some duty on him to try to see it. isn't
there ?
Mr. Chancey. Yes, sir.
The Chairman. You read from the statutes or from the constitu-
tion that he is the chief enforcement officer?
Mr. Chancey. But there is no authority for him to see it illegally.
If he wants to see it, there are methods that are prescribed by which
he can obtain a warrant, or the party knowing the facts can obtain a
warrant for him to go and see.
The Chairman. But it is a part of his duty to carry on a reasonable
prudence and reasonable effort to try to see what laws, if any, are
being violated tliat he can see?
Mr. Chancey. I don't say that the sheriff is obligated to sneak all
his life. He is not obligated or required by any statute, in my opin-
ion, or any rule of the court or otherwise, to devote his time searching
out places where gambling may be carried on, where there are lots of
more important crimes to be inquired into.
The Chairman. Mr. Chancey. are you the attorney for the sheriff's
office ?
Mr. Chancey. I am attorney foi- — you might say I am attorney for
the shei'iffs office. I re]n"esent the sheriff.
The Chairman. Do you keep the tax books and records of the
Broward Novelty Co. ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 473^
Mr. Chancey. No, sir ; I know no more about that than — apparently
you know a lot more about it than I do. I know nothin<»\ I know
Mr. Gordon does, and I know he runs the Broward Novelty Co.
The Chairman. Who is that?
Mr. Chancey. Mr. Gordon. I know him. I represent him.
The Chairman. Do you represent the novelty company ^
Mr. Chancey. No, sir; I said "Mr. Gordon." I meant to say ''Mr.
Williams."
Mr. Halley. Just to get the record perfectly straight, there is a
Broward Novelty Co. ; is that right ?
Mr. Clark. Yes, sir.
Mr. Halley. It was formerly the Broward Amusement Co. ; is that
right ?
Mr. Clark. I don't know.
Mr. Halley. You do know there is a Broward Novelty Co.; don't
you ?
Mr. Clark. Yes, sir.
Mr. Halley. And you do know that you are a partner in it?
Mr. Clark. Partner in the
Mr. Halley. Broward Novelty Co.?
Mr. Clark. That operates the music machines and the cigarette
machines.
Mr. Halley. Let's put it this way. There is a company in which
three men are partners; is that right? One of them is Williams; is
that right?
Mr. Clark. Yes, sir.
Mr. Halley. And one is your brother Robert ?
• Mr. Clark. Yes, sir.
Mr. Halley. iVnd the other is yourself ?
'■. Mr. Clark. Yes, sir.
Mr. Halley. Was there formerly a partner named H. J. McLean?
- Mr. Clark. I don't know.
_ Mr. Halley. In any event, at the present time there are three men
in the partnership — Williams, Robert Clark, and yourself?
' Mr. Clark. Yes, sir.
Mr. Halley. And they do business under the name of the Broward
Novelty Co. ?
Mr. Clark. Yes. sir.
Mr. Halley. And you say that the business they do is what?
'< Mr. Clark. To my knowledge, it is cigarette machines and music
machines.
Mr. Halley. Now, if as a matter of fact that company paid a Fed-
feral license tax of $3,086.34 on machines including 100 slot machines
and 25 pinball machines — and I will say for the record that that is
the fact — did you have knowledge of it ?
Mr. Clark. No; I did not.
Mr. Halley. Do you deny that that would be the fact? If that
fax was paid by the company?
Mr. Chancey. Do j^ou mean if they did pay it ?
Mr. Halley. Yes.
Mr. Clark. I haven't any right to deny it because I don't know.
Mr. Halley. Apparently I made a mistake on the number of ma-
chines. It is not 100 slot machines, but it includes some slot ma-
chines; does it not?
474 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Clark. I don't know.
Mr. Halley. You don't know ?
Mr. Clark. No, sir.
Mr. Halley. If a license tax was paid, you wouldn't deny that that
did happen — would you ? — whether or not you had knowledge of it ?
Mr. Clark. I don't know whether they did or not. I don't haA ((
any knowledge of it.
Mr. Halley. It is possible that Broward Amusement Co., or Brow-
ard Novelty Co. might have been operating these machines without
your knowledge; is it?
Mr. Clark. Yes, sir.
Mr. Halley. Is it possible that the Broward Amusement Co. or the
Broward Novelty Co. could have been operating bolita without your
knowledge ?
Mr. Clark. It is without my knowledge.
Mr. Halley. You admit that they did operate it?
Mr. Clark. No, sir.
Mr. Halley. If they reported in their tax return that they operated
it, would you deny that that was the fact?
Mr. Clark. I couldn't deny the fact because I don't know.
Mr. Halley. You wouldn't contest the tax return ?
Mr. Clark. No, sir.
Mr. Halley. Wlio is L. J. Matson?
Mr. Clark. I don't know.
Mr. Halley. Did you ever hear of him?
Mr. Clark. Not tliat I know of.
Mr. Halley. Did you ever hear of that name before?
Mr. Clark. No, sir; I don't believe so. I don't know who it is.
Mr. Halley. You never heard the name "L. J. Matson" before?
Mr. Clark. I don't know if I ever heard of it before, to my
knowledge.
The Chairman. Let's get this straight about the amusement com-
pany. They started off in 1945 ; is that about right?
Mr. Clark. I don't know what year it was.
The Chairman. About 5 years ago or something like that. You
had it in your 1945 tax return. Would it be substantially correct that
your income produced from that venture in 1945 was $12,910.88 ? Do
you think that would be substantially correct ?
Mr. Clark. It might be?
The Chairman. And that the Broward Amusement Co. return was
$20,607.08 in 1946?
Mr. Clark. I will have to look on the tax returns and see.
The Chairman. Would you think that that would be substantially
correct ?
Mr. Clark. It could be ; yes, sir.
The Chairman. And $18,000 in 1947; do you think that is about
correct ?
Mr. Clark. I think so.
The Chairman. I don't have the reference for the other years. You
wouldn't question the amount of business that is reported in the re-
turns to have been done by this company during these years, would
you; this partnership?
Mr. Clark. I couldn't say, because I don't know.
ORGAXIZED CRIME' IN INTERSTATE COMMERCE 475
The CiiAiRMAX. Who fixed up the income-tax return?
Mr. Clark. Mr. Coleman fixed ii]) my income-tax returns.
The Chairman. Did he also fix up the income-tax return for the
Broward Novelty Co.?
]\Ir. Clark. I don't know if he did or not.
The Chairman. The amount of the partners' share and then the
amount shown on your return indicate they might have been fixed up
by the same person ; M'ould that be true ?
^Ir. Clark. Yes, sir.
The Chairman. Is this company still in operation ?
Mr. Clark. Yes, sir.
The Chairman. Mr. Williams is still the manager of it ?
Mr. Clark. Yes, sir.
The Chairman. And it is still a three-way partnership among the
three of you?
Mr. Clark, Yes, sir.
The Chairman. Does it have an office ?
Mr, Clark, Yes, sir; they have an office.
The Chairman. Where is the office ?
Mr. Clark. I don't know the address, but it is out on Broward
Boulevard.
The Chairman. Did you ever go out there ?
]\Ir. Clark, Yes, sir ; I went out there.
The Chairman, You go out there and see about the business some-
times; don't you?
Mr, Clark. I don't attend to the business ; no, sir.
The Chairman. Wlien do you have partnership meetings ?
I\Ir. Cl.vrk. Never had any.
The Chairman. Never had a single partnership meeting?
jSIr. Clark. No, sir.
The Chairman. Don't you meet with them on the street and talk
with them about the business? I mean, about how much money you
are making? It seems to be a pretty big business.
]\Ir. Clark. I ask them how it's going.
The Chairman. Wliat do they tell you about how it is going?
IMr. Clark. Pretty good.
The Chairman. It is doing well or not so well or whatever it may be ?
]Mr. Clark. Yes, sir.
The Chairman. All right. I believe that is all.
]Mr. Chancey. Are we excused now ?
The Chairman. You are excused. Thank you for appearing, Mr.
Chancey.
Mr, Chancey, Thank you, sir.
FURTHER TESTIMONY OF ABE ALLENBERG, MIAMI BEACH, TIA.,
ACCOMPANIED BY LOUIS M, JEPEWAY, ATTORNEY
The Chairman, Do you solemnly swear that the testimony you will
jive the committee will be the truth, the w^hole truth, and nothing but
he truth, so help you God ?
Mr, Allenberg, Yes, sir.
The Chairman. Let the record show that Louis M. Jepeway appeals
IS counsel for Mr. Allenberg.
jNlr. Halley. Wliat is your business, Mr. Allenberg ?
476 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Allenberg. Hotel manager.
Mr. Halley, Mr. Allenberg, some years ago you came to Miami as
a representative of Frank Erickson ; is that right ?
Mr. iVLLENBERG. That is correct.
Mr. Halley. Had you represented Frank Erickson in New York
prior to that ?
Mr, Allenberg. Yes, sir.
Mr. Halley. As a lawyer? ;
Mr. xVllenberg. Yes, sir.
Mr. Halley. When did you first come to Miami ?
Mr. Allenberg. 1935.
Mr. Halley. Might I say in passing that these are matters which
you have previously testified to this committee.
Mr. Allenberg. Yes, sir.
Mr. Halley. Will you go ahead and start from 1935 and state to
the committee the circumstances under which you first came to Miami
and what you did and go as far as you can tell with reference to that
and in chronological order.
Mr. Allenberg. In 1935 I came here representing Erickson. There
was a mortgage to be placed on Tropical Park race track because of
certain obligations that the track had, and they owed merchants and
they owed the businessmen of the area considerable money. They
owed the State some money, and Erickson put up the money to pay off
all of these obligations and to pay the State, and it was done and on a
100-percent basis. There was no settlement with creditors. Every-
body was paid up in full. He received back a mortgage from the race
track and he received 20 percent of the stock.
Mr. Halley. How much money did Erickson invest?
Mr. Allenberg. $250,000, about.
Mr. Halley. And for that did he get a controlling interest in the
track?
Mr. Allenberg. No, sir.
Mr. Hali^ey. He controlled the track; didn't he?
Mr. Allenberg. He had bonds for the extent of his loan to the
track.
Mr. Halley. He was given control of the track ?
Mr. Allenberg. I was the one that went in there.
Mr. Halley. And you ran it ? ,
Mr. Allenberg. I ran it.
Mr. Halley. You were the comptroller ?
Mr. Allenberg. Yes, sir.
Mr. Halley. How long did you run and control Tropical Park I
track? 1
Mr. Allenberg. Until 1941.
Mr. Halley. Did Erickson then sell his interest ?
Mr. Allenberg. Yes, sir.
Mr. Halley. To whom was that interest sold ? i
Mr. Allenberg. To a group of men headed by H. L. Straus, a man (
by the name of Munn, and A. C. Schwartz. It was a gToup. '
Mr. Halley. Jolni Patton was in that group, wasn't he ?
Mr. Allenberg. That is to whom it was sold. He was one of the |
original stockholders. He sold out. I
Mr. Halley. He sold out.
Mr. Allenberg. At the sale to Straus and the others.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 477
Mr. Hali.ey. He and Erickson sold out?
Mr. Allenbekg. Everybody sold out. All the stockholders sold their
stock.
Mr. Halley. And you handled that transaction?
Mr. Aeeenbekg. I wasn't the attorney for them at that time.
Mr. Haeley. There were certain commissions due and payable?
Mr. Allenbekg. Yes, sir.
Mr. Halley. That was in 3'our name?
Mr. Allenbekg. Yes, sir.
Mr. Halley. Were you on a salary basis at Tropical Park?
Mr. Allenbekg. Yes, sir.
Mr. Halley. What was your salary ?
Mr. Allenbekg. $15,000.
Mr. Halley. Did you have any other income from Tropical Park?
Mr. Allenbekg. No, sir.
Mr. Halley. Did you have an}^ ownership or beneficial interest in
Tropical Park?
Mr. Allenbekg. No, sir.
Mr. Halley. Or in any of the Tropical Park transactions?
Mr. Allenbekg. No, sir.
Mr. Halley. We mentioned some commissions some time ago. I
believe it was a total of $80,000 ?
Mr. Allenbekg. That was on the sale of the track. I had nothing
to do with the track myself.
Mr. Halley. Did you have any personal interest or a half interest
in the $80,000.
Mr. Ali^enberg. No, sir.
Mr. Halley. Who clid?
Mr. Allenbekg. Erickson and John Patton.
Mr. Halley. That is the same Patton who is associated with Wil-
liam Johnston ?
Mr. Allenbekg. Yes, sir.
Mr. Halley. Did you have any other income from Frank Erickson?
Mr. Allenbekg. No, sir.
Mr. Halley. In the various dog tracks; is that right?
Mr. Allenbekg. That is correct.
Mr. Halley. When you left Tropical, what did you do next ?
Mr. Allenbekg. I went into the hotel business. I went into the
WofFord Hotel.
Mr. HaI;I>ey. Will you explain the circumstances ?
Mr. Allenbekg. There was a lease held by Tom Cassara and he
•went to ]\[rs. Wofford and told her that they owed considerable money
and wanted to dispose of their lease. She said she wouldn't consent
to any assignment of the lease, so I entered into a manager's agree-
ment and took a 50-percent interest in the management of the hotel
in whatever profits were made and all the expenses that would come
ill and this agreement was with IMax Marmelstein of Cleveland.
Mr. Halley. Where did you get the money ?
]\rr. Allenbekg. I had $10,000 of my own and I had borrowed about
$11,000 from Erickson.
Mr. Halley. Eventually Erickson loaned you some money still
further, did he not ?
Mr. Allenbekg. Yes, sir.
478 ORGANIZED CRIME: IN INTERSTAl^E COMMERCE
Mr. Halley. There are documents which show that Erickson con-
sidered himself a partner of yours in the deal; that he had a half
interest in Allenberg?
Mr. Allenberg. That is right.
Mr, Halley. And was he paid his half of the profits?
Mr. Allenberg. He was paid his money back and there might have
been a few extra dollars and then he declared himself out.
Mr. Halley. He just said he was out ?
Mr. Allenberg. Yes.
Mr. Halley. In effect making you a gift of it ?
Mr. Allenberg. Yes, sir.
Mr. Halley. From then on you had the management contract
yourself ?
Mr. Allenberg. Yes, sir.
Mr. Halley. In that management you were associated with certain
other people ?
Mr. Allenberg. Yes, sir.
Mr. Halley. There is a chart here. Perhaps it would be simpler
if you would just use the chart to refresh your recollection and tell the
committee with whom you were associated at the Wofford Hotel.
Mr. Allenberg. Cassara told me when I went in there that the only
one that might have an interest would be John King. I didn't know
John King and I made inquiry about him and I found out there was
nothing against him that anybody told me.
Mr. Halley. He happens to be a notorious racketeer.
Mr. Allenberg. I didn't know it at that time.
Mr. Halley. You know it now?
Mr. Allenberg. I know it from reading about it.
Mr. Halley. Will you go ahead ?
Mr. Allenberg. Also around the hotel he said that he represented
his father-in-law Jimmy Kelly ; also Anthony Carf ano whose name
is on there.
Mr. IL\LLEY. That is Little Augie?
Mr. Allenberg. Known as Little Augie.
Mr. Halley. He certainly is a notorious racketeer and was for
many years?
Mr. Allenberg. That is correct.
Mr, Halley. You knew that ?
Mr. Aixenberg. I didn't know it at the time.
Mr, Halley, You knew who he was ?
Mr. Allenberg. Yes.
Mr. Halley. And if somebody had mentioned him to you, you
would have known he was a racketeer ?
Mr. Allenberg. Yes.
Mr. Halley. When did you first find out he was in the deal ?
Mr. Allenberg. It was very long after I got started in the hotel J
and started to fix it up and clean it up.
Mr. Halley. How did tliat happen ?
Mr, Allenberg. I saw him around tliere, ||
Mr, Halley, What year was this ^ ' I"
Mr. Allenberg. 1941.
Mr. Halley. Will you go ahead ?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 479
Mr. Allenberg. I stayed around in that particular hotel until
1945 — about May 1945. Then I made arrangements to sell my in-
terest to Jolm King.
Mr. Halley. Before you leave the Wofford Hotel, you will notice
on that chart which, I might say, is for the most part compiled from
your former testimony before the committee, contains certain names
in the lower left-hand corner in the box eiititled "Gambling games."
Will you tell the committee about those gambling games ?
Mr. Allenberg. They were private games. This is just from hear-
say that I am telling you because I never saw any of them myself.
jMr. Halley. But you were managing this hotel ?
Mr. Allenberg. Yes, sir; I was.
Mr. Halley. And various people gathered there to gamble
privately ?
Mr. Alucnberg. I would think so.
Mr. Halley. Was there any public gambling at the Wofford Hotel ?
Mr. Allenberg. No, sir.
Mr. Halley. Was there any race-track booking?
Mr. Allenberg. No, sir.
Mr. Halley. Any gaming room ?
Mr. Allenberg. No, sir.
Mr. Halley. There was just this jDrivate card room ?
Mr. Allenberg. Yes.
Mr. Halley. Where did that take place?
Mr. Allenberg. In one of the suites.
Mr. Halley. Who frequented that card game ?
Mr. Allenberg. Sir?
Mr. Halley. Who were the people who played cards there together?
Mr. Jepeway. If you know.
Mr. Allenberg. Fellows like Jolinny King, Little Augie
Mr. Halley. Joe Massey ?
Mr. Allenberg. I didn't see Joe Massey around there. I didn't
see Fischetti around there, but there were others that came in and they
played cards with them.
Mr. Halley. Di Carlo?
Mr. Allenberg. I don't know. He lived at the hotel, so I imagine
he played cards with them, too.
Mr. Halley. Now, looking at the left to the associates and the
clientele, will you just go down the list taking one of them at a time
and tell the committee which of these people did either stay or visit
and which didn't.
Mr. Allenberg. I don't know who the Civettas are. I don't know
Zwillman. I don't know Delmore and I don't know Stefano, and I
don't Iniow the last, Nick Bravos.
Mr. Halley. You know Zwillman?
]\Ir. Allenberg. Only by reputation.
Mr. Halley. Didn't he come to the hotel ?
Mr. Allenberg. No, sir.
Mr. Halley. Never?
Mr. Allenberg. I never saw him.
Mr. Halley. But JNIassey did. He came to the hotel.
Mr. Allenberg. Occasionally.
Mr. Halley. And he would visit King and Carfano?
Mr. Allenberg. Yes, sir. '
480 ORGANIZED CRIME; IN INTERSTATE COMMERCE
Mr. Halley. And Bisclioff— Lefty Clark?
Mr. Allenberg. I never saw him around there.
Mr. Halley. But you know of him ?
Mr. Allenberg. I know who he is ; yes, sir.
Mr. Halley. Who else did you see around the hotel? That is, of
the people on that list ?
]\Ir. Allenberg. Herman Stark.
Mr. Halley. How about Costello?
Mr. Allenberg. Occasionally he came down.
Mr. Halley. He would come to the hotel ?
Mr. Allenberg. Occasionally.
Mr. Halley. And Erickson?
Mr, Allenberg. Yes, he was there.
Mr. Halley, In fact, there was testimony that you would go and
meet Erickson at the station and bring him back in your car; isn't
that so?
Mr. Allenberg. At times; yes, sir.
Mr. Halley. Now, does that cover the people who came to the
hotel?
Mr. Allenberg. Substantially.
Mr. Halley. So that you would say that the chart is substantially
correct, would you not ?
Mr. Allenberg. I would say so ; yes.
Mr. Halley. Erickson, in addition to his interest at Tropical Park,
had certain other business in the Miami area, did he not?
Mr. Allenberg. I have heard about them, but I don't know of my
own knowledge.
Mr. Halley. You have testified with reference to some things.
Let's see what we can cover. He did have an interest in the Colonial
Inn ; at the time when it did have gambling in it, did he not ?
Mr. Allenberg. Yes, sir.
Mr. Halley. In fact, you were there with him ?
Mr. Allenberg. No, sir, I was not.
Mr. Halley. You were there. You visited the place.
Mr. Allenberg. I have been to Colonial Inn.
]\Ir. Halley. I didn't mean to say that you had an interest in it. I
mean you were physically present in the premises?
Mr. Allenberg. I had no participation in it.
Mr. Halley. I hadn't meant to say that you had a participation.
You visited Colonial Inn with Erickson ?
Mr. Allenberg. Not necessarily with Erickson. I would go up
there myself.
Mr. Halley. With anybody else?
Mr. Allenberg. With many people.
Mr. Halley. He had, in addition to that, the horse-betting con-
cession at the Roney Plaza ; is that right?
Mr. Allenberg. So I have heard.
Mr. Halley. You know.
Mr. Allenberg. I know it.
Mr. Halley, And he had the betting concession at the Hollvwood
Hotel?
Mr. Allenberg. So I have heard.
Mr. Halley. And at the Boca Raton?
Mr. Allenberg. I have heard of it.
ORGANIZED CRIM'E' IX IXTERSTATE COJVIME'RCE 481
Mr. Jepeway. Wliat years are we talkinj^ about?
Mr. HaixiEy. Mr. Allenberg can testify as to the particular year?.
•Would you specify what years, Mr. Allenberg i
Mr. Allenberg. I wouldn't know what years particularly.
Mr. Halley. Yo.u know in some years recently these things have
been so ?
Mr. Allexberg. Yes, sir.
Mr. Halley. And he also conducted a bookmaking business at the
race track, did he not?
Mr, Allenberg. Yes, sir, so I am told.
Mr. Halley. You were more than told that, Mr. Allenberg. You
know, for instance, Bert Briggs?
Mr. Allenberg. Yes.
Mr. Halley. And Frank Strader?
Mr. Allenberg. Yes.
Mr. Halley. And Al Cantor?
Mr. Allenberg. Yes, sir.
Mr. Halij:y. And Jackie Zeldow?
Mr. Allenberg. Yes, sir.
Mr. Halley, They worked for Erickson ?
Mr. Allenberg. That is correct.
Mr. Halley. And they also lived at the Wofford Hotel?
Mr. Allenberg. I think they did. Some of them did, anyhow.
Mr. Halley. During the racing season those people would go to
the race track every day, wouldn't they ?
Mr. Allenberg. Yes, sir.
Mr. Halley, And they would take bets ?
jSIi'. Allenberg. That is correct.
Mr. Haijley. Those bets would not go through the parimutuel ma-
chines at all ; is that right?
Mr. Allenberg. That I wouldn't loiow. Sometimes I suppose they
might,
Mr, Halley. Some might be put through the machines, but for the
most part Erickson was running a bookie business through these
people at the racetrack?
Mr. Allenberg. I would say so.
Mr. Halley. Isn't it a fact that these i:>eople would return to the
hotel each night, total up the amount of money which had been won
and lost and send a report each night up to New Jersey to the Erick-
son headquarters?
Mr. Allenberg. That would only be surmise. It wouldn't be any
of my own knowledge.
Mr. Halley, You know that they came back to the hotel and sat
around in a room working up the figures ?
Mr. Allenberg, I don't know what they worked on, but I would
assume it might have been.
Mr. Halley. You know what they worked on?
Mr, Allenberg, I assume.
iNIr, Halley, They worked on the results of the day, got the wins
and the losses and they had a tabulation worked up for the day?
Mr. Allenberg. I would think so.
Mr. Halley. And that was sent to Erickson every night?
Mr. Allenberg. That I wouldn't know, Mr. Halley.
Mr. Halley. You know it. You said you know it.
482 ORGANIZED CRIM'EI IN INTERSTATE COMMEiRCE
Mr. Jepeway. May it please the chairman. He is arguing. The
witness said to tlie best of his knowledge he surmises that to be the
situation. I think any further questioning along that line is argu-
mentative.
Mr. Halley. All right, Mr. AUenberg. Go ahead. They sent these
reports up each night, didn't they ?
Mr. Jepeway. If you know, sir.
Mr. Allenberg. I don't know. To the best of my knowledge, I
would think they should have.
The Chairman. Where were the checks cashed ?
Mr. Halley. Now, the time came when you moved your hotel opera-
tions from the WofFord Hotel to the Boulevard Hotel?
Mr. Allenberg. Yes, sir.
Mr. Halley. What interest did you have in the Boulevard Hotel?
Mr. Allenberg. I had a third interest in the Boulevard Hotel ; on
the lease.
Mr. Halley. And you operated it as a hotel man ; is that right ?
Mr. Allenberg. Yes, sir.
Mr. Halley. What years were they ?
Mr. Allenberg. 1945 up to the present April.
Mr. Halley. 1945 up to the present April ?
Mr, Allenberg. Yes, sir.
Mr. Halley. Wlio were the other persons who had an interest in the
Boulevard Hotel ?
Mr. Allenberg. Herman Leavitt and Charles Collins, both hotel
men.
Mr. Halley. Did Briggs and Cantor stay at the Boulevard Hotel?
Mr. Allenberg. Yes, sir.
Mr. Halley. During the time that you had the lease at the Boulevard
Hotel?
Mr. Allenberg. Yes, sir.
Mr. Halley. Did they continue their operations at the track ?
Mr, Allenberg. As far as I know ; yes.
Mr. Halley. Going to the track and taking bets and so forth?
Mr. Allenberg. Yes.
Mr. Halley. And coming back to the hotel each night, totaling the
results and so forth ?
Mr. Allenberg. That is correct.
Mr. Halley. As a result of the operations, they received certain
checks; is that correct? They received checks from bettors?
Mr. Allenberg. I would say "Yes."
Mr. Halley, Can you tell the committee what would happen to the
checks which were paid to these agents of Erickson each day?
Mr. Allenberg. They would go down to the desk and ask if they
could be cashed.
Mr. Halley. Would you personally take them to the bank?
Mr. Allenberg. I used to go to the bank for the firm.
Mr. Halley. And these checks were never endorsed by any of those
people ; Erickson's agents ?
Mr. Allenberg, Oh, yes.
Mr. Halley. Thov were?
Mr. Allenberg. Oh, yes.
Mr. Halley. They had your endorsement on it for cash?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 483
Mr. Allenberg. Yes, sir.
; Mr. Hai.ley. Are you sure they were endorsed by Erickson's agents ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Are you sure you didn't get them and put your en-
dorsement on them as a hotel endorsement '^
Mr. Allenberg. Just my endorsement if the checks were made
out
Mr. Halley. Suppose a check was made out to cash ?
' Mr. Allenberg. Then I would just have my endorsement.
Mr. Halley. And you took these to the bank and cashed them each
morning ?
Mr. Allenberg. That is correct. It wouldn't have been every
morning; maybe once or twice a week.
Mr. Halley. What would you do with the cash ?
jNIr. Allenberg. I would give it to the men.
]\Ir. Halley. Would you name some of the men ?
Mr. Allenberg. I would give it to Briggs or I would give it to
Cantor.
Mr. Halley. And this went on from the year — for what years,
would you state ?
Mr. Allenberg. In the winter, starting in
Mr. Halley. What year?
Mr. Allenberg. 1945, 1946, 1947, 1948, and 1949.
Mr. Halley. You have been rather active politically, have you not.
Mr. Allenberg? ^^ J j
Mr. Allenberg. Occasionally.
Mr. Halley. You made campaign contributions, did you not ?
Mr. Allenberg. Once in a while; yes, sir.
Mr. Halley. Would you state what campaign contributions you
have made ?
Mr. Jepeway. What years are you covering, if I may ask you?
The Chairman. Recent years.
Mr. Allenberg. In the 'Fuller Warren campaign I think I con-
tributed about $300.
Mr. Halley. You had some meetings at the Boulevard Hotel, did
you not, in favor of Fuller Warren ?
Mr. Allenberg. Yes, sir. I had meetings at other hotels too, and
other public places.
Mr. Halley. You were prominent in those meetings, were you not«
Mr. Allenberg. Yes, sir. Just because they picked me out; I didn't
have to be. They could have picked somebody else.
Mr. Halley. What other political activity have you had recently?
^ Air. Allenberg. I made a contribution— I think it was $200— to
jfeenator Pepper's campaign.
Mr. Halley. What contributions have you made to national cam-
paigns recently?
,,%• Allenberg. Well, it was in 1947 that they had a Democratic
JNational Committee dinner down here, at Avhicli they charo-ed $'>50
apiece for tickets, for the dinner tickets, and I sold 10 tickets fo Fra"nk
J^rickson and the $2,500 I got I gave to the committee, and they sent
me an acknowledgment for it.
Mr. Halley. It went in your name; is that right?
Mr. Allenberg. Yes, sir.
484 ORGAlSriZED CRIME' IN INTEIRSTATE COMMERCE
Mr. Halley. Wliat other contributions did you make?
The Chairman. Did you contribute anything to Jimmy Sullivan's
campaign ?
Mr. Allenberg. I gave $50 to Jimmy Sullivan ; that is all. I wasn't
active in many political campaigns. I was the treasurer of the Tru-
man-Barkley committee down here, but that wasn't very active.
The Chairman. Are you a State committeeman or anything of that
sort ?
Mr. Allenberg. No, sir. I just happened to get recommended into
it.
The Chairman. Mr. Allenberg, did you know all of these people up
in New York before they came down here? You knew Erickson?
Mr. Allenberg. Yes, sir.
The Chairman. You knew Costello?
Mr. Allenberg. Yes, sir.
The Chairman. Where did you meet him ?
Mr. Allenberg. From being introduced by Erickson.
The Chairman. Did you represent him?
Mr. Allenberg. No, sir.
The Chairman. And the partnership with John King at the Wof-
ford?
Mr. Allenberg. Yes, sir.
Mr. Halley. Do you know a Henry Pellino, C. P. A. ?
Mr. Allenberg. Yes, sir.
Mr. Halley. Did you have any transactions with him?
j\Ir. Allenberg. He represents Frank Erickson.
Mr. Halley. And you had certain correspondence with him?
Mr. Allenberg. Yes, sir.
Mr. Halley. About Frank Erickson ; is that right ?
Mr. Allenber. Yes, sir.
The Chairman. Mr. Allenberg, the point is your income-tax return
and Erickson's and all of these fellows who operated were made in
New York and not down here ; is that correct ; or did you make your
income-tax return here?
Mr. Allenberg. Down here.
The Chairman. Did you send your books up to New York to have^
it made?
Mr. Allenberg. I used to have Pellino check up returns for mei'
when I was at Tropical Park race track, but after a year or two after
that I just got away from him altogether. I didn't bother with him.
The Chairman. Do you know what year that letter was written ?
Mr. AujEnberg. I would say 1943.
The Chairman. Let that letter be made as an exhibit. (Eefer to
exhibit No. 40, appendix, p. 731.)
Mr. HaijliEy. There is one other document here that the connnittee
would like you to identify, this sheet of paper. Would you state
what it is?
Mr. Allenberg. This is a list of the contributions and monevs that
1 received in the Fuller Warren campaign for Governor. (List of
contributions was marked "Exhibit No. 164," and is on file with com-
mittee. )
Mr. Halli-:y. In 1948?
Mr. Allenberg. Yes, sir.
ORGANIZED CRIME' EST INTERSTATE COMMERCE 485
Mv. Hallet. What is the total amount of contributions you col-
lected for that campaign?
Mr. Allenbekg. It says on here $5,275.
Mr. Haleet. To whom did you turn over that money.
Ml-. Allenbero. To myself.
Mr. Hallet. "VVliat did you Avitli it?
Mr. .Vllexberg. Disbursed it.
Mr. Halley. To whom?
Mr. Alij:nrerg. To different people that did work.
Mr. Hallet. You mean you paid out bills directly?
^Iv. Allenberg. I paid out bills.
Mr. Hallet. You didn't give it to any campaign committee or
count}' committee?
Mr. Alleneerg. I think they had a bank account. If they wanted
to pay the workers they had the cash there.
Mr. Hallet. Did you turn the balance of it over to anybody?
Mr. Allexberg. There wasn't any balance. We were short when
the thing was all over.
Mr. Haixet. You collected some moneys personally, did you?
Mr. Allenbeijg. Yes, sir.
Mr. Hallet. And you distributed some personally?
Mr. Allenberg. Yes, sir.
Mr. Hallet. Was there a balance after you gave money to any com-
mittee or any committee member, individually?
Mr. Allenberg. I don't remember whether they had a bank account
or not. I think they did have a bank account.
Mr. Hallet. Who would "they'' be?
Mr. Allexberg. Well, a legal campaign committee. There were
some reputable men connected with it.
Mr. Hallet. And you were quite active in that campaign?
Mr. Allenberg. Yes. I just became enthused, and ran along with
it after it was over.
The Chairman. Mr. Allenberg, one further question: What was
this Abe Allenberg Contracting Co. ?
Mr. Allenberg. It says Abe Allenberg contract. There was no
such thing as Abe Allenberg Contracting Co.
The Chairman. What did that have to do with the Gables Racing
Association?
Mr. Allex'^berg. That is the contract in reference to the commission,
Senator, that we spoke about in the same testimony here.
The Chairman. The sale of the Tropical Park race track w^as by
Mr. Patton and Mr. Erickson to somebody else ?
Mr. Allenberg. That's correct.
The Chairman. Did John Patton sell out his interest?
Mr. Allenberg. Yes, sir.
The Chairman. Where did Frank Costello come into that picture?
Mr. Allenberg. Frank Costello was not in that picture. Senator.
The Chairman. He didn't have anything to do with it ?
. Mr. Allenberg. No, sir.
'.. The Chairman. Did you have any business dealings with Mr.
Costello down here?
Mr. Allexberg. No, sir.
486 O'RGAISIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Except that he stayed at the Wofford and paid his
rent.
Mr. Allenberg. Occasionally he stayed there. He stayed at a lot
of other famous hotels here, too, and paid his rent.
The CiLviRMAN. But generally the Angersola and Cleveland and
Detroit and New York people stayed at your hotel ; I mean the fellows
down here from New York, Cleveland, and Detroit ?
(No response.)
The Chairman. At any rate, the New York and Cleveland people
usually stayed at your hotel ?
Mr. Allenberg. Senator, there weren't many hotels open on the
Beach back there when those fellows started to come in here. As soon
as they could get into other hotels many of them moved into other
hotels. This hotel was taken over by the Army in '41 and '42, My
hotel had a good reputation with the Army in '42 ; perhaps outstanding
in this area. The Truman committee stopped at that hotel.
The Chairman. And you had many conventions there, didn't you?
Mr. Allenberg. Yes, sir. The Rotary Club met there, and other
V7ell-known organizations met there.
The Chairman. Some question came up about your being an hon-
orary deputy sheriff ; what was that about?
Mr. Allenberg. Just a silly thing, I wanted to be an honorary
deputy sheriff so that I could say I was a sheriff.
The Chairman. Did you ask Mr. Sullivan to make you an hon-
orary deputy sheriff ?
Mr. Allenberg. I asked one of the deputies. I don't remember
w^ho it was now.
The Chairman. Did you talk with Mr, Sullivan about it or just
the deputy?
Mr. Allenberg. I talked to Sullivan for maybe 2 or 3 years about
it, and never got anything.
The Chairman. So you talked with the deputy and got to be an
honorary deputy sheriff?
Mr, Allenberg. Yes, sir ; and I'll give it back to him.
The Chair3ian. Did you ever arrest anybody while you were hon-
orary deputy sheriff ?
Mr. Allenberg, No, sir. I can't even get by the toll on the cause-
way with it.
The Chairman. What made you want to be an honorarv deinity
sheriff?
Mr, Allenberg, Just a matter of vanity, I guess. Senator, so I
could show it to my friends.
The Chairman. Have you liked to read stories about policemen
and things of that sort, so you thought you would like to be one ^
Mr. Allenberg. I don't get nuich chance to read, I work pretty
hard around the hotel.
The CiiAiR]MAN. Unless you want to ask some questions, Mr. Jepe-
way, that is all we have of this witness.
Mr, Jei'ew^vy. I would like to. Mr. Allenberg, when Frank Erick-
son took over an interest in Tropical Park, was that with the full
knowledge and consent of the Florida State Racing Commission?
Mr. Allenberg. Yes, sir.
ORGANIZED CRIME IN INTERSTATE COMMENCE 487
Mr. Jepeway. Did tliey liave full knowledjre of the fact that Frank
Erickson owned a substantial interest in Tropical Park and that that
stock was held in your name for him ?
Mr, Allexberg. Yes, sir.
Mr. Jepeway. They approved it, did they?
Mr. Allenberg. Yes, sir.
Mr. Jepeway. Who was Governor of Florida at that time, as nearly
as you can remember?
Mr. Aelenberg. It was Governor Sholtz.
Mr. Jepeway. Your recollection is that Dave Sholtz was Governor?
Mr. Allenberg. I think so.
Mr. JEPEW^\Y. You mentioned in your direct testimony that you
sold 10 tickets at $250 apiece to the national Democratic dinner. Is
that the one that was held at the Roney Plaza Hotel?
INIr. Allenberg. Yes, sir.
Mr. Jepeway. Is that the one at which the then Attorney General
of the United States of America, Tom Clark, was the principal speak-
er, and who is also now a Justice of the Supreme Court of the United
States, and is that the same dinner at wdiich Frank Erickson bought
10 tickets at $250 apiece ?
Mr. Allenberg. I don't remember who was the principal speaker,
whether it was Tom Clark or not ; I don't remember.
Mr. Jepew^vy. Well, I attended that dinner and my recollection is
that George Smathers was the presiding toastmaster and that Tom
Clark was the principal speaker.
Mr. Allenberg. I'll take your recollection.
Mr. Jepeway. That is the same dinner, the only dinner, that was
held liere, wasn't it ?
Mr. Allenberg. Yes, sir.
Mr. Jepeway, Did Erickson attend the dinner ?
Mr. Allenberg. He did.
Mr. Jepeway. You say he did ?
Mr. Allenberg. Yes, sir.
The Chairman. You are not in partnership with anybody from the
Wofford now ?
Mr. Allenberg. No, sir.
The Chairman. You are not in partnership with Mr. Erickson
any further?
iVIr. Allenberg. jSTo, sir.
The Chairman. I believe that is all, Mr. Allenberg.
Due to the fact that it is necessary for the members of the committee
and also the staff, mosfcof the staff of the committee, to be in St. Louis
on Monday and subsequently in Kansas City, it is going to be impos-
sil)le to carry the proceedings of this investigation beyond this point
at this time.
Some witnesses who have been subpenaed w411 remain under sub-
pena. We will work out some arrangements about hearing them at
a later time. Of course, as to any witnesses who have testified, if
there is some other matter that comes up in reference to their testimony,
or tlie subject matter of their testimony, they will stand under subpena,
Tliere have been certain witnesses upon whom we have been unable to
serve subpenas, and we will expect them to testify in open sessions
68958 — 50 — pt. 1 32
488 ORGANIZED CRIME' IN INTERSTATE COMMERCE
later on. Also, as the inquiry has developed, other names have been
furnished the committee, some of whom may be called upon to testify.
It is, of course, impossible, as I have said at the outset, to go into
all the details about any transactions in any section. I think we have
gone into much more detail here than we will be able to do in other
places, although we want to do as much as we can wherever we go.
In the meantime, some members of the staff of the committee will
continue their inquiry and investigation in Florida to get any addi-
tional evidence or to bring together any bits of evidence that have
been brought out in the testimony.
At a later date certain parts or the testimony of certain witnesses
taken in private hearing as they relate to the inquiry down here will
be released.
The chairman of the committee, on behalf of the committee and
the staff, wants to thank Judge Holland again for the use of this
courtroom and for the cooperation of Judge Holland and of Deputy
Marshal Gates and all of the staff of the marshal's office. We also
extend our thanks to the many other officials who have been so cour-
teous and kind to us and to the visiting members of the press who
have come down here and to the many public-spirited citizens who
have received us and tried to help us with pur work since we have
been in Miami.
I hope that the public will appreciate that a great deal of the job
that this committee has to do is not a pleasant one. It doesn't par-
ticularly mean anything to us back in our home States. We do feel,
and the Senate of the United States feels, that where there is, and if
there is, large organization of criminal activity in interstate commerce
which has a deteriorating effect upon the public generally and takes
away from working people large sums of money, adversely affecting
the economy and the living conditions of many people, also if this
organized criminal activity adversely affects good government, if it
has a generally corrupting influence upon public officials so that law-
abiding officials cannot have confidence m their Government or feel
that they have proper protection of the laws against any kind of law
violation, it is a very, very important problem from the national
viewpoint.
It has been i-epresented to the public and to the Senate of the United
States that the vehicle of interstate commerce is being used in such a
way as to make it very difficult to cope with certain types of criminal
activity on behalf of certain well-entrenched and well-financed people
and groups on purely a local basis. The chairman of the committee
and the committee feel, and join with other g(^d citizens in the view,
that law enforcement is very, very largely a local matter. People
usually get what they want. It is public interest on the part of pri-
vate citizens locally that is going to make the determination one way
or the other as to what kind of government and law enforcement we
have.
The only ])lace the Federal Government comes in is in connection
with interstate commerce, whether any laws should be amended or
improved or whether any other laws should be passed to try to prevent
the vehicle of interstate commerce being used in violation of the laws
of the States or in violation of the laws of the United States.
lO'RGAlsriZED crime: IN EMTERSTATE C'OMME'RCE 489
The committee feels tliat the testimony it has obained here in Florida
is very helpful in making this determination. ISIost of you have heard
the testimony. You have seen certain connections which, put together
with testimony we have at other places and testimony that we will
have, form an important part of the picture that we are trying to find
out about.
We have tried to conduct a fair hearing. I know that some people
may be angry at us; perhaps some people will criticize the way we
have handled this, or as to the way certain fjuestions have been asked;
but we have tried, the committee and the staif, to conduct a fair inves-
tigation in line with the resolution that was passed by Congress.
We do appreciate the interest of so many public-spirited citizens,
public officials, and we will continue to w^ork on this matter, and, of
course, conditions in Florida will play an nnportant part in our inves-
tigation until it is terminated.
I am sorry if we have called any witnesses here whom we are not
going to be able to hear at this time, l)ut, inasmuch as we must get
away very shortly by plane, it will be impossible to hear any other
Avitnesses at this time.
With thanks to all of you for assisting us, that terminates the
hearing.
(Whereupon, at 4:05 p. m., the hearing adjourned, subject to call
of the chairman. )
INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
WEDNESDAY, AUGUST 9, 1950
United States Senate, Special Committee To
Investigate Organized Crime in Interstate Commerce,
Washington^ D. C.
The committee met, pursuant to call, at 10 : 15 a. m., in room 318,
Senate Office Buildino;, Senator Estes Kefauver (chairman) presiding.
Present : Senators Kefauver, O'Conor, Hunt, and Wiley.
Also present : Rudolph Halley, chief counsel ; Harold G. Robinson,
associate counsel ; Alfred Klein and Downey Rice, assistant counsels,
The Chairman. The committee vrill come to order.
This is an adjourned hearing of the hearing of the committee in
Florida several weeks ago. At that time it was not possible to have
several witnesses present whom the committee wanted to hear. Most
of the additional witnesses that we wanted to hear in Miami are
present today. Mr. Ben Cohen was present at the meeting in Florida,
but the committee decided we would rather have him testify at the
time that other alleged members of the S. & G. Syndicate also testi-
fied. I believe today present are Leo Levitt, Harold Salvey, Jules
Levitt, Edward Rosenbaum, and also Mr. Ben Cohen. His brother,
Sam Coheii, is in town but I understand he is still suffering from heart
attacks but can come if we need to have him. And Mr. William H.
Johnston is also present.
Two other witnesses we did want to hear are Mr. John Patton and
Mr. Russell. We have not been able to sen-e subpenas on them. We
anticipated that they will be called before the committee at a later
time.
Since we were in Florida for our last hearing, the committee's
attention has been called to an AP storj' of July 26, to the effect that :
The Miami Daily News said today the Miami Beach S. & G. booking syndicate
has gone out of business officially, but the five partners are planning to resume
operations in the fall separately.
Official announcement of the end of the five-man partnership came from
Ben Cohen, attorney for the S. & G. and. brother of syndicate member Sam
Cohen, the newspaper said.
Ben Cohen said the five partners decided to end the life of the syndicate yes-
terday. The paper said the partners planned to organize five separate companies
this fall. The spots they controlled as a body will be divided equally.
Investigation by the Department of Internal Revenue was cited by the paper
as probably the biggest reason for the break-up of the multi-million-dollar
bookie syndicate. A sixth member of the syndicate, Harry Russell, of Chicago,
was not consulted, the paper said, and was believed to have pulled out of the
organization a month or two ago.
The Miami Herald said the syndicate had ordered telephones removed from
all its eight offices.
491
492 ORGAisnzED crime; ix interstate commerce
The committee, of course would be very much interested in just
what has taken place in connection with the syndicate and what opera-
tions are jDlanned in the future.
Do you have anything you want to say, Senator Wiley?
Senator Wiley. No.
The Chatrmax. Mr. Ben Cohen, will you come around? Mr.
Cohen, do you solemnly swear the testimony you give this committee
will be the truth, the whole truth, and nothing but the truth, so help
you God ?
Mr. Ben Cohen. I do.
TESTIMONY OF BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
The Chairman. All right, Mr. Halley, you may proceed.
Mr. Halley. Mr. Cohen, what is your business?
Mr. Cohen. I am an attorney at law, sir,
Mr. Halley. What is your business address?
Mr. Cohen. 604 Mercantile National Bank Building, Miami Beach,
Fla.
Mr. Halley. Where do you reside ?
Mr. Cohen. 815 West DiLido Drive, Miami Beach, Fla.
Mr. Halley. Are you familiar with a partnership known as the
S.&G. Syndicate?
Mr. Cohen. I am, sir.
Mr. Halley. Will you state what the S. & G. Syndicate is?
Mr. Cohen. The S. & G. Syndicate originally started as a group of
five boys. In 1949 they added another boy. Their business is the
financing of concessionaires at hotels at Miami Beach, Fla.
Mr. Halley. Has S. & G. Syndicate been dissolved recently?
Mr. Cohen. It definitel}^ has.
Mr. Halley. Would you state when it was dissolved and just what
happened ?
Mr. Cohen. I was called in by the five people, with the exception
of Mr. Russell, and they said, "Ben, we have decided to dissolve. We
are through with the business entirely."
I asked them whether or not they wanted me to give any statement.
They said, "No, don't give out a statement because if you do, the peo-
ple might think it is a phony. Let them find out by themselves.
When they see the phones taken out of the offices and when they see
the offices given up, they will know that it is dissolved."
Mr. Halley. When did this occur ?
Mr. Cohen. Approximately 2 or 21/0 weeks ago, a few days prior
to that article that Senator Kefauver just read.
Mr. Halley. Where was this meeting?
Mr. Cohen. They had met in their offices and they came and told
me this in my office.
Mr. Halley. All five came to your office?
Mr. Cohen. I think that was it, sir.
Mr. Halley. Was anybody else present ? Leo Levitt, for instance?
Mr. Cohen. No, sir.
INIr. Halley. There has been a re))ort in the newspapei's, as you
know, a statement that the various members of S. & G. intended to
operate on their own in the futuie. Can you comment on that?
. ORGANIZED CRIME IN INTERSTATE C'OMME'RCE 493
Mr. Cohen. I could comment very vehemently about that. The
newspapers evidently were able to sell their newspapers because they
write about S. & G. They can't afford to let the S. & G. die. They
can only afford to persecute them as long as they can. Mr. Wilson
McGee, who is here now, is the only one who tokl the truth concern-
ing that matter. I saw Mr. Daniel Sullivan of the crime commission
and asked him where he ever got the idea that they were going to
operate individually as individuals. He said to me, "I guess it was
one of my pipe dreams.'-
My answer to him was that he just took the words out of my mouth,
that I thought it was one of his pipe dreams because there is definitely
no truth to the statement that the boys had decided to operate by
themselves. In fact, I called Mr. Hoke Welch, of the Miami Daily
News, and said to Mr. Welch :
I ^^der^stand it is attributed to me that tlie boys are going to operate as
individuals. I have not seen that paper.
He repeated to me :
No. we did not quote you as saying that, Mr. Cohen, but it is ouf observation.
I have since learned, and in growing older you learn you can't
control observations of newspapers or opinions of other people.
Mr. Halley. Aside from the origin of the press report, are you in
a position to state now whether or not the individual members of the
S. & G. Syndicate have expressed any intention as to whether they
are going to continue operation on any basis whatsoever in the future?
Mr. Cohen. They have expressed an intention, and their intention
as expressed to me was that they will never engage in that business
I again.
Senator Wiley. Individually or jointly?
I Mr. Cohen. Individually, jointly or collectively, in any manner
whatsoever.
■ Mr. Halley. How did the S. & G. Syndicate originate, when and
under what circumstances?
Mr. Cohen. From my investigation made here recently, back in
1944 there was a group of Harold Salvey, Jules Levitt, and Charles
Fi'iedman who were together. My brother, Sam Cohen, was operating
I by himself, and Mr. Rosenbaum was operating by himself. It is my
I understanding that because of economic reasons they felt it would be
better for them to join as partners and operate as one group. That
took place in September, I believe, of 1944.
Mr. Halley. At that time there were six who joined the group; is
right ?
Mr. Cohen. No.
Mr. Halley. Let's see. There was Charles Friedman, is that right ?
Mr. Cohen. Yes.
Mr. Halley. Jules Levitt?
Mr. Cohen. Yes.
Mr. Halley, Harold Salvey?
Mr. Cohen. Yes.
Mr. Halley. Sam Cohen?
Mr, Cohen. That is right.
Mr. Halley. Eddie Rosenbaum?
Mr. Cohen. That is right.
p that
494 ORGANIZED CRIM'EI IN INTERSTATE COIVEVIERCE
Mr. Halley. And there was a man named William Maher ?
Mr. Cohen. I didn't know any — I know who William Maher is, but
I didn't know of him in that business.
Mr. Halley. Wasn't he in the S. & G. for a period of about a year
at the beginning?
Mr. Cohen. I don't think it was for about a year. I think it was
for a few months. Then by presidential edict the tracks closed, and
I think he got out either prior to that or immediately when the tracks
did close.
Mr. Halley. When he left S. & G. he was paid a substantial amount
for his interest, was he not ?
Mr. Cohen. That I can't answer, but he was paid some money.
Mr. Halley. About $100,000, wasn't it 'i
Mr. Cohen. I couldn't say that. I have no knowledge of that.
Their books would reflect that.
Mr. Halley. Was S. & G. organized as a partnership?
Mr. Cohen. Yes, sir.
Mr. Halley. A limited partnership, I presume ?
Mr. Cohen. What do you mean by limited partnership?
Mr. Halley. As a syndicate, there was a specific investment by
each member, but would the members continue to be liable for the
obligations of the entire syndicate to the extent of their entire finances ?
Mr. Cohen. I would think so.
Mr. Halley. You would state it would be a general partnership?
Mr. Cohen. It was a general partnership.
Mr. Halley. Mr. Cohen, can you state how S. & G. happened to
be called that?
Mr. Cohen. I have heard all kinds of rumors as to how the name was
gotten. In fact, the last one I heard was "stop and go." That would
be as good a name as any. There is no particular reason for that name
that I know of. I was not trying to be facetious with that "stop and
go." No one seems to know.
Senator Wiley. Has it stopped now to go later ?
Mr. Cohen. No ; the initials are reversed.
Mr. Halley. Wliose chose the name?
Mr. Cohen. That I would not know, sir.
Mr. Halley. Sometime after its formation you did register the
name?
Mr. Cohen. Yes, I did.
Mr. Halley. In the city of Miami Beach; is that right?
Mr. Cohen. Yes, sir.
Mr. Halley. Acting as attorney or agent for the S. & G. ?
Mr. Cohen. As attorney for them.
Mr. Halley. Have you acted as attorney for them since its incep-
tion?
Mr. Cohen. Yes, I have.
Mr. Halley. What other professional persons have worked for S.
& G. ? Who is their accountant ?
Mr. Cohen. You mean at the present time?
Mr. Halley. Who was originally and who is now?
Mr. Cohen. There was a man by the name of Art Davis. Art had
been their accountant for years, and he got killed in an automobile
accident about a year or a year and a half ago. I don't know the exact
lORGANIZED CRIMEA IN mTERSTATE COMMERCE 495
time. Then I understand that the ^YOl■k was turned over to Louis Gill-
man. They have done no work since then.
Mr. Halley. After S. & G. was set up, it had offices in various places ;
is that right?
Mr. Cohen. Yes ; they had offices in various places.
Mr. Halley. Wliere was the main office ?
Mr. Cohen. The main office was at the Mercantile Bank Building
Annex. That is another building that was put up after the original
Mercantile Bank Building, and this 'building connects on to the origi-
nal bank building, but faces on Washington Avenue instead of Lin-
coln Road.
]Mr. Halley. They also had branch offices scattered around the
beach ?
Mr. Cohen. They had different type offices around the beach. The
other type offices, I am told, are where they received the information
from the concessionaires as to the wagers that the concessionaires
accepted.
Mr. Halley. They had an office where Rosenbaum operated, is that
right?
Mr. Cohen. Rosenbaum was at the Mercantile Bank Building office.
Mr. Halley. Didn't he have a penthouse office on top of one of the
hotels?
Mr. Cohen. No ; not that I know of. Rosenbaum was always at the
Mercantile Bank Building.
Mr. Halley. Wasn't there a penthouse on top of one of the hotels
on the beach where he operated a telephone exchange to exchange in-
formation with bookmakers over the country on hot horses ?
Mr. Cohen. I wouldn't know of that, sir.
Mr. Halley. He is here and we can ask him.
Mr. Cohen. Yes.
Mr. Halley. What was the business? Would you describe it in
detail ?
Mr. Cohen. Yes ; the concessionaire would take a concession or cigar
stand, whatever name you want to call it, at a hotel. He would then
come to the S. & G. offices where they would form an agreement whereby
they were the bankers for him. The concessionaire paid for the hotel
out of his own pocket. That was his own expense. He hired his own
help and paid for whatever there was around the business. He in turn
would call in his bets to the S. & G., one of their offices. At the end of
each month or whatever period it would be — I don't know exactly how
they operated that, but the books reflect it — they would deduct the
expenses from the profit and divide it 50-50.
Mr. Halley. These concessionaires were bookmakers; is that right?
Mr. Cohen. That is right, sir.
Mr. Halley. They would take bets on horse races ?
Mr. Cohen. That is right.
jNIr. Halley. As far as you know, they would take them contrary
to the law of the State of Florida ; is that right ?
Mr. Cohen. That is correct. They did that.
Mr. Halley. I believe the Governor of Florida only 2 or 3 days
ago made a statement saying that every bet taken outside of the
parimutuels on the track deprived the State of Florida of a certain
amount of revenue that was due on taxes on horse bets ; is that correct?
496 ORGANIZED CRIME: IN INTE;RSTATE COMME^RCE
Mr. Cohen. Pie may have made that statement, but it is prob-
lematical whether it is right or not.
Mr. Halley. As far as you know, the concessionaires and agents
for S. & G. did not pay any tax on their bets, did they ?
Mr. Cohen. That is correct.
Mr. Halley. A particular bookmaker would operate in a hotel or
in some other premises ; is that right ^
Mr. Cohen. That is correct, sir.
Mr. Halley. He would pay his own rent, you have testified. Is it
not a fact that in many cases S. & G. did participate in the rent?
Mr. Cohen. They w^ould allow him a certain portion of the rent
to be taken from the profits. That would go to him.
Mr, Halley. In each case S. & G. participated in the profits; is
that right ?
Mr. Cohen. Yes,
Mr. Halley. How did they participate?
Mr. Cohen. The first moneys that were taken off were given to the
concessionaire toward his rent on an agreed amount between the
concessionaire and the S, & G. Then there was a charge for the
service. Then there was a charge for operating expense. The net
profit was divided equally between them,
Mr, Halley, I would like to try to get it into a more concrete form.
Your testimony is not objected to in its general form, but let us see
if we can break it down on the daily operations. A bookmaker would
receive bets during the course of the day from various of his customers.
Mr. Cohen. That is right.
Mr. Halley. He would note these bets on a 30-line sheet.
Mr. Cohen. I wouldn't know. He would note the bets,
Mr. Halley, He would have a sheet of paper on which he did it.
Mr. Cohen. Y^'es ; that is correct, sir.
Mr. Halley, That sheet of paper was supposed to reflect accurately
every bet he took ?
Mr. Cohen. That is correct, sir.
Mr. Halley. As soon as he took the bet he was supposed to telephone
that into an S. & G. office; is that right ?
Mr. Cohen. That is correct.
Mr. HaLuey. So there was immediate contact with S. & G. on every
bet.
Mr. Cohen. Yes.
Mr. Halley. At the end of the day he either had a certain profit
or loss.
Mr. Cohen. That is right.
Mr. Halley. When he finished ])aying off his customers. At that
point an S. & G. agent w^ould come to the ])articular bookmaker's
premises and pick up the entire bahmce in cash; is tliat right?
Mr. Cohen. No; if he lost money that day he would come to Leo
Levitt, who was the cashier*, and get money from Leo to pay off the
people that he had lost to. If he won money he w^ould come and pay
Leo the money that he had won. The S. & G. acted as trustees or
custodians of the money until the time at which they wouhl divide
their profits.
Mr. Halley. Then each day there would be also deducted from the
bookmakers' share certain expenses ; is that right ?
ORGANIZED CRIME IX INTERSTATE COMMERCE 497
Mr. Cohen. That is correct.
Mr, Halley, There were two expressions, off the top and off the
bottom. Are you familiar with them?
Mr. Cohen. No ; I am not. Off the top and off the bottom ?
Mr. Halley. In effect, certain expenses were taken off the total
profit so that the expense would be shared equally by S. & G. and the
bookmaker; is that right?
Mr. Cohen. Yes ; those were expenses which the concessionaire had.
They were his private expenses, and they were allowed by the S. & G.
to the concessionaire.
Mr. Halley. For instance, if a bookmaker in the course of the day
booked a thousand dollars in bets and paid out $()U0 he would have
$400 left.
Mr. Cohen. That is correct.
Mr. Halley. Out of that $400— first, we will say the $400, if there
were no expenses, would be split 50-50, $200 to S. & G. and $200 to the
bookmaker; is that correct?
Mr. Cohen. No; he would get a credit for the $400. What I meant
to say, Mr, Halley, is that they wouldn't do it each day. It would be
done at the end of a period of time.
Mr. Halley. Each dav the $400 would be just turned over to S. & G.
to hold?
Mr. Cohen. That is correct.
Mr, Halley, He would have nothing?
Mr, Cohen. He would have credit.
Mr. Halley, He would have a credit,
Mr. Cohen. That is correct.
Mr. Halley. Then the expenses were taken as follows : There were
some off the top, and I think that is the expression that is used.
Mr. Cohen. On the top. Not off the top, on the top.
Mr. Halley. On the top. They would include, for instance, the
charge for wire service, is that right ?
Mr. Cohen. I imagine that is the way it was handled. I think it
w^as.
Mr. Halley. The wire service being provided by S. & G.
Mr. Cohen. That is right.
Mr Halley They would also include a certain allowance made for
his employees, is that correct ?
Mr. Cohen. That is correct,
Mr, Halley. He would be allowed one or two employees?
Mr. Cohen. It isn't what he would be allowed. If his place called
for hiring two or three or four employees, he would take it up to the
S. & G. and the S. & G. would allow that as his expense. They agreed
on that particular place, that it did require so much help. The con-
cessionaire in turn paid the man. He would hire the man and he
would pay him and he would pay his social security and whatever
other charges there were,
Mr. Halley. In other words, the expenses that were allowed to be
deducted from this theoretical $400 were expenses which had to be
agreed to by S. & G., isn't that correct?
Mr. Cohen. That is correct.
Mr. Halley. In addition to that, fines that were paid as a result of
arrests and convictions were taken off the profit, is that correct ?
498 ORGAlSnZED CRIME' IN INTERSTATE COMMERCE
Mr. Cohen. Fines were charged, as I understand it — and I have
talked with the boys about this — fines were charged to the concession-
aire and allowed as an expense against his business.
Mr. Halley. In other words, S. & G. bearing its half of the expense
out of its share of the profit.
Mr. Cohen. It eventually came out of their net which was the wins,
but it was the expense of the concessionaire and not the expense of the
S. & G. It did eventually show up in the net profit of the S. & G.
Mr. Halley. Assuming that at the end of a period of time there
would be an accounting and a certain amount would be found due to
the bookie.
Mr. Cohen. Yes, sir.
Mr. Halley. On the basis of his 50 percent after the deduction of
this type of expense.
Mr. Cohen. Yes
Mr. Halley. There would then be certain other expenses deducted
from the bookie's 50 percent, is that correct?
Mr. Cohen, That is correct.
Mr. Halley. What would they be ?
Mr. Cohen. It all varied on the type of place he had. The service
was deducted.
Mr. Halley. What is the service?
Mr. Cohen. The service is the news giving the odds on the different
horses and the results of the races. The S. & G. would purchase that,
and they in turn would sell it to their agents.
Mr. IIx\lley. How do you distinguish that from the wire service?
Mr. Cohen. It amounts to the same thing.
Mr. Halley. There were two. There was the wire that was taken
on the top, as you say.
Mr. Cohen. And then
Mr. Halley. And then the service was taken off the bottom, off the
bookie's own share.
Mr. Cohen. Xo, there was nothing off the bottom. Leo Levitt will
be able to explain this. I think you have in mind the operating
charge.
Mr. Halley. Yes.
Mr. Cohen. This was a charge that they had made to the conces-
sionaire which was to include the clerks and the different expenses
that the S. & G. had in servicing these accounts. I know Mr. Leo
Levitt will know more about it because he is the one who handled
that service charge. He can explain it a lot more intelligently than
I would be able to.
Mr. Halley. But that type of expense came right off the bookie's
percent ?
Mr. Cohen. That is right, sir.
Mr. Halley. Rather than being shared between S. & G. and the
bookie.
Mr. Cohen. Well, at one time, as I understand it, that was on the
top, in which the S. & G. shared witfi it, too. But I understood that
some of the concessionaires, if the amount just for argument's sake
was $100, $50 of it was the concessionaire's ultimate cost to him and
$50 ultimately was the cost to the S. & G. But they went around yell-
ing, they are robbing me for $100. So they finally agreed on a method
ORGANIZED CRIAHE' IN" INTERSTATE COMMERCE 499
whereby they paid $50 themselves out of their own pocket, as they
called it, so they couldn't tjo yelling that they were robbing me out of
$100. Have I made myself clear, Mr. Halley?
Mr. Halley. Yes.
Senator Wiley. Where did you get the news from ?
Mr. CoiiEX. They got the news from a wire service. I think Mr.
Eobinson knows all about that. We have tried to cooperate so he
can get all of that information. They purchased the news at one time
from a man named Dave Burns, who is in Miami Beach at the present
time, I am sure.
Senator Wiley. Wliom did they pay. Burns?
Mr. CoiiEX. I think it was Mr. Burns. It was all paid by check
and Mr. Robinson has all of that information.
Senator Wiley. Continental was out of there for 2 years or more,
was it not?
Mr. Cohen. I am not acquainted with the different services.
Senator Wiley. That is all I have.
Mr. Halley. For the record at this time it should probably be stated
that all of the books and records of S. & G. Syndicate were made fully
available to the committee's investigators in Miami during the last
week; is that correct?
Mr. Cohen. That is correct, sir.
Mr. Halley. We have had extracts made from them and certain
records photostated at the discretion of the committee; is that correct?
Mr. Cohen. Yes ; that was the understanding, that it would be avail-
able to you for that purpose.
Mr. Halley. You have described the financing of the bookies. I
don't quite understand it. It looked to me as though you were in
partnershij) with the bookies or in fact as though they really worked
for S. & G.
Mr. Cohen. No, they didn't work for S. & G. at all. The S. & G.
never accepted a bet from anyone. They never paid an individual
a bet.
Mr. Halley. Is that right ? Weren't there certain bets that bookies
did not book themselves because they were too large and the bookie
was advised not to take them?
Mr. Cohen. Yes, there were lay-off bets.
Mr. Halley. Who took them ?
Mr. Cohen. The office would take that.
Mr. Halley. Isn't that S. & G. ?
Mr. Cohen. Yes, that is true. But that is not the bulk of their
business. The bulk of their business was the recording of the wagers
that the concessionaire accepted at the place.
Mr. Halley. Why would the bookies want to pay S. & G. half their
profits ? Just what did they need S. & G. for?
Mr. Cohen. For the financing of the whole thing.
Mr. Halley. AYliat financing did they need ?
Mr. Cohen. In looking over the records it takes money to go into
business.
Mr. Halley. What money did you provide to these bookies? A
great many of them had very substantial assets.
Mr. Cohen. There are a great many of them who had to borrow
money from the S. & G. on which to carry on business even before they
got their check. They were financed that way.
500 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. And a great many more had plenty of money and
didn't need S. & G. at all, isn't that so ?
Mr. Cohen. Well, it could be so.
Mr. Halley. Isn't it so ?
Mr. Cohen. I would not say that.
Mr. Halley. You have some very substantial bookmakers.
Mr. Cohen. That I wouldn't know. I do know of some places that
weren't serviced by S. & G., one place in particular, wliere the man
who took it on his own got hit with some bets and he went away leaving
the hotel just to take care of it, no matter which way they could.
Mr. Halley. We are not talking about the isolated cases where
S. & G. didn't operate. We are talking about the cases where S. & G.
did. You actually operated in approximately 200 locations, isn't that
right?
Mr. Cohen. I wouldn't say that. I wouldn't know.
Mr. Halley. The average is 192. It includes, does it not, practically
every hotel on the beach ? We have a list here.
Mr. Cohen. I wouldn't say it includes every hotel. In reading
Wilson McGee's article he named five other syndicates that were on
Miami Beach. They are smaller.
Mr. Halley. They are much smaller ?
Mr. Cohen. That is correct, sir.
Mr. Halley. What I am trying to find out is why a bookie would
be willing to pay S. & G. a telephone charge, a service charge, and then
give up half of this ])rofit ? At least one bookie testified that he did it
most reluctantly and only because he was persuaded that if he didn't
do that, he would be continuously arrested until he was put out of
business.
Mr. Cohen. That persuasion did not come on the part of the S. &
G.?
Mr. Halley. He stated that it came from ]Mr. Rosenbaum, and that
finally only at the intervention of Mr. Friedman, who was a friend of
his, was he excused from the service charge and allowed to continue
simply by splitting his profit with the S. & G.
Mr. Cohen. Mr. Halley, I don't want to be in the position of at-
tempting to discredit a witness of yours, but Mr, Frenchie Gibbs has
brought to my attention through others — and I know this is false.
I want to put it straight, gentlemen. I know it is false. He says they
had me doped up, I didn't know what I was saying. I didn't tell the
truth.
Mr. Halley. He didn't testify before this committee that he was
doped up.
Mr. Cohen. No, of course not. I think the man is thoroughly irre-
sponsible. He said that on the outside after the meeting of the com-
mittee.
Senator Wiley. Who did he mean by "they" had him doped up ?
Mr. Cohen. He didn't say who he meant, but his inferences were,
they were so ridiculous that no one paid any attention to them.
Mr. Halley, Don't you think he was afraid of reprisals ? For your
information the committee had his statement as well as the statement
of a great many other bookies considerably before that time, and there
are no discrepancies. He was not doped by anybody before the hearing
because his statement jibed very closely with previous statements made
by him and other bookies.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 501
Mr. CoiiEx. It sounded so ridiculous, his statement about being
doped up, it wasn't Avorthy of repeating.
Mr. Halley. Of course he was just scared of reprisals. It is per-
fectly obvious.
Mr. Cohen. No, Frenchie was not scared of reprisals. Fi'enchie
knows that nobody would hurt Frenchie, that he has lived oft' of all
those boys for the past 25 years, on and off, either those boys or friends
of those boys.
]\Ir. Halley. Somebody might arrest him and put him out of busi-
ness.
Mr. Cohen. If he were to be granted immunity for the rest of his
life and be allowed to go in the gambling business because he came
down to the Senate investigating connnittee, then that is poor reason-
ing, I think.
Mr. Halley. Isn't that in fact what the business of S. & G. was?
Let's get back to S. & G. Isn't it a fact that a great many of these
bookmakers were in the bockmaking business and financing themselves
quite satisfactorily before S. & G. was organized?
Mr. Coiien. No. I wouldn't say that.
Mr. Halley. There were bookmakers in Miami before S. & G. was
formed, weren't there, a great many?
Mr. Cohen. Yes, I would say there were.
Mr. Halley. And they were operating. There weren't any noted
cases of defaulting on their debts. The public was betting with them
and they were paying off their bete.
Mr. Cohen. There were isolated cases of defaults in the payment
of wagers, yes.
Mr. Halley. Then S. & G. was organized, and all of these bookies
i suddenly found themselves partners of S. & G.
; Mr. Cohen. No. Let me explain that. S. & G. wasn't suddenly
organized. S. & G. was just suddenly formed, which only meant the
bringing together of three different factions. That was all.
Mr. Halley. Each of these factions had the wire service, did they
not?
Mr. Cohen. No. Each of these factions purchased wire service.
Mr. Halley. And had an exclusive right to distribute it.
Mr. Cohen. Oh, no, no, no.
Mr. Halley. Can your bookies get wire service except through
' S. & G. ?
Mr. Cohen. Oh, yes. Every one on Miami Beach.
I Mr. Halley. How do they get it except through S. & G. ?
Mr. Cohen. "Why, th.e five names that were in the paper purchased
'their wire service and certainlv did not have any business dealings
with the S. & G.
jNIr. Halley. There have been some people who managed to bootleg
[wire service.
Mr. Cohen. No.
]Mr. Halley. The 191 locations got their wire service from S. & G.,
did they not ?
Mr. Cohen. Yes, they did; but Mr. Halley, let me correct your
thought, please. If you feel that S. & G. had a right to all of the
wire service on Miami Beach, you are incorrect in your thoughts there.
Mr. Halley. No; it is perfectly clear that some other people also
502 ORGANIZED CRIME' IN INTERSTAT'E COMMERCE
had a deal, but isn't it also perfectly true that the individual book-
maker couldn't get wire service; he had to come to you or to somebody
else, and S. & G. managed to get the biggest slice of the monopoly^
Mr. CoHEisr. I will say this, that the concessionaires who dealt with
the S. & G. found it was far cheaper to buy it from the S. & G. than
to go to the service directly and buy it.
Mr. Halley. That is exactly right. The service was made exorbi-
tant for them and it was simply impossible to get it directly.
Mr. Cohen. I wouldn't say that, Mr. Halley. When the service was
paid quite a substantial amount for that service by the S. & G. I
think in checking with Mr. Eobinson it was something like $10,000
a month at one time, wasn't it ? Something like that.
Mr. Halley. It ran as high as that in the wintertime and it ran
nuich lower at other times.
Mr. Cohen. Naturally, if they had 191 spots, they could apportion
that off far cheaper than an individual could buy service himself. It
is the same as your wholesale buying at the A. & P. or any other store.
Mr. Halley. They preferred to deal with a single distributor; is
that right?
Mr. Cohen. When you say "they," you mean the wire service ?
Mr. Halley. Yes.
Mr. Cohen. I wouldn't know what their plans were, but I imagine
it would be better business if you could deal with a few than with a
great many.
Mr. Halley. It is always better business to monopolize and keep
the little fellow in a position where he has to come to you? Isn't
that the best way to do business ?
Mr. Cohen. No ; from what I know of it, I don't see any connection
between that at all.
Mr. Halley. Wliat happened when the wire service was cut off in
1949 ? You recall it was cut off for a period of about 3 weeks.
Mr. Cohen. No.
Mr. Halley. We have the figures on it. It was cut off from the
20th of February until the 4th of J^Iarch. That would be 2 weeks.
Mr. Cohen. Two weeks? They still got service.
Mr. Halley. Who still got service?
Mr. Cohen. The S. & G. got service.
Mr. Halley. Why did the S. & G. do no business during that period ?
Mr. Cohen. They did business.
Mr. Halley. The records show that they did not do business. Their
own records show that.
Mr. Cohen. Then you will have to ask Mr. Levitt about that. I
wouldn't know the exact dates.
Mr. Halley. I show you a total in's by day from January to April
1949, taken from your own books, and ask you if it isn't a fact that
during that period there were no in's?
Mr. Cohen. Where would the news be?
The Chairman. In the center column.
Mr. Robinson. Those are all in's.
Mr. Halley. Those are all in's.
Mr. Cohen. These are all in's?
Mr, Halley. Yes; total in's.
Mr. Cohen. I see. I would have no explanation for that. They
must have been closed.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 503
■ Mr. Halley. It would appear that they were closed.
Mr. CopiEN. Yes, that is what it would make me believe from looking
flt tins.
Mr. HiViiLEY. When S. & G. was closed, its bookies were closed'^
Mr. LOHEN. I M'ould say that when the concessionaires closed there
was nothmg for the S. & G. to do.
T ^?:, ^/';'^I- ^}^^^ ^^^ ^^ose^ because they had no wire service.
Isnt that the fact?
Mr. Cohen. I wouldn't say it was because of no wire service.
Mr. Halley. You can't operate without the wire service?
Mr. Cohen. Yes, they can, but not as— you won't get as eood a
turn-over of money. *=■
Mr. Halley. It is too dangerous without the wire service, isn't it?
Un ess you have the up-to-date results somebody is apt to come in and
make a bet on the basis of the timing and just win too much money
from the bookie. -^
Mr. Cohen. No, they couldn't do that.
Mr. Halley. They just don't operate without wire service, do
tney « '
Mr. Cohen. They can.
Mr. Halley. But they don't.
Mr. Cohen. I wouldn't say that they don't.
Mr Halley. They didn't when your service was cut off. Let's put
it that way. ^
Mr. Cohen. Let's say they didn't, all right, but they can.
Mr. Halley I here is another reason, isn't there, besides the wire
service that a bookie would want or have to deal with S & G «
Mr. Cohen. No other reason that I know of.
c ¥^>.^'^^^^^- -^'^^'^^ ^^ generally reputed in Miami Beach that the
b. 6c G. bookies are permitted by the local police department to oper-
1 ate, they are not shut down ? ^
Mr Cohen. I couldn't say that that is the reputation of the general
talk, because tney have been shut down on numerous occasions
.1, :i ^^^^^- ^^^' ^^^y ^^® arrested and they pay certain fines and
ithen they continue operations.
Mr. Cohen. No, they close up, too.
Mr. Halley. That is the rare exception, is it not ?
Mr. CopiEN. No, it is not.
_Mr. Halley Didn't the S. & G. continue its one hundred and ninety-
3 thrDd'kS ' '^ ^ ^^''''^ without appreciable interruption
Mr. Cohen. No, they did not, sir.
Mr. Halley. They started in 1944, didn't they ?
Mr. Cohen. That is right. ' '
^ Mr. Halley. In 1950 they were still operating a great many loca-
lons despite a tremendous amount of pressure from all sources to
shut down the gambling.
^ Mr. Cohen It is true that they continued their operations in the
inancmg of these bookies right up until 1950, but there had been
imes, many times, that they were closed and times when they were
)pen, most of the time open. "^
Mr. Halley. That would depend on how great the heat was?
08958 — 50— pt. 1 33
504 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Cohen. That is correct. That is the yardstick, the amount of
heat. You will find police officers at times will go — they go on active
raicls. What I mean is, they go out with axes and tear up a place.
Mr. Halley. S. & G. was able to control the heat, was it not?
Mr. Cohen. No, they were not.
Mr. Halley. S. & G. had friends on the Miami Beach council, did
it not?
Mr. Cohen. When you say S. & G. had friends, that is a little'
indefinite. If you will ask me who, I will tell you that. Whenever you
say S. & G.
Mr. Halley. The Miami Beach is run by a city council, is it not?
Mr. Cohen. That is right, a city manager form of government.
A city council with a city manager.
Mr. Halley. The city manager takes his instructions from th©
council, is that correct ? /
Mr. Cohen. Yes, sir.
Mr. Halley. The chief of police in turn takes his from the city
manager.
Mr. Cohen. That is correct.
Mr. Halley. You have heard the testimony — I think you sat
through the hearings in Miami ?
Mr. Cohen. Yes.
Mr. Halley. That the chief of police said he either opened or shut
the town depending on what the city manager told him to do. Is that
correct ?
Mr. Cohen. I don't want to say that is correct or not because that
is not my best recollection.
Mr. Halley. Wasn't it testified, for instance, that when instructions
went out to shut the town, Chief Short was able to go out and do it
in 2 hours, and shut every bookie in Miami Beach, or practically
every one ?
Mr. Cohen. My recollection of Chief Short's testimony was that
he said "I don't want to have anything to do with that." That was
just like a hot potato and he didn't want to touch it.
Mr. Halley. That is exactly right. He left it to a man namedi
"Perdue."
Mr. Cohen. That is correct.
Mr. Halley. Who is just an ordinary detective on the force.
Mr. Cohen. That is right.
Mr. Halley. He felt it was such a hot potato altliough he was chief
of police, he didn't want to fool with it.
Mr. Cohen. He wanted to be chief of police of everything except
booking.
Mr. Halley. How would you explain that?
Mr. Cohen. It is a little bit difficult to explain the other man's
mind, Mr. Halley.
Mr. Halley. You appeared for S. & G. almost exclusively on their
arrests for bookmaking, did you not ?
Mr. Cohen. That is right.
Mr. Halley. You were the counsel not only for S. & G. but you
appeared for all of these bookmakers ?
Mr. Cohen. That is right, and quite a few that did no business
with the S.&G.
ORGANIZED CRIME: IN LNTTEHSTATE COMMERCE 505
Mr. Halley. You are a lawyer.
Mr. Cohen. Yes. I take any case tliey will pay me for.
Mr. Halley. Fine. Naturally. But you did the work almost ex-
clusively of S. & G. ?
Mr. Cohen. That is correct, sir.
Mr. Halley. When these bookies were arrested j^ou appeared in
court for them ?
Mr. Cohen. That is right.
Mr. Halley. You argued their case and arranged for their bail ?
Mr. Cohen. No, I never arranged for their bail.
Mr. Halley. How was that handled ?
Mr. Cohen. They would arrange their own bail and if they called
I me I said "Come up to the office and we will discuss it."
Mr. Halley. And that was occasionally done, is it not so ?
; Mr. Cohen. Not occasionally, quite often.
i Senator Wiley. Whatisthesizeof the ordinary fine?
Ij Mr. Cohen. They varied. Do you mean in our State courts or in
i our municipal courts there ?
! Senator Wiley. Both.
[I Mr. Cohen. In the State courts they ran at $400 and costs. In
ti the police court they started with $200. The regular judge started
! with $200
Senator Wiley. Jail sentence?
Mr. Cohen. No. They always had an associate judge, and he
v/anted to shoAv that he was doing something, so he would raise the
price.
Senator Wiley. No jail sentence on a repeater ?
Mr. Cohen. On repeaters, yes. In the criminal court of record, the
customary thing that Judge Willard does is $400 on the first offense,
and $600 on the second offense, and he says bring your grip for the
third offense.
Senator Wiley. The fines paid in the municipal court went to the
municipality, is that correct ?
Mr. Cohen. Tliat is correct, sir.
Senator Wiley. How much of the State fines went to the munici-
pality ?
Mr. Cohen. None.
Senator Wiley, What was the municipality's take in a year on the
fines?
Mr. Cohen. I have no idea, sir.
Senator Wiley. May I ask a few more questions?
The Chairman. Yes, Senator.
Senator Wiley, I was interested in something you said previously.
[ think you said the S. & G. organization resulted out of a consolida-
ion of three different interests, is that correct?
Mr. Cohen. That is correct, sir.
Senator Wiley. At the time they were operating individually, how
nany bookmakers did each control at that time or have connection
vith? Do you see what I mean?
Mr. Cohen. I couldn't state with positiveness. Senator, but I can
enture a guess for you if you care to have it.
Senator Wiley. Wliat is our guess?
506 ORGANIZED CRIME' IN INTERSTATE OOMME'RCE
Mr. Cohen. I would say that Mr. Rosenbaum had in the neighbor-
hood of 30 or 40, that Sam Cohen had in the neighborhood of 50, and
that the other three had in the neighborhood of 100.
Senator Wiley. Where was each getting his news?
Mr. Cohen. Each was purchasing separately from the wire service.
Senator Wiley. From the wire service. Were there any independ-
ent bookmakers at that time?
Mr. Cohen. Oh, yes.
Senator Wiley. How many in Miami Beach?
Mr. Cohen. I would say five or six more.
Senator Wiley. Just five or six?
Mr. Cohen. Yes.
Senator Wiley. After the consolidation how many did the con-
solidation do business with ? I think you testified here to that. 191 ?
Mr. Cohen. Yes, sir.
Senator Wiley. How many independent?
Mr. Cohen. Still five or six more.
Senator Wiley. Just five or six.
Mr. Cohen. Five or six separate ones, yes.
Senator Wiley. Where did they get their news?
Mr. Cohen. From the wire service itself.
Senator Wiley. Did the independents have any connection with
S.«&G.?
' Mr. Cohen. None whatsoever.
Senator Wiley. When these three were operating independently,
did they get a take of 50-50, too ?
Mr. Cohen. Yes, sir.
Senator Wiley. And the result of the consolidation, according to
your own figures, was multiplication of bookmakers?
Mr. Cohen. That is right, sir.
Senator Wiley. In other words, you really accelerated the busi-
ness?
Mr. Cohen. They had been competing — prior to this time they were
interested in the spots, the concessionaires, and some of them had
taken concessions or given the concessionaire considerable money.
They were offering inducements. By consolidating the business they
stopped them from competing against each other. They were the
three big groups on Miami Beach. They got together to stop their
own competition.
Senator Wiley. Apparently with the increase in number of book-
makers, the income increased correspondingly to S. & G., did it not?
Mr. Cohen. I would say so.
Senator Wiley. I suppose the record shows what their take was
in 3^ears past. You have that?
Mr. Cohen. Yes, you have that.
Senator Wiley. What would it amount to in a year in round figures ?
Mr. Cohen. I wouldn't know that, sir.
Senator Wiley. In Florida is there any way to gamble legitimately
on races ?
Mr. Cohen. Just at the race track.
Senator Wiley. And out of the race-track gambling the State gets
a certain take ?
Mr. Cohen. That is right, sir.
ORGANIZED CRIME! IN INTERSTATE COMMERCE 507
Senator Wiley. This was a way to circumvent the State's take, but
apparently provided a way through the municipal court for the city
to get a take.
Mr. Cohen. No. We, there, have a different theory of it, Senator.
People will go to the race track w^ho want to go. If you want to make
a bet and don't want to go to the race track, you are not going out to
the race track just to make a bet. We feel that the money that was
bet at those places would not have reached the race track, that the
people just wouldn't have wanted to go. Of course, there may be a
fallacy to that reasoning, and it is a debatable question anyway on
whether they would go. If a man was lying on the sands in front of
the hotel, he just didn't want to go to the race.
Senator Wiley. I understand that. Just one or two other questions.
The first, Is there any legitimate way that the bookmaker and the
fellow who gambles with the bookmaker could pay the tax?
Mr. Cohen. Xo.
Senator Wiley. So there is no legitimate way that way. That has
not been provided for. It is a sort of monopoly at the track.
Mr. Cohen. That is correct.
Senator Wiley. Wliy would these five independents still remain out
in the cold and not join the S. & G. set-up ?
Mr. Cohen. They didn't have to. They had their own.
Senator Wiley. I understand, but what is the advantage of it?
Mr. Cohen. I don't know what their advantage was. I don't know
whether they were invited in. I just don't know why. They evidently
wanted to be by themselves.
Senator Wiley. You claim that the advantage to those who joined
the set-up was that you thought it reduced the overhead cost of the
individual.
Mr. Cohen. That is right, but after they got together. Senator,
they didn't go after the concessions at all. The concessionaire was the
one who went for his own spots and they didn't have to lay out the
money for the different concessions.
Senator Wiley. Do you mean to say the members of the S. & G.
didn't go after the bookmakers?
Mr. Cohen. No ; they didn't go after the concessions at all.
Senator Wilfj. They did not go after them ?
Mr. Cohen. Xo. Wemay be talking at different things. From your
smile, I don't think you understand what I am trying to bring out
and I am not answering your question.
When they got together they didn't attempt to purchase these con-
cessions. They were not in the concession business. They had their
fingers burned in 1944 when money was paid on concessions and then
by presidential edict they had no racing on the tracks and they just
couldn't get their money back. They decided then that they were not
going to take any concessions at all, that they weren't going to have
anj^thing to do with it. If there was a gamble on whether anyone
was allowed to operate or not operate, that was the gamble that the
concessionaire took. He was in the gambling business.
Senator Wiley. I understand the situation to be this : That the five
independents got 100 percent of the profit. Those that joined up
with you people had to split 50-50 with you, is that correct ?
Mr. Cohen. No. The five people never got 100 percent. They
508 ORGANIZED CRIME IN INTERSTATE COMMERCE
always liad concessionaires. What they did was advance the money
for them, and they stopped all that.
Senator Wiley. Perhaps we didn't quite understand each other.
When you say five independents, do you mean five independents like
the S. & (t. or do you mean five independent concessionaries ?
Mr. CoiiEN. When you said five independents I thought you meant
five members of the S. & G. I did have them confused. I did have
them confused at this time.
The five separate independent people conducted a business similar
to the S. & G.
Senator Wiley. How many concessionaries do they control ?
Mr. Cohen. I don't know exactly, but I would imagine that they
would control in the neighborhood of 100. There is approximately
350 hotels on the Beach. They would control approximately 150.
Senator Wiley. What are their names ^ Do we have that ?
Mr. Halley. No, we don't. We don't know of any five.
Mr. Cohen. I would dislike vehemently to be the person to tell
that. I wish you wouldn't ask me that, please. The papers in Miami.
I would feel a lot better
Senator Wiley. They are still in business, you mean?
Mr. Cohen. That is right.
Senator Wiley. You people have gone out of business for good?
Mr. Cohen. That is right. They can have it all.
Senator Wiley. Just why did you go out of business?
Mr. Cohen. Senator, we thought that we had five nice fellows who
liad lived there for 25 years. Each had his own family. They have
turned out to be the worst monsters that ever lived. Capone is nothing
to these boys now. He is small. We had war news the other day, but
three-quarters of the page was S. & G. books raided by grand jury in
Miami. Every one of these men, with the exception of Mr. Salvey
and ISIr. Rosenbaum, have children. Mr. Levitt's children are going
to college. My brother's children are young. Leo Levitt, working
for them, has children. Charlie Friedman has a son in college and
another one about to go to college. With the publicity and the way
they are painting these boys as the worst monsters in the world, they
have them hooked up with prostitution, which the Lord knows they
never had anything to do with, and with narcotics. They have had
them hooked up with every, oh. abominable crime that you can think
of. It is true that they have been law violators. Technically they
may be. I may successfully defend them in that. I don't know. I
understand you gentlemen are lawyers. You never can tell the out-
come of a case. But they have never gone any farther than that. To
fight the world, it isn't worth it.
Senator Wiley. When you spoke about the folks paying fines, you
mean the individual concessionaires came in and paid fines?
Mr. Cohen. That is correct, sir.
Senator Wiley, Has S. & G. been called before the courts in any
respect? Or paid any fine?
Mr. Cohen. No. There would never be anj?^ occasion for that. Sen-
ator, because they never accepted a bet.
Mr. Halley. You testified differently, that they took lay-off bets.
Mr. Cohen. Except on lay-off bets, yes.
Mr. Halley. Pardon the interruption. They were the big bets,
thouffh.
ORGANIZED CRIME! IN INTERSTATE COIVIMERCE 509
Mr. Cohen. Let me explain their offices at the Mercantile Bank
Bnildino-. You have heard certain expressions read in the paper, big
swank offices. AVliy weren't they raided? If they had been raided,
Senator, there was not a thing of gambling there whatsoever, not one
iota of anything. The same people who were yelling, "Why don't you
raid the S. & Gf. ?" know that there was nothing that could be done.
Mr. Richards, who ran for the council, stood down in front of the
S. & G. office across the street and said, "The day that I am elected, the
next day I Avill raid these offices over here." He has not been there yet.
Senator Wiley. You said these other five independents, like the
S. & G., if you want to call them that, had, in your mind, something
over 100 concessionaries or bookmakers operating. Have they been
arrested at times, too ?
Mr. Cohen. No.
Senator Wiley. WTiat?
Mr. Cohen. You mean the separate, who had offices? No; they
weren't arrested.
Senator Wiley. You said the bookmakers came in and paid fines,
and you would represent them.
Mr. Cohen. Yes.
Senator Wiley. If the}' were tied up with the S. & G. You said
there were five other independent operators down there, like the S. & G.,
who had bookmakers tied up with them.
Mr. Cohen. Yes.
Senator Wiley. Have their bookmakers been brought in?
Mr. Cohen. Oh, surely.
Senator Wiley. So there has been no favoritism shown between your
bookmakers and the other fellows' bookmakers ?
Mr. Cohen. Oh, no. What I meant was the principals, the people
who backed them financially, were not fined.
Senator Wiley. I understand. I just wanted to find out.
Mr. Cohen. No; there has been no favoritism on that.
Senator Wiley. Is there any evidence to show whether the S. & G.,
or any of the other independent guys like the S. & G., have been paying
money to anybody for protection or for anybody ?
Mr. Cohen. No, sir.
Senator Wiley. Thank you, Mr. Halley.
Mr. Halley. First of all, you keep insisting that you were simply
financing these bookmakers. That is just not so, is it?
Mr. Cohen. Yes ; it is so, Mr. Halley.
Mr. Halley. Your own books describe your boolnnakers as your
agents. It appears all over the books. We have taken transcripts of
them.
Mr. Cohen. Yes. You can call them agents, you can call them con-
cessionaires. It is just a name that you apply to them. But the prin-
ciple of the business. Mr. Halley, was that they financed them. Their
gambling operations were financed by the S. & G.
Mr. Halley. Isn't it a fact that what you are doing — I don't want
to destroy any legal theory you may be trying to build for some prose-
cution you may have in mind, but isn't it a fact that you are just creat-
ing a set of legal conclusions that you hope to sustain ?
Mr. Cohen. That, I think, is very correct.
Mr. Halley. Wlien you get down to the fact, they shared the profits ?
Mr. Cohen. Yes.
510 ORGANIZED CRIMEl IN INTERSTATE OOMME'RCE
Mr. Halley, They sliared in the expense or a lot of expense?
Mr. Cohen. Ultimately it wound up that they shared.
Mr. Halley. They even shared the fines that were paid ?
Mr. Cohen. The fines did reflect in the net A's of the S. & G.
Mr. Halley. Ultimately, S. & G. shared in the fine?
Mr. Cohen. Ultimately it was a deduction against it.
Mr. Halley. That is right. They took the large bets as lay-off bets
and handled them themselves ?
Mr. Cohen. Yes; that is correct.
Mr. Halley. Of course, as Senator Kefauver points out, large lay-
off bets were kept by S. & G.
Mr. Cohen. That is right.
Mr. Halley. They arranged for the wire service ?
Mr. Cohen. That is correct.
Mr. Halley. And provided wire service ?
Mr. Cohen. That is correct.
Mr. Halley. They arranged for counsel to represent these people
if they were arrested ?
Mr. Cohen. Yes. My bill was always sent to the S. & G., not to the
individuals.
Mr. Halley. That is right. So Avhen you concluded it was just a
financing operation, that is a conclusion you would like to sustain in
some litigation you have in mind. Let's "just leave it there.
Mr. Cohen. That is very true, Mr. Halley.
Mr. Halley. Fine.
Senator Wiley. These other five that you have mentioned, have
they operated, as far as you know, on the same plan? That is the
usual way they operate throughout the country, is it?
Mr. Cohen. I wouldn't know about the country. I would know
about Miami Beach. I think that is the same way they do there
Senator.
Mr. Halley. Isn't it also a fact — I am sorry, had you finished.
Senator Wiley ?
Senator Wiley. For the time being; yes.
Mr. Halley. Isn't it also a fact that S. & G. had a tremendous num-i
ber of employees who serviced these various bookmakers in various
ways
Mr. Cohen. Oh, yes.
Mr. Halley. The payroll was about a quarter of a million dollars
a year, isn't that right?
]\rr. Cohen. I don't know the amount. The books would reflect it.
It was quite a few.
]\Ir. Halley. Isn't it also a fact — I think we mentioned a little
while ago — tliat Mr. liosenbaum sat in a penthouse office at the
Cromwell Hotel, where he would, through telephonic communica'
lion with other bookies throughout the country, try to check on
whether somebody was trying to cheat by betting on a hot horse or a
horse that they feared was fixed in some way ?
Mr. Cohen. I wouldn't know that. I know Mr. Edward Rosen-
baum was at the office at the Mercantile Bank Building.
;Mr. Halley. You knew there was an office at the top of the Crom-
well, didn't you?
Mr. Cohen. No ; I didn't know that.
ORGANIZED crime: in INTERBTATE COMMERCE 511
Mr. Hallet. You never heard of that?
Mr. CoHEX. I don't think I have heard of it. I have heard of a
number of them. I have read them in the paper. The offices were
supposed to be secret, but you could pick up the newspaper and find
out where they were.
Mr. Halij^y. One other point you were talking about with Senator
iWiley was competition on the beach. Looking through this list of
hotels, you have mentioned there were something like 350 hotels on
the beach.
Mr. Cohen. That is what I am informed.
Mr, Halley. Of course, they didn't all have bookies?
Mr. Cohen. There were very few that didn't, Mr. Halley.
Mr. Halley. The little fellows didn't, a great many of the little
ones didn't have a bookie. You know that.
Mr. Cohen. I wouldn't say that. I would say that most of them
did have.
Mr. Halley. Certainly they didn't all have bookies.
Mr. Cohen. No, not every hotel. I wouldn't go so far as to say that
every hotel did, Mr. Halley.
Mr. Halley, Doubtless most of the hotels did.
Mr. Cohen. Yes, sir.
Mr. Halley. I think that Allenberg testified that the Eobert Eichter
didn't have a bookie, at least in the last 2 or 3 years.
Mr. Cohen. They did have prior to that.
Mr. Halley. Prior to that, but not in the last 2 or 3 years. I think
that is a rather large ocean-front hotel, isn't it?
Mr. Cohen. It is a nice hotel.
Mr. Halley. Of those that had bookies, the S. & G. had almost 200
of them tied up, is that correct ?
Mr. Cohen. T\\ej gradually diminished, because — I think you have
it at the peak season, the most that they had, I think if you will
check back in later years, you will find that they dropped off and
dropped off. They voluntarily dropped off because they were not
profitable,
Mr, Halley, You had a lot of trouble in 1949 as a result of this cut-
off of the wire service and other things ?
Mr, Cohen, They weren't profitable,
Mr, Halley, Trouble made them unprofitable, didn't it ?
Mr, Cohen, No. Mr. Halley, during the years 1946, 1947, and 1948,
money was in more abundance and people bet more money. It has
itiglitened u]) quite a bit, and a lot of those places weren't profitable,
and they did just voluntarily refuse to service a number of them.
Mr. Halley. Looking at these places, though, with the exception
of the Roney Plaza Hotel, which Frank Erickson had for a while but
then went back to S. & G. what other really large or important hotel
on Miami Beach was handled by your competition? I have been
going through this. It seems to me that all the well-known, large
hotels are on this list.
Mr. Cohen. I can think offhand of two big ones. The MacFadden-
Deauville, which is considered a very nice hotel.
jMr. Halley. That is not exactly on the beach. That is up in what
:liey call Surfside.
Mr. Cohen. It is on thd beach. That is right in the heart of Miami
Beach.
512 ORGANIZED CRIME! IX rNTERSTATE OOIVEVIERCE
]Mr. Hallet. Isn't that called Surf side up there ?
Mr. Cohen. Not the Macf adden-Deauville. That is at Sixty-second
Street. The beach runs all the way up to Eighty-eighth.
Mr. Halley. Who has that hotel ?
Mr. Cohen. I wouldn't know.
]Mr. Halley. Do they have a book there ?
Mr. Cohen. I would presume that they do have.
Mr. Halley. What other hotel can you think of ?
Mr. Cohen. The Sherry-Frontenac.
Mr. Halij^y. Do they have a book there ?
Mr. Cohen. I would presume so.
Mr. Halley. Are there any other large, well-known hotels that
have
Mr. Cohen. You are putting me in a position that I don't like to
be in.
Mr. Halley. I know, but we are trying to establish the size of that
control that S. & G. had.
Mr. Cohen. Let's say I just can't recollect. It is veiT distasteful to
me to be in this position that you are putting me in, Mr. Halley.
Mr. Halley. We understand that, but the committee must get the
facts and must see the operation. You understand that.
Mr. Cohen. I am not acquainted with all of the spots that the
S. & G. had. I am not acquainted with them.
Mr. Halley. You have gone over tlie list. The}' certainly include
practically all of the big
Mr. Halley. Would you like to ?
Mr. Cohen. No; I would rather not see it. I would much rather
not see it.
Mr. Halley. Going ahead, then, to this wire service ; S. & G. got its
wire service from the Dade County News ; is that right ?
Mr. Cohen. I would presume if the check shows that, that is where
they got it.
Mr. Halley. They also dealt with a man named O'Brien; is that
right?
Mr. Cohen. I knew of Burns. I don't know of O'Brien.
Mr. Halley. Where was Burns? Wliat was his company?
Mr. Cohen. I am afraid you are going to have to ask one of the boys
on this stuff. I am not acquainted with that. I started to go down to
see Mr. Eobinson while he was there to get that information for him.
Mr. Halley. It was Intrastate News Service, wasn't it?
Mr. Cohen. That is right. It was not the Continental. A^Hiat they
did was have some other company lease it, and you had to buy it from
that other company.
Mr. Halley. It was run by O'Brien and Haggerty ?
Mr. Cohen. I don't know O'Brien, but I do know a Haggerty. I
have seen Haggerty.
Mr. Halley. He was connected with j'our wire service?
Mr. Cohen. Not our wire service — ^liis wire service.
I\Ir. Halley. The wire service you got, that you got from him; is
that right?
Mr. Cohen. Yes ; that is right.
]Mr. Halley. Tliat emanated from Continental News; is that right?
Mr. Cohen. I would believe that.
ORGANIZED CRIME IX INTERSTATE OOIVUVIERCE 513
Mr. Halley. Hom- were the charges made on the wire service ?
Mr. Cohen. You mean how do they estimate what they charge you?
Mr. Hali.ey. Yes.
Mr. Cohex. I couldn't answer that unless it might be on the fact of
the number of places you have, they charge you for that amount.
Mr. Halley. They provided the service?
Mr. Cohex. They provided the service ; yes, sir.
Mr. Halley. You also did a great deal of business with the telephone
company ; isn't that right ?
Mr. Cohex. Yes, sir.
Mr. Halley. Who paid the telephone charges on the wires going to
various bookmakers ?
Mr. Cohex. Mr. Levitt will know more about that.
IMr. Halley. We have a check that would indicate that S. & G. paid
them ; is that correct ?
Mr. Cohex. If the checks indicate that, they may have been paid by
S. & G. and charged to the other places; I wouldn't know, but Mr.
Levitt, who is in charge of the books, is here, and he could tell more
about it than I could.
Mr. Halley. 1 have been curious if you have had conversations with
the telephone company about the relationship because the back of the
checks that we have seen indicate that on each check you have listed
a great many telephone numbers. The telephone company must have
realized there was something peculiar in the relationship.
Mr. Cohex. Mr. Halley, I don't know anything about it. In fact,
when I tried to get my telephone, they put me on a four-party line,
and I had an awful time getting off it,
Mr. Halley, That is you personally, but let's stay with S. & G.
S. & G. operated during a period when telephones were fairly hard
to get, as you have just indicated.
Mr. Cohex. Yes ; that is true. I have no knowledge of the phone
business.
Mr. Halley. The syndicate bookmakers got their phone service
and they were able to operate, and got telephone service, is that right?
Mr. Cohex. They were able to operate ; yes, sir.
Mr. Halley. It ran well over $1,000 a month for telephone service
alone.
Mr. Cohex. Wliatever your books reflect, that is what it was.
Mr. Halley. Were there discusisons with anybody in the telephone
company about these bills that S. & G. was paying, covering, I would
say, on one check I have here, check No. 1665, "Pay to the order of
Southern Bell Tel. & Tel. Co. $1,680," signed by Sam Friedman and
Leo Levitt, dated November 22, 1948, estimating roughly, there are
50 telephone numbers listed on it. That would appear to me suffi-
ciently out of the ordinary course of business so that it would require
some discussion with the telephone company. Would it not appear
that way to you ?
Mr. Cohex. It would appear that way to me, too, Mr. Halley; yes,
sir.
Mr. Halley. But you know of no such discussions ?
Mr. Cohex. I know of no such discussion.
Mr. Halley. Then the day came when the five partners in S. & G.
took in a sixth partner, is that right ?
514 OEGANIZE'D CRIME IN XJSTTERSTATE OOMME'RCE
Mr. Cohen. That is correct, sir.
Mr.'HALLEY. And his name is Harry Russell?
Mr. Cohen. That is correct, sir.
Mr. H ALLEY. Would you tell the committee just what happened ?
Start at the beginning and give the committee the whole story.
Mr. Cohen. As I get it from the conversation with the boys, mean-
ing the five members of the S. & G., Mr. Russell, who is from Chicago,
had contacted quite a few of the owners of hotels on Miami Beach for
the following year, approximately 20 of the better hotels — by "better"
I mean those which were on the ocean front and had a large clientele —
he was attempting to get those and start to operate by himself. He
was going to service them himself. The members of the S. & G. had a
meeting, and they decided that rather than have serious competition
such as that, and due to the fact that they were also then thinking
about going into the baseball business — they had never been in any-
thing but the horses — they invited Mr. Russell to join them. He put
up his money as the sixth partner.
Mr. Halley. When did Russell contact these twenty-odd hotels, in
the summer prior to 1949 ?
Mr. Cohen. No. He was getting ready to have them — you usually
do business with the hotels as the season closes.
Mr. Halley. When did he do this business with the hotels ?
Mr. Cohen. He was doing that during the months of January and
February.
Mr. Halley. Of 1949?
Mr. Cohen. Of 1949; yes.
Mr. Halley. He entered S. & G. in 1949 ?
Mr. Cohen. Yes; he did. They got hold of him, and he entered
S. & G. on March 14. He gave them his check on the — I looked this up
in order that I would be exact — March 31.
Mr. Halley. He made a payment for his entrance into S. & G.. is
that right?
Mr. Cohen. Yes. His monej^ was to be used not for anything but
working capital. He did not purchase an interest in any of the fixtures
and things that they had.
Mr. Halley. How much did he pay ?
Mr. Cohen. $20,000.
Mr. Halley. Who arrived at that sum ? Did you have any discus-
sions with him ?
Mr. Cohen. No ; I did not.
Mr. Halley, You say that during the months of January and Feb-
ruary he was contacting the Miami Beach hotels, is that right?
Mr. Cohen. That is correct.
Mr. Halley. Had he done it prior to that time ?
Mr. Cohen. I don't know. It may have been in that neighborhood.
Mr. Halley. Did you seek Russell out, or did he seek S. & G. out?
Mr. Cohen. The S. & G. souglit Russell out.
Mr. Halley. He never approached them ?
Mr. Cohen. He did not approach them. They approached him.
Mr. Halley. There have been some strange circumstances surround-
ing it that don't quite jibe with your story. I would like to ask you
a lew questions about them.
Mr. Cohen. Go ahead, Mr. Halley.
ORGANIZED CRIME' IN rNTTERSTATE OOMIMERCE 515
Mr. Halusy. Starting at the tail end, it appeared strange to me tliat
if the story is that simple, Kussell should be so loath to appear here
before the committee and testify. He seems to be in great fear of
reprisals of some type if he appears before this committee. He is
apparently avoiding its service. Can you think of any reason why a
man should fear to come before the committee and tell a simple story
like that?
Mr. Cohen. Mr. Halley, I have had not more than one or two casual
discussions with Mr. Russell in my life.
Mr. Halley. You don't know him well ?
Mr. Cohen. No, I don't. I had never seen him prior to that.
Mr. Halley. You testified that there are other competing syndicates
on Miami Beach ; is that right ?
Mr. Cohen. That is correct, sir.
]Mr. Halley. Do you know whether the other S. & G. members were
friendly to Russell or particularl}^ associated with him ?
Mr. Cohen. In what manner, associated with him?
Mr. Halley. Socially ? Were they friends of his in any particular
way?
Mr. Cohen. I understand that Jules Levitt knew him.
Mr. Halley. Did he recommend him as the type of man you wanted
inS.&G.?
Mr. Cohen. I would like to answer that this way : These boys have
never wanted partners because they always prided themselves as being
a home-town group. Russell had been a resident there for a number of
years, not a permanent resident. He owned a home there, I under-
stand. The boys never knew of the facts that the newspapers later
brought out, that Russell was supposed to have some kind of mob
connections.
Mr. Halley. They knew he came from Chicago? Everybody
knew it.
Mr. Cohen, Does that mean that everyone from Chicago is a
mobster ?
Mr. Halley. We will get to that. They at least knew he came
from Chicago?
Mr. Cohen. They knew he came from Chicago, yes, sir. They
absolutely didn't know anything about any mob connections, and
to this day don't believe he is connected. From what they tell me,
his actions have not indicated anything like that.
Mr. Halley. Before we get into specific details about which I
would like to ask you a few questions, isn't it a fact — you have men-
tioned here that all kinds of competition on Miami Beach, other
syndicates, according to you, operate, and other bookmakers operate ;
and yet Russell, simply because, during the middle of a season when
you were ©iterating in perfectly fine fashion, simply because he saw
a few hotel owners with a view toward doing something in the follow-
ing season, you then and there, in the middle of the 1949 season, invited
him into this heretofore closed syndicate. Doesn't that strike you
as being a little peculiar?
Mr. Cohen. It isn't just as easy as you say, Mr. Halley.
Mr. Halley. I am sure it isn't.
Mr, Cohen, He had — and it looked like he would get — some of the
best hotels on Miami Beach that are owned by Chicago people. The
Kenilworth, which was not in Miami Beach, l3ut which was serviced
516 OiRGANIZED CRIME! IN INTERSTATE COMMERCE
by the S. & G., the Seaview, which was not in Miami Beach but was
serviced by the S, & G., were Chicago-owned and presumably friends
of Russell's. The Shellburn was Chicago-owned and presumably a
friend of Russell's. The Sorrento was Chicago-owned and presum-
ably a friend of Russell's. Russell had entree to the lucrative places
on Miami Beach.
Mr. Halley. In other words, Russell had sought entree to the
people from Chicago?
Mr. CoiiEN. That is right, and it seemed that they owned quite a
number of places on Miami Beach that were of the better type.
The Chairman. If any of the press photographers want to take
any pictures, they can do so.
Mr. Halley. Then at least Russell wasn't just a local boy, but he
was a fellow who had peculiar influence over the hotel owners who
came from Chicago; is that correct?
Mr. Cohen. That is correct, sir.
Mr. Halley. Then it happened that on February 20, 1949, the wire
service was shut off ; is that correct ?
Mr. Cohen. That is correct.
Mr. Halley. The wire service you have just testified you purchased
from O'Brien and Haggerty and the Dade County News, and that
they in turn got it from Continental ; is that right?
Mr. Cohen. I would presume that is correct.
Mr. Halley. Did you presume that Russell, with his Chicago con-
nections, had some way of influencing the news service, too?
Mr. Cohen. No.
Mr. Halley. Have you ever investigated to find out why the wire
service was suddenly cut off in the middle of a season, right at the
height of the season ?
Mr. Cohen. I did not investigate that, no.
Mr. Halley. The fact is, though, that it was resumed on March 4,
and 10 days later Russell was a member of the S. & G. Syndicate?
Mr. Cohen. That is correct.
Mr. Halley. There is no doubt in your mind about that?
Mr. Cohen. No ; there is no doubt about that.
Mr. Halley. Certain other things happened about that time. A
man named Crosby appeared on the beach and did some investigating ;
is that correct ?
Mr. Cohen. That is correct, sir.
Mr. Halley. I have just seen a statement from the Governor, say-
ing that Crosby had attempted to make some arrests and he had no
power to make arrests, but was simply to report violations to the
sheriff ; is that right ?
Mr. Cohen. I wouldn't doubt the Governor. If he said that was
liis authority, I would presume it is correct.
Mr. Halley. So the fact is that Crosby moved about on the beach
and tried to spot bookmaking establisliments and have them raided;
is that correct ?
Mr. Cohen. From the testimony that I heard, he would spot the
places and bring the deputy sheriff there, because he didn't have the
authority to make an arrest.
Mr. Halley. That is right. The places he spotted were your
;S. & G. bookmakers, weren't they ?
ORGAXIZED crime: IN INTERSTATE COMMERCE 517
Mr. Cohen. Yes, they were. Thev were people who dealt with the
S. iS: G.
Mr. Halley. This was what we have previously referred to as
heat, wasn't it ?
Mr. Cohen. It is heat, all right.
Mr, Halley. It is not very good when, in the middle of a season,
your bookmakers are being raided and pulled in before the police
and fined ?
Mr. Cohen. It is not conducive to good business.
Mr. Halley. That also was happening just prior to the time that
you took this fellow Russell into your business ; isn't that right ?
Mr. Cohen. Yes; it is about the time that they took Russell into
the business.
Mr. Halley. Did you hear the testimony of this investigator that
the governor sent down, Crosby, that Russell was tipping him off as
to the location of these places ?
Mr. Cohen. No. That was the evening you allowed me to go
home. I didn't hear his testimony.
Mr. Hali^ey. I shouldn't have been soft-hearted, Mr. Cohen.
Crosby did so testify.
Mr. Cohen. Yes ; I read that in the paper.
Mr. Halley. So we have the further strange coincidence that this
investigator ajDpeared, and he was tipped off by Russell as to the
particular S. & G. locations where he might make an arrest; is that
correct ?
Mr. Cohen. That is correct ; yes. I don't believe it, though.
Mr. Halley. You don't believe it ?
Mr. Cohen. Xo. I don't think Russell did that.
Mr. Halley. Mr. Crosby so testified under oath, didn't he?
Mr. Cohen. We have a right to believe what we care to believe.
I just can't believe that Russell would do that.
Mr. Halley. You mean you don't care to believe it?
Mr. Cohen. I can't believe that a man in that business would do
that.
Mr. Halley. He was trying to cut into your hotel group up there.
Mr. Cohen. Xo ; I didn't say that. He was trying to go in business
by himself.
Mr. Halley. He was trying to take hotels away from you, locations
away from you.
Mr. Cohen. He was trying to take away locations that had been
dealing with the syndicate, that is true, but to resort to something
like Crosby
Mr. Halley. It would be pretty mean ?
Mr. Cohen. Yes ; it would be pretty low.
Mr. Halley. It would hurt where it might affect your business ?
Mr. Cohen. Yes ; that is true, Mr. Halley.
Mr. Halley. You have said that you didn't know anything about
Russell's Chicago connections; is that right?
Mr. Cohen. Definitely right, sir.
Mr. Halley. Have you ever heard of Tony Accardo ?
Mr. Cohen. Never in my life.
Mr. Halley. Are you quite sure of that ?
Mr. Cohen. I am positive of that.
518 ORGANIZED CRIMEi IN INTERSTATE OOIVCMERCE
Mr. Hallet. Isn't it a fact that the S. & G. Syndicate, during the
fall of 1948, purchased a boat ?
Mr. Cohen. If they did, I didn't Imow anything about it. I know
they have a boat.
Mr. Halley. ~V\'liat is the name of the boat ?
Mr. Cohen. I have never been on it. I have never seen it.
Mr. Hallet. Isn't it a fact that that boat is called the Flamingo f
Mr. Cohen. Yes ; I think you are right.
Mr. Halley. Previously it was called Blary Jo.
Senator Wiley. What kind of boat is it?
Mr. Cohen. From what they tell me, it is a pretty nice one, Senator.
It is a Chris-Craft, 40 feet long, and a real nice boat. In fact, they
have it up for sale, now. It is one of the assets of the S. & G. that
they are trying to dispose of.
Mr. Halley. Isn't it a fact that the S. & G. bought that boat from
Tony Accardo?
Mr. Cohen. Mr. Halley, I knew nothing about the boat, when they
bought it. They didn't come to me to close any deal on it. I have
no recollection of ever having anything to do with the boat.
Mr. Halley. I show you photostatic copies of two checks, No. 2700
and 2701, dated, respectively, February 2, 1950, and Febi'uary 9, 1950,
and I ask you if these aren't checks of the S. & G. Syndicate payable
to Tony Accardo?
Mr. Cohen. Yes; they are, and they are signed by the same people
who pay me.
The Chairman. $5,000 each.
Mr. Cohen. That is correct, sir.
Mr. Halley. Isn't it a fact that the total purchase price of this boat
was $20,000?
Mr. Cohen. I don't know, sir. The records would reflect that.
Mr. Halley. If the records so show ?
Mr. Cohen. I would say that is correct.
Mr. Halley. Haven't you ever been told that Harry Russell was
an associate of Tony Accardo's in Chicago ?
Mr. Cohen. Never in my life. In the first place, the name Tony
Accardo wouldn't mean anything to me, because I don"t know of him,
I never heard of him, and I still don't know who Tony Accardo is.
Mr. Halley. You have heard that he is a well-known Chicago
gangster, haven't you, with a long police record, gambler and member
of the Capone syndicate?
Mr. Cohen. Mr. Halley, you may think this odd, but I never read
the papers about any murders. I don't care to read about those things.
I never read about gambling things, because I know^ sometimes they
are colored a lot. I can definitely swear, Avithout fear of any reper-
cussions, that I have never heard of Tony Accardo or Arcardo, what-
ever it is, until this present time.
Mr. Halley. This fellow^ Russell gets into the S. & G. Svndicate in
March of 1949?
Mr. Cohen. That is correct.
Mr. Halley. And a few months later, 6 months, in October of 1949,
S. & G. bu3^s a boat from Tony Accardo, whom you, at least, had never
previously heard of, is that right?
Mr. Cohen. That is correct.
ORGANIZED CRIAfE' IN INTERSTATE CX)MMERCE 519
Mr. Halley. You are quite familiar with the affairs of S. & G. ; you
have been pretty close to its members for several years, haven't you ?
Mr. Cohen. The}^ are all dear friends of mine that I have known for
25 years.
Mr. Halley. If Tony Accardo was one of their group, you would
have known about it in all probability, wouldn't you 'i
Mr. Cohen. The S. & G. ?
Mr. Halley. Yes.
Mr. Cohen. Certainly I woidd have known about it.
Mr. Halley. If they used his name and referred to him as a friend,
you would have heard of him ?
Mr. Cohen. That is right, that is right.
Mr. Halley. Isn't it a fair presumption, then, that any relationships
between the S. & G. and Tony Accardo resulting in the purchase of this
yacht would be a result of Russell's association with the S. & G. ?
Mr. Cohen. I would say that they probably wanted to buy a boat.
They had a boat prior to that, a smaller one, but that boat was prob-
ably available and they purchased it.
Mr. Halley, It is a pretty nice boat, I understand; is that correct?
Mr. Cohen. So I have been told. I have never been on it. On the
plane coming up, I was with Mr. Eosenbaum, and he happened to
meet a man, we happened to meet a man, who had just purchased a
place in Nassau. Rosenbaum built this boat up very, very highly, be-
cause he was trying to sell it to the man. I imagine it is a nice boat.
He explained that it had a ship-to-shore telephone on it, that it was
40 feet, had four staterooms in it, and just every modern convenience
there was to a boat. It was a Chris-Craft and could do, I think he
said, 30 miles an hour, or something like that.
Mr. Halley. The boat certainly seems to be a real boat, and prob-
ably a nice one. Yet there is the strange coincidence that the price
for the boat is exactly the price that Harry Russell paid S. & G. Syn-
dicate for his membershi]3. I have been wondering if you could throw
any light on that coincidence.
Mr. Cohen. I don't think that can be reconciled with each other.
I Imow that can't be.
Mr. Halley. You wouldn't think there is any relationship ?
Mr. Cohen. Definitely not.
Mr. Halley. Going ahead on the circumstances surrounding Rus-
sell's coming into the S. & G., this wire service went off quite suddenly
on February 20, isn't that right?
Mr. Cohen. I presume so.
Mr. Halley. Then you continued to operate for some time after
the wire service went off, by getting the racing news bootlegged from
another area, didn't you ?
Mr. Cohen. I think they did.
Mr. Halley. Friends of the S. & G. in another area provided tele-
phone service to S. & G. ; isn't that correct ?
Mr. Cohen. I think that is correct, Mr. Halley.
Mr. Halley. Then one day. over the wire, there came a statement
saying that whoever was providing the information to S. & G. would
have to stop it within half an hour, or the wire service for the entire
southern part of Florida would be shut off. Isn't that right?
Mr. Cohen. I couldn't say that that is right. I don't know. It
may be, but I don't know.
68958— 50— pt. 1 34
520 OfRGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Halley. In any event, the wive service was shut off?
Mr. Cohen. Shut off from the entire State.
Mr. Halley. And then you couldn't get it at all, for a period ?
Mr. Cohen. Not from them. They got it.
Mr. Halley. You didn't get it. Your books show no in's.
Mr. Cohen. They probably didn't do business, but they did make
arrangements to get additional service.
Mr. Halley. Apparently it was so unsatisfactory that they just
did no business.
Mr. Cohen. That is right.
Mr. Halley. Would you agree to that?
Mr. Cohen. Yes.
Mr. Halley. Then you had to renegotiate with this wire service;
isn't that right?
Mr. Cohen. I don't know whether they renegotiated or not. The
records would probably show what the price was and
Mr. Halley. In addition to all of that, isn't it a fact that you had
certain discussions with a Mr. Rush, an attorney in Jacksonville? He
was retained, wasn't he, by the S. & G. Syndicate ?
Mr. Cohen. He was retained by me, for attempting to get legalized
gambling into Florida.
Mr. Halley. How^ did you get interested in this legalized gambling
matter ?
Mr. Cohen. I personally have never been for legalized gambling.
Let me explain. I felt that if a legalized gambling bill were drawn
up in which Miami Beach boys would be taken care of for Miami
Beach it would be so much better for them to be 1,000 percent within
the law than without the law ; that it would give them a franchise
the same as the race tracks had ; it would increase the take to the State ;
it would bring in, as the figures will show, a great amount of addi-
tional revenue to the State of Florida. I can't say that my ideas on
the legalized gambling were strictly one of good citizenship. I can't
say that thej were strictly that. Because I did want to see these boys
in that business, too. My interest was somewhat divided, but I thought
that the State would be served properly and they would be well served
if they could get the right to conduct that business, especially on
Miami Beach.
Mr. Halley. That represented a change of mind on your part, didn't
it?
Mr. Cohen. No.
Mr. Halley. You said originally you had been opposed to legalized
gambling.
Mr. Cohen. In my mind, I still feel it is bad.
Mr. Halley. Nonetheless, you went over onto the side of legalized
gambling sufficiently strongly to retain Rush ?
Mr. Cohen. At their instance.
Mr. Halley. At whose instance ?
Mr. Cohen The instance of the S. & G.
Mr. Halley. In 1949 ?
Mr. Cohen. That is correct, sir.
Mr. Halley. In the spring of 1949 ?
Mr. Cohen. That is correct.
Mr. Halley. Wasn't there some connection between your change of
heart and your ability to get this bootleg wire service ?
ORGANIZED CRIME' IN INTERSTATE CX)MME'RCE 521
Mr. Cohen. I don't understand that question.
Mr. Halley. Didn't you call somebody in for help in your struggle
to maintain your wire service and keep the S. & G. from going out of
business? Didn't you at that time make a deal whereby, in return
for help in the fight to keep the wire service, you would support some-
body else in an effort to get legalized gambling ?
Mr. Cohen. No. There was no one to suf)port. There were no
elections coming up.
Mr. Halley. Wasn't there a man named Raymond Craig, who was a
very well-known bookie in Miami?
Mr Cohen. Yes. I know Raymond Craig.
Mr. Halley. He pretty well controls bookmaking across the bay
in Miami, doesn't he?
Mr. Cohen. I wouldn't say that he controls it, but he is in that
business there in a substantial way.
Mr. Halley. Didn't you have discussions with Craig about this
legalized gambling bill ?
Mr. Cohen. Oh, yes ; many of them.
Mr. Halley. Didn't he induce you to support his legalized aram-
bling?? / ^ ^ ^
Mr. Cohen. No. I met Craig in this particular venture after I had
been to see Mr. Rush.
Mr. Halley. Are you sure of that ?
Mr Cohen. I am positive of it, because I had not discussed — after
I had gotten a draft of the bill from Rush and didn't like it and sent it
back to him with corrections
Mr. Halley. When did you first hire Rush ?
Mr. Cohen. Two days prior to the date the check was given.
Mr. Halley. Wasn't that check March 25, 1949?
Mr. Cohen. That is correct.
Mr. Halley. Then you hired him March 23, 1949?
Mr. Cohen. That is correct.
Mr. Halley. You paid him at that time $10,000, is that right?
Mr. Cohen. That is cori-ect.
Mr. Halley. A check drawn by the S. & G. ?
Mr. Cohen. That is correct, sir.
Mr. Halley. He has testified that you were to pay him an addi-
tional $10,000 if the bill went through.
Mr. Cohen. That is correct.
Mr. Halley. He testified he was to do nothing but draft the bill.
Mr. Cohen. We expected more of him.
Mr. Halley. What do you mean ?
Mr. Cohen. I knew that Rush was quite interested in the governor's
campaign, that he had done some legislative work for the race tracks,
and I felt that if we had him on our side it would help. The addi-
tional $10,000 was more of a bonus in getting him really to do some
work.
Mr. Halley. You certainly feel that merely drafting a bill would
not be worth $10,000 or $20,000?
Mr. Cohen. To tell you the truth, no. I could have drafted it just
as well.
Mr. Halley. In about 10 minutes ?
Mr. Cohen. No, I wouldn't say 10 minutes. Let's say I am not that
good an attorney. It would take me an hour or 2.
522 ORGHANIZED CRIME' IN rNTTER STATE COMMERCE
Mr. Halley. So when you paid Rush $10,000, and agreed to pay him
$10,000 in addition to that if successful, at least in your mind was the-
thought that he would do a lot more than draft the bill ?
Mr. CoHEN". That was the inducement for the other $10,000. You
don't go to a man and insult him right to his face, but you put it to
him in a pleasant way and expect some help, and hope that the induce-
ment will be large enough that he will exert himself. I imagine the
additional $10,000 would have meant quite a bit to Mr. Rush, as it
would to anyone.
Mr. Halley. Maybe it will refresh your recollection. You paid
Rush, March 23, 1949?
Mr. CoHEN^. That is right.
Mr. Halley. Your wire service was cut off the latter part of
February 1949?
Mr. Cohen. That is correct.
Mr. Halley. Isn't it Craig who gave you the bootleg wire informa-
tion for Miami?
Mr. Cohen. I would have no knowledge, but I don't think there
ever has been any too much friendship between Craig and the S. & G.
Mr. Halley. I know, but wasn't there a deal made that you would
help Craig by financing this
Mr. Cohen. No.
Mr. Halley, This pet bill of his ; and it was his pet bill, wasn't it ?
Even Rush so testified.
Mr, Cohen. That didn't make it his pet bill. The S. & G. was just
as anxious to get that passed as Mr. Craig was. We made — my discus-
sion with Craig was that if it were passed, I wanted to make sure he
wouldn't come over to Miami Beach. He was positive that the S. & G.
boys wouldn't go over to Miami, but I wasn't so positive that he
wouldn't come over to Miami Beach.
Mr. Halley. Where did you get your bootleg wire information after
the wire service shut down ?
Mr. Cohen. I wouldn't know that. I don't know what the situation
was.
Mr. Halley. Can you find out now ? Ask whoever would know it.
Mr. Cohen. Will you excuse me ?
(The witness left the stand to confer, and returned.)
Mr. Halley. Do you have that answer ?
Mr. Cohen. Yes, I have sir. They sent a boy to New Orleans, and
he got the service and telephoned it in to them.
Mr. Halley. You didn't get any from Miami ?
Mr. Cohen. Not from what they tell me.
Mr. Halley. Why weren't you able to continue, then, after the wire
service for Florida was cut off ? If it worked that way, you would be
able to keep right on getting it from New Orleans. It doesn't make
sense, that is all.
Mr. Cohen. Yes, it does.
Mr, Halley. You were getting bootleg wire service from New Or-
leans, you say ?
Mr. Cohen. That is what I have been informed.
Mr. Halley. Then comes the day when they shut off the wire service
for the whole State of Florida, and S. & G. would have been in fine
shape. You would have kept right on getting it from New Orleans.
ORGANIZED CRIME' IN INTERSTATE OOAOIE'RCE 523
Mr. Cohen. I would suggest — I have to go ask them. I would sug-
gest that when Mr. Levitt comes up
Mr. Halley. I think we had better hold that question, because we
are not getting anywhere with this New^ Orleans idea at all. It just
can't be right.
I will ask you if it isn't the fact that you had a conversation with
Craig, and that Craig agreed to help you fight the Chicago interests
on this wire service, and that you agreed, in return, to help him on his
campaign to have legalized betting; that as a result, you were sent to
Rush; and if, as a result of that, you didn't pay Rush off with $10,000
and the promise of another $10,000?
yiv. Cohen. Definitely not. That is not correct.
IVIr. Halley. Rush is known to be counsel for William H. Johnston,
is he not ?
Mr. Cohen. That is right, sir.
Mr. Halley. And Johnston is the man who I believe is here to
testify for himself. He has been reported as having made a very
large contribution to the gubernatorial campaign, is that correct?
Mr. Cohen. That is correct.
Mr. Halley. In 1948?
Mr. Cohen. That is correct.
Mr. Halley. I believe you have heard testimony that this investi-
gator who was in Miami Beach, Crosby, w^as at least acquainted with
both Rush and Johnston. Is that right ?
JNIr. Cohen. I read that in the paper, yes, sir.
Mr. Halley. I believe — woukl it be true to say you have had no
previous business dealings with Rush ?
Mr. Cohen. That is correct.
Mr. Halley. Right after this entry of Russell into the S. & G. you
went up to Jacksonville and retained Rush ?
Mr. Cohen. No, not right after, Mr. Halley
Mr. Halley. Just about the same time ?
Mr. Cohen. No. According to that, it was 14 daj^s later, or 10 or
12 days later. Our legislature meets in April. They met in April of
that year. I went to see Mr. Rush approximately a week before the
session of the legislature.
Mr. Halley. You took a trip up to Jacksonville as early as the 14th
of March, right in the middle of the time that the wire service was off,
10 days later ?
Mr. Cohen. I don't think so.
Mr. Halley. We find a record of transportation for three people
from Miami to Jacksonville, March 14. Would that throw any light
on it?
Mr. Cohen. Service was on March 14, wasn't it, Mr. Bailey ?
Mr. Halley. Yes, it had been resumed.
Mr. Cohen, There was no connection between that legalized bill
and the service. There was no connection. This would have been
something — the idea of the bill was that 3 percent would go to the
agent. Whenever you can be in a business and get 3 percent of what
you handle — you know what the handle was that they reported.
Mr. Halley. $26,000,000 in 1948.
Mr. Cohen. All right, 3 percent in good, clean, legitimate business
where nobody can point a finger at you, that is a real nice income for
524 ORGANIZED CRIME: IN INTERSTATE COMMERCE
them if we could have gotten something like that passed. The State
would have enjoyed far greater benefits.
Mr. Halley. But you did nothing about it? You never took any
move toward getting legalized betting until March of 1949 ?
Mr. Cohen. Oh, yes. I took a trip up to Tallahassee and saw Rush
there.
Mr. Hallet. When ?
Mr. Cohen. During the session of the legislature.
Mr. Halley. Prior to March of 1949 ?
Mr. Cohen. They meet in April, Mr. Halley, and they meet every
2 years.
Mr. Halley. You retained him in March of 1949 ?
Mr. Cohen. That is correct.
Mr. Halley. That was your first interest in it ?
Mr. Cohen. You asked me if I did anything after that. Yes.
Mr. Halley. Prior to it.
Mr. Cohen. Prior to it, no.
Senator O'Conor. Was the bill introduced?
Mr. Cohen. Yes.
Senator O'Conor. Did it meet with any favor ? Did it proceed very
far?
Mr. Cohen. No; it didn't get too far in the house. There were
many proponents, and then I don't know what happened to it. They
just couldn't get it passed through the house, and they forgot about
it. It was tied up with the sales tax, and you couldn't get to any-
thing on the agenda. They just couldn't reach it. We were in bad
shape on taxes in Florida the last 3 weeks of the session, anyway.
Mr. Halley. Do the S. & G. members, or any of them, have an inter-
est in any other gambling establishments ? I refer to places like Sunny
Isles, Club Collins.
Mr. Cohen. No ; not Club Collins.
Mr, Halley. You would say no as to Club Collins ?
Mr. Cohen. Club Collins at one time was a concessionaire for the
S. & G. but they have no interest in the Club Collins. There are some
members who have an interest in the Sunny Isles. My brother has
an interest in the Island Club.
Mr. Halley. Sunny Isles and Island Club are gambling establish-
ments, is that right ?
Mr. Cohen. They have restaurants, and they do have gambling.
Mr. Halley. Craps and roulette, and things of that type?
Mr. Cohen. That is correct, sir.
Mr. Halley. In certain years they have been extremely lucrative^
with the net profit going up into the hundreds of thousands, is that
right?
Mr. Cohen. That I wouldn't know.
Mr. Halley. You do know they have been very lucrative from time
to time ?
Mr. Cohen. Mr. Halley, I wouldn't know anything about that. I
haven't been in the Sunny Isles Club, I would say, five times in my life.
Mr. Halley. You do have a participation in your brother's interest
in S. & G., don't you ?
Mr. Cohen. I would rather not discuss that, if you don't mind. I
am under income-tax investigation, and I would rather not discuss it.
I would lika to claim privilege on that particular question.
ORGANIZED CRIM'E' IX INTERSTATE COMMERCE 525
Mr. Halley. We won't go into that point now. The committee
record has ah-eady been made on that point, I believe.
Mr. Cohen. Yes ; I know it has.
Mr. Halley. With the committee's agreement, I won't press it.
The Chairman. I think Mr. Cohen shoukUi't discuss that matter.
Mr. Halley. How do you account for the fact that S. & G. has been
allowed to operate unmolested on Miami Beach ?
Mr. Cohen. Why do you say "unmolested'' ?
Mr. Halley. Because, with the exception of paying certain fines
which enabled the city government to collect revenue, S. & G. has been
able to keep its bookmakers in business.
Mr. Cohen. Mr. Halley, up until the time Frank Erickson went
to jail here, I don't think they ever had a conviction in New York on
bookmaking. So the record states.
Mr. Halley. Let's stick to the place we are working the facts up
on. We will get to New York in due time.
Mr. Cohen. What I mean is this : The concessions were arrested.
Mr. Halley. And they paid a fine and went right back into business.
Mr. Cohen. Yes ; that is right.
Mr. Halley. You have heard the testimony of Sheriff Burke that
on at least two occasions when he went to malie arrests with this man
Crosb7/, the-special investigator, you were there either simultaneously
with the investigators or immediately afterward.
Mr. Cohen. His testimony was not that I was there simultaneously,
as I remember it, and it could not have been. I received telephone
calls from Mr. Levitt on each occasion, I think it is Mr. Levitt on each
occasion, and whenever I went to the place at 1 : 50 where Mr. Crosby
was, and I found out that they had broken down the door in order
to get in there, I told them to go ahead, I didn't care if they arrested
them. It was going to make more money for me, because it was
thoroughly an illegal arrest. Wliere I am successful in getting men
off, I don't care how many they arrest.
Mr. Halley. Isn't it a fact that you managed always to be on the
scene of these arrests practically as soon as they occurred?
Mr. Cohen. Mr. Halley, how could I manage that ? I have a gen-
eral law practice.
Mr. Halley. The chief of police testified that on the one occasion
when he tried to organize a raid, you would beat him to the scene.
Mr. Cohen. I don't know where that could be.
Mr. Halley. Chief Short so testified.
Mr. Cohen. No ; I don't think so. I think one of us is wrong on
that.
The Chahiman. I think he said, when he got there, he found "The
Voice" already there.
Mr. Cohen. The what?
The Chairman. "The Voice," and you were "The Voice."
Mr. Halley. The mouthpiece. [Laughter.]
Mr. Cohen. I don't think you gentlemen got the right thing there.
He said he went to raid the Club Collins, and someone had tipped
them off. He didn't intimate that I tipped them off, but I did repre-
sent them in court the next day, and they were all dismissed. He said
that he thought someone had told them that he was going to be there,
and they were apparently sitting around tables doing nothing.
526 ORGIANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Halley. The indications appear to be that these arrests were
always on a very cozy basis ; that yon had a pretty good idea who was
going to be arrested and when, and when you appeared in court you
had a fairly good idea of what the opinion would be and what the
disposition would be.
Mr. Cohen, Oh, no ; that can't be.
Mr. Halley. Have any of your bookmakers ever had a substantial
jail sentence imposed when you represented them?
Mr. Cohen. Let's say that there has never been a good stiff jail
sentence imposed at any time, whether I represented them or whether
John Doaks represented them. They just didn't give them.
INIr. Halley. But you have never had a stiff sentence?
Mr. Cohen. No. There have never been any stiff sentences given.
Mr. Halley. At any time?
Mr. Cohen. Not that I know of.
Mr. Halley. Would you say nobody ever received a substantial jail
sentence in the last 5 years in Miami Beach ?
Mr. Cohen. No one has received a stiff jail sentence for gambling
in the last 5 years.
Mr. Halley. By "stiff," would you mean, say, 30 days or more ?
Mr. Cohen. Any jail sentence.
Mr. Halley. Any jail sentence. Have any of j^our people received
any jail sentence at all?
Mr. Cohen. No.
Senator O "Conor. May I ask a question right there. Was there any
inquiry made in connection with any of these prosecutions as to the
connection of the S. & G. in the furnishing of essential information
for the continuation of the bookmaking operation?
Mr. Cohen. There was never any.
Senator O'Conor. Apparently there was not very much secret about
the fact that the S. & G. was doing an extensive business in furnishing
the information; was there?
Mr. Cohen. That is correct, sir.
Senator O'Conor. The reason I say that: there are four checks I
have picked up here at random which totaled for 4 months' bills, each
for a inonth, and which in the aggregate are $5,000 or more; on the
back of the checks are listed all the telephone numbers, as Mr. Halley
has indicated. On one I happened to count 74 telephone numbers on
the back of the check. That certainly was notice to a great many
people in and out of the telephone company that the S. & G. had quite
an extensive operation.
Mr. Cohen. That is correct. It was common knowledge and in the
newspapers, Senator.
Senator O'Conor. That is right.
Did you ever discuss it at all as counsel for S. & G. with any of
the telephone company operators?
Mr. Cohen. No ; I never knew anyone down there, Senator.
Mr. Halley. You were personally acquainted with the chief of
police, of course ?
Mr. Cohen. I believe I have personally known every chief of police
who has been down there for the past 25 years.
Mr. Halley. And you were personally acquainted with the one-man
vice and gambling squad, Perdue?
OT^GANIZED CRIME' IN INTERSTATE OOMME'RCE 527
Mr. Cohen. Yes. sir.
Mr. Halley. In fact, you have a former law associate on the bench ;
do you not ?
Mr. Cohen. Yes. Tliere was a young man in my office who, when
he got out of school, came into my office, went off to war, and when he
came back he opened his own law office. I believe I was instrumental
in getting him put on the bench there.
Mr. Halley. How would you be instrumental ? What is the nature
of your influence there ?
Mr. Cohen. They are appointed by the city manager. I think this
is an appointment of the council, and I am acquainted with certain
members of the coiuicil, and I go to them and try to propound the
good qualities of the individual.
Mr. Halley. S. & G. had very good relations with the city council;
did it not?
Mr. Cohen. I had good relations with them.
Mr. Halley. In fact, you attempted at one point even to have the
city move part of its city-hall offices into an S. & G. building; isn't
that a fact
Mr. Cohen. No ; that is not a fact.
Mr. Halley. Richards so testified and said that he finally stopped it.
Mr. Cohen. Let me tell you, Richards testified to a lot of things that
I claim are per]\uy. Richards testified that he saw me at a restaurant,
the first time he had seen me there, and I sat down to a table and
started to expound the good qualities of the S. & G. boys, when he knew
that was a deliberate lie. The Miami Beach Bar Association used
to meet at this restaurant, known as Murphey's Restaurant, every 2
weeks. I was president of the Miami Beach Bar Association at that
time. I came in late, and someone else was conducting the meeting.
The vice president was conducting the meeting. I took the first chair
that was closest to me, so I wouldn't disturb the meeting. I sat down
beside Red Snedeker, who is now county commissioner. I have known
Richards for quite a while. In fact, I have notified Richards — this
is a long while past — ^that I no longer care to have a teleplione con-
versation with him; that I didn't trust him, and that if he wanted
to communicate with me in any way to write me a letter and I would
answer that letter. This happened after an election. My argument
with Richards was that he said to the public "I am not against gam-
bling," and later he said "I am for the enforcement of all laws." At the
table I said, "Mel, how can you reconcile the fact that you are not
against gambling but you were for the enforcement of all laws?
How can you reconcile the two?"
He said, "Well, I tell you, I am not against the race track. I am
not against the dog track."
That hit me by surprise ; how a man could tell you that.
I said, "You are dishonest in mind. If that is what you meant, why
didn't you tell the people that?"
Mel Richards didn't run on a campaign of being against gambling.
All he said was that he would eliminate the S. & G. He didn't say
anything about any other organization or any other group.
Mr. Halley. Is it possible in your own mind that S. & G., consider-
ing its business and the fact as you said that their operations are illegal,
may have welded just too much power for the goocl of the community ;
528 ORGiANIZED CRIME' IN liSTTERiSTATE COMMERCE
that you, with your ability, could persuade, as you have said, the
city manager that a former law associate of yours would be a good
judge; that you, as head of the bar association — I think there has been
testimony that Salvey and Burbridge, one of the city councilmen, have
had extensive business transactions
Mr. Cohen. Salvey never butted into any appointments.
Mr. Hallet. Wouldn't it be very possible that his point might be,
and I ask you whether you woulcln't think that people engaged in
admittedly illegal business, perhaps should not have that kind of
influence in the community ?
Mr. Cohen. Mr. Halley, maybe you are right, but you have brought
out a point that they had enough nerve to try to move the city hall to
a gambler's place of business. Mr. Salvey had an agent who was
renting his business, building. The third floor was for rent. The city
of Miami Beach needed space. The agents submitted that space to
the city of Miami Beach. Would that have been moving city hall, or
Avould it be an attempt to grab headlines and make speeches, like
Eichards did ?
Mr. Halley. Let's get back to the crux of the matter. You said
maybe I was right. Did you mean, by that, that maybe I am right in
saying that, in the light of the business that S. & G. conducted, it is
not a good thing for a community that the people who operate this
syndicate and their counsel, when their intent is in continuing this
kind of business, should wield the kind of influence — I am not saying
sinister influence; let's assume it is not sinister — that you have just
testified you had in the city of Miami Beach and in the community?
Mr. Cohen. I don't know what influence we had.
Mr. Halley. You said you had the ability to influence the appoint-
ment of a judge. You appear regularly before the courts defending
people whenever they are put in jail.
Mr. Cohen. Let me explain that, too. I made the statement in open
court that I would never try a case in front of this judge.
Mr. Halley. That is understandable.
Mr. Cohen. I did, and I had a big fight about it, and he wound up
trying to throw me in jail for contempt of court because I wouldn't try
a case in front of him.
Mr. Halley. He was friendly to you, though ; you were not really
antagonistic.
Mr. Cohen. We eat lunch together every day that I am in Miami
Beach and he is there.
Mr. Halley. In addition to that
Senator Hunt. That is a significant statement.
Mr. Cohen. Yes ; we do eat lunch together every day.
Mr. Halley. In addition to that, in the various real-estate transac-
tions that the members of the syndicate have had, they have actually
been represented by the same man who represents the city of Miami
Beach, the city attorney; isn't that correct?
Mr. Cohen. That is not correct.
Mr. Halley. Doesn't his name appear on the deeds?
Mr. Cohen. Did you notice whose name appeared on the deeds?
Mr. Halley. What is the difi'erence ? If 1 buy real estate and I have
the (leeds sent for recording to an attorney, I must be having some
relationship with him. Why do you send it to the city attorney?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 529
Mr. Cohen. At that time he represented him. Ben Shepherd, who
is the city attorney, happens to be a dear friend of mine also and has
been for the past 20 or 25 years. I remember Ben Shepherd before
he took the bar examination. When I had my offices in Miami, Ben
Shepherd was with me every day. Ben Shepherd was clerk of the
court in Dade County Circuit Court as far back as 1914, I believe.
He represented them in some real-estate transactions back in 1944
before he was city attorney, and I don't see anything improper about
him, because he doesn't prosecute them in any way ; the city attorney
doesn't. He represented them, I understand, prior to his ever being
<?ity attorney for the city of Miami Beach.
Mr. Halley. Some of these deeds went to him right at the city hall.
The address to which they were sent was his office in the city hall.
Mr. Cf)HEN. All right, then, those were some that he did while he
was city attorney ; but I see nothing wrong with him representing an
individual in purchasing land.
Mr. Halley. I am not going to ask you, sitting there as an attorney
to admit whether these things were wrong or right ; but would you not
agree that it is quite apparent, on the basis of long association, busi-
ness relationships, your professional relationships, the associations
and business relationships of the S. & G. Syndicate members, that you
were very well and favorably connected with the city council and the
city administration of Miami Beach and that you exercised a great
influence in the management of the city affairs?
Mr. Cohen. Definitely not.
INIr. Halley. How can you deny it ?
Mr. Cohen. We had nothing to do with the management of city
affairs.
Mr. Halley. Is that the part you would disagree with ? Would you
agree with the rest of the statement ?
INIr. Cohen. You have made a pretty long sentence.
Mr. Halley. I will break it down. Would you agree that you
certainly had long-standing friendships with important city officials?
Mr. Cohen. Yes ; I had some.
Mr. Halley. And that various S. & G. members did have ?
Mr. Cohen. I know of one S. & G. member, one individual.
Mr. Halley. Would you agree that you and the various S. & G.
members had at least certain business transactions with high-ranking
•city officials?
Mr. Cohen. I had no business transactions, but some of them had
some with the city attorney. He examined some abstracts and repre-
sented them in some purchases of real estate.
Mr. Halley. Would you agree that at least Harold Salvey had very
substantial business relations with one city councilman named
Burbridge ?
Mr. CoECEN. Yes, sir.
Mr. Halley. W^ould you agree that Burbridge is at least reputed
throughout Miami Beach to be a very persuasive and important mem-
ber of the council?
Mr. Cohen. Yes.
^Ir. Halley. Probably the decisive factor in the council ?
Mr. CoiiEN. He is not decisive in the past year. He wasn't decisive
prior to the last 2 years, but he is a well-respected member of the
council by the other councilmen. They listen to his advice.
530 ORGANIZED CRIMEl IN INTERSTATE COMMERCE
Mr. Halley. I have no other questions right now.
The CiiAiRMAivr. I have one or two questions, Mr. Cohen.
You were talking about Mr. Shepherd, to whom these deeds were
sent at the city halL It was his duty to represent the city in the matter
of zoning litigation in which several S. & G. members were interested
in getting part of Miami rezoned ; is that correct?
Mr. Cohen. That is correct.
The Chairman. So there might possibly be a conflict of interest if
he weie representing them at that time. That is, they stood to profit
by the rezoning of certain parts of the city of Miami Beach.
Mr. Cohen. Yes, if he were to do something, but let me explain
what did happen.
The Chairman. All right, sir.
Mr. Cohen. The Firestone estate is an estate of 700 feet. They
were zoned for estate use; that is, a single- family dwelling in that
particular area. They brought suit against the city of Miami Beach
claiming that the zoning ordinances were arbitrary, unreasonable, and
void and contrary to law, not having the best use out of the property
as it was in the state that it was in. Certain members of the S. & G.
owned some land immediately north of that property, not beside it,
but a few thousand feet away. The Firestone people went into court ;
and, the minute they did, Mr. Shepherd entered his appearance for
the city of Miami Beach and then went to the city council and asked
them for special counsel in this case to appear with him, and he was
to assist them. The firm of Ward & Ward, which are highly reputable
people, attorneys in Miami, took over' this case with Mr. Shepherd.
The city was unsuccessful in tlie circuit court. The court ruled with
the Firestone people, and Mi'. Shepherd then came to the city council
and the city council authorized them to appeal the case. They took
the case up to the supreme court, and the supreme court reversed the
circuit court. In other words, Mr. Shepherd then, with Mr. Ward,
won his point.
The Chairman. That is, won the point on rezoning.
Mr. Cohen. On rezoning. Then the Supreme Court granted a re-
hearing without additional briefs or arguments, and 6 months later
reversed their previous stand.
The Chairman. So the city lost the case.
Mr. Cohen. So they lost it.
The Chairman. Then, Mr. Cohen, did you participate in the recall
petition of Melvin Eichards?
Mr. Cohen. I told every friend that I had to go down and register
for that thing, to recall Melvin Kichards.
The Chairman. In other words, you did all you could to get him
recalled.
]SIr. Cohen. Yes.
The Chairman. The S. & G. joined you in that?
Mr. Cohen. No, they had nothing — they asked me to stay out of
that, and I told them to mind their own business, it didn't reflect
in my work for them, and they could not control me on that.
The Chairman. Did you have a part in making any arrangements
with the radio station to carry the broadcasts in support of the recall
petition ?
Mr. Cohen. No, I did not.
ORGANIZED CRIME' IN INTERSTATE OOMME'RCE 531
The Chaikm-an. Mr. Cohen, how much was Russell paid when
S. & G. was wound up and dissolved here recently?
Mr. CoiiEx. The fiirures have not been— they have an asset like the
boat, which they are selling. They have it up for sale. They have
certain furniture which they have up for sale. What they have
done
The Chairma>s\ In other words, there hasn't been a final cash
distribution.
Mr. Cohen. That is right.
The Chairman. Has he been sent any check at all, do you know ?
Mr. Cohen. Not that I know of. In fact, as I told Mr. Halley, we
have not been able to tell Mr. Russell that it is dissolved.
The Chairman. You don't know where he is?
Mr, Cohen. I have no idea where he is.
The Chairman. Have you tried to find him?
Mr. Cohen. Yes.
Tlie Chairman. You haven't heard a word from him?
Mr. Cohen. I haven't heard one word from Mr. Russell.
The Chairman. Senator Hunt, do you have any questions?
Senator Hunt. No.
The Chairman. For the record, has gambling been more or less in
recent years or has it been about the same ?
Mr. Cohen. It is about the same. Senator.
The Chairman. Governor Warren, I believe, was inaugurated in
January 1949.
Mr. Cohen. That is correct.
The Chairman. He serves until 1953. Who was the governor be-
fore then ?
Mr. Cohen. Millard Caldwell.
The Chairman. From 1945 to 1949 ?
Mr. Cohen. That is correct.
The Chairjvian. Governor Holland from 1941 to 1945?
Mr. Cohen. That is correct.
The Chairman. Cohen from 1937 to 1941 ?
Mr. Cohen. That is correct.
The Chairman. Scholtz from 1933 to 1937?
Mr. Cohen. That is correct.
The Chairman. Carlson from January '29 to '33.
Mr. Cohen. That is correct.
The Chairman. Governors cannot succeed themselves.
Mr. CopiEN. No, they cannot under our State law.
The Chairman, I believe that is all.
Do you have any statement you want to make, Mr. Cohen, any ex-
planation ?
Mr. Cohen. I think not, sir.
The Chairman. We appreciate your appearance here today.
Mr. Cohen. Thank you.
The Chairman. The committee will stand in recess until 2 o'clock
this afternoon.
(Wliereupon, at 12 :30 p. m., the committee recessed until 2 p. m. the
same day.)
532 ORGANIZED CRIME' IN INTERSTATE OOMME'RCE
AFTERNOON SESSION
(The committee reconvened at 2 p. m., pursuant to recess.)
The Chairman. The committee will come to order.
Mr. Jules Levitt, please, if you will come around.
Mr, Levitt, do you solemnly swear the testimony you will give this
committee will be the truth, the whole truth, and nothing but the
truth, so help you God?
Mr. Levitt. I do, sir.
TESTIMONY OF JULES LEVITT, MIAMI BEACH, FLA., ACCOMPANIED
BY BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
The Chairman. Let the record show that Mr. Ben Cohen is appear-
ing with Mr. Jules Levitt as his attorney.
Mr. Cohen. That is correct.
Mr. Halley. What is your address, Mr. Levitt ?
Mr. Le\t:tt. Miami Beach, Fla.
Mr. Halley. What is your business ?
Mr. Levitt. Finance business.
Mr. Halley. You are in the finance business ?
Mr. Levitt. Yes, sir.
Mr. Halley. Were you, prior to its dissolution, a member of the
S.&G. Syndicate?
]\Ir. Levitt. Yes, sir.
Mr. Halley, During the month of July, this committee held hear-
ings in Miami and made a number of very strenuous efforts to find
you and serve a subpena on you. I know I personally spoke twice to
your son on the telephone. Would you explain to the committee why
it was so difficult to find you and get your testimony ?
Mr. Le\ttt, At the time, I was up in Jacksonville, I have a brother
up there who had a stroke up there at the St. Michael Hotel. I was
spending my time up there with him. He had a stroke.
Mr. Halley. You made no effort to communicate with the committee
and let them know where you were, did you ?
Mr. Levitt. No, sir, I did not. I was very busy. I couldn't leave
there because he was almost dying at the time.
Mr. Halley. You could have gotten to a telephone.
Mr. Levitt. No doubt I could.
Mr. Halley. You did read in the paper that the committee was
trying to find you ?
Mr. Levitt, I didn't get no paper up there. Senator,
Mr. Halley. You didn't know the committee was trying to find you ?
Mr. Levitt. I heard they were trying to find me.
Mr. Halley. You were in Miami until just a few days before the
committee hearings, weren't you ?
Mr. Levitt. I was there the first time when they were trying to sub-
pena our bookkeeper. Then I got a call to come to Jacksonville. My
brother had a stroke.
Mr. Halley. That happened just before the committee hearing?
Mr. Levitt. Yes, sir ; a day or two before it.
Senator Hunt. Mr. Levitt, will you pull the mike a little closer to
you, please, or move it?
JNIr. Levitt. Yes, sir ; thank you.
ORGANIZED CRIME' IN INTERSTATE OOMIVIERCE 533
Mr. Halley. Didn't you have advice of counsel not to appear
Mr. Levitt. No, sir.
Mr. Halley. Because it might tend to incriminate you?
Mr. Levitt. No, sir.
Mr. Halley. Can you exphiin the coincidence that none of the mem-
bers of the S. & G. Syndicate could be found ?
Mr. Levitt. I knew nothing about the rest of the members. I was
up in Jacksonville at the time.
Mr. Halley. Isn't it strange that your own son — he is a boy who is
in college, isn't he ?
Mr. Levitt. Yes, sir.
Mr. Halley. Wouldn't he have known you were in Jacksonville with
your brother if somebody asked him ?
Mr. Leviti'. He was in town at the time. I wasn't home at the time.
I was gone at the time.
Mr. Halley. You didn't hide your whereabout from your son?
Mr. Levitt. No, I didn't.
Mr. Halley. He told me that you and your wife had gotten into the
car and just disappeared.
Mr. Levitt. We went up to Jacksonville.
Mr. Halley. Do you customarily just disappear without leaving any
word as to where you have gone, particularly when a brother is very
sick?
Mr. Levitt. This was an emergency at the time, sir.
Mr. Halley. Wouldn't you ordinarily let your son know where you
were ? You don't just disappear from your home, do you ?
Mr. Levitt. I didn't have time to let him know at the time. I was
kept at the house all day and all night there.
Mr. Halley. You were served with a subpena a few days ago,
weren't you?
Mr. Levitt. Yes, I think it was about a week ago, sir.
Mr. Halley. You recall having been served right at your home, is
that correct ?
Mr. Levitt. Yes, sir.
Mr. Halley. Why did you attempt to run away when your process
server tried to serve a subpena on you that time ?
Mr. Levitt. We agreed to volunteer to come up ourselves. Mr.
Cohen agreed to come up and take the subpena.
Mr. Halley. Who is "we"?
Mr. Levitt. Tlie boj^s, Mr. Salvey, I think it is Eddie Rosenbaum,
and myself.
Mr. Halley. With whom did you make that agreement?
Mr. Levitt. Mr. Cohen.
. Mr. Halley. You made such an agreement with Mr. Cohen ?
Mr. Levitt. That we would appear ; yes, sir.
Mr. Halley. How did that relate to the fact that when a committee
investigator appeared to serve a subpena on you, you broke loose and
ran?
Mr. Levitt. I didn't know who he was. I never saw the gentleman
before.
Mr. Halley. He just stepped out of a car and called your name,
isn't that right?
Mr. Levitt. I don't know. He don't know me. I don't think the
aentleman knows me.
534 ORGiANIZE'D CRIME: in IN'TERSTATE COMMERCE
Mr. Halley. You didn't even have your shoes on, did you ?
Mr. Levitt. I just came from the country at the time.
Mr. Halley. Yet you jumped out of the car and ran around the
house and onto another lot. Why would you do that ?
Mr. Levitt. I didn't run. I walked around.
Mr. Halley. You didn't walk. He had to chase you. If you had
had shoes on, he -probably couldn't have caught you.
Mr. Levitt. I don't know.
Mr. Halley. Isn't it a fact that you have been trying to avoid the
subpena of this committee?
Mr. Levitt. No, sir.
Mr. Halley. In any event, you are here now, and you are here
jDursuant to that subpena that was served on you ?
Mr. Levitt. Yes, sir.
Mr. Halley. Did you hear the testimony of Ben Cohen?
Mr. Levitt. I did, sir.
Mr. Halley. Was that in substance the fact and the truth ?
Mr. Levitt. Yes, sir.
Mr. Halley. Do you have anything you would like to say tliar would
change it or alter it, or is there any respect in which j^ou wouM want
to correct it?
Mr. Levitt. No, sir.
INIr. Halley. Is there anything you would like to add to it
Mr. Levitt. No, sir.
]Mr. Halley. How long have you been in the bookmaking b: iiness?
Mr, Levitt. I have been in the finance business for about 1 years.
Mr. Halley. How long have you been in the bookmaking business?
Mr. Levitt. We finance books.
Mr. Halley. You participate with books on a half interest, don't
y^"- . . . .
Mr. Levitt. We participate with the concessionaires.
Mr. Halley. You share half of their profit; is that right?
Mr. Levitt. Yes, sir.
Mr. Halley. How often were you arrested for bookmaking ?
Mr. Levitt. I have been arrested once or twice for bookmaking, sir.
That is years back.
Mr. Halley. Isn't it a fact that you have been arrested 10 times ?
Mr. Levitt. No, sir.
Mr. Halley. Isn't it a fact that you have actually been con\'icted at
least three times ?
Mr. Levitt. Once or twice.
Senator Wiley. What for?
Mr. Levitt. For gambling.
Mr. Halley. What kind of gambling?
Mr. Levitt. Bookmaking. That was, I think, around 19^10.
The Chairman. That is not since you have been in the finance busi-
ness? You were out operating a book yourself ?
Mr. Levitt. That is right.
The Chairman. When you were arrested and convicted?
Mr. Levitt. That is right, sir.
The Chairinian. When you got in the big-time business you did not
get arrested any more?
Mr. Levitt. I was never a bookmaker. I don't ever take a bet.
ORGANIZED CRIME IN INTERSTATE COMMERCE 535
Senator Wiley. What State was that in ?
Mr. Ll\ FIT. Miami, Fla.
Mr. Halley. You heard Mr. Cohen testify tliat the S. & G. Syndicate
took hiy-otf bets?
Mr. Levitt, That is rio;ht, sir.
Mr. Haeley. Is tliat bookmakintr?
Mr. LEVT'rr. You might call it bookmaking.
Mr. Halley. It was boolanaking. Don't quibble about it.
Mr. Levitt. Yes, sir.
Mr. Halley. Are you a member of S. & G. Syndicate?
Mr. LicviiT. Yes, sir.
Mr. HsaT.ley. Then you did make book, and you have been making
book ri.'^lit along on laj'-off bets, at least?
Mr. 1 cviTT. On lay-off bets only.
Mr. H ALLEY. That you have been doing directly ?
Mr. Levitt. The concessionaire would give it to the clerk.
Mr. Halley. Your clerk ?
Mr. Levitt. That is right.
Mr. Halley. Don't try to duck it. He worked for you, didn't he?
Mr. LuvriT. That is right, sir.
Mr. , ALLEY. When the gambler lost his bet you made the money,
didn't ^<()U?
Mr. II^ViTT. That is right.
Mr. 1; ALLEY. The lay-olf bets were the big bets, weren't they, that
were toOJi)ig for the individual concessionaire to handle?
Mr. L«viTT. That is right.
Mr. Halley. You also participated, I believe you said, with these
concessionaires, and you got half of their profit?
Mr. Levitt. That is right.
Mr. Halley. You have been a partner in the Sunny Isles Club?
Mv. Levitt. Yes, sir.
Mr. Halley. That has been a fairly profitable operation, hasn't it?
Mr. Levitt. The books w^ill show.
Mr. Halley. In fact, in at least one year, 1917, your personal income
from that was well over $50,000, wasn't it ?
Mv. Levitt. I don't remember that, sir.
Mr. Halley. If your books show it, would that be right?
Mr. Levitt. Yes, sir.
The Ci/AiRMAN. Is that what they show ?
Mr. Halley. Yes.
Senator Wiley. Llis share, you mean?
Mr. Halley. Yes ; his personal share.
The total profits of Sunny Isles were something like $290,000 for
1947, weron't they, which was its top year?
Mr. LEtiiTT. I refuse to answer that. I have an internal case coming
against me.
Mr. Halley. You mean an internal revenue case?
Mr. Levitt. Yes, sir.
Mr. Halley. And on that question you wish to assert your |)rivilege ?
Mr. Levitt. Yes, sir.
Mr. Halley. Is that on the ground that your answer would tend to
incriminate or degrade you?
Mr. Levitt. Yes, sir.
68958 — 50 — pt. 1- 35
536 0IRGANIZE1> CRIME' IN INTERSTATE COMMERCE
Mr. Halley. Under Federal law, tlie internal revenue law, is that
right ?
Mr. Levitt. Yes, sir.
Mr. Hallet. I don't think I have any other questions of this wit-
ness.
The Chairman. Mr. Levitt, perhaps you can throw some light on
how you got in touch with this fellow Russell, who became a member
of your partnership, the S. & G. The S. & G. did not need any
financing. All of you had plenty of money, did you not?
Mr. Levitt. Yes, sir; we had money.
The Chairman. You did not need any new capital for your opera-
tions ?
Mr. Levitt. No, sir.
The Chairman. Y ou had been in the business long enough to know
the technique of financing the kind of business you were in, had
you not?
Mr. Levitt. Yes, sir.
The Chairman. Wliy did you take Russell into this business?
Mr. Levitt, The same as Mr. Cohen said.
Senator Wiley. Speak up a little louder.
Mr. Levitt. The same as Mr. Cohen in his statement here.
The Chairman. When did you first know Mr. Russell ?
Mr. Levitt. I have seen Mr. Russell on the beach off and on 8 or 10
times in the last 5 years.
Tlie Chairman. Did you know him well ?
Mr. Levitt. Not too well, sir.
The Chairman. You knew before you took him in that he had been
squealing on you to this fellow Crosby so they could make raids on
S. & G. places, did you not?
Mr. Levitt. I knew nothing about that, sir.
The Chairman. You did not know that?
Mr. Levitt. No, sir.
The Chairman. Was he a close friend of yours ?
Mr. Levitt. Not too close.
The Chairman. Did you make the first contact with him?
Mr. LE\^TT. Yes, sir.
The Chairman. When was that, do you recall?
]Mr. Levitt. I don't recall the date, sir.
The Chairman. Was it a month before he came in as a partner,
or when ?
]\Ir. Levitt. It might have been a week before he came in as a
partner.
The Chairman. A week before he came in as a partner. Is that
the first time you approached him?
Mr. Levitt. Yes, sir.
The Chairman. Where was he?
Mr. Levitt. I called him.
The Chairman. Did you call him at his home?
Mr. Levitt. Yes, sir.
The Chairman. What did you tell him?
Mr. Levitt. I told him that the boys wanted to talk to him and
discuss something with him.
The Chairman. Y^our wire service was off at that time?
Mr. Levitt. I don't think so, sir. I am not sure.
OORGAlSriZED CRIME' IN INTERS'T'A^E OOMME'RCE 537
The Chairman. If it was a week before he came in as a partner, the
record shows it was off.
Mr. Levitt. I don't remember that. I haven't been around the office
much in the last couple of months.
The Chairman. You said the boys wanted to see him. Then what
happened ?
Mr. Levitt. We had a meeting with him, I think the next day.
Tlie Chairman. Did he come over to your office ?
Mr. Levitt. He came over to our office.
The Chairjman. Were all the boys there?
Mr. Levitt. Eddie Lucky, myself
The Chairman. Eddie who ?
Mr. LEVi'rr. Eddie Rosenbaum.
The Chairman. Eddie Lucky ?
Mr. Levitt. That is a nickname for Rosenbaum, Myself, and
Charlie Friedman.
The Chairman. And was Mr, Ben Cohen there ?
Mr, Levitt. No, sir.
The Chairman. Then what did you tell Mr. Russell when he came
over?
Mr, Levitt. We told him that we would like for him to come in
with us.
The Chairman. What did you tell him you would like for him
to come in for ? Why did you want him in your business ?
Mr. Levitt. Because we understand he was taking some hotels, we
heard he was taking some hotels.
The Chairman. You heard he had been around to see some of the
hotels ?
Mr. Levitt. Yes, sir.
The Chairman. You had other competition there on Miami Beach,
did you not ?
Mr, Levitt. They weren't out taking any new hotels or trying to
get our spots.
The Chairman. Is it not rather strange that you would take in one
fellow who had just come in, and you had other competition and you
had not taken them in, too ?
Mr. Levitt. The same as Mr. Cohen said, he had a connection with
the hotels, he knew the owners of various hotels.
Senator Wiley. Move your chair closer to the mike.
The Chairman. Mr. Cohen said Russell had connections with the
hotels?
Mr. Levitt. We heard that. Not Mr. Cohen.
The Chairman. Where did you hear that he had connections with
hotels?
Mr. Levitt. From the hotel owners.
The Chairman. Wlio told you that?
Mr. Levitt. I don't remember any certain one.
The Chairman. Would the hotel owners tell you they were going
to pull away from you and do business with him ? ^
Mr, Levitt. They kind of hinted to us. The concessionaire told us
that.
The Chairman, He did not have any wire service, or anything.
How could he go into business ?
538 ORGANIZED CRIMEI IN INTERSTATE COMMERCE
Mr. Levitt. Anybody can get wire service.
The Chairman. He did not have an office and never had. been in
the bookie business there, had he ?
Mr. Levitt. Anybody can get wire service as long as you pay for it.
The Chairman. Had he ever been in any bookie business before,
that you knew of ?
Mr. Levitt. I wouldn't know, sir.
The Chairman. Wliat did he do before that?
Mr. Levitt. I understand he booked in Chicago.
The Chairman. Where did you understand that from?
INIr. Levitt. He told me, himself.
The Chairman. You knew that when you took him in ?
Mr. Levitt. Yes, sir.
The Chairman. What was the discussion about the wire service
when you had him there in the office ?
Mr. Levitt. No discussion at all.
The Chairman. How did you arrive at this figiire of $20,000?
Mr. Levitt. We reorganized and put up a new bankroll. We each
put up $20,000.
The Chairman. Do you not think $20,000 is mighty little for a
one-sixth interest in a partnership of this kind that made very sub-
stantial amounts of money?
Mr. Levitt. No ; I wouldn't say that.
The Chairman. It took in $26,000,000 in 1 year.
Mr. Levitt. I don't know the figures. The books will show the
figures.
The Chairman. $20,000 would be very much less than any of you
would make out of the business in one average year, would it not?
Mr. Levitt. No. This year I don't think we will show any profit.
The Chairman. I know, but I mean during a good year you would
make very much more than that, each one of you. I do not want to
ask you specifically what you made. We have the records, and I
know you have an income tax matter.
Was he to work in the office or to do anything?
Mr. Levitt. We decided to go into the baseball business, and he
was going to take care of the baseball end of it.
Tlie Chairman. Did he ever do any work?
Mr. Levitt. He organized the baseball game for us.
The Chairman. He got his one-sixth share from that time on?
Mr. Levitt. Yes, sir.
The Chairman. Did you investigate him in Chicago and find out
who he was, or anything about him ?
Mr. Levitt. He told me himself he had never been arrested for
any violation.
The Chairman. Did you check any of his associations or his ad-
dresses?
Mr. Levitt. No, sir. He said he wasn't associated with anybody,
that he was by himself.
The Chairman. Was the whole contract made on that first visit?
Mr, Levitt. I don't remember.
The Chairman. Did you bring him into the partnership then?
Mr. Levitt. I am i)retty sure we agreed right then to take him in.
The Chairman. Tliat is all there was to it?
Mr. Levitt. That is right, sir.
ORGANIZED CRIME! IN INTERSTTATE COMMERCE 539
The Chairman. Do you remember when your wire service went
off?
Mr. Levftt. No, sir; I don't.
The Chairman. You remember the occasion ?
Mr. Levitt. I wasn't there at the time.
The Chairman. Where were you ?
Mr. Lp:vitt. My chid was in the hospital, very sick, at the time
that all that happened.
The Chairman. When the wire service first went off, where did
you get the bootleg wire service from?
Mr. Levitt. New Orleans, sir.
The Chairman. What company?
Mr. Le\ttt. I think we sent a boy up there to relay it out of a book
up there. What book, I didn't know.
The Chairman. How did you get it out of New Orleans, by tele-
phone ?
Mr. Levitt. By telephone.
The Chairman. You did not get it from this fellow across in
Miami ?
Mr. Levitt. No, sir.
The Chairman. You did not get it from Mr. Craig at all?
Mr. Levitt. No ; I don't know Mr. Craig.
The Chairman. You know Mr. Craig who operates a finance busi-
ness in the city of Miami, do you not ?
Mr. LE\aTT. I never met Mr. Craig, sir.
Tlie Chairman. You know him, do you not?
Mr. Levitt. I have heard of him in the newspapers.
The Chairman. You have never met him?
Mr. Levitt. No, sir.
The Chairman. What is the name of the company you got the
service from in New Orleans?
Mr. Levitt. It was just a book.
The Chairman. Just a book?
Mr. Levitt. Yes, sir.
Tlie Chairman. Do you remember a message, after you had this
bootleg service for some time, coming across that if they did not stop
furnishing wire service to S. & G. all service in Florida would be cut
off?
Mr. Levitt. No ; I don't remember. I wasn't there at the time, sir.
The Chairman. You heard about such a message, did you not?
Mr. Levitt. No ; I never. I never even heard that.
The Chairman. You did not?
Mr. Levitt. No, sir.
The Chairman. Anyway, the wire service was completely shut off,
was it not, even what you were getting from New Orleans?
Mr. Levitt. We continued to get it from New Orleans, sir.
The Chairman. I know, but I mean for a time you did not get any
wire service?
Mr. Levitt. We still continue to get it from New Orleans.
The Chairman. How do you account for the fact that during a two-
week period you did not have any in's at all on your books?
Mr. Levitt. We might not have been doing any business at the time.
The Chairman. If you had had wire service, you certainly would
540 ORGANIZED CRIME' IN INTERSTATE COMMERCE
have kept on doing business ? It was at the height of the season, was
it not, in February ?
Mr. Levitt. We might have. We might have missed a day or two
here. I wouldn't remember that, sir.
The Chairman. What negotiations did you have to get the wire
service back?
Mr. Levitt. I had nothing to do with that.
The Chairman. Who handled that?
Mr. Levitt. I really don't remember, sir.
The Chairman. What was your position with the S. & G. ? Were
you secretary or treasurer, or what?
Mr. Levitt. No ; we didn't have no official capacities like that.
The Chairman. Did you work in the office?
Mr. Levitt. No, sir ; I worked on the outside.
The Chairman. Who would have had the negotiations to get the
wire service back?
Mr. Levitt. I really don't know, sir.
. The Chairman. Do you think it would have been your brother ?
Mr. Levitt. No; he had nothing to do with that. He was just the
cashier.
The Chairman. Mr. Salvey?
Mr. Levitt. No, sir.
The Chairman. Mr. Cohen? Did Mr. Sam Cohen work in the
office?
Mr. LE\aTT. He worked on the outside with me sometimes.
The Chairman. What did you do on the outside ?
Mr. Levitt. Oh, just go around and checking a little bit.
The Chairman. Did you go around and make collections?
Mr. Levitt. No, sir.
The Chairman. What did you check on when you checked around ?
Mr. Levitt. Just went around the hotels once in a while.
The Chairman. Just to see how your agents were getting along?
Mr. Levitt. Yes, sir.
The Chairman. Did you check up on their books ?
Mr. Levitt. No, sir.
The Chairman. You do not know anything about the negotiations
to get the wire service back?
Mr. Levitt. No, sir.
The Chairman. Did you handle the deal for the purchase of this
boat?
Mr. Levitt. No, sir.
The Chairman. Who handled that?
Mr. Levitt. I don't know. I knew we had a boat.
The Chairman. You mean the boat just came ?
Mr. Levitt. I Imow we bought a boat. That is all I know about it.
The Chairman. Were you not consulted about spending $20,000
for a boat ?
Mr. Levitt. They said something about a boat, and I said, "What-
ever you sign is all right with me." I don't remember.
The Chairman. You mean that is just such a small transaction you
would not bother about it?
Mr. LE\TrT. No, sir.
The Chairman. What about it? Did you know you were going
to buy a boat?
ORGAlSriZED CRIME' EST ESTTERSTATE COMME'RCE 541
Mr. Levitt. I heard we were going to buy a boat.
The Chairman. Who did you hear that from?
Mr. Levitt. P^rom one of the partners, I don't remember who.
The CiiAiRMAX. You cannot remember?
Mr. Levitt. No, sir.
Senator Wiley. Did your boat come in ?
(No response.)
The Chairman. What were you going to buy a boat for, anyway?
Mr. Levitt. We all like to fish, sir.
The Chairman. That made the second boat you had, did it not?
You already had one boat?
Mr. Leviit. No, sir. Mr. Sam Cohen had a boat. We used his
boat.
The Chairman. You mean you just spent $20,000 on a boat just
casually, and did not know who you were going to buy it from and
did not see it before you bought it, or anything?
Mr. Levitt. That is right, sir.
Tlie Chairman. You did not go down and see it?
Mr. Levitt. No, sir.
The Chairman. Do you know Tony Accardo ?
Mr. Levitt. No, sir.
The Chairman. You never saw him?
Mr. Levitt. In my life. I never saw him in my life.
The Chairman. How did you happen to buy the boat from him?
Mr. Levitt. I really don't know.
The Chairman. You do not know who negotiated the deal ?
Mr. Levitt. No, sir.
The Chairman. I must say, Mr. Levitt, you have a remarkable un-
familiarity with the business that you were in.
Mr. Levitt. I was never around the business much.
The Chairman. How old are you ?
Mr. Levitt. Forty-five.
The Chairman. You never were around the business very much?
Mr. Levitt. No, sir.
The Chairman. Before you went into the syndicate, did you oper-
ate a wire-dispensing place ?
Mr. Levitt. AVe booked at the time, individuals.
The Chairman. You mean you were a concessionaire yourself?
Mr. Levii-t. Yes ; we had two places of our own.
The Chairman. You and your brother?
I ■ Mr. Levitt. No, sir; my brother liad nothing to do with it at that
time.
The Chairman. Who are "we'' ?
Mr. Levitt. Charlie Friedman and myself.
The Chairman. What places did you have then?
Mr. Levitt. That was 10 years ago. I don't remember the places
How.
The Chairman. How did this syndicate get formed? Were you
6iie of the moving factor's in getting all these groups together?
Mr. Levitt. We thought it more profitable to join together.
The Chairman. To pool all of your business ?
Mr. Levitt. That is right, sir.
542 ORGiANIZED CRIMEA IN INTERSTATE COMMERCE
The Chairman. It did turn out to be more profitable, too, did it
not?
Mr. Levitt. Yes, sir.
The Chairman. What casino or night club do yon operate or have
an interest in ?
Mr. Levitt. The Sunny Isles Casino.
The Chairman. Did you not operate Club Collins, too, at one time ?
Mr. Levitt. No, sir.
The Chairman. Does your brother operate Club Collins?
Mr. Levitt. No, sir.
The Chairman. Were you at Sunny Isles the night Mr. Crosby and
Mr. Burke came ?
Mr. Levitt. Sunny Isles ?
The Chairman. Yes.
Mr. Levitt. I don't believe so.
The Chairman. Was that not raided one night when you were
there ?
Mr. Levitt. No, sir.
The Chairman. Perdue came out to the Sunny Isles, did he not,
when he was reinstated, and you ordered him out ?
Mr. Levitt. He was at the bar at the time, sir.
The Chairman. The bar is a public place.
Mr. Levitt. I don't think it was the place for a policeman to be at
the time.
The Chairman. And Perdue w^as the head of the racket squad, as
I remember it, on Miami Beach. Anyway, he made all the raids, if
any were made?
Mr. Levitt. I don't know his capacity.
The Chairman. You remember the chief of police said he did not
want to have anything to do with this gambling place?
Mr. Levitt. I don't know anything about it.
The Chairman. So he turned it over to Mr. Perdue. Mr. Perdue
came out to your Sunny Isles, and was around the bar, is that right ?
Mr. Levitt. Yes ; he was at the bar.
. The Chairman. That was a public place, was it not ?
Mr. Levitt. It was a private club, sir.
The Chairman. Anyway, he had a right to come in there?
Mr. Levitt. A private club, no, sir.
The Chairman. You ordered liim out and he went out?
Mr. Levitt. Yes, sir; that is right.
The Chairman. Do you not think that is showing a lot of power,
ordering a policeman out of a place?
Mr. Levitt. I was doing it for his own good, I thought.
The Chairman. You mean you thought he might be in danger
around there, is that the situation?
Mr. Levitt. I don't know why.
The Chairman. Why did you do it for his own good? What do
you mean?
Mr. Levht. I don't know. I thought I was doing it for his own
good ?
The Chairman. Why did you think you were doing it for his own
good?
Mr. Levitt. I couldn't answer that.
ORGANIZED CRIME' IN IN^TERSTATE COMMERCE 543
The CiiAiRMAX. There niiist have been somethino; in your mind
about it. Why did yon tliink it would be good for him to order him
out ?
Mr. LEVirr. Because we have a room upstairs, a place of chance
upstairs, a'nd I didn't think it was the proper place. He was out of
his jurisdiction at the time, anyway.
The Chairmax. Out of his jurisdiction?
Mr. Levitt. Yes, sir.
The Chairman. That was not in Miami Beach?
Mr. Levitt. No, sir.
The Chairman. You had a game of chance upstairs and you did not
want him around there ?
Mr. LEVi'rr. That is right, sir.
The Chairman. Did you tell him that?
Mr. Levitt. No ; I didn't explain that at all.
The Chairman. How about these operating expenses that bookies
w^ere charged ? Some of these l)ookies have testified that they paid
$75 a week for i)olice protection, and that was collected by S. & G.,
or perhaps $50 a week. What about that ?
Mr. Levitt. The records would show the income on that.
, The Chairman. I know, but what was done with it? Was any of
it paid for protection ?
Mr. Levitt. No, sir.
The Chairman. You are sure of that ?
Mr. Levitt. I will swear to that.
The Chairman. What was it collected for? What is all that opera-
ating expense (
Mr. Levitt. That was the expense to run; I mean the expense we
had.
. The Chairman. You know what "ice money" is ?
Mr. Levitt. Yes, sir, but
The Chairman. Did you collect "ice money" from bookies?
Mr. Levitt. No, sir.
The Chairman. Did you pay any when you were a bookie?
Mr. Levitt. No, sir.
The Chairman. You did not?
Mr. Levitt. No, sir.
The Chairman. Senator Hunt, do you want to ask any questions?
Senator Hunt. I have only one question, Mr. Chairman.
Would you tell the committee why the syndicate is being dissolved ?
Mr. Levitt. I think I have had enough of all this publicity.
Senator Hunt. Did you feel that, if you continued the operations
that you have been carrying on for the last few years, you were going
to get in trouble, in deep water, and by dissolving the syndicate you
were going at least to cool tlie fire off your organization for a while?
Did you have in mind operating by some other method ?
Mr. Levitt. No, sir.
Senator Hunt. What do you have in mind ?
Mr. Levitt. I intend to do a little farming.
Senator Wiley. Did you say "reforming"?
Mr. Levitt. No ; farming.
Senator Hunt. In other words, you are now prepared to go
legitimate ?
544 ORGANIZED CRIME' IN INTERSTATE OOMME'RCE
Mr. Levitt. That is right, sir.
Senator Hunt. I have nothino; more.
The Chairman. Senator- Wiley ?
Senator Wiley. Just a few questions.
This man Russell has been talked about. Do you feel at this time
that his connection with you was not a case of "muscling in" on
you ?
Mr. Levitt. No, sir.
Senator Wiley. What do you say about that?
Mr. Levitt. We thought it was profitable to take him in because it
looked like he was going to take some of our top hotels.
Senator Wiley. Did he threaten to take them ?
Mr. Leavitt. No : he didn't do no threatening.
Senator Wiley. You say he came from Chicago. Apparently none
of you had any real knowledge of who he was; but you felt that in
view of his activities, you could lose some business. Is that what you
felt?
Mr. Levitt. That is right, sir.
Senator Wiley, So you took him in ?
Mr. Levitt. That is right, sir.
Senator Wiley. In this meeting that you had, was it very friendly
all along the line 'i
Mr. Levitt. Very friendly.
Senator Wiley. You said, "Dear Mr. Russell"'
Mr. Levitt. No; we didn't say that.
Senator Wiley. "We would like you to come in with us"?
Mr. Levitt. No ; we didn't say "dear."
Senator Wiley. You did not ? Wliat did he have to say ?
Mr. Levitt. He didn't have much to say. He did a lot of listening.
Senator Wiley. He said, "Boys, I am with you if you will take me
in"; is that it? 20,000 bucks. How much did he take out of it?
Mr. Levitt. Nothing. He lost on his deal.
Senator Wiley. He did what ?
Mr. Levitt. He lost money on it.
Senator Wiley. He did ?
Mr. Levitt. Yes, sir.
Senator Wiley. Did he get in with the other groups that were
operating down there?
Mr, Levitt. I knew nothing about that, if he did.
Senator Wiley. The chairman of the committee said something
about i)ayments that had been made to officials. Do you swear that
you personally, or to your knowledge your organizationn, did not pay
any of the officials for protection of any kind or pay them any money?
Mr. Leviti'. I do, sir.
Senator Wiley. You were arrested 10 times, did you say?
Mr. LEvii^r. No, sir. Once or twice, I said, Mr, Kefauver, I think,
said 10 times.
Senator Wiley. Once or twice. Do you tliink it Avonld be twice?
Mr, Levitt. I think so, sir; once or twice, I am not sure. That is a
few years back. I don't remember.
Senator Wiley. Do you mean tliat it was such as unusual experience
you could not say whether it was two times or one time ?
Mr. Levi rr. That was about 10 years ago, I think.
ORGANIZED CRIME! IN INTERSTATE COMMERCE 545
Senator Wiley. You did not serve any time?
Mr. Leviit. No, sir.
Senator Wiley. Do you remember how much of a fine you paid ?
Mr. Levitt. I was indicted by a grand jury, but I didn't serve no
time. I think I paid a $500 fine.
Senator Wiley. Each time ^
Mr. Leviti\ Yes, sir ; each time.
■ Senator Wiley. Then you kept right on operating? You joined up
with this organization, the S. & G. ?
Mr. Levitt. I didn't do no booking then. We financed other
bookies.
Senator Wiley. Was it on the basis talked about this morning; all
those financial arrangements you had with the other bookies, you cot
60-50 out of it?
Mr. Levitt. That is right, sir.
Senator Wiley. This matter of where you got the news to go ahead
and operate. You got it, until Continental was out of there some 2
years ago, from them ; did you ?
Mr. Levitt. We got it, as far as I know, from Dave Byrnes. Who
he got it from, I don't know, sir.
' Senator Wiley. Was there a squeeze on by some of these Chicago
folks to take over the gambling in Miami ?
Mr. Levitt. No, sir.
Senator Wiley. You know nothing about it ?
Mr. Levitt. No, sir.
Senator Wiley. Is it not a fact that that is the main reason why you
folks decided to get out of the business ?
. Mr. Leviti\ No, sir.
Senator Wiley. No pressure from outside whatever?
Mr. Levitt. No, sir. It looks like the newspapers put us out of
business.
Senator Wiley. What ?
Mr. Levitt. It looks like the newspapers put us out of business.
Senator Wiley. You got out of it because you felt the notoriety, as
stated this morning by Ben Cohen, was injurious to your loved ones?
Mr. Levitt. That is right, sir.
Senator Wiley. You think you could have stood it, yourself?
I Mr. Levitt. I have two grown boys, sir.
Senator Wiley. Have you any other business ?
Mr. Levitt. I deal in real estate, sir,
I Senator Wiley. You had been dealing in real estate previously, too,
while you were connected with the S. & G. ?
Mr. Levitt. For the last 10 3^ears; yes, sir.
Senator Wiley. Before that, you were not in the real-estate business 2
Mr, Levitt, No, sir.
Senator Wiley. Is that pretty profitable?
Mr. Leviti'. I haven't got no profit yet, but no doubt I will have.
Senator Wiley. You are getting an education now?
Mr. Levitt. Yes, sir.
Senator Wiley, That is all,
Mr. Levitt. Thank you.
Senator Hunt. Do you own any stocks in any banks in Chicago or
New York?
546 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Levitt. No, sir.
Senator Hunt. Are you interested in the cleaning and dyeing estab-
lishments in Chicago?
Mr. Levitt. No, sir.
Senator Hunt. Do you own any public-utility stocks ?
Mr. Levitt. No, sir.
Senator Hunt. Are you interested in a distillery in Chicago?
Mr. Levitt. No, sir. I haven't been to Chicago in the last 15 years,
sir.
Senator Hunt. Are you interested in any hotels ?
Mr. Levitt. No, sir.
Senator Hunt. Are you a director of any company in any line of
industry or activity now ?
Mr. Levitt. No, sir.
Senator Hunt. You are not in the food-processing game?
Mr. Levitt. No, sir.
Senator Wiley. Not even Florida orange juice?
Mr. Levitt. No, sir.
Senator Hunt. That is all.
The Chairman. Mr. Levitt, you said that Mr. Russell had lost on
his investment. You have not made a final distribution yet; have you?
Mr. Levitt. Not yet, sir, but the first statement would show that we
lost. We had a statement.
The Chairman. You have not sold your assets yet ?
Mr. Levitt. We are trying to sell them now, sir.
The Chairman. How do you dissolve a partnership unless all the
partners agree? When did Russell agree to dissolve this partnership?
Mr. Levitt. Russell didn't agree. He wasn't there. We held a
meeting ourselves. There were five of us.
The Chairman. You mean without his being there?
Mr. Levitt. Yes, sir.
The Chairman. Yqu were in touch wdth him, were you not?
Mr. Levitt. No, sir.
The Chairman. You did not call him up ?
Mr. Levitt. No, sir.
The Chairman. Did you have a letter from him ?
Mr. Levitt. No, sir.
The Chairman. You did not take up the matter with him as to
whether he wanted to dissolve the partnership or not?
Mr. Levitt. No, sir.
The Chairman. Do you not think he is going to be awfully mad
about it when he hears about it ?
Mr. Levitt. I think he will be very happy about it.
The Chairman. You think he will be very happy about it?
Mr. Levitt. Yes, sir.
The Chairman. Where is Mr. Russell ?
Mr. Levitt. I don't know, sir.
The Chairman. Where did you hear from him last ?
Mr. Levitt. I haven't heard from Mr. Russell in about a month.
The Chairman. Where was he then ?
Mr. Levitt. He was in Miami at that time, sir.
The Chairman. When did he leave Miami ?
Mr. Levitt. I don't know.
ORGAlSriZED CRIME! IN INTERSTATE OOMMETRCE 547
The Chairman. About the time you went to Jacksonville?
Mr. Levitt. . I really don't know, sir.
The Chairman. You have not had a letter or any message from him
at all?
Mr. Levitt. No, sir.
The Chairman. How about his lawyer?
Mr. Levitt. I don't know his lawyer.
The Chairman. Have you heard from any lawyer.
Mr. Levitt. No, sir.
The Chairman. All rijiht.
Is there anything else, Mr. Halley ?
Mr. Halley. Do you have any interest in the New Casablanca
Hotel now being built?
Mr. Levttt. No, sir.
Mr. Hali^ey. Have you invested any money in it ?
Mr. Levitt. No, sir.
Mr. Halley. Has any member of your family ?
Mr. Levitt. No, sir.
Mr. Halley. Have you ever been in any other business than book-
making ?
Mr. Levitt. No, sir.
Mr. Halley. When you say "real estate," you mean you invest your
money in it ?
Mr, Levitt. That is right.
Mr. Halley. You are not a broker ; are you ?
Mr. Levitt. No, sir.
Mr. Halley. You just take your profit from the gambling business
and put it into real estate ; is that right ?
Mr. Levitt. Put it in real estate ; yes, sir.
Mr. Halley. What business have you ever had ?
Mr. Levitt. In the last 20 years, I have been in the gambling
business, sir.
Mr. Halley. You have been a bookie ?
Mr. LE\TrT. That is right.
Mr. Halley. That is all.
The Chairman. All right, that is all, Mr. Levitt.
(Witness excused.)
The Chairman. Mr. Leo Levitt, will you come around, please ?
Mr. Levitt, do you solemnly swear the testimony you give this
committee will be the truth, the whole truth, and nothing but the truth,
so help you God ?
Mr. Leo Levitt. I do.
The Chairman. All right, Mr. Halley.
TESTIMONY OF LEO LEVITT, MIAMI BEACH, FLA., ACCOMPANIED
BY BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
Mr. Halley, You are a brother of Jules Levitt ?
Mr. Levitt. Yes, sir,
Mr. Halley. You heard the testimony of Ben Cohen this morning?"
Mr. Levitt. Yes, sir.
Mr. Halley. Is it the truth, to the best of your knowledge?
Mr. Levitt. Yes, sir.
548 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Halley. Is there anything you would want to add to it or
correct about it ?
Mr. Levitt. Not a thing, sir.
Mr. Halley. You heard the testimony of your brother, Jules,
now?
Mr. Levitt. Yes, sir.
Mr. Halley. Was that substantially correct?
Mr. Levitt. Yes, sir.
Mr. Halley. Is there anything you would want to add to that or
any correction you would want to make ?
Mr. Levitt. Not a thing, sir.
Mr. Halley. You handled the bookkeeping for the S. & G., is that
rig'ht?
Mr. Levitt. No, sir. I am the cashier.
Mr. Halley. The cashier?
Mr. Levitt. That is right.
Mr. Halley. You signed the checks, is that right ?
Mr. Levitt. That is right, cosigner.
Mr. Halley. It was to you that the bookies would come for advances
and for all financial relations?
Mr. Levitt. That is right.
Mr. Halley. Would they come to you at the offices of S. & G. ?
Mr. Levitt. Some of them did, and some of them we had collectors;
go around and collect from them and pay to them.
Mr. Halley. What was the system? Did you collect from the
bookies their daily take every day ?
Mr. Levitt. Yes, sir; the next day we would collect our pay,
whatever it was the day before.
Mr. Halley. How often would you settle with the bookie ?
]Mr. Levitt. At the end of the month ; and then later on, we settled
at the end of each season. Some of them were seasonal accounts and
some were monthly accounts. '■
Mr. Halley. Was it in your office that they had the records of the
bets that were made? As I understand, every time a bookie made a.
bet with the customers, lie had to call that in to the S. & G.
Mr. Levitt. No, sir; that wasn't in mv office.
Mr. Halley. What office was that?
Mr. Levitt. In the other office where telephones and clerks handled
tlie bookies.
Mr. Halley. What office was that ? >
Mr. Levitt. We had quite a few of them scattered around town.
Mr. Halley. Is it a fact that you actually had five going around
and phicing bets with these bookies, and they would call the bet in to
make sure the bookie would call them in?
Mr. Levitt. No, sir. '
Mr. Halley. You did something to make sure the bookie wasn't
holding out on you, didn't you ?
Mr. Levitt. I don't know. I never had anything to do with that.
Mr. Halley. You had a large ]>ayroll, didn't you ^
Mr. Levitt. Quite a few help Avorking for us in the office.
Ml-.. Halley. What were their various cai)acities?
Mr. Levitt. There was the manager's office, the clerks who handled
the phones, and calculators, and a board man.
iiroii
ORGANIZED CRIME IK INTERSTATE OOMME'RCE 549
Mr. Halley. Didn't yon have people whose duty it was to ^o aronnd
and clieck up on tlie operation of the bookie?
Mr. Levitt. No, sir; not that I know of; not on our j>avroll.
Mr. Halley. Not at all?
Mr. Levitt. Not that I know of.
Mr. Halley. Are you sure of that ?
Mr. Levitt. That is ri<:;ht.
Mr. Halley. If anybody had said his duty was to go around and
place bets with bookies and then ])hone in to make sure that the
bookie had reported the bet ju-onij^tly to S. & G., that person would be
telling an untruth?
Mr. Levitt. That I don't know. As far as I am ccmcerned, I didn't
have anything to do with it.
Mr. Halley. You have no knowledge whatsoever of it?
Mr. Levi'it. That is right.
Mr. Halley. What were the functions of the various members of
S. & G. ? What did Jules Levitt do ?
Mr. Levitt. He was on the outside.
Mr. Halley. He didn't s])end very mucli time on the business, did
he?
Mr. Levitt. Not that T ever seen him in the office, no, sir.
Mr. Halley. More on the outside. I think he spent most of his time
fishing, isn't that right?
Mi-. Levitt. Yes, sir,
Mr. Halley. What did he ever contribute that would justify his
ai'ge income from S. & G.?
Mr. Levitt. That I wouldn't know. I am just the cashier. I
wouldn't know.
Mr. Halley. One of the people who originally put this thing to-
gether, is that right ?
Mr. Levitt. That is right.
Mr. Halley. By virtue of having joined, they controlled this large
business?
Mr. Levitt. That is right.
Mr. Halley. You were the cashier?
Mr. I^EViTT. That is right.
Mr. Halley. Do you have any i:)articipation in Jules Levitt's in-
tei'est ?
Mr. I EViTT. No. sir.
Mr. Halley. Wliat function did Rosenbaum perform?
Mr. Levitt. Mr. Rosenbaum was up in the office as complaint
manager.
Mv. Halley. The complaint manager?
Mr. T EViTT. That is right.
Mr. Haleey. Wlio made com])laints?
Mr. Levitt. If any concessionaires had any complaints, or if they
lad a claim or anything, they would call Mr. Rosenbaum, and he
ivould take care of it for them.
Mr. Halley. Where was his office?
Mr. Levitt. In the Mercantile Bank Building.
Mr. Halley. Didn't he have his office at the top of the Cromwell
Hotel?
Mr, Levht. Not that I know of. We had an office there, an office
i^'ith phones, and clerks worked up there.
550 ORGANIZED CRIME,' IN INTERISTATE OOMME'RCE
Mr. Halley. You had a penthouse up there ?
Mr. Levitt. There was an office up there. We had phones, and
the clerks worked up there just like the other offices scattered on the
beach.
Mr. Halley. It was a very elaborate place, the top of the Cromwell ?
Mr. Levitt. It is an office with a long table, with phones and chairs.
That is all we had.
Mr. Halley. It has terraces and some very beautiful rooms ?
Mr. Levitt. It is a nice place ; yes.
Mr. Halley. I might say, I wasn't there to see your operation, but
the Army had it during the war, and I saw it then. Isn't it a fact
that in that operation, phone calls were made all over the country
to check up on bets that were placed, to make sure that nobody was
putting anything over on the S. & G., and that wise money wasn't
ganging up on a hot horse ?
Mr. Levitt. I think so.
Mr. Halley. What was the system ?
Mr. Levitt. I never was up in the office there. My office was at
the Mercantile Building.
Mr. Halley. I understand ; but from your general knowledge, what
was the system ?
Mr. Levitt. I couldn't explain. I don't know much about it, really.
Mr. Halley. Isn't it a fact that you had telephone connections
with big bookmakers throughout the country ?
Mr. Levitt. Not that I know of, sir.
Mr. Halley. Isn't it a fact that when a bet came in that looked
suspicious, from that office at the top of the Cromwell phone calls
would be made throughout the country to find out if a lot of money
was being bet on the same horse in various other places?
Mr. Levitt. That I wouldn't know, because I never was up there
in charge of it or took care of it. I just took care of my own business,
and that is all.
Mr. Halley. W\\o was in charge up there ?
Mr. Levitt. Well, I think Mr. Rosenbaum was in charge up there.
Mr. Halley. He is here today ?
Mr. Levitt. That is right.
Mr. Halley. In connection with your work, you signed most of
the checks ; is that right ?
Mr. Levitt. Yes, sir,
Mr. Halley, We have certain checks here we would like you to
look at and tell the committee a bit about them.
First, on the telephone company checks, would you identify these
for the record? Are these typical checks made out to the Southern
Bell Telephone Co. ?
Mr, Levitt. These checks represent the telephones tliat were in our
office alone, which we used to contact the concessionaires. They
haven't anything to do with the concessionaire at all. We paid these
phones,
Mr. Halley. They were your own phones ?
Mr. Levitt. That is right.
Mr. Halley. You had all tliose ]:»hones in your own office ?
Mr, LEViTr. In the difFeront offices, that is right.
Mr. Halley. It would be 50 or 100 ]ihones?
Mr. Levitt. That is right. They were scattered around the differ-
ent offices.
OlRGAlsPIZED CRIME' IN INTERSTATE COMMERCE 551
Mr. Hai.lp:y. "Who condiicteil the negotiations with the Bell Tele-
phone Co. !'
Mr. Lkviit. One of the partners. I wouldn't know.
Mr. Halley. Which one'^
Mr. Levitt. I wouldn't know which one it was.
Mr. Haleey. It wouldn't l)e your brother? He was an outside
man.
Mr. Levitt. That is right.
Mr. Haeley. Would it be Friedman?
Mr. Levitt. That I don't know, sir.
Mr. Hai.ley. He was also an outside man, wasn't he?
Mr. Levitt. That is right, most of them worked on the outside.
Mr. Halley. Rosenbaum was the only inside man, in fact, wasn't
he?
]\Ir. Levitt. That is right.
Mr. Halley, I understand Salvey did nothing, is that right ?
Mr. Levitt. That is right, sir.
Mr. Hai-ley. What was he paid for?
Mr. Levitt. That I don't know.
Mr. Haixey. He didn't even try to be an outside man, did he?
Mr. Leviti\ Tliat I don't know, sir.
Mr. Halley. He had no functions at all, as I understand it.
Ml'. Levitt. I haven't seen him around the office.
Mr. Halley. Was he being paid for his relationship with Burbridge
on the city council ?
IVIr. Levitt. That I don't know, sir.
Mr. Halley. Did you never have a conversation with anybody in
the phone company?
Mr. Levitt. No, sir, I never had anything to do with that.
Mr. Halley. Did you ever have to arrange for telephone service,
for a new line?
]\Ir. Levitt. Not me, sir.
TT
AlAlA^l-.Y,
You never did that at all ?
Mr. Levitt. No, sir.
Mr. Halley. Do you know who did it ?
Mr. Levitt. You mean as far as for our own phones?
Mr. Halley. Yes.
Mr. Levitt. One of the partners. I don't know which one.
Mr. Halley. It would have to be Rosenbaum?
Mr. Levitt. That I wouldn't know. I never was there when he did
talk to them, if he did.
Mr. Haij:.ey. How about the wire service? Who took care of that?
Mr. Levitt. That I don't know. I didn't have anything to do with
that.
Mr. Halley, You made out the checks ?
Mr. Levitt. I signed the checks. The checks were made out by
the accountant,
Mr. Halley. Who told you how much to make them out for?
Mr. Levitt. The service people, Mr. Byrnes, would tell us how
much it was.
Mr. Halley. Who is Mr. Byrnes? Does he represent the wire
service ?
Mr. Levitt, Yes, sir.
(iSUSS — 50 — i)t. 1 It)
552 ORGANIZED CRIME' IN INTERSTATE OOIVIMERCE
Mr. Halley. That is the Intrastate Co.; is that correct?
Mr. Levitt, I don't know who it was made out to or who he is.
Mr. Hallet. You made the checks out to various companies, didn't
you? You made it out to the news company over in Miami?
Mr. Levitt. Whoever he told us, the name.
Mr. Halley. You mean the name would change from time to time?
Mr. Levitt. That I don't know. I never noticed it.
Mr. Halley. Did he come in and tell you what to do?
Mr. Levitt. He took the check up to the accountant's office and told
the accountant who to make it out to.
Mr. Halley. Did you ever talk to him ?
Mr. Levitt. Oh, yes, I talked to Dave. I know him around the
beach.
]Mr. Halley. Did vou talk to him at the time the wire service was
cutoff?
Mr. Levitt. No, sir; I never had anything to do with that.
Mr. Halley. What did you do when the wire service was cut off?
There must have been a lot of consternation.
Mr. Levitt. We had service from New Orleans that was coming in
for a while, and we were working.
Mr. Halley. Are you willing to state under oath that that service
was coming from New Orleans?
Mr. Levitt. That is right.
Mr. Halley. That is your sworn testimony?
Mr. Levitt. That is right. We had a fellow in New Orleans giving
it to us over the telephone.
Mr. Halley. You swear also that you were not getting it from any
other place in Florida?
Mr. Levitt. Not that I know of.
Mr. Halley. Can you explain why it was not shut off from New
Orleans when it was shut off over the State of Florida?
Mr. Levitt. That I don't know.
Mr. Halley. It doesn't make much sense, does it ?
Mr. Levitt. I never had anything to do with it. I don't know any-
thing about it.
Mr. Halley. To the best of your knowledge, you would say it came
from New Orleans?
]\Ir. Levitt. That is where it came from.
Mr. Halley. If you had nothing to do with it, who told you?
Mr. Levitt. That is what I heard.
Mr. Halley. From whom did you hear it?
Mr. Levitt. From the differe-iit partners.
Mr. Halley. Which partner? Let's be specific.
Mr. Levitt. Whoever was up in the office.
Mr. Halley. AVho was it ? Please think.
Mr. Levitt. It might have been either Charlie or Eddie.
Mr. Halley. You say it might have been Charles. You mean
Charles Friedman?
Mr. Levitt. Yes.
Mr. Halley. Or Rosenbaum ?
Mr. Levitt. That is right.
Mr. Halley. Can you he more definite than that?
Mr. Levitt. Those are the only two I can think of who were up
there at the time.
ORGANIZED CRIME; IN INTERSITATE COMMERCE 553
Mr. Halley. I show you a check for $3,000 made out to Cash, and
ask. you what that was for? F'robably the endorsement will help
you.
Mr. Levitt. That I don't know, sir. The books reflect who this
went to and what it was for.
Senator Wiley. How much is it ?
Mr. Levitt. Three thousand dollars, sir.
Senator Hunt. Who was it made to ?
Mr. Levi'it. It is made out to Cash.
Senator Hunt. Who endorsed it?
Mr. Levitt. It is Ed P-e-t-r-y.
Senator Hunt. Who is he?
Mr. Levitt. That I don't know, sir.
Mr. Halley. That is P-e-t-r-y, isn't it? Don't you know him?
, Mr. Levitt. No, sir.
Mr. Halley. There is another endorsement on it. Can you make
it out ?
Mr. Levitt. I can't make out who it is.
Mr. Halley. Those people mean nothing to you?
Mr. Levitt. No, sir.
Mr. Haixey. That is dated December 20, 1948?
Mr. Levitt. That is right.
Mr. Halley, I show "you another $3,000 check made out to William
Burbridge, treasurer. Will you tell the committee about that one?
Mr. Levitt. This was the donation, it says, for Barry College.
Mr. Halley. It is not a donation. It is for a Trocadero dinner, it
says on the check. What would that mean?
Mr. Levitt. That I don't know.
Mr. Halley. What is Barry College?
Mr. Levitt. It is a college for nuns in Miami.
Mr. Halli^y. Was Mr. Burbridge handling it?
Mr. Levitt. Ihat I don't know.
Mr. Halley. Did he give a dinner of some kind at the Trocadero ?
Mr. Levitt. I don't know.
Mr. Halley. You signed the check.
Mr., Levitt. That is right.
Mr. Halley. On whose instructions did you sign the check ?
Mr. Levitt. The accountant might have had instructions from one
of the bosses to make it out.
Mr. Halley. It looks very much to me that nobody seems to know
anything; that you just wrote checks and you can't remember who told
you. That business didn't run itself. It was a very large business.
Who ran the business? Your brother was never there.
Mr. Levitt. The business ran itself, mostly.
Mr. Halley. These things were pretty substantial. Checks for
$3,000 didn't write themselves.
Mr. Levitt. One of the bosses must have called the accountant and
told him to make out the check.
Mr. Halley. You are the cashier and you signed the check.
Mr. Levitt. I signed the checks; that is right.
Mr. Halley. Which boss told you to sign it ?
Mr. Levitt. I usually sign checks up in the accountant's office. He
pays bills with them that way.
Senator Wiley. How much is that check?
554 ORGANIZED CRIM.E; IN INTERSTATE COMMERCE
Mr. Levitt. $3,000.
Mr. Halley. Didn't Harry Voiler run the Trocadero?
Mr. Levitt. The Trocadero Restaurant ; yes sir.
Mr. Halley. He publishes a newspaper out there that has been very
favorable to gambling, hasn't it?
Mr. Le\t[tt. Not now. It is out of business.
Mr. Halley. He did publish it?
Mr. Levitt. Yes, sir.
Mr. Halley. It sided with the S. & G. quite frequently, didn't it ?
Mr. Levitt. I imagine it did. I don't know.
Mr. Halley. It was on the side of gambling ?
Mr. Levitt. That is right.
Mr. Halley. What was the name of that paper, the Miami Light?
Mr. Levitt. No, the Morning Star — the Morning Mail.
The Chairman. The Miami Light is the one in Miami, and it does
about the same thing. It condemns the committee and takes up for
gambling operations.
Mr. Levitt. That I don't know ; just what I read, sir.
Mr. Halley. The S. & G. also rented office space from Voiler, did
they not?
Mr. Levitt. That is right.
Mr. Halley. They paid him an annual rent of $3,000 a year?
Mr. Levitt. That is right, whatever the books reflect on it, I don't
know.
Mr. Halley. Over how long a period would that be ?
Mr. Levitt. I imagine the last 5 or 6 years.
Mr. Halley. Where were you when the committee tried to serve
a subpena last month ?
Mr. Levitt. My brother in Jacksonville was very sick. He had a
stroke, and I was up there at the same time,
Mr. Halley. Do you also make a practice of leaving your home
and office without even leaving word as to where you are ?
Mr. Levitt. My wife knew where I was.
Mr. Halley. Why was it impossible for the committee to get any
information out of anybody at your home or your office as to your
whereabouts ?
Mr. Levitt. The office was closed. It had been closed quite a while.
The office has been closed. I haven't been around the office in quite
a while.
Mr. Halley. Wliy wouldn't your wife be able to tell the committee
if you were away on legitimate business? Why wasn't the statement
made ?
Mr. Levitt. She told whoever came that I was out of town.
Mr. Halley. You were at a definite place where you could be
reached. It was apparent you were out of town.
Mr. Levitt. That is right.
Mr. Halley. Wliy the secrecy?
Mr. Levitt. That I don't know.
Mr. Halley. They must have been your instructions.
Mr. Levitt. She knew I was out of town, and she told the party
that came to the house that I was out of town
Mr. Halley. We asked where you could be reached. She knew,
didn't she?
Mr. Levitt. I guess she did.
ORGANIZED CRIME! EST INTERSTTATE COMMERCE 555
Mr. Halle Y. Wliy did she say she didn't?
Mr. Levitt. That I don't know.
Mr. Halley. Didn't you tell her to?
Mr. Levitt. No, sir.
Mr. Halley. No further questions.
The Chairman. Senator Hunt?
Senator Hunt. I have just one question. Do you sign checks in
blank?
Mr. Levitt. Yes, sir ; a lot of times I do.
Senator Hunt. You sign the checks without knowing what later
ie going to be written into that check?
Mr. Levitt. That is right. It is all recorded in the book by the
accountant.
Senator Hunt. That is all I have.
Senator Wiley. Does not the book account show what those are
paid for?
Mr. Levitt. It should be, in the accountant's books it should show
what it was. I don't have anything to do with the books. I don't
take care of them.
Mr. Halley. The books show that it was for wire service. I am
talking about the $3,000 check.
Mr. Cohen. Gentlemen, I know about this Barry College thing,
and the Trocadero, if I may interrupt to tell you about it.
The Chairman. Surely. Tell us.
Mr. Ben Cohen. They w^ere having a fund-raising affair for Barry
College, which is a Catholic institution. Everyone who is invited
there had free meals on tlie house, and then they all gave contributions
to Barry College. Mr. Burbridge is one of the founders of Barry
College, and Monsignor Barry, for whom the college was named. The
S. & G. paid for the dinners of those who attended this fund-raising
meeting at the Trocadero Restaurant. Mr. Burbridge is the one who
evidently charged it, and he was given this check. It shows what it
was for, for the Trocadero dinner. He obligated himself and the
S. & G. promised to pay for it.
The Chairman. You mean the S. & G. paid $3,000 for one dinner?
Mr. Cohen. Yes. Not for one dinner ; for one gathering. They
took up the whole restaurant that evening.
The Chairman. S. & G. footed the bill for the whole gang?
Mr. Cohen. For the whole thing, and the people who were there
made their contributions to Barry College. They felt they could get
more people there, and once you got them there they would donate,
if you told them there was no charge for the dinner.
Senator Wiley. Wliat was the other check for?
Mr. Cohen. That I don't know, Senator.
The Chairman. Does the committee staff know what it was for?
Mr. Halley. The other one is for wire service, according to the
books.
The Chairman. Why would wire service be paid for in cash?
Mr. Levitt. That I don't know.
The Chairman. What did your wire service run? . Up to $20,000
some weeks?
Mr. Levitt. You mean what we paid for it ?
The Chairman. Yes.
556 .0!RGANIZED CRIME! IN INTERSTATE OOMMERCE
Mr. Levitt. I really couldn't tell you. The books would reflect
what they paid for it.
The Chairman. We have records here from your books, showing
the wire service ran to $2,500 a week in season, and dropped down to
$600; is that correct?
Mv. Levitt. Tliat is correct, sir.
The Chairman. Did you negotiate with the wire service?
Mr. Levitt. No, sir.
The Chairman. Did you negotiate about this boat that was bought
from Tony Accardo?
Mr. Levitt. No, sir.
The Chairman. Who did that ?
Mr. Levitt. That I don't know.
The Chairman. Did you ever see the boat?
Mr. Levitt. Yes, sir.
The Chairman. Before you bought it?
Mr. Levitt. No, sir.
The Chairman. Who would you think negotiated it?
IVfr. Levitt. That I don't know, sir.
The Chairman. Were you consulted about buying it?
Mr. Levitt. No, sir. 1 am not a partner in the organization.
The Chairman. Aren't you a partner?
INIr. Levitt. No, sir.
The Chairman. You are just the bookkeeper?
Mr. IiE\T:TT. Cashier, that is all, sir.
The Chairman. How much are you paid ?
Mr. Levitt. $150 a week.
Mr. Halley. That is all.
The Chairman. Any other questions?
Senator Wiley. How much did you get out of the organization?
Mr. Levitt. A salary, sir.
Senator Wieey. Just $150 a week?
IVIr. Levitt. That is right, plus a bonus at the end of the year.
Senator Wieey. You were not really, then, a partner ?
Mr. Levitt. I am not a partner, no, sir; just an employee.
The Chairman. I believe that is all, thank you, Mr. Levitt.
(Witness excused.)
The Chairman. Mr. Rosenbaum. will you come around?
Do you solemnly swear that the testimony you will give the com-
mittee will be the whole truth and nothing but the truth, so help you
God?
Mr. Rosenbaum. I do.
TESTIMONY OF EDWARD ROSENBAUM, MIAMI, FLA., ACCOMPANIED (
BY BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
Mr. Halley. What is your address?
Mr. Rosenbaum. 1040 Venetian Way, Miami, Fla.
Mr. Halley. What is your business?
Mr. Rosenbaum. We finance bookmaking.
Mr. Halley. And participate in the profits, is that right?
Mr. Rosenbaum. Participate in the profits ; yes, sir.
Mr. Halley. You also handle lay-off bets from your bookmakers?
Mr. Rosenbaum. Yes; we do, sir.
ORGANIZED CRIME' IX INTERSTATE CX)MME'RCE 557
Mr. Hallev. Booking them directly yourselves?
Mr. KosENBAUM. Yes, sir.
]\Ir. Halley. You take a very substantial pai't in the management
of the various concessionaires who operate under you, isn't that
correct ?
Mr. RosEXBAUM, Yes; I am quite active in the business.
Mr. Hallev. You watch them very carefully in their operations?
Mr. RosENBAt'M. Yes, sir.
Mr. Hallet. Where were you when the committee tried to serve a
subpena in Miami for the open hearings?
Mr. RosENBAirM. I was away on vacation, Mr. Halley.
Mr. Hai-ley. Where were you ?
Mr. RosENBAt'M. I was down on the Keys in Florida.
Mr. Halley. When did you leave ?
Mr. RosEXBAUM. I left approximately a week before the committee
came to Florida.
Mr. Halley. Were you advised by your office and your home and
the jiewspapers and radio that the committee was trying to get in
touch with you ?
Mr. RosEXBAUM. I wasn't advised from home, but I naturally knew
of it through the newspapers and radio.
Mr. Hai-ley. Did you make any attempt to consult your counsel
and find out whetlier or not you should come to Miami to testify?
Mr. Rosexbafm. The reason I didn't do that, Mr. Halley, was
because of the tax situation that was being reviewed, and I thought
that I might be in jeopardy, and the entire tax thing might be airecl in
the newspapers, and I didn't think it advisable under those conditions,
knowing that we eventually would appear at your request in
Washington.
Mr. Halley. You didn't know that at the time.
Mr. Rosexbafm. Eventually we would appear before the commit-
tee.
Mr. Halley. You knew sooner or later you would have to come.
You couldn't run forever.
Mr. RosEXBAUM. That is it, exactly.
Mr. Halley. You couldn't stay fishing off the Florida Keys.
Mr. RosEXBAUM. Not very well, sir.
Mr. Halley. Were vou one of the original founders of the S. & G.
back in 1944?
Mr. RosEXBAuM. Yes, sir.
Mr. Halley. Have you been known as the inside man in the S. & G. ?
]\rr. RosEXBAUM. I spend most of my time, practically all of it. a
good many hours during the day, in the executive offices at the Mer-
cantile National Bank Building.
Mr. Halley. You conduct the operation?
Mr. Rosexbafm. I wouldn't take credit for all that ; part of it.
Mr. Halley. Let's see. Jules Levitt has said that he is an outside
man and goes out and sees hotel owners and concessionaires and peo-
ple like that, is that right ?
Mr. Rosexbafm. He did that, and would also come into the office
for conferences and the like of that.
Mr. Halley. Where woidd Friedman operate ?
558 OKGANIZED CRIMEI IN EMT'ERSTATE OOMMERCE
Mr. EosENBAUM. He would be on the outside, and also come in,
naturally, for different questions which would arise relative to the
business.
Mr. Halley. What would be Sam Cohen's function 'i
Mr. RosENBLUM. Along the very same lines.
Mr. Halley Outside ?
Mr. RosENBAUM. Outside, and inside for details.
Mr. Halley. What was Salvey's function ?
Mr. RosENBAUM. Salvey wasn't active in the company.
Mr. Halley. He didn't do anything ?
Mr. RosENBAUM. Very little if anything.
Mr. Halley. Why was he retained ?
Mr. RosENBAUM. It dates back to the fact that Mr. Salvey wasn't
too well a man, a sort of neurotic and what not, a case of not being
active.
Mr. Halley. Without again getting into specific figures, in view of
the fact that you have a very significant tax case coming up, Salvey's
participation was rather large, wasn't it?
Mr. RosENBAUM. An equal share, sir.
Mr. Halley. He made quite a bit of money out of S. & G. ^
Mr. RosENBAUM. Yes, sir.
Mr. Halley. A very substantial amount ?
Mr. RosENBAUM. Yes, sir.
Mr. Halley. It would seem to reflect more than what you do for a
sick man out of sympathy.
Mr. Rosenbaum. He was naturally in the original formation of the
company. The fact that he wasn't active was due to the fact that he
wasn't too well a man. There was a sort of understanding.
Mr. Halley. He had certain good political connections at the city
hall, too, didn't he?
Mr. Rosenbaum. He was friendly with some people up there, sir.
Mr. Halley. Particularly with Burbridge, wasn't he?
Mr. Rosenbaum. So it was understood.
Mr. Halley. And you believe it to be true ?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. Burbridge, I think Ben Cohen testified, was the most
influential member of the Miami Council.
Mr. Rosenbaum. He is quite influential and quite popular.
Mr. Halley. Did you hear Ben Cohen's testimony ?
Mr. Rosenbaum. I did, Mr. Halley.
Mr. Halley. You were here?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. Is it substantially correct?
Mr. Rosenbaum. I would say so.
Mr. Halley. Are there any changes you would like to make in it,
or corrections ?
Mr. Rosenbaum. Nothing I can think of at the present time.
Mr. Halley. How did this inside operation run? Just what did
you do? What were your functions?
Mr. Rosenbaum. Different items would come up. People would
come along and want to know if there were hotels available. We
wouldn't rent tliem, but we would make suggestions that so-and-so
,hasu't>been leased,, and the like of that. We would review it.
ORGANIZED CRIME: in ESTTERSTATE COMMERCE 559
Mr. Halley. In otlier words, if a bookie wanted to go into business,
he would drop in on you and you would suggest where he might go
to negotiate for a hotel concession, is that right!'
Mr. RosENBAUM. I would try to point out certain places tliat 1
knew of that were available. You hear that by the grapevine and
by deduction.
Mr. Haix-et. Then he would go to the hotel and try to get the
concession ?
Mr. Rosenbaum. That is it, exactly, sir.
Mr. Halley. If he got it, he then entered into 3'our business on
the basis that we have been discussing?
Mr. Rosenbaum. Yes, sir.
INIr. Halley. That is, he bought the wire service from you?
Mr. Rosenbaum. We would finance the proposition and give him the
wire service.
Mr. Halley. When you say you would finance the proposition, what
do you mean by that ?
Mr. Rosenbaum. Finance the bookie.
Mr. Halley. What financing does the bookie need ?
Mr. Rosenbaum. Just the general operation of it. In other words,
when wagers were made, he had to pay the wagers that were bet.
Mr. Halley. Most of these people had a backlog necessary in the
bookmaking business ?
Mr. Rosenbaum. It took considerable, and a lot of them wouldn't
have enough left to finance themselves in the actual wagering.
Mr. Halley. Some of the concessions weren't so expensive, some
were around $3,000, $4,000, or $5,000 a year.
Mr. Rosenbaum. There were some in that price bracket.
Mr. Halley. They were paid in installments through the season,
weren't they ?
Mr. Rosenbaum. In late years, I would say the majority of them
were on the cash basis.
Mr. Halley. The books show a great man}^ of them are on the
installment basis.
Mr. Rosenbaum. They made payments, that is very possible.
Mr. Halley. Many of these bookies could finance themselves. It
wasn't such a tremendous problem, was it?
Mr. Rosenbaum. I don't know about its being a problem. I know
a good many of them w^ould approach us and we would finance the
venture.
Mr. Halley. And a good many of them wouldn't need financing,
isn't that right? ' .
Mr. Rosenbaum. It could be possible.
Mr. Halley. Isn't it the fact? You didn't finance everybody, did
you?
Mr. Rosenbaum. All those we did business with, we did ; yes, sir.
Mr. Halley. You mean you financed everyone you did business
with ?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. To what extent ?
Mr. Rosenbaum. Of taking their business and paying the losses as
it went along, and participated in the profits.
Mr. Halley. That is not financing them. You just became a
partner. What happened was that they would open the book. At the
560 ORGANIZED CRIME: IN INTERSTATE OOMMERCE
end of the first day, there might be a loss, but generally there was a
profit. Isn't that right ?
Mr. RosENBAUM. Sometimes there would be a profit, and other times
they would sustain a loss, according to the day's business.
Mr. Halx-ey. There obviously was more often a profit than a loss?
Mr RosENBAUM. I would say generally.
Mr. Halley. At the end of the first day, then, in the usual case, the
man would have a profit, is that right, say, of $300 or $400 or $1,000
profit in the till ?
Mr. RosENBAUM. In some cases; in other cases they would go on for
days sustaining a loss, according to the results.
Mr. Halley. The ordinary thing was a profit? It was a profitable
business, wasn't it?
Mr. RosENBAUM. Yes ; I would say it was a profitable business.
Mr. Halley. Therefore, in the usual case there would be a profit, is
that not right ?
Mr. Rosenbatjm. I think you can take that for granted.
Mr. Halley. Your agents came around and collected that cash and
you held it in what I think Mr. Ben Cohen has described as a trust
account.
Mr. RosENBAUM. That is right, or if it was a loss we naturally would
pay him for his loss.
Mr. Halley. But it was most usually a profit?
Mr. RosENBAUM. It is hard to say.
Mr. Halley. Obviously, if the business runs at a profit over the
course of a year, you come out with a very substantial profit running
into. many thousands of dollars ?
Mr. RosENBAUM. Over a period of time.
Mr. Halley. Most of the time you would be showing a profit. We
have the sheets here, if you want to see a typical sheet, or isn't it
necessary ?
Mr. Rosenbaum. That is not necessary, Mr. Halley. The point I
was trying to make is that there are losing days and winning days.
Mr. Halley. Surely, but generally they are winning days ?
Mr. RosENBAUM. Generally, I would say yes.
Mr. Halley. When they won, you came along and collected all the
winnings and held them for the bookie ?
Mr. Rosenbaum. That is right.
Mr. Halley. And settled up at some later time ?
Mr. Rosenbaum. That is right.
Mr. Halley. Wliy wouldn't it be more accurate to say the bookies
were financing you ?
Mr. Rosenbaum. I don't have the answer to that.
Mr. Halley. You were taking their money and holding it. It seems
to me the bookies were for the most part financing you.
Mr. Rosenbaum. I don't have an answer to that version of it.
Mr. Halley. I have been trying to get some light on this operation of '
the Cromwell Hotel. Can you tell the connnittee about that?
Mr. Rosenbaum. The Cromwell Hotel, we had an office, a number of
offices, and that was one of them at the Cromwell. In addition to that,
we would receive information there, that is, a check on horses.
Mr. Halley. Just what happenecl ? That is a phase of the operation
that hasn't been brought out.
ORGANIZED CRIME' IN INTERSTATE (X)MME'RCE 561
Mr. RosENBAUM. I will explain it. In other words, in this particular
business, some business is undesirable, meaning hot horses, to use the
vernacular. In order to be posted on that, we would call throughout
the country different places for that particular information.
. Mr. Halley. a hot horse is a horse on which suddenly there appears
just too much money to be justified by the normal situation, is that
right?
Mr, RosENBAUM. That is it, exactly, yes, sir.
• Mr. Halley. If anybody tries to make a killing on a hot horse, he
places money all over the country so it won't be too apparent ?
Mr. RosENBAUM. That is part of it, and the other part is that certain
horses other than hot horses, certain horses that you just want to check
to see whether or not you have a fair risk in it.
Mr. Halley. Where would you call to check up on the experience
of other bookmakers ?
Mr. RnsENBAUM. I didn't call, Mr. Halley.
Mr. Halley. Where would the calls be made ?
Mr. RosENBAUM. Different towns, I imagine.
Mr. Halley. You know. It was under your direction.
; Mr. RosENBAUM. Jersey, Chicago, and throughout, you. know.
Mr. Halley. You had, then, a general arrangement with various
bookies in other places, didn't you?
Mr. RosENBAUM. An arrangement?
Mr. Halley. Yes.
Ml. Rosenbaum. We just exchanged information.
Mr. Halley. You iiad an arrangement to exchange information,
is that right?
Mr. Rosenbaum. Yes. That is part of the business.
Mr. Halley. In fact, when the track was open and the races were
going along hot and heavy, you had open wires, din't you ?
Mr. Rosenbaum. What do you mean by "open wires"?
, Mr. Halley. You didn't have — if I wanted to call New Jersey
from Florida, I have to get the operator and ask for long distance
and go through a fairly long rigmarole before I get through. You
had a wire that stayed open during the races ?
Mr. Rosenbaum. Not to my knowledge, sir.
Mr. Halley. How would you get that information in time to be
yseful ?
Mr. Rosenbaum. They would make a call. They called certain of-
fices to find out what knowledge they had on that particular horse.
Mr. Halley. Did you make that call, through, before the race
started, and keep that wide open through the race period?
Mr. Rosenbaum. I wasn't in that particular office, and I didn't
make any calls. I know there were no open wires. They wouldn't be
any occasion for an open wire.
]Mr, Halley. The wire was held open. The call was put in and the
call was kept in during the racing day, was it not?
Mr. Rosenbaum. No, sir ; not to my knowledge.
Mr. Halley. Wli ere were the calls made?
Mr. Rosenbaum. Different points.
Mr. Halley. Jersey?
Mr. Rosenbaum. Yes.
Mr. Halley. Where in Jersey?
562 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. EosENBAUM. Probably Newark.
Mr. Halley. Who was your contact there?
Mr. EosENBAUM. I didn''t have a contact there. I don't handle, that.
Mr. Halley.
Mr. Halley. You had employees, salaried employees, didn't you?
Mr. EosENBAUM. Yes. sir.
Mr. Halley. They operated under your direction ?
Mr. RosENBAUM. Not solely mine. Generally, the company,
Mr. Halley. You must have known who they were checking their
information with. It is pretty important information.
Mr. Eosenbadm. I didn't handle that branch of it, sir.
Mr. Halley. Who did ?
Mr. EosENBAUM. An uncle of mine.
Mr. Halley. What is his name ?
Mr. EosENBAUM. George Eosenbaum.
]\f r. Halley. Is he here in Washington ?
Mr. Eosenbaum. No, sir.
Mr. Halley, But he is available ?
Mr. Eosenbaum, I imagine so,
Mr, Halley. He would know just who was contacted in the various
places?
Mr. Eosenbaum. I should say "Yes" to that.
Mr. Halley. You would contact other bookies in Newark, Chicago,
and where else?
Mr. Eosenbaum. As far as California.
Mr. Halley, As far as California?
Mr. Eosenbaum, Yes, sir,
Mr, Halley, This would be a daily occurrence ?
Mr. Eosenbaum, I would say daily,
Mr. Halley. In fact, it was a pretty important part of the business?
Mr. Eosenbaum. It was very important to protect your interests.
Mr. Halley. What do you know about the purchase of a boat from
Tony Accardo ?
Mr. Eosenbaum. I know about the boat ; yes, sir.
Mr. Halley. Will you tell the committee about it ?
Mr. Eosenbaum. Yes, sir. Mr, Sam Cohen, one of our associates,
owned the boat called the Judy. We made an arrangement whereby
myself and my associates could use the boat and pay the charges,
the captain and the like. One of the members of the company came
along and suggested something a little better, and said there was a
boat available over at the boat yards in Fort Lauderdale,
Mr, Hali.ey, What member came along and suggested that?
Mr, Eosenbaum, Mr. Eussell.
Mr. Halley. Harry Eussell ?
Mr. Eosenbaum. That is right. I talked it up a little bit, because I
am quite a fishing enthusiast. He was quite sold on it. A couple of
members of the company didn't think they wanted to invest in the
boat. We kept reviewing it. Finally Mi'. Eussell and I went to Fort
Lauderdale, to the Eody Boat Yard. W^e looked at the boat, which was
then Clara Jo.
Mr. Halley. What happened when you got there ? What made you
decide to buy the boat ?
Mr. Eose.vbaum, We didn't decide to buy it then. We looked at it
and it was very good, a fairly good buy, AVe came back and talked
ORGANIZED CRIME: IN INTERSTATE COMMERCE 563
it up again. It was quite a while later when we finally made a de-
cision to buy it.
Mr. Hali.ey. Were some of the members against it?
Mr. KosENBAUM. Yes.
Mr. Halley. What finally pei-suaded them? How did Russell
prevail upon you to buy the boat ?
Mr. RosEXBAUM. I probably had as much to do with it as Russell.
As I say, 1 am a boat enthusiast and kind of lean that way. We
finally convinced the others and we purchased the boat.
Mr", Halley. How do you account for the fact that the price was
exactly the same as the price that Russell paid to get into S. & G. ?
Mr. Ro8ENBAU3i. That has no bearing on it, Mr. Halley. The asking
price originally on the boat, I believe, was $22,000. You can check at
the Rody Boat Yard. I believe that was the price. We offered $18,000
for it and nothing happened at that and eventually the price was
settled on at $20,000.
Mr. Halley. Did you feel any squeamishness about getting into a
transaction witli Tony Accarclo?
JNIr. RosENBAUM. I had no transaction with Tony Accardo.
Mr. Halley. You paid $20,000 in checks to him.
Mr. RosENBAUM. I had no transaction with him at all.
Mr. Halley. Didn't you consider that a transaction?
Mr. RosENBAUM. What I am trying to say is that I never met
Accai'do and haven't met him to this day and didn't know at the time
that he was the owner of the boat. ^Ir. Russell suggested
Mv. Halley. That is absurd.
Mr. RosENBAUM. I am sorry, it is not absurd. I am telling the
truth. Just that. I never met the gentleman and never negotiated
with the gentleman for the boat and don't know him to this day.
Mr. Halley. Who instructed your casliier to make out three checks,
one for $10,000 and two for $5,000 to Tony Accardo i
Mr. RosENBAUM. Tliat was reviewed in the office and eventually it
came out when we got the papers, the very first time I knew of any
Accardo being the owner of the boat.
Mr. Halley. At that point did you want to back out?
Mr. RosENBAUM. Well, we didn't back out. It was just a coincidence.
Mr. Halley. At that point didn't you realize Russell had gotten you
into a deal with his Chicago associate ?
Mr. RosENBAUM. We didn't know of any Chicago associates.
Mr. Halley. You knew Russell had been a bookie in Chicago.
Mr. RosENBAUM. The owner of a bar and also some booking interests,
I believe.
Mr. Halley. Russell's Bar?
Mr. RosENBAL M. I believe so.
Mr. Halley. He was connected with a fellow named Ralph Pierce.
Mr. RosENBAUM. I don't know Rali)h Pierce.
Mr. Halley. He was also reputed to be in the booking business with
Tony Accardo some years back.
Mr. RosENBAUM. Other than what I have read in the papers, w^e
never knew or had any knowledge of any connections along those
lines.
Mr. Halley. Weren't you even interested in finding out who you
were getting into business with?
564 OR'GANIZE'D CRIMEI IN BSTTERSTATE OOMMER'CE
Mr. RosENBAFM. We just knew of the man as being all right in that
particular line of endeavor and didn't know of any association.
Mr. Halley. Who handled this wire-service deal?
Mr. RosENBAUM, The wire-service deal?
Mr. Halley. Who did the negotiations on the wire service?
Mr. liosENBAUM. As a rule, Charles Friedman knew a little bit more
about that than the other associates. It was reviewed in the office.
Mr. Byrnes would come in and w^e would sort of haggle a price.
Charlie would sort of take upper hand in that matter.
Mr. Halley. Did you deal mainly with Byrnes, you and Charlie
Friedman ?
Mr. RosENBAUM. Yes, I would say. Charlie and I and possibly
another member.
Mr. Halley. What happened when the wire service was cut off in
the month of February 1949 ?
Mr. RosENBALTM. We went out of town for service.
Mr. Halley. Where did you go?
Mr. RosENBATJM. New Orleans.
Mr. Halley. Where else ?
Mr. RosENBAUM. That is all to my knowledge.
Mr. Halley. How did you get your service from New Orleans?
Mr. RosENBAUM. Some would call it in by telephone.
Mr. Halley. Who phoned it to New Orleans ?
Mr. RosENBAUM. It was phoned from New Orleans.
Mr. Halley. How did it get to New Orleans ?
Mr. RosENBAUM. That I don't know. We had a man stationed in
New Orleans, in an office.
Mr. Halley. Who provided it to the New Orleans office?
Mr. RosENBAUM. Some office there, I don't know the name of the
party.
Mr. Halley. You must know where you got it from.
Mr. RosENBAUM. I know we got it from New Orleans but I don't
know the name of the office that this particular party sat in to make
the calls and relay the information.
Mr. Halley. What particular party provided the service to you?
Mr. RosENBAUM. I don't know the name of the bookie.
Mr. Halley. Did you ever know?
Mr. RosENBAUM. No.
Mr. Halley. How did you arrange to get it?
Mr. RosENBAUM. We sent someone in there.
Mr. Halley. Who did you send?
Mr. RosENBAUM. A chap by the name of Eddie.
Mr. Halley. Eddie who?
Mr. RosENBAUM. We call him Captain Eddie.
Mr. Halley. What is his full name?
Mr. RosENBAUM. I really don't know; I can find out. I really
don't know.
Mr. Halley. Was it Mooney ?
Mr. RosENBAUM. Tliat is right ; yes.
Ml-. Halley. Eddie Mooney ?
, Mr. RosENBAi^M. That is correct.
Mr. Halley. Did he go to New Orleans ?
Mr. RosENBAUM. That is riffht.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 565
Mr. Haixey. He made arruii^einents with somebody there?
Mr. RosENBAUM. That is right.
Mr. Halley. Where is Eddie Mooney now?
Mr. Rosenbaum. I really don't know, sir.
Mr. Halley. Did he work for S. & G. ?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. Did he work for you through 1950?
Mr. R(>8enbau]m. He worked until our closing day, I believe.
Mr. Halley. Until just a few weeks ago.
Mr. Rosenbaum. We have been out of business quite a while. We
dissolved recently, but we have been closed for quite a while.
Mr. Halley. Has his residence been in Miami?
Mr. Rosenbaum. Miami Beach, I believe.
Mr. Halley. How were your relations with Craig over in Miami?
Mr. Rosenbaum. I know of Mr. Craig, but I didn't have any deal-
ings with Mr. Craig.
Mr. Halley. Have you ever met Mr. Craig?
Mr. RosENBAiT]M. I have met Mr. Craig.
Mr. Halley. Did Craig provide you with any wire service?
Mr. Rosenbaum. No, sir ; he did not.
Mr. H.-TJFY. None whatever?
Mr. Rosenbaum. No, siu
Mr. Halley. When the service was off what effort did you make to
get it resumed?
]\Ir. R(xsENBAU3i. It went off throughout the State and we just sort
of waited out the conditions to see if there was a change.
Mr. Halley. That is not quite so. It first went out for S. & G.
didn't it, and everybody else was getting it?
Mr. Rosenbaum. It may have been. 1 don't remember whether that
was so or not. I thought it was throughout the State.
Mr. Halley. As the inside man you must have been under great
pressure from your bookies.
Mr. Rosenbaum. A little bit at times,
Mr. Halley. They closed down for a period, didn't they ?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. About 2 weeks?
Mr. Rosenbaum. I believe so.
Mr. Halley. They must have been very unhappy about that.
Mr. Rosenbaum. Not too well satisfied. They would prefer being
in business.
JMr. Halley. There must have been considerable pressure on you
to do something about it.
Mr. Rosenbaum. That is a part of your duty, I suppose to try to
furnish the service that we were selling.
Mr. Halley. What did you do with Mr. Byrnes and the other people
of the wire service? Did you go to them and say why have you shut
down this service ?
Mr. Rosenbaum. I imagine we consulted with them. It would be
natural for us to do that.
Mr. Halley. Let's get away from imagination. What happened?
Mr. Rosenbaum. I just don't remember the details on it, INIr. Halley.
Mr. Halley. Let's get this : In the month of February 1949 you were
paying the very goodly sum of $i>,r)00 a week to the Intrastate News
Service for wire service?
566 ORGANIZED CRIME: IN INTERSTATE OOMME'RCE
Mr. RosENBAUM. I believe that figure is correct.
Mr. Halley. That is a substantial amount of money to pa} "y
week?
Mr. RosENBAUM. That is true.
Mr. Halley. You were paying it to get some service ?
Mr. Rosenbaum. That is correct.
Mr. Halley. That service was shut off?
Mr. Rosenbaum. Yes, sir.
Mr» Halley. You were entitled to loud and raucous coi ,
Mr. RosEXBATTM. We didn't like it any too well.
Mr. Halley. What did you do?
Mr. Rosenbaum. We called Mr. Byrnes in and want' tt.now
what the reason for eliminating the service was. We g< . 'so't of
evasive answer, if I remember correctly.
Mr. Halley. He admitted he cut it off?
Mr. Rosenbaum. I don't know about admitting that )
but we do know it was cut off.
Mr. Halley. He admitted that it had been just cut off
is that right ?
Mr. Rosenbaum. I don't think it came up just that way, xvi y.
Mr. Halley. In what way did it come up ? "Wlio was pres ^sides
yourself and Mr. Byrnes?
Mr. Rosenbaum. I imagine Mr. Friedman may have been ])resent,
possibly Mr. Levitt.
Mr. Halley. Think now. Let's try to avoid the imagin; \eve
and get the facts.
Mr. Rosenbaum. There aren't any facts that I can really ,^)lain
because I just don't know too much detail.
Mr. Halley. I think you are just evading it. I think /ou can
explain it very well. I think you nnist know the detail. It happened
just a year ago and it was a very imjiortant thing in your business. I
would like to get an answer.
IVIr. Rosenbaum. I don't know the answer for it, sir.
Mr. Halley. Your wire service was cut off?
Mr. Rosenbaltm. Yes, sir.
Mr. Halley. Intrastate cut it, obviously.
Mr. Rosenbaum. I imagine it was cut from the source.
Mr. Halley. You bought it directly from Intrastate; is thp^ right?
Mr. RosENBALTM. It was Byrnes' company, whatever it vva .
INIr. Halley. They were the people you had to g/ to t^ get it
resumed ?
Mr. RosENBAu^r. Yes, sir.
]Mr. Halley. Did Byrnes come to your office or did you go to their
office ?
Mr. Rosenbaum. I imagine he came to our office. I nevei" 'lid go or
any of our associates that I know of to his office.
Mr. Halley. You never went to the Intrastate office?
Mr. Rosenbaum. No, sir.
Mr. Halley. Byi-nes came to your office ?
Mr. Rosenbaum. Byrnes came to our office on all occasions.
Mr. IlAr.iJCY. Did he or didn't he come on this occasion?
Ml'. RosENBAU^xi. I believe he did, sir.
Mr. Halley. How many days after the cut-off did this happen?
Mr. RosENi'.AiTM. When he came to the office?
OiRGANlZED CRIME! IN INTE ESTATE CX)MME'RCE 567
Mr. Halley. Yes.
^>,f,,, .RosENBAUM. I really couldn't truthfully say just when. I
in' le \fithin a day or two, I presume.
jVx/. Hali.ey. When it was cut off you must have gotten on the phone
and made a frantic phone call very fast, did you not?
L,"^ ^Sl;NBAU>r. Undoubtedly ; yes, sir.
Mr. LEY. Yes or no.
Mr. k' :-i:xBALTM. I iuuigiue we did do just that, either one or the
0thfYJj;^.f J,
' ' •'i.LEY. I don't want the answer "I imagine" any more. Did
y,, .'t you call Byrnes?
]\i.f ,,. p NBAUM. I personally didn't call him, if that is what you are
referring, ''|0.
M' ^ . ' ■ EY. Did you talk to Friedman about it?
KNBAUM. Yes, sir.
'fi )' 1 \' ' ^^'- -^^^^ y^^^ agree that he would call ?
' ^'-^ V* ' '^rVBAinr. I don't know about the agreement. More than
].r ■ I call. I imagine.
^ '^ . .'-EY. Was it understood that he would call?
' fl ttAA^nbaum. I couldn't say definitely because I just don't know.
He-*^^^ '%ve called right then and there at that time. Whether he
made ^t'lie^call or not, I would have no way of knowing. I would take
for granted that he did.
iSIr. "'^Tai.ley. Then Byrnes showed up immediately, is that right,
at yp'^ iffice?
>■ sENBAuar. There was a meeting with Byrnes shortly after the
serv . ,, 'Y.as cut off.
Mr? ri ALLEY. Witliiu a day or so?
Mr. A- 3ENBAUM. I would say around that.
Mr. HALLEY. Who was present? Were you there at this meeting
with Byi'ues?
]Mr. KosEXBAUM. I was at a good many meetings. Whether I was
there at that particular time or not I couldn't say, Mr. Halley.
Mr. Halley. This was a very important meeting. Your wire serv-
ice had iust been shut off. You were the inside man responsible for
getting [his tremendous business running. You know that even in
1949 your business was over $15,000,000, gross. Even with the shut-
off in the middle of the season, it was a big business. The wire service
was shi'i V;ff and you sit there and try to tell me you don't know whether
you were pi'^^ent or not at the conference.
Mr. xtosENBAUM. I may have been. I am not trying to deny the
fact I was. It is very possible I was, but I just don't remember the
incident.
Mr. Halley. It is not an incident. This is one of the most vital
business conferences you have ever had in your life, in my opinion.
Your \rire service was shut off without explanation. Byrnes came
down to talk about it. I want to know who talked to Byrnes.
Mv. EosEXBAUM. I couldn't truthfully answer that, Mr. Halley. If
I could I would.
Mr. Halley. You could if you wanted truthfully to answer it.
Mr. EosEXBAUM. I beg to differ with you. If l" actually knew who
talked to him at the time I would tell you.
Mr. Halley. Do you remember whether you ever had a conversa-
tion with Byrnes about the shutting off of the wire service?
68958—50 — pt. 1 .37
568 ORGANIZED CRIME' IN INTERSTATE aOMME'RCE
Mr. RosENBAUM. I don't think I talked with him on that matter.
Mr. Halley. You have never talked to Byrnes ?
Mr. RosENBAUM. On that matter. I have talked to Mr. Byrnes.
Mr. Halley. I want to know whether you ever talked to Byrnes
about the shutting off of the wire service.
Mr. RosENBAUM. No; I don't believe I did, sir.
Mr. Halley. Then you would not have been at the conference,
Mr. RosENBAUM. I may have been present in the office. I may have
spoken to him in another anteroom or again it may have come up some
way there. I just don't remember.
Mr. Halley. You mean Byrnes came to the office for a conference
about the shut-off, but you were not present at the actual discussion.
Is that your testimony ?
Mr. RosENBAUM. That is it. I was not present to my knowledge.
Mr. Halley. Not to your knowledge. You know. Your knowl-
edge is very complete on whether you were there or not.
Mr. RosENBAUM. I just don't remember the incident.
Mr. Halley. I won't take an "I don't remember" answer to anything
that important. You just think. Either you were there or you
weren't there. Wliich is it ?
Mr. RosENBAUM. More than likely I was in the office, but I don't
remember being in on the conference with him.
Mr. Halley. You mean you were on the premises. Were you in
the room where the conference took place ?
Mr. RosENBAUM. I don't believe I was.
Mr. Halley. Who was in the room ?
Mr. RosENBAUM. I don't remember. Mr. Friedman may have been.
Mr. Halley. May I ask, Senator Hunt, to call Mr. Friedman and
let's just swear him in and find out whether or not we are going
to get that testimony ?
Senator Hunt. Is Mr. Friedman in the committee room? [No
response.]
Mr, Halley. Is he the one we were unable to serve ?
Mr. Ben Cohen. That is correct, sir.
Mr. Halley. Mr. Cohen, can you explain why all the other members
of the S. & G. have accepted service and Friedman has not?
Mr. Ben Cohen, I can give you my idea of it, I have talked with
Friedman ; I have pleaded with him to come in. He says that "With
my education, no matter what I try to say, they are going to mix me up
to where I w^ould just be a monkey."
I think it is his lack of education and lack of ability to express
himself that causes him to stay away, I have been in touch with him.
I have begged him, "Please come in," and he is a very stubborn man.
I can't get him to do it. I mean I couldn't.
Mr. Halley. ]\Ir. Cohen, were you at this conference concerning the
shut-off of the wire service ?
Mr. Cohen. No.
IVIr. Halley. Were you at any conference?
Mr. Cohen. No. I never sat in on any of their business dealings.
Mr. Halley. You wouldn't know who did confer with Byrnes con-
cerning the shut-off of the wire service?
Mr. Cohen. No; I would not know tliat.
Mr. Halley. Getting back to your testimony, do you know if Sam
Cohen was at that conference ?
ORGANIZED CRIME; IN rNTERSITATE COMMERCE 569
Mr. RosENBAUM, I really don't know, Mr. Halley.
Mr. Halley, You mean we will have to call every member of tlie
syndicate to find out who was present at that conference ?
Mr. RosENBAUM. I just don't remember; I really don't.
Mr. Halley. You can state of your own definite knowledge that
you were not at the conference?
Mr. RosEXBAUM. I was not at the conference.
Mr. Halley. You were not in the room while the shut-off of the
wire service was being discussed?
Mr. RosENBAUM. Not to my knowledge, sir.
Mr. Halley. Is there any reason why you wouldn't know whether
you were in the room or not ?
Mr. RosENBAUM. No reason why I w^ouldn't know. I just don't
recall being present.
Mr. Halley. Eventually the wire service was restored?
Mr. RosENBAUM. Yes, sir.
Mr. Halley. Do you know how that happened?
Mr. RosEXBAUM. No; I don't know how that happened, sir.
Mr. Halley. Who told you the wire service was going on?
Mr. RosENBAUM. We just got a call that the service was being
resumed.
Mr. Halley. There was more to it than that. For instance, when
the service was resumed, you paid your tribute of $2,500 a week for
the period during which you got no service. I call it tribute because
you were paying for no service.
Mr, RosENBAUM, That is very possible.
Mr. Halley. It is not possible. It happened.
Mr. RosENBAUM. I mean it is possible that it was paid,
Mr, Halley. Your books show it w^as paid,
Mr, RosENBAUM, I think undoubtedly it was,
Mr, HalijEY, You were the man in charge of the entire operations ?
Mr, RosENBAUM, No; I think you have that picture wrong,
Mr. Halley. Let's get the picture right.
Mr. RosENBAUM. I mean I was just one of the company. I wasn't
there at all times and didn't negotiate all those transactions.
Mr. Halley. Who negotiated the resmnption of the wire service
and the price to be paid ?
Mr. RosENBAUM. There is a possibility that Charles Friedman did
that. As I say, he was posted more on that branch of the business.
Mr. Halley. Is it your sworn testimony tliat you had nothing what-
soever to do with negotiations leading to the resumption of the wire
service ?
Mr. RosENBAUM. That is correct, sir.
Mr. Halley. You want to stand on the statement that you had noth-
ing whatsoever to do with the negotiation for the resumption of the
wire service?
Mr. RosENBAUM. Yes, sir.
Mr. Halley. Did the shut-off of the wire service have a very sub-
stantial effect on your agreement to take Harry Russell in as a jDartner ?
Mr. RosENBAUM. Not to my knowledge, sir.
Mr. Halley. Are you sitting there and saying it is just a coincidence
that this wire service was shut off and that then a few days latei> it
was agreed to take Russell in ?
570 ORGiANIZED CRIME' IN INTERSTATE COMMERCE
Mr. RosENBAUM. Russell was taken in for the reasons given today:
That the man started to negotiate with hotel owner's. Some of the!
choice ocean-front hotels, whicli is really the major portion of our
business, and a good many of the hotels were controlled by Chicago
interests, Shellburn, Saxony, Robert Richter, and the Seaview, the
like of that. It looked as though that would be quite a loss to our
organization.
Mr. Halley. In fact, the wire service is controlled by Chicago in-
terests, too; isn't that so?
Mr. RosENBAUM. I am not familiar with that other than what you
read and hear.
Mr. Halley. That is what you read and hear; isn't it? You don't
really know who controls the Saxony and the Richter and these other
hotels except what you read and hear?
Mr. RosENBAUM. That is true.
Mr. Haixey. Let's get the facts. Isn't your knowledge to the effect
that the wire service is also controlled out of Chicago ?
Mr. RosENBAUM. That seems to be the talk generally. I have no
actual proof, Mr. Halley, if that is what you want.
Mr. Halley. You have no actual proof of who owns the Saxony
either; do you?
Mr. RosENBAUM. Yes; I happen to know the owner, ]Mr. Sachs.
Mr. Halley. Have you seen the papers on the Saxony?
Mr. RosENBAUM. No, sir.
Mr. Halley. On the Robert Richter?
Mr. RosENBAUM. No, sir.
Mr. Halley. And on the Seaview?
Mr. RosENBAUM. No ; I haven't other than what you learn
Mr. Halley. From common knowledge?
Mr. RosENBAUM. Common knowledge : correct, sir.
Mr. Halley. It is common knowledge that Chicago interests con-
trol the wire service; isn't it?
Mr. RosENBAUM. Yes, sir; I would say "yes."
Mr. Halley. Do you sit there and say it is a fact that this wire
service, which is controlled out of Chicago, was suddenly turned with
no explanation, had nothing to do with your taking in Harry Russell?
Mr. RosENBAUM. No, sir.
Mr. Halley. There has been some testimony that Russell was
brought in to take care of baseball operations.
Mr. RosENBAUM. That was part of the deal when we negotiated
witli him.
Mr. Halley. You have never had any baseball operations; have
you?
Mr. RosENBAUM. Prior to that, we didn't have.
Mr. Halley. Did you have after that?
Mr. RosENBAUM. Yes, sir.
Mv. Halley. Nothing shows on your books. Can you account for
that?
Mr. RosENBAUM. That was in the concessionaires' accounts. In
other words, that was the same type of business.
Mr. Halley. How did Russell handle it?
Mr. Rosen BAU3I. He knew the fonnula of the baseball operation.
We weren't familiar with it.
ORGANIZED CRIME' IN INTERSTATE OOMMERCE 571
Mr. Halley. How much baseball business did you do ?
Mr. KosENBAUM. Offhand, I couldn't say, but we can check on it and
give you that.
Mr. Halley. How can you check? It doesn't show anywhere in
your books.
Mr. RosENBAUM. It was included in the horse activities.
Mr. Halley. You say it might have been included in the total in's ?
Mr. Rosenbaum. That is right.
Mr. Halley. How are you going to separate out the in's on the
basis of your books today ? They don't have one word in them about
baseball.
Mr. Rosenbaum. That is the way it was handled. It was included in
the horse records.
Mr. Halley. There is no way of showing there was any baseball
at all.
Mr. RosEXBAUM. There definitely was baseball activity.
Mr. Halley. But there is no way you can show it or show how much
of it there was in your own books, is there ?
Mr. RosENBAUM. I imagine it would be hard to do it because it was
included in the other activity.
Mr. Halley. It would be impossible if the word "baseball" no-
where appears in your books.
Mr. RosENBAUM. I am saying it was included in the regular horse
activities.
Mr. Halley. You couldn't go to your own books and show any evi-
dence whatsoever of baseball activity ?
Mr. RosENBAUM. With that breakdown, I don't think we could.
Mr. Halley. I have no other questions.
Senator Hunt (presiding). Senator Wiley ?
Senator Wiley. Have you any judgment what percentage of your
income came from what you call baseball ?
Mr. RosENBAUM. Not very much. Senator.
Senator Wiley. I have listened to. this story in which I think you
practically admitted that you and another one of your partners were
really the active heads there in managing that office. Is that right?
Mr. RosENBAUM. I would say we were there quite a little bit more
than others. I would put it that way. You may say that we were a
little more active on the inside.
Senator Wiley. You mean Friedman?
Mr. RosENBAUM. Yes, sir.
Senator Wiley. I want to be fair with you. Your lifeblood was cut
off when this telegraph business was discontinued, was it not?
Mr. RosENBAUM. Yes, sir.
Senator Wiley. Do you want to say that you didn't, as a matter of
jjust common sense, get busy and find out what it was all about?
Mr. RosENBAUM. When those things happen, they just happen; and
foil wait for the matter to be adjusted and resume your operation and
esume your service.
Senator Wiley. But you are no child. You would immediately get
nto action and try to adjust it; would you not? Isn't that what you
lid?
Mr. RosENBAUM. That w^ould be the natural thing to do.
Senator Wiley. Did you not do that ?
572 ORGANIZED CRIME'. IN INTERSTATE OOMME'RCE
Mr. RosENBAUM. We checked around
Senator Wiley. What do you mean by "checked around"?
Mr. RosENBAUM. I mean to find out. We were just cut off, and we
wanted to know why.
Senator Wiley. Whom did you check with and wliy ?
Mr. RosENBAUM. We probably checked with Mr. Byrnes.
Senator Wiley. Probably. What did Byrnes say ?
Mr. RosENBAUM. Offhand, I don't remember. Senator; just what
the answer was at that particular time.
Senator Wiley. Apparently whatever you did was effective, because
in the course of 2 weeks you got it back.
Mr. RosENBAUM. That is true; yes, sir. It was resumed.
Senator Wiley. During those 2 weeks, isn't it a fact that Russell
came in ?
Mr. RosENBAUM. I believe it was pretty nearly around that time,
sir.
Senator Wiley. Do you mean to tell this committee that your trans-
actions with Russell had nothing to do with getting the wire back?
Mr. Rosenbaum. The transaction with Russell was because of this
move to obtain some of the hotel concessions which he wanted.
Senator Wiley. Then, what caused you to get the wire back?
Mr. Rosenbaum. I don't know, Senator.
Senator Wiley, I repeat the question : Do you mean to say that at
this time you have no recollection as to what caused the wire to be
stopped and wdiat caused the wire to come on again ?
Mr. Rosenbaum. No ; I do not know, sir.
Senator Wiley, Do you think that sounds reasonable ?
Mr. Rosenbaum. That is the exact condition. I just don't know.
Senator Wiley. Is it a fact that the Chicago gang was trying to
"muscle in" on you ?
Mr. Rosenbaum. No, sir.
Senator Wiley, You don't say that very emphatically.
Mr, Rosenbaum. It is true. There was no "muscling" process that
I was familiar with.
Senator Wiley, Have you any reasonable explanation of this oc-
currence which cut off the very lif eblood of your business ? Have youJ
ever dreamed about what caused it or ever thought about what caused)
it?
Mr, Rosenbaum, I just don't know, sir.
Senator Wiley, No ; but I asked you. Have you done any thinking
about it ?
Mr, Rosenbaum. You kind of review it in your mind a little bity
I imagine.
Senator Wiley. That word "imagine" is a handy word at times, but
it doesn't give us any real basis here. Suppose the average business-
man were in business, and something like this occurred, and all at once
his business was stopped, you as a reasonable man must realize he
would want to know what stopped it. Did you not want to know what
stopped it?
Mr. Rosenbaum, True, It was just a case of the service being dis-
continued. There was nothing much we could do about it. We
waited out until it was resumed, Senator. There was no move we could
make to correct it until whatever the matters were they had to adjust
ORGANIZED CRIME: in INTERSTATE COMMERCE 573
were adjusted, and they could resume service. They were sellhig us
this service, and we just had to wait for them to service us.
Senator Wiley. How did you f^et to tlie point where you paid them
for the 2 weeks that they didn't service you? How did you arrive at
tliat decision ? Someone must have arrived at it.
Mr. RosENBAi'3i. I don't know just how that was arrived at. Prob-
ably we felt as though we were morally obligated for something re-
gardless of the fact that there was an upset for a limited time. That
is the only point I know on it.
Senator Wiley. How do you interject a moral responsibility in
tliere?
Mr. RosENBAUM. We have done business with the people.
Senator Wiley. I should think they would have paid you instead
of you paying them if they handed you a dig like that.
Mr. Rosenbaum. When you are doing business with people you
have a sort of rate proposition, and you feel as though you owe them
the contract price although there was nothing definite, I imagine.
You feel as though you are obligated.
Senator Wiley. As a matter of fact, you felt they had you by the
throat, and you had to pay whatever they said. Was that not it?
Mr. R,osexbaf:m. No. We argue the price, Senator, as far as the
charges were concerned.
Senator Wiley. Now we are getting down to something at last.
You argued. Who did you argue with ?
Mr. Rosenbaum. With Mr. Byrnes if he came along. We would
try to review the price situation. Friedman or Mr. Levitt and myself,
sometimes two, sometimes three, would be present.
Senator Wiley. That is all.
Senator Hunt. Mr. Levitt, would you give me the names of the
owners of the S. & G. in relation to their importance of ownership?
Would you name the one having the greatest interest first and on
down ?
Mr. Rosenbaum. In the partnership?
Senator Hunt. Yes.
Mr. Rosenbaum. It was an equal partnership, Senator.
Senator Hunt. You all five were equal ?
Mr. Rosenbaum. Equal partners ; yes, sir.
Senator Hunt. Would you give me their names?
Mr. Rosenbaum. Of the five partners ?
Senator Hunt. Yes.
Mr, Rosenbaum. Harold Salvey, Jules Levitt, Samuel Cohen,
Edward Rosenbaum.
Senator Hunt. How about this Mr. Friedman ?
Mr. Rosenbaum. Charles Friedman, I am sorry.
Senator Hunt. You want it to stand that it is your testimony that
only those five had an interest in the S. & G. Co. ?
Mr. Rosenbaum. Prior to Mr. Russell's coming in. There were six
after March
Senator Hunt. You understand that only those six had any interest ?
Mr. Rosenbaum. That is correct.
Senator Hunt. Did Mr. Cohen, your attorney, have any interest in
theS.&G.Co.?
Mr. Rosenbaum. Not to my knowledge, sir.
574 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Senator Hunt. At any time?
Mr. RosENBAUM. Not to my knowledfje.
Senator Hunt. Not to your knowledge.
Mr. RosENBAUM. No, sir.
Senator Hunt. You want to stand on that?
Mr. RosENBAUM. Definitely.
Senator Hunt. You know Mr. Friedman, of course, pretty well,
do you not?
Mr. RosENBAUM. Yes, sir.
Senator Hunt. What do you think of his ability or capacity as a
businessman?
Mr. RosENBAUM. He knows that particular type of business.
Senator Hunt. What do you think of his capacity to hold his own
ill a business conference?
Mr. RosENBAUM. He is fairly capable.
Senator Hunt. He must have been considered the most capable of
your group if you assigned this very important project to him to get
the wire service back. Would that be so ?
Ml-. RosENBAUM. The reason for that, Senator, was he was familiar
with the routine more than the others, I would say.
Senator Hunt. I see. Your company has been a ver^-, very success-
ful company. Mr. Friedman was one of the owners of the company.
Do you think he would not have the capacity to handle himself before
this committee?
Mr. RosENBAUM. As Mr. Cohen explained, I think it is a fear — I
don't believe he has had too much schooling and he can't express
himself very well, and there may be a lot of that in the back of his
crop, that he would look ridiculous.
Senator Hunt. He has done fairly well in business, though, has
he not ?
Mr. RosENBAUM. Yes, he has.
Senator Hun^t. Where did you live, Mr. Rosenbaum, before you
went to Miami?
Mr. RosENBAUM. I originated — mv home — I was born in Newark,
N.J.
Senator Hunt. Did you live there all of your life until you went
down to Miami ?
Mr. Rosenbaum. No, sir. I moved to Caldwell, N. J., a suburb
outside of Newark, approximately 10 miles, Caldwell.
Senator Hunt. Have you ever lived in Chicago?
Mr. Rosenbaum. No, sir.
Senator Hunt. Do you own any stock in a bank in New York City?
Mr. Rosenbaum. I do not. Senator.
Senator Hunt. Are you interested with Mr. Costello in a hotel in
New York City ?
Mr. Rosenbaum. No, sir.
Senator Hunt. Do you know Mr. Costello?
Mr. RosENBAi^M. I know of the gentleman. I don't know him
personally.
Senator Hunt. Do you have any interest in a distillery in Chicago?
Mr. Rosenbaum. No ; I do not. Senator.
Senator Hunt. Are you interested in cleaning and dying businesses,
a chain, throughout the Central States?
OIRGANIZED CRIME IN ESTTERSTATE COMJVIERCE 575
Mr. RosENBAUM. No. sir; I have no interest whatsoever.
Senator Hunt. Mr. Rosenbauni, I note here in yonr 1948 operating
statement for the year, in setting out your operating expenses you-
donated $.'>3,1'40 to charity. Would you name some of those charities
you donated this money to?
Mr. R.osENBx\uM. What year was that, Senator ?
Senator Hunt. 1948.
Mr. RosENBAUM. 1948. I believe we donated, just testing my mem-
ory, which may be fairly correct — Mount Sinai Hospital we had quite
a connnitment. We donated to the St. Francis Hospital, Miami
Beach. Mercy Catholic Hospital in Miami. I don't know whether
that was 1948 or not ; 1947 or 1948. Probably the Community Chest.
Red Cross, and Cardiac Home. I am just speaking from memory now.
Senator Hunt. Cancer Control, Boy Scouts and Girl Scouts.
Mr. RosENBAUM. Yes ; the cancer fund, blood bank or something or
other.
Senator Hunt. In making those donations were you buying the
editorial page, so to speak, you were purchasing good will of the com-
munity; is that a fact?
Mr. RosENBAUM. I wouldn't say that. Senator, in this respect. We
never sought any publicity on it. To prove the point, I believe we do-
nated $10,000 to the Jewish Appeal that year. They had a brochure
with the names of the donors printed, people who made donations, and
we were excluded. In fact, we had asked to be. We never made
public any of our donations to my knowledge. I believe you can
check on that, Senator.
Senator Hunt. Those donations were somewhat helpful, too, in your
income-tax reporting, no doubt, weren't they?
Mr. RosENBAUM. When you give that way, I imagine you are taking
a little advantage of it.
Senator Hunt. I notice you have legal fees of $8,400 in 1948. Do
jou remember who those legal fees were paid to? Were they all paid
to one man ?
Mr. RosENBAUM. Legal fees?
Senator Hunt. Legal fees.
Mr. RosENBAUM. In 1948?
Senator Hunt. Yes.
Mr. RosENBAUM. I really couldn't say offhand.
Senator Hunt. Who would know?
Mr. RosENBAUM. I imagine our books would show it.
Senator Hunt. Then I note that you had robberies to the extent of
$26,000. How d'd that liappen?
Mr. RosENBAUM. The Mercantile Bank had a night depository on
the lower floor of the Mercantile National Bank Building. The Mer-
cantile Bank is located on the second floor. The night depository was
on the lower level, on the first floor. As I remember the story, the
burglars broke through the wall and took all the bags that were
placed on night deposit, in this night depository. That is where we
sustained that loss.
Senator Hunt. May I have your version of why the S. & G. Syndi-
cate is being dissolved ?
Mr. RosENBAUM. Senator, we have had a world of unfavorable pub-
licity, as you know. A good many members, I say a good many, Mr.
576 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Friedman, Mr. Levitt, and Mr. Colien, have families, Jules Levitt has
two real fine boys going to college, Mr. Friedman has a nice family,
and as far as Mr. Salvey and I, we don't have children but the pub-
licity is quite distasteful and you get punched around a little bit and
you feel as though you have had your fill. This has been a sore spot
in my heart and I imagine it has been in the hearts of my associates.
We have been abused. The newspapers undoubtedly have taken un-
fair advantage of the situation as far as we are concerned. In other
words, we are all civic-minded men, have lived on the beach for
twenty-some-odd-years. I know I have been there 25 or 26 years and
the other members have been there 20 or better. We wei'e just branded
this and that, and I think very, very unfairly, and it got to the point
where we just feel as though that was the decision, that we wanted
to eliminate the S. & G., and we definitely decided to dissolve, and
as of the date mentioned we did dissolve.
Senator Hunt. One more question : The six associates and yourself
that you mentioned — are they financially so fixed now that for the rest
of their lives they need worry no further about income, money affairs?
Mr. RosENBAUM. I don't believe that is the case. I haven't checked
into their finances, but I know I will have to carry on.
Senator Hunt. What would you say about your own ?
Mr. RosENBAUM. I know I am going to look for a new line of en-
deavor with less headaches and publicity and notoriety.
Senator Hunt. I have no further questions.
The Chairman. Mr. Rosenbaum, in connection with your contribu-
tions I notice you made some rather substantial contributions to the
police and firemen's associations, and things of that sort.
Mr. RosENBAUM. Yes, sir.
The Chairman, April 18, and April 13, 1950, Justice of Peace and
Constables Association, $100 and another $100. West Miami Police
Association, $50 and another $50. Hialeah Police and Firemen's
Association, $100 and $50 and $50. Miami Police Benevolent Asso-
ciation, $200.
Is that just general contributions?
INIr. RosENBAUM. They usually have a program and approach you
and ask for an ad. It is customary.
The Chairman. I think this list Mr. Robinson compiled should be
in the record as an exhibit.
(Document referred to was marked "Exhibit No. 165," and appears
in the appendix on p. 788.)
Tlie Chairman. You did not have in mind being on the good side
of the police officials in making those contributions?
Mr. RosENBAUM. A lot of those police organizations are out of
town. Senator. It sort of answers itself.
The Chairman. Some of them are in town, are they not?
Mr. RosENBAUM. That is true.
The Chairman. And in Miami and Miami Beach?
Mr. RosENBAT'iNi. That is correct.
Mr. Cohen. We did no business in Miami.
The Chairman. But the sheriff's office is in Miami.
Mr. Cohen. That is not tlie sheriff's office.
The Chairman. Here is the Dade County Road Patrol Benevolent
Association, $100. What is tliat?
ORGANIZED CRIME: in INTERSTATE CX)MME'RCE 577
Mr. RosENBAUM. I believe tliey have a road patrol tliat patrols the
roads. Tliey have an affair every year, a money-raising campaign, a
sickness fund or something, and they ask for a donation for an ad.
That is what that was, I believe.
The Chairman. Here is one, South Miami Police and Firemen's
Association.
Mr. RosENBAUM. Along the very same lines. Senator.
The Chairman. Florida Peace Officers, $100. What is that?
Mr. RosENBAUM. Offhand I wouldn't know what the peace ofScers
association is.
The Chairman. Is there anything else?
I believe that is all, Mr. Rosenbaum.
Mr. Rosenbaum. Thank you, gentlemen.
The Chairman. Mr. Cohen, your brother Sam is here. What is
his situation?
Mr. Ben Cohen. He is at the hotel. He gave Mr. Halley a tele-
gram from the doctor. If you want him, we will bring him.
The Chairman. Is he ill?
Mr. Ben Cohen. Yes. He had two heart attacks within the past
week, and I think that telegram is self-explanatory. We didn't want
to flout the committee. I promised to bring him here. I will submit
him to you.
The Chairman. We do not need him now. I think I should read
this telegram into the record :
This telegram certifies Mr. Samuel Cohen following operation .July 10, 1950,
developed acute coronary insufficiency proven clinically and cardiographically.
For this reason, discharge from hospital postponed until July 27, 1950. In
my opinion undue excitement for a i^eriod of at least 3 months such as testi-
fying may cause repeated attack of acute coronary insufficiency and endanger
his life.
Elmer Milch, M. D.
We do not need him noAv, I think, and if some matter arises we may
call him later.
Mr. Cohen. He is waiting at the hotel.
The Chairjian. Your brother, Sam Cohen, and all other members
here today will be continued under subpena subject to further call of
the committee in case we need to interrogate them any further.
Mr. Cohen. Do you want us to stay in town ?
The Chairman. No, sir ; you do not need to stay in town, but if we
need you again, we don't want to have to serve another subpena.
Mr. Cohen. It won't be necessary, just call us.
The Chairman. Mr. Harold Salvey. Will you come around?
Mr. Salvey, do you solemnly swear the testimony you will give this
committee will be the whole truth and nothing but the truth so help
you God ?
Mr. Salx-ey. I do.
TESTIMONY OF HAROLD SALVEY, MIAMI BEACH, FLA., ACCOM-
PANIED BY BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
Mr. Halley. Wliat is your address, Mr. Salvey ?
Mr. Salvey. Miami Beach, Fla.
Mr. Halley. What is your business ?
Mr. Salvey. I am a financer of bookies.
578 ORGANIZED CRIMEI IN INTERSTATE OOMME'ROE
Mr. Hallet. You have been a bookie yourself, haven't you?
Mr. Salvet. That is right, sir.
Mr. Halley. Have you had any other business ?
Mr. Salvey. Have I had any other business at any time at all ?
Mr. Halley. Say in the last 20 years.
Mr. Salvey. Twenty years. Yes. I conducted a club in Detroit,
Mich. It was for employees of a labor union. I ran that until I left
there approximately 23 or 24 years ago.
Mr. Halley. What have you done in Miami since?
Mr. Salvey. I have done some bookmaking there.
Mr. Halley. Nothing but bookmaking ?
Mr. Salvey. That is right.
Mr. Halley. You have also had participation in various gambling
clubs?
Mr. Salvey. Not various, one.
Mr. Halley. What was it ?
Mr. Salvey. Sunny Isles Club.
Mr. Halley. You have been a participant in that ?
Mr. Salvet. That is true.
Mr. Halley. You have been arrested on occasion for bookmaking?
Mr. Salvey. I was arrested in 1939 but never convicted.
Mr. HalIuEY. In fact, your case never came to trial, is that right?
Mr. Salvey. It never came to trial.
Mr. Hallet. You were arrested three times, I believe.
Mr. Salvey. Well, I was arrested once. A little while later, I think
it was 1945, 1 was cited for being a participant in a gambling institu-
tion, but it never came up, I don't think.
Mr. Halley. So in each case you beat the rap ?
Mr. Salvey. Not that I beat the rap.
Mr. Halley. You weren't convicted.
Mr. Salvet . I wasn't convicted, that is right, sir.
Mr, Halley. You have been a bookmaker and that is your occu-
pation ?
Mr. Salvey. That is right.
Mr. Halley. I would call that beating the rap.
Mr. Salvey. Have it as you will.
Mr. Halley. Where were you when the committee was trying to
serve subpenas in Miami a month ago ?
Mr. Salvey. Miami is a tropical climate and that was vacation time.
Mr. Halley. When the committee came that was vacation time ?
Mr. Salvey. Not necessarily. Every year I go away about that time.
Mr. Halley. Where did you go ?
Mr. Salvey. I went to New York.
Mr. Halley. You were in New York at the time ?
Mr. Salvey. Traveling around, yes, sir.
Mr. Halley. When did you leave Miami ?
Mr. Salvey. I must have left Miami maybe a week prior to that.
Mr. Halley. When did you return to Miami ?
Mr. Salvey. I think I was gone about 2 weeks in all.
Mr. Halley. So your vacation, like that of the other members of
the S. & G. Syndicate, was very accurately timed to be just before and
after the committee hearinjjs.
ORGANIZED CRIME! IN ESTTERSTATE OOMMERCE 579
Mr. Salvey. You can put it that way if you will, but every year I
go away for a couple weeks and come back and then I go away for
another 2 weeks. It is summertime down there.
Mr. Hallet. That is right, this year you went when the committee
started serving subpenaes in Miami ; is that right?
Mr. Salvey. I Avent prior to that.
Mr. Halley. There was an announcement made in the newspapers
that there were going to be hearings about a week before the hearings
were held.
Mr. Salvey. When the committee was there the first time I was
in town all the time that the investigation was on. I was there.
Mr. Halley. I know, there was no announcement the first time the
committee appeared in Miami and the investigation was on and over
I)r;ictically before it got into the newspapers.
Mr. Salvey. You were there two full days, and I had no intention
of leaving then and I had no knowledge of how long you would be
there, sir.
Mr. Halley. You weren't available; is that right?
Mr. Salvey. I was on vacation, sir.
Mr. Halley. You were advised that the committee was looking
for you, were you not?
Mr. Salvey. No, sir. When I was told
Mr. Halley. Don't you read the newspapers?
Mr. Sal\^y. I wasn't down there to i-ead the newspapers.
Mr. Halley. It appeared in the New York papers, too.
Mr. Salvey. I did not see it.
Mr. Halley. Didn't your friends and family let you know that it
was all over the papers in Florida and on the radio?
Mr. Salvey. No, sir. When I found out there was a subpena for
nie — in fact, the subpena was never handed to me. I had a call one
day, I was registered under my own name at the hotel in Miami where
I live, one day I received a call, and I think Mr. Mills, your investi-
gator, was up there and gave a subpena to Mr. Cohen
Mr. Halley. You mean the last week?
Mr. Sal\ty. Yes; Mr. Cohen called me and said I have a subpena
and I said accept it. Mr. Mills got on the phone and said, "Are you
Mr. Harold Salvey," and I said "Yes," and he said, "Will you accept
this subpena," and I said "Yes."
Mr. Halley. Look, ]\Tr. Salvey, the committee arrived in Miami
about a moath ago to have hearings. There was an announcement in
tlie. newspapers and quite mysteriously every member of the S. & G.
Avent to thi- hospital, went to visit a sick relative, or went on vacation.
It was widely advertised in the press and on the radio that the com-
mittee was looking for you as well as the others. Did you at any
time, wheii we, the committee, made arrangements at great length
with your counsel, make any attempt to get in touch with this com-
mittee and say, "I am available"?
Mr. Salvey. When I got back in town, Mr. Halley, I understood
that Mr. CDhen, Mr. Ben Cohen here, had talked to Mr. Kefauver ancl
told him ci* told you, I am not sure, that if you ever wanted any of
us, he won d produce us right then.
Mr. Halley. Didn't you think you had a responsibility to get in
touch with he committee and say you were available ?
580 ORGANIZED CRIME! EST INTERSTATE COMMERCE
Mr. Salvet. After ^A^hat Mr. Cohen told me
Mr. Halley. What he said was he would try to, but he certainly i
couldn't control you, and if he couldn't find you, he couldn't find you. j
Mr. Salvey. He didn't put it to me that way.
Mr. Haleey. That is the way he put it to Senator Kefauver in my
presence.
Mr. Salvey. He said he would produce us up here, and I said I was
ready any time.
Mr. Halley. In any event, you are here now.
Mr. Salvey. Yes, sir.
Mr. Halley. You have heard the testimony of Mr. Cohen, is that
right ?
Mr. Salvey. Yes, sir.
Mr. Halley. Have you any corrections or additions you would like
to make to it ?
Mr. Salvey. Not right now, sir.
Mr. Halley. By not right now, do you mean you might have correc-
tions later ?
Mr. Salvey. There is none that I can think of.
Mr, Halley. Did you hear anything that Mr. Cohen said that you
thought wasn't right or accurate ?
Mr. Salvey. No, sir.
Mr. Halley. Did you hear the testimony of the other witnesses ?
Mr. Salvey. Yes, sir.
Mr. Halley. Is there anything you would be able to tell the com-
mittee which would correct or add to their testimony ?
Mr. Salvey. I can't think of anything at this moment ; no, sir.
Mr. Halley. What was your participation in S. & G? There has
been testimony that you do nothing.
Mr. Salvey. When Jules Levitt, Charles Friedman, and myself
first entered into this business back in I think around 1939, we oper-
ated along the same lines. Several years later, I understand it was
in September of 1944, Mr. Sam Cohen, who was in the same business,
and Mr. Eddie Rosenbaum, who was in the same business, decided that
it would be better if we all got together, that we could save a little
expenses here and there. We did join up and formed at that time what
was previously known up until a short time ago as the S. & G. Service.
Mr. Halley. Do you know how it got its name?
Mr. Salvey. No, sir ; I don't,
Mr. Halley. Go ahead.
Mr, Salvey, When we formed the S. & G., I told the fellows that
I wasn't very well, and I would like to quit. They told me there is no
use in your quitting, you have been with this thing a long time, the
same as any official who has been with a big company. If he has been
with them, they continue with them right on, especially if his services
aren't needed,
Mr, Halley, When did this occur ?
Mr, Salvey. It might have occurred in 1945 or so. I don't
remember.
Mr. Halley. You just started the syndicate in 1944, you hadn't
been with a big firm so many years.
Mr, Salahcy. We had been there since 1939.
ORGANIZED CRIME: IN INTERSTATE OOMMETICE 581
Mr. Halley, Tlie Syndicate was formed in 19-44. That is the
testimony of Mr. Ben Cohen, sitting right next to you.
Mr. Salvey. The S. & G. Service was formed in 1944, it is true,
but for me it was just a continuation of wliat I had been doing. The
only thing we did was take in two more partners.
Mr. Halley. You had not been doing it as a group together.
Mr. Salvey. Yes ; we liad, as a group.
Mr. Halley. You liad been making book yourself?
Mr. Salvey. No. We liad these concessionaires calling in on the
same pi-inciples and we continued as such down through the years.
Mr. Halley. But you had not been together as a group. You had
been ojierating separately.
Mr. Salvey. No, sir.
Mr. Halley. Who are your three?
Mr. Salvey. Jules Levitt, Charles Friedman, and myself.
Mr. Halley. You three had been together?
Mr. Salvey. Yes, sir.
Mr. Halley. You took in two more members in 1944?
Mr. Salvey. All we did was add two more.
]Mr. Halley. One year later you quit ?
Mr. Salvey. I don't say it was 1 year, approximately. I am not
quite sure. I didn't quit; no, sir.
Mr. Halley. You didn't quit receiving your money, but you quit
doing anything.
Mr. Salvey. Well, doing anything. Some fellows work on the out-
side, lilce you heard Mr. Hosenbaum say he worked on the inside.
Mr. Halley. Where did you work?
Mr. Salvey. I didn't do any work.
Mr. Halley. You were pretty friendly with Burbridge, weren't you ?
Mr. Salvey. jNIr. Burljridge is a goocl friend of mine. I have great
admiration for Mr. Burbridge.
Mr. Halley. He has expressed an admiration for you.
Mr. Salvey. I have reason to admire Mr. Burbridge.
Mr. Halley. You have been friends for many, many years; is that
right?
Mr. Salvey. I can explain that. A good many years ago when Mr.
Burbridge was located in Duval County, which is Jacksonville, he
fought the Ku Klux Klan strenuously. He was one of the greatest
fighters of the Ku Klux Klan in Florida. I, being Jewish, admired
him for it. When he came to Miami Beach, I continued to admire him
because Mr. Burbridge was well known in the State of Florida. At
the age of 24 he Avas made Dade County commissioner and has con-
tinued in politics since.
Mr. Halley. He has become quite a power in Miami Beach; isn't
that right?
Mr. Salvey. I don't know whether you call it a power. He is one
of the seven councilmen of the city of Miami Beach.
Mr. Halley. There was considerable testimony here this morning
by your colleagues that he was one of the most influential, if not the
tnost influential, members of the Miami Beach City Council. Do you
agree with that ?
Mr. Salvey. Mr. Halley, they all have the same voice.
582 OR'GANIZE'D CRIME! m INTERSTATE COMMERCE
Mr. Halley. I know, but he apparently is more persuasive. He
takes leadership. That has been the testimony.
Mr. Salvey. I don't know about that, Mr. Halley.
Mr. Halley. You would doubt it?
Mr. Salvey. I wouldn't doubt it, no. I would say that each man
has a vote, and no one man's vote counts more than the other.
Mr. Halley. But the others seem to listen to Burbridge.
Mr. Salvey. No. I have seen where they have gone 4 to 3 against
him.
Mr. Halley. That hasn't happened often in connection with
matters
Mr. Salvey. Yes ; it has, sir.
Mr. Halley. Has it happened in connection with matters S. & G.
cared about?
Mr. SAL^'EY. I don't think he is interested in matters of S. & G.
Mr. Halley. For instance, the appointment of a city manager or
a police commissioner.
Mr. Salvey. The city manager of Miami Beach has been in office
for 24 years, considered in the line of the city manager government in
the United States, probably the best in America.
Mr. Halley. Who so considers him?
Mr. SAL^^Y. If you will call up any city that has city management,
they know Mr. Renshaw, Claude Renshaw.
Mr. Halley. Have you heard the testimony not only here today but
have you read the testimony that the chief of police of Miami Beach
testified that he called a common ordinary detective on the police
force to take full responsibility for gambling, he didn't want to know
anything about it ?
Mr. Salvey. That who did that?
Mr. Halley. Phil Short, when he was chief of police told that to
Perdue.
Mr. SAL^^Y. What he told to Perdue has no bearing
Mr. Halley, It was common knowledge in Miami Beach that he
told that to Perdue. Perdue became known as the one-man vice
squad or gambling squad.
Mr. Salvey. So I have heard, so I have read.
Mr. Halley. Short wouldn't even listen to anything about gambling.
Isn't that right?
Mr. Salvey. Mr. Short when he was chief of police had his duty
to perform. I don't know anything about what he was supposed to
have done.
Mr. Halley. I am trying to find out from you what kind of city
manager is Renshaw with that condition going on under him, where
his chief of police didn't want to have anything to do with gambling.
How can you sit there and testify that Renshaw did a good job as
city manager?
Mr. Salvey. I say if you look up the record of the city of Miami
Beach, it is in better shape financially than any city of its size.
Mr. Halley. It happens to be the center of the greatest wealth in
the country.
Mr. Salvey. He is responsible for having it that way.
Mr. Halley. I won't argue that point with you.
Mr. Salvey. It is a matter of common knowledge, Mr. Halley.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 583
Mr. Halley. Nonsense. Let's ^et on with your financial transac-
tions with this man Biirl)rid<?e. What were they ?
Mr. Salvey. Mr. Biirbridfre and I at the present time own a lot
together. I would like to go back to the origination of that. Years
ago there was a vacant lot that was zoned for residential on what is
now one of the busiest streets in ]\Iiami Beach, a place called Wash-
ington Avenue. ]Mr. Burbridge purchased that lot with a man known
as William Maher.
Mr. Halley. He was one of the S. & G. original partners?
Mr. Salvey. Years ago; yes, sir.
Mr. HaLley. And also a partner in Sunny Isles?
Mr. Sal\T!;y. Years ago; yes.
Mr. Halley. He was doing business with Burbridge in this real-
estate deal, is that right?
Mr. Salvey. He purchased a half interest in a lot and Mr. Bur-
bridge had the other half interest.
Mr. Halley. Together?
Mr. Salvey. They owned it jointly ; yes, sir.
Mr. Halley. Mi-. Maher Avas also at that time one of your partners
in the S. & G. and Sunny Isles, is that ri^ht?
Mr. Salvey. He was a partner of ours in both places. If it was
when he bought the lot I am not positive.
Mr. Halley. We will ^et to that. What happened then?
Mr. Sal\-ey. Mr. Burbridge and Mr. Maher had foresight to know
that that particular street, Washington Avenue, could not be zoned
for residential area for any length of time. They knew eventually it
would have to be rezoned for business property, the same as other
property has been down there. When they bought it they bought it
very reasonable, the same as a lot of property has been purchased
down there.
]\rr. Halley. In fact, they each put in $7,500 ?
Mr. Salary. So I understand. After it was rezoned, I purchased
William Maher's interest for $25,000.
The Chairman. Was it rezoned by the city council?
Mr. Salvey. By the city council ; yes, sir.
The Chairman. Of which he was member ?
Mr. Sal\-ey. Of which he w^as a member. It takes five men to
rezone.
Mr. Halley. In what year did you purchase Maher's interest ?
Mr. Salary. A few years ago, I don't know exactly.
Mr. Halley. At the time it was rezoned ?
Mr. Sal\t:y. After it was rezoned; yes, sir. After I had the lot a
while I decided to build on it. I made a deal with Mr. Burbridge
whereas I paid him for a 99-year ground lease $6,000 a year.
Mr. Halley. Burbridge got a considerably better deal than Maher,
did he not?
Mr. Salat:y. How did he get a better deal ?
Mr. Halley. Maher got $25,000.
Mr. Salvey. Maher got $25,000 a few years ago, a short time prior to
that. The land became more valuable as they started building on
Washington Avenue. Different business houses went up and it in-
creased the value of Washington xl venue.
68958—50 — pt. 1 38
584 ORGANIZED CRIME' IN INTERSTATE COMIVIERCE
Mr. Halley. Burbridge was getting at $6,000 a year a price that
probably was three or four times as much as Maher was getting.
Mr. Salvey. All Maher did was purchase the property and then
sell it.
Mr. Halley. What did Burbridge do, purchase it and lease it?
Mr. Salvey. Which is one of the things that is done more on Miami
Beach than the purchase of land, a 91)-year lease. That is done
extensively down there. In fact, the deal must have been all right
because when I went to the Mercantile National Bank, one of the
largest banks in Florida, I asked them for a construction loan on the
building I intended to put up there. They said they sent their attor-
neys there to look that deal over. They examined the abstracts.
They knew about the subordination that Mr. Burbridge had given me
after I made the deal with him for the 99-year lease at $0,000 a year.
They thought well enough of that proposition, and you know how
tough banks are.
Mr. Halley. S. & G.'s business is with Mercantile Bank?
Mr. Salvey. I beg your pardon, they do not.
Mr. Halley. We just had testimony
Mv. Salvey. They may do some of it, but most of it was done with
another bank.
Mr. Halley. They do some of it, do they not ?
Mr. Salvey. The lesser part of their banking is done with S. & G.
Mr. Halley. You have a very substantial outlet. You are a very
important businessman in Miami Beach, aren't you?
Mr. Salvey. Outside of the S. & G. service, the only thing I own
there, the only business I do is right there in that building that we are
talking about now.
Mr. Halley. You are worth over $300,000, are you not?
Mr. Salvey. Maybe.
Mr. Halley. Why wouldn't the bank give you a loan?
Mr. Salvey. They only give you a mortgage on something that you
possess. They don't know what mortgages I had on the other stuff
there. They have no way of knowing.
Mr. Halley. Mr. Salvey, isn't it a fact that on this land for which
you paid $25,000 from Mr. Maher, you paid $6,000 a year for 99 years
to Burbridge?
Mr. Salvey. Yes.
The Chairman. And you pay the taxes?
Mr. Salvey. I pay the taxes ; yes, sir.
The CiiAiRMAX. So Burbridge is out nothing.
Mr. Salvey. That is the way 99-year leases are made in Florida.
Mr. Halley. The amount of rent varies.
Mr. Salvey. The amounts vary. I am trying to bring out it must
have been a fair proposition if the bank was willing to give me this
consti'uction loan.
Mr. Halley. That is an absurd statement on its face.
Mv. Salvey. I don't think so, INIr. Halley.
Mr. Halley. The bank is perfectly willing for you to pay any rent
you wanted provided you had the assets to ])ay it.
Mr. Salvey. Here is what happened since then. I prove that my
other properties have no bearing on this building. Since I con-
structed this building I have taken mortgages out on other land, and
ORGANIZED CRIME IN" INTERSTATE OOMME'RCE 585
my other land has been mortgaged. Every bit of it is mortgaged.
The only thing they have is this particular land and building, the
bank I am talking about, the Mercantile National Bank.
Mr. Halley. What other business transactions have you had with
Burbridge ?
Mr. Salvey. Business transactions? Well, sometimes there was
some land — I think that Mr. Burbridge knows real-estate dealings
there. I would go to him and ask him what would be a good thing to
buy. I did that because he has been in that business all his life. From
his knowledge he would tell me "I think this is all right." I would say
"See if you can get it for me." Through him I would buy some land.
Mr. Halley. You paid him a commission ?
Mr. Salvey. No, sir. It is the seller that pays the commission, not
the buyer.
Mr. Halley. He got the commission out of the deal ?
Mr. Salvey. That I don't know.
Mr. Halley. He has testified that he got commissions on deals he
handled for you.
Mr. Salvey. If he testified, then he must have received it from the
party who sold it.
Mr, Halley. And of course you paid the purchase price to the seller,
is that right ?
Mr. Salvey. That is right.
Mr. Halley. Did you ever borrow $40,000 from Burbridge?
Mr. Salntey. Yes, sir ; I borrowed $40,000 from ]SIr. Burbridge.
Mr. Halley. You kept it a month or two, is that right ?
Mr. Salvey. I kept it a while and paid him interest on it. I paid
him $2,000 for the loan.
Mr. Halley. The rate was 10 percent a j^ear, I believe.
Mr. Salvey. I also have some loans now that I pay 10 percent on.
Not from him, though. From some other people.
Mr. Halley. Real-estate loans ?
Mr. Salvey. Real-estate loans.
Mr. Halley. What do they aggregate ?
Mr. Salvey. I took a $50,000 loan on some stuff I had on Forty-
first Street. I took a $50,000 loan on some stuff that I have on the
ocean front.
Mr. Halley. Are these mortgage loans?
Mr. Sal\'ey. Mortgage loans ; yes, sir.
Mr. Halley. And your testimony is you are paying 10-percent inter-
est on mortgage loans ?
Mr. Salvey. I am paying 10-percent interest per year.
Mr. Halley. On mortgage loans ?
Mr. SAL^^:Y. Yes, sir.
Mr. Cohen. On unimproved property they get that, Mr. Halley.
Mr. Halley. In any event, you ])ay Burbridge 10 percent on a
$40,000 loan for about 3 months, I believe.
Mr. Sal\^y. I didn't pay him at the rate of 10 percent; no, sir.
Mr. Halley. You jjaid him a larger percent ?
Mr. Salvey. No, sir.
Mr. Halley. He got $2,000 interest.
Mr. Salvey. He got $2,000.
Mr. Halley. For 3 months ?
586 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. Salvey. Three months.
Mr. Halley. The annual rate would be what?
Mr. Salvey. On $40,000 it would be $4,000.
Mr. Halley. So 10 percent would be $4,000 a year.
Mr. Salvey. That is right.
Mr. Halley. Two percent for 3 months would be $8,000 a year. So
you were paying 20 percent.
Mr. Sal'^t:y. Not necessarily. I will prove that to you. Just listen
to this, Mr. Halley : The loans I had, take the loan I have on Forty-
first Street, Major Edelman right here in Baltimore made the loan
to me. It is 10 percent per year. If I want to pick that up in 2
months or so, I have to pay him $5,000. I get no reduction whatso-
ever. I have to pay the full year's interest on that loan.
Mr. Halley. Mr. Burbridge also testified that several years ago
j'ou sent him from California a check for $1,000, a cashier's check. He
said he hasn't been able to figure out what that was for. Maybe you
can explain that one, too.
Mr. Salvey. At that time it was either charity or a loan, I don't
remember. But I tell you what I did. I went to the bank and told
them I wanted to buy a cashier's check. I told them who I was. I
said my name is Harold Salvey. 1 want this check made out to
AVilliam Burbridge. I in turn sent that check back to Miami Beach
from California and Mr. Burbridge in turn deposited it to his account
and endorsed his name to that check.
Mr. Halley. You don't know what the payment was for at all ?
Mr. Salvey. At the moment I don't remember. That was several
years ago.
JNIr. Halley. Have you also purchased various parcels of real estate
from Burbridge?
Mr. Salvey. Yes. We went into that a minute ago, Mr. Halley.
Yes, sir,
Mr. Halley. He has made a profit on that, I take it.
J\Ir. Salvey. Anyone who sells real estate down there makes the
natural commission, but not from me. The buyer doesn't pay a com-
mission.
]Mr. Halley. He testified I think that he sold you some.
Mv. Salvey. No, sir.
Mr. Halley. That you were the buyer.
Mr. Salvey. No, sir. I never — I was the buyer but! paid no com-
mission. I misunderstood you for a moment. I thought you meant
I bought something from him. I never bought anything from Mr.
Burbi'idge, to my knowledge.
Mr. Halley. Just in transactions where he acted as the broker?
Air. Salvey. In transactions.
JNIr. Halley. And he made the commission.
Mr. Salvey. I presume.
Mr. Halley. What other transactions have you had with Bur-
bridge ?
Mr. Salvey. None that I know of, unless one time there — I may
have borrowed some money from him. I don't remember right now.
If I did, I paid him back. Anything Mr. Burbridge ever loaned me,
he gave me a check for, his own ])ersonal check.
Mr. Halley. Whenever you boi'rowed money from Burbridge, did
you ])ay him interest?
ORGANIZED CRIME' IN INTERSTATE COMMERCE 587
Mr. Salvey. Interest? I presume I did. Sometimes it was a small
amount like a thousand and he wouldn't charge me anything for it.
Mr. Halley. Have you any records of small loans like a thousand
dollars ?
Mr. Salvey. "VMiatever it is, the checks will show it.
Mr. Halley. But you did borrow substantial sums and pay interest,
is that right ?
Mr. Sal\i:y. Just what we spoke about.
Mr. Halley. The $40,000?
Mr. Salvey. The $40,000.
Mr. Halley. Nothing else?
Mr. Salvey. Not that I can remember at the moment.
Mr. Halley. 1 have no other questions at the moment.
Senator Hunt. I have no questions.
The Chairman. Did you know about this yacht deal that the S. & G.
got into?
Mr. Salvey. Senator, I knew nothing about it.
The Chairman. Until after it had been bought ?
Mr. Salvey. Later on, later oil
The Chairman. They didn't consult you about it at all?
Mr. Sal\'ey. No, sir ; they did not.
The Chairman. Did you enter into the negotiations about the wire
service ?
Mr. Salvey. I knew nothing about the wire service, I hadn't been
active in the S. & G. service.
The Chairman. Did you know Mr. Russell ?
Mr. Sal\ty. I never knew Mr. Russell, no.
The Chairman. "Were you consulted about taking him in as a part-
ner?
Mr. Salvey. Well, they came to me around the time that it was
talked about here and said we have a fellow here who is a pretty good
man on baseball. I said whatever you do is all right wdth me. It
shouldn't be any different now.
Mr. Halley. So you just acquiesced in it.
Mr. Salvey. That is right.
Mr. Halley. Who is Charles Lebanon ?
Mr. Salvey. Charles Lebanon? Charles Lebanon was a conces-
sionaire.
Mr. Halley. Where?
Mr. Salvey. At one time he was a concessionaire at the Lord Tarlton
Hotel.
Mr. Halley. Was he ever concessionaire at the Roney Plaza?
Mr. Salvey. Yes, sir. I will explain that to you. Several years
ago Charles Lebanon came to me. He was a friend of mine. He
came to me. He knew I was in that business. He said, "Harold, if
I could get that Roney Plaza concession," and I said to him, "They
have never had any bookmaking there, Charlie." That is one hotel —
pretty nearly all of them do have it and I said "That is one hotel that
doesn't have it." 'Will you come with me," he said, "and maybe we
can work out something." Being a friend of his I said I would go.
So we went up there. We spoke to them and they said all right, go
ahead.
Mr. Halley. To whom did you speak?
588 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Salvet. I think I spoke to the auditor there.
Mr. Halley. What is his name ?
Mr. Salvey. I don't know his name.
Mr. Halley. Meyer Schine had just bought the Koney Plaza ?
Mr. Salvey. That is right, just after that.
Mr. Halley. Did you sj^eak to Schine ?
Mr. Sal\'ey. Schine came down there later. He came into the
picture later.
Mr. Halley. Let's get it chronologically. What happened first?
You went down and spoke to the auditor?
Mr. Salvey. Yes.
Mr. Halley. Wliat is his name ?
Mr. Sal\t:y. I don't remember his name. This is a few years ago.
Mr. Halley. What happened at that time ?
Mr. Salvey. He said when Mr. Schine comes in here, we will talk
about it. Schine came in, and you know how they talk, they want you
to run a nice clean place, and Lebanon guaranteed him he would.
Finally Lebanon took the place over and after he had been there a very
short time Mr. Schine came to him and said "This won't do. You are
making book here."
Mr. Halley. Wasn't it understood from the first that is what the
purpose was ?
Mr. Salvey. I presumed it was understood from the start.
Mr. Halley. That is what you were talking about with the auditor
and with Schine, wasn't it?
Mr. Salvey. We talked about booking, yes. I thought it was under-
stood that way.
Mr. Halley. You were known as a bookmaker, were you not ?
Mr. Salvey. Definitely, yes, sir.
Mr. Halley. You knew Mr. Schine?
Mr. Salvey, No, I had never seen Mr. Schine prior to that.
Mr. Halley. When you went to see him then you had to describe
what your activities were, isn't that right ?
Mr. Salvey. That is right, sir.
Mr. Halley. You said you wanted to operate a book at the Roney
Plaza, didn't you ?
Mr. Salvey. That is right.
Mr. Halley. He agreed to it, is that right ?
Mr. SAL^^•:Y. He took the money, the auditor did.
Mr. Halley. The rent was fixed at $7,500 a year ?
Mr. Salvey. I think so. I am not sure.
Mr. Halley. Who made that deal for the rent?
Mr. Salvey. Charlie Lebanon and myself were right there.
Mr. Halley. With whom did you make the deal on the amount of
rent to be paid ?
Mr. Sal\t:y. Mr. Schine, I think.
Mr. Halley. What do you mean, you think ?
Mr. Sal%tey, I don't know whether it was with him or with the
auditor, because I remember distinctly Mr. Schine saying to me, "You
will have to take that up with the auditor."
Mr. Halley. Have to take what up?
Mr. Salvey. The deal.
Mr. Halley. You mean the details?
ORGANIZED CRIME: in INTERSTATE COMMERCE 589
Mr. Salvfa'. The details.
Mr. Halley. But did you discuss the financial arrangements with
Mr. Schine?
Mr. Sao'ey. Yes, sir.
IVIr. Halley. You did?
Mr. Salvey. I am pretty sure; yes, sir.
Mr. Halley. How long did you and Lebanon operate there?
Mr. Salvey. Mv. Lebanon operated there. He was the concession-
aii'e there for a very short time.
Mv. Halley. Your lease was made out to both you and Lebanon, is
that right ?
Mr. Salvey. Charlie wanted it that way, yes. He was the conces-
sionaire there.
Mr. Halley. You were represented by counsel, were you not?
Mr. Salvey. I wasn't ; no, sir. Charlie had somebody there. I
don't even know the fellow's name, some lawyer he had.
Mr. Halley. Wasn't Louis Kutner the counsel?
Mr. Salvey. I have no idea what his name was.
Mr. Halley. He happens to be the same man who Harry Russell
went to see in Chicago.
Mr. Salvey. That I wouldn't know.
]\Ir. Halley. Have you ever met or heard of Louis Kutner?
Mr. Salvey. I must have seen him there at the time, that is the only
thing I know about him.
Mr. Halley. Lebanon had brought him in?
Mr. Salvey. Positively.
Mr. Halley. This lease was drawn and you signed it?
Mr. Salvey. As far as my knowledge, yes.
Mr. Halley. And began to make book at the Roney Plaza.
Mr. Salvey. Yes, sir.
Mr. Halley. Did that occur in 1944 right after the lease was signed?
Mr. Salvey. If that is the year. I don't remember. It was a few
years ago.
Mr. Halley. I will show you a copy of a lease and ask you if this
is the Roney Plaza lease.
Mr. Salvey. January 1944. That is when it must have been. That
was before the S. & G., Mr. Halley. It was formed in September that
year.
Mr. Halley. How long did the operation last at the Roney Plaza?
Mr, Salvey. Maybe a week and a half or two,
Mr. Halley. Is that all ?
Mr. Salvey, I presume. That is about all as far as my knowledge
is concerned,
Mr. Hau.ey. Then what happened? Did Schine speak to you
personally ?
Mr. Salvey. Before they could even do anything there, Schine had a
change of heart. He didn't say anything to me because I didn't
operate it. It was Mr. Lebanon operated it.
Mr. Halley. Were you a partner of Lebanon in the deal ?
Mr. Sal\t:y. He was the bookie then, the concessionaire.
Mr. Halley. Were you operating on a 50-50 basis with him ?
Mr. Salvey, Yes, sir: 50-50 basis.
590 ORGANIZED CRIME! IN INTERSTATE CX)MMERCE
Mr. Halley. Schine told Lebanon, as yon nnderstand it, to get out?
Mr. Salvey. After he was there maybe 10 days, Schine said no go,
out. He gave the money back.
Mr. ILvLLEY. Did he in fact get out ?
Mr. Salvey. Absohitely he got out.
Mr. Halley. Dui-ing 1*949 you were still a participant in the Sunny
Isles, were you not?
Mr. Salvey. In 1949?
Mr. Halley. Yes.
Mr. SAL^'EY. Yes, sir.
Mr. Halley. Do you know John Rush, an attorney?
Mr. Salvey. No, sir.
Mr. Halley. He has his offices in Jacksonville.
Mr. Salvey. I have heard of the gentleman.
Mr. Halley. You have heard of him ?
Mr. Salvey. Yes, sir.
Mr. Halley. You know that he represented the S. & G. Syndicate
in 1949 in connection with a proposed bill to legalize gambling?
Mr. Salvey. I heard of it ; yes, sir.
Mr. Halley. Had you heard that S. & G. paid him a fee of $10,000?
Mr. Salvey. I heard it later ; yes, sir.
Mr. Halley. Had you heard that Sunny Isles also, in 1949, retained
Eush?
Mr. Sal\^y. I didn't know that, sir.
Mr. Halley. And paid him a fee ?
Mr. Salvey. I didn't know that.
Mr. Halley. Have you heard of it since ?
Mr. Sala'ey. I heard it today up here.
Mr. Halley. Where did you hear it today ?
Mr. Salvey. I heard it mentioned here.
Mr. Halley. When?
Mr. Salvey. Some one of the witnesses testified.
Mr. Halley. Tliere was no testimony about that.
Mr. Salvey. I think there was.
Mr. Halley. Had you heard it any place else?
Mr. Salvey. I may have. I am not sure.
Mr. Halley. Have you any knowledge?
Mr. Salaey. I have heard the name Rush. I kept hearing it back
there. Somebody mentioned Rush.
Mr. Halley. Have you any knowledge of the circumstances under
which Sunny Isles in 1949 retained Rush as counsel?
Mr. Salvey. No, sir.
The Cpiairman. If you did not employ Mr. Rush on behalf of
Sunny Isles, who would have ?
Mr. Salvey. Wlioever the partners were there. There were sev-
eral. I had a minority interest in Sunny Isles.
The Chairman. Any questions?
I think that is all, thank you.
Mr. Salvey. Thank you. Senator.
The Chairman. Mr. Rosenbaum, will you come back for just onei
question ?
ORGANIZED CRIME; IN INTERSTATE COMMERCE 591
FURTHER TESTIMONY OF EDWARD ROSENBAUM, MIAMI, FLA.,
ACCOMPANIED BY BEN COHEN, ATTORNEY, MIAMI BEACH, FLA.
The Chairman. I think our record is fairly clear about this, but I
wanted to make it absohitely clear, if you know, where S. & G. o:ot its
wire service from at different times prior to 1948 ; where did you get
your wire service from?
Mr. KosENBAUM. It was always local. Senator, in that area, Dade
County area.
The Chairman. Was that the Dade County News Service, whatever
the outfit was in Miami ?
Mr. KosENRAuivr. I believe so, Dade County News.
The Chairman. Do you know where they got their wire service
from ?
Mr. RosENKAUM. I have no knowledge of that, sir.
The Chairman. You don't know wdiether it was Continental or
whether it was gotten in from New Orleans or where?
Mr. RosENBAUM. I definitely don't know. That is the truth. I
definitely don't know.
The Chairjman. In February 1049 when they cut off their wire
service, then you got it directly from New Orleans, is that correct?
Mr. RosENBAUM. We sent a man to New Orleans and he in turn
phoned it in to our offices, our own man, Mr. Mooney.
The Chairman. Then at that time it didn't come through
Mr. RosENBAUiNi. The regular channels.
The Chairman. It did not come through Miami at all?
Mr. RosENBAUM. No, sir.
The Chairman. When you got the news service from Miami did you
get it on a ticker or by telephone ?
Mr. RosENBAUM. By telephone, sir.
The Chairman. Did you ever get news service by ticker?
Mr. RosENBAUM. No, sir.
The Chairman. Then after the wire service was reinstated some 2
weeks later, 3^011 dropped the New Orleans service and began getting
it again from the Miami man ?
Mr. RosENBAUM, That is correct, sir.
The Chairman. In 1950, before you ceased doing business, where
were you getting your service from ?
Mr. RosENBAUM. Locally in the Miami area,, from the same source.
The Chairman. The Florida statute prohibiting the transmission
intrastate of racing information for gambling purposes was passed
by the 1949 legislature, was it not?
Mr. RosENBAUM. I believe you are correct.
The Chairman. What happened after that statute was passed ? Did
you continue getting wire service just as you did before ?
Mr. RosENBAUM. Yes, sir.
The Chairman. There wasn't any interruption at all?
Mr. RosENBAUM. The service was not quite as good but we received
the service.
The Chairman. How do you mean it wasn't as good ?
Mr. RosENBAUM. It was slower, I would say, from what I under-
stand.
592 ORGANIZED CRIME' IN ESTTERSTATE COMMERCE
The Chairman. You mean they probably had to get it out of the
race tracks by signal and wig- wag methods ?
Mr. RosENBAUM. That is very possible, sir.
The Chairman. And get it down to Miami and get it over to you.
You think that is what happened ?
Mr, RosENBAUM. I believe so.
The Chairman. Do you know any of the Continental Press people?
Mr. RosENBAUM. No, I do not.
The Chairman. You do not know where the Miami people got their
wire service?
Mr, RosENBAUM. Definitely not.
The Chairman. I think it should be stated in connection with Mr.
Ben Cohen's testimony that the record shows, I believe the testimony
of Mr, Irvin, the attorney general of the State of Florida, before our
committee in Miami and also the assistant attorney general, Mr, Owen,
before the Interstate and Foreign Commerce Committee in Washing-
ton prior to that time, that on one occasion when the wire service was
discontinued so that there could not be off-track betting that the in-
crease at Hialeah per day in the take was $200,000 a day. Was that
the amount, Mr. Cohen ?
Mr. Cohen. I would have no knowledge of that.
The Chairman. I believe it was that amount, $200,000.
That is all, Mr. Rosenbaum.
Mr. Halley, May I ask one question, I believe you did testify pre-
viously, and I presume you haven't changed your mind, that the local
wire service which S. & G, received emanated from Continental Press.
Isn't that right?
Mr. Rosenbaum. I didn't say that, Mr. Halley.
Mr. Halley. I thought you did.
Mr. Rosenbaum. Oh, definitely not.
Mr. Halley. Wasn't it a Continental Press service?
Mr. Rosenbaum. I do not know.
Mr. Halley. Several of the other witnesses have said that. Do you
disagree with them ?
Mr. Rosenbaum. I have no way of knowing. From hearsay you
hear a lot about Continental. We have never negotiated with Contin-
ental. I have had no business with them at all and do not know whether
or not the people we received the service from received it from Contin-
ental. I don't want to go on record as saying that because I do not
know that to be a fact.
Mr. Halley. You continued getting your service from Byrnes both
before the shut-off and after?
Mr. Rosenbaum. That is correct.
Mr. Halley. Right up to the time you discontinued ?
Mr. Rosenbaum. To the best of my knowledge, I believe it was just
that way, sir.
Mr. Halley. You have heard the testimony of at least the other wit-
nesses, your associates, who said they understood it was from Contin-
ental Press that the service emanated, is that correct?
Mr. Rosenbaum. I didn't hear that ; no.
Mr. Halley. Didn't you hear it?
Mr. Rosenbaum. No; I didn't.
Mr. Halley. If they so testified, were they wrong?
ORGANIZED CRIME! IN INTERSTATE COMMERCE 593
Mr. RosEXBAU^r. I would say that they were guessing. I imagine
I would know. It may be taken for granted.
Mr. Hallet. But you don't know one way or the other ?
Mr. RosENBATjM. I do not know that Continental Press controls it
other than what you hear. We did no business with Continental.
Mr. Halley. Where did Byrnes get his service ?
Mr. Rosenbaum. I do not know,
Mr. Halley. Didn't you try to find out where you could get it?
You might go to the same place Byrnes did. When Byrnes shut you
off didn't you make efforts to get service somewhere?
Mr. RoSENBAUM. Other than that New Orleans proposition.
Mr. Halley. Why would you go to New Orleans ? Why wouldn't
you go to Byrnes' source ?
Mr. RosENBAUM. Byrnes was the source of information, Mr. Halley.
Mr. Halley. He got it from somewhere else. You knew that.
Mr. Rosenbaum. But locally you couldn't get it if you didn't get
it from Mr. Byrnes, because he had the service, the main service.
Mr. Halley. If he didn't want to give it to you, couldn't you get it?
Mr. Rosenbaum. I don't know of any other way in that area, sir.
Mr. Halley. But he got it from someone else.
Mr. Rosenbaum. That is very possible.
Mr. Halley. Isn't that the fact ?
Mr. Rosenbaum. I really don't know.
Mr. Halley. You must know. You weren't born yesterday.
IMr. Rosenbaum. Here is what I am trying to say.
Mr. Halley. Byrnes didn't go to the tracks and get that service.
He got it from someone else.
Mr. Rosenbaum. Mr. Halley, I do not know whom Byrnes got the
service from.
Mr. Halley. I am not asking whom he got it from. Did he get
it from someone else ?
Mr. Rosenbaum. I imagine so.
Mr. Halley. He was the middle man.
Mr. Rosenbaum. Yes ; I would say that, sir.
Mr. Halley. But you don't know who he got it from ?
Mr. Rosenbaum. Definitely I do not know who he got it from.
. Mr. Halley. You have heard the testimony that others understood
it was Continental.
Mr. Rosenbaum. They may take it for granted. Following that,
I may say that, too, but I have nothing to base it on.
Mr. Halley. Have you any idea of any other persons or groups
that could have been the source of Byrnes' wire service ?
Mr. Rosenbaum. No, sir ; not to my knowledge.
Mr. Halley. You testified that you got your service from New
Orleans when the wire was shut off,
Mr. Rosenbaum. Yes, sir.
Mr. Halley, And that a few days — when it was shut off on S. & G.
originally other people continued to get it, is that right ?
Mr. Rosenbaum, That is very possible.
Mr. Halley. It is the fact, isn't it ?
Mr. Rosenbaum. They may have gotten it. We didn't get it and
that is all we were concerned with.
Mr. Halley. They were getting it in. Miami, for instance ?
594 ORGANIZED CRIME! IN INTERSTATE COMMERCE
Mr. KosENBAUM. That may be true.
Mr. Hallet. Isn't it ?
Mr. RosENBAUM. I just don't remember that particular point. They
probably did if you say there was service coming in to the Miami area.
Mr. Hallet. You know it. You were the inside man. You were
getting all the complaints from your bookies. Weren't they telling
you that Craig was getting it in Miami and that others were getting it'^
Mr. RosENBAUM. That may be possible.
Mr. Halley. Isn't it the fact?
Mr. RosENBAUM. When you speak of it in that light I just have no
way of putting my finger right on it. I imagine it is so.
Mr. Halley. A few days later the service was shut off over the entire
State of Florida, is that right?
Mr. Rosenbaum. I believe it was.
Mr. Halley. But it wasn't shut off in New Orleans.
Mr. Rosenbaum. I don't think so.
Mr. Halley. Why couldn't you keep right on getting it from New
Orleans if that was your source?
Mr. Rosenbaum. I don't know the answer to that, sir.
Mr. Halley. That sounds to me like a question you would have to
answer in order to have your story stand up as being even possibly
plausible.
Mr. Rosenbaum. The entire thing was just a case of a lot of con-
tention at the time and a lot of raids and the like of that. There was
no reason to try to be active and have all that trouble.
Mr. Halley. You knew the heat was on from Chicago and until you
settled with Russell there was no point in fooling around. Isn't that
the fact?
Mr. Rosenbaum. I can't say that, Mr. Halley.
Mr. Halley. You can't deny it, though, can you ?
Mr. Rosenbaum. I can deny it. I am just saying there was a lot
of contention locally, a lot of raids and the like of that, and there
was no sense in operating under those conditions.
Mr. Halley. You tried to operate from New Orleans, you testified.
Mr. Rosenbaum. Yes, sir ; we did.
Mr. Hallet. You got service for a few days.
Mr. Rosenbaum. Then there were quite a number of raids and the
like of that, and we stopped operating.
Mr. Halley. You mean police raids?
Mr. Rosenbaum. Yes, sir.
Mr. Halley. You mean it was synchronized so that at the same
time the wire service was cut off the police got after you?
Mr. Rosenbaum. That may have been.
Mr. Halley. The police activity was through this man Crosby, the
Governor's special investigation ; is that right ?
Mr. Rosenbaum. It may have been. I don't know.
Mr. Halley. Wasn't it"?
Mr. Rosenbaum. I don't know definitely.
Mr. Halley. You don't seem to know anything, Mr. Rosenbaum,
that would affect your business.
Mr. Rosenbaum. I have answered everything to the best of my
ability.
ORGANIZED CRIME' IN INTERSTATE OOMME'RCE 595
Mr. Halley. I don't think you have. I think yon are evasive and
I think you are deliberately saying you do not know things you do
know.
Mr. RosENBAUM. There was contention at the time. There were a
lot of raids.
Mr. Halley. There were a lot of raids.
Mr. Rosenbaum. We stopped our business.
Mr. Halley. That is when Crosby was active, isn't it ?
Mr. Rosenbaum. He may have been there around that time.
Mr. Halley. He was there, wasn't he?
Mr. RosEXBAUM. Just about that time.
Mr. Halley. Let's have one definite answer.
Mr. Rosenbaum. I believe so.
Mr. Halley. That is all.
The Chairman. I think in order to try to get this wire service
straightened out we should put in the record three exhibits. (Three
work sheets prepared by Mr. H. G. Robinson, associate counsel, were
marked '"Exhibit Xos. 1G6, IGT, and 168," and appear in the appendix
on pp. 789-790. Exhibit No. 166 : Checks issued for "regular" wire
service; exhibit Xo. 167: Checks issued for '"special" wire service;
exhibit No. 168: Gross betting receipts.) The first one starts off
January 5, 1948, showing payments for wire service, $1,500, then
$2,500, and later $600, through that year and apparently it is endorsed
by the Dade County News Dealers Supply Co. That is Mr. Byrnes.
That was his outfit.
Mr. Rosenbaum. Yes, sir.
The Chairman. Then for some reason during the same time checks
were made to cash per month for a while for $280, later $349, and they
are also endorsed by the Dade County News Dealers Supply Co. durino;
that same period of time, apj^arently, or during most of the time. Do
you know why that was? AVhy was there a duplication of checks?
Why were two checks issued at the same time?
Mr. Rosenbaum. For service, Senator.
The ChxVIrman. One seems to be the regular wire service and the
other seems to be issued for special wire service. What was the
difference?
Mr. Rosenbaum. Special wire service?
The Chairman. Yes. For instance, January 1, 1948, you have a
check for regular wire service, $1,500, endorsed Dade County News
Dealers Supply Co., and on the same date, special wire service, a check
for $228.37, endorsed Dade County News Dealers Supply Co.
JNIr. Rosenbaum. I am not familiar with that ])articular item,
offhand I don't know what special wire service would be.
The Chairman. Then later on, beginning the 13th of January 1949,
the checks seem to be made to Intrastate News and Service. Byrnes
was still running that ?
Mr. Rosenbaum. That is right ; yes, sir.
The Chairman. There seems to be one check here to the Graham
Press. Where did that come in, do you know ?
Mr. Rosenbaum. That may be for the scratch sheets and forms.
Senator. I don't know. That is possible. I believe they printed
the sheets.
The Chairman. We will make these sheets showino- the wire service
payments beginning Januaiy 1, 1948, to the end of the time you oper-
59(5 ORGANIZED CRIME' IN INTERSTATE COMME'RCE
ated, exhibits to your testimony. Will you look at them and verify
them ?
Mr. RosENBAUM. They must be correct. I would have to check the
books.
The Chairman. Mr. Robinson, did you verify these from the books
of the company ?
Mv. Robinson. I took those from the actual canceled checks.
Mr. Rosenbaum. The payments for the services. That must be
correct.
The Chairman. That is all, I believe, unless you have something.
Mr. Griffin, will you come around, sir? Will you swear the testi-
mony you will give this committee will be the whole truth and nothing
but the truth, so help you God?
jNIr. Griffin. I do.
FURTHER TESTIMONY OF C. V. GRIFFIN, ACCOMPANIED BY DAVID
REICH, ATTORNEY, WASHINGTON, D. C.
Mv. Halley. ]Mr. Griffin, you previously testified before this com-
mittee in Miami; is that right?
Mr, Griffin. Yes, sir.
Mr. Halley. At that time there was some question as to whether
certain statements which Mr. Downey Rice, who is sitting right here,
believed you made, had been made by you. I think you at least very
much doubted whether you made those statements.
Mr. Griffin. That is correct.
Mr. Halley. I believe you volunteered to appear here again today
and go into that matter more fully, is that correct.
]\Ir. Griffin. That is correct.
Mr. Halley. When Governor Warren decided to run for the gov-
ernorship back in 1948, did he call upon you to handle his campaign?
Mr. Griffin. Yes, sir.
Mv. Halley. Just what happened ?
Mr. Griffin. His campaign was practically at a standstill for
money to operate. He asked me to come and help him out and
handle the finances and managing of the campaign.
Mv. Halley. You then called on Lou Wolf son to help ?
Mr. Griffin. That is correct.
Mr. Halley. Then William Johnston entered into the picture?
Mr. Griffin. That is correct.
Mr. Halley. How did Johnston enter into the picture?
Mv. Griffin. By invitation, the same as Mr. Wolfson.
INIr. Halley. Who invited him?
Mr. Griffin. Mr. Johnston had been invited. He had been in the
campaign back in 1940 with some money. The Governor suggested
that he be invited. Both Mr. Johnston and Mr. Wolfson before I
came into the picture had put a small amount of money in his
campaign.
Mr. Halley. I think you stated to Mr. Rice that Johnston was
souglit out because of his known dog track holdings and because he
seemed to have access to large amounts of money.
ORGANIZED CRIME IN INTERSTATE OOMME'RCE 597
Mr. Griffin. I knew he liad lar<ie do<r track liol(liii(;s and was con-
sidered quite well-to-do and thouiiht lie \v(^uld be interested in it.
I thought he would come along with some finances.
Mr. Halley. Each of you, you, Wolfson, and Johnston, put $154,000
into the campaign, is that rights
Mr. Griffin. I put $154,000. We all divided up the expenses
equally. We didn't restrict anybody from putting in money. We
accepted it from an34)ody who offered it, but we got very few contri-
butions.
Mr. Hali.ky. Were those contributions made by check or by cash?
Mr. (triffix. How is that?
Mr. Hali.ey. Were the contributions made by check or by cash?
Mr. (iRTFriN. All mine w^ere made by check. I think all of Mr.
Wolf son's after the start of the treasury of the campaign when we
decided who would be treasurer, were made mostly to him. I think
I received one check from Mr. Johnston. When we agreed to put up
so much money, we put it up to the treasurer and each one of us took
our money down there.
Mr. Halley. Isn't it a fact that most of Mr. Johnston's contribu-
tions were made in cash ?
Mr. Grifp^in. I understood that they were; yes,
Mr. Halley. You made certain statements to Mr. Rice about your
having come to the conclusion that Mr. Johnston's motives in the cam-
paign were tied up with certain Chicago racket elements, is that
correct ?
Mr. Griffin. I believe there is a little misunderstanding there.
That was not a statement. It was my opinion from information that
I had received and what I read in the papers and people — it was
common gossip that he had connections in Chicago.
Mr. Halley. Of course, during this campaign you
Mr, (triffin. None of it came up during the campaign,
Mr. Halley. I am just leading up to it. During the campaign you
and Wolfson and Johnston had practically financed it together, is that
riffht ?
Mr. Griffin, That is right.
Mr. Halley, You assumed a great responsibility,
Mr. Griffin. Quite a responsibility I would say,
Mr. Halley, In each case there was a question about what a man
would be expecting to get out of it where he had put $150,000 into a
campaign, isn't that right?
]\lr. Griffin. There was vei-y little discussion that I remember
about what any of us expected to get out of it. Of course, I knew
what I had expected to get out of it, and that was some citrus laws
:hat I thought would benefit my business.
Mr. Halley. You have already testified that as a result your partner
tvas made citrus commissioner?
Mr. Griffin. Without pay, citrus commissioner.
Mr. Halley. And he handles that?
Mr. (triffix. All the legislation is worked out by him.
Mr. Halley. Then I think you had a considerable discussion with
VLr. liice about how, after the campaign, you "came to a conclusion,
^r. Johnston was interested in representing certain Chicago interests
" Florida, is that right?
I
598 ORGANIZED CRIME IN EMTERSTATE COMMERCE
Mr. Griffin. I told Mr. Kice that it was gossip in the papers and
possibly in my opinion they had connections in Chicago, but I never
made the direct statement that he had.
Mr. Halley. You said the thing had begun to impress itself on
your mind as a conclusion, is that right?
Mr. Griffin. That is correct.
Mr. Halley. In fact, you met John Patton with Johnston, is that
right ?
Mr, Griffin. The only time I met Mr. Patton I was with him at a
wedding in Jacksonville where there were several hundred people,
there were priests and doctors and bankers and everyone there.
Mr. Halley. Apparently you gave the impression then and made
the statement quite definitely to Mr. Rice that in meeting Patton
at this wedding of the Johnston family was one factor that opened
your eyes. Is that so ?
Mr. Griffin. Yes.
Mr. Halley. To put it very briefly, isn't it a fact that you told
Mr. Rice at the time he interviewed you that as the situation pro-
gressed, it became apparent- to you that Johnston's motive in con-
tributing to the campaign was to assure his group of protection to
operate gambling interests in Florida?
Mr. Griffin. I can't say that I made that statement. There were
indications of that. It was in the ])apers, gossip. I don't believe that
I made the statement directly, but there were lots of things that
indicated that.
Mr. Halley. The indications were such that your conclusions got
strong enough that you asked the Governor to appoint you a special
investigator, is that right ?
Mr. Griffin. That is right.
Mr. Halley. In fact — —
Mr. Griffin. I did not only for gambling, but there were other
things happening that I didn't like the looks of, and I asked to be
special investigator for the Governor's office. That took in a lot of I
territory, anything that I might find that wasn't to the best interests.
Mr. Halley. In fact, you received a card from tlie Governor dated
July 21, 19^9, designating you as chief investigator?
INIr. Griffin. That is correct.
Mr. Halley. I think you stated that one of the things you were
interested in was gambling.
Mr. Griffin. I was interested in gambling iis well as many other
things that seemed to be, I thought, embarrassing to the Governor or
might become embarrassing, even at the time.
Mr. Halley. I think you testified that some time after that you
had asked the Governor to announce your appointment, is that right?
Mr. Griffin. My appointment was announced along, I think, in
January some time. I don't remember just what date. I believe it
was the latter part of January or Februarv.
ISIr. Halley. The card says the 21st of July 1949.
Mr. Griffin. At the time he a])])ointed me chief investigator I told
the Governor I didn't want to take any active part at the time, that
it was merely an appointment that might become necessary. I was
in the fruit business and didn't want to get in the investigating busi-
ness, but if conditons came about tliat iiuule it imperative in my mind
ORGANIZED CRIME' IN INTERSTATE COMMERCE 599
that I tliought he needed me, I would take the responsibility of
straightening anything out, not only gambling, but anything else.
Mr. Halley. When was it made public, in January of 1950?
Mr. Griffin. Whenever the press release was, I don't remember.
Mr. Halley. The next day it was rescinded, is that right?
Mr. Griffix. The next day or maybe the second day, shortly after
Ihe announcement.
Mr. Halley. I think you have already testified that you tied in the
rescission of that appointment with a visit by Mr. Johnson to Talla-
hassee, is that right?
Mr. Griffin. The announcement was in the Sunday papers. I saw
Mr. Johnston in Tallahassee Monday afternoon, and at approximately
10 o'clock Monday night the Associated Press called me and said I
had been suspended and fired as chief investigator and asked me for
an answer.
Mr. Halley. Did you tell this Mr. Rice that in your opinion the
Governor was considerably perturbed about the situation in the
sense of actual fear for his physical welfare?
Mr. Griffin. I can't remember ever making a statement of that
kind.
Mr. Halley. Didn't you say that as a result of various conversations
you had with the Governor you came to the conclusion that he had
received some threats?
Mr. Griffin. The Governor was in the hospital along in January and
Christmastime. He was in quite a nervous condition. There was a
considerable number of rumors around that you would hear on the
street corner. In fact, I even asked him, "Tell me what is bothering
you, what is the trouble?" He refused to say there was any trouble
except he was just nervous, his health was bad. He never would say
anything. You could get the gossip, what other people would tell
you.
Mr. Halley. Didn't you tell Mr. Rice that it was your conclusion
that the Governor had received threats both by telephone and per-
sonally from various strong-arm men?
Mr. Griffin. I don't remember making that statement. He pos-
sibly had, but not to my knowledge.
Mr. Halley. But you had heard those things ?
Mr. Griffin. I hadn't learned that he had told anyone. I had
heard that gossip. Other people had told me, but I hadn't heard it.
Mr. Halley. Would you say it was more than gossip that the Gov-
ernor had been threatened?
Mr. Griffin. Not common gossip, no, I wouldn't say that, but I
heard it from several people, more than one person.
Mr. Halley. I think that is all.
The Chairman. That is all, Mr. Griffin, unless you have something
you want to add.
Mr. Griffin. Nothing.
The Chairman, Or your counsel ?
Mr. Reich. I have nothing to add.
The Chairman. Mr. Johnston, will you come around, please? Do
you solemnly swear that the testimony you will give before this
committee will be the truth, the whole truth, and nothing but the
truth, so help you God ?
Mr. Johnston. Yes, sir.
68958 — 50— pt. 1 39
600 ORGANIZED CRIME IN INTERSTATE OOMME'RCE
TESTIMONY OF WILLIAM H. JOHNSTON, JACKSONVILLE, FLA.,
ACCOMPANIED BY JOHN W. PEHLE AND LAWRENCE S. LESSER,
ATTORNEYS, WASHINGTON, D. C.
The Chairman. What is your name, sir ?
Mr. Lesser. Lawrence S. Lesser, and this is Mr. Pehle.
The Chairman. Mr. Lesser, are you an attorney of Jacksonville?
Mr. Lesser. No, of Washington, D. C.
The Chairman. And Mr. Pehle?
Mr. Lesser. Also of Washington, D. C.
The Chairman. All right, Mr. Halley.
Mr. Halley, Mr. Johnston, I understand you have a statement you
would I'ke to make to the committee before you are questioned.
Mr. Johnston. I would, sir.
Mr. Halley. Before we do that, may we have your full name and
address and your business ?
Mr. Johnston. It is in this statement.
Mr. Halley. Go right ahead.
The Chairman, Do you have extra copies of your statement?
Mr. Johnston. I will give you this one.
Mr. Chairman and members of the committee, my name is William
H. Johnston. I reside at 1090 Arbor Lane, Jacksonville, Fla. I am
interested in and am an official of various corporations which run legal
horse- and clog-racing tracks.
At the outset I want to express to this committee my appreciation
for the opportimitj^ afforded to me to appear before it. I offer the
committee my full cooperation. As is apparent from the nature of my
business, I am interested in seeing that gambling is not conducted in
any way which will violate the laws of any State. I take it, however,
from reading the Senate resolution which established this committee
that it is not the purpose of the committee to attempt to prove that
legalized gambling on horse and dog racing is bad or to recommend
that those many States which have seen fit to legalize horse and dog
i-acing and parimutuel betting change those laws.
I gather from the articles which have appeared in the press that
this committee is interested in knowing my business connections and
is interested in the details of my contributions to the campaign of
Gov. Fuller Warren and the reasons therefor. First, let me list
my business connections. I am the president of the National Jockey
Club which owns Sportsman's Park near Chicago, at which horse rac-
ing is conducted. In addition, I am the president of the following
establishments which conduct clog races in Florida : Miami Beach Ken-
nel Club, Jacksonville Kennel Club, Orange Park Kennel Club, and
Associated Outdoor Clubs.
I and my immediate family own minority stock interests, rang-
ing from 10 i^ercent to approximately 27 percent, in each of these
racing establishments. These holdings are our personal possessions,
having been purchased out of our own funds and are not and never
have been held for any other person or persons whatsoever. All of
the aforesaid racing establishments operate racing tracks with pari-
mutuel betting pursuant to and in accordance with the laws of the
States in which those tracks are situated. It is obviously not in the
interest of those tracks that bookmaking establishments be permitted
to operate.
0/EGANIZED CRIMEi IN INTERSTATE COMMERCE 601
With respect to my contribution to the campaign of Governor Ful-
ler Warren, I am happy to discuss it in detail. I have known Gov-
ernor Warren as a close and intimate friend for more than 15 years.
My acquaintanceship over this period of time has convinced me that
lie is an able, competent, and honest man — a man who I felt would
make and indeed has made an outstanding Governor for the State
of Florida. It was this and my strong friendship which prompted
me to help Fuller Warren.
My participation in this matter came about in the following man-
ner. I was approached by Mr. C. V. Griffin, a citrus growler in the
State of Florida, and Mr. Louis Wolf son, a Jacksonville business-
man, relative to underwriting Fuller Warren's campaign for Gov-
ernor. We agreed jointly to underwrite that campaign and
immediately each of us put up the sum of $25,000. At the time I
thought that sum probably would be sufficient, but it wasn't. Ap-
parently word got out in one form or another that adequate arrange-
ments had been made to finance Governor Warren's campaign, and
accordingly many of the good people of the State of Florida who
otherwise would have contributed felt that there was no necessity
for a contribution from them and oui" underwriting pledge amounted
to much more than any of us originally thought. However, I had
given my word and although it cost me more than I had originally
intended, my word was my bond, and I carried out my agreement
with Mr. Griffin and Mr. Wolfson. As a result, I turned over for
that campaign approximately — when I say approximately, it might
be four or five thousand dollars either way there — approximately
$100,000. Of this sum I collected $35,000 from my brother, J. R.
Johnston; $10,000 was contributed through me by Max Silverberg,
of Miami Beach, Fla. The rest of this money came from my own
personal funds, with the exception of $15,000 which I received in con-
nection with the second primary from James R. Bussey, of St. Peters-
burg, Fla.
Why the help which I gave Governor Warren should cause such
a stir I am unable to understand. I am not a politician but I want
to say to this distinguished committee that if a man who has been
fortunate enough to acquire a little means cannot help a close per-
sonal friend to achieve his life-long ambition, then we are departing
from what I have always thought to be a traditional American
practice.
The Chairman. How much longer is your statement, Mr. Johnston?
Mr. Johnston. About 2 minutes.
The Chairman. I am afraid we will have to declare about a 15-
minute recess. That one bell means there is a vote on some matter.
I regret that we will have to have a recess for 15 minutes. Then we
will be back.
(Brief recess.)
The Chairman. All right, Mr. Johnston, if you will proceed with
your statement.
Mr. Johnston. Before closing this statement, I want the record to
show that I am now and always have been willing to appear before
this committee and to cooperate in whatever way I can. It has come
to my attention that the fact that I was unable "to appear before this
committee when it first held hearings in the State of Florida resulted
602 ORGANIZED CRIME> IN INTERSTATE OOMME'RCE
in newspaper stories to the effect tliat I liad fled the coimtry to avoid
the committee's siibpena. This I strenuously object to. The facts
are that last winter, many months before the formation of this com-
mittee, I planned, with my wife and son, both of whom subscribe to
the Catholic faith, that I would take them on a pilgrimage to Rome
this year, my twenty-fifth wedding anniversary. We made applica-
tion to the State Department for our passports, I believe in April,
having previously arranged our passage.
As a matter of fact, a newspaper columnist 2 months before had
published the fact that I was making a trip abroad and Avas sailing
on May 23, my twenty-fifth wedding anniversary. I carried out those
plans with my family and while in Europe visited Rome, England,
Ireland, Scotland, Switzerland, and France, returning to the United
States on the steamship Queen Elizabeth on Jime 29. I remained at
my home in Jacksonville until July 5. Thereafter I was at all times
either at the Sportsman's Park offices or at my summer home at Sauga-
tuck, Mich. At no time did I dodge any subpena. When I learned
through the press that the committee desired my testimony, I sent to
the honorable chairman of this committee a telegram expressing my
willingness to appear at a later date at the convenience of the com-
mittee. I heard nothing further from this committee until last
Wednesday, when I was told that a subpena had been issued. I
promptly drove 140 miles to Chicago to accept that subpena.
The Chairman. Mr. Johnston, I think the record should show that
your telegram was received in the morning, and I read it into the
record at the public hearing at Miami the same morning. So it was
made a part of the record. I explained to the press at that time that
the telegram had come, and it appeared that you were willing to
testify, and I thought that was a reasonable explanation.
Mr. Johnston. Thank you.
The Chairman. You may proceed.
Mr. Johnston. In conclusion I want to state that I am not a gambler.
I do not and have never knowingly engaged in illegal activities of
any nature whatsoever. If the statement which I have read is in-
complete on any point within the province of this committee and on
which the committee desires further information, I shall be happy
to answer the committee's questions to the best of my ability.
The Chairman. We are going on for a while, Mr. Johnston. I
don't know how long your testimony will take. In case we carry over
until tomorrow, what is your situation ?
Mr. Johnston. I prefer to get it over tonight. Friday night I
have been invited to Chicago for the all-star football game and have
invited people to be my guests at the football game.
The Chairman. You fly, don't you ?
Mr. Johnston. Yes, sir.
The Chairman. Tomorrow is Thursday, I believe.
Mr. Johnston. That is true. I could stay tomorrow.
The Chairman. You could be here tomorrow.
Mr. Johnston. Oh, yes, sir. Any time you want me, I will be here.
The Chairman. We will go along a while now, and if it seems as
though it is going to be too late, we will recess over until tomorrow.
All right, Mr. Halley.
Mr. Halley. Mr. Johnston, first, with reference to the subpena,
sometime before the committee hearings opened in Miami the com-
ORGANIZED CRIME IN INTERSTATE OOMME'RCE 603
mittee investigators made very strenuous efforts to locate you through
your office in Jacksonville, through your home, and through Mr. Rush.
Mr. Johnston. Mr. Halley, if the committee or your investigators
tried to locate me, they never left word who they were, with the
exception of Mr. Rush.
Mr. Hali.ey. We spoke to Mr. Rush at least 2 days before the hear-
ings opened, and in fact Mr. Rush said — and I call it to your attention
for your comment — that the reason you felt that you could not afford
to ajjpear at the hearings in Miami was that there would be con-
siderable question raised about your contributions to the campaign in
view of the Florida law which makes it illegal for a company engaged
in racing to make contributions, and it makes it prima facie a violation
of the law for an officer of such a company to make a contribution.
You said you thought it would interfere with your getting racing
dates. Is that something that was communicated by him to you?
Mr. Johnston. No, sir. The first that I received word from Mr.
Rush was a telephone call on a Thursday, and I believe you were
meeting in Miami the next day. Immediately on getting that tele-
phone message
Mr. Halley. I am quite serious, because on the Monday and Tues-
day previous Mr. Rush was spoken to at great length by Mr. Rice, our
assistant counsel, and he promised to get in touch with you immedi-
ately. He is your counsel, isn't he ?
Mr. Johnston. No, He is counsel for one of my race tracks, but I
have no personal counsel other than these gentlemen. This is the first
time I have ever had to have personal counsel.
Mr. Halley. You have gotten service from the people who represent
the tracks, in other words. Isn't that so ?
Mr. Johnston. In what form?
Mr. Halley. Legal service.
Mr. Johnston. I never have had any legal service.
Mr. Halley. Haven't you ever had any legal advice from Mr. Rush ?
Mr. Johnston. Not as to my personal affairs.
Mr. Halley. In connection with this contribution Mr. Rush did
finally reach 3'ou?
Mr. Johnston. I got a message on Thursday, I believe it was.
Mr. IL^LLEY. Not before that?
Mr. Johnston. Thursday I got the message at my office in Chicago.
Mr. Halley. The committee staff held hearings on Thursday, Fri-
day, and Saturday.
Mr. Johnston. On Friday I sent the telegram.
Mr. Halley. It was a night letter which the committee received that
night or the next morning.
Mr. Johnston. I sent the telegram Friday morning about 11 o'clock.
Mr. Halley. Didn't it occur to you that as a citizen it was your
iuty to appear for those hearings or at least to offer to appear?
Mr. Johnston. I did offer to appear.
Mr. Halley. You offered to appear at some subsequent time in
[Chicago.
Mr. Johnston. At the time that I received that telegram, the first
ime I knew of it was on a Thursday and your hearing had already
itarted. I immediately sent you that telegram offering at my own
■v'-'^'.nse to appear any place, any time that you set.
604 ORCMNIZED crime: m INTERSTATE OOMME'RCE
Mr. Halley. But not offering to appear at the hearings in Florida.
In fact, you delayed a whole day before telegraphing.
Mr. Johnston. I didn't delay a whole day. , -r, i
Mr. Halley. The committee tried to reach you at Sportsman s i:'ark
in Chicago by telephone.
Mr. Johnston. If they did, they left no word who was callmg.
Mr. Halley. They most certainly did.
Mr. Johnston. I didn't receive the information.
Mr. Halley. Let's not say things like that. ^^ tt n u
Mr Johnston. I am not saynig things like that, Mr. Halley, be-
cause I sent that telegram the minute I heard of it. It was the far-
thest thing from my mind that this committee would even want to
hear me. I am not in any illegal business.
Mr. Halley. You are a pretty well-known man, aren t you i
Mr. Johnston. I am. ^ ^ ^i
Mr Halley. The committee actually issued a statement to the press
and tiie radio which was very widely circulated on Wednesday, saymg
that you were among a number of witnesses who simply couldn t be
found. ^ ^ ■, ■ r^^^ 15
Mr. Johnston. I believe that is true, and I saw it m Ihursdays
paper. . ,. ,. ~ , i
Mr Halley. In fact, wasn't it the clear implication of your tele-
gram, which you neglected to send until Friday, that while you would
be willino- to appear before the committee, you hadn't the faintest
intentioiCif you could help it, of being served with a subpena for
appearing at the Miami hearings ?
Mr. Johnston. No, sir.
Mr. Halley. You said you would appear m Chicago or elsewhere.
Mr. Johnston. I believe I have the telegram here, and I will read
it to you and see. I think I have a copy.
Mr. Halley. Let's hear it.
Mr. Johnston. I am sorry if you misinterpreted the telegram.
Mr. Halley. I don't think I have. I think you just evaded the sub-
pena of this committee until you would be good and ready to appear,
Mr. Johnson. I am sorry you have that interpretation of it.
Mr. Halley. Let's read the telegram.
Mr. Johnston. Mr. Lesser, do you have a copy of that telegram i J
thought I had it here, l^ut I gave it to my attorney.
Mr. Halley. We will find it. i t i j -^m
Mr. Johnston. I don't have it here, I am sorry. I thought I had itl
Mr. Halley. It is in the record, and I will read it. This telegrair
was not received by the committee before Saturday morning, its lasl
day. . . ^
Mr. Johnston. Mr. Hallev, I want to interrupt you ]ust one mo-
ment. That telegram was sent about 11 o'clock on Friday, and if yoi
didn't receive it until Saturday morning, I think we ought to investi-
gate wliere it was held all that time.
Mr. Halley. The committee will probably form its own conclusion!'
as to that.
Mr. Johnston. I just wanted the record clear. I
The Chairman. 1 think it should be made clear where the telegramj
was. It was sent to the hotel. It may have been there at lunch time
ORGANIZED CRIME IN INTERSTATE COMMERCE 605
but we didn't return there for lunch. So it came to the attention of
the committee that night.
Mr. JoiixSTON. I addressed it to you, Senator, in care of the court-
house at JNIianii. They umst have delivered it to the hotel by mistake,
and I am sorry if that happened. I sent the telegram to the court-
house in Miami, where I understood the hearings were being held.
Mr. Halley. On Saturday morning, the last day of the hearings,
the chairman was able to put into the record the following telegram :
Information has reached me through the press that you desire my presence
before your committee in Miami, Fla. No official notice has reached me. I am
perfectly willing to appear before your committee without being subpenaed.
However, a harness-racing meeting opens toniglit at Sportman's Park of which
I am president. Consequently, it would be extremely inconvenient for me to
appear during the present hearings being held by your committee. The harness
racing meeting runs through August. 1 am informed that your committee will
convene in Chicago on July 21. As I will be in Chicago at that time, I will be
glad to appear then if you so desire. However, I shall appear at any other
future time you may designate and in Washington, if you wish, at my own ex-
pense. My recent trip to Europe —
This goes on about your European trip.
Isn't it perfectly clear from this that until it was too late for you
to be called to Miami, you just lurked in Chicago beyond the reach of
I our pi'ocess server ?
j Mr. JoiiNSTON. I wouldn't say that.
j Mr. Halley. Then you made it clear in your telegram that it was
I just inconvenient for you to show up in Miami and that you had no
! intention of doing so.
i Mr. Johnston. I would not construe it that way, Mr. Halley.
1 Mr. Halley. You said that you would appear at any other future
ijtime.
(1 Mr. Johnston. ]V1j\ Halley, you have no process server other than
Mr. McKeens, wlio I went and accepted that from.
Mr. Halley. In fact, in your very first sentence you say that im-
formation has reached you through the press.
Mr. Johnston. That is right.
Mr. Halley. Actually you have testified here that the information
reached you through Mr. Rush.
1 Mr. Johnston. It was both the press and my office. There was a
telephone call there and the newspapers. I don't know which one I
put in tliere. Possibly I should have said ]\Ir. Rush and the press, and
I would have been correct.
Mr. Halley. First, I assure you that the committee made the most
i^trenuous efforts and the press made the most strenuous efforts to get
iword to you, the committee as early as Monday and the press as early
IS Wednesday, that we had tried to serve a subpena at your usual resi-
lence and business places and couldn't find you. Second, ISIr. Rush
stated t6 the committee that your reason was that you wanted to
ivoid testifying about your contribution initil you had gotten your
■acing dates assigned. Third, your telegram bears out the fact that
,/ou had no intention of coming to Miami. You nowhere offered to
I'ome to Miami. You simply said you would be available at any other
"uture time.
I Mr. Johnston. Mr. Halley, there was only one call that ever came
p my home, and my daughter answered that call, so she advised me.
The Miami Daily News had called and left word for me to call back.
■J
606 ORGANIZED CRIME: IN ENTERSTATE OOMME'RCE
From the way the Miami Daily News has twisted every statement that
I have made, I wouldn't have called them back for $14,000,000.
Mr. Hallet. The committee made very many efforts to reach you,
Mr. Johnston.
Mr. Johnston. I am sorry that there is a misunderstanding of that,
Mr. Halley.
Mr. Halley. I don't think there is a misunderstanding. I think you
just didn't want to appear until you had gotten your racing dates.
Mr. Johnston. I am sorry that is your opinion.
Mr. Halley. You have received your racing dates, haven't you?
Mr. Johnston. Yes ; I have received my racing dates, but the racing
dates have nothing to do with appearing before this committee.
Mr. Halley. After you received your racing dates, the Governor
of Florida instituted an investigation of the countributions by people
connected with race tracks ; is that right ?
Mr. Johnston. That is correct.
Mr. Halley. But you got your racing dates.
Mr. Johnston. Subject to any investigation. If it is brought out
that any of the licensees made contributions to political campaigns,
that is a matter for the permit. The permit is canceled, and the rac-
ing dates are automatically canceled. In other words, there are two
different things in the racing law of Florida. There is the permit.
The permit holder applies for dates. If he is the holder of a legal per-
mit, the racing commissioner must give him the dates. However, it the
permit is taken away, the dates are canceled.
Mr. Halley. When you made your contributions — and I believe you
testified you.r personal contribution was about $100,000 of your money.
Mr. Johnston. That is right.
Mr. Halley. Were you not aware of the law of Florida relating to
contributions by racing associations and people connected with them?
Mr. Johnston. There is nothing in the law that says anything about
people connected with racing associations.
Mr. Halley. Then I had better read it to you.
Mr. Johnston. You had better read it, I think.
Mr. Halley. I read from section 1875.19 of the Florida Statutes
of 1941, a section making it a crime for any corporation or corporate
organization or any domestic corporation to make any contribution
to any political party or organization, and also making it further a
violation for any officer, employee, agent, or other representative of
such corporation to violate the section or to make a contribution. Then
it goes on to say, and I quote :
The violation of tliis section by any officer, employee, agent, attorney, or any
other representative of a corporation shall be prima facie evidence that such oflS-
cer, employee, agent, attorney or otlier representative is acting for and in behalf
of such corporation.
Mr. Johnston. I think you are i-eading the wrong statute.
Mr. Halley. I am reading the one tliat the attorney general of
Florida testified made your contribution illegal.
Mr, Johnston. Here is the statute. Section 1875.19 is the one you
were reading. The satute in regard to racing is 550.07.
Mr. Halley. At the moment I am working on a contribution by a
•orporation.
Mr. Johnston. The contribution by a coi-poralion is section 1875,
which has notliing to do with race tracks. According to this, any
ORGATSriZE'D CRIME' IN INTERSTATE COMMERCE 607
corporation or any bank or anything else where one of their employees
gave $1, they would get their charter canceled.
Mr. Halley. I understand that, but it has this very specific section,
that if an officer or employee or agent does it, it is prima facie
evidence.
Mr. Johnston. Not at a race track.
Mr. Halley. A race track as well.
Mr. Johnston. The race track law specificaHy states — let me read
it.
Mr. Halley. A race track is no different than any other company.
Mr. Johnston. I don't know. Let's see. Maybe it is.
Mr. Halley. Now we get to the race-track law.
Mr. Johnston. Section 550.07.
Mr. Halley. Of the statutes of 1941, which is the same statute.
Mr. Johnston. The statute you you are reading, 1875, is from 1897.
Mr. Halley. They are both Florida statutes of 1941.
Mr. Johnston. Let me ask you this. You are a lawyer. This statute
550.07, states :
It is unlawful for any licensee under this chapter directly or indirectly to make
any contribution whatsoever to any political party or to any candidate for any
State, county, district, or nninicipal office, and the comruissioner, upon proof of
any contribution having been made, shall immediately revoke the permit of such
licensee and no further license shall be permitted or issued to such former
licensee.
It doesn't say a word about employee there.
Mr. Halley. I know that particular section doesn't, but doesn't it
stand to reason — and I know the attorney general of the State of
Florida so testified — that where the president and a chief stockholder
of such a corporation makes a contribution, it can be and probably will
be construed to be an indirect contribution by the racing association?
Mr. Johnston. It states further in the racing law, 550.23, applica-
tion of laws inconsistent with this chapter :
All laws and parts of laws inconsistent with any of the provisions of this
chapter are expressly declared not to apply to any person participating or
engaged in racing or making contributions to pools therein and authorized
and conducted under this chapter.
In other words, the penalty under the racing law is the revoking
of your charter, and this cancels any previous laws as to any persons
who are engaged in racing.
Mr. Halley. It is perfectly apparent that the public policy of the
State of Florida was to keep people in the racing business from making
political contributions, isn't it? You are the heart and soul of four
dog tracks in Florida.
Mr. Johnston. I wouldn't say that.
Mr. Halley. You run them ; don't you ?
Mr. Johnston. I am the president of them.
Mr. Halley. You run them.
Mr. Johnston. I am the president and run them ; yes.
Mr. Halley. When you make a contribution, the track is making it.
Mr. Johnston. No, sir ; they are not making it when I make a con-
tribution.
Mr. Halley. Wliat is good for you is good for the track, and vice
versa.
Mr. Johnston. No, sir ; I am not making any contribution for the
race track when I make a personal contribution.
608 ORGANIZED CRIME IN INTERSTATE OOMME'RCE
Mr. Halley. You made a great deal of your contributions in cash,
did you not ?
Mr. Johnston. Yes, sir ; I did.
Mr. Halley. Do you ordinarily deal in large sums of cash ?
Mr. Johnston. Yes ; I have cash all the time.
Mr. Halley. How much of your contribution was in cash ?
Mr. Johnston. Wherever 1 gave a contribution to Griffin or to
Wolfson, I gave it in checks. Contributions that I made to the treas-
urer I made in cash.
Mr. Halley. How much would they be ? Would you say 10 percent
of your total was in cash ? Fifty percent ?
Mr. Johnston. I would say about 60 percent, 50 to 60 percent.
Mr. Halley. In other words, you contributed about $60,000 cash
money to the Warren campaign.
Mr. Johnston. Let me see. I would say maybe more than that.
Let me explain this to you so you will understand it.
Mr. Halley. I wish you would.
Mr. Johnston. This $100,000 that I said I contributed in to the
campaign is $100,000 that I gave in there. There was an additional
$35,000 that I had loaned to Griffin, that he paid me back. You un-
derstand that. In other words, if you add up the amount of cash
I say I put in plus t*lie checks, it will amount to maybe $130,000, but
some $30,000 of that was notes that I received from Griffin, which I
got back. So my contribution was about $100,000. Isn't that right?
Mr. Halley. Of that you say about $60,000 was in actual cash
money.
Mr. Johnston. Something like that ; yes.
Mr. Halley. Was that your own personal cash money ?
Mr. Johnston. I told you. Part of it was mine, part of it I got
from my brother, and part from Silverberg.
Mr. Halley. Who was Silverberg?
Mr. Johnston. Max Silverberg is a concessionaire. He runs a con-
cession at Arlington Park in Chicago, Washington Park, Sportsman's
Park, and my dog tracks.
Mr. Halley. What kind of concessions are they ?
Mr. Johnston. Hot dogs, hamburgers, liquor — a regular concession.
Mr. Halley. At the tracks ?
Mr. Johnston. At the tracks.
Mr. Halley. Who was the other person? You mentioned some-
body in St. Petersburg.
Mr. Johnston. James R. Bussey, an attorney from St. Petersburg.
Jim Bussey was supporting Mr. Schanz in the first primary. He told
me that if Mr. Sclianz won the second primary, he would help me raise
the money, because we couldn't raise any money. I don't know why, it
seems that everybody who was supporting Warren was broken or
didn't want to put any money up.
Mr. Halley. What is Bussey's business?
Mr. Johnston. An attorney.
Mr. Halley. He is reputed to represent a number of gamblers.
Mr. Johnston. He represents the chain stores, if you please. He
never represented a gambling house in his life.
Mr. Halley. Are you sure of that?
Mr. Johnston. I am positive.
Mr, Halley. Did anybody else contribute?
ORGANIZED CRIMD IN INTERSTATE COMMERCE 609
Mr. Johnston. Nobody else.
j\Ir. Halley. Why were these contributions made in cash rather
tliun by check?
Mr. Johnston. For the simple reason that that is how I wanted
them.
Mr. Halley. Why?
Mr. Johnston. For the simple reason that if Mr. Warren hadn't
won, I didn't want to be identified with any political cam})aign.
Mr. Halley. You did make some in checks.
Mr. Johnston. No, I never put it into the campaign fund. I gave
that to Lou Wolf son or to Griffin. There was never a check of mine
that M'ent into that treasury.
Mr. Halley. It would be perfectly apparent. As soon as anybody
asked any questions, it would come out where the money came from.
Mr. Johnston. When I started in this campaign, I started in to help
a friend of mine, and I didn't think it was good policy for me to be
in politics or to be in a campaign. I told these gentlemen that when
I did that I wanted to be in the background in the campaign, and
I would just help underwrite the campaign.
Mr. Halley. How much of your own monev is in this now ?
Mr. Johnston. I imagine around $45,000 or $50,000.
Mr. Halley. No more than that ?
Mr. Johnston. There was $35,000 of my brother's money. AVhat
is mine is his, and what is his is mine. That is the way we have been
all our lives.
Mr. Halley. And about $40,000 of your money ?
Mr. Johnston. Yes.
Mr. Halley. What were you looking for for this money? What
did you expect to get out of this campaign ?
Mr. Johnston. I didn't expect anything. As I told you before,
Mr. Halley, when I started in this thing Fuller Warren had been my
friend for 15 years. Mr. Griffin and Mv. Wolfson came to me and
asked me to underwrite this campaign. They said that unless the
campaign was solid and they knew there was some money in it. they
couldn't get contributions, and if we put up this amount of money,
it would naturally start the ball rolling and possibly they wouldn't
need any and we might get some of it back because contributions would
keep coming in. They never came in.
The CHAiitMAN. Mr. Johnston, because of the late hour I think that
we are going to have to recess this hearing until tomorrow. Un-
fortunately, every member of the committee has some other important
committee meeting in the morning, so I had in mind recessing until
1 : 30 tomorrow afternoon. Would that be convenient with you and
enable you to get away in time ?
Mr. Johnston. It would be; yes. You couldn't finish with me
tonight ? I don't want to tax you too long.
The Chairman. If it would be convenient with you, I think we
woidd rather finish up tomorrow afternoon.
Mr. Johnston. If it is convenient to you, I will wait.
The CHAiR:\rAN. The committee will stand in recess until 1 : 30
tomorrow afternoon at the same place.
(Wliereupon, at 6 : 10 p. m. a recess was taken until 1 : 30 p. m. the
following day.)
INVESTIGATION OF ORGANIZED CRIME IN INTERST4TE
COMMERCE
THURSDAY, AUGUST 10, ,1950
United St^^tes Senate,
Special Committee To In^testigate
Organized Crime in Interstate Commerce,
Washington^ D. C.
The committee met, pursuant to recess, at 1 : 30 p. m., in the caucus
room. Senate Office Building, Senator Estes Kefauver (chairman),
presiding.
Present : Senators Kefauver, Hunt, Wiley, and Kilgore.
Also present: Rudolph Halley, chief counsel; Harold G. Robinson,
associate counsel, Alfred Klein, and Downey Rice, assistant counsels.
The Chairman. The committee will come to order.
Before resuming testimony of Mr. Johnston, Mr. Schine is here
and has some additional testimony, or supplemental testimony, in
addition to that whicli was given in Miami that we want to ask him to
come around for at this time.
Mr. Schine, do you solemnly swear the testimony you give this
committee will be the truth, the whole truth, and nothing but the
truth, so help you God ?
Mr. Schine. I do.
PUETHER TESTIMONY OF MEYEE SCHINE, MIAMI BEACH, FLA.,
ACCOMPANIED BY OSCAR L. GRUBER, ATTORNEY, NEW YORK,
N. Y.
The Chairman. All right, Mr. Halley.
Mr. Halley. Mr. Schine, you have communicated with the com-
mittee and indicated that you would like to make a further statement
to clarify your previous testimony ; is that correct?
Mr. Schine. I did.
IMr. Halley. Will you go ahead ?
Mr. Schine. When certain information given to the committee in
Miami needed clarification and certain additional information that
n-asn't given, I thought the committee might be interested, so we
called Mr. Halley yesterday, or the day before, and asked him whether
le would care to have me appear again before the committee to make
corrections and additions, and he was kind enough to permit me to
ippear here, and here I am.
I am ready to be asked, or shall I go on ?
Mr. Halley. Which ever you prefer, Mr. Schine.
Mr. Schine. No. 1, if it doesn't take up too much time, I appeared
n Miami without a subpena.
611
612 ORGANIZED CRIME' IN INTERSTATE COMMERCE
The Chairman. Yes, sir; you appeared voluntarily and you paid
your own expenses to Miami, which the committee appreciates.
. Mr. ScHiNE. Thank you.
I might give a little history of our position in Miami. From the
very start we acquired the Roney F'laza at the end of 1943, and during
the period of the season of 1911 we had no bookmaking, although we
had been approached by many different persons.
We did find, however
The Chairman. Mr. Schine, excuse me a minute. I know this is
all clear in the record from Miami, but will you bring us up to date
and tell us when you acquired, and what the name of your company
was?
Mr. Schine. The Roney Plaza Co.
The Chairman. Of which you are the principal owner?
Mr. Schine. Yes, sir.
Although we were approached by a number of people asking to
give them concessions, we refused ; but we found that we had no maga-
zines, cigars, or cigarettes at the newsstand ; so, the manager got in
touch with someone who runs newsstands, and he came down and
offered us a price for the newsstand.
At the time they mentioned something about bookmaking. I
wouldn't consent to it, but I told them I would consider the matter.
But, after they were there for a while, maybe a week — I don't know
how long — we decided not to have them, and we gave them the money
back.
Then they agreed to run the newsstand without rental.
Mr. Hallet. The people you are referring to are Salvey and Levitt ?
Mr. Schine. Yes. They didn't run the neAvstand themselves; they
had a girl running it.
The following year we rented the newstand to a very reliable no-
tional cigar-stand outfit who operates cigar stands in various hotels:
and they, of course, had nothing to do with bookmaking, and that
pleased us very much, although the rental was very much lower.
During the year 1944-45 we were still approached by a great many
people, and we refused to have any bookmakino; there. At all times
we were annoyed a great deal by^ yhat you miglit call sneak-in book-
makers. They would come in as guests of the hotel, or as guests oi
the guests, and we were greatly annoyed by it; so we engaged n
number of detectives to watch them, but that didn't seem to help.
The next year, which was 1945^6, w^e were still annoy^ed greatly, but
we increased our detective force and we would not permit bookmakino
at the Eoney Plaza.
We felt the Roney Plaza was too nice a hotel for that.
In 1946-47, 1 think it was, Erickson, who had talked to me about it.
but I turned him down, a deal was made between the hotel and Erif^k-
son and Harold Furman.
Mr. Halley. Would you state how you happened to initiate siicli
discussions with Erickson ?
Mr. Schine. Well, prior to that time we had, as I said, a lot ol
trouble with sneak bookmakers, and we were thinking about letting it
go because there seems to be a code amongst them that, if one is in
there officially, then the others stay away. So a man came to see me.
introduced himself as an officer of Miami Beach.
ORGAlSnZED CRIME! in INTERSTATE COMMERCE 613
Mr. Halley. Who was this man ?
Mr. Sciiinp:. His name was Pat Perdue.
Mr. Halley. You mean Pat Perdue?
Mr. SciiixE. Yes.
Mr. Halley. Was lie known to you by reputation?
Mr. SciiiNE. I knew him by reputation, but not by meeting liim
Mr. Halley. He was known as the one-man gambling s(|[uad of
Miami Beach ; was he not ?
Mr. SciiiNE. Yes.
He came to me and said, "I understand you are considering letting
a concession out for the bookmaking?"
I said, "I wasn't sure that we would, but 1 am having so much
trouble that it might be the best thing to do."
He said, "I would say that you shouldn't let it go to Erickson."
Mr. Halley. That you should not ?
Mr. Schixe. Let it go to Erickson.
I said, "Why not?"
He said, ''We don't want any outsiders in here because Erickson
might get more hotels and then they would start a battle and we would
rather that you gave it to our local syndicate."
Mr. Halley. By the "local syndicate," you understood him to mean
the S. &G. Syndicate?
Mr. ScHiNE. Yes. That got me rather upset.
The Chairmax. Did you have an extensive discussion about it, Mr.
Schine, you and Officer Purdue?
Mr. ScHiNE. No; he came to me in the Cabana Club and we talked
maybe 5 or 10 minutes. We didn't have a long discussion.
The Chairman. Was he rather insistent that you give the concession
to S. & G. ?
Mr. Schixe. I don't recall wdiether he mentioned the S. & G., but
he gave me to understand that it would be best if we had the local out-
fit run it. I told some of our men there about it.
JNIr. Halley. Before you leave the conversation, what did you tell
Purdue ?
Mr. ScHiNE. I told him that I thought I would do as I saw fit. I
didn't think it was his job to tell m,e what to do. If he told me not to
have anyone, I Avould listen to him, but to tell me I should give it to
somebody that he liked, and not give it to the one he didn't like, I didn't
feel was right. So I just let it go.
Then I told it to some of our people there about the conversation and
nothing was done about it.
Later on a man by the name of Harold Furman and Erickson came
to see me, and they came in several times to see me. By the reports
I had that we were just infested with all these sneak bookmakers, we
decided to let Erickson and his associates have it.
Mr. Halley. And 3'ou negotiated a deal with Erickson ; is that right ?
Mr. ScHiNE. Yes. They had it, and after a little while, I don't
remember how long, maybe 2 or 3 weeks, they closed them up. Purdue
raided the place.
jMr. Halley. Just what happened ? Erickson came in and operated
the Cabana?
Mr. ScHixE. He was never there himself.
Mr. Halley. These people?
614 ORGANIZED CRIME IN INTERbTATE COMMERCE
Mr. ScHiNE. Yes. But tliey were not supposed to go around solicit-
ing business; they were supposed to stay right in the cabana and not
liave an}' charts or phones and just sit tliere. If anybody wanted to
come and do business with them, they are to take it; and if not, they
don't have it.
Mr. H ALLEY. They were operating just 2 of 3 weeks when they were
raided ?
Mr. ScHiNE. Yes. ;
Mr. H ALLEY. Who raided them?
Mr. ScHiNE. I think it was Purdue and the chief of police, a man
by the name of Short.
Mr. Halley. This same Pat Purdue was in on the raid ?
Mr. Schine. Yes.
Mr. Halley. Were they simply fined and allowed to proceed, or
were they closed up '^
Mr. Schine. Tliey were closed up, and then later they had some
understanding. I didn't know ; I had left town at that time. I don't
think they operated after that.
Mr. Halley. When they were raided, was the raid given unusual
publicity ?
Mr. Schine. It was on the front page, right across the page. It was
on the front page right across the seven columns.
Mr. Halley. I believe it was your observation that when other book-
makers were raided in other hotels there was no undue publicity 'i
Mr. Schine. Yes ; I observed that when other hotels were raided —
and it upsets me — small items appeared in the papers. It would be
maybe one column, 2 or 3 inches.
When the Roney Plaza was raided, it went across the front page.
Mr. Halley. Purdue, in effect, put them out of business?
Mr. Schine. Yes.
Mr. Halley. The following year, did you rent the concession to some
other bookmaker?
Mr. Schine. We didn't rent to Erickson any more, but we rented
to somebody who was supposed to be associated with the S. & G., and
that fellow
The Chairman. Who was that ?
Mr. Schine. His name was Heller.
Mr. Halley. May I hear you state for the record that the books
and accounts of the S. & G. show an operation during the years 1948
and 1949 at the Roney Plaza Hotel ?
Mr. Schine. Yes.
Mr. Halley. Closing, I think, in April of 1949. Is that when the
Plaza closed for the summer ?
Mr. Schine. I think so.
Mr. Halley. There are no other questions.
The Chairman. This short time when Erickson operated was
194e-47?
Mr. Schine. I think it was 1947-48.
The Chairman. Yes, 1947 and 1948.
Mr. Schine. Yes.
The Chairman. He was to pay you, I believe, $50,000?
Mr. Schine. No ; he actually paid $45,000.
The Chairman. Now, the previous caason you had had some pre
Hminary negotiations with S. & G. ?
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 615
Mr. ScHiNE. No ; we didn't.
The CiiAiRMAX. Three years previous you luid had some negotia-
tions?
Mr. SciiiNE. No; that was the newsstand I mentioned at the outset.
The Chairman. Yes.
Mr. SciiiNE. But I had no idea they were from S. & G., because
1 was new at that time in the business, and I had no knowledge of
syndicates or anything else.
They merely were supposed to run a newsstand, and when I found
out later that they intended to make book, I gave them the money
back, canceled the lease, but then they agreed to run the newsstand
only if we don't charge them rent, which we agreed to, and they had
a girl running the newsstand, but no representatives of the S. & G.
were there.
The Chairman. That was the $7,500 transaction, I believe ?
Mr. SciiiNE. Yes.
Mr. Gruber. And they stayed there only that 1 year.
The Chairman. They stayed there only 1 year.
Mr. SciiiNE. During the 3 years when we didn't have the so-called
bookmaking, we were offered all sorts of prices, but we turned every-
body down.
The Chairman. Mr. Schine, there is a discrepancy in your testi-
mony and that of John O'Rourke at West Palm Beach as to who
did the negotiations for Boca Raton. He is saying that he dealt
directly with you, and I think you said the arrangements were made
through a manager.
Do you want to clarify that, or make any additional statement?
Mr. Schine. I checked on that yesterday. I called the man who
was the manager at that time.
The Chairman. What was his name ?
Mr. Schine. Henry Williams. He said that the negotiations w4th
O'Rourke were made with him the first year, and he hadn't seen
Erickson there, and I hadn't seen Erickson there either.
As a matter of fact, Erickson never appeared personally anywheres,
not even in the Roney Plaza ; but the first year it was operated by
O'Rourke himself, I believe.
Mr. Halley. What would you say about the second year?
Mr. Schine. The second year I think Erickson was in with him.
The Chairman. Did you discuss the matter with Erickson to get
him in, or with O'Rourke, to cause him to come into the partnership ?
Mr. Schine. I do not recall just how it happened, but I found
that they were both in it.
The Chairman. The second year, anyway?
Mr. Schine. The second year.
Mr. Hallet. Just to clarify, you have corrected your testimony in
that in the negotiations for the Roney Plaza you did personallj^ deal
with Erickson and make the arrangements?
Mr. Schine. I dealt with Erickson and his associate.
Mr. Halley. Thank you.
The Chairman. Any questions. Senator Hunt?
Senator Hunt. No, thank you.
The Chairman. Anything else, Mr. Halley?
Mr. Halley. No.
68958— 50— pt. 1 40
616 ORGANIZED CRIME IN INTERSTATE OOMMERCE
The Chairman. Thank you very much, Mr. Schine.
(Witness excused.)
The Chairman. All right, Mr. Johnston, will you come around?
You were sworn yesterday ?
Mr. Johnston. Yes.
rUETHER TESTIMONY OF WILLIAM H. JOHNSTON, JACKSONVILLE,
FLA., ACCOMPANIED BY JOHN W. PEHLE AND LAWRENCE S.
LESSER, ATTORNEYS, WASHINGTON, D. C.
The Chairman. We will continue on.
Mr. Johnston. I don't know whether it makes a lot of difference,
but there are a couple of slight errors in this record.
The Chairman. In the copy of the record of yesterday ?
Mr, Johnston. Yes.
The Chairman, We will be glad to have you clarify any error you
find.
Mr. Johnston. On page 22 and page 849. I don't know which
number you go by.
Mr. Halley. The right-hand corner, the top right-hand corner.
Mr. Johnston. 849. It says in there on line 7 :
He told me that if Mr. Schanz won the second primary, lie would help me
raise the money.
I don't believe I said that, but I said that if Mr. Schanz was not in
the second primary and had not won.
The Chairman. That correction will be noted.
Do you have that, Mr, Kice?
Mr. Rice, Yes.
The Chairman. What is the other correction?
Mr. Johnston, I spoke of the other one, I don't know whether it
makes any difference. When you and I were discussing relative to
getting back to Chicago, I said I had been invited to a dinner in the
record. It was really that I was giving a dinner.
One of the boys remarked that if I didn't get back there to grab
the check, they would think that I was being invited. That is the
only thing.
The Chairman. So you were giving the dinner and not invited to
the dinner?
Mr. Johnston. That is correct.
The Chairman, All right, sir. How many were you having for
that dinner?
Mr. Johnston. About 60,
The Chairman. Who are they?
Mr. Johnston, Friends of mine. Every year the all-star football
game, most of the newspaper sportswriters of that area there go to
the game and we have dinner at the Blackstone with my friends before
we go to the game.
The Chairman. That is an annual event?
Mr. Johnston. An annual event.
Mr. Halley, Is Harry Russell going to be at the dinner.
Mr. Johnston. No, sir.
The Chairinian. How about Mr. John Patton?
Mr. Johnston. John Patton, I don't know; I hadn't invited liim.
ORGANIZED CRIME IN INTERSTATE COMMERCE 617
The Chairman. You hadn't invited him?
Mr. Johnston. No. They haven't been to any of my dinners.
Mr. Halley. You have known John Patton ?
Mr. Johnston. For many years.
Mr. Halley. When did you first meet John Patton ?
Mr. Johnston. I met John Patton in 19 — I would say, around 19Jj2.
I don't remember. It was the first yeai' that Sportsman's Park opened.
Mr. Halley. What was your association witli Sportsman's Park
at that time?
Mr. Johnston. I started Sportsman's Park when they first opened
as auditor there in the racing department.
Mr. Halley. That was in 1932?
Mr. Johnston. I believe that is the year, and possibly it was 1931
or 1932.
]\Ir. Halley. What had been your occupation previously?
Mr. Johnston. I was in the real-estate business.
Mr. Halley. For how many years ?
Mr. Johnston. About 5 or 6 years.
Mr. Halley. What other occupations had you been in previous to
going into Sportsman's Park?
Mr. Johnston. That was the only occupation that I had been in,
the real-estate business, up to that time.
Then I went to Sportsman's Park. How I got connected with
Sportsman's Park was in this manner.
Mr. Halley. For instance, I would like to be sure. Is the real-estate
business the only other business that you have been in ?
Mr. Johnston. The only other business I have ever been in.
Mr.. Halley. When did you first enter the real-estate business?
Mr. Johnston. In 1921.
Mr. Halley. Were you in business for your own account, or working
for somebody?
Mr. Johnston. In my own account.
Mr. Halley. From 1921 until when?
Mr. Johnston. Until about 1930.
Mr. Halley. Under what names did you operate ?
Mr. Johnston. Under the East Side Kealty Co.
Mr. Halley. East Side Realty Co. ?
Mr. Johnston. Yes.
Mr. Halley. In Chicago ?
Mr. Johnston. In Chicago.
Mr. Halley. Is that real-estate company still in existence?
Mr. Johnston. No, sir.
Mr. Halley. When did that go out of business?
Mr. Johnston. That went out of business in 1930 or 1931.
Mr. Halley. Now, from there, did you go to Sportsman's Park?
Mr Johnston. That is correct.
Mr. Halley. You had no business in between ?
Mr. Johnston. No business in between whatsoever.
Mr. Halley. How did you happen to go to Sportsman's Park?
Mr. JopiNSTON. A sportswriter by the name of Walter Pierce. I
would like to give the story in detail.
The Chairman. Go ahead.
618 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Johnston. A sportswriter by the name of Walter Pierce came
to me and he knew that I had handled some property for the Shed
people. He asked me if I knew Mr. Shed, and I saicl "Yes." They
wanted to obtain an option on a lease on the old Robey Race Track.
The Robey Race Track is situated on the border of Illinois and Indiana.
I was successful.
Walter Pierce took me to a banker by the name of Staver, who
was at 55 Michigan Avenue in Chicago at that time. The bank has
since that time closed. Mr. Staver negotiated with me and told me
that he wanted to get this option on the lease. I was successful in
getting it.
I met Eddie O'Hare in the negotiations for this lease. At that time
he was building in the Sportsman's Park race track. Walter Pierce,
who was a sportswriter, was going to be publicity man for the Na-
tional Jockey Club for Sportsman's Park.
Mr. Halley, Do you know whether Walter Pierce is related to
Ralph Pierce?
Mr. Johnston. No relation whatsoever.
Mr. Halley. You do know Ralph Pierce ?
Mr. Johnston. I do not know him except by reputation. I never
saw him. Walter Pierce is the grandson of J. Alderman Pierce, who
was formerly counsel of the Courier Journal in Louisville.
At that time, this was during the depression, there was nothing
being done in real estate. Opening this new race track I thought
would be an opportunity for me to get into a new business. I secured
the position as auditor handling all the accounts for all the horsemen.
I did a pretty good job of that and the first thing I Iniew I was handling
the staff in the front office.
I think it was about a year after that I met Mr. Patton at the track.
• Mr. Halley. You are referring to John Patton ?
Mr. Johnston. John Patton.
Mr. Halley. Was Patton also connected with the track 'i
Mr. Jolinston. Mr. Patton was secretary and treasurer of the track.
Mr. O'Hare was president.
Mr. Halley. Who w^ere the people who were the principal stock-
holders and persons having an interest in the track at that time ?
Mr. Johnston. At that time I did not know, but since that time I
have checked the records and being president of it right now, I have
checked the records and at that time the principal stockholders were
Edward J. O'Hare and John Patton. There were numerous others
that held small amounts. The biggest stockholder was O'Hare.
Mr. Halley. O'Hare and Patton were both reputed to be Capone
gang members ?
Mr. Johnston. I wouldn't say that. Mr. O'Hare I knew from 1931
until the time that he was killed. I have never seen Mr. O'Hare with
anybody other than the best people. In Miami his friends w^ere the
best people in Miami, and the same in Chicago.
I don't believe that if Mr. O'Hare had died a natural death he would
be put there.
Mr. Halley. Did you ever hear of a Laramie Kennel Chib?
Mr. Johnston. No, sir; the Laramie Kennel Club was out of ex-
istence long before.
I understand there was one at one time.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 619
Mr. Halley. Is it not a fact that Patton, O'Hare, and Jake Giizik
were together at one time in the Laramie Kennel Ckib'^
Mr. Johnston. I don't know.
Mr. Halley. Have you ever heard of the Hawthorne Kennel Club ?
Mr. Johnston. Yes, sir.
Mr. Halley. Was that not known as the Capone Do<i; Track?
Mr. Johnston. The Hawthorne Kennel Club was Sportsman's Park
originally, and it was rebuilt over. The PTawthorne Kennel Club's
books don't show that Mr. Guzik or anybody in the Capone family
owned any stock.
Mr. Halley. Of course, those fellows do not show up in the books,
do they ?
Mr. Johnston. Who was holding it?
Mr. Halley. Is that not the reason why they have such a difficult
time proving relationship between these gangsters and these other
people?
Mr. Johnston. All I can go by is the records. Let us take a look
at the records. Who can have been holding the stock in these places?
Mr. Halley. Which of the fine friends of Eddie O'Hare chased him
with a sawed-off shotgun and blew his brains out?
Mr. Johnston. I wouldn't know, but as I say, I don't know why
Eddie O'Hare was killed and I don't know why it was done. I
think in Irey's book it was stated that Mr. O'Hare was an undercover
man for the Government.
Mr. Halley. Well, he might have at one time been doing some
work to help the Government ; that may or may not be so. On that
we will just have to wonder, but let us look at the record.
Did not Mr. O'Hare, in the period just before his assassination,
live in fear for his life?
Mr. Johnston. He never acted that way when I was around.
Mr. Halley. Did you not tell the Chicago newspapers that he
cleaned a gun, loaded it, put it in his pocket before he walked out of
Sportsman's Park to go to his death?
Mr. Johnston. I did not.
Mr. Halley. It was so reported, was it not?
Mr. Johnston. There was a report something like that. They
had asked me if there were ever any guns around Sportsman's Park,
and I said there was one in the office there in the desk drawer. Had
I ever seen Mr. O'Hare with it? And I said I saw him cleaning it
one day. In fact, the day Mr. O'Hare was killed I left to come here
to Washington and I was supposed to meet him in Miami.
Mr. Halley. There would be some reason to believe that he had
some associations with some people other than the very fine people
you have been referring to ?
Mr. Johnston. Well, I don't know what reasons you would give,
Mr. Halley. Why would he be connected with them if he wasn't
interested in the track ?
Mr. Halley. First, he was connected with John Patton?
Mr. Johnston. We were on Mr. O'Hare, and then we will get to
Mr. Patton.
Mr. Halley. We are talking about O'Hare because Patton was his
associate and that is the only way we can get to the connection.
620 ORGAJSriZE'D CRIME IN INTERSTATE OOMME'RCE
Let us look at John Patton. Was he not a member of the Capone
gang?
Mr. JoiixsTON. Not to my knowledge.
Mr. Hallet. Was he not arrested in Capone headquarters in 1925?
Mr. Johnston. I don't kno^Y. I haven't known him since 1925. I
have known John Patton since 1931 or 1932 until the present time,
and Mr. Patton has been either at the race tracks or on his farm. I
have never seen him with anybody or connected with anybody.
Now. let me tell you, Mr. Halley, it may be true; I don't know, that
he did something in 1925 or 1926. That is 25 years ago. But I know
as far as the present time and as far as I have known him he has had
no connection along those lines.
Mr. Halley. Well, do you know Joe Polizzi?
Mr. Johnston. I have never seen him.
Mr. Halley. Have you ever heard of him?
Mr. Johnston. I have heard of him, but never met him.
Mr. Halley. He was a Capone gangster, was he not?
Mr. Johnston. I don't know.
Mr. Halley, Did you know Frank Nitti ?
Mr. Johnston. Yes; I have met Frank Nitti.
Mr. Halley. Was he not a Capone gangster?
Mr. Johnston. The newspapers said he was. I believe that he was.
I don't say that he wasn't. But, Mr. Halley, I w^ant to bring out one
thing; that I am in the racing business. I have been on the race track
practically every day since 1931 until today.
You gentlemen in public life know that I possibly have met a
hundred thousand people in that time. I meet hundreds every day
because it is my motto. Because I met someone, he is not an associate
of mine.
Mr. Halley. We are talking particularly about John Patton and
Ed O'Hare, with whom you were intimately associated at Sportsman's
Park.
Mr. Johnston. That is right.
Mr. Halley. In fact, you succeeded Ed O'Hare as president of
Sportsman's Park?
Mr. Johnston. No.
Mr. Halley. You eventually succeeded him?
Mr. Johnston. Yes.
Mr. Halley. Do you know Robert Larry McCullough?
Mr. Johnston. No. Rabbit Larry McCullough?
Mr. Halley. Robert.
Mr.. Johnston. Yes, I know Robert McCullough.
Mr. Halley. He works for you, does he not ?
Mr. Johnston. He works for the Miami Kennel Club.
Mr. Halley. He is the chief of police there ?
Mr. Johnston. He is a detective there.
Mr. Halley. Is he not a former Capone gangster?
Mr. Johnston. He was in there when I took over the Miami Beach
Kennel Club.
Mr. Halley. With the statement you have been making about the
importance of having fine associates who were above reproach and the
importance of keeping a race track clean, it would seem to me that you
would have been aware, as has been advertised in the press, that on
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 621
April 27, 1925, John Patton, Robert McCullough, Joe Polizzi, Frank
Nitti, and some other Capone gangsters were all arrested in a raid
on the Capone headquarters which would seem to put them all together
at least on that day.
Mr. Johnston. I don't know about that, Mr. Halley, but Robert
Larry McCullough
Tlie Chairman. Did you see that in the papers? It was widely
advertised.
Mr. Johnston. I saw it in the Miami papers since the scandal came
out.
The Chairman. You were living in Chicago since 1925, and you
knew that that raid and arrest took place?
Mr. Johnston. No, sir; I never knew of any such raid or arrest
until these things came out in the paper, Senator.
Mr. Haixey. Did you not ever talk to John Patton in your long
years of association about his background and past?
Mr. Johnston. I have.
Mr. Halley. Did you not talk to him about his background during
the years at Sportsman's Park?
Mr. Johnston. Mr. Patton told me that he had never been arrested ;
that he was the mayor of a town called Burnham ?
Mr. Halley. He was known as the boy mayor of Burnham ?
Mr. Johnston. He was known as the boy mayor of Burnham.
He said that he was known as a liberal.
Mr. Halley. What do you mean by that ?
Mr. Johnston. He was known to be liberal.
Mr. Halley. It is pretty common knowledge that Burnham was
a suburb of Chicago and was the center of the Capone syndicate of
vice and booze ?
Mr. Johnston. That was 1925.
Mr. Halley. You had no doubt about that ; you must have known
about Burnham as an active citizen of Chicago?
Mr. Johnston. I knew that Burnham was there, but I didn't know
John Patton was there. I never around gambling places, Mr. Halley,
in 1925-26.
Mr. Halley. You are a man who makes a lot of friends, gives din-
ners for 70 people, and seems to have a pretty good idea of who is
who?
Mr. Johnston. That is correct.
Mr. Halley. You were in the real estate business from 1920, was
it, to 1930?
Mr. Johnston. Yes, sir.
Mr. Halley. Then you had sufficiently good connections to tie up
with Sportman's Park as auditor; is that right?
Mr. Johnston. That is right.
Mr. Halley. There you found John Patton and Eddie O'Hare ; is
that right?
Mr. Johnston. Yes.
Mr. Halley. Do you mean to say that when 3^011 got there you did
not notice that John Patton had been the boy mayor of Burnham ?
Mr. Johnston. Mr. Halley, from 1932 until after the time that Mr.
O'Hare was killed, there was never anything in the papers about those
people.
622 ORGANIZED CRIME! IN INTERSTATE OOMME'RCE
Mr. Halley. You shared offices with these people, ran a business
with them ; you must have had social contacts and daily conversation.
Do you mean to say that you never heard that Patton was the boy
mayor of this vice and gambling headquarters for the Capone crowd
in Burnham ?
Mr. Johnston. I knew he was mayor of Burnham.
Mr. Bailet. You knew the reputation of Burnham ?
Mr. Johnston. At that time Burnham had been closed up long
before that time.
Mr. Halley. But you knew he had been in there, and he was the
fellow who had to be closed ?
Mr. Johnston. I knew he had been mayor of Burnham ; yes ; I did.
Mr. Halley. And that if it was closed he was the fellow against
whom the closing took place ?
Mr. Johnston. That may be, but the only thing I knew about Mr.
Patton was that from the time I met him, and from that time on I have
always found him to be a gentleman. I have never seen him around
with anybody.
Let us get to Mr. O'Hare.
Mr. Halley. Let us hear about him.
Mr. Johnston, From 1930, from that time on. the only people I
ever saw — I was more friendly with Mr. O'Hare than I was with Mr.
Patton all during that time. The only people I met him with were
the best people.
Mr. Halley. Who were his best friends ?
Mr. Johnston. His best friends, for example, Daniel Mahoney,
Miami, the publisher of the daily paper.
Mr. Halley. Who else ?
Mr. Johnston. He belonged to the Illinois Athletic Club, and his
friends were doctors there.
Mr. Halley. Let us have the names of some of his friends.
Mr. Johnston. You want all these people's names dragged through
this, I don't think it necessary.
Mr. Halley. Did you know that he was a friend of Jake Guzik?
Mr. Johnston. Never.
Mr. Halley. Have you met Jake Guzik ?
Mr. Johnston. I have seen him.
Mr. Halley. Did you talk with him?
Mr. Johnston. What is that?
Mr. Halley. Did you talk to him?
Mr. Johnston. Yes; I met him.
Mr. Halley. Have you met any of the Fischetti's ?
Mr. Johnston. I believe I met one one time, on a track, a young one.
Mr. Halley. Rocco?
Mr. Johnston. No. It was a young fellow.
The Chairman. Charles, Joe, Eocco?
Mr. Johnston. Joe, I believe. I think I met one of them one time
on the track.
Mr. Halley. You talked to him, too ?
Mr. Johnston. I was introduced to him once on the track.
Mr. Halley. Have you ever met Tony Accardo ?
Mr. Johnston. No.
Mr. Halley. You never met him at all ?
ORGANIZED CRIME IN INTERSTATE (X)MME'RCE 623
Mr. Johnston. I iieA^er met Tony Accardo.
Mr, Halley. Were you ever on his boat ?
Mr. Johnston. I never knew he had a boat.
Mr. Halley, "Were you ever on a boat that Harry Russell and the
S. & G. bought from Accardo 1
Mr. Johnston. No.
Mr. Halley. Let us get back to O'Hare. Did you ever see him
with any of these people ?
Mr. Johnston. Never.
Mr. Halley. You never saw him with Guzik?
Mr. Johnston. Never.
Mr. Halley. Or the Fischetti's?
Mr. Johnston. Never in my life.
Mr. Halley. Or wdtli Accardo?
Mr. Johnston. Never.
Mr. Halley. Rocco Fischetti?
Mr. Johnston. No, never.
Mr. Halley. Joe Fischetti?
Mr. Johnston. Never,
Mr. Halley. Charles Fischetti ?
Mr. Johnston. Never.
Mr. Halley. Have you ever met Ralph Capone ?
Mr. Johnston. Never.
Mr. HxVLLEY. Have you ever been introduced to him ?
Mr. Johnston. Never.
Al Capone was in jail before I met these gentlemen.
Mr, Halley, You mean Al?
Mr, Johnston, Al.
Mr. Halley. With reference to O'Hare, would you say that you
consider him to be a perfect gentleman ?
Mr. Johnston. Any time I have seen him I considered that;
yes.
Mr. Halley. Did you ever wonder wliy he kept a pistol in his desk
and ke])t it in operating condition ?
Mr. Johnston. I don't know that he kept it in operating condition.
I never thought any more about it. There was a lot of money around
that race track and it wnis nothing unusual to have a gun around.
Mr. Halley. You had guards?
Mr. Johnston. Yes ; we had guards there.
Mr. Halley. What do you think about a close business associate
whom you see sitting at his desk and cleaning his pistol? Does that
give you any qualms aljout whether he is the perfect gentleman he
appears on the face ?
Mr. Johnston. No; I didn't think anything of it at the time.
Mr, Halley, Did you begin to think anything of it when he was
killed by a shotgun blast ?
Mr, Johnston. It worried me.
Mr. Halley. Did you make any investigation to find out why he
was killed ?
Mr. Johnston. Yes.
Mr, Halley. What did you do ?
Mr. Johnston. I tried to find out; I went to the State's attorney.
Mr. Halley. Wliat did you learn?
624 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Johnston. Nothing. I hit a blank wall.
Mr. Halley. Now, you went in there as auditor for this Sportsman's
Park track, and you were associated there with Patton and O'Hare?
Mr. Johnston. That is correct.
Mr. Halley. You at least knew that Patton had been mayor of
Burnham ?
Mr. Johnston. That is correct.
Mr. Halley. You knew the reputation of Burnham ?
Mr. Johnston. I knew tlie reputation of Burnham ?
Mr. Halley. The city of Burnham?
Mr. Johnston. The reputation of the city of Burnham at the time
I was there was as good as any city in the country.
Mr. Halley. That was after it was closed?
Mr. Johnston. I never knew Burnham was open. I never knew
that Patton was mayor of Burnham until the newspapers said he was.
Mr. Halley. You testified that he was mayor for 40 years?
Mr. Johnston. That is right.
Mr. Halley. So he nmst have been mayor at the time it was open ?
Mr. Johnston. That is right.
The Chairman. You knew that, did you not, Mr. Johnston ? You
knew that he had been mayor of this place at the time that you joined
up with him in Sportsman's Park?
Mr. Johnston. I didn't even give it a thought.
The Chairman. But you knew that to be a fact? Here was the
boy mayor of Burnham, where they operated, a town which was open,
and then they closed up and then a few years afterwards you went
into business with him in Sportsman's Park and you knew he was
the same fellow, did you not?
Mr. Johnston. In 1931 I was not going into business; I went to
work theie. In 1931 when I went to work at Sportsman's Park, there
was, starting at that same time, there were ever so many men who are
big men in this country today who were starting there. There was
Bob Shelley, whose father ran Churchill Downs and became one of
the greatest racing secretaries. One of the chief starters of the New
York tracks worked there. Fred Bixby, head of the Sugar Bowl
worked there. Are they all hoodlums because they worked there at
that time?
Mr. Halley. Do you not know that it was reported in the news-
papers at the time you went to work for Sportsman's Park that O'Hare
was running not only Sportsman's Park, but the Hawthorne Kennel
Club for Guzik, Nitti, and Al Capone?
Mr. Johnston. No, sir.
Mr. Halley. Did not the newspaper actually state that Al Capone
had so told the police ?
Mr. Johnston.' Not that I know of. I never seen it.
Mr. Halley. Was that not public knowledge throughout Chicago?
]Mr. Johnston. It wasn't. That was not public knowledge.
Mr. Halley. That the Hawthorne Kennel Club was actually a
Capone operation ?
Mr. Johnston. That was not common knowledge throughout Chi-
cago. None of this stuff was common knowledge, or ever came into
the newspapers until 1939 when Mr. O'Hare was killed.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 625
Mr. Halley. I can show you quotes going back to 19o0 in the news-
papers.
Mr. JoHNSix^N. I wish you would show them.
Mr. Halley. I can refer you to the Chicago Daily News, April 30,
1930, with a specific quote on that situation.
Mr. Johnston. I didn't see it. I suggest that you check the news-
jDapers. Also, Mr. Halley, I want to check a point on this. I don't
take, from the way that the newspapers in Miami have kicked my
name around in this last 3 or 4 weeks, I don't know that I take that as
being a fact, what they say.
Mr. Halley. Would you take it to be a fact if they reported that
Patton and Nitti and this Guzik and McCullough were all arrested in
the Capone headquarters in 1925 ? Would you take that to be a fact?
Mr. Johnston. If they proved it to me.
Mr. Halley. But you do not need proof as to the fine associates that
these people have ?
Mr. Johnston. I saw them myself.
Mr. Halley. But you have not named them. You named one, Mr.
Mahoney. Who were some of the fine associates of Eddie O'Hare?
Mr. Johnston. Well, some of them were prominent people m the
country.
Mr. Halley. Who, for instance, was an associate of Eddie O'Hare?
Mr. Johnston. Mr. Halley, why do you want to drag all this thing
through here?
Mr. Halley. Well, we have here credible reports, common knowl-
edge, that Eddie O'Hare's associates were Capone. Guzik, and Nitti,
and we have common knowledge as to Patton's work in Burnham and
the fact that Burnham was the headquarters for Capone and wide
open. That much we do have.
You said these people with whom he associated were very fine,
wonderful people, and 1 would like to know who they were and par-
ticularly who Eddie O'Hare associated with.
It may throw some light on who murdered him.
Mr. Johnston. If the chairman directs me to give these names, I
will give them.
The Ch^virman. Well, Mr. Johnston, you ha\e given one name;
so, if you have given one name, you might as well give some more.
Mr. Johnston. Well, there was a good friend of his, Mr. Gore,
publisher of a newspaper in Fort Lauderdale. He was a friend of
Mr. Farley's and a friend of Mr. Joe Martin. He was a friend of
doctors, lawyers. Dr. Nelson, Dr. Schmidt, one of the finest physicians
in Chicago, and they were close personal friends.
I could go on. I would have to think of the different people I met
with him. I was introduced to Mr. Mahoney by Mr. O'Hare and he
entertained me on his yacht.
The Chahiman. I think this should be said for the record so the
public will not get a misapprehension. You have mentioned a lot of
names, some I know and some I do not. We are not saying whether
Mr. O'Hare is a good man or a bad man, but a lot of bad men who
operate in higher places it later turns out that they might not have been
so good. It later turns out that they had many respectable friends.
We all know that is true.
626 ORGANIZED CRIME! IN INTEBSTATE COMMERCE
Even the known hoodlums, sometimes you find in prior years that
they have associations all the way up and down the scale, do you not ?
Mr. Johnston. Mr. Senator, the only point I am bringing out here
is that if what you say is true, if Mr. O'Hare wasn't, there were a lot
of bigger people than I that were fooled by Mr. O'Hare, and why should
I be condemned ?
The Chairman. The only difference is that you were out there work-
ing with him and you came along up the the ladder as business asso-
ciates and personal friends. In addition to being personal friends,
you were one of the three who had the principal part in the operation
of this business ; is that not correct ?
Mr. Johnston. ^ I had no interest in the business. I was working
there.
The Chairman. You did acquire an interest?
Mr. Johnston. That was after Mr. O'Hare died.
One more think I wanted to bring out while we are on O'Hare. It
has been said that O'Hare was a front for the Chicago mob at this
track, and so on, and so forth. The records will show that the entire
holdings of Mr. O'Hare went into the Northern Trust Co. in Chicago,
into a trust that he had created before he died, and that the trust, all
of the stocks and everything, were brought out of there and were sold
by the Northern Trust Co. of Chicago.
I think at that time if he had been a partner of anybody, it would
have been divulged, would it not ?
Mr. Halley. I very much doubt it.
Mr. Johnston. I don't know; I am just bringing these points out.
Mr. Halley. Let us get ahead with the rest of the people who were
associated with you. McCullough, then, is still a detective both in
your Miami Kennel Club and also up at Sportsman's Park?
Mr. Johnston. No, he doesn't work in Chicago in the summertime.
He works in Miami, and I believe he lives there.
Mr. Halley. Did he not work in Sportsman's Park for you for a
while?
Mr. Johnston. He did.
Mr. Halley. Has he not been known as a strong-armed man for the
Capone gang for a long time ? Is that not his reputation ?
Mr. Johnston. It may be, but not to my knowledge.
Mr. Halley. What makes you say it may be?
Mr. Johnston. I don't know.
Mr. Halley. You mean it is possible that all these people were
hoodwinking you ?
Mr. Johnston. It could have been.
There is one thing: Mr. McCullough was working at the Miami
Beach Club when I took over the INIiami Beach Kennel Club. His job
was to keep bookmakers and to keep pickpockets off that race track.
In 1944, at the end of the last administration, Mr. Henry Bainger.
who was secretary of the Florida State Racing Commission, wrote me
a letter commending me on the cooperation which I gave him and the
fine operation of the track.
In 1948, the end of the last administration, INIr. Watson, who was
secretary of the commission, did the same thing.
Now, let me ask you this, Mr. Halley: If you go into an institution
and a man is working there and that man is doing a good job, he is
ORGANIZED CRIME IN INTERSTATE COMMERCE 627
doing a good job, let iis say that he has a past and he has reformed
and is doing a good job and is living a clean life and no crime. Do
yon think I should fire him ? I ask that question.
Mr. Halley. I will just ask, then, if you do not mind. It was a
rhetorical question, I believe.
Mr, Johnston. Here is a man who you claim in 1926 had done some-
thing wrong. If a man had been sent to prison in 1926 and came back
and reformed and became a good citizen and was working well, and
you went into an institution that he was working in, he was living a
clean life, doing a good job, being commended, would you fire him^
Mr. Halley. Since you persist in making a speech, it is perfectly
obvious that the whole Capone group, or this part of it, was in Sports-
man's Park, in the various kennel clubs in Florida, and that when
you took it over yon took it over with the knowledge that O'Hare was
there, including Patton and McCullough. How about Shumway?
Was he there when you took it over ?
Mr. Johnston. Yes, sir.
Mr. Halley. Wliat about Shumway?
Mr. Johnston. What did Shumway ever do ? Was he arrested ?
Mr. Halley. Was he not a witness in the Government's tax case
against Capone and did he not say he was a Capone employee ?
Mr. Johnston. It might be.
Mr. Halley. What do you mean by it might be?
Mr. Johnston. I say it might be, only because you say so. I don't
know.
Let's say that he was.
The Chairman. Well, Mr. Johnston, did you see that? Did you
know that?
Mr. Johnston. No. All this stuff here has come out since this
came up.
Mr. Halley. You mean you were just a babe in the woods all this
time ?
Mr. Johnston. I wasn't a babe in the woods. It was a case of a man
working there and doing a good job. He not only worked for me, he
works for Arlington Park and Washington Park. He works for every
track in the country. Were they all Capone owned?
Mr. Halley. He is the mutual manager at Miami?
Mr. Johnston. That is correct. He don't only work for me, that is
his occupation. He goes from race track to race track, and he is a
good man.
Mr. Halley. How about Edward Crumley ? Do you know him ?
Mr. Johnston. Edward Crumley ; yes, sir.
Mr. Halley. What is his position ?
Mr. Johnston. He works at the National Jockey Club as track
superintendent.
! Mr. Halley. Sportsman's Park?
1 Mr. Johnston. At Sportsman's Park.
! Mr. Halley. Is he not also at the Miami Beach Kennel Club ?
Mr. Johnston. No.
Mr. Halley. Was he ever connected with it ?
Mr. Johnston. No.
Mr. Halley. He works for you just at Sportsman's Park?
Mr. Johnston. He is the track superintendent ; yes.
628 ORGANIZED CRIME IN INTERSTATE OOMMERCE
Mr. Halley. How about David Kine ? . , .
Mr. Johnston. David Kine works in Miami Beach m the winter-
Mr. Halley. Was he not arrested in Chicago and indicted with
Shnmway and Eddie O'Hare? • ^ ^i
Mr. Johnston. I talked to Davie Kine when that came mto the
paper. . , .
Mr. Halley. Wlien did that come mto the paper (
Mr Johnston. When this stuff started out here m Miami.
Mr. Halley. You mean these fellows were indicted m Chicago m
1929 and you did not know about it? n i -n
Mr Johnston. Mr. Kine wants to come before you and he will say
that he never was indicted. Davie Kine is a mutual clerk He is an
odds man: he works on every race track around there. He ^yorks in
Washington Park, and different places. You were insinuating that
we kept a Capone man on. • ^ tv/t oi
As I understand the charge that you are making against ]\lr. fehum-
way is that he testified against Mr. Capone. If I had any strings on
Capone, or he had on me, is it likely that Shumway would be working
in that track? . i^^„j
Mr Halley. We have to find out where he was previously employed.
Mr. Johnston. I don't know where you go, but you may take the
employees of any race track in the country and you will find that they
have skeletons in their closets 25 years ago. n • i, • v -^
But, if that man is leading a clean life and doing a good job, isnt it
a part of the American system that we shouldn't fire him so as to put
him back into crime again ? . . , , • i i. i •
I am not defending these things, but I don t think— you are taking
minor employees in these race tracks and trying to crucify me because
I don't go in and fire those men. I don't think that is a fair way ot
looking at this.
Mr. Halley. Do you know Hugo Bennett i
Mr. Johnston. Yes, sir.
Mr. Halley. Wlio was he?
Mr. Johnston. He is the auditor.
Mr. Halley. Where? , ^x • -■ -r i r^i \ a
Mr. Johnston. He is the auditor of the National Jockey Club and
the Miami Beach Kennel Club. . ^ ^-e
Mr. Halley. Was not Bennett also the personal accountant ot
'^^Mr Johnston. No, I don't think he was. Bennett started at Sports-
man's Park at the same time as I did. He startled there and we worked
un together. I believe that he may have made a return form out at
one time or another, but he was never his auditor because he started
the same time I did. . <.• ,„ _;fU
Mr. Halley. Was not Bennett also a close associate operating with
the Capone crowd ? . i ..i i . t .i;^! oi.rl
Mr. Johnston. Never. Bennett started work there when I did and
Bennett has no more stain on him than I have.
Mr. Halley. Did he not ever work for Patton ?
Mr. Johnston. Never.
Mr. Halley. Down in Burnham?
Mr. Johnston. Never.
Mr. Halley. You said he made out a tax return «
ORGANIZED CRIME' IN INTERSTATE COMMERCE 629
Mr. Johnston. While he was in Sportsman's Park he may have done
somethm^r for him. If yon are Avorking in a place snch as he was
and Patton was the boss and came in and asked him to do a job, he
may have done something for him ; I don't know. Bnt he was never
an employee of his. He was an employee of the Jockey Club.
Mr. Halley, Starting when?
Mr. Johnston. He started about 2 or 3 weeks after, or before I
did. We both started when the race track was first built there.
Mr. Halley. Who took him on ? At that time who was running the
Sportsman's Park?
Mr. Johnston. Eddie O'Hare.
JNIr. Halley. Did he take on Bennett?
Mr. Johnston. I imagine so.
Mr. Halley. At that time did he hire McCullough ?
Mr. Johnston. I don't know. At that time I don't know who
originally hired ^McCullough.
Mr. Halley. But O'Hare was the boss?
Mr. Johnston. O'Hare was the boss.
Mr. Halley. He must have been the one who hired Patton?
Mr. Johnston. I think they were more or less partners. They
both owned interest in the track.
Mr. Halley. How did you get to be the boss of Sportsman's Park?
How did that develop ?
Mr. Johnston. How did it develop ?
Mr. Halley. Yes.
Mr. Johnston. In 1939 when O'Hare was killed, at that time I was
manager. Northern Trust Co. and I had helped the Northern Trust
Co., was friendly with them. I got a fellow by the name of Keeshin
who was m the trucking business there.
The Chahjman. What is the name ?
Mr J9HNST0N. Jack Keeshin, K-e-e-s-h-i-n. We are talking about
the National Jockey Club at Sportsman's Park. The late Charles
W. Bid well, who owned the Chicago Cardinal football team, I <Tot
them together to purchase this stock. I agreed with them that if and
when I got an opportunity and got enough money to buy a third
interest, I was to get one-third of it.
Mr. Keeshin went back on that and never gave it to me In 1945
I was 111 there as manager. I kept pressing that I had the money and
was ready to buy.
Mr. Halley. Had Keeshin bought it at that time?
Mr. Johnston. Yes, and he had operated it 3 or 4 years.
JNIr. Halley. Did he own it exclusively, or did he have a lot of
associates ?
Mr. Johnston. He had a lot of associates, stocldiolders. He had
a lot of stock.
Mr. Halley. Wlio were the stockholders ?
Mr. Johnson. Lawyers, doctors; very prominent people around
Senator Hunt. What was the purchase price?
Mr. Johnston. From whom?
Senator Hunt. The trust company.
^oQo^?? '"'^u'*"'- w^-"" ?"''l^ company. At the time they sold it back
m 1939 they bought it for $28 a share, I think, was the average price.
benatorHuNT. Capitalize that. How many shares ?
630 ORGANIZED CRIME IN INTERSTATE OOMMERCE
Mr. Johnston. It was capitalized for $400,000, I believe. Now,
that is not when I purchased. I was supposed to purchase at $27
or $28 per share.
In 1947 he went back on that and we were going to be in a lawsuit
and he agreed to sell. When I bought it, I bought it at $160 per share.
Senator Hunt. What is the total purchase price? In other words,
what did you put into it?
Mr. Johnston. I put two-hundred-thousand-odd dollars in when
I bought it. The total purchase price that we gave Keeshin was eight
hundred or nine hundred thousand dollars.
The newspapers had the figures, and I will give them to you at
any time.
^ly brother and I and Bidwell. We agi'eed that we would buy
Keeshin out and divide it. That was in 1946, and that was when I
got into the National Jockey Club. I paid $249,000 or something like
that, for my interest.
Mr. Halley, Prior to that you owned no stock in the club at all?
Mr. Johnston. Prior to that time I had 40 shares. I was supposed
to purchase this. I was supposed to have been able to purchase part
of Keeshin's for making this deal and running the race track. Kee-
shin didn't know anything about running the I'ace track.
Mr. Halley. What had been your salary as manager of the club?
Mr. Johnston. I was getting eight or nine thousand for the 30-day
season.
Mr. Halley. What do you mean for the 30-day season?
Mr. Johnston. That is what we ran, 30 days a year.
Mr. Halley. Wliat other businesses did you have during that
period ?
Mr. Johnston. Well, I was running the dog tracks in Florir'a.
Mr. Halley. When did you start running the dog tracks in Florida?
Mr. Johnston. In 1934.
Mr. Halley. In 1934?
Mr. Johnston. Yes.
Mr. Halley. At what salary did you start at Sportsman's Park
back in 1931 ?
Mr. Johnston. I think I was getting $100 a day. The first job
I got there, in other words. I don't know. That is far back.
Mr. Halley. Did you do any other work during that period?
Mr. Johnston. Did I do any other work?
Mr. Halley. Yes.
Mr. Johnston. That winter I went to Miami Beach and worked the
Miami Beach track.
Mr. Halley. What track ?
Mr. Johnston. The Miami Beach Kennel Club. ,i
Mr. Halley. Who then owned it? \\i '
Mr. Johnston. Mr. O'Hare. ^^^/r
Mr. Halley. And you worked for him ?
Mr. Johnston. I worked for him at the Miami Beach.
Mr. Halley. What salary did you get at the Miami Beach Kennel
Club?
Mr. Johnston. I think I was getting twenty-five or thirty a night
there.
ORGANIZED CRIMEl IN INTERSTATE COMMERCE 631
Mr. Halley. Diiiiii<r those days while 3^)11 were at Miami Beach,
did you ever meet Al Capoiie?
Mr. JoiiNSTox. Never.
Mr. PIallet. Did you ever see him at the Kennel Club ?
Mr. Johnston. He was in jail at that time.
Mr. Halley. Was he in jail when you lirst Avent to Florida ?
Mr. Johnston. Yes.
Mr. Halley. Did you ever meet any of his brothere, Joe or Kalph
Capone ?
Mr, Johnston. Never.
Mr. Halley. Not even in Florida ?
Mr. Johnston. Not even in Florida.
Mr. Halley. How did you oet into the management of the Miami
Beach Kennel Club ? Will you develop that ?
Mr. Johnston. I first became manager of the Jacksonville Kennel
Club.
Mr. Halley. "Wlio gave you that job ?
Mr. Johnston. O'Hare gave me that.
Mr. Halley. Wlio built it?
Mr. Johnston. O'Hare built it.
In 1934 I went to Jacksonville and built the Jacksonville Kennel
Club and became manager there and did a fairly good job. I didn't
get into the Miami Beach Kennel Club until in 1939 when the North-
ern Trust Co. was selling these assets. As I told you a minute ago,
I made a deal with Keeshin and got him into the National Jockey Club.
The reason I didn't go into the National Jockey Club myself at that
time "'.';as because I didn't have the funds to go into that and the dog
clubs.
Mr. jHalley. The National Jockey Club ?
Mr. -^Johnston. Yes,
Mr. Halley. The Miami Beach Kennel Clnb ?
Mr. Johnston. That is correct.
Mr. Halley. The Jacksonville Club ?
Mr. Johnston. The Jacksonville Kennel Club.
Mr. Halley. What other clubs were there, or tracks ?
Mr. Johnston. The Associated Outdoor Club of Tampa, Fla.
Mr. Halley. Was that also an O'Hare operation ?
Mr. Johnston. No, that wasn't.
Mr. Halley. lYlio ran that ?
Mr. Johnston. That was owned by a group. There was a Cincin-
nati group in there, Mr. Hayter, who owns the Aluminum Industries
in Cincinnati. It is one of the biggest corporations, and he owns the
biggest part of it.
Mr. ^Talley. "\^1io were some of the other people ?
"ohnston. Patton had an interest in there; O'Hare had an in-
i there. There w^ere tw'o groups. In 1939 I got fn interest
in Ux- ampa dog track.
Mr. X lALLEY. How did you acquire that ?
Mr. Johnston. I bought that from the Northern Trust Co.
Mr. Halley. What did you buy, O'Hare's interest ?
Mr. Johnston. That is correct.
Mr. Halley. "Wliat did you pay for it ?
Mr. Johnston. I don't know offhand right now, but the records, I
can get them for you any time.
68958— 50— pt. 1 41
632 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mv. Halley. Approximately what would you say you paid ? Over
$10,000?
Mr. Johnston. Let's see how much lie had in there. I can fifrure
it out.
Mr. Halley. Please.
Mr. Johnston. I can try to. I don't know offhand, but he had 31
shares. I think at that time it would cost me for that Tampa interest
around seventy-some hundred. I had better get the fiojures and jfjive
them to you, if you desire them, because two groups bought at one
time and another one later.
Mr. Halley. When did you first acquire an interest in the Miami
Beach Kennel Club?
Mr. Johnston. Around about the 3d of March 1941.
Mr. Halley. AVliat did you pay for that interest ?
Mr. Johnston. I would have to get you the figures. The only thing
I have here on this is that in 1941 there were two or three groups in
Miami. Maybe some of my trouble is coming from one of these groups
that tried to purchase this Miami Beach Kennel Club stock. The late
Lt. Comdr. Edward H. O'Hare was Eddie's son, who got the Congres-
sional Medal of Honor. You probably heard of him. He was alive
at that time and he did not want the Northern Trust Co. to be selling
it to these other people. He said that if anybody' was entitled to it, I
should be.
I purchased my interest and around about the month of March, I
sent Edward O'Hare, transferred the money up there to him March
1941, to Edward H. O'Hare for him to go in and put the deposit on it.
We got it on a time basis.
Mr. Halley. You got that on a time payment basis ?
Mr. Johnston. Yes, sir.
Mr. Halley. Would this be excessive, $10,000 ?
Mr. Johnston. I gave him $31,500.
Mr. Halley. You mean you paid that much to him on account?
Mr. Johnston, Yes. I transferred that amount. This is the record
where I transferred it from my account in Jacksonville to his account
in the First National Bank in Chicago.
Mr. Halley. That is in 1941 ?
Mr. Johnston. Yes, sir.
Mr. Halley. That would be just a part payment on the stock?
Mr. Johnston. Yes, sir.
Mr. Halley. Was the entire payment in excess of $100,000?
Mr. Johnston. I don't know, offhand, to tell the truth. I would
rather give you these figures at a later time, if you want them.
Mr. Halley. Of course we did subpena all your books and records,
did we not ?
Mr. Johnston. You did.
Mr. Halley, They turned out to be in Miami or Jacksonville?
Mr. Johnston, At the time I got the subpena last Wednesday, the
time they came in and served me, Mr. McKane said, "I will call tomor-
row and tell them that it will be very inconvenient for you to get all
this stuff here, tell them how you have tried to cooperate in getting
this subpena."
I believe he called a Mr. Rice and Mr. Rice called him back once or
twice, and then he called me and told me to call Mr, Rice. I called
ORGANIZED CRIME' IN INTERSTATE COMMERCE 633
Mr. Rice and explained it and Mr. Rice said to bring what I cou-ld. I
assured him that I would give anything else they wanted later.
Mr. Hallet, What have you been able to bring?
Mr. Johnston. All I had was what was up there. I have the list of
the stockholders of these race tracks.
Mr, Halley. What else do you have ?
Mr. Johnston. I had a letter here that I found in Michigan. In
1945_j^ii-ie 26, 19U
The CiiAiR3HAN. Before you go to that letter, may I see the list of
stockholders of that race track ?
Mr. Johnston. Which one do you want ?
The Chairman. Let us see Sportsman's Park, and the Miami Jockey
Club. You seem to have them all there, may I examine them ?
Mr. Johnston. I am sorting them out for you.
The Chairman. You have sheets for each one of them. May I see
them all?
Mr. Halley. Why do you not turn them all over to the chairman ?
Mr. Heller. Just a moment, please.
The Chairman. Here is the National Jockey Club and Sportsman's
Park.
Mr. Johnston. Here is the Miami Beach Kennel Club.
The Chairman. Now, I have Jacksonville. Do you have Tampa?
Mr. Johnston. You have Tampa there.
The Orange Park Kennel Club, I want to comment on the Orange
Park Kennel Club. The Orange Park Kennel Club is the only kennel
club which I have organized myself. This kennel club was organized
4 years ago in Jacksonville, Fla., and I submit to you the complete
stockholders' list at that time. There are the friends that I took into
the kennel club that I organized. (The list referred to was marked
"Exhibit No. 169,"' and appears in the appendix on p. 791.)
Mr. Halley. Wliere are all your income-tax returns and your per-
sonal vouchers, and so forth? Do you think you have had time to
work up these things that I regard as self-serving? Where are they?
Mr. Johnston. They are in Jacksonville.
Mr. Halley. Wliere ?
Mr. Johnston. At my home.
Mr. Halley. Where are your current records that your auditors
used to run your business today ?
Mr. Johnston. Mr. Halley, my business that I run today is corpora-
tions. Each corporation has their books in their offices. My private
affairs, the only thing that I get in the way of income, is salaries from
these places, plus my dividends.
Mr. Halley. Who prepares your personal income-tax returns ?
Mr. Johnston. Frank Cowles.
Mr, Halley. How do you spell that ?
Mr. Johnston. C-o-w-l-e-s. He is a certified public accountant.
Mr. Halley. Where is he located ?
Mr. Johnston. In Tampa, Fla.
Mr. Halley, Does he have any of your records ?
Mr, Johnston, He may have this last year's. He usually makes out
my return and sends it back to me and I send it in.
Haven't you got it in here? Someone must have it because they
asked for things here that they could only find out from the tax return.
634 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. Does anybody besides Frank Cowles make out your tax
returns ?
Mr. Johnston. One time I used a young fellow by the name of
Charles Blum, who was an internal-revenue man in Jacksonville.
Mr. Halley. Wlien did you use him ?
Mr. Johnston. Sometimes I have Cowles make it out, and sometimes
I have him.
Mr. Halley. Does Blum have any of your records ?
Mr. Johnston. No.
Mr. Halley. Who else has worked on your income tax ? [
Mr. Johnston. They are the only two.
Mr. Halley. Going back, say, to the year 1932, who else has worked
on your personal tax returns ?
Mr. Johnston. Nobody. My personal tax return, you see, is a
simple matter. The only thing that I have is salaries and dividends,
and they are all reported.
Mr. Halley. Now, where do you do your banking ?
Mr. Johnston. The Barnett National Bank in Jacksonville.
Mr. Halley. Do you have any other bank ?
Mr. Johnston. I have a small account in the Northern Trust Co.
in Chicago.
Mr. Halley. Do jou have any other accounts ?
Mr. Johnston. I think I have an account in Saugatuck, Mich.
Mr. Halley. What bank?
Mr. Johnston. The Fruit Growers State Bank.
Mr. Halley. Have you any other bank account in any other bank
w^hatsoever ?
Mr. Johnston. I don't think so.
Mr. Halley. Have you had any other bank accounts in the last
5 years?
Mr. Johnston. Yes.
Mr. Halley. Where?
Mr. Johnston. I think when I transferred some stuif up there I
did a little bit with the Continental Bank.
Mr. Halley. In Chicago?
Mr. Johnston. In Chicago. I had an account there for a while.
Mr. Halley. Have you had any other accounts in the last 5 years?
Mr. Johnston. Not that I know of.
Mr. Halley. Do you have any safe deposit boxes?
Mr. Johnston. Yes, sir.
Mr. Halley. Where?
Mr. Johnston. The Barnett National Bank in Jacksonville.
Mr. Halley. Do you have a safe deposit box anywhere else ?
Mr. Johnston. No.
Mr. Halley. You say your income is all in the form of salaries and
dividends from corporations?
Mr. Johnston. Well, I got an income from the corporations and
property. What I meant is that it all comes in on those forms and
I pay it to the Government.
Mr. Halley. You get checks?
Mr. Johnston. Yes.
Mr. Halley. Do you keep books ?
Mr. Johnston. No.
ORGANIZED CRIME IN INTERSTATE OOMMERCE 635
Mr. Halley. What do you do, deposit the checks ?
Mr. Johnston. I may cash or deposit the check. If I need the
iiiuiiey I take it, but the majority goes in the bank.
Mr. Halley. Let us say in the hist 5 years, would von say that sub-
stantially all of your income has come in the form of salaries or
dividends ?
Mr. Johnston. Yes.
Mr. Halley. That has been from regularly organized corporations?
Mr. Johnston. That has been from regidarly organized corpora-
tions.
Mr. Halley. Do those corporations invariably pay in the form of
checks ?
Mr. Johnston. That is correct.
Mr. Halley. Now, yesterday, we were talking about your contribu-
tions to the campaign of Fuller "Warren?
JMr. Johnston. That is right.
Mr. Halley. You mentioned that most of your campaign contribu-
tions were made in cash ?
Mr. Johnston. That is correct.
Mr. Halley. I asked you how that happened and you said you
habitually handled large sums of cash ?
Mr. Johnston. I don't think I said that. I didn't say large sums
of cash. I said I have always had some cash on hand.
Mr. Halley. We are talking about cash in excess of about $60,000?
Mr. Johnston. That is right.
Mr. Halley. Tliat you testified you handed over in this campaign ?
Mr. Johnston. Yes, sir; that is true.
Mr. Halley. I wondered how that would come into your hands
in the ordinary course of the business you described.
Mr. Johnson. I would possibly cash checks and put it in the box.
My records are clear for the income tax for anybody to check. I am
a very simple man to check, because every income I got is in checks
and I must show where it comes from.
Mr. Halley. If your income comes in that form it would seem to
me that it would be a perfectly simple thing for you to have made
these campaign contributions in checks.
Mr. Johnston. It would have been very, very easy.
Mr. Halley. Everybody else made them in checks ?
Mr. Johnston. It would have been easy, but I didn't care to make
them that way.
Mr. Halley. You said you had these large amounts of cash on
hand ?
Mr. Johnston. I had it on hand.
Mr. Halley. I wondered how you happen to accumulate the cash
m the form that you have described with money coming in in the form
[)f salary and dividend checks.
Mr. Johnston. I cashed checks when I needed cash.
Mr. Halley. Do you make a practice of cashing checks and putting
it in a box ?
Mr. Johnston. I always keep $40,000 or $50,000 in the box.
Mr. Halley. You have?
Mr. Johnston. Always have.
Mr. Halley. What needs do you have for $40,000 or $50,000 cash
n the deposit box ?
636 ORGAJSriZED CRIME! IN INTERSTATE COMMERCE
Mr. Johnston. Years ago the bank closed and I couldn't get any-
thing to eat, so I decided that it would never happen to me again.
Mr. Haixey. You now keep $40,000 or $50,000 around for a rainy
day?
Mr. Johnston. That is correct.
Mr. Halley. In a safe deposit box ?
Mr. Johnston. That is correct.
Mr. Halley. And you get that by drawing checks on your bank
account ?
Mr. Johnston. That or else cashing my salary checks or dividend
checks.
Mr. Halley. You have available your cancelled checks ? » ;
Mr. Johnston. Yes, sir
Mr. Halley. And whatever other records you have ?
Mr. Johnston. Anything that I have is available for you, Mr.
Halley. ,
Mr. Halley. Well, I have been having a little trouble getting it.
Mr. Johnston. Wait a minute, Mr. Halley; you haven't had any
trouble with me, not since I have known it yesterday.
Mr. Halley. You are always just a little unavailable.
Mr. Johnston. We won't argue; you just tell me what you want.
Mr. Halley. What I want at this time is your commitment to
produce on reasonable notice, say, no less than 3 days, to the commit-
tee investigators, your books of accounts and records.
Mr. Johnston. Mr. Halley, there is only one thing I would like
to change in that. You say within 3 days. As you can see, I am all
over this country and 3 days' time is not very much if I am in Chicago
and have to go to Miami and vice versa. Let's make it a reasonable
time from where I am. It may be 24 minutes from where I am if I am
in Jacksonville, but if I am in Chicago or New York it may be KXi
days.
Mr. Halley. Shall we make that 10 days ?
Mr. Johnston. Ten days will be all right.
Mr. Halley. What other jockey clubs do you own? We have the
Miami Beach Jockey Club, O 'Hare's interest. Do you now own the
entire stock, or just the O'Hare interest?
Mr. Johnston. I don't even hold the O'Hare interest.
Mr. Halley. What do you hold ?
Mr. Johnston. Where at?
Mr. Halley. Miami Beach.
Mr. Johnston. My wife and I, our immediate family, we will put
it, own approximately 62 — practically 15 percent of it.
Senator Wiley. What salary do you draw ?
Mr. Johnston. I draw $15,000 a year. No, $20,000 from the Miami
Beach Kennel Club.
Senator Wiley. Is that the average dividend on those 62 shares ?
Mr. Johnston. Miami Beach Kennel Club? I said 6,200 shares.
You see, these figures are not complete here. I don't know just how
this would figure out. It would be around $20,000 each 3'ear ; that is,,
the Miami Beach Kennel Club, you are asking about, alone. You are,t
not asking about the others ? j
Mr. Halley. While you are at it, why not tell Senator Wiley what'
you get from the others.
I
i
(
ORGANIZED CRIME IN INTERSTATE OOMMERCE 637
Mr. Johnston. I get $25,000 a year from the National Jockey Club.
I get $15,000 from the Miami Beach Kennel Club; I get $15,000 from
the Associated Outdoor Club of Tampa, Fla. I get $15,000 from the
Jacksonville Kennel Club, and I get $12,000 from the Orange Park
Club.
In regard to the Jacksonville Club, I am not sure whether it is
$12,000 or $15,000 from that one. The rest are correct.
Senator Wiley. Then you get dividends on top of that?
Mr. Johnston. Yes, sir.
Senator Wiley. What caused you to make this contribution to the
Governor's fund ?
Mr. Johnston. What caused me?
Senator Wiley. Yes.
Mr. Johnston. As I made the statement yesterday, he was strictly
a friend of mine and I wanted to help him. I did not think it was
going to run that high.
Senator Wiley. What do you mean by that last statement?
Mr. Johnston. When I went in there — pardon me. Senator, you
weren't here yesterday when I read my statement.
Senator Wiley. I am sorry. I just want to know. You said you
did not Iviiow it was going to run that high. Did you not give him
this money all at once ?
Mr. Johnston. No; I will tell you what happened. Mr. Wolf son
and Mr. Griffin came to me and asked me if I would join them in under-
writing the Governor's campaign. We agreed to put up $25,000
apiece. We thought that would be enough and that we would get
other contributions after that, even that we might get some of that
back. As it was, there was nothing coming back, it was just "Send
more money, send more money."
Senator Wiley. Did you make any political contributions to any-
body else ?
Mr. Johnston. Have I ?
Senator Wiley. Yes ; at the same time ?
Mr. Johnston. No.
Senator Wiley. Did you give anything to county officials or State
officials, or national officials ?
Mr. Johnston. No, sir.
Senator Wiley. Nothing to the national campaign ?
Mr. Johnston. You are talking about this time, or in the past?
Senator Wiley. Forget the past. This time ?
Mr. Johnston. No.
Senator Wiley. That was just the campaign that was just past, that
you are talking about ?
Mr. Johnston. Yes, sir.
Senator Wiley. Did any of that come from the corporations?
Mr. Johnston. None.
Senator Wiley. Is there any limitation on the amount in Florida
law that an individual can pay ?
Mr. Johnston. No.
Senator Wiley. There is a national limitation, you are aware of
that, are you not?
Mr. Johnston. Yes.
Senator Wiley. Were you aware of the fact that you were violating
a law, then ?
638 ORGANIZED CRIME; IN INTERSTATE COMMERCE
Mr. Johnston. In what?
Senator Wiley. In the amount that you were paying ?
Mr. Johnston. No, sir.
Senator Wiley. Did you expect anything in return ?
Mr. Johnston. No, sir.
Senator Wiley. Were any promises made for it ?
Mr. Johnston. No, sir.
The fact of the matter is this : It was just a matter of underwriting,
guaranteeing, some money. As it was, my word was on it and I was
just stuck. Senator. i
Senator Wiley. I have no other questions.
The Chairman. All right, Mr. Halley.
Mr. Halley. When did you acquire your interest in the Associated
Outdoor Club?
Mr. Johnston. In Tampa?
Mr. Halley. That is 1939? ;
Mr. Johnston. Yes. '
Mr. Halley. In Miami Beach in 1941 ? '
Mr. Johnston. That is correct.
Mr. Halley. You paid $41,000 down and notes for some more
money ?
Mr. Johnston. That is correct.
Mr. Halley. Then Orange Park you built yourself?
Mr. Johnston. That is correct.
Mr. Halley. Wlien was that ?
Mr. Johnston. That was in about — right after the war. j
Mr. Halley. 1946 or 1947? '
Mr. Johnston. As soon as the release came of materials.
Mr. Halley. When did you acquire your interest in the Jackson-
ville Kennel Club ?
Mr. Johnston. I acquired the biggest part of it at the same time
that I got the O'Hare interest, but I had acquired some as I went
along. I bought some from local people who wanted to get out before
that time.
Mr. Halley. Then in 1946 you acquired j^our stock in the National
Jockey Club?
Mr. Johnston. I think 1946 ; around that time.
Mr. Halley. For that you paid a quarter of a million dollars?
Mr. Johnston. I think that was my share.
Mr. Halley. Did j^ou pay it in cash ?
Mr. Johnston. In checks.
Mr. Halley. Checks ?
Mr. Johnston. Yes, sir.
Mr. Halley. But you paid for it outright at that time?
Mr. Johnston. Yes, sir.
Mr. Halley. O'Hare was killed in 1938; is that right?
Mr. Johnston. 1939, 1 believe.
Mr. Halley. Up to 1939 you were a salaried employee; is that
right ?
Mr. Johnston. No; I had gotten a little stock in tlio Jacksonville
Kennel Club and I had a track from 1934. That has now closed,
across the river from Mem]:)his in Ai'kansas. I ran that.
Mr. Halley. What track was that ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 639
Mr. JoiixsTON. The Eiverside Greyhound Track, West Memphis,
Ark.
Mr. Halley. During what years did you run that?
Mr. Johnston. Oh, I ran that from about 1034 until just the begin-
ning of the war.
Mr. Halley. Did you have any associates in the Riverside Track?
Mr. Johnston. Yes, sir.
Mr. Halley. Who were they ?
Mr. Johnston. They were some people tliere from Arkansas who
owned 50 percent of it.
Mr. Halley. Any people from Hot Springs ?
Mr. Johnston. No. There was a fellow by the name of Landers,
a planter; a banker by the name of Rhoades had part of it; a lawyer
there from West Memi^his that had part of it.
Mr. Halley. Well, we do not have your records and I think to
save time I am not going to try at this point to get the details. We
will save that until we have seen the records, but would you explain
in general how starting practically from scratch in 1932, and with
the exception of this dog track you named in Arkansas, being prac-
tically nothing but a salaried employee up to 1939, you are able to
accumulate enough money to pay $250,000, approximately, of your
own money for the National Jockey Club in 1946 ?
Mr. Johnston. I think that you will find all the way through
whenever I went into these things, when I associated with Mr. Bid-
well and my brother in accumulating these various interests, I took
them in with me to help finance these deals.
Whenever I bought any of this, whatever I did, I bought in and
borrowed the rest from my brother. I had made big money, as you
know, from those income-tax returns.
Mr. Halley. Tax rates have been quite high and particularly dur-
ing the war years.
Mr. Johnston. That is right.
Mr. Halley. To accumulate, and living well, as I gather you do,
$250,000 by 1946 would seem to me to be a fairly good trick.
Mr. Johnston. I think I have done very well for myself.
Mr, Halley. I was wondering if you would care to explain where
the accumulation of capital came from so that you were able to put
$250,000 into Sportsman's Park in 1946 ?
Mr. Johnston. I don't know how the accumulations came. You
put in all the moneys that I had in these things and I have been
parlaying the money.
When I would get dividends I would put them back in. I would
borrow when I needed to borrow, and I just kept on buying.
Mr. Halley. I think you stated that the quarter million you put
in in 1946 was your own money, and that you did not borrow?
Mr. Johnston. I don't know that I said that.
You asked me what I paid for my interest, and I said $249,000.
Mr. Halley. Well, what is the fact? Let us forget about what
you said. What is the fact ?
Mr. Johnston. I wouldn't know until I checked up. "Wliat I put
in, I borrowed and paid back.
Mr. H.\LLEY. Well, it was a pretty big deal. You probably re-
member. What is your best recollection today on what happened?
640 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Johnston. The best recollection I have today ?
At the time we bought that stock in the National Jockey Club, we
got together, my brotlier and I, and the first thing that we did — we
had to close this deal in 24 hours. We borrowed $400,000 and put up
our stock.
Mr. Halley. From whom did you borrow the $400,000 ?
Mr. Johnston. We borrowed the $400,000 out of the treasury of
the Miami Beach Kennel Club and put our stock up as security for
it, and we later paid it back in as we made arrangements on the thing.
Mr. Halley. That is astonishing. Did you own 100 percent of the
Miami Beach Kennel Club ?
Mr. Johnston. No, sir.
Mr. Halley. What percent?
Mr. Johnston. The stockholders approved the loans.
Mr. Halley. Was that ratified at a later time ?
Mr. Johnston. It has all been ratified.
Mr. Halley. You didn't have time to go before them before, then?
Mr. Johnston. No; but it was ratified afterward.
Mr. Halley. And you just took that amount out of the treasury
and made the deal?
Mr. Johnston. That is correct; and pledged the stock as security
for it.
Mr. Halley. What stock did you pledge ?
Mr. Johnston. I put up all the stock I had and all the tracks I had.
Mr. Halley. Including Sportsman's Park?
Mr. Johnston. Yes. There was very, very good security there.
Mr. Halley. And then you finally did get that ratified ?
Mr. Johnston. We got it ratified ; yes.
Mr. Halley. Then you paid them back ; is that correct ?
Mr. Johnston. Yes.
Mr. Halley. Very shortly?
Mr. Johnston. Yes.
Mr. Halley. And what money did you use to pay it back?
Mr. Johnston. In other words, here is the situation. On this stock
that was bought, Biclwell and I bought it as trustees. When the stock
was eventually — as we allotted it to who we were giving part of it to,
we would cash those things in. We would take the money. And we
finally paid it off.
JNIr. Halley. Well, look, Mv. Johnston. We are sort of getting lost
in details. It would seem to me that these high salaries you received
were received by you only after you started buying tracks and con-
solidating yourself.
Mr. Johnston. That is correct. That is the reason I bought them.
Mr. Halley. And that prior to the war years, when taxes were not
so high, you didn't own those tracks.
Mr. Johnston. I made very good money since 1934.
Mr. Halley. Even at Sportsman's Park?
Mr. Johnston. Yes.
Mr. Halley. I thought you said your income there never was over
$9,000 a year, or $8,000 a year.
Mr. Johnston. That is one place. You know, I was always running
at other places. That was only 30 days a year.
Mr, Halley. Well, we are going to get your records and find out.
ORGANIZED CRIME IN INTERSTATE COMMERCE 641
Mr. Johnston. Yes, sir.
Mr. Halley. But lefs have your statement as best you can give it
of what capital accumuhitions you made prior to 1946, so that you
were in a position to buy Sportsman's Park with your own money.
Mr. Johnston. Well, I didn't say I was in a position to buy Sports-
man's Park with my own money. Don't try to put words in my
mouth, now.
Mv. Halley. What did you say?
Mr. Johnston. I told you my brother and I and Bidwell got
together and got the money together to put into Sportsman's Park.
Mr. HaIvLey. Your share of it was about a quarter of a million
dollars ?
Mr. Johnston. I can tell you what my share is here, approximately.
Between myself and my family, we have about 1,300 shares at $160
a share. Figure it out for yourself, and you will find out what my
share was.
Mr. Halley. Well, how many shares did you have ? How many did
you pay for?
Mr. Johnston. That is what I paid for.
Mr. Halley. You paid for 1,300 shares?
J\Ir. Johnston. Yes.
Mr. Halley. At $160 a share?
Mr. Johnston. That is correct.
Mr. Halley. So that would be something over $200,000?
Mr. Johnston. That is correct. That is what I said.
]\Ir. Halley. And you borrowed it very temporarily from the Miami
Beach Jockey Club, just so you could close the deal in a 24-hour period.
Mr. Johnston. That is right.
Mr. Halley. And then I presume you paid them right back.
Mr. Johnston. We paid them back, yes. I don't say we paid back
the next day. I think it took us about a year to pay that back.
Mr. Halley. You mean you held the money for the Miami Beach
Jockey Club for about a year?
Mr. Johnston. I think that is right.
Mr. Halley. And then you paid it back ?
]\Ir. Johnston. Let me get the records.
Mr. Halley. All right ; but I wanted to get the best statement as to
where you got the money, where you got the quarter of a million
dollars.
Mr. Johnston. Well, I earned it.
Mr. Halley. You accumulated it out of earnings?
Mr. Johnston. Yes. sir; I accumulated it.
Mr. Halley. Did you make any outstanding or important capital
gains during the period prior to 1946 ?
Mr. Johnston. No, sir.
Mr. Halley. Did you make any capital gains in excess of $10,000,
let us say ?
Mr. Johnston. No, sir.
Mr. Halley. So that it was all accumulated out of earnings ?
Mr. Johnston. All accumulated out of earnings, all the money that
I had. Except that I made capital gains since then.
Mr. Halley. We are talking about the period up to the time you
put almost a quarter of a million dollars into Sportsman's Park. And
(542 ORGANIZED CRIME! IN INTERSTATE COMMERCE
it is your statement that you accumulated that money out of earnings?!
Mr. Johnston. I told you that I borrowed $400,000 from the Miami
Beach Kennel Club.
Mr. Halley. You also told me that you paid it back in the end.
Mr. Johnston. Yes, we paid it back.
Mr. Halley. Did you borrow money to pay it back again ?
Mr. Johnston. Let me ask you something, Mr. Halley, here. Are
you trying to confuse me ? I am trying to give you the facts the best I
can. I am trying to be a witness here, and give you the facts. It
looks to me like you are trying to confuse me and berate my testimony.
Senator Kefauver. Well, Mr. Johnston, nobody is trying to confuse
anybody.
Mr. Johnston. I am sorry. Senator. ,
Senator Kjefauver. What the question was, and it is a fair one, is |
that you borrowed $400,000 from the Miami Beach Kennel Club and
paid it back very shortly ; I think you said within a year?
Mr. Johnston. I don't know the exact dates, but let me go back and:
check the records and come back and give it to you.
Senator KErAU\'ER. I think that out of that sum you paid the
two-hundred-thousand-odd dollars for Sportsman's Park.
So if you know how you paid the $400,000 back, where you got the
money from, we would appreciate your telling us.
Mr. Johnston. Yes. You see, let me explain this to you. We
bought this, and we divided it up, and each one would bring in their
money and get their share for this stock. And it all went through an
account that I had at the Northern Trust Co. When I get to that
account to check up on it, I will be able to give you all your facts and
figures.
Mr. Halley. Did you borrow the money to pay back the Miami
Beach Kennel Club, or did you pay that without borrowing?
Mr. Johnston. No, sir ; I paid it back.
Mr. Halley. And you didn't borrow money from Peter to pay Paul ?
Mr. Johnston. No.
Mr. Halley. Now, do you know Harry Russell?
Mr. Johnston. I know of him. I know him, yes; but, as I said
before, I know a lot of people.
Mr. Halley. But he is one of a lot of people you know ?
Mr. Johnston. One of a lot of people I know ; yes.
Mr. Halley. When did you first meet Harry Russell ?
Mr. Johnston. I think the first time I met Harry Russell was — I
would say 4 or 5 years ago.
Mr. Halley. Four or five years ago. Where did you first meet
him ?
Mr. Johnston. Charley Bidwell used to have an office around
Plymouth Court in Chicago, and he had a restaurant on the corner of
State and Van Buren Streets.
Mr. Halley. Russell had a restaurant ?
Mr. Johnston. Yes.
Mr. Halley. Russell's Bar?
Mr. Johnston. Russell's Silver Bar, I think is the name of it.
Mr. Halley. And Ralph Pierce is located upstairs?
Mr. Johnston. I don't know.
Mr. Halley. You know Ralph Pierce?
ORGANIZED CRLME IN INTERSTATE COMMERCE 643
Mr. Johnston. I never have met and never have seen Ralph Pierce.
Mr. Halley. At any event, you went into Russell's Silver Bar, and
you met Harry Russell?
Mr. Johnston. That is right.
Mr. PIallet. And you have continued knowing him through the
3^ears since?
Mr. Johnston. Tliat is right. I have seen him possibly from time
to time a dozen times since then.
]\Ir. Halley. Well, witnesses have mentioned that they have seen
him with you in Miami at the Miami Beach Kennel Club, for instance.
Mr. Johnston. That is correct.
Mr. Halley. And I believe he has been seen with you up at Sports-
man's Park. Would that be right?
Mr. Johnston. No, sir.
Mr. Halley. You have never seen him at Sportsman's Park?
Mr. Johnston. No, sir.
Mr. Halley. You are sure of that ?
Mr. Johnston. I am sure of that.
Mr. Halley. But you have seen him in and around Chicago ?
Mr. Johnston. Well, I saw him at the Blackstone Hotel in the lobby
once, but that is about the only place I have seen him.
Mr, Halley. You say you have seen him about a dozen times
altogether ?
Mr. Johnston. Possibly that.
Mr. Halley. Have you ever had any business dealings with
Russell?
Mr. Johnston. No; I haven't. At one time his partner, whose
name was Fishman, talked about leasing some property that we had
to put a restaurant in Miami Beach. It never went through. That
was the only thing we ever had.
Mr. Halley. Russell was associated with Fishman in certain book-
making businesses, wasn't he ?
Mr. Johnston. Well, Fishman was the one who ran the restau-
rant. I have never seen Russell in the restaurant so much as I did
Fishman. I met him in there one time, as I testified before. But
Fishman was the one who ran the restaurant there.
Mr. Halley. And you got to know Russell as an acquaintance at
least ; is that right ?
Mr. Johnston. That is right.
Mr. Halley. From time to time did you call him up on the tele-
phone ?
Mr. Johnston. No.
Mr. Halley. Well, you have called Harry Russell on the telephone,
haven't you ?
Mr. Johnston. Not that I recollect. I may have. I don't know.
Mr. Halley. Would it surprise you to know that the telephone
Dills so reflect ?
Mr. Johnston. I may have called him. I don't know.
Mr. Halley. Now you know Rush, of course, John Rush ?
Mr. Johnston. Yes, sir.
Mr. Halley. How long has he represented your interests?
Mr. Johnston. He has represented the Jacksonville Kennel Club
since '45, 1 believe.
(
544 OiRGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. How did you happen to become acquainted with John
Rush?
Mr. Johnston, Lester Jennings, who is an attorney in Jackson-
ville, was my attorney, and he shared offices with John Rush. And
he died in January 1945 ; so we just took on Mr. Rush as the attorney
for the track.
Mr. Halley. Now, do you know W. O. Crosby ? i
Mr. Johnston. Yes, sir. 1
Mr. Halley. He is the man who was a special investigator appointed
by Gov, Fuller Warren ?
Mr. Johnston, That is correct.
Mr. Halley. How long have you known W. O. Crosby?
Mr. Johnston, I knew "Bing'- since he worked for the gas company
in Jacksonville.
Mr. Halley. When was that?
Mr. Johnston. When we opened the track. He used to come out
to the track quite often. He worked for the gas company, and then
he went into the police force and was on the police force. And I didn't
see him so much after that until recently.
]\Ir. Halley, What do you mean "recently" ?
Mr, Johnston, When he came to Miami Beach, he used to come-
over to the dog track,
Mr, Halley, You mean when he came to Miami Beach as an in
vestigator ?
Mr, Johnston, I imagine that is what he was there for,
]\Ir, Halley, That was in the first months of 1949 ? i
Mr, Johnston, Yes, after Governor Warren was elected,
Mr, Halley, And he would come to see you quite often, wouldn't
he, at the dog track ?
Mr, Johnston, Not very often, because I wasn't there very often.
You see, I ran three tracks all during the same time, I spent a fe
days in Jacksonville, a few days in JMiami, and a few days in Tampa,
Mr, Halley, Let's shorten it by saying he came to see you several
times during that period. Is that right?
Mr, Johnston, That is right.
Mr. Halley. During that ])eriod, did you also see Russell?
Mr. Johnston. 1 possibly did, yes. If he was at the track, I see:
him.
IMr, Halley, And talked to him at the track?
Mr, Johnston, Yes,
Mr, Hali.ey. Did you also know a Craig, a Raymond Craig ?
Mr. Johnston. No.
Mr. Halley. Do you know who Raymond Craig is?
Mr. Johnston. By reputation.
Mr. Halley. He is a rather well known bookmaker in Miami ?
Mr. Johnston. I understand that is what he is, but I don't know.
Mr. Halley. Have you never met Craig?
Mr, Johnston. I don't believe I have. I may have met him andl
don't remember. As an example, here, the other day, one of thes^l
boys from Miami spoke of an introduction to me, and he told me where
he had met me, and I didn't remember it. That was a bad mistake,
when I didn't remember a newspaper man. but that is the fact. I
mean, you can't remember everyone you meet.
I
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 645
]Mr. Haixey. Well, Crai<i- was a man who was tryino; to push a bill
to have gambling legalized in Florida. Do you recall that?
Mr. Johnston. I don't recall that. I knew there were a couple
of bills up, there. But trying to legalize gambling?
Mr. Halley. Legalizing it off the track.
Mr. Johnston. That is right.
Mr. Haixey. And certain of those bills found their way into John
Rush's office ; isn't that right ?
Mr. Johnston. I know that now. but I didn't know it at that time.
Because that is one thing that I did not know about. And if I had
known about it, I didn't like that very well, because it is against my
interests.
Mr. Halley. I was wondering if it would refresh your recollection
if you were told that Craig says he discussed the legalized gambling
bill with you.
Mr. Johnston. Craig discussed the legalized gambling bill with me ?
Mr. Halley. Did he ever telephone you long distance from Florida
to Chicago?
Mr. Johnston. Craig? I don't remember Craig calling me long
distance. You know, at that time, during the legislature, there was
a lot of people that would be coming to me.
Senator Wiley. What time was that ?
Mr. Johnston. That was 1949.
Mr. Halley. Why would a lot of people come to you ?
Mr. Johnston. Because the newspapers had made me a big man
in Florida.
Mr. Halley. How had the newspapers made you a big man?
Mr. Johnston. Well, if you read the headlines, they said I was the
Governor's chief adviser and the Governor's boozing pal and all this
sort of stuff. And, I want to tell you, I got a million calls.
Mr. Halley. Well, in fact, didn't you pay something like a hundred
thousand dollars for the privilege of becoming the Governor's chief
adviser?
Mr. Johnston. I was never the Governor's chief adviser and never
wanted to be the chief adviser of the Governor. I have enough head-
aches trying to run five race tracks.
Mr. Halley. Did the Governor ever consult you about any matters
concerning the government of the State of Florida ?
Mr. Johnston. No, We discussed various things, but he never dis-
cussed anything like that with me at all. A racing commission was
appointed, I says, "I don't care who you put on the commission.
They can't do anything for me pr anything against me. Just so they
are fair; that is all I care."
Mr. Halley. Were you here yesterday when Mr. Griffin returned
to the witness stand to give further testimony?
Mr. Johnston. I was.
Mr. Halley. Did you hear his testimony?
Mr. Johnston, I did,
Mr. Halley, Would you care to comment on it ?
Mr. Johnston. Well, I didn't get what was straight on that. Did
Mr. Griffin say that I put $154,000 into this campaign, or did he say
that he did t
646 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Halley. I think he said that you, he, and Wolfson agreed each
to put $154,000 in.
Mr. Johnston. Well, he is mistaken in that.
Mr. Halley. The original agreement, I think he said, was simply to
underwrite it, and he said you contributed equal amounts. I think he
said that he put $154,000 in, and therefore he assumed you did.
Mr. Johnston. I thought that he had said that I had put it in.
Mr. Halley. Your total was about $100,000 ; is that correct ?
Mr. Johnston. That is correct.
Mr. Halley. Plus notes for $30,000, which you then got back?
Mr. Johnston. That is right.
Mr. Halley. And of your hundred, only about CO was your own
money ?
Mr. Johnston. Around 40, 1 think, whatever it figures out ; around
$40,000.
Mr. Halley. Now, did you hear Griffin state yesterday that he
thought that your going to Tallahassee had something to do with his
commission as the Governor's investigator being withdrawn?
Mr. Johnston. I didn't hear that. Did he say that ?
Mr. Halley. He said you were in Tallahassee, and in fact he testi-
fied in Florida that he saw you coming away from the capitol the day
after his commission was announced, and that that night his commis-
sion was revoked by the Governor.
Mr, Johnston. Mr. Griffin must have been mistaken, because I did
not come away from the capitol on that day.
Mr. Halley. Were you in Tallahassee?
Mr. Johnston. I was in Tallahassee.
Mr. Halley, Did you see the Governor?
Mr. Johnston. I seen the Governor and had lunch with the Gov-
ernor.
Mr. Halley. What did you talk about?
Mr, Johnston, It was strictly a social call. I was no more inter-
ested in Mr. Griffin, or Mr. Griffin's activities — and Mr. Griffin's fight
with the Governor is no part of mine, I had nothing to discuss with
the Governor about Mr. Griffin.
Mr. Halley. At that time, did you talk with the Governor about
the investigations being made in Miami ?
Mr, Johnston. I never discussed anything with the Governor. The
only time that I ever discussed anything with the Governor along
those lines was that at one time I told him that I thovight that if the
books were all closed it might help, you know, the racing business and
help to handle things at the tracks,
Mr. Halley. You knew of the proposal to close up all the illegal
bookies ?
Mr. Johnston. Yes, sir.
Mr. Halley. Did you advocate it to the Governor ?
Mr. Johnston. I didn't advocate anything to him. I told him that
I thought that might be a good policy.
Mr, Halley, Did you ever suggest to him that he appoint Crosby
to go down to Miami and close up the books ?
Mr. Johnston, I had nothing to do with the Governor's operations.
I didn't think it was good policy for me, as a businessman, to take any
part in politics, and I tried to stay away from it.
ORGANIZED CRIME' IN INTERSTATE COMIVIERCE 647
Mr. Halley. If so, wliy did you put all tluit money into it?
Mr. Johnston. For tlie sini})le reason that I didn't intend to put it
in. I told you I was trying to help a friend of mine and got hooked.
Mr. Halley. You certainly intended putting $25,000 in, which was
your original commitment.
Mr. Johnston. I had hopes that I might get some of it back, but I
doubted it very much.
Mr. Halley. Why did you get in for $25,000 if it was your convic-
tion that you should stay out of politics ?
Mr. Johnston. Well, I figured that he was a friend of mine, and
a very close friend of mine, and if I couldn't help a friend of mine,
why, if you can't help a friend, what good are you in this world ?
Mr, Halley. So you put $25,000 up, just to help a friend?
Mr. Johnston. I intended to get part of it back. This agreement
from the very start, Mr. Halley, was "if they get the money in here,
and they know it is financed, we will get more contributions in."
Mr. Halley, Now, do you associate at all any connection between
the fact that you were a very good friend of the Governor, that you
were a very good friend of Bing Crosby's, that you were a very good
friend of John Rush, that you thought the bookies should be closed,
that you were a friend at least of Harry Russell ?
Mr. Johnston. I didn't say I was a friend of Harry Russell. I
said I was an associate of Harry Russell,
Mr. Halley, But you knew him. Do you think any inference can
be drawn that perhaps you had some connection with Crosby going
down to Miami Beach and starting to close up bookies?
Mr, Johnston, No, sir. I never discussed any of those State affairs
with any of them.
Mr. Halley. While Crosby was in Miami Beach, he saw you several
times ?
Mr, Johnston. Not only he but a lot of other J)eople came to the
track.
Mr. Halley. Thousands of people come to the track, but let's talk
about the issue. Crosby was the Governor's appointee.
Mr. Johnston. Yes.
Mr. Halley. He was somebody you had known for several years ?
Mr. Johnston. Yes.
Mr. Talley. You had known him quite well ; hadn't you ?
Mr. Johnston. Yes ; I had known him very well. He had come to
the track.
Mr. Halley. You were a very good friend of Bing Crosby ?
Mr. Johnston. Well, a very good friend of Bing Crosby? I
don't think we were personal friends. We didn't go back and forth to
one another's homes. He used to come to the track. I would talk to
him and say "Hello" to him.
Mr. Halley. You went out with him socially?
Mr. Johnston. Well, I didn't go out with him socially. I have had
lunch with him. I have had drinks with him. But I didn't
Mr. Halley. You went to football games and other events with him ?
Mr. Johnston. We were very good friends.
Mr. Halley. You were very good friends.
Mr. Johnston. That is right.
Mr. Halley. And you and the Governor were very good friends ?
68958— 50— pt. 1 42
648 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Johnston. Very good friends. He was a good friend of the
Governor's also.
Mr. Halley. And you at least knew Harry Russell ?
Mr. Johnston. I knew Harry Eiissell ; yes.
Mr. Halley. And Russell then comes down to Miami ; is that right?
And you saw Russell during this period in Miami when Bing Crosby
was there?
Mr. Johnston. Yes ; I seen Russell there.
Mr. Halley. And you saw Bing Crosby ?
Mr. Johnston. That is correct.
Mr. HalI;EY. Did you ever discuss with either Russell or Crosby,
either of them, the Crosby investigation ?
Mr. Johnston. No, sir.
Mr. Halley. Did Crosby tell you that Russell was tipping him off
as to the places to raid ?
Mr. Johnston. We never discussed — I used to have a lot of those
State employees come over there. They would say, "Bill, why don't
you try and get me a raise?" Or "Why don't you get me a job?" Or
"Why don't you do this?" I said, "I don't want anything to do with
any of your troubles. I don't want any part of them." They wanted
me to go on the patronage committee. I wouldn't go on it. Because
if I do one thing, I get 15 people mad at me. And I stayed completely
out of it altogether. I wouldn't discuss anything that they would
come and try to talk with me about.
Mr. Halley. You are pretty well connected politically in the State
of Florida ; aren't you ?
Mr. Johnston. Well, I don't know what you mean by that.
Mr. Halley. You are a good friend of at least one of the judges of
the supreme court ; are you not ?
Mr. Johnston. I met him in the campaign ; yes.
Mr. Halley. Judge Roberts ?
Mr. Johnston. Yes.
Mr. Halley. You contributed to Roberts' campaign, too; didn't
you?
Mr. Johnston. Roberts didn't run. He was appointed by the Gov-
ernor.
Mr. Halley. Did Roberts contribute to the Governor's campaign?
Mr. Johnston. I don't know.
Mr. Halley. In any event, you and Roberts are quite close friends.
INIr. Johnston. We have been close friends; yes. I met Roberts
through Governor Warren, and we have been quite good friends.
]\f r. Halley. Do you know Sheriff Sullivan ?
Mr. Johnston. No. I have met Sullivan, but I wouldn't say that I
am a very close friend of his.
Mr. Halley. You still see John Patton ?
Mr. Johnston. I do.
Mr. Halley. He is still associated with you in the various race
tracks ?
Mr. Johnston. Not in the various race tracks; in Miami Beach, and
in Tampa.
Mr. Halley. In the Kennel Club?
Mr. Johnston. Yes.
Mr. Halley. You occasionallv see him in Chicago?
ORGANIZED CRIMEi IN INTERSTATE CX)MMERCE 649
Mr. Johnston. I very seldom see him in Chica<i:o. He is out on a
farm about a hundred miles from Chicago, and when I am up here in
the summertime I am up in Miclii<>:an, and I very seldom see him;
only in the wintertime.
Mr. Halley. You talk back and forth on the phone often ; don't
you?
Mr. Johnston. Once in a while, but not too often ; no.
Mr. Halley. Oh, every few da}' s perhaps ?
Mr. Johnston. I wouldn't say that; no.
JMr. Halley. Well, I see a phone call here in 1950. I see it on
January 26.
Mr. Johnston. That is in the wintertime. You asked about the
summertime.
Mr. Halley. In the wintertime you talk quite often?
Mr. Johnston. Oh, yes; in the wintertime we talk quite often.
Mr. Halley. But not in the summer?
Mr. Johnston. Not in the summer.
Mr. Halley. I have no further questions.
Senator Kefauver. Mr, Johnston, just one or two questions.
This RusselFs Bar, where you knew Mr. Russell — you knew that Mr.
Pierce, Mr. Ralph Pierce, was upstairs ?
Mr. Johnston. No, sir.
Senator Kefauvhr. Did you say that you knew Mr. Pierce?
Mr. Johnston. No ; I never knew JMr. Pierce.
Senator KErAU^T:R. You didn't know that he owned the building
that Russell had his bar in ?
Mr. Johnston. Senator, Russell's Restaurant is a very popular
restaurant in Chicago. Thousands of people go in there every day,
and I used to go in there and eat. And that was all I did. I never
laiew who owned the building any more than I would know who owned
any of these restaurants here.
Senator Kefauver. Did you have anything to do with Russell com-
ing down to Florida?
Mr. Johnston. Nothing whatsoever. Russell was in Florida for
3 or 4 years, as I understand it. And he has been coming to my track
for 3 or 4 years. Russell has been coming to my track every niglit
just as much for the last 3 years as this year. There has been no differ-
ence.
Senator Kefattv^r. Did you talk with him about coming to Florida ?
Mr. Johnston. I never talked with him. The only one I talked to
in there was, as I made the statement before, when they wanted to
start a restaurant, Mr. Fishman; but it never went through.
Senator Kefauver. Now, you have listed your salary from the Asso-
ciated Outdoor Club, I believe, at $15,000 ; and Miami Beach Kennel
Club, $15,000.
Mr. Johnston. $20,000, I think.
Senator Ivefauver. Orange Park Kennel, 12 or 15.
Mr. Johnston. Something like that ; 12, I think.
Senator Kefauver. Jacksonville, about the same,
Mr. Johnston. Yes.
Senator Kefauver. National Jockey, about 25, did you say?
Mr. Johnston. That is correct.
650 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Senator Kefauver. Then how about these dividends ? These thirty-
one or thirty-two-thousand-dollar dividends? Is that from these
same outfits?
Mr. Johnston. Yes, sir. I have cot more dividends than that, sir.
Senator Kefauver. What do your dividends amount to?
Mr. Johnston. I don't know, offhand.
Senator Kefauver. AVell, your best approximate idea.
Mr. Johnston. You see, between my wife and I — my wife owns
some of this stuff, but we have filed a joint return this past few years.
Previous to that we used to file them separately. I think the National
Jockey Club paid $20 or $25 a share last year. So that is about $26,000
from there. The Jacksonville Kennel Club paid $30 or $40. I would
have to get it for you. But I think my income — I am getting into
something else again, but I think my total income, with my salaries,
net, has been running in the neighborhood of $225,000 or $250,000 a
year. That is just my recollection. I would have to check. I think
last year I had some capital gains of a little bit more, but I will have
to check.
Senator Kefauver. It has been that way for several years ?
Mr. Johnston. Yes.
Senator Kefauver. What is the Eye in the Sky ?
Mr. Johnston. Well, the Eye in the Sky is a camera company that
takes the photo finishes of all race tracks. I was the first one to orig-
inate the photo finish of a horse race. There was a fellow b}^ the name
of Harvey, from St. Petersburg, and I worked with him in the develop-
ment of that and kept that company going since then.
Senator Kefauver. Does Mr. Patton own an interest in the Eye in
the Sky?
Mr. Johnston. No.
Senator Kefauver. Mr. John Rush was one of your stockholders in
some of these companies ?
Mr. Johnston. That is correct; very small stockholder. If you will
notice, there, whenever I bought a block of stock I used to let my
friends around buy a few shares in it Avith me.
Senator Kefauver. Who is Violet Bidwell ?
Mr. Johnston. That is Charles Bidwell's widow.
Senator E^efauver. This H. H. Humphries : Who is that ?
Mr. Johnston. He is a doctor from Jacksonville, Fla.
Senator Kefauver. Now, you know Weldon Sterry very well, do
you not?
Mr. Johnston. Yes, sir.
Senator Kefauver. He is an attorney in
Mr. Johnston. In Tallahassee.
Senator Kefauver. What has been your connection with him ?
Mr. Johnston. I have only known him since he lias been working
with the Governor. I didn't know him before the campaign.
Senator Kefauver. How is it that you called him so often ?
Mr. Johnston. How did I call Weldon Sterry ?
Senator Kefauver. Yes.
Mr. Johnston. Well, for the simple reason that we had been to
Tallahassee, and he was the Governor's secretary, and when I would
go over there and wanted to talk to the Governor he would get him
for me.
ORGANIZED CRIMEl IN INTERSTATE COMMERCE 651
kSenator Kefatjver. He was the Governor's secretary ?
Mr. Johnston. Well, he was a sort of a Governor's aide, we will say.
Senator KEaPAxnER. One of the contact men for the Governor?
Mr. Johnston. I think he worked with the Governor. And if I
wanted to talk to him, or something, I would get a message to him.
Senator Kefattvee. Well, he does not still work for the Governor,
does he?
Mr. Johnston. What is that ? Weldon Sterry ?
Senator Kefattvee. Yes.
Mr. Johnston. Well, I don't think he works for the Governor;
he is a friend of the Governor's.
Senator Kefata-er. What did you want to talk with him about?
Mr. Johnston. With who ?
Senator Kefatjver. Sterry.
Mr. Johnston. Well, I would want him to tell the Governor that
I was coming over to see him, or get a message to him.
Senator Kefatjver. He was not actually employed by the Governor.
He was just a friend of the Governor's, was he not?
Mr. Johnston. That is right.
Senator Kefatjver. But he was your go-between ? For the Governor
and you?
Mr. Johnston. I wouldn't say he was.
Senator Kefauver. He was your go-between with the Governor ?
Mr. Johnston. In other words, I wouldn't know whether the Gov-
ernor would be at home. And if he didn't answer telephone calls,
I would let him know.
Senator Kefauver. What would be your idea in wanting to see the
Governor so much? You said you were not interested in anything.
Mr. Johnston. Well, for 15 years there wasn't a day that he was
in town that I didn't get together with him some time during the
day and have maybe a Coca-Cola or some coffee together. If there
were any of those days that went by, they were few. We were very
close friends. He was one of the closest friends I had. And I didn't
think because of the fact that he became the Governor that friendship
should go away.
Senator Kefauver. Did Sterry ever represent you as your lawyer,
or any of your interests ?
Mr. Johnston. Did Sterry ever represent me ? I don't believe so.
Senator Kefauver. Did you know that Sterry represented Crosby
in the hearing down in Miami ?
Mr. Johnston. No, sir; I did not.
Senator Kefauver. You had not been advised about that?
Mr. Johnston. No, sir.
Senator Kefauver. Sterry was a partner of Mr. Roberts, I believe,
was he not ?
Mr. Johnston. If he was, I didn't know it.
Senator Kefattver. Or a law associate, or something ?
Mr. Johnston. He may have been, but I never knew it. You see, Mr.
Sterry I didn't meet until after the Governor was inaugurated, over
there in Tallahassee.
Senator Kefauver. Now, do you know Mr. Grenada ?
Mr. Johnston. AVlio?
Senator Kefauver. Mr. Grenada, a representative in the legisla-
ture in Chicago.
652 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Johnston. I know of him. I don't know him very closely;
no.
Senator Kefauver. Well, you have called him on the telephone,
haven't you?
Mr. Johnston. No ; I have never called him.
Senator Kafauver. You didn't call him in January 1950?
Mr. Johnston. No, I don't think so. I may have called Jack
Grenada, who is not a member of the legislature, but who is the
auditor of the National Jockey Club. That may have been the call.
Senator KAFAU^^R. J. C. Grenada ? Which is he ?
Mr. Johnston. That is he. He is a certified public accountant in
the city of Chicago.
Senator Kefauver. Is he a brother of the State representative?
Mr. Johnston. I think so.
Senator Kefauver. Were you interested in any legislation in the
Illinois legislature last year ?
Mr. Johnston. No, sir.
Senator Kefauver. You didn't discuss a bill with anybody?
Mr. Johnston. No, sir.
Senator Kefauver. A bill that was pending?
Mr. Johnston. No.
Senator Kefauver. Did you know there was a bill pending about
trying to have grand juries in the State of Illinois longer than 30
days?
Mr. Johnston. No, sir.
Senator I^FAU^^R. You did not have any contact about that?
Mr. Johnston. No, sir.
Senator Kefauver. Now, you said you knew Jack Guzik, Mr.
Johnston ?
Mr. Johnston. I didn't say I knew him.
Senator Kefauver. Oh, you said you did not?
Mr. Johnston. I said I did not know him.
Senator Kefauver. You said you knew he had some connection with
Hawthorne Kennel Club ?
Mr. Johnston. No; I didn't.
Senator Kefauver. I thought that you said that Patton and
Mr. Johnston. I said I had met him one day at the Hawthorne
Race Track.
Senator Kefauv^er. That Patton and O'Hare and Guzik were as-
sociated together in the Hawthorne Kennel Club, and that Hawthorne
was the predecessor of Sportsman's Park.
Mr. Johnston. I think Mr. Halley said that. I didn't.
Senator Kefauver. Well, how well did you know Mr. Guzik? You
just met him?
Mr. Johnston. I met him once in a while at the Hawthorne Race
Track. This isn't the Kennel Club. It is the race track, in Chicago,
Senator Kefauver. Yes; that is right, the Hawthorne Race Track.
Mr. Johnston. That is the only time I have ever seen him.
Senator Kefauver. Was he one of the promoters of the Sportsman's
Race Track ?
Mr. Johnston. Never, as far as I knew.
Senator Kefauver. Do you know I^ouie Greenberg?
Mr. Johnston. I have met Louie Greenberg.
ORGANIZED CRIMD IN INTERSTATE COMMERCE 653
Senator Kefauver. Where did you meet him?
Mr. Johnston. I met Louie Greenberg at the races, and I met him,
I think, at some fights once. And I met him on an airplane one time.
Senator KEFAinER. Have you had any business dealings with him?
Mr. Johnston. None whatsoever.
Senator KEFAU^'ER. Paul Ricca?
Mr. Johnston. I never heard of him.
Senator Kefauver. Charlie Berend ? Do you know him?
Mr. Johnston. No.
Senator Kefauver. Senator Wiley, do you have any questions to ask ?
Senator Wiley. I am very sorry I was not here yesterday, and so
I will only ask one or two questions.
What was the total amount of money that you really donated to the
Governor's campaign fund ; you, yourself ?
Mr. Johnston. $40,000, approximately.
Senator Wiley. And that you said you got out of your strong box?
Mr. Johnston. Yes, sir.
Senator Wiley. Did anyone else contribute toward that $40,000?
Mr. Johnston. No, sir.
Senator Wiley. Was there any requirement under the Florida
statute that when you would pay over a certain amount you would
have to personally make the returns ?
Mr. Johnston. No, sir.
Senator Wiley. And the purpose of this $40,000 was simply that
you felt that through an association of 15 years you were simply
helping a friend out ?
Mr. Johnston. No; the purpose of that $40,000 was to keep my
W'ord. I had promised to help underwrite the campaign. And it
was keeping my word, that I gave possibly the $40,000 under.
Senator Wiley. I understood you to say, however, that back of
giving your word was the fact that you were helping a friend of his.
Mr. Johnston. That is correct.
Senator Wiley. And you had no expectation of any return of
whatever nature for what you were doing ?
Mr. Johnston. No, sir.
Senator Wiley. As to these others that contributed, how did you
happen to give your word that you would go into this undertaking?
Mr. Johnston. As I said yesterday, Mr. GrifRn and Mr. Wolfson
called upon me and asked me if I would help underwrite this cam-
paign fund. They said it was awfully hard to get money for a cam-
paign that they thought wasn't properly financed, but that if we
could put up $25,000 apiece into the campaign fund they could say
that the campaign was well financed, and we would then get a lot
of contributions, and we might possibly get some of our $25,000 back.
As it was, it was just the opposite. Someone had sent out a statement,
as I understand — because I didn't take an active part in this cam-
paign. I told them at the time that I didn't want to take an active
part, that I wanted to help my friend, but I wanted to stay in the
background.
Senator Wiley. This money was turned over, I presume, to a cam-
paign committee.
Mr. Johnston. Yes, sir.
Senator Wiley. And you know nothing about its disposal?
654 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Johnston. No. I believe that this campaign treasurer has
the records.
Senator Kefauver. Mr. Fant testified before the committee.
Where do you stay when you are at Miami, Mr. Johnston?
Mr. Johnston. At the Miami Beach Kennel Club.
Senator Kefauver. You know Abe Allenberg quite well?
Mr. Johnston. I do ; yes.
Senator Kefauver. In what connection have you known him ?
Mr. Johnston. Strictly social. Abe has always been a pretty good
fellow around the beach there.
Senator Kefauver. You never stay at the Wofford Hotel?
Mr. Johnston. At the Wofford Hotel ?
Senator Kefauver. Yes.
Mr. Johnston. I think I stayed there once ; yes. But that would
be in the summer time, or off season, when my apartment was closed
up.
Senator Kefauver. Did you stay at the Boulevard after he moved
over there ?
Mr. Johnston. I may have, if my apartment was closed up. But
I never stayed there when my apartment was open.
Senator Kefauver. Well, whenever your apartment was closed,
what hotel did you usually stay at when you went to Miami Beach?
Mr. Johnston. Well, different hotels. I have stayed at the Saxony.
If it was hot weather, I would go there, since it has been air condi-
tioned. If it was cooler weather, I don't know. I may have stopped
in those hotels. I don't have any one that I stopped at usually, no defi-
nite place.
Senator Kefauver. Do you have an interest in Tropical Park ?
Mr. Johnston. None.
Senator Kefauver. You never have had an interest in Tropical
Park?
Mr. Johnston. Never.
Senator Kefauver. Mr. Johnston, I believe that is all we care to
ask you at this time. And if you would cooperate with us in connection
with your records, within the next 10 days, we would appreciate it.
Mr. Johnston. Senator, I will be happy to cooperate with you at
any time you call on me.
Senator Kefau-ster. And you will be available for any further call
that we may want to make on you ?
Mr. Johnston. I will be, for any future call. And I would like to
at this time put on the record, you know, where you could contact me,
because at different times I am at different places, and I wouldn't like
it to be said that you went to Jacksonville and couldn't find me, and
have that go on the record.
Senator Kefauver. All right, sir. We will .see you and get your ,
addresses in different places. You might as well put them on the I
record. Where can you be contacted ? ■
Mr. Johnston. Well, my summer home is Box 466, Saugatuck,
Mich. I am there until Labor Day. I go back and forth from Chicago.
When I am in Chicago, my Chicago office during the summertime is
the National Jockey Club. They will be able to contact me within 24
or maybe 48 hours in the summertime. In the summertime those race
tracks in Florida are all closed up, and they have all gone away, be-
cause they only operate in the wintertime. You wouldn't never be able ^
»
ORGANIZED CRIME IN INTERSTATE COMMERCE 655
to find me there. And my home is closed up in the summertime. That
is the reason I am making this statement, because if you would call my
office in Jacksonville you would get no information there. You would
just find the w'atchman there.
Senator KEFAim:R. Are there any other addresses?
Mr. Johnston. No. In the wintertime, you can get me at my home
in Jacksonville.
I am going to be in Florida next week, Monday and Tuesday. I
have got a hearing down there.
Mr. Halley. In that case I would like to arrange, while you are in
Florida, for somebody to pick up those records.
Mr. Johnston. All right. What date do you want ?
Mr. Halley. Where can we reach you in Florida, on either Monday
or Tuesday ?
Mr. Johnston. I will be in Miami. I will have to go to Jackson-
ville and dig those up,
Mr. Halley. At what hotel can w^e reach you ?
Mr. Johnston. At the Saxonj^
Mr. Halley. On Monday and Tuesday of next week ?
Mr. Johnston. That is right.
Senator Kefauver. Thank you, Mr. Johnston.
The committee is going to have an executive se,ssion, and we will end
the hearing for today.
(Whereupon, at 4 p. m., the public hearing was adjourned, subject
to call of the chairman, and the committee proceeded into executive
session.)
INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
TUESDAY, SEPTEMBER 19, 1950
United States Senate,
Special Committee To Investigate Organized
Crime in Interstate Commerce,
Washi7igton, D. G.
The committee met, pursuant to call, at 2:45 p. m., in room 457,
Senate Office Building;, Senator Estes Kefauver, chairman, presiding.
Present : Senators Kefauver, O'Conor, Tobey, and Wiley.
Also present : Rudolph Halley, chief counsel ; Harold G. Robinson,
associate counsel; and Alfred Klein, assistant counsel.
The Chairman. The hearing will come to order. The chairman —
and I am sure I speak for the other members of the committee and the
staff — welcome back into the fold, after 2 or 3 weeks' sojourn, our
distinguished colleague from New Hampshire. He has promised to
continue his very faithful service to this committee.
Is Mr. Russell here ? Mr. Russell, do you solemnly swear the testi-
mony you will give this committee will be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Russell. I do.
TESTIMONY OF HARRY RUSSELL, MIAMI BEACH, FLA.
The Chairman. Sit down right over there, Mr. Russell.
Mr. Halley. Wliat is your full name, Mr. Russell ?
Mr. Russell. My full name is Harry Russell.
Mr. Halley. Have you ever been known by any other names?
Mr. Russell. Yes.
Mr. Halley. What are they ?
Mr. Russell. My legal name is Harry Russell.
Mr. Halley. What other names have you been known by ?
Mr. Russell. No other. My birth name was Harry Weinstein.
Mr. Halley. Harry Weinstein?
Mr. Russell. Yes, sir.
Mr. Halley. Any other names?
Mr. Russell. No, sir.
Mr. Halley. You have never used any name except Harry Wein-
stein and Harry Russell ?
Mr. Russell. Not that I recall.
Mr. Halley. How long have you been known as Harry Russell?
Mr. Russell. Since I came — before I went to the Army in 1917.
Senator Wiley. Talk into that so we can hear you.
Mr. Halley. Were you ever arrested ?
657
658 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Russell. Never.
Mr. Halley. Were you ever convicted of a crime?
Mr. Russell. No, sir.
Mr. Halley. What is your address *
Mr. Russell. I beg your pardon ?
Mr. Halley. What is your address? Wliere do you live?
Mr. Russell. I previously lived at 4415 Post Avenue in Miami
Beach. I now live at the Town House Hotel in Miami Beach.
Mr. Halley. The Town House l
Mr. Russell. Yes.
Mr. Halley. You were previously at 4415 Post Avenue?
Mr. Russell. Yes, sir.
Mr. Halley. Do you have any other residence in any other place?
Mr. Russell. In any other town ; no, sir.
Mr. Halley. Mr. Russell, on July 8, 1950, did you see a lawyer named
Luis Kutner?
Mr. Russell. I don't recall just what clay it was.
Mr. Halley. Did you see such a lawyer in Chicago ?
Mr. Russell. He saw me. I didn't see him.
Mr. Halley. Where did you see him ?
]VIr. Russell. In my accountant's office.
Mr. Halley. Who is your accountant?
Mr. Russell. William J. Brantman, B-r-a-n-t-m-a-n. I am not
sure about that. Bill Brantman.
Mr. Halley. Where is Brantman's office?
Mr. Russell. Chicago, on La Salle Street. I wouldn't remember.
Mr. Halley. Wlio was present when you met Kutner? Was Mr.
Brantman present?
Mr. Russell. Yes.
Mr. Halley. Was anybody else present?
Mr. Russell. No.
Mr. Halley. Had you previously known Kutner?
Mr. Russell. I had never known the man before in my life.
]\Ir. Halley. Who introduced you to Kutner?
Mr. Russell. Brantman.
Mr. Halley. Did Brantman suggest that you see Kutner?
Mr. Russell. Oh, yes.
Mr. Halley. On July 19, 1950, this committee when in Florida,
received a telegram purported to come from Harry Russell, which
reads :
Luis Kutner is not my lawyer and never lias been. His release to the press
in the form of a letter to Mr. iludolph Halley, chief counsel for the Senate Crime
Investigating Committee, is a complete fabrication wherein he states that I told
him I feared facing the committee because of the Binaggio case, giving the im-
pression to the public that I was in fear of my life if I testitied. Nothing is
further from the truth. His very statement is an inconsistency in fact and
legal conduct ; could he be my lawyer and at the same time propose to act for
the committee in serving a subpena on nie? His actions could not be called
sympathetic to a client wanted in connection with a crime investigation when
he was holding a subpena calling for my appearance. I would rather call him
an agent of Mr. Halley, or a lawyer seeking publicity at my expense.
Haruy Russell.
Did you send such telegram to this committee?
Mr. Russell. Yes, sir.
Mr. Halley. Addressed to the Honorable Estes Kefauver?
ORGANIZED CRIME IN ESTTERSTATE (COMMERCE 659
Mr. Russell. Yes, sir.
Mr. Halley. Do you still state that Luis Kutner was never your
lawyer ?
Mr. Russell. That is true, very true.
Mr. Halley. He never legally represented you?
Mr. Russell. That is right.
Mr. Halley. So any statement you made to Mr. Kutner would not
be privileged?
Mr. Russell. I beg your pardon. I don't get that.
Mr. HxVlley. You understand that there is a certain privilege be-
tween an attorney and a client. Is it your position that there can be no
privilege that Mr. Kutner would have ?
Mr. Russell. I never at any time hired Kutner for an attorney.
Mr. Halley. So anything you told Kutner
Mr. RtTssELL. Or gave him any fee of any kind.
Mr. Halley. You made no confidential revelations to him?
Mr. Russell. That is right.
Mr. Halley. When you sent that telegram to the committee you did
not include your address or any return address, is that right?
Mr. Russell. That is right.
Mr. Halley. At that time you knew that this committee was seeking
to serve a subpena on you, did you not?
Mr. Russell. That is right.
Mr. Halley. It appeared in the newspapers, did it not ?
Mr. Russell. That is right.
Mr. Halley. You sent this telegram I believe from Chicago.
Mr. Russell. That is right.
Mr. Halley. Had you seen the Chicago papers saying that the
committee souglit your attendance ?
Mr. Russell. I am sorry, sir, I didn't hear you.
Mr. Halley. Had you seen the Chicago newspapers saying that the
committee expected you to attend ?
Mr. Russell. Oh, I
The Chairman. It was evident to you that we were looking for you
and wanting you to attend.
Mr. Halley. INIr. Kutner told you that we had a subpena for you,
is that right ?
Mr. Russell. Mr. Kutner had a subpena for me and I wanted to
go down to Florida to answer the subpena. He had no license to give
me any subpena.
Mr. Halley. Wliy didn't you come to Florida ?
Mr. Russell. I refuse to answer that question on the ground that
the answer may incriminate me.
Mr. Halley. That is no excuse. Is it your posdtion that the
answer would incriminate or tend to incriminate you ?
Mr. Rl^ssell. Would tend to incriminate me, sir.
Mr. Halley. Under any Federal law ?
Mr. Russell. No ; I wouldn't say under any Federal law.
Mr. Halley. I aclvise you that you have no privilege that protects
you from answering a question that might tend to incriminate you
except under Federal law.
Mr. Russell. May I ask a question ? Are you Mr. Halley ?
Mr. Halley. Yes.
660 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Russell. I liave no lawyer and I haven't any legal mind, but I
must have some kind of right, haven't I ?
Mr. Halley. You have a right to refuse to answer any questions
that would tend to incriminate you under a Federal law.
The Chairman. Mr. Russell, who is your lawyer ? Do you have a
lawyer in town ?
Mr. Russell. No, sir ; I haven't. I would like to get one now that I
see the set-up here.
Mr. Halley, You expected to be questioned here today, did you.
not?
Mr. Russell. Yes; and I wanted to answ^er to the best of my
ability.
Mr. Halley, In fact, you surrendered and accepted service of the
eubpena in the offices of Ben Cohen, the attorney for the S, & G.
Syndicate ?
Mr. Russell. I didn't bring him down. I didn't think it was
necessary. I thought it was an executive session. I understood it
so.
Mr. Halley. Mr. Cohen was told that it would be a public session.
Mr. Russell. He didn't tell me.
The Chairman. Anyway, Mr. Russell, the committee doesn't expect
to ask you any questions that you should not answer that would violate
your privilege, but the question Mr. Halley asked, I think I should
advise you. unless it would tend or would incriminate you in con-
nection with a Federal offense as distinguished from a State charge,
you will be required to answer. Of course, if you want to stand on
that, all right, but that is the law.
Mr. Russell. Mr. Chairman, I would like to stand on that. I de-
cline to answer.
The Chairman. Then let us have the record show very clearly the
nature of the question. We will have the reporter read the question
again so it will be very clear.
(The reporter read the question and answer, as follows:)
Mr. Halley. Why didn't you come to Florida?
Mr. Russell. I refuse to answer that question on tlie ground that the answer
may incriminate me.
The Chairman. Let's reframe the question.
Mr. Russell. Senator Kef auver, may I ask again, did I answer that
the way I should answer it in the legal phrase ? I have no attorney.
I am asking one of you gentlemen.
The Chairman. We understand you are not an attorney, ISIr.
Russell.
Mr. Halley. May I interpose, the witness is affecting an ingenuous-
ness in his answers which creates the problem that throughout this
examination in the event important matters are developed, the wit-
ness will always have the retreat, the point that he had no lawyer
present. I believe I would like to take the position as counsel exam-
ining this witness that if he wants to have counsel representing him.
he should have a reasonable opportunity to get such counsel, although
I think he is in default in not having provided himself with counsel
before his appearance here right now.
Mr. Russell. Mr. Halley
II
0;RGAmZED CRIME! in INTERSTATE COMMERCE 661
The Chairman. Mr. Russell, the opinion of the Chair is that you
would be subject to Senate contempt for refusin<; to answer the ques-
tion that has been asked you. Of course you are a layman, and we
want you to have every right that you want and have every right
that you are entitled to. We take the position that in your appearance
before his committee if you want an attorney you are entitled to have
one. While you have inconvenienced the committee a great deal by
coming here without your attorney when you should have anticipated
that you would be asked questions which you w^ere going to refuse to
answer on the ground that it might or would incriminate you, you
should have had legal representation here.
If you want an opportunity, a day, to get your attorney to advise
with you on these matters, w^e will give you that opportunity, Mr.
Russell.
Mr. Russell. When would that be, Mr. Kef auver ?
The Chairman. What is that?
INIr. RcssELL. When would I have to come back? I don't know
when 1 could get my attorney here or an attorney. I would like to
look around.
The Chairman. We would like to carry on the session tomorrow if
you can get an attorney in the meantime or can advise with an attorney.
Mr. Russell. Well, sir, tomorrow is a holiday. The attorney that I
might want to get may not want to be here tomorrow. Is that true,
Mr. Halley?
Mr. Halley. I don't know what attorney you want to get. I have
no way of knowing.
Mr. Russell. I don't want to duck or hide behind anything, Mr.
Halley and Senator Kefauver. I don't think that I don't have any
rights.
The Chairman. That is the reason we are trying to give you a chance
to get an attorney to advise you of your rights, if you want to get one.
If you are going to refuse to answer certain questions, you should have
had an attorney here to advise you, Mr. Russell. We clon't want to put
you in the position of not knowing whether you have a right to stand
on certain refusals to answer or not. It is the opinion of the Chair
that your refusal to answer Mr. Halley's last question places you in
contempt of the Senate. You do not have an attorney here and we
want to give you an opportunity of advising with one. The Chair has
in mind recessing the meeting until 10 o'clock tomorrow if you will
advise with one.
Mr. Russell. I doubt whether I could get an attorney in that short
a time.
Mr. Halley. Mr. Chairman, I think the witness' point is that Thurs-
day is the Jewish high holy day, Yom Kippur, and it begins at sundown
tomorrow. I think he feels that he coulcl not get the attorney he wishes
to represent him tomorrow. Whether that is so or not, I don't know.
Thursday is a holiday.
Mr. Russell. I don't particularly care to hide behind anything like
that. If I get in trouble, let's go on. I think I have some rights as an
American. I must have some kind of a right.
Mr, Halley. You had better find out what it is.
Mr. Russell. I know I am up here arrayed against a lot of legal
talent.
662 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. Will you have your attorney here Thursday ?
Mr. Russell. I will try. Could you delay it a week or so, Senator ?
The Chairman. No.
Mr. Russell. Then let's go on.
The CHAHtMAN. We have delayed a long- time, Mr. Russell, trying
to find you.
Mr. Russell. I feel that that question, if the answer would tend to
incriminate me
The Chairman. Mr. Russell, if you want to get an attorney we will
recess this meeting and you will stand under subpena until 10 o'clock
Friday. We leave the matter with you. You must tell your attorney
and you must understand that if it is carried over until 10 o'clock Fri-
day there will be no further continuance, that you will be expected to
testify at that time. I feel for your own good you should get yourself
an attorney to advise you.
Mr. Russell. I don't know. If any attorney would advise me to
answer that question, I believe my answer would be the same, sir.
The Chairman. I am not advising you to answer it or not to answer
it. I can only say that the chairman will recommend to the commit-
tee that you be cited for contempt of the Senate in case you did not
answer it. What the committe would do I don't know, but I think
under all the circumstances probably it would be well for you to get an
attorney and to appear here at 10 o'clock on Friday. You will stand
under subpena until that time and be here at 10 o'clock.
The meeting will be recessed until 10 o'clock on Friday.
(Whereupon, at 3 :10 p. m. the hearing was recessed until 10 a. m.
Friday, September 22, 1950.)
INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE
COMMERCE
FRIDAY, SEPTEMBER 22, 1950
United States Senate,
Special Committee To Investigate
Organized Crime in Interstate Commerce,
Washington, D. C.
The committee met, pursuant to recess, at 10: 15 a. m., in room 457,
Senate Office Buildino;, Senator Estes Kef auver (chairman) , presiding.
Present : Senators Kefauver, Tobey, and Wiley.
Also present : Rudolph Halley, chief counsel ; Harold G. Kobinson,
associate counsel ; and Alfred Klein, assistant counsel.
The Chairman. The committee will come to order.
Before proceeding with hearing Mr. Russell, I wish to say, that in
the first place, the members of the Senate committee are delighted that
the house of delegates of the American Bar Association voted without
opposition to instruct the president of the American Bar Association
to appoint a commission to be composed of seven members to assist
and cooperate with, and to advise with the members of the Senate
committee.
We have been advised and it is carried in the press this morning that
former Secretary of War, Robert Patterson, a distinguished New York
attorney, is to be chairman of that commission. The committee wel-
comes his assistance. We welcome the confidence that has been shown
in our committee by the appointment of this commission of the Ameri-
can Bar Association. Senator Wiley and I have been discussing the
matter, and we will invite Secretary Patterson and his commission to
meet with us at the very earliest possible time to outline a program of
cooperation, and to set up the means of working together with this
commission.
We will of course welcome their assistance, their suggestions, and
we tliink that by joining our efforts with this distinguished group, we
can do much toward better law enforcement, and toward taking some
steps to thwart organized crime in interstate commerce.
Senator Wiley, do you wish to make any comment in connection
with the American Bar Association commission before we proceed?
Senator Wiley. I think it indicates quite clearly that the American
Bar is conscious of the challenge that exists in this country to the
very safety of the Nation. I was up there yesterday with one of the
groups, and I was very much impressed with the tremendous sincerity
of this fine group of citizens, who realize that if we remain a Nation
of law and order, we have to have the cooperation of all groups in this
country. They not only recognize the impact of foreign "isms" on
663
689r,8— 50— pt. 1—43
664 ORGANIZED CRIME IN INTERSTATE COMMERCE
the integrity of the country, but also the impact of the deteriorating
forces that we are seeking to investigate here.
I am very happy to note on this very commission is one of Wiscon-
sin's distinguished citizens, Pliillip Haberman, executive secretary of
the Wisconsin Bar Association at Madison. \\\\o will be present. I am
sure, on all occasions, and lend his ability to see if we can tind a sohi-
tion to the challenges which really affect our Nation, and the social,
economic, and political health of our society. 1 am indeed grateful
that the bar again has indicated its high standard of service.
The Chairmax. Thank you. Senator Wiley.
Since you have gotten into the matter of members from the State
of Wisconsin, I think I would be missing an opportunity if 1 did not
mention the fact that the State of Tennessee also has a distinguished
lawyer who has been named to this commission. Walter P. Armstrong,
Jr., of Memphis. Mr. Armstrong's father was president of the Ameri-
can Bar Association a few years ago. He was a very distinguished
Tennessee lawyei", and his son is a very capable man in his field.
The chairman also wishes to announce that over a period of several
weeks the staff of the committee has been investigating very important
interstate gambling transactions of substantial magnitude in northern
New Jersey, which has interesting connections, according to our pre-
liminary investigation.
In that connection the staff of the committee has been serving sub-
penas on quite a number of people who are alleged to have connections
with this operation and has succeeded in serving subpenas on some
well-known alleged racketeers who we find from our preliminary in-
vestigation were connected with this operation.
After diligent effort, the committee staff has not been able to serve
subpenas on Joe Adonis, sometimes known as Joe Doto, and Jerry
Catena. Apparently these two witnesses, who are important wit-
nesses in the matter that is under investigation, are avoiding service
of subpena. There is a possibility that they may not have been advised
that they were being sought by the committee, and in order that they
may be advised, I do hope that the press and the radio will let it be
known that the committee wishes these two men, Joe Adonis and
Jerry Catena, in connection with this investigation.
A hearing will be held on this matter just as soon as we can work
out our schedule to take care of it. We have some other obligations
that must come first.
FURTHER TESTIMONY OF HARRY RUSSELL, MIAMI BEACH, FLA.
Mr. Russell, you have been sworn, and althougli the committee has
gone to some inconvenience by being unable to let you in earlier to
testify, we Avere happy to recess tlie meeting over for several days in
order to enable you to get counsel if vou wished. Do you have counsel,
Mr. Russell, today '^
Mr. Russell. I haven't counsel, Mr. Chairman.
The Chairman. Let us take any pictures right now, and then we
will go on.
You are here ready to testify, and you have had an opportunity of
getting counsel?
Mr. RussKLL. That is right.
The Chairman. All right. Mr. Halley, will you proceed?
ORGAISriZED CRIME! IN INTERSTATE OOIMMERCE 665
Mr. Hallf.y. Mr. Kussell, when the hearing closed on Tuesday —
are the photographers bothering you ?
Mr. RussEix. Yes, they are.
The Chairman. All right, let us take any pictures right during
the next minute or two, and then in deference to the proceedings 1
will ask you to desist.
Mr. Halley. Now, Mr. Russell, when the hearing closed last Tues-
day the question to you was: Why did you fail to come to Florida
to appear before this committee when you knew that the committee
was seeking your attendance? Will you answ^er that question?
Mr. Russell. I decline to answer that question on the grounds that
the answer may incrimiiiate me.
Mr. Halley. I advised you, too, that is no excuse, Mr. Russell.
Have you in mind any Federal basis of prosecution that would result
from your answering that question ?
Mr. Russell. I decline to answer that question on the grounds that
the answer may tend to incriminate me, Federal and State.
Mr. Halley. You contend that the answer would tend to incrim-
inate you?
Mr. Russell. May tend to incriminate.
Mr. Halley. Do you say it would tend to incriminate you?
Mr. Russell. It may tend to incriminate me.
The Chairman. Let us make the record. The Chair rules that
you have no right to decline to answer that question. We have given
you every opportunity of getting counsel. So you must be advised
of the circumstances and what may result as a result of your not an-
swering questions Avhich we think Ave have a right to ask you.
To make the record, Mr. Hal]e3% the counsel for the committee
in the opinion of the Chair, is correct in his interpretation that you
have no right to refuse to answer that question.
Mr. Russell, we try in this committee to see that the rights of peo-
ple are protected. The chairman and members of the committee
may be incorrect in their ruling on the question asked by the counsel.
Counsel has the same attitude of not wanting to ask questions which
you should not be required to answer. We will do our best to try
to see that no questions are asked you that are not proper questions,
but you must be advised that the refusal to answer proper questions
will not be treated lightly by the committee.
Proceed, Mr. Halley.
Mr. Halley. I take it you persist in your refusal to answer, Mr.
Russell ?
Mr. Russell. I don't just get that.
Mr. Halley. Do you still refuse to answer?
Mr. Russell. I decline to answer that question on the ground
that it may incriminate me, yes.
Mr. Halley. Two months later you decided that you would accept
service of this committee's subpena, is that right ? You are here today.
Mr. Russell. Yes.
The Chairman. Speak up so we can hear you.
Mr. Russell. Yes.
Mr. Halley. Is there any change in conditions that made you decide
2 months later that you would come in here and appear before this
committee?
666 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. lis it not a fact, Mr. Russell, that when this committee
first sought to have you appear, you did confer with Luis Kutner, a
Chicago lawyer?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. I want to warn you again that your declining to an-
swer each of the questions as you have just declined is improper. You
have not shown the committee any possibility, even a remote possibility,
that the answers to those questions might be connected with the possi-
bility of your being incriminated under any law of the United States.
Mr. Russell. My position is still the same.
Mr. Halley. As a matter of fact, you haven't shown that you would
even be incriminated under any law of any State with regard to those
questions. Do you still persist in your answer ?
Mr. Russell. I do.
The Chairman. You say you do ?
Mr. Russell. Yes, sir. I decline to answer any question that may
tend to incriminate me in any court.
Mr. Halley. We understand.
Is it not a fact that before deciding whether you would appear before
this committee last July, you went to see Jake Guzik to discuss with
him whether or not you w^ould appear?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. Do you know Jake Guzik ?
Mr. Russell. I decline to answer that question on the same ground.
Mr. Halley. I advise you again that your answer to the last two
questions in the opinion oi counsel to this committee are arbitrary and
capricious and are not based on any proper and sincere view that you
might be incriminated or would be incriminated under any law, State
or Federal. Are you aware of that?
Mr. Russell. Is that in the form of a question ?
Mr. Halley. That is in the form of advice. I want to know if you
understand my advice to you. You are aware of what I am telling you,
that the committee considers j^our answers to be arbitrary?
Mr. Russell. I am listening to you.
Mr. Halley. You hear me, do you ?
]Mr. Russell. Yes, sir.
Mr. Halley. Fine.
Senator Wiley. Is the answer you have given based on a sincere feel-
ing that you will incriminate yourself or that you are afraid that you
might be committing suicide?
Mr. Russell. Well, I would like to get that question again. Senator.
Senator Wiley. Read the question.
(Question read.)
Mr. Russell. It is based on a sincere feeling that I will incriminate
myself.
Senator Wiley. Do you think you might be incriminating someone
else?
Mr. Russell. I am not concerned with someone else at this minute,
sir. I am just concerned with myself.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 667
Senator Wiley. Have any threats of violence been made against
yon ?
Mr. Russell. No.
Senator Wiley. Have you consulted with anyone since you were
last in this room some 3 days ago?
Mr. Russell. I decline to answer that question for the same reason
as previously indicated.
Senator Wilei-. Your refusal to answer is going to be interpreted
by many people as meaning that you prefer to go to jail because of
contempt citation of Congress rather than to face the music insofar
as some of vour associates are concerned. What do you think of that
conclusion f
Mr. Russell. Senator, it isn't what I think. I think I have some
rights in this good old land of ours.
Senator Wiley. Are you a citizen of this great country?
Mr. Russell. I should say I am. I fought in the war of 1918.
Senator Wiley. If you fought in the war of 1918, do you not think
you owe some res])onsibility to this country to see to it that the crim-
inal guys, the bigsters in crime, do not termite this Nation?
Mr. Russell. I don't think, Senator, that I have committed any
crime.
Senator Wiley. That is not my question. I am asking whether now
that you have fought for this country, whether you do not feel that
you owe some obligation to preserve this country from infiltration by
crimesters, those termites that would really destroy the citadel? If
you fought for this country, why don't you fight for her now ?
Mr, Russell. I believe that I have some rights.
Senator Wiley. Do you not realize that while you have rights, also
there is a right to serve the Nation, to preserve its integrity ?
Mr, Russell, There is a right to serve the Nation, and I am always
willing to serve the Nation, and I am willing to serve this body to the
best of my ability, but I positively refuse to incriminate myself, I
believe I have that right.
Senator Wiley, That is, you think there are two loyalties involved
now, one to yourself and one to the Nation
Mr. Russell. I believe that is what the Constitution says.
Senator Wiley, What is that ?
Mr. Russell. I believe the Constitution says that we have that
right.
Senator Wiley, Who informed you of that ?
Mr, Russell. I have been reading it ever since I have been a boy,
since I went to the fii'st grade.
Senator Wiley. Let us go back to the original proposition. Appar-
ently you served in the war of '98 ?
Mr. Russell. No, sir ; don't take me back that far.
Senator Wiley. 1918.
Mr. Russell. Yes, sir.
Senator Wiley. I thought you were out with Teddy. Instead of
that you were out with F, D. R,
Mr. Russell. My dad was out with Ted.
Senator Wiley. We are talking about two loyalties. You fought
for the Nation, and apparently your idea there was to preserve the
Nation from the attack from without.
668 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Russell. And I ^Yill do it again.
Senator Wiley. According to what you heard this morning the
bar association recognizes there is an attack from within. They are
going to cooperate with us. Why can you not cooperate with us?
Mr. Russell. Senator, I am trying to cooperate with this body,
but if I am to cooperate with this body and incriminate myself, I
don't believe that is right.
Senator Wiley. Do you realize that in fact by refusing to testify
you are impeding the processes of the United States Congress ?
Mr. Russell. I refuse to answer that question for the same reason,
sir.
Senator Wiley. Do you think it proper to sabotage the legislative
jDrocosses as you are doing here ?
Mr. Russell. I refuse to answer that for the same reason.
Senator Wiley. Have any threats of violence or force been made
against you if you did testify?
Mr. Russell. No, sir.
Senator Wiley. Before you became the sixth member of the S. & G.
Syndicate, it seems that just by coincidence the racing wire services
were cut. We interpret that as pressure of Chicago mobs to force the
Miami group to admit you.
Do you know anything about the cutting of that wire service to the
Miami group?
Mr. Russell. I refuse to answer that question on the ground that it
may incriminate me.
Senator Wiley. Do you know anything about threats of violence
whicli might have been made to the S. & G. Syndicate, Miami, unless
it took you in as the sixth partner?
Mr. Russell. T decline to answer that question.
Senator Wit-ey. Do you not regard it strange that the S. & G.
Syndicate, which seemed to be getting along perfectly well without
jour services, should all of a sudden have you join that syndicate?
Mr. Russell. I decline to answer that question.
Senator Wiley. That was not a coincidence, was it?
Mr. Russell. I decline to answer that question.
The Chairman. The Chair orders you, ISIr. Russell, to answer the
questions relative to the S. & G. Syndicate that Senator Wiley has
just asked you, that is, the Chair instructs you that you are not en-
titled to refuse to answer those questions on the ground that they
would incriminate you, and orders you to answer them. Do you
refuse to complv with the order of the Chair?
Mr. Russell.' Is that, sir, a question put to me ?
The Chairman. Yes, sir. Do you refuse to comply with the order
of the Chair and to answer those questions?
Mr. Russell. I decline to answer any question that may tend to in-
criminate me. . 1 1 1 p .1
The Chairman. Then you refuse to comply with the order ot the
chairman to answer the questions that you have been asked by Sena-
tor Wiley relative to your connection with the S. & G. Syndicate ?
Mr. Russell. I decline to answer that question on the grounds
that it may tend to incriminate me, sir.
Senator Wiley. Do you want to tell us what you mean by incrim-
inating you ?
ORGANIZED CRIME IN INTERSTATE COMMERCE 669
Mr. Russell. I just would not know how to answ^er that, sir.
Senator Wiley. Then you are simply repeating
Mr. Russell. I am bound to be incriminating myself, I know
through the direct or indirect efforts of this connnittee that I have
been indicted in the State of Florida. I don't care to incriminate
myself, and that seems to be my answer, sir.
Senator Wiley. Do you realize that at least by many people your
refusal to answer these questions will be interpreted as meaning that
you prefer to go to jail because of a contempt citation of Congress,
rather than to face the music insofar as the gang you have been
associated with ?
Mr. Russell. I decline to answer that question, sir, on the same
grounds.
Senator Wiley. Can you tell me what individuals in Chicago con-
tacted you relative to your entrance into the S. & G. Syndicate in
Miami ?
Mr. Russell. I decline to answer that question on the grounds pre-
viously indicated.
The CiiAiRMAisr. The Chair orders you to answer. Do you refuse
to obey the order of the Chair?
Mr. Russell. I don't refuse to obey an order, but I decline to an-
swer a question that may incriminate me, sir.
The Chairman. Anyway, regardless of what the Chair advises you,
the Chair has advised you you must answer, and you refuse to an-
swer; is that correct?
Mr. Russell. That is my answer.
The Chairman. That is correct, you say?
(No response.)
Mr. Halley. I just want to advise you on a legal basis that unless
you take the position that the answer would tend to incriminate you,
not "may,"' and that it would tend to incriminate you of a violation
of some law of the United States, that your answer must be given,
and that your contention of a constitutional privilege is of no avail.
Mr. Russell. May I get that again ?
Mr. Halley. I just want to make sure before you persist in your
refusal to answer Senator Wiley's further questioning, that you under-
stand the law.
Mr. Russell. I understand the law this way; I may have some
rights, Mr. Senator.
The Chairman. Let me interrupt and let counsel explain the law to
you so you can have a clear understanding of it. All right, Mr. Halley.
Mr. Halley. Mr. Russell, you must answer the questions unless you
can contend, and contend with some basis, that the answer would
tend to incriminate you under some law of the United States of
America.
Mr. Russell. That is just exactly what I mean, sir.
Mr. Halley. The Federal Government.
Mr. Russell. Yes, sir; both.
The Chairman. That is, if it might incriminate you under some
State law", then you have no right to refuse to answer. We are not
concerned with State laws. Your privilege goes to incrimination
under Federal laws, not State laws. You understand that clearly?
Mr. Russell. I understand that that is your theory of it, sir.
670 ORGANIZED CRIME IN INTERSTATE COMMERCE
The Chairman. All rio;ht. Have you consulted with an attorney
since you were here last Tuesday?
Mr. KussELL. I decline to answer that question on the same grounds,
that it may incriminate me.
The Chairman. The Chair orders you to answer that question.
Do you refuse to obey the order of the Chair ? Yes or no '?
Mr. Russell. I have consulted an attorney, I have consulted
several attorneys.
I would like to inform the Chair they think just as the Chair does.
The Chairman. Who did you consult with?
Mr. Russell. I decline to answer that. It may tend to incrim-
inate me.
The Chairman. You say that the attorneys have the same opinion
that the Chair does ?
Mr. Russell. Yes, sir ; all of them.
The Chairman. What ?
Mr. Russell. All of them.
The Chairman. All of them advised you just as the Chair has?
Mr. Russell. That is right.
The Chairman. Do you refuse to advise the Chair what attorneys
you have consulted w^ith ?
Mr. Russell. I decline to answer. It may tend to incriminate me.
The Chairman. Go ahead and ask the questions, Mr. Halley.
Senator Wiley. Were those attorneys located in Chicago, Miami, or
AYashington ?
Mr. Russell. In Washington.
Senator Wiley. You think giving their names would incriminate
you ?
Mr. Russell. It might.
Senator Wiley. Were they attorneys that you had consulted be-
fore ?
Mr. Russell. No.
The Chairman. Speak up, Mr. Russell.
]\Ir. Russell. No, sir, they weren't attorneys that I had consulted
before.
Senator Wiley. If you had never seen them before, how did you
hapi^en to get their names ? Who advised you ?
Mr. Russell. I decline to answer that question on the same grounds.
It may lead to a question that may tend to incriminate me. Senator
Wiley, I don't want to be obstinate or stubborn in this thing, but I do
want to protect my own rights, if I can.
Senator Wiley. I have to leave. I just want to say, Mr. Russell,
that while I would not ask anyone to give up any right, I want to
appeal to you as a veteran of this great country that you are anxious
to assist this great Government that you served in the war. Appar-
ently under the advice of somebody you have visited a lawyer. We
are seeking to get information on this subject, and you impose the
incrimination feature. I am appealing to you as a veteran of this great
Nation to come to the assistance of the Nation. We are all in the
same boat, trying to clean the house. You are in a position to give us
information and there is no reason why, if you are an American, that
information should not be forthcoming. Even if it should incriminate
you, can you wot sense that there is a need here of your country that
should be met and that you can meet? If your answer to that is the
ORGANIZED CRIME' IN INTERSTATE COMMERCE 671
same, I ask you again, is it because you are fearful that somebody will
rub you out if you answer the truth '^
Mr. Russell. No, sir.
Senator Wiley, It is just because of your own little selfish desire
to protect your ow^n hide. Is that it?
Mr. Russell. What is selfish about wanting to protect your own
rights ? What is selfish about that situation ?
Senator Wiley. Did you get an honorable discharge from the
Army ?
Mr. Russell. I certainly did, and I am just as proud of it as any
man that was ever in the Army.
Senator Wiley. Do you not want to keep that honorable discharge
still honorable?
Mr. Russell. Positively.
Senator Wiley. By coming to the aid of your county.
Mr. Russell. Positively aiicl I defy anyone to try to take away that
honorable discharge.
Senator AVile^'. You can lose your citizenship, too,
Mr. Russell, [f I can lose m^ rights and my citizenship because I
don't care to incriminate myself. Senator, I am sorry. I just have to
take it.
The CHAiRMAisr. Is there anything further. Senator Wiley?
Mr, Halley, will you ask any further questions that you may have?
Mr, IIalley. What is your business ?
Mr. Russell. I decline to answer that question on the same grounds.
Mr. PIalley. What is the ground, that it w^ould incriminate you ?
Mr. Russell, That the answer may tend to and would or could
incriminate me, anyway,
Mr. PIalley. You have been advised several times that the grounds
you must assert is that the answer w^ould tend to incriminate you
under some Federal law.
Mr, Russell, Would tend to incriminate me is the right words;
yes,
Mr. Halley, Do you say that your present business, the answer to
that question would incriminate you under some Federal law ?
Mr, Russell. I decline to answer that question as previously in-
dicated.
Mr. Halley. Were you ever in business with Tony Accardo ?
Mr, Russell, I decline to answer that question as previously in-
dicated. The records you have
Mr. Halley. Were you saying something ?
Mr. RiTssELL. With the records you have, you know w^hat they are.
I decline to answ^er any questions that might tend to incriminate me
in any way.
Mr. Halley. I am now referring to a period prior to 1940, before
the possibility of your being incriminated because of the statute of.
limitations. I am referring to a period no less than 10 years ago ; prior
to 1040, were you ever in the bookmaking business with Tony Accardo
in Chicago ?
]\Ir. Russell. I decline to answer that question.
Mr. PIalley. You know you w^ere in the bookmaking business with
Tony Accardo, were you not ?
Mr. Russell. I decline to answer that question, sir.
672 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Halley. Were you ever in business with Charley (Cherry
Nose) Joye?
Mr. Russell. I decline to answer that question on the ground tliat
it may tend to incriminate me.
Mr. Halley. Were you ever in business before 1940 with Charlie
(Cherry Nose) Joye?
Mr. Russell. I decline to answer that question.
Mr. Halley. Have you known Tony Accardo ?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. Did you ever see Tony Accardo ?
Mr. Russell. I decline to answer that question, as previously in-
dicated.
Mr. Halley. Did you ever see Charlie (Cherry Nose) Joye?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. At this point I want to ask the Chair to order the
witness to answer the questions that have been asked so far.
The Chairman. The Chair instructs you that these are proper
questions, Mr. Russell, and that you have no right to refuse to answer
them, and orders you to answer them. Will you or will you not
comply with the order of the Chair ?
Mr. Russell. I would like to abide by the order of this court, the
Chair, as much as I can, but I think that the question may tend to
incriminate me
The Chairman. Mr. Russell, let's get it straight. The Chair and
this committee have no desire to impose on you, to ask any questio)is
or to ascertain any information that it is not entitled to,
Mr. Russell. I appreciate that.
The Chairman. The Chair feels that we are entitled to answers to
the questions previously asked by counsel, whether you were in busi-
ness prior to 1940 with Tony Accardo, with Charlie Joye, whether you
knew Tony Accardo and Charlie Joye. The Chair has ordered you
to answer those questions. Will you or will you not abide by the
ruling of the Chair? That is, will you answer them or will you not?
Mr. Russell. I decline to answer the questions on the grounds that
they may tend to incriminate me.
The Chairman. Proceed, Mr. Halley.
Mr, Halley. You know that Tony Accardo has frequently been
referred to in the newspapers as the successor to Al Capone and Frank
Nitti as the head of the Capone syndicate in Chicago. Do you not
know that?
Mr. Russell. I decline to answer that question on the same ground.
Mr. Halley. I am simply asking you if you ever read it in the
newspapers.
Mr. Russell. I decline to answer that question.
Mr. Halley. You know that Tony Accardo in 1931 and your f onner
partner, Charles Joye, were arrested for carrying concealed weapons
together, do you not?
Mr. Russell. I don't recall anything like that.
Mr. Halley. You do recall that they were both partners of yours.
Mr. Russell. I decline to answer that question on the grounds that
it may incriminate me.
ORGANIZED CRIMD IN INTERSTATE COAIMERCE 673
Mr. Hai.i.ey. You know that i'io;ht now Tony Accardo is under in-
dictment in connection with a jiarole scandal resulting from the parole
of Charles Joye and Paul DeLucia and others in being paroled from
a Federal penitentiary. Do you know that^
Mr. Russell. No, sir ; I don't know that.
Mr. H ALLEY. Do you have a brother, Dave Russell?
Mr. Russell. Yes.
Mr. Halley. Have you ever seen him ?
Mr. Russell. I haven't seen him in several years, the last 2 or 3
years.
Mr. Haij.ey. Were you ever in business with Dave Russell?
Mr. Russell. I decline to answer that question on the grounds that
the answer may incriminate me.
Mr. Halley. Do you know whether or not your brother, Dave
Russell, Tony Accardo, and others were indicted in Chicago in 1943 ?
Mr. Russell, I decline to answer that question for the reasons pre-
viously indicated.
Mr. Halley. Do you know Ralph Pierce?
Mr. Russell. I decline to answer that question on the grounds that
it may incriminate me.
Mr. Halley. It is a fact, is it not, that you were in the bookmaking
business with Ralph Pierce ?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. Did you ever hear that Ralph Pierce, Tony Accardo,
and others were arrested in connection with a murder investigation
in Chicago in 1943?
Mr. Russell. I never heard anything of the kind.
Mr. Halley. You have not?
Mr, Russell. No.
Mr. Halley. Did you ever hear that Ralph Pierce was in the book-
making business?
Mr. Russf:ll. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Hallet. Were you ever in the premises at 400 South State
Street in Chicago, 111. ?
Mr. Russell. Yes.
Mr. Halley. You had a business there, did you not?
Mr. Russell. I did.
Mr. Halley. You had a bookmaking business there, too; did you
not?
Mr. Russell. No ; I didn't.
Mr. Halley. W^hat business did you have at 400 South State Street ?
Mr. Russell. I had a restaurant.
Mr. Halley. What was the name of the restaurant? '
Mr. Russell. Russell's Silver Bar.
Mr. Halley. Were there other offices in that building?
Mr. Russell. Of course there were offices. It was an office building.
Mr. Halley. Did Ralph Pierce have an office in that building?
Mr. Russell. I decline to answer that question on the grouncl that
the answer may tend to incriminate me.
Mr. Halley. Did you ever hear of the Retail Clerks Protective
Association?
674 ORGANIZED CRIME! IX INTERSTATE COMMERCE
Mr. Russell. I don't recall. I may have.
]Mr. Halley. Did they have space in 400 South State Street ?
Mr. Russell. I never had much to do with the building upstairs. I
don't recall what offices were in there or w^ho was in there at the time.
Mr. Halley. Did you ever hear of the labor extortion racket in
Chicago and elsewhere?
Mr. Russell. In Chicago and elsewhere?
Mr. Halley. Yes. Do you know that your former partner
Mr. Russell. I wouldn't know what to call extortion. I just don't
get that.
Mr. Halley. Do you know what your former partner, Charles Joye,
went to jail for?
Mv. Russell. I do not.
Mr. Halley. It was for extorting money from the moving-picture
industry, was it not?
Mr. Russell, I don't know.
Mr. Halley. Joye was your former partner in the book-making
business, was he not ?
Mr. Russell. I decline to answer that question on the grounds that
the answer might tend to incriminate me.
Mr. Halley. For your information, he so testified here under oath.
Does that help any ?
Mr. Russell. I decline to answer that question.
Mr. Halley. Were you ever in business with Lawrence Imburgio?
Mr. Russell. I beg your pardon ?
Mr. Halley. Were you ever in business with Lawrence Imburgio ?
Mr. Russell. I decline to answer that question qu the grounds
that it may tend to incriminate me.
Mr. Halley. Is it not a fact that you were in the book-making
business with Imburgio ?
Mr. Russell. I decline to answer that question, as previously
indicated.
]Mr. Halley. Were you ever in business at 186 North Clark Street,
Chicago, 111.?
Mr. Russell. I decline to answer that question.
Mr. Halley. Did you ever hear of the Ogden Smoke Shop?
Mr. Russell. I don't recall.
Mr. Halley. Is it not a fact that you ran a bookmaking business
at the Ogden Smoke Shop
Mr. Russell. I decline to answer that question on the ground that
it may tend to incriminate me.
Mr". Halley. Don't you think you should wait to decline until the
question has been finished, out of courtesy to this Senate committee,
if for no other reason ?
Mr. Russell. I am sorry, sir.
Mr. Halley. Were you ever in the bookmaking business at the
Ogden Smoke Shop at 18G Clark Street, Chicago, 111.?
Mr. Russell. I decline to answer that question on the ground that
the answer may tend to incriminate me.
]Mr. Halley. Were you ever in business at the Drive Club, 210
North Wabash, Chicago, 111.?
Mr. Russell. I decline to answer that question on the grounds that
the answer may tend to incriminate me.
ORGANIZED CRIME IN INTERSTATE COMMERCE 675
Mr. Halley. Isn't it a fact that you ran a bookmaking business at
the Drive Chib, 210 North Wabash, Chicago, 111.?
Mr. Russell. I decline to answer that question, as previously indi-
cated.
Mr. Halley. Were you ever in business at 22 East Lake Street,
Chicago, 111. «
Mr. Russell. I decline to answer that question on the same ground.
Mr. Halley. Isn't it a fact that you were in the bookmaking busi-
ness at 22 East Lake Street, Chicago, 111. ?
]Mr. Russell. I decline to answer that question on the grounds as
previously indicated.
Mr. Halley. Were you ever in the bookmaking business?
Mr. Russell. I decline to answer that question on the grounds as
previously indicated.
Mr. Halley. Were you, ever in the bookmaking business as much as
20 years ago?
Mr. Russell. I decline to answer that question as previously indi-
cated.
Mr. Halley. You seeui to be familiar with your rights. Are you
aware of the fact that there is a statute of limitations on the crime of
bookmaking?
Mr. Russell. I am aware of the fact that I decline to answer any
question that may tend to incriminate me.
Mr. Halley. Were you ever in the business of taking lay-off bets ?
]Mr. Russell. I decline to answer that question.
Mr. Halley. Do you know Tony Gizzo in Kansas City?
Mr. Russell. I don't recall.
Mr. Halley. Have you ever met Tony Gizzo?
Mr. Russell. I don't recall.
Mr. Halley. For your information, he is a very important Mafia
figure ill Kansas City. Does that help you?
Mr. Russell. I don't recall.
Mr. Halley. You don't recall whether you know him at all?
Mr. Russell. No, sir.
Mr. Halley. Did 3^ou ever take lay-off bets from Tony Gizzo in
Kansas City?
Mr. Russell. I decline "^d answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. If Charles Joye testified before this committee in a
closed session that you took laj'-off bets from Tony Gizzo in Kansas
City, would have been telling the truth or perjuring himself?
Mr. Russell. I decline to answer that question on the ground that it
may tend to incriminate me.
Mr. Halley. Do you know Charley Carrola in Kansas City ?
Mr. Russell. No, sir, I don't recall knowing him ; no sir.
Mr. Halij^y. Did you ever take lay-off bets from Charley Carrola ?
Mr. Russell. I don't want to answer any questions that may tend to
incriminate me, sir.
Mr. Halley. I have advised you several times that the fact that a
question may tend to incriminate you is no excuse for not answering.
Your excuse must be that it would tend to incriminate you under some
Federal law of the United States of America.
676 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Russell. I realize that you are trying to confuse me, and I
don't want to answer any questions that may tend to incriminate me,
sir.
Mr, Halley. I don't think you are confused at all. You. have come
liere and told this committee that several lawyers have told you exactly
what the chairman told you, that you must answer questions. You
told Senator Wiley at one point that you have committed no crime,
but you sit there just repeating pretty much like a parrot or a monkey
that you don't want to answer questions. You are not confused. You
just don't want to talk. That is not a question, but isn't that a fact ?
The Chairman. Mr. Russell, have you talked with Tony Accardo
and Joye and Ralph Capone, Pierce, or Levine, within tlie last 60
days?
Mr. Russell, Some of the people you are talking about, I don't know.
The Chairman. Have you talked with any of them in the last 60
days ?
Mr, Russell, I decline to answer that question on the grounds that
the answer may tend to incriminate me.
Mr. Halley. Did you ever hear that Charles Gargotta talked before
a grand jury and then was killed?
Mr. Russell. I beg your pardon, sir ?
Mr. Halley. Did you ever hear of Charles Gargotta?
Mr. Russell. I have read of him in the newspapers.
Mr. Halley. Did you read how he was killed after he talked before
a grand jury?
Mr. Russell. No, I didn't.
Mr. Halley. Did you hear how Binaggio was killed after there were
rumors that he had talked before a grand jury ?
Mr. Russell. No, I didn't.
Mr. Halley. Did you ever hear of James M. Ragen ?
Mr. Russell, Sir ?
Mr. Halley. Did you ever hear of James M. Ragen, R-a-g-e-n ?
Mr. Russell. Yes.
Mr. Halley. Do you know Mr. Ragen ?
Mr. Russell. I decline to answer on the grounds that it may tend to
incriminate me,
Mr. Halley. Did you ever see James M. Ragen ?
Mr. Russell. I don't recall.
Mr. Halley. You know that Mr. Ragen headed the Continental
Wire Service at one time, is that right ?
Mr. Russell. I don't know what he did.
Mr. Halley. Did you ever hear it?
Mr. Russell. I don't recall.
Mr. Halley. Did you ever read in the papers that James M. Ragen
was killed ?
Mr. Russell. Yes.
Mr. Halley. Did you read in the papers that he was killed after
he made a statement to the police about his activities and the activities
of certain other people?
Mr. Russell. I don't recall. I didn't pay much attention to it at
the time.
Mr. Halley. When your lawyer, Luis Kutner, wrote this committee
that you would not appear to testify, and I quote, talking about you,
ORGANIZED CRIME' IN INTERSTATE COMMERCE G77
he stated tliat "Binaggio's case history iUustrates his point of view
and position."
Mr. KussELL. That is his point of view.
Mr. Halley. No; he is talking about you.
Mr. Russell. I can't help what he said about me. He is not my
lawyer.
Mr. Halley. Didn't you have in mind, when you were talking to
Kutner, that Binaggio and Ragen and Gargotta and others were killed
after they talked or were believed to have talked?
Mr. Russell. Positively not.
Mr. Halley. AVhen Ragen talked to the police in Chicago, he gave
the names of four people who he said were trying to "muscle in" on
Continental Press, and one of them was your partner, Tony Accardo.
Did you know that ?
Mr. Russell, I did not.
Mr. Halley. Did you ever hear it?
Mr. Russell. I did not.
Mr. Halley, Tony Accardo was your partner, wasn't he?
Mr. Russell. I decline to answer that question on the ground that
it may tend to incriminate me.
Mr. Halley. Were you ever on a boat called the Clara Jo?
Mr. Russell. I was.
Mr. Halley. That is a boat that was purchased by the S. & G,
Syndicate in Miami, is it not?
JNIr. Russell. That is one and the same boat.
Mr. Halley. It was purchased by the S. & G. after you entered the
S. & G. Syndicate, is that right, in 1949 ?
Mr. Russell. That is right. •
Mr. Halley. That boat was bought from Tony Accardo, wasn't it?
Mr. Russell. That boat was bought from the Rody Boat Co.
Mr. Halley. The checks, for your information, in payment for it,
were made out to Tony Accardo.
Mr, Russell. They may have been,
Mr. Halley. They are in evidence before this committee.
Now, do you still persist that that boat was not bought from Tony
Accardo?
Mr. Russell. I beg your pardon ?
Mr. Halley. Do you still persist that that boat was not bought from
Tony Accardo?
Mr. Russell. I never said the boat wasn't bought from him.
Mr. Halley, You said it was bought from some boat company.
What is the name of the boat company ?
Mr. Russell. I think it w\as the Rody Boat Co. in Fort Lauderdale,
Mr. Halley. The Rody Boat Co. ?
Mr. Russell. I believe so. I am not positive about that.
Mr. Halley, It was Tony Accardo's boat, wasn't it ?
Mr. Russell. I decline to answer that question on the grounds that
it may tend to incriminate me.
Mr. Halley. How could that possibly incriminate you, Mr. Russell ?
You are just obstructing this committee.
Mr. Russell. I don't care to obstruct the committee. I don't care
to be confused into saying something that may tend to incriminate
me, sir.
678 ORGANIZED CRIME' IN INTERSTATE OOMME'RCE
Mr. H ALLEY. You don't care to be led even close to saying some-
thing that would give the committee some facts, is that right ?
Mr. -Russell. I decline to answer that question.
Mr. Halley. You were a good friend of Tony Accardo's, weren't
you?
Mr. Russell. I decline to answer that question on the ground-
Mr. Halley. The evidence before this committee shows that you
handled the sale of that boat, that you had liad numerous telephone
conversations with Accardo within the last year
Mr. Russell. Let me ask one thing. Is it a crime to buy or sell a
boat 'i
Mr. Halley. I don't think so. Do you think it is ?
Mr. Russell. No, I don't think it is.
Mr. Halley. Now, will you tell the committee why you refuse to
answer the questions about it that were asked a few minutes ago?
Mr. Russell. I have reasons to believe that the answer may tend,
lead or tend to incriminate me, sir.
Mr. Halley. I think at this point I would like to ask the chairman
again to instruct this witness to answer all the questions up to this
point that he has refused to answer.
The Chairman. I do instruct you, Mr. Russell, to answer these
questions, because in the opinion of the Chair, you have no right to
refuse to answer them. So I instruct 3 ou to answer the questions. Do
you refuse to do so ?
Mr. Russell. I decline to answer the questions on the grounds
The Chairman. Any question counsel asks, just consider that the
Chair has instructed you to answer unless the Chair advises you to the
contrary, from now on, for the purpose of the record.
Mr. Halley. Thank you.
Do you know John Roselli ?
Mr. Russell. I don't recall.
Mr. Halley. Do you not know that John Roselli was convicted in
the movie extortion case that your former partner, Joye, was in-
volved in?
Mr. Russell. I don't recall.
Mr. Halley. Isn't it a fact that Louis Campagna, Paul Ricca, and
Charley Joye, John Roselli — that entire group operated with you as
a single unit at 400 South State Street?
Mr. Russell. I beg your pardon, sir?
Mr. Halley. Isn't it a fact that you met and associated with Louis
Campagna at 400 South State Street?
Mr. Russell. I refuse to answer that question.
Mr. Halley. He has testified that he did, and that he came there
and gave you large bets.
Mr. Russell. I refuse to answer that question on the grounds it may
tend to incriminate me.
Mr. Halley. Did you ever meet William H. Jdhnston ?
Mr. Russell. I decline to answer that question on the grounds it
may tend to incriminate me.
Mr. Halley. He has testified that he met you at 400 South State
Street.
Mr. Russell. There were a lot of people who met me at 400 South
State Street. Tliat was an important restaurant, and a lot of people
came there, and I don't recall who and what I met.
ORGANIZED CRIMD IX INTERSTATE COMMERCE 679'
]Mi'. Halley. Did William H. Johnston meet you there?
Mr. ErssELL. I decline to answer on the grounds that the answer
may tend to incriminate me.
]\Ir. Halley. Did John Roselli meet you there?
Mr. Russell. I decline to answer on the grounds that the answer
may tend to incriminate me.
Mr. Halley. Don't you know that John Roselli is the man who w^ent
to California and muscled into the wire service there?
Mr. Russell. I don't know.
]Mr. Halley. Are you sure you don't? Didn't you ever hear it?
Mr. Russell. I never heard of him.
]Mr. Halley. You never heard of John Roselli?
Mr. Russell. I may have. I don't recall. I don't want to be pinned
down to that.
Mr. Halley. Did you ever hear of Rocco DeStefano?
Mr. Russell. I don't recall.
■ Mr. Halley. You heard of this Local Retail Clerks Protective Asso-
ciation No. 1248?
Mr. Russell. I may have. I do not recall.
Mr. Halley. Did you ever read in the newspapers that the State's
attorney in Chicago charged that the same crowd of yours, Campagna,
Ricca, ')oye, DeStefano, and others, looted nine hundred-odd thousand
dollars from Local 1248 of the Retail Clerks Protective Association?
Did you ever hear that ?
Mr. Russell. I don't recall whether I did or not.
Mr. Halley. Don't you know — this may refresh your recollection —
don't you know that Local 1248 of the Retail Clerks Protective Asso-
ciation is also located at 400 South State Street, or was at that time
so located?
Mr. Russell. I wouldn't know who w-as up there, wdiether it was
Local 648 or 128 or any other 8.
Mr. Halley. Is there a possibility that that nine hundred-odd thou-
sand dollars moved downstairs from one office to another at 400 South
State Street?
Mr. Russell. I don't realize what you are talking about.
Mr. Halley. Let's see who all was there. You were there, weren't
you, at Russell's Silver Bar ?
Mr. Russell. To take $900,000? Are you asking that question?
]Mr. Halley. I am asking if yon were located at 400 South State
Street ?
Mr. Russell. I was located at 400 South State Street,
Mr. Haixey. And Ralph Pierce was located there?
Mr. Russell. I don't know wdiether he was or wasn't.
Mr. Halley. Local 1248 was located there?
jNIr. Russell. I don't recall.
Mr. Halley. Charles Joye testified that when he was in the book-
making business with you, he was located there. Did you know that ?
Mr. Russell. I don't recall.
Mr. Halley. At one point you went to Florida, is that right, in
your career ? When did you first go ?
Mr. Russell. I have been going to Florida on and off for 30 years.
Mr. Halley. Did you ever own a home there ?
Mr. Russell. That is right.
fiSil.'iS — 50 — pt. 1 44
680 ORGAIVIZED CRIME' IN INTERSTATE COMMERCE
Mr. Halley. I am sorry ?
Mr. Russell. That is right.
Mr. Halley. AVhere did you own a home in Florida ?
Mr. Russell. 4415 Post Avenue.
Mr. Halley. Do you own a home there now ?
Mr. Russell. I do not.
Mr. Halley. Didn't you recently buy a home on San Marino
Island ?
Mr. Russell. I didn't.
Mr. Halley. Did your wife? Why are you trying to evade and
avoid the questions?
Mr. Russell, What has my wife and family to do with this messy
situation ?
Mr. Halley. The mess is one of your creation and of your asso-
ciates'. Will you answer the question, Did your wife buy that?
Mr. Russell. I decline to bring her into this controversy at any
^iime.
Mr. Halley. This is not a controversy. The question is, Did your
wife recently buy a house in Miami Beach, Fla. ?
Mr. Russell. I decline to answer that question.
Mr. Halley. On what ground ?
Mr. Russell. On the ground it may tend to incriminate me.
Mr. Halley. You testified on Tuesday that you were living at a
liotel.
Mr. Russell. True.
Mr. Halley, What hotel ?
Mr. Russell. I am still living there, the Town House at Nineteenth
and Collins.
Mr. Halley. Where have you lived in the last 3 months, at what
hotels?
Mr. Russell. I decline to answer that question on the grounds
Ihat it may tend to incriminate me.
Mr. Halley. You have been at the Hampshire House in New York ^
Mr. Russell, I don't recall,
Mr. Halley, You don't recall that. Have you been at the Drake
in Chicago ?
Mr. Russell. I decline to answer that question. It may tend to
incriminate me.
Mr. Halley. Have you been at the Blackstone in Chicago?
Mr. Russell. Yes.
Mr. Halley. You have ?
Mr. Russell. Yes,
The Chairman. Answer out. We cannot hear you.
Mr, Russell. Yes. I have been at the Blackstone,
The Chairman. When Avere you at the Blackstone in Chicago?
Mr. Russell. I decline to answer that question. It may tend to
incriminate me.
Mr. Halley. In Florida a number of your former Chicago as-
sociates also lived, is that i-ight ?
Mr. Russell. I beg your pardon, sir?
Mr. Halley. Let us take them one at a time.
Tony Accardo has a home in Miami Beach, too, does he not?
Mr. Russell. I wouldn't know.
;
ORGANIZED CRIME IN INTERSTATE COMMERCE 681
Mr. Halley. Have you never been in the home of Tony Accardo
at Miami Beach ?
Mr. Russell. I decline to answer that question on the grounds
itliat it may tend to incriminate me.
Mr. Halley. Charles Fischetti has a home in Miami Beach, has he
not?
Mr. Russell. I decline to answer that question.
Mr. Halley. Have you ever been at the home of Charles Fischetti
at Miami Beach ?
Mr. Russell. I decline to answer that question on the grounds that
the answer may tend to incriminate me.
Mr. Halley. Were you ever in Al Capone's home in Miami Beach ?
Mr. Russell. I decline to answer that question on the grounds that
the answer may tend to incriminate me.
Mr. Halley. Did you know Al Capone?
Mr. Russell. No; I didn't know AI Capone.
^Tl•. Halley. Did you ever meet him?
Mr. Russell. No.
Mr. Halley. "Were you ever in the home of Al Polizzi at Miami
^Beach ?
Mr. Russell. I don't recall knowing Al Polizzi.
Mr. Halley. Were you ever in the home of Jack Guzik at Miami
Beach ?
Mr. Russei,l. I don't recall ever being in any of their homes.
Mr. Hai,ley. Do you know Jack Guzik ?
Mr. Russell. I decline to answer on the grounds that it may tend to
incriminate me.
Mr. Halley. Have you ever seen Jack Guzik ?
Mr. Russell. I decline to answer on the same grounds as previously
stated.
Mr. Halley. Were you ever in the home of Ralph Buglio at Miami
Beach?
Mr. Russell. I decline to answer on the grounds it may tend to
incriminate me.
Mr. Halley. You know very well that you know Tony Accardo
quite well. You know Charley Fischetti. You know Al Capone, or
knew him. You knew Al Polizzi. You know Jack Guzik. Aren't
those facts ?
Mr. Russell. That is what you said, sir.
Mr. Halley. Isn't that a fact?
Mr. Russell. I decline to answer on the grounds that the answer
may tend to incriminate me.
Mr. Halley. If you haven't the guts to deny it, I am going to as-
sun^e it is the fact.
How about Rocco DeStef ano. who is one of the people involved in
this local 1248 ? Do you know him ?
Mr. Russell. I don't recall knowing Rocco DeStefano.
Mr. Halley. Were you ever in his home in Miami Beach ?
Mr. Russell. I decline to answer that on the grounds that it would
tend to incriminate me.
Mr. Halley. Do you know Peter Tremont?
Mr. Russell. I do not recall.
Mr. Halley. Were you ever in his home at Miami Beach?
682 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Russell. I decline to answer that on the grounds it may tend to
incriminate me.
Mr, Halley. Do yon know Max Caldwell ?
Mr. Russell. I decline to answer that question on the ground it
may tend to incriminate me.
Mr. Halley. The stenographer will note the appearance of Senator
Tobey at this point.
Were you ever in the Robert Richter Hotel in Miami Beach?
JNlr. Iv'ussell. Yes.
Mr. Halley. Did you ever operate a bookmaking establishment
in the Robert Richter Hotel at Miami Beach?
Mr. Russell. I decline to answer that question on the grounds the
answer may tend to incriminate me.
Mr. Halley. Were you ever in the Hotel Wavette at Miami Beach ?
Mr. Russell. I may have been. I do not recall now.
Mr. Halley. Were you ever in the Hotel Bellaire at Miami Beach,
or at Surf -Side ?
Mr. Russell. I don't recall, sir.
Mr. Halley. You do not recall ?
Mr. Russell. I do not know where the Bellaire is, I may have been.
Mr. Halley. Do you know Jack Friedlander?
Mr. Russell. I decline to answer that question on the grounds it
may tend to incriminate me.
Mr. Halley. Do you know Nat IModell ?
Mr. Russell. I decline to answer that question on the same
grounds.
Mr. Halley. Do you know Al Anenberg ?
Mr. Russell. I decline to answer that question on the same
grounds.
Mr. Halley. Do you know Frank Erickson ?
Mr. Russell. I decline to answer that question on the same
grornids.
ISIr. Halley. Is it not a fact that you have done a large lay-olf bet-
ting business with Frank Erickson in New Jersey?
Mr. Russell. I decline to answer that question on the grounds the
answer may tend to incriminate me.
Mr. Halley. Is it not a fact that you have laid-off as much as $2,-
000,000 in bets with Frank Erickson in New Jersey ?
Mr. Russell. I decline to answer that question on the same grounds
as previously indicated.
Mr. Halley. With whom do you do lay-off betting in St. Louis ?
Mr. Russell. I decline to ansAver that question on the same grounds.
Senator Tobey. Why don't you have a little sign painted and hold
it u]) and save your voice?
JNIi'. Russell. I might just as well, sir. I don't think that I want
to incriminate myself. Senator.
Senator Tobey. Don't you want the country to have the truth, the
whole truth, and nothing but the truth, that you swore to give, no mat-
ter where it hits you or how it damns you ? Don't you think the coun-
try is entitled to know all your doings when you are challenged by
tlie courts and by the Senate of the United States? Why don't you
come clean and make a new start? Wliy not be a man for once in your.|
lifetime and-show that you have some guts and courage and say, ''Yes,
I have sinned, but I will do a right-about-face and tell you all you want
ORGANIZED CRIME) IN INTERSTATE COMMERCE 683
to know. I -will undo the whole dirty crowd for you and purify
America."
Wliy not have that in your soul instead of sitting there stating that
jou decline to answer? Why not make a good story instead of bring-
ing disrepute on everybody, and give the truth, the whole truth and
nothing but the truth ? You promised to do that and you are breaking
your oath right there. For heaven's sake, come right through.
Mr. Russell. Don't I have any rights?
Senator Tobey. You have the right before Almighty God to tell
the almighty truth and make a good American of yourself.
Mr. Russell. I am trying to tell the truth.
Senator Tobey. Do not hold back answers. No matter how hard it
hits, be a man and face it. The fellows over across in Korea are fac-
ing these tilings, and you sit back here a privileged character and are
afraid to tell the truth about yourself.
JNIr. Russell. I am not a privileged character, sir.
Senator Tobey. Then tell us the truth.
Mr. Russell. I am entitled to some rights.
Senator Tobey. You have the right before Almighty God to make
a decent disclosure and that transcends everything else.
Mr. Halley. Now, Mr. Russell, do you know William H. Johnston?
I have asked you that before but I am going to ask it again because he
figures very prominently in Florida as well as in Chicago. Do you
know him?
Mr. Russell. I decline to answer that question on the ground it may
tend to incriminate me.
Mr. Halley. Do you know a man named W. O. Crosby, sometimes
called "Bing" Crosby?
]\Ir. Russell. I decline to answer that question.
Mr. Halley. For your information, both of those people have testi-
fied under oath in open hearings before this committee that they know
JOU. Would you say that they were perjuring themselves ?
Mr. Russell. I decline to answer that question as previously stated.
Mr. Halley. When did you last talk to AVilliam H. Johnston?
Mr. Russell. I decline to answer that question.
Mr. Halley. Do you know a lawyer in Jacksonville named John
Hush ?
Mr. Russell. Yes.
Mr. Halley. When did you first meet John Rush ?
Mr. Russell. I don't recall.
Mr. Halley. Is it not a fact that you met him just about the time
that you went to the S. & G. Syndicate ?
Mr. Russell. I decline to answer that question on the ground it may
incriminate me.
Mr. Halley. Did not William H. Johnston introduce you to John
Rush?
Mr. Russell. I decline to answer that question on the ground that
it might tend to incriminate me.
Mr. Halley. What is that?
Mr. Russell. I don't recall.
Mr. Halley. Which is your answer?
Mr. Russell. I know Rush, and I don't recall who introduced me to
Jolm Rush.
684 ORGANIZED CRIME: in INTERSTATE COMMERCE
Mr. Halley. Didn't you cause the S. & G. Syndicate to pay Mr. Rush
a fee of $10,000?
Mr. Russell. I decline to answer that question on the ground it may
tend to incriminate me.
Mr. Halley. Do you know George Fowler ?
Mr. Russell. I decline to answer that question?
Mr. Halley, Is he not a man who lives in Florida?
Mr. Russell. I beg your pardon, sir.
Mr. Halley. He lives in Florida, doesn't he ?
Mr. Russell. I don't know. I wouldn't know. I don't know
whether he is in Florida or not. I don't know what you are talking
about, sir.
Mr. Halley. Did you ever hear of the Little Palms Club in Miami ?
Mr. Russell. Yes.
Mr. Halley. Were you ever in it ?
Mr. Russell. I don't recall whether I was or wasn't.
Mr. Halley. Don't you know that Fowler ran the Little Palms
Club in Miami ?
Mr. Russell. I decline to answer that question on the grounds the
answer may tend to incriminate me.
Mr. Halley. Were you in Miami Beach in the month of January
and the months of February and March of 1949?
]\Ir. Russell. I decline to answer that question on the ground that
the answer may tend to incriminate me.
Mr. Halley. Isn't it a fact that during those months you met and
talked with ^'Bing" Crosby, the investigator for the Governor of
Florida?
Mr. Russell. I decline to answer that question on the ground that
the answer may tend to incriminate me.
Mr. Halley. And isn't it a fact that you told Crosby locations
where the S. & G. Syndicate operated bookmakings so that he could
make arrests^
Mr. Russr.i.L, I decline to answer that question on the grounds as.
previously indicated.
Mr. Halley. If he so testified, would you say he was telling the
truth or not?
Mr. Russell. I decline to answer that question on the grounds as
previously indicated.
Mr. Haixey. Now, Ben Cohen, the attorney for the S. & G. Syndi-
cate, has testified, talking about your tipping off Crosby on the S. & G.
Syndicate. Ben Cohen said, "I don't believe a man in that business
would do that." And he also said, "I think that would be a pretty
low thing.'' I am quoting the record, references pages 633 and 634.
Would you say a man in your business would do such a thing as
tipping off "Bing" Crosby to where S. & G. was locating bookmaking?
Mr. Russell. I decline to answer that question on the grounds that
it might tend to incriminate me.
Mr. Halley. Do you think that the tipoff of an investigator for the
Governor of the State of Florida, as to where somebody else was
operating a gambling joint, would be a low thing?
Mr. Russell. I don't follow what you are trying to get at.
Mr. Halley. Well, Ben Cohen stated that. I am going after your
character and I am trying to find out wliat sort of character you have.
ORGANIZED CRIME IN INTERSTATE COMMERCE 685
Ben Cohen was a lawyer in Florida for the S. & G. Syndicate, and
he said that he thon^ht it would be a low thing for one bookmaker to
tip off an investigatoi- for the Government about another bookmaker.
Do you think it woukl be a low thing, or an honorable thing?
Mr. RiTssELL. I don't see where that question should be answered.
I decline to answer that question.
Ml-. Halley. Do j'ou know Hieme Levin, sometimes called Hime
Levine, or "Loud Mouth" ?
Mr. Russell. I don't recall whether I know him or not. I may
or I may not ; I don't know.
Mr. Halley. Did you ever see Levine ?
Mr. Russell. I don't recall.
Mr. Halley. Do you know where he is today ?
Mr. Russell. I beg your pardon.
Mr. Halley. Do you know where he is today ?
Mr. Russell. No, sir.
Mr. Halley. Did you ever hear of the Kenilworth Hotel in Miami
Beach?
Mr. Russell. Yes.
Mr. Halley. I think it is not exactly in Miami Beach. It is a little
bit north of Miami Beach, is it not?
Mr. Russell. Yes.
Mr. Halley. You have heard of it ?
Mr. Russell. Yes, sir.
Mr. Halley. Were you ever in it?
IVIr. Russell. Yes, sir.
Mr. Halley. Do you know the owner of it ?
Mr. Russell. I don't know, and I don't know who is the owner.
Mr. Halley. Did you ever discuss with anybody in the Kenilworth
Hotel the possibility of taking over the bookmaking operations for the
Kenilworth Hotel?
Mr. Russell. I decline to answer that question on the ground it
may tend to incriminate me.
Mr. Halley. Did you ever discuss or have any discussions with the
owner of the Kenilworth Hotel on any subject whatsoever?
Mr. Russell. I don't recall.
Mr. Halley. Did you ever have any discussion with the manager
of the Kenilworth Hotel on any subject matter whatsoever?
Mr. Russell. I don't recall.
Mr. Halley. Is it possible that you did ?
Mr. Russell. I don't recall..
Mr. Halley. You know the Kenilworth is supposed to be owned
by Chicago interests?
Mr. Russell. I didn't know.
Mr. Halley. You did not ?
Mr. Russell. No.
Mr. Halley. Did you know that the Sea-View Hotel is suDposed to
be owned by Chicago interests ?
Mr. Russell. I didn't know.
Mr. Halley. Did you ever talk to of did you know the owner of
the Sea-view?
Mr. Russell. That is a cooperative hotel and I don't think that
there is any OAvner.
686 ORGANIZED CRIME'. IN INTERSTATE OOMMERCE
Mr. Halley. Did you ever talk to the manager of the Sea- View
Hotel?
Mr. Russell. I don't know who the manager is.
Mr. Halley. You don't know him ?
Mr. Russell. I may know him but I don't ]-ight now know who the
manager is.
Mr. Halley. Would you say that whoever the manager is or was
in 1949, you never talked to the manager of the Sea-View Hotel ?
Mr. Russell. I decline to answer tliat question on the grounds it
may tend to incriminate me.
Air. Halley. During the year 1949, were you ever in the Sea-view
Hotel?
Mr. Russell. I don't recall.
]\fr. Halley. Were you ever arrested for book-making in Miami
Beach, Fla. ?
Mr. Russell. I have been indicted.
Mr. Halley. You were recently indicted with the S. & G. members ?
Mr. Russell. That is right.
Mr. Halley. And have you pleaded to that indictment ?
Mr. Russell. Just what do you mean by that, sir?
Mr. Halley. Have you gone into court and said whether you
wished to stand trial ?
Mr. Russell. I have not gone into court. I am under bond and I
have been indicted.
Mr. Halley. Did you ever meet Pat Perdue of the Miami Beach
police force?
]Vlr. Russell. Not that I recall.
Mr. Halley. Do you know who he is ?
Mr. Russell. I know of him.
Mr. Hali,ey. Have you ever seen him?
Mr. Russell, I don't know.
Mr. Halley. Did he ever close up your book at the Robert Richter
Hotel?
4
Mr. Russell. I decline to answer that question on the ground that
it may tend to incriminate me.
The Chairman. Mr. Russell, how did you get into the S. & G.
Syndicate?
Mr. Russell. I decline to answer that question, sir, on the ground
that it may tend to incriminate me.
The Chairman. I want the record to show that the Chair has in-
structed and ordered you to answer all of the questions that have
been asked you both by Senator Wiley, Senator Tobey, and by the
chairman and by counsel for the committee, Mr. Halley. Now, the
record will show that you have refused to answer certain questions
and that you have refused to obey the order of the Chair. Before
we proceed further in the matter, we want to give you one last
opportunity to answer the questions that have been asked you, tliat
is, the ones you refused to answer. Do you wish now to go back
and answer those questions or do you want to stand on your refusal
to answer?
Mr. Russell. Is tliat a question that you are putting to me?
The Chairman. That is a question.
Mr. Russell. My position is still the same.
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 687
Tlie Chairman. You still refuse to answer?
jNfr. Russell. Yes, sir.
The Chairman. I think in fairness we sliould tell yon that the
members here will reconnnend to the full committee contempt pro-
ceedings. You will remain inider subpena, Mr. Russell, and the
subpena will be continuing for further appearance before this com-
mittee. It is quite apparent that there is no necessity of going on
with the other questions in view of the fact that you refuse to give
the committee any information in answer to perfectly correct and
jjroper questions. At this point the committee will stand in recess
and you will remain under subpena subject to further orders.
Mr. Russell. Can I leave town, sir?
The Chairman. The advice of the Chair is that you do not leave
town and that you be available wdiere we can call you back.
Mr. Russell. When could that be, sir ? I came up here last Tuesday
with two suits of clothes.
The Chairman. You work out any matters of where you are going
to be with counsel of the committee, so that we can have you available
to call you back whenever we want.
Mr. Russell. I will come back ; yes, sir. I can work that out with,
the committee.
The Chairman. Counsel for the committee will confer with you
after we recess.
The committee will stand adjourned.
(Whereupon, the committee adjourned, subject to call of the
chairman.)
INYESTIGATTON OF OKGANIZED CRIME IN INTERSTATE
COMMERCE
tuesday, september 26, 1950
United States Senate,
Special Committee To Investigate
Organized Crime in Interstate Commerce,
Washington^ D. C.
The committee met, pursuant to call, at 2:45 p. m., in room 910,
Home Owners Loan Corporation Building, Senator Estes Kefauver
(chairman) presiding-.
Present: Senators Kefauver (chairman) and Hunt.
Also present: Harold G. Robinson, associate counsel, and Downey
Rice, assistant counsel.
The Chairman. The committee will come to order.
Mr. Volkart, do you solemnly swear the testimony you will give this
committee will be the w^iole truth and nothing but the truth, so help
you God ?
Mr. Volkart. I do.
The Chairman. All right, gentlemen.
TESTIMONY OF ERNEST VOLKART, JR., ASSISTANT CASHIER,
FIRST NATIONAL BANK, ABERDEEN, MD.
Mr. Rice. Will you state your name and address?
Mr. Volkart. Ernest Volkart, Aberdeen, Md.
Mr, Rice. You are employed in what capacity by the First National
Bank?
Mr. Volkart. Assistant cashier, First National Bank, Aberdeen.
Mr. Rice. You are appearing here in response to a subpena directed
to Mr. Rawhouser ?
Mr, Volkart. That is right, sir.
Mr. Rice. Do you have certain bank records that were asked for ?
Mr. Volkart. Yes, sir.
Mr. Rice. What are they ?
Mr. Volkart. They are the ledger sheets of Mrs. May H. Ford,
Mr. Tred Ford, the ledger sheets of Mr. Tredick Ford.
Mr. Rice. Before you leave those, will you tell us briefly what period
they cover and what they show ?
Mr. Volkart. Mrs. May H. Ford, the ledger sheets on her cover
from Mav 15, 1941, up through the last transaction, which is August
24, 1950. ^
Mr. Rice. What is the largest balance that she show^s?
Mr. Volkart. The largest balance that Mrs. Ford shows is $995.94,
May 20. 1944.
689
(590 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. EiCE. What is her present bahance?
Mr. VoLKART. The present balance is $323.58.
Mr. Rice. She is the wife of Tredick Ford ?
Mr. VoLKART. That is right.
Senator Hunt. What is the average monthly balance? Just guess
at it. You don't need to be accurate.
Mr. VoLKART. It is, roughly, $400.
Mr. Rice. On the account of Tredick Ford, will you briefly review
that in the same way ?
Mr. VoLKART. Mr. Ford's ledger sheets run from March 18, 1932, up
to the present time, the last transaction being September 11, 1950.
Mr. Rice. What is his highest balance?
Mr. VoLKART. His highest balance was $1,681.55, December 2, 1943.
Mr. Rice. And his present balance?
Mr. VoLKART. The present balance, $383.21,
Mr. Rice. Does he have any large deposits ?
Mr. VoLKART. The largest deposit is $808, back on December 2, 1943.
The Chairman. Is it mostly small deposits and small withdrawals?
Mr. VoLKART. Most of the withdrawals are small. There are very
few deposits over that span of time. Most of them are relatively
small, $100, $200, $300, the largest two being this $880 in December
1943 and $700 in October of 1949. Those are the two largest deposits.
Most of them are relatively small.
Mr. Rice. Do you have information about a mortgage held by Mr.
Mitchell on the farm of Tredick Ford ?
Mr. VoLKART. That mortgage was held by Mrs. Mitchell for quite a
number of years, $6,800. A jDayment of $2,000 was made on the mort-
gage on April 6, 1945.
Mr. Rice. By whom?
Mr. VoLKART. By Mr. Ford, of $2,000 in cash.
The Chairman. How do you know that ?
Mr. VoLKART. Our deposit tickets are made, where it says currency^
coin, and checks; the $2,000 is up where the currency is, Senator.
The Chairman. I see.
In other words, Mrs. Mitchell deposited $2,000?
Mr. VoLKART. It was deposited to her account, sir.
The Chairman. Does it show there by Mr. Ford ?
Mr. VoLKART. By Mr. Ford. It is marked on the deposit ticket^
Tredick Ford, payment on mortgage.
Mr. Rice. I think we will offer that as exhibit No. 170.
(Exhibit No. 170 returned to witness after analysis by the com-
mittee.)
The Chairman. How about these things here? Do you have photo-
stats of them These are your original records?
Mr. VoLKART. These are our original records, yes, sir.
The Chairman. They will be made exhibit No. 171, and we will
work out some arrangement to have copies or photostats put in the
record. You will keep all of these, will you ? They are permanent
records ?
(First National Bank, Aberdeen, Md., ledger sheets of May H. Ford
and Tredick Ford, exhibit No. I7l, were returned to witness after
analysis by committee.)
Mr. Voi.KART. They are permanent records.
ORGANIZED CRIME: in INTERSTATE COMMERCE 691
The Chairman. So the originals will be available if they are
needed ?
Mr. VoLKART. Yes, sir.
The Chairman. All right, Mr. Rice, you may work that out with
the witness.
Mr. KicE. Yes, sir. That w^as a $2,000 curtail in 1945 on the
mortgage ?
Mr. VoLKART. Yes, sir.
Mr. Rice. Was there further curtailment?
Mr. VoLKxVRT. On July 16, 1945, the balance was paid off on the
mortgage. $5,022, which included the $4,800 balance on the principal
plus the interest, which was paid $22 in cash and $5,000 apparently in
cashier's check drawni on a Florida bank.
Mr. Rice. Is it possible to tell from the bank records what Florida
bank ?
Mr. YoLKART. Mr. Rice, from our records I am afraid we coidd not.
We didn't have a Recordak machine at that time, which of course
would have made a picture of it. However, it may be possible to go
through our correspondent bank in Baltimore, the First National Bank
in Baltimore, and very likely they may have a photostat through their
Recordak machine.
Mr. Robeson. Would your Federal transit letters provide that
information?
Mr. VoLKART. No. The only information would be through the
means of a photostat.
The Chairman. Would you ask your correspondent bank, Mr.
Volkart, to see if they do have that and advise Mr. Rice or Mr.
Robinson ?
Mr. Rice. In any event, there is nothing in the account of Tredick
or May Ford which would account for that: mortgage curtail?
Mr. Volkart. Yes, sir.
The Chairman. What is the date of the deposit of the $5,000 check?
Mr. Volkart. July 16, 1945.
The Chairman. Do you have the date of the check ?
Mr. Volkart. No. This was the date that it was deposited in our
bank to Mrs. Mitchell's credit. It would, have to be some time prior
to Julv 16.
The Chairman. By Mr. Ford?
Mr. Rice. It was presented by Mr. Ford ; was it not?
Mr. Volkart. Yes, sir.
Mr. Rice. That liquidated the Ford-Mitchell mortgage; is that
correct ?
Mr. Volkart. That is right, sir.
The Chairman. Do you have any questions about that. Senator
Hunt?
Senator Hunt. Not at this time, but later on I want to know who
these people are, who they are related to, Avho this money came from
in Florida, those things that we are primarily interested in. You
are just now mak'ing your record.
]\ir. Rice. Yes. We will have witnesses in later to tie those in.
Do you have the bank transcripts of the accounts of Richard Neu and
his wife, Gladys Neu?
Ml-. Volkart. Yes, sir. Which one would you like first ?
Mr. Rick. We will review the account of Richard Neu.
692 ORGANIZED CRIMEi IN USTTERSTATE C^OMME'RCE
Mr. VoLKART. The ledger sheets I have here run back to September
13, 1945, and come up to the present date. September 21, 1950.
Mr. KiCE. What was the highest bahmce in the account at any
onetime?
Mr. VoLKART. September 16, 194G.
Mr. Rice. What was the amount ?
Mr. VoLKART. The amount was $4,008.59.
Mr. Rice. AVhat is the present balance?
Mr. VoLKAUT. The present balance, sir, is $56.19.
Mr. Rice. What would you say would be the average balance?
Mr. VoLKART. Roughly around $150 to $200.
Mr. Rice. Do you see any large deposits?
Mr. VoLKART. There are two, one $1,000 deposit in July of 1949 — -
July 9, 1949, and July 11, 1949, of $1,000 each.
Mr. Rice. Can you tell from the bank records whether those de-
posits were cash or check ?
Mr. VoLKART. From our records they were cash, sir.
Mr. Rice. Then you have the deposit tickets ?
Mr. VoLKART. Yes, sir.
Mr. Rice. They show that those two $1,000 deposits were cash?
Mr. VoLKART. That is right, sir.
Mr. Rice. Do you have other large deposits?
Mr. VoLKART. I have one of October 29, 1945, of $3,006.11, which
was made up of two checks.
Mr. Rice. What were those ?
Mr. VoLKART. One of them apparently was from Mr. Cronin in
Aberdeen
Mr. Rice. Is he a real-estate operator?
Mr, VoLKART. Yes, sir. The other apparently is from his wife for
$400. . ■ ■
Mr. Rice. Froi^i Mrs. Neu ?
Mr. VoLKART. Yes.
Mr. Rice. Do you have other substantial deposits?
Mr. VoLKART. There is another one of $1,200 on June 3. 1946, the
largest item thereon was a check drawn on Mr. Neu's savings bank in
Baltimore.
Mr. Rice. What is the name of that bank ?
Mr. VoLKART. The Baltimore Savings Bank, the Savings Bank of
Baltimore.
Mr. Rice. Mr. Neu has an account there ?
Mr. VoLKART. Yes, sir. There is another large one on September
9, 1946, $3,066.75, and again the largest item is a $3,000 check drawn
on the savings bank in Baltimore.
Again on February 2, 1948, there is a $1,720 deposit, the largest
item on it being a $1,600 check drawn on the Baltimore Savings Bank.
Those are the largest deposits in Mr. Neu's account.
Senator Hunt. What is Mr. Neu's occupation?
Mr. VoLKART. Right now he is bookkeeper for the Yiele Lumber Co.
in Aberdeen. Prior to that for a number of years he was booldieeper
for C. W. Baker & Sons, canned-goods brokers.
Senator Hunt. Do you have knowledge of wliat his monthly salary
might have been?
Ml'. VoEKART. No; I don't. Senator. It is paid in cash, and we
would have no way of checking that point, sir.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 693
Mr. Rice. Do you have a transci-ipt of the account of Mrs. Neu?
Mr. VoLKART. Yes, sir.
Mr. Rice. Will you review that?
The CiiAiRsiAN. Before you do, I notice here that apparently there
are two or three thousand-dollar withdrawals from Mr. Neirs ac-
count, October 30, 1945, and another one September 19, 1946. Do you
know what they were for ?
Mr. VoLKART. October 1945 and September 1946? Offhand, Sena-
tor, Mr. Neu, when he has some money, generally draws a check and
deposits it in his Baltimore bank. I think there may be a good chance
that those checks were deposits which he made in the savings bank.
The Chairman. Why would he be depositing money from the sav-
ings bank and witlidrawing from the savings bank?
Mr. Volkart. Let me check that. No ; that wouldn't stand up very
well. His deposit of the 9th was a check from the Baltimore Savings
Bank. 1 frankly can't tell you about the $3,000 check of September 9,
1946. ^ ^ '
Mr. Rice. The bank had no recordak during that period?
Mr. Volkart. No, sir. ^^^e don't recordak our own checks. We
only recordak the ones which we send through for clearance.
The CHAiRaiAN. Do you know whether those were cash withdrawals?
Mr. Volkart. AVe would have no way of telling that.
The Chairman. Or whether they were by check ?
Mr. Volkart. No, sir; I am sorry.
Tlie Chairman. All right, sir.
Mr. Rice. You are reviewing the Mrs. Neu account.
Mr. Volkart. Mrs. Neu's ledger sheets run from January 11, 1946,
up through the present date, the last transaction being September l'
1950. "^ ^ '
Mr. Rice. The high balance?
Mr. Volkart. The high balance in her account was October 28
1948, of $3,800.
Mr. Rice. The present balance is what?
Mr. Volkart. The present balance is $235.93.
Mr. Rice. Will you review now the major deposits?
Mr. Volkart. The major deposits in Mrs. Neu's account were Octo-
ber 28, 1948, $3,000 in cash : August 28, 1948, $3,000 in cash
The Chairman. What was the Hrst one?
Mr. Volkart. October 28, 1948, August 25, 1948, each of them
$3,000 in cash.
April 11, 1949, $2,000, which apparently is a life-insurance check,
from the Provident Mutual Life Insurance Co., Philadelphia $2,000
Then July 11, 1949, $515.50, another cash transaction.
The Chairman. The $3,000 ones were in cash ?
Mr. Volkart. Yes, sir; both of them.
Mr. Rice. I show you two checks and ask vou to describe them and
tell the committee what disposition was made of those in the bank.
Mr. Volkart. Have tlie members seen the checks, Mr. Rice^ You
mean describe the contents of the checks?
Mr. Rice. Describe them for the record.
Mr. Volkart. The first check is dated December 1, 1949, payaole
to the order of Gladys F. Neu in the amount of $5,000, signed Thomas
A. Rice, m payment for house, also on December 1, 1949, another ch(fck
694 ORGANIZED CRIMD IN INTERSTATE COMMERCE
payable to Gladys F. Neu, in the amount of $5,000, signed Thomas A.
Rice, final payment for house.
Mr. Rice. Do they bear endorsements?
Mr. VoLKART. The checks are endorsed, Gladys F. Neu, on each
one, and then counter endorsed by Richard A. Neu, and according to
the bank records of Mr. and Mrs. Neu, the checks were cashed for
Mr. Neu.
Mr. Rice. From the perforations can you tell anything about the
checks ?
Mr. VoLKART. The first check was paid on December 2, 1949, and
the other one was paid on December 7, 1949.
Senator Hunt. They were paid in cash?
Mr. VoLKART. Paid in cash. I
Senator Hunt. Were they deposited? I
Mr. VoLKART. There is no record on either account that there was '
a deposit of anywhere near that amount, sir. j
Senator Hunt. What bank are they written on? \
Mr. Voi.KART. Drawn on our ))ank in Aberdeen, the First National ^
Bank of Aberdeen, sir. '
Mr. Rice.' None of these parties about whom you have spoken have
a safe-deposit box or other account ? ]
Mr. VoLKART. There are no other accounts except these two. As to ^
the safe-deposit box I can't say yes or no, sir, because I didn't check 'i
that before I left. ,
Mr. Rice. I did. )
Mr. VoLKART. You did? I don't know without looking up the \
record on it. i
The Chairman. You asked down there, and they said they didn't ^
liave any ? j
Mr. Rice. Yes. • |
I believe that is all.
The Chairman. Senator Hunt had some things, but you were going i
to biing those out by somebody else. •
Mr. Rice. The relationship of these people can probably best be
brought out through another witness. Has your father appeared? '\
Mr. VoLKART. He hadn't come in when I did, sir. i
Senator Hunt. You are acquainted with these people personally? '
Mr. VoLKART. Yes, I am. '
The Chairman. Who is Mr. Volkart ? ''
Mr. Rice. He is the United States commissioner in Baltimore. He
happens to be this gentleman's father. '
Mr. Volkart. Yes, sir. '
Mr. Rice. He is in the bank and his father is practicing law, the j
-commissioner there. '
Mr. Robinson. Are you ready for Mr. Volkart, Senator? f|
The Chairman. Maybe Senator Hunt wants to ask some questions, j
Senator Hunt. I don't think I do at this time. As yet I haven't [|
.got even these transactions straightened out in my mind so that I can
ask intelligent questions. As we go along, I will get the story.
The Chairman. In order to get the thing straightened out a little
bit. if we can. these two checks were checks by a real-estate man
Mr. Rice. No.
Mr. Volkart. No.
i
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 695
11 •(
iThe Chairman. Mr/l -e was the i)uirlms(n-, aiul he gave checks to
5-s. Neu, two checks, each in the amount of $5,000, is that correct?
VTr. VoLKART. That is right, sir.
i he Chairman. They were present and paid off tliis cash?
^Jr. VoLKART. Yes, sir.
riie Chairman. That is the house that Mr. and Mrs. Neu lived in.
Iwas called the old residence, wasn't it ?
\li\ VoLKART. That is right. That is where they lived until they
lived into their new home.
The Chairman. Was that the total jnirchase price of the house «
^v. Rice. It was $10,500. They paid $500 down, and the check was
diwn on a different bank. I believe it was deposited in Mrs. Neu's
Kount.
The Chairman. As a banker, what would be your best judgment
iliut what salary Mr. Neu would get, knowing how well he lived, and
.( orth. Is it within the $5,000 range or $0,000 or $8,000?
Iv. VoLKART. Oh, it would be within the $5,000 range, I am quite
xtain, sir.
'he Chairman. He was a man who usually handled a lot of bio-
iiisactions in cash amounts? '^
Ir. VoLKART. For himself?
'he Chairman. Yes.
Fr. VoLKART. Since my personal knowledge of him, I would say
M to my knowledge. When he worked for C. W. Baker & Son, which
back a few years now, they were quite a big outfit, and it is very
' that m the years he worked for them he made substantiallV
than $5,000 through possibly presents or a bonus. Since 1933 I
!(i't think he has.
1ie Chairman. You think his salary would be less than $5,000?
Ir. Voi.kart. I am sure it Avould.
'lie Chairman. I take it they must have saved up a little money
1 had a savings account.
h VoLKART. Mr. Neu has had one in Baltimore for I don't know
c long.
'he Chairman. What is the general reputation of the Tredick
(d s economic status? Are they small farmers?
Ir. Volkart. That is what Mv. Ford has been practically all his
1 a farmer on a small scale. He doesn't have a large farm.'
he Chairman. You mean a truck farm ?
[r. Volkart. No: it is not a truck farm. Possibly his bio-^est
lime would be growing corn for a canning house, the F. 0. Mitchell
0. canning house, located right near Mr.' Ford.
he Chairman. In what sort of income bracket would you consider
Mo be? I know this is speculation and guess.
h: Volkart. Possibly in the last few years it has been better than
•er Jias before because I think the Government is helping the farm-
■:iloiig through the price set-up and I think in cash alone thev ^^et
i<e money. '^
he Chairman. Would you say he is in the three-, four- or five-
Kisand bracket?
^ r. Volkart. I would say it would be somewhere in that level sir
lie Chairman. I think that is all I Avant to ask you. '
e appreciate your cooperation very much, sir.
(iSnsS— 50— pt. 1 45
696 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
Mr. Robinson. Have you photostats of all of those?
Mr. Rice. No.
Mr. EoBiNSON. Do you want to arrange to photostat them and get,
them back to Mr. Volkart ?
Mr. Rice. If you will leave those with us.
(Discussion off the record.)
The Chairman. I appreciate your coming over, Mr. Volkart. I
hope we haven't inconvenienced you too much.
TESTIMONY OF ERNEST VOLKART, SR., ATTORNEY, ABERDEEN,
MD., AND BALTIMORE, MD.
Mr. Volkart (senior), do you solemnly swear the testimony j^ou will
give this committee will be the whole truth and nothing but the truth,
so help you God ?
Mr. Volkart (senior). I do.
Mr. Rice. Will you state your name and address for the record ?
Mr. Volkart. Ernest Volkart, Sr. Home address or office^
Mr. Rice. Either one.
Mr. Volkart. Aberdeen, Md. ; office, 407 Title Building, Baltimore.
Mr. Rice. You are an attorney at law and also the United States
Commissioner for JNIaryland ; is that correct ?
Mr. Volkart. That is correct.
Mr. Rice. Directing your attention back to 1945, do you recall a
transaction that you handled for Tredick and May Ford in connection
with a mortgage i
Mr. Volkart. In 1945? No; I don't. I have no file on it, because
whatever I did for them was possibly writing a deed. I don't remem-
ber offhand anything about a mortgage. I know he paid off one or
two mortgages. Does the record show a new mortgage put on at that
time ?
Mr. Rice. Yes. For a number of years you have counseled and
advised Tredick Ford ?
Mr. Volkart. Yes. I have known him for many years. If the
record shows that there is a $7,500 mortgage, with my name as
attorney
Mr. Rice. Yes.
Mr. Volkart. I would have prepared it. I have no independent
recollection.
Mr. Rice. I see. Do you recall anything about a mortgage on Tre-
dick Ford's farm held by Mary Mitchell ?
Mr. Volkart. Yes. She was the widow of F. O. Mitchell. I think,
and she had a mortgage. I don't really know the amount of that.
Mr. Rice. Did Tredick Ford consult you about liquidating or dis-
charging that mortgage?
Mr. Volkart. He said he was going to pay it off. Let me say this :
since you have mentioned it, it comes back to me. There was some
talk of transferring the farm to a daughter, a Mrs. Ethel Sullivan,
and instead of doing that I think the mortgage was made, given to
Ethel Sullivan, but I did not handle the funds to pay off the existing
mortgages. In fact, I didn't see any money.
Mr. Rice. Wliat was the reason for wanting to transfer the farm
to Ethel Sullivan?
ORGANIZED CRIME IN INTERSTATE COMMEECE 697
Mr. VoLKART. I would say it was primarily as security for the money
she was advancing.
Mr. Rice. Do you have any idea what money she was advancing ?-
Mr. VoLKART. No ; I have not.
Mr. Rice. How much ?
Mr. VOLKART. No.
Mr. Rice. What was the purpose of her advancing money?
Mr. VoLKART. I would say Mr. and Mrs. Tredick Ford are pretty
well up in years, and he had not been farming the place, but simply
renting the land out, and having a few chickens. Most likely the
interest payments were becoming burdensome for him.
Mr. Rice. So she more or less came to the rescue and helped him
out?
Mr. VoLKART. I wouldn't say "to the rescue," sir. I don't think that
Mrs. Mitchell was pressing them. I think it just was the situation of
a daughter trying to ease the burden of her parents.
Mr. Rice. As a result of- that, the Mitchell mortgage was paid off
and a new mortgage was placed on the property running to Ethel
and Jimmy Sullivan ; is that correct ?
Mr. VoLKART. I don't think that Mr. Sullivan's name was on the
mortgage. Did you see the land records? I haven't had the oppor-
tunity.
]\fr. Rice. Yes: I did.
Mr. VoEKART. Is his name on it?
INIr. Rice. Yes. T)o you have n copy of the mortgage?
Mr. VoLKART. No; I haven't. The mortgage is in Harford County,
and we use printed forms for that. I didn't have any recollection that
his name was on it. Of course, the record will speak for itself, the
land record.
Mr. Rice. Do you know the terms of that mortgage ?
Mr. VoLKART. No ; I have no independent recollection. I would
have to look at the land record again.
Mr. Rice. If I told you that the mortgage carried interest at 5
percent annually, would that sound right, with the amount of $7,500?
Mr. VoLKART. Yes; I would say that is possible.
Mr. Rice. I see.
The Chairman. You have the record there. Just read into the rec-
ord the date of the mortgage.
Mr. Volkart. You have the land record, Mr. Rice.
The Chairman. If you have a memorandum, a description of the
mortgage.
Mr. Rice. At liber GCB-291, folio 395. of the Harford County
Courthouse, there is a mortgage recorded which reflects the principal
amount of $7,500, the original of the mortgage being mailed to Ethel
Gertrude Sullivan, 2238 Southwest First Avenue, Miami. The
mortgage was dated October 25, 1945, from Tredick Ford and Ida May
Ford, his wife, to Ethel Gladys Sullivan and James Alexander Sulli-
van, her husband, in the amount of $7,500, bona fide indebtedness on
the Ferryman Farm ])roperty, payable in 10 years bearinc: interest at
5 percent payal^le annually. The mortgage required full insurance.
Witness to the signature of Tredick and May Ford was E. Pershing
Volkart. That is your son?
Mr. VoEKART. That is my son ; yes.
698 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Rice. Also recorded at the same place was an affidavit drawn
to certify that the consideration was actually paid
The Chairman. Let's have this affidavit printed in the record at
this point.
(The affidavit follows:)
State of Florida,
Dade County, ss:
I hereby certify that on this 2.jth day of October, in the year 1945, before .me,
the subscriber, a notary public of the State of Florida, in and for Dade County
aforesaid, duly commissioned and qualified, personally appeared Ethel Gertrude
Sullivan, one of the within-named mortgagees, and made oath in due form of law,
in the presence of Almighty God, that the consideration stated in the aforegoing
mortgage is true and bona fide as therein set forth.
As witness my hand and notarial seal.
W. H. Lee,
Notary Public, State of Florida at Large.
Received for record November 3, 1945, at 10 : 20 a. m. ; same day recorded and
examined per Granville C. Boyle, clerk.
Mr. VoLKART. Under the Maryland law, a mortgage is not valid
imless the mortgagee or one of the mortgagees makes an affidavit that
the consideration is true and bona fide.
Mr. Rice. You prepared that and saw that it was recorded ?
Mr. VoLKART. Possibly I recorded it. I may say this : In Harford
County, after a paper is delivered to the clerk for recording, a receipt
is issued. They want to know the address of either grantee or mort-
gagee and mail the mortgage out directly from the clerk's office.
Mr. Rice. Do you have any correspondence in connection with those
negotiations in your file, Mr. Volkart?
Mr. Volkart. No; I have not. My correspondence that I was able
to find starts in 1948, but primarily in September 1949=-September 8,
1949 — and there is a letter that I hnve addressed to Mrs. Ethel G.
Sullivnn on Monday, October 17, 1949; a letter addressed to Richard
Neu, Mr. and Mrs. Neu, September 9, 1950 ; and also a letter of Sep-
tember 18, 1949, to Mr. and Mrs. Neu advising that the deed from
Richard Neu and wife to Ethel Sullivan had been recorded with Fed-
eral and State stamp taxes of $11 each, also two deeds, one from Gladys
F. Neu and husband to Tredick Ford and wife, and the reconveyance
of the same property from Tredick Ford and wife to Richard A. Neu
and wife. The recording charges and my fee.
Mr. Rice. It seems to me that the other day when we were discussing
this transaction you had some correspondence with Sullivan and his
wife suggesting that a mortgage would be appropriate to cover the
situation under the circumstances.
Mr. Volkart. I don't know that it was a letter. I think after we
talked for awhile it came back to me thnt a mortgage suggestivon was
made by me rather than a deed. I felt at the time that ]\Ir. and Mrs.
Tredick Ford should not make an out-and-out conveyance and strip
themselves of the farm; that a mortgage would secure the daughter
in whatever amount she had advanced.
Mr. Rice. You have no correspondence covering that?
Mr. Volkart. I don't have any correspondence. I brought every-
thing that I seemed to liave. As I told you, I never opened the file.
I didn't examine the title. Thev brought deeds and said we would
like to transfer this. I never had occasion to o]>en a file as you would
for a case where vou have a title examination and title abstract or
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 699
a settlement adjusting taxes or house rent or anything of that kind.
Mr. Kick. From the way you explained that transaction to relieve
the Fords of a burden of paying the interest on the Mitchell mort-
gage, do we assume that the}' are not paying interest to the Sullivans?
Mr. VoLKART. I would be very much surprised if they did. It is
unusual to draw a mortgage without interest payments because some-
thing could happen to the Fords and the property would pass by
will or by operation of law and the Sullivans would certainly be
entitled to interest from that date on. I have never heard Mr. Ford
say that he had paid any interest.
"iNIr. Rice. AA'ill you go back a few years and tell the committee the
background of Richard Neu, his first wife, and the Bel Air Avenue
pro])erty, bringing it into possession of the Neu's?
Mr. VcLKART. The first Mrs. Neu — her maiden name was Arthur,
an old Harford County family, and Mr. Neu was bookkeeper for
C. W. Baker & Sons in Abercleen, which at one time was a large
canned-goods brokerage house. They had two sons, and the first
Mrs. Neu died, I think, somewhere around 1947 or 1948. At that
time Richard Neu, with his first wife, owned the property at 204
Bel Air Avenue in the town of Aberdeen that had been in their
joint names. I don't know who the deed was prepared by. I did not.
The property remained in that condition until 1944. At that time
Mr. Neu came to me and said that Mrs. Ethel G. Sullivan had advanced
money to them. They were at the- time building a new home on
Eogei's Street in the town of Aberdeen and that they wanted to
secure her. He didn't like to put a mortgage on it. He wanted a
deed to Mrs. Sullivan. I prepared the deed, and at the time he did
not tell me how much the money consideration was.
On September 9, 1949, 1 wrote to Mr. and Mrs. Richard A. Neu :
Herewith you will find deed to property at 204 Bel Air Avenue to Ethel G,
Sullivan, which must be signed by both of you in the presence of a notary.
When the deed is returned to me for recording, you must advise me of the
purchase price, as the stamp taxes are determined upon the amount of
consideration.
When the deed was brought to me by Mr. Neu on a Saturday morning,
duly executed, then he told me the consideration was $10,000. The
deed will show that I placed $11 Federal stamp taxes and $11 State
stamp taxes. At the same time I enclosed the deed for the property
on Rogers Street from Richard Neu and wife to Tredick Ford and
wife. The lot had been purchased by Gladys Neu, the wife of Richard
Neu, and title taken in her name. I don't know who handled the
transfer. I did not. They wanted to get it in joint names with the
right of survivorship. So, the transfer was made to the father and
mother of Mrs. Neu.
Mr. Rice. Tredick Ford and wife.
_ Mr. VoLKART. Yes. They simply were a conduit through which the
title passed.
The Chairmax. For which piece of property is that ?
Mr. VoLKART. That is the Rogers Street property.
At the same time
The Chairman. Do you mean they deeded it to the Fords and the
Fords deeded it back to' them ?
Mr. Volkart. Immediately. It was one transaction. We have
in Maryland the tenancy by the entireties, on the legal assumption
700 lORGATSriZED CRIMEi IN INTERSTATE COMMERCE
that husband and wife are not two people, but one person, and a wife
cannot create a tenancy by the entireties by a direct deed to the hus-
band. It must pass through a third party first. In the same letter I
wrote that I enclosed wills which I had prepared in line with their
discussion, the Neus, and returned the old wills. Also returning the
deed for the Bel Air property, the deed to the Rogers property, which
they had given to me for the purpose of preparing the other deeds. If
I had had the titles in my office, of course I would have had that infor-
mation, I said, "When the several deeds have been duly executed, if
3^ou will return them to me I will have the necessary transfers made
on the books of the county. I presume the 1949 taxes are paid as this
is requisite before a transfer can be made. All deeds will be mailed
to you from the clerk's office. The wills, of course, should be placed
in a safety-deposit box."
That was in September 1949, and having returned the deed to Mrs.
Ethel Sullivan, Mrs. Tredick Ford came to me some time in October
and told me to prepare a deed for the Bel Air property
Mr. Rice. You don't mean Mr. Tredick Ford?
Mr. VoLKART. No, Mrs. Tredick Ford came to me. The deed to
the Bel Air Avenue property to Ethel Sullivan had been recorded
on September 9, I think it was, 1949. In the early part of October,
Mrs. Tredick Ford came to my home one evening and said that her
daughter wanted to transfer the property to her. I told Mrs. Tredick
Ford that I wouldn't prepare a deed on the oral say-so of the grantee,
that I would want some writing from Mrs. Sullivan directing me to
do so. I got this letter, which has a printed line on top :
Mrs. Jimmy Sullivan, 26J »S'W. Thirtieth Road, Miami, Fla.
Mr. VoLKART : I would like to have the Neu property on Bel Air Avenue,
Aberdeen, transferred from Ethel Sullivan to Mrs. Mary Ford. Thank you.
Mrs. .J. A. Sullivan.
The CiiAiRMAisr. Let me get this straight. Is that what you call the
old residence on Bel Air Avenue?
Mr. Volkart;. Yes.
The Chairman. That says Neu property.
Mr. Volkart. The Neu was the name of the former owner, N-e-u.
Mr. Rice. That is the old Neu, N-e-u property.
Mr. VoLivART. As a result I wrote to her direct and said :
Df.ab Mrs. Sullivan : Your mother, Mrs. Ford, has delivered to me a letter
directing me to prepare a deed to transfer the property on Bel Air Avenue in
Aberdeen which yon recently acquired from your sister and brother-in-law, Mr.
and Mi's. Richard Neu, to her. I am enclosing a deed which must be acknowl-
edged by you and Mr. Sullivan before a notary public, w^ho must witness your
signatures as well as sign the acknowledgment and also give the date when his
commission e^'pires. If you will return it to me or to your mother, I will have it
recorded in Bel Air. I am also advised that you are expecting to sell the prop-
erty almost immediately and it occurs to me that you may hold this deed off the
I'ecord for a while to see if you can make a quick sale and then you and Mr.
Sullivan can transfer the property to the purchaser. However, if it is your
desire to place it in your mother's name, there is no reason why you can't do so, i
I have a copy of the deed that I prepared, but it never was returned
to me executed.
Mr. Robinson, Do you want that in the record?
The Chairman. It has been read into the record, has it not?
Mr. Rice. Yes, I read it.
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 701
The Chairman. One thing I didn't understand. How was it you
thought they were going to sell the property to someone else almost
immediately?
Mr. VoLKART. At the same time Richard Neu asked me to prepare
the deed transferring 204 Bel Air Avenue, Aberdeen, to Ethel Sulli-
van, I asked, "Is she moving up here or does she want to keep it for
rent?"
He said, "No, she will sell it as quick as she can."
I think the sale was made within a few weeks after that.
The Chairman. She did sell it, then, later on, the Neu property on
Bel Air?
Mr. VoLKART. Yes. Mrs. Sullivan. The deed must have gone on
lecord from Mr. and Mrs. Sullivan to the purchaser.
The Chairman. Who was the purchaser?
Mr. VoLKART. I don't know.
The Chairman. Do we have that?
Mr. Rice. Major Rice, a major at the Aberdeen Proving Grounds.
The Chairman. What did he pay for it?
Mr. Rice. He paid $10,500 in December of 1949, just a month or so
after that.
The Chairman. In cash? That is what those checks were for?
Mr. Rice. Yes.
Will you tell us about the retention of some interest in the property
on the part of the sons of Mr. Neu by his first marriage?
Mr. VoLKART. Mr. and Mrs. Neu obviously had an understanding
that the value of the property on Bel Air Avenue which primarily
came through the mother of his sons, that they should be protected,
and we had prepared a number of papers which were not satisfactory,
neither Mr. nor Mrs. Neu would give the boys a mortgage for that
amount, nor did they want to make a conveyance reserving a life
estate. Mrs. Neu, being considerably younger than Mr. Neu, felt
that she doesn't know what she may want to do in the future with the
property. We finally just recently had reached this ending to that.
I don't know whether it lias been signed or not, but I sent it to them.
The andersigned hereby acknowledge and certify that Willard H. Neu, at
present residing —
one in Pittsburgh and one in Oklahoma. I didn't have the exact
place. I left that vacant —
has an equity and/or interest in tlie amount of $5,000 in tlie land presently
situated on Rogers Street in Aberdeen in Harford County, Md., where the
undersigned now live, and said Willard H. Neu is to receive the sum of $.5,000
without interest in the event the above-mentioned property is sold during the
lifetime of either of the undersigned. If the property is not sold during our
respective lifetimes, we herein agree and covenant with Willard H. Neu jointly
and severally that we will make and execute a last will and testament in which
said Willard H. Neu is to receive a legacy in the amount of $.5,000. but this is
not to be a limitation of a larger legacy that may be bequeathed to him. In
witness whereof we have hereunto set oiir hnnds and seals this blank day of
blank, in the year one thousand nine hundred and tift.v —
and an acknowledgment has been prepared for Mr. and Mrs. Neu —
We acknowledge the foregoing are our respective acts—
and so forth.
I told them that it was nn unsatisfactory wav, but I did feel that
they were protected, certainly in case of death, because under the
I
702 ORGANIZED CRIME) IN INTERSTATE COMMERCE
Maryland law j'oii can't make an agreement to devise your property
or lease a legacy to someone. That was sent out lecently.
Mr. Rice. What evidence do the sons now have of the equity ?
Mr. VoLKART. If this paper is signed by Mr. and Mrs. Neu, each one:
that will be their evidence. 1 think they are in touch with Aberdeen
sales of property at the time wliere they live now, which are not madt
overnight. I think they would have to have ample notice of the salt
and would be able to come in and put in a claim for the $5,000.
The Chairman. Does that refer to the Rogers Street property?
Mr. VoLKART. That is the Rogers Street property.
The Chairman. Let me see if I understand. Mr. Neu by a formei
wife had these two sons.
Mr. VoLKART. Yes.
The Chairman. These two sons are claiming some kind of interesl
in the Rogers Street property ; is that right ?
Mr. VoLKART. They are not claiming it. It was an understanding
between Mr. and Mrs. Neu that his sons by the first marriage should
have what the home property was worth, which their mother reallj
acquired and paid for.
Mr. Rice. It was her property really.
The Chairman. The home property refers to Bel Air ?
Mr. VoLKART. 204 Bel Air Avenue.
The Chairman. The Bel Air property.
Mr. VoLKART. Yes.
The Chairman. So they propose to give this to them.
Mr. VoLKART, I don't know whether it has been executed or not
The Chairman. Anyway, they propose to give them this interest'
in the Rogers Street property in lieu of what interest they may havfi
had in the Bel Air Avenue property.
Mr. VoLKART. Yes. Absolutely they had no legal right to any
thing
The Chairman. But this is something they wanted.
Mr. VoLKART. This is something that Mr. and Mrs. Neu agreed on
to protect the boys as much as possible.
Mr. Rice. You said Mr. and Mrs. Neu. You mean Gladys Neu?
Mr. VoLKART. Gladys Neu and Richard Neu ; yes.
Mr. Rice. Suppose Richard Neu died tonight : wouldn't Mrs. Gladyi
Neu have the property in fee simple, with no recorded interest on the
part of the boys ?
Mr. VoLKART. No recorded interest. They wouldn't do that. That
is what I wanted to do. but they wouldn't do it.
The Chairman. All right.
Mr. Rice. During the negotiations for the sale and purchase of tEi
Rogers pi-operty and the Bel Air Avenue property, did either of thj
Sullivans appear in Maryland^
Mr. VoLKART. Mrs. Sullivan ?
Mr. Rice. Yes.
Mr. VoLKART. I don't think I ever laid eyes on her. I have heaw
that she w^as visiting, but I didn't see her, as far as I can recollect
Mr. Rice. I think that is all I have.
The Chairman. Mr. Volkart, we appreciate your cooj^eration. Yott
Avill of course keep your records in your j:)ermanent files?
Mr. Volkart. Oh, yes. May I say this : From the time that I got
this sunnnons, I didn't have much time to look because I didn't have w
ORGANIZED CRIME' IN INTERSTATE COMMERCE 703
file. The things are scattered. I would be very glad when I get back
to Baltimore tomorrow to look again, and if you are correct, I would
be glad to send you whatever correspondence there was in connection
with the $7,500 mortgage.
The Chairman. We would ai)preciate that very much and any
other information that sheds light on the matter.
Mr. Voi.KART. If there is any such thing, I will get the small files out
again. Shall I nuiil it to you right here?
Mr. Rice. Yes.
The Chairman. Thank you very much, Mr. Volkart. We are glad
to have had you.
TESTIMONY OF MAJ. THOMAS A. RICE AND MRS. RUTH M. RICE,
ABERDEEN, MD.
Do you solemnly swear the information you will give this committee
will be the truth, the whole truth and nothing but the truth, so help
you God?
Major Rice. I do.
Mrs. Rice. I do.
Mr. Rice. I think it would be agreeable if you both answer, if one
has the answer and the other one doesn't or vice versa.
The Chairman. For the record will you give your name and station
and address.
Major Rice. Maj. Thomas A. Rice, Aberdeen, Md.
Do you want my residence address, too?
Mr." Rice. Yes.
Major Rice. West Bel Air Avenue, Aberdeen, Md.
Mrs. Rice. Mrs. Ruth M. Rice.
Mr. Rice. What is your home town, Mrs. Rice?
Mrs. Rice. Aberdeen, Md.
Mr. Rice. Your home town, where j^ou were born and raised?
Mrs. Rice. Washington, D. C.
The Chairman. Where did you come from, ]\Iajor Rice?
Major Rice. Los Angeles, Calif.
The Chairman. The service brought a lot of people together.
Major Rice. Actually Ave were brought together before the service in
Washington.
Mr. Rice. Going back to 1949 will you tell the committee the cir-
cumstances surrounding the acquisition of the property on Bel Air
Avenue in Aberdeen ; how you came to buy the property ?
Major Rice. Yes. My wife and I arrived in Aberdeen and found
it almost impossible to rent a place. There were no quarters available
on the post, so we inquired from a number of real-estate dealers in
Aberdeen as to what might be available for sale. We found out from
Mr. Paul Cronin, an attorney and i-eal-estate broker in Aberdeen, that
a house was for sale at 204 West Bel Air Avenue. We thought at the
time that it was being sold by Mr. and Mrs. Neu, who had lived in the
house prior to the sale and who had just biult a new house in town,
and conducted, I suppose, the usual negotiations in connection with
acquiring real estate wherein a sale price was given us and an offer was
in turn made by us through the real-estate agent and was accepted.
Later, we found in the transfer of the title, or rather, actually in ac-
704 ORGANIZED CRIME IN INTERSTATE COMMERCE
complishing the sales contract or a contract for the sale, that the title
to the house and lot was in the name Sullivan, rather than Neu. Mrs.
Neu at that time explained that Mrs, Sullivan was her sister and that
she was acting for her in the sale. So the real-estate dealer assured
us that that made no difference, that the papers would just be slightly
delayed by the mail time from Aberdeen and return from Miami. So
a sales contract was drawn up approximately the middle of November,
and the sale was consummated on December 1, at which time payment
was made and the title was transferred and recorded.
Mr. Rice. What was the purchase price that you agreed on ?
Major Rice. $10,500.
Mr. Rice. Do you have a copy of the contract of purchase ?
Major Rice. Yes; I have. This is not a copy. This is the original
contract.
The Chairman. Do you want to read this into the record ?
Mr. Rice. I think so.
The Chairman. Do you have a copy ?
Mr. Rice. No ; we do not.
The Chairman. The main part is the signatures of Ethel G. Sulli-
van, James Sullivan, the sellers, and Thomas A. Rice, Ruth M. Rice,
apparently the grantees or buyers ; $10,500, Bel Air Avenue, dated the
9th day of November 1949.
(Photostats of agreement of sale and deed, covering 204 West Bel
Air Avenue, Aberdeen, Md., signed by Ethel G. Sullivan and James
Sullivan, were marked ''exhibit No. 172," and appear in the appendix
on p. 793.)
Mr. Rice. Just prior to the selling of the property, did you have any
instructions as to whom the checks should be drawn in :^avor of?
Major Rice. Yes.
Mr. Rice. Incidentally, with respect to the deposit, to whom was
the check drawn ?
The Chairman. That is the $500 check.
Major Rice. I don't recall.
The Chairman. Was it paid by check or cash?
Mrs. Rice. It was paid by check, but I don't have the check with me.
The Chairman. Mr. Rice has made an examination, and the check
was deposited to Mrs. Neu's account. But you do not know of your
own knowledge ?
Mrs. Rice. I have to check my own account.
The Chairman. Will you do that and advise us, that is, to whom
the check was made, and the date, and who endorsed it ?
Mrs. Rice. Yes.
Mr. Rice. Just prior to the settlement of the property on the 1st of
December, did you receive instructions as to whom the check should
be drawn in favor of?
Major Rice. Yes. Let us go back before the 1st of December. When
it became apparent through the sales contract that the prior title was
in the name of Sullivan, I asked Mr. Cronin if it would be proper for
me to pay Mrs. Neu for the house, in view of the fact that the actual
title rested with her sister and husband. Mr. Cronin said that I should
have some sort of a note instructing me to do so. Whereupon, Mrs.
Neu wrote to Miami and obtained from her sister, Mrs. Sullivan, a
hand-written note. It was returned to Mrs. Neu in a personal letter
ORGANIZED CRIME IX INTERSTATE COAIjVIERCE 705
and Mrs. Neu in turn handed it to me, wliich authorized me to pay her
for the house when the settlement was made. Then on the 1st of
December
The Chairman. Do you have the note?
Major Rice. No; that I cannot find and I have searched both at
home and in my safety-deposit box, and I apparently do not have the
note.
The Chairman. Was it signed by Mrs. Sullivan, or by Mr. and Mrs.
Sullivan ?
Major Rice. It was signed by Ethel G. Sullivan.
The Chairman. Was it signed by Jimmie Sullivan?
Major Rice. No; it was not.
The Chairman. All right.
Major Rice. But that note was what I took as authority for making
out the actual check in payment for the house to Mrs. Neu.
Now, you asked if I had any instructions on the 1st of December.
Mr. Rice. Yes.
Major Rice. In Mr. Cronin's office, when actual payment was being
made, I asked Mrs. Neu how she wanted the check made out and she
asked me if it would make any ditference to me if I were to make out
two checks for $5,000 each to her, which was what I did.
Mr. Rice. Are those the checks ?
Major Rice. Those are the checks.
Mr. Rice. Will you describe them ?
Major Rice. Describe them ?
Mr. Rice. Yes.
Major Rice. They are checks Nos. 4 and 5 on my account at the
First National Bank, at Aberdeen, Md., both dated December 1 ; check
No. 4, bearing the inscription "Payment for house" and check No. 5,
bearing the inscription "Final payment for house," each in the amount
of $5,000. Both were apparently paid, the first being paid on the 2d
of December and the second check being paid on the 7th of December,
according to the perforated cancellations.
(Photostats of three checks, signed by Thomas A. Rice, payable to
the order of Gladys F. Neu, in amounts of $5,000, $5,000, and $50,
respectively, were marked "exhibit No. 173," and appear in the ap-
pendix on p. 796.)
Mr. Rice. Was any reason given to you as to why two checks were
preferable to one?
Major Rice. No; she gave me no reason at the time. It seemed to
me at the time to be in the nature of a personal convenience for some
reason that was unknown to me, and did not appear to be of any
importance, since the total amount was the amount due and the
amount agreed upon for the house.
Mr. Rice. Now, at the same time, did you receive a deed?
Major Rice. Yes, I did. At the same time I saw a deed which, of
course, the attorney took and had recorded and I got it in a matter of
a feAv days later.
The CnAiR:\iAN. This deed is dated the 1st day of December 1949,
signed by Ethel G. Sullivan and James Sullivan and refers to the Bel
Air Avenue property; attestation of Gladys F. Neu. Notarized in
the State of Florida, city of INIiami, before Betty Jane Oswald, notary
public. 20th day of November 1949. It has tax stamps on it; it seems
706 ORGANIZED CRIME IN INTERSTATE COMMERCE
to be recorded December 2, 2 : 46 p, m., 1949 ; and it records Harford
County, Md.
Mr, Rice. During the transaction by which you acquired the prop-
erty, did you ever have any dealings with either one of the Sullivans ?
Major Rice, I didn't even meet either one of them. I never saw
them. [To Mrs, Rice,] Did you ?
Mrs. Rice. No.
Mr. Rice. As far as you know, they have not been in Aberdeen or
Maryland during that time?
• Major Rice. During these transactions, no; as far as we know.
The Chairman. Are there any questions. Senator Hunt?
Senator Hunt. Did you receive an abstract of title to the property
wiien you purchased it, or do you just have the deed certifying that
the abstract is clear and the property has no encumbrance?
Major Rice. I have a note from the attorney in iVberdeen. I believe
I have it with me. In Harford County, it seems to be the standard
procedure for determining whether a piece of real estate is clear, that
is, just to have one of the local attorneys clear it. That reads :
Dear Major and Mrs. Rice : Please be advised that I have examined title of
premises known as 204 West Bel Aii- Avenue and find that fee simple title is in
Ethel G. Sullivan. This property is free and clear of all encumbrances and deed
delivered to you this date transferring said property to you conveys a clear title.
It is signed by N. Paul Cronin, attorney at law.
Senator Hunt. He is just an attorney. Is he considered an officer
of the court ?
Major Rice. He happens also to be a magistrate.
Mr. Rice. That is dated December 1, 1949?
Senator Hunt. You do not have, then, a clear certificate of title
excepting this letter ?
Major Rice. Excepting that letter and the actual deed. That is
correct.
Senator Hunt. And yet if you wanted to dispose of this property
and found from your own investigation that the title was not clear,
then, of course, you would be in a little difficult situation, would 3'ou
not?
Excuse me, just a minute. Is this the accepted usual method of
handling property transactions back here?
Mr. Rice. As far as I know — not in Washington. You have the in-
sured title and the certificate of title from a title company. But in
Maryland, apparently, the lawyers certify it.
Major Rice. Although this is the first time I have ever owned a
piece of property, I inquired at the time if it would be necessary to
clear the title with a guaranty title trust company of some sort and
was advised by any number of old-time residents of Aberdeen that
this is routine in Harford County, and apparently throughout Mary-
land.
Senator Hunt. What I am getting at is this : I would like to see
how and when and where and for what the Sullivans received title
to the property. That is what I was wondering about.
Major Rice. That is covered briefly. You say when and where. At
least those two questions are answered in this sales contract, which
reads in part :
Being the same and all 1h(^ land as described in a deed from Richard A. Neu
and wife to Ethel G. Snllivan, and dated September 10, 1940, and recorded among
tlie land records for Uarloid Cuuuty iu Jbieber No. 334, folio 326.
ORGANIZED CRIME IN INTERSTATE COMMERCE 707
Mr. Rice. That was in September of 1949 and ^Ir. Volkart testified
that the consideration was $10,000, accordino; to what Mr. Neu told
him, and he put the necessary stamps on it and recorded it.
Senator Hunt. During your negotiations in buying the property,
did Mr. or Mrs. Neu speak of the Sullivans to any extent? Did they
suggest how the Sullivans happened to be involved in tlie property?
Major Rice, Mrs. Neu told us that the title actually rested with her
sister, when it came time to sign an agreement, and that had to be
signed by her sister and her husband.
Senator Hunt. Did they indicate to you who the Sullivans were?
Major Rice. Other than the fact that Mrs. Sullivan was her sister,
they did not indicate to me.
Did they to you [to Mrs. Rice] ?
Mrs. Rice. No; simply that they were the Sullvans in ISliami.
INIajor Rice. Yes: that they were in Miami, and that Mrs. Sullivan
was INIrs. Neu's sister. That is all.
Senator Hi^nt. I have no more questions.
Mr. Rice. I think that is all.
Senator Hunt. Thank you very kindly. Major and Mrs. Rice. It
was kind of you to come up and help us with your testimony.
INIajoi" Rite. Thank you, Senator.
TESTIMONY OF RICHARD A. NEU, ABERDEEN, MD., ACCOMPANIED
BY JOHN L. LASKEY, ATTORNEY
Senator Huxt. Mr. Neu, would you please stand and be sworn ?
You do solemnly swear that the testimony you are about to give is
the truth, the whole truth, and nothing but the truth, so help you God?
Mr. Neu. Yes, sir.
Mr. Rice. I understand, Mr. Laskey, that you would like to make
an explanation with respect to Tredick Ford.
Mr. Laskey. Yes, I would.
I was retained in this matter last night by telephone, and retained
in the matter both by Mr. and ]\Irs. Neu and Mr. Ford.
I had a telephone conversation this morning at my house at approxi-
mately 8 : 15 from a Dr. Rodman of Aberdeen, INId. Dr. Rodman said
that he had been asked to say whether or not Mr. Ford could properly
appear in response to the subpena which was served on him last night.
Dr. Rodman asked if the request emanated from me and I said it
did not. He further said that he was not in a position to say whether
Mr. Ford could or could not appear, but he also said that Mr. Ford
had been under his professional care for a matter, I believe he said,
of '2 years. He was a man 76 years of age and was extremely nervous,
and that the most he would request was to have an opportunity to de-
termine wliether or not he could appear. He thought that he could, but
he also thought that the suddenness of the subpena and the urgency
of the appearance today requiring him to leave Aberdeen at 8 might
ha\ e a detrimental effect, and he would like to have an opportunity to
further examine his patient before he said one way or another.
I indicated that 1 would communicate and join in that request.
Neither Dr. Rodman nor I are in a position to say that lie is unable
to appear, and we expect that he would be, but we did not want him
[to take the risk of appearing today.
708 ORGAK-IZED CRIMEl IN INTERSTATE COMMERCE
r The Chairman. We will see further about it and get in touch with
you.
Mr. Rice. Will you state for the record, sir, your name and address ?
Mr. Neu. Richard A. Neu, N-e-u, Aberdeen, Md.
Mr. Rice. Where are you employed?
Mr. Neu. Viele & Co., lumber dealers.
Mr. Rice. You are appearing here in response to a subpena?
Mr. Neu. Yes, sir.
Mr. Rice. Did you bring any papers with you ?
Mr. Laskey. May I say with respect to the subpena that it called
for so many documents, and was so sweeping in character, that we felt
that we were unable to comply with it fully, or rather, Mr. Neu felt
that he was not. We are perfectly willing to produce any document
that might be relevant to any matter which the committee has under
investigation. But this calling for papers from 19J:4 to date, we take
the position that it is far too sweeping to enable us to comply with
it at this time.
The Chairman. I think the subpena states about as definitely as it
is possible to state the nature of the papers we want. We can proba-
bly give you a better idea as we go along with respect to what we want,
and you will be willing to produce those ?
Mr. Laskey. Yes. We would like to inquire generally the nature
of the investigation. We understand that this committee, as other
Congressional committees, has very sweeping powers, and we are
anxious to cooperate with the committee. But we do think there is
some limitation on the part of the connnittee, as I understand the deci-
sions, and while witnesses have a very tremendous hazard in determin-
ing whether or not to answer committee questions, they do have a
right to form an intelligent opinion as to whether they are required
to answer. To do that, I think it only fair that we know to some
extent what the committee would like to inquire into.
The Chairman. If you and Mr. Neu are willing to cooperate with
us, we will get along all right.
Mr. Laskey. I am sure we will. Senator.
The Chairman. What we want to inquire into, I might say, is this :
What were the financial transactions between Mr. and Mrs. James
Sullivan and Mrs. and Mr. Neu, and how did they come to be?
Mr. Neu. The transactions were mostly between Mrs. Sullivan and
my wife, Mrs. Neu.
The Chairman. Suppose you go along and tell us what you know
about it, and Mr. Rice will ask any further questions he deems
necessary.
Mr. Laskey. Might I ask leave to advise the witness that he should
restrict himself to what he has personal knowledge of ?
The Chairman. Yes ; that is right.
Mr. Neu. You mean you want to know about the house ?
The Chairman. That is right. I think the record shows that you
and Mrs. Neu had this house on Bel Air Avenue?
Mr. Neu. Yes, sir.
The Chairman. I am just going over this, and you tell us in detail
about the matter. You and your wife deeded this house to Mrs. Sulli-
van. Then vou built a house on Robers Street, for which you paid on
a cash-plus 'basis probably about $19,000 or $20,000. We want to
know what the whole transaction was, Mr. Neu.
ORGANIZED CRIMEl IN INTERSTATE COMMERCE 709
Mr. Neu. Well, the approximate value was about $15,000 plus the
price of the lot, which was $2,500, as near as I can recall. We deeded
the house to Mrs. Sullivan and she later sold it to Major Rice and his
wife for $10,500, of which $500 belonged to the brokers in the transac-
tion. In other words, $10,000 net, which we applied on the new house.
In other words, when we deeded the house over to her we estimated
the value to be that much.
The Chaikmax. Then she sent you $10,000, or your wife?
JNIr. Neu. No. Major Rice paid the $10,000.
The Chairman. Then what was the purpose of deeding the house
to Mrs. Sullivan ?
Mr. Neu. Well, to reimburse her for part of the money she advanced
to build the house. That transaction was, as I say, between Mrs. Sul-
livan and ]Mrs. Neu. She could tell you better about that than I
could.
The Chairman. You mean Mrs. Sullivan advanced some money, as
to which your wife can state more exactly, with respect to building
the house on Rogers Street?
i\Ir. Neu. That is right.
The Chairman. So vou gave Mrs. Sullivan a deed to the house on
Bel Air Avenue for $10,000?
Mr. Neu. That is right.
The Chairman. Which she sold to the Rices for $10,000?
Mr. Neu. Yes; $10,500, of which $500 went to the brokers in it.
The Chairman. Now, you are all getting $10,000 from Mrs. Sul-
livan ?
Mr. Neu. Well, Mrs. Neu will have to answer that. I did not enter
into that at all.
The Chairman. How much do you make, Mr. Neu ?
Mr. Neu. Now ?
The Chairman. Yes.
Mr. Neu. $50 a week.
The Chairman. Has that been your salary for some time?
Mr. Neu. No; I did not get quite that much. I was just advanced
about 2 months ago. It was $47.50 then. Now it is $50.
The Chairman. You did not have any $10,000 to be putting into a
house, then, did you?
Mr. Neu. No, indeed ; no, sir.
The Chairman. Do you know what the total amount you got from
Mrs. Sullivan was, that is, you and your wife?
Mr. Neu. No, sir; I could not answer that.
The Chairman. Was it in excess of $10,000?
Mr. Neu. I could not answer that. She gave her a little all along,
a couple of thousand one time, a couple of thousand maybe another
time, and so on, until the house was completed.
The Chairman. Mr. Rice, excuse me. I know you know better what
to ask than I. I apologize. You go ahead.
Mr. Rice. Back in August of 1948 the Rogers Street lot was bought ;
is that correct ?
Mr. Neu. What is the date of that?
Mr. Rice. In August of 1948.
Mr. Neu. That is correct.
Mr. Rice. And the purchase price of the lot was how much?
710 ORGANIZED CRIMEl IN INTERSTATE COMAIERCE
Mr Neu. $2 500. Either $2,000 or $2,500. I am not sure which.
Mrs. JNeii would know tliat better than I.
Mr. Rice. Tliat was bought from Blackburn «
Mr. Netj. That is right.
Mr. Rice. What was the source of the money for the purchase of
that lot ? ■
Mr. Neu. My wife had that money. She had that money.
Mr. Rice. In a separate account?
Mr. Neu. Well, she had it in the bank, in the Aberdeen Bank which
she Jiad previously gotten, I think, from Mrs. Sullivan.
Mr Rice. So the money that was used to acquire the lot was orifrin-
ally obtained from Mrs. Sullivan ? *
Mr. Neu. I would say so.
Mr. Rice. Do you know how long before the lot was bought «
Mr. Neu. No ; I could not tell you that. "^
Mr. Rice. Days or a week ?
Mr. Neu. Mrs. Neu could probably tell you that.
Mr. Rice. Do you know whether that was in cash or by check?
Mr. Neu. I couldn't answer that.
Mr. Rice. Did Mrs. Sullivan bring it up or send it up?
Mr. Neu. She came to Aberdeen on several occasions and o-ave
Cxladys some money, but, as I say, you will have to ask Mrs. Neu about
that.
Mr. Rice. Was any reason given for advancing money to her, or
giving money to her sister ? ^5
Mr. Neu 'Only to pay on the house. We had to pay the contractor
every month.
Mr. Rice. B"t /licl she give any reason why she wanted to build a
house for you and Mrs. Neu ?
Mr. Neu. Not especially, no.
^1 ^^'-.P/.^^- ^I^f' J^^^"' ^^lio was the contractor in connection with
the building of the house?
Mr. Neu. ]\Ir. Gwynn.
Mr. Rice. Mr. William Gwynn?
Mr. Neu. William R. S. Gwynn.
Mr. Rice. Of Havre de Grace?
Mr. Neu. Yes.
Mr. Rice. AVhat were the arrangements as to the contract « Was it
an estimate or a cost-plus?
Mr. Neu. We wanted it built on a percentage basis, cost plus In
other words, being connected with Viele Lumber Co., I got the lumber
at a wholesale price, Avhich made the house a little cheaper than it
otherwise would have been. So it was on a 10 percent basis.
Mr. Rice. So he had a 10-percent override over the actual cost of
labor and materials?
Mr. Neu. That is right.
Mr Rice. Did he give you an estimate in advance on the basis of
the plans you gave him, as to what the ultimate over-all cost would be ?
Mr. Neu. Well, I think he said around $16,000 or $17,000. I am not
sure which. It was around that. am not
Mr. Rice. And during wliat period was the house built?
Mr. Neu It was started in the earlv part of Or-toh^r 194.S and
finished ill April 1949. We moved in on'the 25th of April
ORGANIZED CRIME IX INTERSTATE COMMERCE 711
Mr. EicE. Xow, then, in the meant inie you had been livin<;' on Bel
Air Avenue?
Mr. Neu. That is right.
Mr. Rice. And you put a tenant in the Bel Air Avenue house after
you moved out ?
Mr. Neu. Yes.
IVlr. Rice. Did the total cost on the Rogers Street house closely
approximate the estimate, or did it run more?
Mr. Neu. Well, it ran nearly about what he said it was going to cost.
Mr. Rice. That was about $18,000?
Mr. Neu. Around $17,000 or $18,000.
Mr. Rice. Did that include a garage?
Mr. Neu. No. I had that built later and paid for it myself.
Mr. Rice. How much did that cost?
Mr. Neu. $656.
]\Ir. Rice. Now, what were the arrangements with Mr. Gwynn as
to monthly statements, or weekly statements ? How did you pay him ?
Did he present a statement to you once a month?
Mr. Neu. I have his bills with me.
Mr. Rice. How often ?
Mr. Neu. Once a month ; the end of each month.
Mr. Rice. You would review those and pay those?
]\Tr. Neu. That is right. I have receipts for all of those.
Mr. Rice. You had no construction loan?
Mr. Neu. No, sir.
Mr. Rice. And no mortgages or encumbrances on the lot or prop-
erty ?
Mr. Neu. Not a penny.
Mr. Rice. And it is free and clear now?
Mr. Neu. Absolutely.
Mr. Rice. When these statements were presented, how did you pay
them — by check or cash ?
Mr. Neu. Mostly f-ash.
Mr. Rice. Where did tlie cash come from?
Mr. Neu. That came from the money that Mrs. Sullivan had given
Mrs. Neu.
Mr. Rice. Where did you keep that money?
Mr. Neu. Well. I think we kept it in the house, because we paid out
every so often. We just kept it in the house.
Mr. Rice. Do you have any idea just how much money that was?
Mr. Neu. No, I wouldn't like to make a guess on that. Probably
three or four thousand dollars ; then later on we got a little more, and
so on, until the house was paid for.
Senator Hunt. Will you ask the witness how that money was trans-
mitted to ISIrs. Neu by Mrs. Sullivan; through the mails, or how did
she get it?
Mr. Neu. She came to Aberdeen frequently, and occasionally it wa*
mailed to us.
Mr. Rice. Cash?
Mr. Neu. Yes, sir.
Mr. Rice. She mailed cash through the mail?
Mr. Neu. Yes.
68958—50 — pt. 1 46
'712 ORGANIZED CRIMEl IN INTERSTATE COMMERCE
Mr. Rice. That went directly to the Bel Air Avenue house where
you are living?
Mr. Neu. That is right.
Senator Hunt. May I ask you, Mr. Neu: Why was that unusual
method taken of sending the money?
Mr. Neu. You will have to ask my wife about that because I did
not get into that end of it at all. The only point I was interested in
was the house on Bel Air Avenue, which was turned over to Mrs. Sulli-
van as part payment of the new house. That is as far as my interest
went.
Mr. Rice. But during the time that you were building the Rogers
.Street place, did Mrs. Sullivan come to Aberdeen?
Mr. Neu. Yes, indeed.
Mr. Rice. How many times?
Mr. Neu. Oh, I would say three or four times.
Mr. Rice. Then it was completed in April?
Mr. Neu. April 1949.
Mr. Rice. And in September, the Bel Air Avenue house was deeded
to Ethel Sullivan?
Mr. Neu. I guess that is about the right month. I haven't that in
my mind, but I think that is about right.
Mr. Rice. And it was then sold to Major Rice and his wife?
Mr. Neu. In October, wasn't it ?
Mr. Rice. In December, I believe.
Mr. Neu. Shortly after that.
The Chairman. November or early December, .
Mr. Neu. That is right.
Mr. Rice. Do you recall the arrangements made at settlement, by
-which the Rices paid the Sullivans or the Neus?
Mr. Neu. It is my impression that Mrs. Sullivan wrote Mrs. Neu a
note, or to Major Rice, to let the checks come to Mrs. Neu.
Mr. Rice. Why was that?
Mr. Neu. And they were made out to Mrs. Neu.
Mr. Rice. Why was that?
Mr. Neu. I wouldn't know. That is another question Mrs. Neu will
ihave to answer.
Mr. Rice. As far as you know, was there any plan to reimburse Mrs.
Sullivan for the money she advanced in connection with the construc-
tion of the Bel Air Avenue house?
Mr. Neu. Only through the sale of the Bel Air Avenue house.
Mr. Rice. Wlien the Bel Air Avenue house was sold, did the money
go back to Mrs. Sullivan?
Mr. Neu, Yes.
Mr. Rice. How did that go back ?
Mr. Neu. That went back, as far as I recall, as cash.
Mr. Ru-e. Well, why would that be prefeiTed over having checks
drawn to Mrs. Sullivan ?
Mr. Neu. Well, I don't know. I haven't any reason to state why,
but that is ]:)robably the Avay she wanted it.
Mr. Rice. Who 'is "she"?
Mr. Neu. Mrs. Sullivan, and we just cashed the checks that Major
^ice gave us.
Ml'. Rice. At the bank?
Mrs. :Neu. Tes.
ORGAmZED CRIMEi IN INTERSTATE COMMERCE 713
Mr. Rice. And sent the money? Did you send the money yourself?
Mr. Neu. Mrs. Neu handled that.
The Chairman. Sent $10,000 through the mail?
Mr. Neu. I don't know whether she sent it through the mail or
whether Mrs. Sullivan came up later and got it. She will have to tell
you about that.
The Chairman. Both you and Mrs. Neu had bank accounts, did you
not?
Mr. Neu, At the Aberdeen Bank ; yes, sir.
The Chairman. At that time ?
Mr. Neu. Yes, sir.
Mr. Rice. The money was not deposited in a bank, was it?
Mr. Neu. That cash money ? No, sir.
Mr. Rice. Where was that $10,000 kept during the period prior to
its being delivered to Mrs. Sullivan?
Mr. Neu. I kept it in the safety-deposit box in Aberdeen Bank.
Mr. Rice. Diet you have a safety deposit in the Aberdeen Bank?
Mr. Neu. Yes, sir.
The Chairman. Do you have it now ?
Mr. Neu. Yes ; have had for years.
The Chairman. How long did you keep it there before you sent it
to Mrs. Sullivan ?
Mr. Neu. The money ?
The Chairman. Yes.
Mr. Neu. I really would not know. I couldn't answer that question.
The Chairman. I mean, a month ? Two months ?
Mr. Neu. I turned it over to Mrs. Neu and she took care of it from
then on.
Senator Hunt. Does Mrs. Neu also have a safety-deposit box ?
Mr. Neu. No, sir.
The Chairman. How long did you keep it before you turned it over
to her?
Mr. Neu. Possibly I would say about a month or so.
Senator Hunt. You would send that money back down to Florida,
then. Did you register it?
Mr. Neu. As a matter of fact, I don't think the money was sent
back to Florida. I think she sent it to her mother's but, as I say, Mrs.
Neu knows more about that than I.
Senator Hunt. When you received the money from Mrs. Sullivan,
did it come l)y registered mail or just ordinary mail ?
Mr. Neu. Well, I would rather you asked Mrs. Neu about that, be-
cause it was addressed to her, you see.
The Chairman. Is there anything else, Mr. Rice?
Mr. Rice. Yes, sir. During the period from September to the 7th
of December 1949 — that was the period when the property was trans-
ferred to Mrs. Sullivan, and then to the Rices — was Mrs. Sullivan
or Jimmie Sullivan in Maryland?
I\Ir. Xeu. Jimmie, I can say, was not, but Mrs. Sullivan was prob-
ably in Maryland between those dates. Just what particular time, I
could not answer.
Mr. Rice. Well, it was necessary to have the deed executed by the
Sullivans?
IMr. Neu. That was executed in Florida.
Mr. Rice. It was mailed to Florida ?
714 orgatn'ized crime in interstate commerce
Mr. Next. That is right. I remember about that, because I mailecl
that myself.
Mr. Rice. Did Mrs. Neu go down to Florida during that time i
Mr. Neu. Not during tliat time; no sir.
Mr. EiCE. I think that is all.
Senator Hunt. I wanted to ask you, Mr. Neu — if I may, Mr. Chair-
man. During these negotiations and transactions and sending money
back and fortli and arranging for the payment of the monthly state-
ment from the contractor, you, of course, and Mrs. Neu, were talking
this over constantly, and you knew everything that was going on. Tell
us, why did you use these unusual methods of sending money, cash
money, through the mail ? You can answer that, Mr. Neu. You know^
why it was done. Tell us why it was done.
Mr. Neu. I have not any reason to tell you. I don't know just why
it was done. I don't know that.
Senator Hunt. You are a businessman. You know that that is not
an ordinary way to do business. Somebody w^as trying to conceal
something, and we want to know why it was and what.
Mr. Neu. I say that is a matter Mrs. Neu will have to tell you.
The Chairman. You tell us about it, Mr. Neu. You know about it.
Mr. Neu. I couldn't tell you anything about it, to tell you the truth,
because she mailed the letters; that is, Mrs. Sullivan mailed the letters
to Mrs. Neu, and there was no money went back to ]\Irs. Sullivan in
Florida. The money was kept in the Aberdeen apartment.
Senator Hunt. I thought you testified awhile ago that y(;u put the
money in a safety deposit box for a wliile. about a month, you thought,
and then it was sent down to Mrs. Sullivan !f
Mr. Neu. It was sent to Mrs. Sullivan indirectly, through Perry-
man.
The Chairman. You mean the money is still there !'
Mr. Neu. I think so.
The Chairman. You mean, with Mrs. Sullivan's mother and father I
Mr. Neu. Yes, sir.
Senator Hunt. In a bank or in the house ?
Mr. Neu. They are keeping it there.
Senator Hunt. In a safety deposit box or in the house ?
Mr. Neu. They have a separate compartment where they keep it.
I don't know wliere it is, but it is not in the bank.
Senator Hunt. Do, you know the reason why we have asked you to
come down here ? Do you know what the committee is trying to get
at?
Mr. Neu. I imagine it is an aftermath of this Florida investigation.
That is the only thing I can figure out.
Senator Hunt. How close are you to that situation ?
Mr. Neu. Well, I am Gladys's" husband. That is about as close as
I am to it.
Senator Hunt. Do you and your wife talk over the Florida situa-
tion ?
Mr. Neu. Do w^e talk it over?
Senator Hunt. Yes.
Mr. Neu. Not es])ecially.
Senator Hunt. Do you know. Mr. Neu. how nuuh money altogether
M^-s. Sullivan has sent to Mrs. Neu ?
Mr, Ni:u. No, sir.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 715
Senator Huxt. Do you know how much money Mrs. Sullivan lias
:sent to Mr. and Mrs. Ford ?
Mr. Neu. I couldn't answer that question.
Senator Hunt. How long ago did these gifts of money start ? Do
you remember when the first were received ?
Mr. Neu. Why, I would say when we started to build the home.
Senator Hunt. You do not have knowledge of any transactions, or
of Mrs. Neu receiving any sums of money prior to that time?
Mr. Neu. No, sir; I wouldn't know that.
Senator Hunt. And you do not know how much money Mrs. Sulli-
van has given Mrs. Neu altogether? You do not know the total
amount?
Mr. Neu. I wouldn't know. I would say in the neighborhood of
maybe $12,000 or something like that.
Senator Hunt. Have you got any idea of how much money they
advanced to Mr. and Mrs. Ford?
,. ^5- ?^^^' '^^' ^""' -^"^ ^ ^^^^^ ^^^^'^^ ™y ^^^® ^^y i^ ^^'^s ^ mortgage
f or $ ( ,500. That is as far as I know anything about that.
Senator Hunt. Would you think an estimate of $30,000 advanced to
a/"at ^^^'^" ^°^"^ ^^^^^ ^^ ^^'^- ^^^ would be about the figure ?
Mr Neu. I would say that that would be excessive, although, as I
^^"iVT '^' "^^^ ^^ ^^^^ familiar with that end of it than I am.
Mr. Laskey. Excuse me. Senator. Was that a combined amount
for the Neus and the Fords ?
Senator Hunt. Yes. That is all I have to ask, Mr. Chairman.
TVT o V,"-^^^^^-^^- ^^^- ^^"' flid you or Mrs. Neu get in touch with
JMrs. Sullivan yesterday or last night «
Mr. Neu. Mrs. Neu called her.
The Chairman. What was the purpose of that ?
Mr. Neu. She wanted to know- just what we should do and what all
this was about.
The Chairman. What understanding did you come to about it, if
any?
Mr. Neu. She got in touch with Mr. Laskey here and we arrano-ed
to come down to see him this morning. '^
Senator Hunt. Who got in touch with Mr. Laskey ?
Mr. Neu. My wife. '
The Chairman. Has Mr. Laskey been your attorney all aIono-2
Mr Neu. No, sir; he was recommended to us by Mr. Sulli\^n, of
-blorida. '
Senator Hunt. Has Mr. Laskey been Mr. Sullivan's attorney at
any time? "^
Mr. Laskey. I can answer that. I have never met or talked with
^XTM^ -'■ "PP^^i'ecl before this committee once before, representing a
William H. Lee.
Senator Hunt. The witness said that Mr. Sullivan phoned you
Mr. Laskey. The witness is mistaken. I did not understand him
to say that.
The Chairman. The witness said that Mr. Sullivan or IMrs Sulli-
Yan recommended to ISIrs. Neu that they get in touch with you.
Mr. Laskey. For the record, my only telephone conversations in
connection with this matter have been with Mrs. Neu last nio-ht Dr
Rodman this morning, and with a Mr. Roman today. Mr. Roman is
an attorney in Florida.
716 O'RGATSnZED CRIME IN INTERSTATE COMMERCE ,
Senator Hunt. Whom does Mr. Roman represent?
Mr. Laskf.y. Mr. Roman represented — what was the name of that
firm involved in tlie Lee transaction? Keyes Co. Mr. Roman is a
partner of Judge Hunt, who I understand represents Mr. Sullivan.
Judge Hunt is a personal acquaintance of mine and I had the pleasure
of entertaining him at dinner while he was here at the American Bar
Association convention. He has in several instances referred cases,
to me.
Senator Hunt. And he resigned as judge to take the work of repre-
senting Mr. Sullivan?
Mr. Laskey. I don't know that. I first met Judge Hunt in Florida,
where he was handling a personal matter for us on the recommenda-
tions of friends of ours in Florida, who are unconnected.
So far as I am concerned, my representation in this case is to the
Neus. I represent no one else.
Senator Hunt. And in representing the Neus, you will not m tliis
particular situation in any way attempt to protect or represent the
Sullivans ?
Mr. Laskey. It will be my sole purpose to represent and protect
the Neus, which I consider to be the only thing which I could properly
do.
Senator Hunt. I know a recent appointment you have taken, or
received, which would place you in a rather embarrassing situation,
I would think, if in any way you were connected in representing Mr.
Sullivan before this committee.
Mr. Laskey. Yes, it would. But I don't consider that that appoint-
ment would preclude my appearance before this connnittee represent-
ing clients. If it does, I would certainly take the proper steps.
There have been only these two occasions before this committee. I
would very much like your frank statements in that regard. If you
feel there is anything inconsistent, I certainly cannot stop the private
practice of law.
The CiiAimiAN. What was the.other case?
Mr. Laskey. It was also connected with the Sullivan case. It was
William H. or Walter H. Lee, involving transactions in Florida.
He was a witness before the committee, as far as I was concerned —
and he paid me. He also, incidentally, was referred to me by Judge
Hunt.
The Chairman. Is there anything else, Senator Hunt?
Senator Hunt. No, Senator.
The Chairman. There are two questions I wanted to ask. One was
the understanding that this money that Mrs. Sullivan got from the
Rices would be an understanding between you and Mrs. Neu and Mrs.
Sullivan, that the money from the Rices would be turned over to
Mr. and Mrs. Ford.
Mr. Neu. No; that money belongs to Mr. and Mrs. Sullivan.
The Chairman. Why was it turned over to Mr. and Mrs. Ford?
Was it understood ?
Mr. Neu. Yes; tliat was the request of Mrs. Sullivan.
The Chairman. Was that an agreement between Mrs. Neu and Mrs.
Sullivan, that is, that if the house was sold the money would be turned
over to Mrs. Ford?
Mr. Neu. In her keeping, for Mrs.
ORGANIZED CRIME: in INTERSTATE COMMERCE 717
The Chairman. ^A^as it supposed to be for the use of Mr. and Mrs.
Ford ?
Mr. Neu. No.
The CiiAiRiAiAN. Or just for safekeepino;'^
Mr. ]S'p:u. That is right. They are not supposed to touch il unless
Mrs. Sullivan says so. That is my undei-standing.
The CiiAiR:\rAN. Why cannot Mrs. Sullivan kee[) her own money?
I cannot undei-staiul why she has to turn it over to her father and
mother to keep it. Do you know?
Mr. Neu. I would not be able to answer that ; no, sir.
The Chairman. Give the witness this transcript about his bank
accounts, Mr. Rice, please, and ask him about these deposits and with-
drawals, and what they are for.
Mr. Rice. I am showing you a partial transcript
The Chairman. Which the cashier of the bank has testifi3d to.
Mr. Rice (continuing). Of your account at the First National Bank
in Aberdeen.
I invite your attention to deposits of $1,000 on July 8, 1949, and
$1,000 on July 11, 1949, both of which are indicated by the deposit
slips to be cash deposits. Do you know the source of those funds?
Mr. Neu. Offhand I would not know^, unless it was money that Mrs.
Neu gave me to deposit, as coming from Mrs. Sullivan.
Mr. Rice. Unless it w^as money that came from Mrs. Sullivan ?
Mr. Neu. Yes.
Mr. Rice. To Mrs. Neu and to you ?
Mr. Neu. And I deposited it to pay some of the bills.
Mr. Rice. Now, back in 1945, on October 29, there was a deposit
of $3,000. I think if I recall correctly, that consisted of a check from
Cronin, presumably on the sale of a piece of property.
Mr. Neu. Wait a minute. Oh, yes. I know about that. That was
paying off on a mortgage. That is what it was.
Mr. Rice. On a mortgage that you owned ?
Mr. Neu. Yes; that is right. I only ownied it about maybe a month
or two and the fellow paid off, see ? That is Avhat that was. I couldn't
recall for a minute wdiat that was.
Mr. Rice. Now, then, there was another major deposit on Septem-
ber 9, 1946, of $3,066.75.
I am showing you a deposit ticket dated July 11, 1949. So far as
you know, that is cash stemming from Ethel Sullivan to Gladys Neu
to you ?
Mr. Neu. I would say so; yes, sir.
Mr. Rice. I show^ you a deposit slip on July 8, the same applies to
that; is that right?
Mr. Neu. Yes, sir; I imagine so.
Mr. Rice. There is the deposit ticket on the Cronin transaction,
which was a mortgage owned by you ?
Mr. Neu. Yes, sir.
Mr. Rice. Here is a deposit ticket of September 9, 1946, in the
amount of $3,066.75, indicating a deposit of $3,000 emanating from
the Baltimore Savings Bank. Can you tell me why that money was
transferred from the savings bank to your account in the First Na-
tional Bank at Aberdeen ?
Mr. Neu. To pay some bills wnth, I imagine. Wouldn't there be an
amount paid out at the end of that time?
718 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Mr. Rice. Yes ; you had a withdraAval within 10 days of $3,000 even.
Mr. Neu. Yes ; that is right.
Mr. Rice. Do you know what that was for? What bill?
Mr. Neu. No; that is so far back I don't remember. If I knew, I
would tell you, honestly, but I don't remember; but it must have been
deposited for this withdrawal. That is the reason we put it in there.
Mr. Rice. February 2, 1948, there is a deposit of $1,720, $120 in
currency and $1,600 from the Baltimore Savings Bank. Do you
know why that money was transferred from the savings bank to
the First National Bank in Aberdeen ?
Mr. Neu. Just to pay current bills, I would say.
Mr. Rice. You had an even $1,700 withdrawal on the 9tli of Feb-
ruary, 7 days after this deposit.
Mr.' Neu. Yes.
Mr, Rice. What was your general practice in paying bills?
Mr. Neu. Well, just small bills I paid out of my weekly salary.
Mr. Rice. In cash?
Mr. Neu. No; by check. A good many of them by cash. For. "in-
stance, the telephone bills and bills like that I paid cash.
Mr. Rice. Do you have your canceled checks running back as far
as this ?
Mr. Neu. No, sir. In lO-tO I burned everything up to that time.
Mr. Rice. Your canceled checks go back how far ?
Mr. Neu. Now, maybe about 1949, the latter part of 1949. I didn't
see any use of saving them. They were just accumulating, and I had
no idea that this was coming up, so I didn't save them.
Mr. Rice. I think that is all.
Senator Hunt. I do not think I have any more questions.
Mr. Laskey. Senator Hunt, let me please get a response with re-
spect to my recent appointment.
Senator Hunt. You will have to make that decision yourself.
TESTIMONY OF MRS. GLADYS NEU, ABERDEEN, MD., ACCOMPANIED
BY JOHN L. LASKEY, ATTORNEY
The Chairman. Mrs. Neu, will you stand, please?
Do you solemnly swear that the testimony you are about to give
to this committee will be the truth, the whole truth, and nothing but
the truth, so help vou God?
Mrs. Neu. I do!
The Chairman. All right, Mr. Rice.
Mr. Rk^e. Will you state for the record vour name and address,
Mrs. Neu ?
Mrs. Neu. INIy address, my home address, is 225 Rogers Street.
Mr. Rice. And you are the wife of Richard Neu?
Mrs. Neu. That is right.
M-. Rt^'e. A^mI sister of Ethel Sullivan?
Mrs. Neu. That is right.
Mr. Rice. And the daughter of Tredick Ford and Ida Mae Ford?
Mrs. Neu. That is right.
Mr. Rice. In connection with your bank account, you have an
account at the First National B:iiik in Aberdeen in vour own name?
Mi's. Neu. Yes.
ORGANIZED CRIME IN INTERSTATE COMMERCE Tig*
Mr. Rice. And, in addition, you liavo a joint acconnt witli your
husband ? ,
Mrs. Nj:u. Tliat is ri-zlit.
Mr. Rice. Back in 1948 there were seyeral deposits made I will
lo'^nn/'^'A^'''^'''^ '^''^"^'^ Anoust 25, 1948, indicatincr a cash deposit of
5^0,000. (an you tell the connnittee the source of that money?
Mrs. Neu. Well, that was supposed to come in from my sister. That
was forthcomino- from my sister.
The Chairman. How much was that?
Mr. Rice. $3,000. From Ethel Sulliyan?
Mrs. Neu. Yes.
Mr. Rice. What was the reason for her sendino; the money to you,
or oivin(r the money to you ?
Mrs. Xeu. Well, she 'was helping us to build the house in Aberdeen^
wJiich we now liye in.
Mr. Rice. I beg your pardon ?
Mrs. Neu. This money was to apply on a house in which we are now
liying m Aberdeen.
]VIr. Rice. Was she loaning the money to you ?
Mrs. Neu. Yes, in a way, because, in "the interim, the house we were
liymg in was sold. That money was turned back to her after the
accumulation of the house being sold.
Mr. Rice. Was the money to be repaid to her?
Mrs. Neu. That is right ; that is, part of it.
The Chairman. You say a part of it. What part was to be repaid
and what part Ayas not to be repaid ?
Mrs. Neu. We sold the house for $10,500 in Aberdeen. I mean, the
house was deeded to her.
The Chatr:man. What part was not going to be repaid to her?
Mrs. Neu. Well, there was to be no part paid to her except what
was forthcoming from the house.
The Chairman. Oyer the course of this time, how much money did
you get from your sister, Mrs. Sulliyan ?
Mrs. Neu. Approximately— I guess it was around $17,000 or $18,000
or $15,000. I forget which it was. That is, for the building of this
house.
The Chairman. All the money that went to build the house you sot
from her ? "^ "^
Mrs. Neu. That is right.
The Chairman. If it cost $17,000 or $18,000, why, you got it from
her f
Mrs. Neu. That is right.
The Chairisian. When did you enter into any agreement like that?
Mrs. Neu. It was just shortly before the house was constructed,
which was, I guess, in 1948, December of 1948.
Tvr'^^xT^^'^^^^*'^^'' ^^" ^-"^^'^^^ y^^^ ^^^^^ ^^^^' ^^^'^^ y^^^ ^'^^^ vour husband,
Mr. iNeu, would like to build a house, but you did not have any
money, and would she be willing to advance the money ?
Mrs Neu. They were going to advance the money for us to start
to build a house. This was a loan until the other' house was sold,
which would be paid back to her.
The Chairman. That is the money which came from the other
house ?
Mrs. Neu. That is right.
720 ORGANIZED CRIME! IN INTERSTATE COMMERCE
The Chairman. How about the $7,000 or $8,000 in between ?
Mrs. Neu. As I say, that was just used for buMding the house.
The Chairman. Do you owe it to her, or was it a gift?
Mrs. Neu. It was a gift.
The Chairman. She just gave it to you?
Mrs. Neu. Yes.
The Chairman. All right, Mr. Rice.
Mr. Rice. AMiat was the source of Mrs. Sullivan's money ?
Mrs. Neu. That I wouldn't know.
Mr. Rice. How was the money sent to you or given to you — in cash ?
Mrs. Neu. In cash.
Mr. Rice. Was it mailed to you ?
Mrs. Neu. No; it was not mailed. She at times came up and gave
me this money.
Mr. Rice. I beg your pardon ?
Mrs. Neu. She at various times came up to Aberdeen and gave me
this money.
Mr. Rice. She delivered it to you personally ?
Mrs. Neu. Yes.
Mr. Rice. It was in cash?
Mrs. Neu. In cash.
Mr. Rice. What was the most she ever gave you at one time ?
Mrs. Neu. Oh, I don't recall.
Mr. Rice. Approximately.
Mrs. Neu. I guess maybe $4,000 or $5,000.
Mr. Rice. And Avhere did you keep that money ?
Mrs. Neu. As I said, I deposited it. That $8,000 was deposited in
the bank and I used it as I needed it for building.
Mr. Rice. Where did you keep it?
Mrs. Neu. Right in the house.
Mr. Rice. Right in the house ?
Mrs. Neu. What I had to use for building; yes.
Mr. Rice. Did you give her any receipt for the money ?
Mrs. Neu. No. '
Mr. Rice. Do you have any record as to how much she gave you?
Mrs. Neu. No.
Mr. Rice. Does she have any record ?
Mrs. Neu. No.
Mr. Rice. Was any money ever sent to you by check ?
Mrs. Neu. No.
Mr. Rice. And it was all delivered in person in cash?
Mrs. Neu. That is right.
The Chairman. In 10-dollar bills, 100-dollar bills, or what sort?
Mrs. Neu. It was in various denominations. I Avould say 20- and
50-dollar bills.
The Chairman. Would she count it out when she gave it over to
you?
Mrs. Neu. I assume slie did. I suppose so. I imagine she did. I
didn't watch her count it or anytliing.
Tlie Chairman. Did you count it when she gave it to you, to see
how much there was?
Mrs. Neu. She told me how mucli it was and handed me the money.
Mr. Rice. Did she say why she was delivering it in cash rather
than by check?
Mrs. Neu. No.
ORGATSriZED CRIMEi INT INTERSTATE COMMERCE 721
Mr. KicE. Wasn't that dangerous?
Mrs. Neu. Well, I don't know. I didn't ask her whether it was
dangerous or not.
Mr. Rice. In your opinion?
Mrs. Neu. Well, of course, I have never been used to handling money
that way myself.
Mr. KicE. Did you tell her that?
Mrs. Neu. Naturally she knows that.
Mr. Rice. What did she say?
Mrs. Neu. She didn't say anything.
Mr. Rice. Did she explain how she came into possession of so much
cash ?
Mrs. Neu. No.
Mr. Rice. You didn't ask her?
Mrs. Neu. No ; I didn't ask her.
Mr. Rice. 'I show you another ticket on the 28tli of October 1948, in
the amount of $3,000, and ask you if that is the same situation ?
Mrs. Neu. I assume it is ; yes.
Mr. Rice. You do not have any other source of cash other than Mrs.
Sullivan?
Mrs. Neu. No other source.
Mr. Rice. In addition to the money that was deposited in your bank
account, did you have other money that you kept around the house or in
a safe-deposit box ?
Mrs. Neu. The only other money I say that I had other than in the
bank was what I used for building, and that was paid out every week
and every month to the builders — or every month. I think the bills
were made monthly.
Mr. Rice. You paid all the bills on the building in cash ?
Mrs. Neu. Approximately; yes.
Mr. Rice. I show^ you a ticket dated April 11, 1919, reflecting a de-
posit from the Provident Mutual Life Insurance Co. in the amount of
$2,000. What w^as the source of that money ?
Mrs. Neu. That was the money that my husband borrowed to finish
the building of this house. We had to have it.
Mr. Rice. He borrowed $2,000 ?
Mrs. Neu. On his life-insurance policy.
Mr. Rice. He put up his policy ?
Mrs. Neu. We had to have more money to finish the payments on
this house, so he borrowed $2,000 on his life-insurance policy.
Mr. Rice. He put up the policy as collateral ?
Mrs. Neu. Yes.
Mr. Rice. Has he paid that off?
Mrs. Neu. He paid it back.
Mr. Rice. There is now no encumbrance on the policy ?
Mrs. Neu. No.
Mr. Rice. Is the Rogers Street property owned free and clear by
you now?
Mrs. Neu. Yes.
Mr. Rice. Why would you deposit a ticket, July 11, in the amount
of $515.50 ? Do you know the source of that money ?
Mrs. Neu. $515.50? No; I don't. Well, it is the same money, as far
as the source is concerned.
It
722 ORGANIZED CRIME IN INTERSTATE COMMERCE
Mr. Rice. You indicated before that all of your cash stemmed froa
Mrs. Sullivan ?
Mrs. Neu. That is right.
Mr. Rice. Now, there came a time Avhen the Bel Air property was
deeded to Ethel Sullivan ?
Mrs. Neu. That is right.
Mrs. Rice. What was the reason for that ?
Mrs. Neu. Well, the property was deeded to her for part payment or
tlie money she had given to me to build the other house. That is what
I told you before.
Mr. Rice. The property was sold to Major Rice and his wife?
Mrs. Neu. Yes. [
Mr. Rice. And what were the arrangements there ?
Mrs. Neu. Well, there was no arrangement other than that she ini
turn sold the property to them. The property was deeded to her and
she in turn sold it to Major Rice.
Mr. Rice. When the property was sold there were two checks drawn
in payment. I show you two checks dated the 1st of December 1949,
both in the amount of $5,000, drawn to Gladys Neu.
Mrs. Neu. That is right.
Mr. Rice. Why were they drawn to you rather than to the Sulli-
vans ?
Mrs. Neu. Well, because she asked us to have Major Rice pay me
the money himself, rather than pay her.
Mr. Rice. Why? " I
Mrs. Neu. I don't know.
Mr. Rice. Why were there two checks, rather than one for $10,000?'
Mrs. Neu. I wouldn't know that either.
Mr. Rice. Didn't you instruct him to make two checks?
Mrs. Neu. AVell, yes. I said she wanted to have it not in one lump
sum. She suggested that the payment be in two $5,000 dollar checks-
rather than i^^ one $10,000 check.
Mr. Rice. Why?
Mrs. Neu. I don't know.
Mr. Rice. How did she instruct you on that — by telephone?
Mrs. Neu. I think so.
The Chairman. You mean she told you to get two $5,000 checks?
Mrs. Neu. Yes. She said to make out two separate checks.
The Cpiairman. And have both made out to you ?
Mrs. Neu. Yes.
The Chairman. Why does it make any difference whether there
was one for $10,000 or two for $5,000 ?
Mi's. Neu. I don't know what the answer would be there, sir.
The Chairman. One is dated a week later.
Mr. Rice. No, Senator, they are both dated the same date.
The Chairman. I mean one was cashed a week later than the other, j
Mrs. Neu. I don't know.
The Chairman. You presented one and got $5,000 and some time 1
later you presented the other.
Mrs. Neu. I don't know that there was any particular reason for j
tliat or not. I don't recall they were cashed that Ava}'. 'i
Tlie Chairman. Look at the dates. PTold them up, Mr. Rice. i
Mr. Rice. The perforated cancelation indicates "Paid 12/2/49" and
this one is perforated "Paid 12/7/49" and there has been testimony
I
ORGAMZED CRIMEl IN INTERSTATE COMMERCE 723
lat they were presented at the First National Bank on those dates
1(1 cashed.
Mrs. Neu. Well, that is ri^ht then.
Mr. RrcE. Did yon do that ?
A I rs. Neu. Did I cash the checks ?
Mv. EicE. Yes.
Mrs. Neu. Yes, I cashed the checks.
Mr. RrcE. Why did yon do it on the 2(1 and then again on the 7th «
Mrs. Neu. It was no particnlar reason, as I say. 1 don't know
li.\. Ihere was no reason for cashing them at separate times.
Mr. KicE. What did yon do with the money when you received ii
: tlic bank?
Mis. Neu. I held it for her to come up to pay her.
.Mr. Rice. The $10,000?
Mrs. Neu. To give her the money back; yes.
Mr. Rice. Why did you hold it?
Mrs. Neu. At home?
Mr. Rice. At your home.
Mrs. Neu. I held it at the home for the time being, then later on I
^ive it to my mother.
Mr. Rice. "Mrs. Ford?
Mrs. jSeu. Yes.
Mr. Rice. How much later was it delivered to Mrs. Ford?
Mrs. Neu. I don't recall that either.
|Mr. Rice. Was it a month?
':^frs. Neu. No; I don't think it was that long. Maybe it was a
rpnth or 2 weeks or 3. I just don't remember it now.
Mr. Rice. Why did you give it to Mrs. Ford?
Mrs. Neu. I have no reason for doing that either.
^Ir. Rice. It was Mrs. Sullivan's money, was it not ?
IVfrs. Neu. Yes.
Mr. Rice. Did she tell you to give it to Mrs. Ford?
Mrs. Neu. She was to come uj) with something at the time and I
2ve it to her to give it to my sister.
Mr. Rice, Were you not there ?
Mrs. Neu. Yes; I was there.
Mr. Rice. What did Mrs. Ford do with the money?
Mrs. Neu. She kept it to give to my sister.
Mr. Rice. Does she still have it?
VIrs. Neu. I think she does.
Mr. Rice. Where does she keep it?
VIrs. Neu. In the house.
;^r. Rice. Whereabouts in the house?
VIrs. Neu. I don't know.
Vlr. Rice. During the time that you were negotiating this sale of
I Bel Air Aveinie property to the Rices, the record owners were the
■lllivans, were they not?
•Irs. Neu. That is right.
dr. Rice. And who agreed on the selling price?
drs. Neu. She did. She agreed to what she wanted for it. Of
X rse, we naturally tried to get as much as we could for the house.
Ir. Rice. How did you get her agreement?
Irs. Neu, I asked her,
Ir. Rice, By telephone?
724 ORGANIZED CRlMEi IN INTERSTATE COMMERCE
Mrs. Neu, By telephone.
Mr. KicE. Did she come up during that period ?
Mrs. Neu. No; I don't think so.
Mr. Rice. She didn't appear in Aberdeen during the time?
Mrs. Neu. No.
Mr. Rtce. Then there came a time when she agreed that the price
was all right and said to go ahead and close the sale?
Mrs. Neu. Yes.
Mr. Rice. And the deed was sent to Florida and signed?
Mrs. Neu. Yes.
Mr. Rice. Have you ever seen the deed ?
Mrs. Neu. Yes ; it was returned to me, I think.
Mr. Rice. You did not take it down to Florida ?
Mrs. Neu. Oh, no.
Mr. Rice. I show you deed dated 1st of December 1949 and ask you
if that is your signature ?
Mrs. Neu. That is.
Mr. Rice. That is, as witness to the signature of Ethel and James
Sullivan ?
Mrs. Neu. Yes, that is my signature.
Mr. Rice. Did you see them sign it ?
Mrs. Neu. No; I didn't see them sign it ; no.
The Chairman. Senator Hunt, do you have any questions?
Senator Hunt. Mrs. Neu, do I understand you to say tliat you had
not received any money in cash through the mail from Mrs. Sullivan^
Mrs. Neu. No.
Senator Hunt. You are real sure of that ?
Mrs. Neu. I don't think so.
Senator Hunt. How much money have you received altogether from
Mrs. Sullivan?
Mrs. Neu. Well, I don't know. As I say, it would amount to the
cost of the construction of this property.
Senator Hunt. As the situation now stands. Mrs. Sullivan has ad-
vanced to you roughly seventeen or eighteen thousand dollars?
Mrs. Neu. Yes.'
Senator Hunt. To her directly you have returned nothing, but you
have returned $10,000 to her mother?
Mrs. Neu. That is right.
Senator Hunt. And her mother is now keeping this $10,000 in her
house as far as you know?
Mrs. Neu. Yes.
Senator Hunt. Can you give us any reason for that most unusual
situation of keeping $10,000 in a house?
Mrs. Neu. No; I can't.
Senator Hunt. I do not have any other questions, Senator.
Mr. Rice. Do you have a new automobile ?
Mrs. Neu. Yes, we do.
Mr. Rice. What is it?
Mrs. Neu. A Chevrolet.
Mr. Rice. Is that paid for?
Mrs. Neu. It is.
Mr. Rice. What was the source of the funds for that?
Mrs. Neu. My husband sold Government bonds. There was no
Florida money involved in the car.
ORGAlSnZED CRIME! in INTERSTATE COMMERCE 7255
I\Ir. Rice. Has Florida money been involved in any other purchases
of furniture or furnishings?
Mrs. Neu. No. The onh' money that was forthcoming from Florida
was the construction of the house; I told you before.
The CiiAimrAN. How about paying back the mortgage of $2,000.
Mrs. Neu. What mortgage?
The Chairman. I don't mean the mortgage, I mean the loan on your
husband's insurance.
Mrs. Neu. That was paid back by the money, as I say, because at the
time we had to have the money to pay off the bills, and we did not have
it until other money was forthcoming. So he borrowed on his life-
insurance policy to pay it.
The Chairman. Mrs. Neu, there is one other matter I wanted to
get straight.
When you got this $10,000 and got the cash there on the '2d and the
7th of December, why did you not put it in your bank account? You
had a bank account?
Mrs. Neu. Well, I didn't want to put it in any bank account.
The Chairman. Why?
Mrs. Neu. Because I didn't think; I just didn't want to do it.
The Chairman. Wouldn't you think it would be safer in your bank
account than in your home?
Mrs. Neu. It wasn't my money to start with, and I was going to
return it where it belonged ; because the deal was made that she was to
get-
The Chairman. Why did you not put it in your bank account and
get a certified check? That would certainly save the danger of a theft
or fire?
Mrs. Neu. I don't know why I didn't.
The Chairman. Did you ever do that before, that is, have big sums
of money on hand?
Mrs. Neu. Never.
The Chairman. You had a bank account?
Mrs, Neu. Yes.
The Chairman. You do not know of any reason why you did not
put it in your bank account?
Mrs. Neu. No. Because, as I say, that money was still hers. So I
got the cash, and that was to be returned to her.
The Chairman. Why did you not get the check made to her ?
Mrs. Neu. Because she requested the checks made to her?
The Chairman. Then, when you got the monej^, why did you not
deposit it and send her a check?
Mrs. Neu. That I don't know.
The Chairman. There must be some explanation of this. We are
just trying to get at the facts.
It is a strange thing, I think you will admit, for big sums of money
to be floating around like this when people have bank accounts.
]\Irs. Neu. Yes, I do.
The Chairman. You take the risk of having money around in your
house when you had a perfectly good bank account where you could
put it. There must be some explanation. What is your idea of that?
Mrs. Neu. As I say, the money was not mine, and I certainly did
not want it there, and I didn't want to deposit it in any checking
account.
726 • ORGANIZED CRIMEl IN INTERSTATE COMMERCE
The Chairman. Of course, you could have opened a special account
-to her.
Mrs. Neu. I suppose I could. But I have never handled finances
like that before, so 1 just didn't know.
The Chairman. You got the money; $5,000 first, and where did
you take that to?
Mrs. Neu. That was api^lied on the house.
The Chairman. I know\ I am talking about after the house was
sold. That is, when you sold the Bel Air house.
Mrs. Neu. Those two ? We kept them, as I told you, and then gave
them to my mother.
The Chairman. I know ; but you got the $5,000 at the bank, and I
suppose you put it in your purse ?
Mrs. Neu. No ; I didn't put it in my purse. I took it home for the
time being.
The Chairman. You put it in your purse to take it home, did you
jnot?
Mrs. Neu. That is right.
The Chairman. Then vou put it somewhere at home?
Mrs, Neu. I left it in the house.
The Chairman. Did you put it in a tin box?
Mrs. Neu. No. I just left it in a dresser drawer and gave it to her
-that day or the day thereafter. I do not remember now.
The Chairman. You gave her the first $5,000?
Mrs. Neu. And then I gave her the $10,000.
The Chairman. Had your sister already instructed you when you
got the cash to turn it over to your mother?
Mrs. Neu. That is right.
The Chairman. You don't know why you got it on two different
occasions?
Mrs. Neu. No; I don't.
The Chairman. Why did you not have your husband put it in the
safety-deposit box ; he had one ?
Mrs. Neu. I don't know that.
The Chairman. It never went into the safety-deposit box?
Mrs. Neu. These checks?
The Chairman. No : this $10,000.
Mrs. Neu- I don't think so.
The Chairman. You would know whether it did or not. You
had it.
]\Irs. Neu. I don't think he ]nit it in the safety-deposit box.
The Chairman. Who kept the money — you or him ?
Mrs. Neu. I did all the transactions on the house.
The Chairman. I mean, after you got the $10,000, did you keep
the money ?
IVIrs Neu. Yes; I kept the money.
The Chairman. He never had his hands on it?
Mrs. Neu. No; he never entered into any of the transactions at all.
The Chairman. And you think a day or two after you got it you
took it over to your mother?
Mrs. Neu. As I say, I don't know^ how many days it was, or how
long it was, but anyhow it was delivered to her.
The Chairman. Within a few days ?
Mrs. Neu. Yes.
ORGANIZED CRIMEl IN INTERSTATE COMMERCE 727
The Chairman. And you had it in your possession all the days
between the time you got it out of the bank and until you took it over
to your mother ?
Mrs. Neu. That is right.
The Chairman. That has been almost a year ago, has it not?
Mrs, Neu. I guess it has.
The Chairman. December 1049. Do you know why it was left
again ? Wasn't there any correspondence or any word or reason given
to you why it should be left with your mother?
Mrs. Neu. That is where she wanted it.
The Chairman. Was it a gift to your mother?
Mrs. Neu. This money?
The Chairman. Yes.
Mrs. Neu. I don't know whether she has given it to her or not.
The Chairman. You don't know wliether it is your sister Ethel's
money or whether it is your motJier's money?
Mrs. Neu. I don't know. It is not in my possession, so I don't know.
I don't know whether she intended for her to have it.
The Chairman. Your mother has a bank account?
Mrs. Neu. I think she has.
The Chairman. Do you know why she doesn't put it in the bank?
Mrs. Neu. No.
The Chairman. She just keeps it around the house?
Mrs. Neu. Yes.
The Chairman. I think that is all I have.
Senator Hunt. Mrs. Neu, do you know how much money yOur sister
has given to your mother?
Mrs. Neu. No ; I don't.
Senator Hunt. Do you have any idea at all?
Mrs. Neu. Well, the only thing that I know anything about is a
mortgage.
Senator Hunt. That was what ? In the amount of $6,800 ?
Mrs. Neu. No ; I don't think so. I think it was $7,500.
Senator Hunt. $7,500, and then the $10,000 that your mother still
has in cash. Then there was some additional, over and above the
$10,000 from your sister to you, which you have not returned to your
sister because she has not asked you for it.
Tlie Chair^fan. That is a gift, as I understand it.
Mrs. Neu. Yes. I don't have any money left myself at all.
Senator Hunt. You paid it out on the house ?
]\Irs. Neu. Yes.
Senator Hunt. What we are trying to do is to arrive at the figure
of how much money the sheriff of Miami has advanced in these
transactions.
Mrs. Neu. I told you that it went to the construction of this house.
That is, as far as I am concerned. Of course, the other money, the
mortgage money, of course, I had nothing to do with at all. That did
not enter at all.
Senator Hunt. You talked to your sister last night on the telephone,
did you not?
Mrs. Neu. Yes; I did.
Senator Hunt. Would you tell us what the conversation was?
Mrs. Neu. I told her that we had been subpenaed yesterday, much
to my surprise. I asked her what to do. She said we would have to
go down. So that was about all there was to it.
68958— 50— pt. 1 47
728 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
Senator Hunt. Did you talk over these transactions, and discuss
what your testimony would be today ?
Mrs. Neu. No; because I did not know. This is the first time I
was ever subpenaed, so I did not know what the questions might be,
or anythino; pertaining to them.
Senator Hunt. That Avas the extent of your conversation ; that is,
you just told her you were coming clown here ?
Mrs. Neu. I told her we were subpenaed and summoned to Wash-
ington today.
Senator Hunt. How long were you on the phone with your sister?
Mrs. Neu. I don't know.
Senator Hunt. Was it 2 minutes? or 5 ? or 10 ?
Mrs. Neu. Well, I wouldn't know that either. It was just a con-
versation. I was so nervous, I didn't know what I was doing. I
don't know whether it was 5, 3, or 4 minutes. I don't know. I did
talk to her.
Senator Hunt. There is absolutely nothing wrong with the trans-
actions, as far as you are concerned, so why should you be nervous?
Mrs. Neu. I mean, this sort of thing upsets me. As I say, I have
never been subpenaed before, or have never been before a court before,
and it does upset me.
Senator Hunt. I do not think I have any more questions.
The Chairman. Well, now, let me ask you this, Mrs. Neu. Your
sister never had any fortune or any big estate of her own, did she?
Mrs. Neu. Not that I ever knew of.
The Chairman. Just whatever salary or whatever money her hus-
band makes ?
Mrs. Neu. That is right.
The Chairman. When she so magnanimously agreed to advance
$17,000 or $18,000, do you have any idea as to where all that money
was coming from, or how she could afford it?
Mrs. Neu. No; I did not. I knew that Jim was, of course, the
sheriff of Miami, and I knew he had a fairly decent salary. Other than
his real-estate transactions, I don't know anything about any other
money.
The Chairman. How many of you children are there?
Mrs. Neu. Four.
The Chairman. Two sisters?
Mrs. Neu. That is right.
The Chairman. Where are the brothers?
IMrs. Neu. I have a brother in New York and one in Philadelphia.
The Chairman. What do they do?
Mrs. Neu. I think one works at ]\Iitchell Field in New York, and
the other one is in the contracting business in Philadelphia.
Tlie Chairman. Has she done things like this for other members
of the family?
Mrs. Neu. Not that I know of.
The Chairman. You don't consider that you owe her this $7,000
or $8,000 difference ? Do you consider that a gift ?
Mrs. Neu. As far as I am concerned, it was a gift.
The Chairman. There was not any agreement about repaying, or
anything of that sort?
Mrs. Neu. No ; other than this house.
The Chairman. Just whatever she got out of the house would be
repayment ?
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 729
Mrs. Netj. Yes.
The Chairman. Whether it would be $10,000 or $9,000 or $11,000,
or whatever it mioht be?
Mrs. Neu. That is right.
The Chairman. What Avas the transaction about fier paying- off
this $7,500 mortgage? Hom' did that come about? Do you know?
Mrs. Neu. I wouldn't know anything about that arrangement at
all. All I know is that she picked up the mortgage on that property,
and that is all I know.
The Chairman. Mr. Laskey, do you have any matters there that
you wanted to bring out ?
Mr. Lasket. No; I merely wanted to file this telegram which I
received from Dr. Rodman. As I say, I have no personal knowledge
of those facts, or Mr. Ford's condition.
The Chairman. That will be filed and made a part of the record.
(The telegram referred to is as follows:)
Aberdeen, Md., September 26, 1943.
Mr. John Laskey,
Albee BuUdlng, 1426 G Street NW., Washington, D. C:
To protect physical status of my patient, Trecl Ford, Ferryman, Md., must
examine to drtermine his physical fitness to appear before investigating com-
mittee. Kindly defer action until time permits examination.
Peter P. Rodman, M. D.
The Chairman. Is Mrs. Sullivan older or younger than vou, Mrs.
Neu? _ ^ ^ . , ^
Mrs. Neu. She is younger.
The Chairman. How old is she?
Mrs. Neu. She is 47, 1 think.
Senator Hunt. I have no other questions of Mrs, Neu.
The Chairman. Mrs. Neu, we will excuse you. But first, let me
ask you :
Do you have any correspondence with you from your sister ?
Mrs. Neu. No; 1 do not, whatsoever.
The Chairman. It was all on the telephone ?
Mrs. Neu. That is right.
The Chairman. Do you call her or does she call you ?
Mrs. Neu. She usually calls me.
Mr. EicE. Don't you call her collect occasionally?
Mrs. Neu. Collect. I can't afford long-distance calls.
Mr. Rice. Did you call her collect last night?
Mrs. Neu. Collect ; yes.
Mr. Rice. Did you talk with Jimmie Sullivan about these trans-
actions at all ?
Mrs. Neu. Recently, you mean ? No.
Mr. Rice. Any time.
Mrs. Neu. No.
Mr. Rice. Has he been up to Aberdeen ?
Mrs. Neu. Not lately ; no.
The Chairman. Did he bring any of this money ?
Mrs. Neu. Never.
The Chairman. She brought it all ?
Mrs. Neu. Yes.
The Chairman. He wouldn't drive up with her on these occasions?
How did she come ? Did she drive ?
Mrs. Neu. Sometimes she came by train and sometimes she drove.
730 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
The Chairman. Without money like this, you could not have built
this house, could you ?
Mrs. Neu. No ; because we don't have money like that. My husband
works on a salary.
The ChairsIan. You have been always like a Senator, sort of poor
people ?
Mrs. Neu. That is right.
The Chairman. We understand that situation, Mrs. Neu.
Mrs. Neu. But, as I say, as far as I am concerned, the whole thing
was a gift.
The Chairman. We have no right to question that, and we do not
question it, Mrs. Neu.
But I must say to you that with you and your husband having bank
accounts and your mother having a bank account, this is a very strange
way to handle cash transactions.
Mrs. Neu. As I say, it was all very new to me, because, as I told you
before, I have never handled any amounts of money before. Of
course, I was advised to do it that way, so that is the way I did it.
The Chairman. All right. Thank you, Mrs. Neu.
(Witness excused.)
(In view of the reported physical inability of Mr. Tredick Ford
to appear before the committee to testify personally, the following
signed statement was received and made a part of the record:)
We, Tredick Ford and wife, May Ford, of Ferryman, Md., make the follow-
ing voluntary statement to Downey Rice who has advised us that he is assistant
counsel of the Senate Special Committee To Investigate Organized Crime in
Interstate Commerce :
We are residents of Ferryman, Md., and the parents of Ethel Sullivan, tne
wife of James Alexander Sullivan, now residing in Miami, Fla. We are also
the parents of Gladys Neu.
For many years we have owned the farm where we now live at Ferryman, and
until 194.") there was a mortgage of approximately $6,800 on the farm held by
Mi-s. Mary Mitchell, of Aberdeen. In 1945 our daughter Ethel visited us at
the farm and wanted to do something for us. She arranged with us to have
certain improvements made on the farm. Ethel gave us about $1,000 cash,
which was used to pay for these improvements.
Shortly after this Ethel gave us sufficient cash to pay off the $6,800 mortgage,
which was done in July of 1945.
In October of 1945, we gave a mortgage on the farm to Ethel and her husband,
Jimmie Sullivan, in the amount of $7,500. It has not been necessary for us
to pay any interest or curtail on this mortgage since.
When the Sullivans sold the house on Bel Air Avenue in Aberdeen to Ma.i.
and Mrs. Thomas A. Rice in the fall of 1949, $10,000 of the proceeds from the
sale of the house was delivered to us in cash by Gladys Neu for safekeeiiing at
the farm. It was our understanding that Ethel had directed that the money
ibe kept this way and that she would call for it when necessary. Although Ethel
—as in Ferryman during the summer of 1950, and we reminded her of the fact
that we were holding the money for her, she asked us to continue to keej) it for
her. As yet, she has not called for the money and we still retain it at tlie farm.
We have no information regarding the source of the money coming from Ethel
and Jimmie Sullivan in Florida except that we understood that Jimmie had
made some money in real estate there.
The foregoing statement consisting of one and one-half pages has been read
by us, and we willingly sign it as it is true.
Witnessed :
Tredick Fokd.
October IS, 1950. May H. Ford.
(Whereupon, at 5 : 25 p. m., the committee adjourned, subject to the
call of the Chair.)
APPENDIX
Exhibit No. 40
Henry Pellino, C. P. A.,
New York, N. Y., Thursday.
Dear Abe : Just spoke to Frank over the phone, and he asked me to send you
this air-mail letter to tell you to have that declaration of estimated 1943 tax
made up and send it on to me so that I may get the money and pay for it. I
think your collector is in St. Petersburg. Is that right?
Best of everything to you, Abe. Guess I'll never get around to going to Florida,
Sincerely,
Andy.
Henry Pellino, C. P. A.,
New York, N. Y., Septeniber 11.
Dear Abe : Mailed my check to the collector in .Jacksonville, Fla., today for
$7,105 as per your declaration. Hope 1 sent it to the right place. I remember
it as Jacksonville. You made the mistake of taking full credit for your 1942
tax instead of half, which is what I paid on in thus far. But I let it go the way
you had it. It's not important, tis it is only an estimate, and I think you will
come very close.
Getting back to your relationship with Frank there, Frank wants to take
up his profit as he received it, which is O. K. in my opinion if you take up the
entire half and take as a deduction whatever money you give Frank out of
profits during the year. As I understand it, Frank is not on record as a part-
ner of the hotel, which makes it O. K. He has a 50-percent interest in you
which is not known to the partnership and doesn't even have to be known
by your other partner. However, if Frank is on record as a partner on your
books, then it is wrong for him to handle it his way, and he should take up
25 percent .of the partnership profit even though he hasn't received it in cash.
Anyway, I wish you would write me a confidential letter and let me know if
Frank is on record at the hotel. That's all for now. Oh, I haven't copies of
your returns for 19.38-39-40-41, and Frank wants to have them. I am enclosing
forms for all these years except 1938, which I don't have. Explain to your
accountant what you are doing with Frank and get his reaction. Write me
if things are confusing to you. Bestest.
Sincerely,
Andy.
Henry Pellino, C. P. A.,
New York, N. Y., January 19, 1944-
Dear Abe : For your information, vou paid out during 1943 in taxes the follow-
ing : March 10, $557.62 ; June 5, $557.62 ; total, $1,115.24.
The above amount paid should be shown on Form 1125, which Uncle Sam
will send you with your blanks. Then, on September 11, you paid on a declara-
tion the amount of $7,105. All of the above figures you will take credit for when
preparing your 1943 return. As far as I know, you paid nothing for the last
quarter of 1943, as you were supposed to have filed an amended declaration to
show you owed nothing. This was because of the change in the way you take
up the profit in the Wofford. Unless you know the above figures, do not throw
this letter away. Kind regards.
Sincerely,
Andy,
731
732
ORGANIZED CRIMEi IN INTERSTATE COMMERCE
Exhibit No. 100
THiS W!L}_ CERTIFY TMA'
SHERiTF or r '< t
^t- y >^v B ' o '.
^^^0«ARy DEPUT-f
STATE OF FLORIDA. COUNTY OF DADE:
Sisjoat All Mm hu ^iit&t ^resmts
fhiUui this
iht^ of
/'»'
NJC^
400
ORGATSTIZED CRIMEi IN INTERSTATE COMMERCE 733
Eyitip.it No. 101
Exhibit No. 102
June 15, 1944.
Miami Beach Kenxel Club,
Miami Beach, Fla.
(Attention Mr. Hugo Bennett.)
Gentlemen : The following figure, .$44.92, represents hotel bill and charges of
Mr. W. H. Johnston and party during their stay at the Wofford Hotel June 12, 13,
14 — sheriffs' convention.
Thank you.
Yours very truly,
Abe Allenberg, Managing Director.
AA/bf
734 ORGANIZED CRIME! IN IXTERSTATE COMMERCE
Exhibit No. 103
KuLLMAN Dining Car Co., Inc.,
Harrison, N. J., September 27, 1948.
Mr. A. Allenberg,
Blaclcstone Hotel, Miatni Beach, Fla.
Dear Abe : I am over at the Kullman Dining Car factory, at which you know
my friend Sam just completed building me a beautiful diner. I would like to
have you do me a favor that would be helpful to me and my friend Sam. He has
just sold a new diner that is going to 5560 Northwest Seventh Avenue, Miami,
Fla., and the same boys, whose names are E. J. Averman, Jr., and C. A. Youngs,
Jr., whose address is 4321 Northwest Thirty-sixth Street (Air Chef Diner), Miami
Springs, Fla.
They are having difficulties with the electrical inspectors due chiefly to wiring.
"We encounter this from time to time, and a few dollars will fix everything up.
However, the chief electrical inspector's name in Miami is Knox, and his assist-
ant's name is Cousen. If you will contact these two men personally, or have
your emissary in Miami take care of them and see that this thing is accepted, it
would help things a great deal.
The fire underwriters of the State of New York accept Sam KuUman's work;
and, as I said, a little fixing will take care of the whole matter. Please let me
know at once, as I want Sam to do favors for me.
Kindest personal regard.
,. Jim Ponzio.
P. S. — I understand that Senator Pepper is the man to give the O. K.
Exhibit No. 104
Democratic National Committee,
Washington, D. C, May 6, 19.',7.
Mr. Abe Allenberg,
Boulevard Hotel, Miami Beach, Fla.
Dear Mr. Allenberg : We are very grateful to you for participating in the
Miami Jefferson jubilee dinner. Y'our assistance proved of material help to the
Democratic Party in preparing for its 1948 Presidential campaign.
Chairman Hannegan joins me in expressing our sincere appreciation for your
cooperation, and I am enclosing an official treasurer's receipt for your contribu-
tion in the amount of $2,500.
Sincerely,
George Killion.
No. 856
Democratic National Committee,
Washington. D. C, March 31, 19Jf7.
Received $2,500 from Abe Allenbei'g, Boulevard Hotel, Miami Beach, Fla., con-
tribution to Democratic National Committee.
George L. Killion, Treasurer.
Exhibit No. 105
Law Offices, Raphael W. Alpher,
Lijnhrook, N. Y., August 4, 1948.
Mr. Abe Allenberg,
Ca7-e of The Blackstone Hotel,
Miami, Beach, Fla.
Dear Abe : Thaidv you for your letter. However, in the meantime I have
settled this Avhole business on a basis of a cash payment to get rid of this crowd.
Sorry I didn't wait to talk to you about this before I took any action.
In the meantime I uiulerstand that this bunch thi'ough a Mr. I'erlman or
l'erll)erg have contact with the (Jovernor-elect. If you have it within your power
to advise what kind of people they are, I suggest you do so.
Yours vei\v truly,
Ralph.
ORGANIZED CRIME! in INTERSTATE COMMERCE 735
Exhibit No. 106
Grand Jury Report, Spring Term, A. D. 1949, for Dade County, Fla.
(Filed November 7, 1949)
IN THE CIRCUIT COURT OF THE ELEVENTH JUDICIAL CIRCUIT OF FLORIDA IN AND FOR
THE COUNTY OF DADE, SPRING TERM, A. D. 1949
Walter E. Morris, foreman; Bernard S. Karmiol, vice foreman; T. Thurston
Ritter, clerk; Peter L. Anton, Charles W. Dabney, Roger E. Eikenberry, Leo
J. Goldman, Jack C. Harmon, Harold M. Hirsh, John V. O'Brien, Russell S.
Oakleaf, Frank J. Raufer, Samuel Silverman, N. Sirgany, George W. Smith,
Jack Sweralm, C. R. Vaughn, Jack H. Venable.
Glenn C. Mincer, State attorney; John W. Frunty, assistant State attorney;
Harvie S. DuVal, assistant State attorney
Final Report of the Grand Jury
To the Honorable Judges of the Circuit Court of the Eleventh Judicial Circuit
of Florida:
We, the grand jury, were duly impaneled on the 10th day of May, spring term,
1949, by the Honorable Stanley Milledge, one of the judges of the Circuit Court
of the Eleventh Judicial Circuit of Florida.
CAPITAL CASES
We have considered six capital cases and have disposed of these cases by tlie
following action :
State of Florida v. Jeffie L. McClurc — Indicted for murder in the first degree.
State of Florida v. Mack Arthur Bailey — Indicted for murder in the first degree.
State of Florida v. Arstell George Johnson — Indicted for murder in the first
degree.
State of Florida v. Albert Jones — Indicted for murder in the second degree.
State of Florida v. Milton E. Renegar — Indicted for murder in the second degree.
State of Florida v. Islick Boniira — Indicted for fondling and lewdly and lascivously
assaulting a child.
On the 28th day of July 1949 one of the defendants indicted by this grand jury
for murder in the first degree, JeflSe L. McClure, filed in the circuit court her
motion to quash the said indictment on the ground that the said indictment re-
turned by this grand jury on the 2;M day of June 1949 was null and void, for the
reason that this grand jury, consisting of 18 jurors as provided for by FSA
Chapter 905, had been discharged by operation of law, chapter 25.554, Laws of
Florida, 1949, which became effective the 13th day of June 1949 ; said chapter
provided that in all counties having a population of 315,000 or more according to
the last State or Federal census, a grand jury should consist of 23 jurors and
further provided that all laws in conflict tlierewith be repealed. There was no
saving clause in chapter 255.54, Laws of 1949, expressly providing that this cur-
rent grand jury should remain in session.
That thereafter the said motion to quash came on to be heard before the
Honorable George E. Holt, one of the circuit judges, who entered his opinion and
order on tlie 24tli day of August 1949 denying the relator's motion to quash the
said indictment and declaring chapter 25554, Laws of Florida, 1949, as being
unconstitutional.
Whereupon, the defendant, JeflEie L. McClure, filed her petition for writ of habeas
corpus in the supreme court, which said writ was issued on the 13th day of Sep-
tember 1949. And that at the time of the filing of this report the said cause is
still pending and undecided in the Supreme Court of the State of Florida.
Based upon these facts and circumstances and uncertainties, the State attor-
ney. Glenn C. Mincer, informed this grand jury that until the supreme court had
written an opinion deciding the legality of this grand jury he would not present
any additional capital eases.
PRELIMINABY
During our preliminary investigation we studied reports of previous grand
juries, which indicate that certain undesirable and unhealthy conditions have
existed in this community over a considerable period of time. As citizens we were
736 ORGANIZED CRIIVIEI IN INTERSTATE COMMERCE
aware of many of these conditions and their existence lias been corroborated by
testimony of witnesses who appeared before ns and satisfied us that tliey were
qualified and competent to testify and that they knew whereof they spoke. We
could not see any purpose in repeating the work of our predecessor juries to
discover oflicially and at great length that crime and corruption do exist here.
This point has been well documented in the past but apparently discouragingly
little, if any, real improvement seems to have resulted from such exposes. It
was thus apparent that our problem was not how to establish that certain
unsalubrious conditions exist, but rather what could be done about them. In
casting about for the answer to this question, we quickly learned that while a
grand jury is considered to be all powerful, there are many factors involved
which tend to handicap such a jury and to prevent it from actually being a
cogent agency for law enforcement. Some of these factors are :
Lack of a reporter for the taking of testimony, making it necessary that
the jurors depend solely upon memory in drawing up their reports.
Lack of funds for the employment of investigators.
Limitations on the time the jurors can devote to the affairs of the jury
over an extended period, due to the necessity of earning their livelihood.
These coupled with the fact that the jurors themselves are laymen, make it
difficult for a grand jury to go about accomplishing the desired end.
This grand jury viewed with approbation the action of the 1949 Florida State
Legislature in its passage of certain laws which were intended to strengthen
the present grand jury system. Unfortunately, however, because of certain
technicaiities involved in these laws, our position was not strengthened as a
consequence, but instead our investigations were most severely handicapped.
The paramount issue affecting us is now pending a hearing before the State
supreme court but apparently because of the time element a decision will not
be rendered until after our term has expired.
CONGREGATION OF CRIMINAL ELEMENT IN OUR COMMUNITY
There is present in our community a large number of Individuals of unsavory
reputation. These persons are criminals of national stature. Their records
show that their activities have occurred in many of the cities throughout our
country. What has brought them here to concentrate among us we do not
know. Perhaps the mild climate which has attracted so many Americans to
settle here has also attracted them. Perhaps our community has attracted them
as a refuge or haven, where they have not committed any criminal acts, and so
they feel that they are immune from interference by our local law-enforcement
agencies. It would be un-American for us to want to harass a man merely
because he has a criminal record. If he is wanted by the police somewhere
he .should be made to stand trial and pay the penalty for his crime. If he is
not wanted, or has already been discharged from an institution, he should be as
free to move around as any other citizen. However, the fact remains that our
commimity is fast becoming the national capital wherein the so-called leaders
of the criminal element of numerous communities through the land are con-
gregating.
These men are settling among us under the cloak of respectability. Their
passion here is complete anonymity. They purchase and operate legitimate busi-
ness enterprises as evidence of their respectability among us, and they become
our neighbors. We have, to thank the ceaseless efforts of the Miami Crime
Commission for incessantly stabbing through the gloom of obscurity in which
these individuals seek refuge, and illuminating them with the searchlight of
identificntion as to who they are and what the danger is to our community.
TTie liistory of these individuals shows that they live by violence, and in that
lies their danger to our community. At present they may not appear to be en-
gaged in illegal activities here, and instead they appear to be inactive, as would
a retired businessman, or they may appear to be engaged in a legitimnte business
activity. Yet, the record shows that they have continued to maintain their
ties widi the gangs in the communities from which they originate. Also, by the
nature of tlieir prediliction to violence, they are a menace to the businessman of
the community. There is no doubt but that tliey would resort to the gangster
strong-nrm methods to overcome the ordinary law-abiding citizen who would have
the misfortune to best them in competition for business.
They attract hangers-on and henchmen, who do not have their nflluence. but
who do desire to have a supply of money for ready and easy spending. These
men resort to crimes of violence, and when they are in our midst, our crime
ORGANIZED CRIME' IN INTERSTATE COMMERCE 737
rate soars to such an extent that onr local law-enforcement agencies cannot
cope with it.
We believe that the activities of these so-called important gangsters and
racketeers are beyond the scope of onr local law-enforcement agencies. We feel
that the Federal Government would find it a very profitable field to investigate
these people regarding the sources of their income and the origins of their wealth
by which they can live in such ostentation among us and purchase valuable and
expensive properties and businesses. We feel that proper investigations of these
individuals would reveal violations of Federal laws just as investigations in the
past have done with other criminals who rose to wealth and notoriety. We
recommend that a coordinated investigative body froni the various Justice and
Treasury Department units be established here to look into these persons'
activities.
GAMBLING IN DADE COUNTY
Law enforcement in Dade County has been and still is confronted with the most
powerfully organized, most insidious form of gambling, namely, bookmaking.
We could elaborate on this subject in connection with our investigation but we
feel it would only be a repetition of what is contained on the subject in the
admirable report of the grand jury for the winter term of 1947.
After questioning witnesses we found that during the summer of 1949 laxity
in enforcing gambling laws had not changed much relative to previous periods.
At the time we made an investigation into gambling activities in Dade County
it was revealed that bookie operations in the city of Miami and the city of
Miami Beach were running on a sneak basis, while the "county" was wide open to
anyone desiring to vi.sit the well-appointed, air-conditioned places set up for
card games, dice games, roulette, and bookmaking. The "county" is a term ap-
plied to the unincorporated areas where only the sheriff and the constables have
law-enforcement powers. Bookmaking in the summertime is done on a sneak
basis simply because the "heat" is usually on and the business is not as lucrative
as it is during the winter months.
In Miami bolita and the numbers racket were flourishing. There appeared
to be little effort to curb these gambling operations, although they were being
carried on under the eyes of the police.
Conditions apparently have not changed since the writing of the 1944 grand
jury report. There is too much laxity and indifference toward law enforcement
with respect to gambling and vice resulting from politics and graft. The only
means by which the people of Dade County can be protected against the influ-
ence of organized gambling and racketeers is by impartial and efficient enforce-
ment of the laws. If the people of Dade County desire that organized crime be
destroyed it can be destroyed. The facilities required are available in the choice
of men they elect as sheriff and city commissioners. All of this, of course, has
been said before.
We do not pi'esume to argue the question as to whether or not gambling is
morally good or bad. The fact that a particular law has been enacted and is on
our statute books should require its complete and impartial enforcement by the
agency or officer charged with its enforcement. It should not be within the
discretion of public officials to adopt a "liberal" or a "closed" policy.
Although we recommend that a grand jury be kept in continuous session, it
seems deplorable that the people should have to maintain constant vigilance over
law-enforcement ofhcers in order that the gambling laws, among other laws, be
enforced.
HANDICAPS TO EFFICIENT GRAND JURY PROCEDURE
In the course of our activities ac a grand jury we have been made keenly
aware of the division of responsibilii:y for the enforcement of the criminal laws
in our community. There are the sheriff's department and the different police
departments. There are the county solicitor's otfice and the State attorney's
office. Such division of responsibilities leads readily to excuses for avoidance of
responsibilities ; to a "hands-off" policy of matters which can be claimed to be
within the jurisdiction of another official ; to a synical attitude that "it is not
within the province of my office or department to investigate so and such" ; to a
rendering impotent our grand jury system.
There are some holders of public office who have an idea regarding the grand
jury which is not consistent with the traditional role played by the grand jury.
Tliese officials believe that the grand jury should confine itself to inquiries of
crimes of a capital nature only, for they reason that persons are tried on indict-
738 ORGANIZED CRIME IN INTERSTATE COMMERCE
ments only in capital cases. Although this may relieve the grand jury of the
burden of hearing the numerous other cases involving felonies of lesser degree
than capital, it also can tend to nullify the results of the grand jury's investiga-
tions regarding matters which involve the commission of such other crimes. Any
indictment handed down by the grand jury on such lesser matters will not be
prosecuted by the prosecuting attorney who might have aided the grand jury in
finding such indictment. Instead, as matters now stand, it will go to another
official who will have to issue an information, on which the accused will need to
be tried. If this official does not see fit to issue the information, the grand jury's
worlv will have been for naught. This has happened in the past.
It is some of these lesser crimes which plague our community. Charges of
corruption of our law-enforcement agencies, and charges of malfeasance and
misfeasance of our officeholders arise from time to time. The public officials who
share this philosophy would have us believe that this is no concern of the«grand
jury. They cynically argue that the voters deserve to get the type of pulilic
ollicial they elect, and if they are not satisfied they can vote him out of office in
the next election. Meanwhile, of course, he should be allowed to do as he pleases
at the community's expense and to its great harm. It is the idea of rascals, who
we as voters, sometimes unfortunately and to our sorrow, put into office. Under
the present system the grand jury is hamstrung in its efforts to look into matters
concerning public officials.
We were convened and told that we would be presented with capital cases as
they arose and that we could investigate other matters as we saw fit. In theory
the grand jury is powerful as it is the direct instrument of the citizens. In
actuality tlie power is that of the waterfall. Machinery is needed to direct and
employ the power of the grand jury, as the dynamo is needed for the waterfall.
We feel that there is a necessity to consolidate the duties and responsibilities
for the enforcement and the prosecution of the criminal laws in one office in-
stead of in the two offices of county solicitor and State attorney as at pi-esent.
This single prosecutor should be the one who works with the grand jury and
who should prosecute all of the indictments the grand jury renders, both capital
and otherwise. This prosecutor should be the implement through which the
grand jury conducts its investigation. He should have available a staff of police
investigators wliom he can direct to search for the presence of evidence con-
cerned with the grand jury's deliberations. The grand jury should be able to hire
such special investigators as it deems necessary, they to be paid out of the $30,000
annual fund which the recent statute has provided for the grand jury. It should
not be necessary for a grand jury to do the legwork on investigations, for that
calls for skill and experience, which the ordinary citizen who is called for jui\v
duty does not ordinarily have. And then, of course, we come to the basic thing.
It will be up to the citizens to elect a prosecutor who will be capable, fearless, and
honest.
SUGGESTIONS FOR IMPROVEMENT OF THE GRAND .JURY SYSTEM
This grand jury in common with many of its predecessors experienced some
difficulty in procuring a quorum for our various sessions. As has been the case
with past juries, ours was composed of 18 members, 15 of which constituted a
quorum. This, of course, gave us the usual leeway of three. However, shortly
after we were impaneled, the court permanently excused one of our members
from attendance at all subsequent sessions. This left us with only 17 active
members and due to illnesses and personal emergencies, it was difficult at times
to obtain the necessary 15 in attendance.
This experience points up the appropriateness of increasing the membership of
the grand jury from IS to 23, with retention of the requii'ement that 15 constitute
a quorum as called for in a bill recently enacted by the State legislature. Regard-
less of the fact that this law has been held invalid by the circuit court and a de-
cision thei-eon is now pending before the supreme court, we concur in the basic
thiid^ing which motivated in its enactment.
Numerous grand juries in the past as well as various other groups have long
recommended that changes be made in the method of selection of grand juries.
In this we heartily concur. The present system of selection from the list of
petit jurors drawn f<n- a particular term of court to our mind is woefully inade-
quate. It results in the impanelment of a group of jurors who have no advance
warning that they are to serve as grand jurors and who, as a consequence, ai-e
not as well prepared to discharge their responsibilities as should be desired.
ORGANIZED CRIMEi IN INTERSTATE COMMERCE 739
We feel that the selection system should be chaiiwil ; that iirnud jurors should
serve on a voluntary basis ; that they should submit their name with their qualifi-
cations in an application to the clerk of the circuit court and in their applica-
tion, they should a.ui'ee to serve when called. The jury connnission sliould have
the applicants thorou,uhly investitiated and only those found qualified sliould be
eligible to serve. A list of at least 500 such qualified applicants should l)e main-
tained and ^'rand jurors selected from this list by lot. We also feel that the
selection of names for a firand jury should be made at least 2 weeks prior to pros-
pective date of their impanelment, and that those selected should be notified at
the time of their selection. This would give them time to arrange their personal
affairs so that they could devote more time to their jury duties and also time in
which to acquaint themselves with their duties, I'esponsiliilities, prerogatives,
etc. In connection with the latter point, we strongly recommend that a manual
for grand jurors be i>repared and made availalde to the individual jurors at the
time of their selection, so that when they are impaneled, valuable time will not
be lost while they endeavor to learn some of the details of grand jury procedures.
We feel that we cannot commend the officials in charge of the Miami Police
Department, whether they be the chief of police, the city manager in his capacity
as director of public safety, or the city commission, for permitting bickerings and
feuds to exist in the police department. To ix^rmit the existence of such things
is evidence of a cynical attitude toward enforcement of our laws and indifference
toward the department's morale. It shows that the department is not functioning
as a team, but rather for the personal aggrandizement or enrichment of certain
of its members. Such actions set poor examples for the young men who enter
the police force. The low esteem to which the police department falls in the
minds of the citizens is a poor rewaixl for the honest men who have devoted their
years of service in the department.
We believe that the majority of the police officers in Dade County are honest,
reliable, and energetic but that there are some men who still feel that they should
accept gratuities, although the pay in the various departments is considered good.
It appears that a few have shown evidence that they are living in a manner,
or have purchased property of a value far beyond that which their earnings
would appear could be possible. We believe our successor grand jury might
desire to look into this matter.
Evidence presented indicates that the Miami Police Department is not suffi-
ciently manned, especially during the winter months when the police work is.
the heaviest, and we recommend that this condition be corrected.
It appears that the civil-service system can be an obstacle to efficient law
enforcement in that it has such liberal powers over the hiring and firing of police
officers. The system should be designed to protect career employees but not
to act as a cloak to hide behind for those subject to punishment and discharge
because of misfeasance and neglect of duty.
The sheriff's oflice is to be censured on its laxity in locating, or rather failing
to locate, all the persons who were to make up the panel from which this grand
jury was drawn. We believe that too large a percentage of subpenas were
unserved.
We feel that light sentences and fines are not conducive to deterring crime.
It is discouraging to good police work when offenders are repeatedly released
with a minimum of punishment.
ACKNOWLEDGMENTS
We appreciate the strong charge to the grand jury by .Judge Stanley Milledge
and we regret that subsequent happenings blocked the complete fulfillment of
that charge. We wish to thank Judge Milledge for his unsparing time and
advice which convinced us of his sincerity in the public interest.
The State attorney's office handled the various cases presented to this grand
jury in a very efficient manner. We acknowledge with thanks the assistance
and legal advice extended by the State attorney, Hon. Glenn C. Mincer, and his
assistants, .Tohn W . Prunty and Harvie S. DuVal.
We wish to commend the police officers who appeared before this grand jury
for the efficient manner in which they handled their work in each case presented
by the State.
The cooperation received from the press was very gratifying and we extend our
thanks for the assistance we received from all of the newspapers.
740
ORGANIZED CRIMEl IN INTERSTATE COMMERCE
The Crime Commission of Greater Miami extended full cooperation and valu-
able assistance. We hope that this organization will continue its work in help-
ing to protect Dade County from the evil forces that would weaken and degrade
our community.
We feel indebted to the men and women who appeared before us as witnesses
for their time and worthy testimony.
It now appears that the spring term of the Circuit Coui-t of the Eleventh Judi-
cial Circuit will terminate on Monday at midnight, the 7th day of November
1949, and as there is no reasonable expectation of the supreme court rendering
a decision prior to that date, this grand jury respectfully requests this court
to discharge or recess this grand jury, with an appropriate order as the court
may see fit and be advised.
Respectfully submitted.
Dade County Grand Jury, Spring Term, 1949,
By Walter E, Morris, Foreman.
T. Thurston Rittek, Clerk.
Dated the 7th day of November, A. D., 1949.
Exhibit No. 107
[From the Miami News, July 11, 1950]
County Delays Elisor Conference
County authorities have postponed until Thursday their conference on future
action in the cases of 15 men arrested in an elisor raid on the Surfside Hotel at
Miami Beach a year ago last April.
Criminal Court Judge Ben C. Willard said he will wait until County Solicitor
Robert R. Taylor gets back to town before calling the meeting with Taylor's
assistant, Michael Zarowny, and attorneys for the S. & G. syndicate. The latter
have moved to suppress evidence in the case on grounds that an elisor warrant
is illegal. Action will be planned to get a Florida Supreme Court decision on
this question as soon as possible.
If the appointment of an elisor — a private citizen vested with authority by the
court — is held legal, prosecution of the 15 defendants will go forward, the county
solicitor's office has explained. Judge Willard has indicated he may order the
evidence suppressed so that the case will come before the supreme court at once.
Exhibit No. 108
G-^M B LI K Gr
BROWARD COUNTY
LOUISIANA MINT CO.
JAKElANSKY.NYc
PHILKASTEL.Ntwoiti£*Ni
FRANK COSIELLO.N.Yc.
DADE COUNTY
JAKELANSKY....N.Y.C.
MEYER LANSKY....N,Y.c.
JOSEPH A.DOTO-y<j/></^*/; NYC.
FRANK ERICKSON...N.Y.C.
BERT BRIGGS....N.YC.
CLAUDE LITTER AL "°;':r°°
SAMUEL L.BRATT..CHICA&0
HONEY PIMA HOTEL
1948
VIOfFORD HOTEL
|9-*l - 1946
WILLIAM &BI5CH0fP<?/WK^^-«*/r
DETROIT
mm MAssEi
PALM BEACH COUNTY
BOULEVARD HOHL
1946 I950
BOCA RATON CLUB
FRANK ERICKSON nyc.
JOHNO'ROURKE paimbmch
OAOElCOUNTY
I
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MIAMI BEACH
jack frieownder
joseph'mass'ei
WIlllAM BiSCHOfF
BfNNIF KAYE
NYC
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JALKFRIfDLANDFR
NEWARK
SAMUEL PCOHEN
MIAMI 6SACK
HERBERT MAtJHEIM
DETROIT
SAMw^/^rMILlfR
ClfVfLAND
ORGANIZED CRIMEi IN INTERSTATE COjVUVIERCE
741
Exhibit No. 109
WIRE SERYICE
icxhj^/t- /Vok
742
ORGANIZED CRIMEl IN INTERSTATE COMMERCE
Exhibit No. 110
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ORGATSriZED CRIMEi IN INTERSTATE COMMERCE 743
Exhibit No. 112
Bureau of Police,
Philadelphia, I'a., July 19, 19J,9.
Mr. Daniel P. Sullivan,
Crime Comiaission of Greater Miami, Miami, Fla.
Dear Mr. Sullivan : Your letter of June 17, 1949, with reference to Willie
Weisberg and Cappie Hoffman of this city, was duly received. I have deferred
answering it in oriler to compile detailed information concerning these individ-
uals and their associates.
Willie Weisberg and Cappie Hoffman are the chief lieutenants of the notorious
Harry Stromberg, alias Nig Itosen, a native of New York City, who came to
I'liihulelphia during the proliibition era and establislied himself here as the
kingpin of gangsters, bootleggers, and rum runners. He gathered about him a mob
of killers, sluggers, and strong-arm men. Ilosen ruled with an iron hand, and
those who opposed him were eitlier killed or otherwise removed from circulation.
After being driven from Philadelphia, Rosen made his headquarters in Upper
Darby, Pa., just beyond the Philadelphia city line, and operated tliere until the
late tliirties. He then returned to New York City, but retained control of the local
mob, and personally directed its activities through Willie Weisberg.
Rosen lias connections with the underworld through the entire Nation. So
far as the local mob is concerned, he is. their |iudisputed leader, and is com-
monly known as The Mahoff. Among his followers his word is law, and an
unfortunate accident is likely to befall any member who flaunts his authority.
Rosen's interests are many and varied. For years, he operated the Dearest
Miss Dress Co., 254 West Thirty -fifth Street, New York City, in connection with
which he operated a number of dress factories in the eastern part of the country.
He is also believed to exercise some power among union and labor circles con-
nected with the garment industry.
In the mid-thirties, Rosen, by coercion, seized control of the Maryland Athletic
Club of Bladensburg Road and District Line, just outside of Washington, D. C,
which is one of the oldest and largest gambling houses in the United States. Its
owner, one James LaFontaine, known as "the Frenchman," is an elderly man, who
has since been relegated to the role of minor partner. Rosen is fronted for, in this
establishment, by one Herman, alias "Mugsy," Taylor, local figlit promoter, who
has run gambling houses all his life.
Nig Rosen controls a large part of gambling, numbers, lotteries, and horse and
sports betting in the Philadelphia area. We have known that he has for many
years been closely associated with Meyer Lansk,v, of New York City, and he is
believed also to have a piece of some of the Lansky interests in the vicinity of
Miami Beach, Fla., and in the West, particularly Las Vegas, Nev. There is a
persistent rumor, which is borne out by some known facts, that the late "Bugsy"
Siegel was executed by a local henchman of Rosen's, acting on behalf of the
Rosen-Lansky interests.
It is well known to us that Nig Rosen connects closely witli the Capone mob
of Chicago and the various major mobs of New York City, including the Fischetti,
Long Zwillman gangs.
You are correct in your understanding that Nig Rosen is not permitted in
Philadelphia. However, as we have already stated, he still exercises the control
of his mob by long distance through Willie Weisberg.
We have information that on July 6, 1948, Sylvia Stromberg, wife of Nig Rosen,
purcliased a property at 42.36 Pinetree Drive, Miami Beach, Fla., at which address
she had apparently resided since November 2, 1947, and possibly prior thereto.
It is our luiderstanding that this property is the home of Nig Rosen.
It is also our understanding that during the winter season there is a great
influx of Philadelphia gangsters and racketeers in the Miami and Miami Beach
areas. Also, that Willie Weisberg and Cappie Hoffman, acting on behalf of Nig
Rosen, have backed gambling there. During the summer season this combine
operates in a similar fashion at Atlantic City, N. J. We have been informed that
the headquarters and usual meeting place of the various members of the mob
when in Miami Beach are the Sands and Grand Hotels, of which Benny Streetsky
and Davey Glass, both Philadelphians, are or were proprietors.
In order that you may know the various members of the Nig Rosen mob and
their background, we have compiled and send to you herewith copy of the crim-
inal record of its most prominent members, including the leader. Nig Rosen. We
are also sending you photographs of each of the individuals whose records we are
6895S — 50 — i)t. 1 48
744 ORGANIZED CRIMEI IN INTERSTATE COMMERCE
supplying, together with a separate sheet in which we briefly outline the nature
of the activities of each.
Please call upon me for any information or cooperation which will assist you
in dealing with these mobsters. I am personally interested in cooperating with
any law-enforcement agency in the curbing of this nefarious group.
Very truly yours,
George F. Richardson,
Assistant Siiperintendent, Commanding Detective Division, Department
of Public Safety, Bureau of Police.
DATA CONCERNING NIG ROSEN MOB
1. Harry Stromberg, alias Nig Rosen : See letter above.
2. Willie Weisberg : Chief lieutenant of Nig Rosen. Resident of Philadelphia
and overseer of the mob.
3. Samuel "Cappie" Hoffman : Willie Weisberg's bodyguard and chief "en-
foi'cer." This man is a killer and strong-arm man.
4. Orving Greenberg : Resident of Philadelphia. Former bootlegger. Presently
operator of horse and number banks. He is known to participate in the gambling
set-up with Willie Weisberg at Miami Beach, Fla.
5. Max Kothman, alias "Chinkie" : Killer and strong-arm man, also "enforcer"
for the mob. He is rumored tg be the killer of "Bugsy" Siegal, and spent some
time in Las Vegas, Nev., prior to the killing, and left shortly thereafter. Resides
in Upper Darby, Pa., outside of the Philadelphia city limits.
6. Joseph Hei-man, alias Herman Kriss, alias Little Krissy : Killer and strong-
arm man for the mob. Resides in or near Chester, Pa., where lie is employed
in tlie Rosen-controlled gambling set-up. Also, drug addict.
7. The Matteo brothers, alias Mendel : These three individuals are among the
most dangerous gangsters of Philadelphia ; although part of the original Nig
Rosen mob with which they are still connected they also tie in with the New
Jersey Italian mob, headed by Marco Reginelli, alias "The Little Guy," who is
absolute czar of the Italians in the south Jersey and Philadelphia areas. In
Philadelphia proper, however, the INIatteos control the strongest Italian mob.
They have almost absolute control of the alcohol racket. They also have a very
large interest in gambling and numbers. On occasion in the past, they have
been conspicuous by reason of their interest in vice and prostitution. They
have also been known to have handled narcotics. There are a number of brothers,
but the most important of them are Frankie, Nickie, and Salvatore, alias O'ohn
Lewis.
8. Tony Narcise : Killer and "enforcer" for the mob. Drug addict. Lately
engaged in the operation of gambling houses outside of Philadelphia.
9. Isreal Halpern, alias Dan Shunkus : Old-time pickpocket, drug addict, and
procurer of drugs. Lately engaged in gambling and numbers.
10. Abe Glassman : Largest bookmaker in Philadelphia on horse races, baseball,
and sports. He is known to be very closely associated with Nig Rosen and Willie
Weisberg, and it is believed that within the past few years, Rosen "muscled"' in
on the Glassman business.
11. Harry Provan : Old-time pickpocket, drug addict, dope peddler. Lately
engaged in bookmaking and numbers lottery.
12. Samuel Lit : Gambler, who on occasions has operated some of the largest
horse, baseball, and sports betting set-ups in Philadelphia.
13. Nathan Stromberg, alias Nussie Rosen : Brother of Nig Rosen. Resident of
Chester, Pa., where he manages the Rosen gambling set-up.
14. Joseph Kutcher, alias Billy Devine: This man was a drug addict and
peddler, who in late years had been an errand boy for the mob. However, he
died and was buried during the week of July 4, 1949.
15. Jack Newman: Slugger and strong-arm man for the mob, who for the
past few years has resided in New York City, where he is said to have control
of large pinl)all concessions in the garment-working area.
16. Moe Newman: Former killer and strong-arm man for the mob. This
man, for the past few years, has also made his home in New York City, but is
still connected with the Rosen mob. Both Newmans are brothers of Jeff Newman,
who is serving a life sentence in Stillwater Penitentiary, with Al Silverberg,
for a mob murder. Jeff Newman and Al Silverberg during the prohibition
era were the chief executioners of the Rosen mob.
ORGA]^^ZED CRIMEi IN INTERSTATE COMMERCE 745
17. Harry Siegel, alias Little Sliooey : Local gambler, currently employed by
Abe Glassman.
IS. Max Segal, alias Big Shooey : Former strong-arm man and killer for the
mob, who in late years has been connected with the numbers racket in Phila-
delphia.
19. Abe Rothman : Brother of Max Rothman. Local gambler and member
of the Rosen mob.
20. Samuel Schlenker : Long-time member of the mob. Formerly operated
house of prostitution. In later years has resided in Chester, Pa., where he
operates the Sun Hotel which is the headquarters and chief meeting place of
the Rosen mob in Philadelphia and the area. This individual is commonly
referred to as "The Colonel."
21. Raymond J. Boyne, alias Johnnie Murphy : Formerly a resident of Pliila-
delphia suburbs. Formerly a killer and strong-arm man for the mob in Phila-
delphia. Not known whether this man is still active.
22. Frank Palermo, alias Blinkey : Fight promoter. Runs gambling and num-
bers lottery. Manages Ike Williams, lightweight champion.
746 ORGANIZED CRIME IN INTERSTATE COMMERCE
Exhibit No. 113
ORGANIZED CRIMEl IIST liSTTERSTATE COMMERCE
Exhibit No. 113 — .Continued
747
748 ORGANIZED CRIME IN INTERSTATE COMMERCE
Exhibit No. 114
ORGA-N-IZED CRIMEI IX INTERSTATE COMMERCE
Exhibit No. 114 — Continued
749
^ti.
750 ORGANIZED CRIMEl IN INTERSTATE COMMERCE
Exhibit No. 120
June 15, 1950.
Hon. Robert R. Taylor,
County Solicitor, Dade Count]/ Courthouse, Miami, Fla.
Dear Mr. Taylor: Over the years you have consistently been urged by nu-
merous citizens and civic groups, as well as by the newspapers and by some
grand juries, to take vigorous action to stem the growing tide of criminal infiltra-
tion and rackets into this area. On numerous occasions you have been severely
criticized by these same well-intentioned individuals, groups, and institutions.
From my observation you have invariably parried with some stock phrases
instead of giving the public action out of your office. I recall that your answers
have been that your office was doing a good job, that the criminal and racket
activities were exaggerated, that those who were critical of you were seeking
publicity, that if your critics would conduct their own investigations and issue
warrants for the violators of the law, you would be glad to pursue prosecution,
and that you have no investigators in your office to do the investigative work to
build up a case.
When I called upon you to take action in connection with the secret meetings
of the city council in the city of Miami Beach, you assured me that you would
prosecute the matter vigorously in the event that all of the required evidence
was presented to you. I meticulously established a case for you with dates,
times, names, and places, together with witnesses. After considerable delay
you told me that you had discussed the matter with some of the proposed de-
fendants and that you were satisfied that there was no violation of the Florida
statute.
In a proceeding brought by me to determine the legality of the secret meetings
in the face of the Florida statute, the Honorable Charles A. Carroll, one of our
circuit judges, stated :
"In fact, it is somewhat surprising to me that this matter should even be
submitted to the court for an interpretation, because all a court needs to do in
order to interpret this statute is to quote and refer to the fact that it says that all
meetings of the city council shall be held open to the public."
Reams of evidence have been made available to you through private citizens,
through groups and organizations, and through the newspapers. Many hun-
dreds of pages of newspapers have listed, day after day, the names of known
gamblers and racketeers in this area and have shown pictures of their gambling
casinos together with the addresses of these institutions that operated with
obvious immunity from prosecution. Yet, over the years no action has ever
been taken by you. But, in no instance, in my opinion, has the matter been
brouglit home more forcefully than in the past several weeks through the expose
revealed in the tentative reports of Senator Kefauver's committee. You cannot
deny that the information revealed in the Senate inquiry in Washington, as well
as the reports released by the Kefauver committee and by the office of the New
York district attorney, gives your office ample basis for a vigorous investigation
and prosecution of the big-time rackets that have concentrated in this area.
It is significant to note that the ink was hardly dry on the report of Frank
Erickson's testimony before the Senate committee when the office of the New
York district attorney had taken possession of vital and important records which
revealed the tie-up of Erickson and other racketeers in this area. It is even
more significant that the New York district attorney's office, within a matter of
weeks, has been able to set Erickson's trial date for no later than this Monday.
In spite of all this evidence, what witnesses has your office subpenaed and
what papers has your office sought to procure from the local racketeer syndi-
cates in an effort to wipe out criminal graft and corruption in pour jurisdiction?
From my observation your office has continued to plod along as though nothing
has happened.
The newspapers have made it clear that the Internal Revenue Department is
ready to take criminal action against tlie S. & G. Syndicate. One of the charges
is that the returns failed to show income apparently received for the payment of
bribes to public officials. The very fact that the racketeers have been permitted
to openly ply their activities over the years was clear enough indication that
some deal had been made with some public officials. This latest revelation indi-
cates clearly that apparently bribes were paid to somebody. What more evidence
does your office need to commence an investigation?
If you require detailed information on how to proceed, I recommend that you
subpena all of the bookmakers wlio have ever been convicted in the municipal
ORGANIZED CRIMEI IN INTERiSTATE COMMERCE
751
court in the city of Miami Beach, as well as in the municipal courts of other
cities throughout the area, and pursue a searching inquiry into their activities,
tlieir payments, their receipts, and their bosses. The names and addresses of
these men are available to you through each of the police departments and
through your power as county solicitor you can procure that information with
dispatch. I think that such an inquiry alone would give your office sufficient
information to prosecute some of the big-time racketeers in this area. If you
find that insuflScient, you might try inquiring of the members of the local syndi-
cates themselves concerning bribe money they paid. When you learn from them
to whom the money was paid, you can commence prosecution of the public officials
who received the money. I anticipate your response that if you incpiire from
tlie big-time racketeers, on subpena from your office, their testimony will grant
them imnmnity from prosecution themselves. In the first place, sucli immunity
would be only with regard to the particular crime involved, that of the payment
of the bribes. They would not be immune from prosecution for their consistent
violation of the laws over the years. And secondly, is it better to grant inunu-
nity to some racketeers in order to destroy the existence of the rackets or to
pursue the course you have taken up to now to permit the rackets to continue to
operate.
I further recommend that you might possibly p;-ocure some valuable informa-
tion from your brother-in-law, Ben Shepard, who is the city attorney in the city
of Miami Beach. He has apparently had considerable dealings with" the S. & G.
Syndidate members and might be able to give your office a great deal of valuable
information concerning tlieir operations. To illustrate what I have reference
to, I quote from a portion of an instrument filed by me on May 30, 1947, in a
cause pending in the circuit court of Dade County, Fla., in Chancery No. 96153F.
It should be borne in mind, in examining the quotation, that it is customaiT
practice, as you well know, for attorneys in the representation of clients pur-
chasing real estate, to have the deeds returned from the recording department
to their own offices.
The excerpt from the pleading referred to reads as follows :
"It is significant to note that the fee-simple titles to many of the lots in that
are vested in the names of members of the syndicate hereinabove referred to and
are vested in the names of persons who in some way are directly associated with
the city hall in Miami Beach, Fla. Those fee-simple ownerships are set forth in
the following list together with other significant information showing to whom
the original deeds were returned and to whom tax bills are sent :
AMENDED PLAT, FIRST OCEAN FRONT SUBDIVISION
Lot No.
Fee-simple owner
Deed retui'ned to-
Tax bills sent to —
4
5
13, NM 12,
14
23
24
243
337
Virginia Leavitt and Samuel
Friedman.
Harold Sal vey
Samuel P. Cohen and Charles
Friedman.
Ocean Front Apartments, Inc
Harold Salvey
Charles Friedman and Jules
Leavitt.
Virginia Leavitt
Jules Leavitt and Charles Fried-
man.
Ben Shepard.
do
Samuel Cohen,
Sam Kay.
c/o
J. N. Morris -
Copeland, Therrel &
Baisden.
do
Virginia Leavitt .
Ben Shepard
Virginia Leavitt and
Samuel Friedman.
Harold Salvey.
Samuel P. Cohen and
Charles Friedman,
c/o Sam Kay.
Ocean Front Apart-
ments, Inc., c/o Sam
Kay.
Harold Salvey.
Charles Friedman and
Jules Leavitt.
Virginia Leavitt.
Jules Leavitt and
Charles Friedman.
AMENDED PLAT, SECOND OCEAN FRONT SUBDIVISION
1,2
4, 5, and 6-
William Burbridge.
Ray Corp
Copeland, Therrell &
Baisden.
do
Ben Shepard.
William Burbridge.
"It is significant to note that in the case of the members of the syndicate the
deeds in some instances were returned to Ben Shepard ; that Ben Shepard is the
city attorney for the city of Miami Beach and is the attorney of record for the
city of Miami Beach, the defendant in this cause of action. It is further sig-
nificant to observe tliat Ray Corp., hereinabove mentioned, in its last report filed
752 ORGANIZED CRIME IN INTERSTATE COMMERCE
with the secretary of state of the State of Florida, designated as its place of
business or domicile for service of process 1130 Washington Avenue, Miami
Beach, Fla., which is the city hall at Miami Beach, Fla. ; that the officers of the
corijoration in the said last report were shown as Farber Burbridge, president ;
William Burbridge, secretary and treasurer, both care of Ben Shepard, attorney.
City Hall, Miami Beach, Fla. ; and the directors of the corporation were shown
as Farber Burbridge, William Burbridge, and Ben Shepard, attorney, 1130
Washington Avenue, City Hall, Miami Beach 39, Fla.; that the said William
Burbridge named as an officer and director of the said corporation is a member
of the Miami Beach City Council. With respect to lots 13 and the north one-
half of lot 12 of Amended Plat, First Ocean Front Subdivision, aforesaid, the
fee-simple owners, Sam Cohen and Charles Friedman, it should be noted that
the tax bills are sent to the said fee-simple owners, care of S. Kay, 420 Lincoln
Road, Miami Beach 39, Fla. ; that the said S. Kay owns considerable property,
as shown hereinabove, in the name of Sam Kay and is an officer and director
in Ocean Front Apartments, Inc., a Florida corporation, which latter corpora-
tion is fee-simple title holder of certain lots as shown hereinabove. Virginia
Leavitt is the wife of Jules Leavitt "
I am sure that my critical opinion of your office will not arouse in you any
desire to take an interest, in jny behalf and in behalf of the people of the city
of Miami Beach, in the recall proceedings that were instituted against me.
However, on the outside chance that you might be interested, I should like to
call to your attention the fact that I already have evidence that the recall move-
ment was steeped in fraud and corruption, that it was apparently well financed
by racketeers and selfish interests who gained financial benefits from the racket
operations. I also have ample evidence of illegal registrations solely for the pur-
pose of procuring additional signatures for the recall petitions. The very fact
that a tremendous percentage of the persons who signed the recall registei'ed im-
mediately prior to signing same for the first time in the city of Miami Beach calls
for an investigation by your office. I have in my possession affidavits showing
that signatures were procured by fraud, by misrepresentation, by threats of
bodily harm, and by the payment of money in consideration for the signature.
You can appreciate the fact that the investigation conducted by me was a
difficult one because I do not practice criminal law, I am not acquainted with
investigative procedures, I have a limited time at my disposal, and I have no
subpena powers. The great numl)er of persons with criminal records who were
associated with the recall movement is reason enough to call for a public investi-
gation. Where, as In this matter, it appears that a major vote fraud is involved,
it becomes incinnl)ent for your office to take action.
I am fully aware that you can complain about lack of cooperation from local
police departments and from the sheriff's office. You also are in a position to
complain that you do not have investigators to act in the capacity of detectives.
However, from a law-enforcement point of view, yours is, without question, the
most powerful law-enforcement agency in the State. Even withotit conducting
on-the-scene investigations, through your subpena power you are in a position
to conduct investigations and to delve into the intricacies of the racket operations
without leaving your office. You are a one-man grand jury with all of the
powers that a grand jury has, plus many advantages that they do not have. The
grand jury cannot be substituted for your office because they are made up of
businessmen who have outside problems, because they are limited in their dail.v
activities in their capacity as grand jurors, and because their term in office
is extremely limited. You have every opportunity, especially at this time, to
prove your worth as a law-enforcement officer. It would be a shame if the
job had to be done by the Federal Government.
If the latest policy of the Governor of our great State is the proper method
of procuring law enforcement, then his "bank nite" procedure should be substi-
tuted in its entirety for all of our law-enforcement officials. It would save the
State of Florida a great deal of money and might prove to be more effective
if law enforcement were completely taken over by private citizens on a give-
away-program policy.
I am sending a copy of this letter to the Governor's office in the hopes that in
the event your office takes no action in connection with the local racketeers, the
Governor might possibly appoint a group of special prosecutors to do the job
for us in this area.
If your office decides to take action, you may be assured of my cooperation, as
well as the cooperation of all departments in the government of the city of
Miami Beach.
Very truly yours,
Melvin J. Richard.
ORGANIZED CRIMEI IX IXTERSTATE COIMJVIERCE
ExiTTiirx No. 121
mmmmm^^mmmmmmmmmmm
mmmmimmm»*mmmmmmm^smimmmmmm
753
iBIIMI-
■§^l^mmm^'
Exhibit No. 122
754 ORGANIZED CRIME IN INTERSTATE COMMERCE
Exhibit No. 123
Exhibit No. 124
ORGA]SnZED CRIMEI IN INrTERSTATE COMMERCE 755
Exhibit No. 124 — Continued
Exhibit No. 127
Grand Jury Report, Winter Term, A. D. 1948, for Dade County, Fla.
(Filed May 10, 1948)
IN THE CIRCUIT COURT OF THE ELEVENTH JUDICIAL CIRCUIT OF FLORIDA IN AND FOR
THE COUNTY OF DADE, WINTER TERM, A. D. 19 48
Thomas B. Hamilton, Foreman ; Arthur M. Collot, Vice Foreman ; Odes E. Hall,
Clerk ; T. E. Norman ; Wm. J. B. EUenburg ; M. D. Galloway, Jr. ; Raymond H.
Bauer ; Kenath M. Fether ; Rudolph C. Gehrken ; Everett G. Carroll ; Arthur P.
Ball ; Dave Emmer ; Albert S. Blitch ; James L. Blair ; Loren R. Goddard ;
Arthur L. Adair ; E. D. Gilliam ; Sidney L. Belcher
Glenn C. Mincer, State Attorney ; John W. Prunty, Assistant State Attorney ;
W. Curry Harris, Assistant State Attorney
Final Report of the Grand Jury
To the Honorable Judges of the Above Styled Court:
We, the grand jury, duly impaneled and sworn to inquire in and for the body
of the county of Dade, for the winter term A. D. 1948 of the Circuit Court of
the Eleventh Judicial Circuit of Florida, respectfully report to the court that
we were convened on the 10th day of February A. D. 1948. Thomas B. Hamilton
was appointed foreman by the court ; Arthur Collot was appointed vice fore-
man. O. E. Hall was designated as clerk. Forthwith thereafter we recessed
and reconvened at the hour of 10 a. m. on the 17th day of February 1948.
capital oases
We have considered a total of 11 capital cases and have returned the following
indictments to wit :
Murder in the ttrst degree 1
Murder in the second degree 1
Manslaughter , 1
Rape 4
Assault with intent to commit rape 1
No true bills 3
In the course of our deliberations a total of 68 witnesses have been heard. We
have filed four preliminary and one supplemental report.
756 ORGANIZED CRIMEi IX INTERSTATE COMMERCE
In relation to the recommendations that this grand jury is making, we find
that a number of these recommendations have been made from time to time by
past grand juries with no action ever being talven on these recommendations.
We strongly urge that the report of grand juries be given more serious con-
sideration by public ofBcials than heretofore. It is unfair to expect 18 citizens
to spend their time and efforts at great expense to themselves, by serving on
grand juries, assembling information, and recommending corrective action, and
then discover that such recommendations- are completely ignored. Continuity
of plan and effort is sorely needed.
This grand jury therefore recommends that immediately after a new grand
jury disposes of its capital crime calendar, and before any investigations are
made, it analyze and study the report of the previous grand jury and call before
it all public ofBcials whose responsibility it would be to follow up on the previous
grand jury's recommendations ; and there and then get from these public ofBcials
an accounting of what action had been taken under recommendations made by
the prior grand jury.
It is very difficult for members of the grand jury, no matter how sincere that
they may be in their efforts, to assemble facts and information that are necessary
to determine whether or not the laws are being properly enforced by law enforce-
ment officials. This grand jury keenly felt the futility of its efforts because of
the deficiency of the machinery for investigations under certain conditions.
Let it be remembered that grand jurors are business or professional men who
do not know the rules of legal evidence and do not know enough about criminal
laws.
We recommend that our State representatives and State senator seek new
legislation looking toward a change or changes in the State laws regarding
grand juries. Such changes to be as follows :
1. Authority vested in the grand jury to employ competent and specialized
legal advice.
2. Authority by the grand jury to employ competent and expert investigators
and stenographic assistance.
3. To empower either the Governor of the State or the circuit court judge who
originally impaneled the grand jury, to extend the life of such grand jury beyond
its term, and for an indefinite period ; such an extension to be granted only upon
the request and petition of the grand jury itself.
These provisions, if enacted into law\ would do away with the uncertainty
and the ineffectiveness with which grand juries proceed with investigations
during the closing period of their term. They would then be empowered to
follow through to a successful conclusion any action they undertook, and would
obviate the necessity of following grand juries to delve into the same matter.
As has been recommended time and again by other grand juries, proper laws
should be passed by the State legislature outlawing the use of telephone, tele-
graph, and radio services, or other methods of communications, for the dis-
semination of racing information for illegal operations.
It has long been a known fact that lawmaking bodies cannot successfully
legislate morals. The best example of this statement was the late lamented
Prohibition Act. Impossibility of enforcement led to a general breakdown in
all law enforcement. We are faced today with the same situation on the
question of gambling. This grand jury has pondered the question thoroughly and
deeply ; it lias gone through every phase of gamltling activities, from bookmaking
to mobster infiltration. The consensus of opinion of the grand jurors has boiled
down to the fact that inasmuch as we find general laxity in the enforcement of
the gambling laws, and that inasmuch as pari-mutuel betting has been legalized
by the State, and that furthermore, if all who desire to bet, were compelled to
attend the various pari-mutuel establishments, they could not be accommodated,
we believe that a solution would be to legalize bookmaking where bets may
be made and coursed through whatever pari-mutuel establishment was oper-
ating at the time, thereby gaining for the State the revenue it now loses through
sneak bookmaking.
Such legalized bookmaking stations should be licensed and controlled by the
State, county, or municipal governments, whichever the legislators, in their
judgment, may deem best. Policing of such a set-up should be put into the
hands of the State racing commission, and the funds of such policing should be
derived from the revenue received by the State racing commission.
It has come to our attention that through devious and various means and
subterfuges, telephones have boon diverted from legal use to bookie operation.
At our instigation the telephone company investigated 57 bookie locations having
ORGANIZED CRIMEI IN INTERSTATE COMMERCE 757
Western Union telegraphic sporting wire service. Although it was difficult to
prove the illegal use in some cases, in other cases, wide open house hooking
was being carried on and from the result of this investigation, 48 telephones
were removed and released for use by legitimate subscribers, and 22 Western
Union wire services were discontinued. Continual following up of these methods
of investigation by other grand juries or other organized effort, would release
many phones for legitimate use. From testimony given before this grand
jury by the Western Union Telegraph Co. it appears that race results are dis-
seminated over a Western Union loop, throughout Dade County, originating from
headquarters in Broward County. We emphasize the seriousness of the present
situation, that in spite of our efforts the book makers have continued to operate.
Hotel managements are allowing booking operations and actually becoming
a partner by leasing booking concessions under the subterfuge of calling them
cigar stands, etc., leased at enormous rentals. This violates the State hotel
laws and the liotel's license should be revoked by the State hotel conmiissiou.
The management should be made a defendant along with any prosecution of
the persons actually operating the "book" in rental locations at these hotels.
We believe that changes should be made in the method of selecting men for
grand juries. We suggest that a separate list be maintained, which list would
be composed of citizens of the proper qualifications to serve on grand juries.
We also recommend that it would be advisable to have some alternates in addi-
tion to the 18 men drawn for grand jury service, as in a great number of instances
the operation of grand juries has been hindered by sickness and other absences.
We also believe it would be advisable to convene a grand jury at the beginning
of each term of the circuit court and this grand jury should serve until that
particular term of court expires.
It has been our experience in this grand jury's tenure of service that as long
as a grand jury remains in session, the commercial gamblers and certain otlier
law violators do not operate as much as when no grand jury is in session. A
grand jury in session is a definite deterrent to crime.
It would also be very helpful that some manual of information be published
and presented to each grand juror after it convenes, so that its members would
be familiar with the duties and powers that they have. We have found that most
grand juries are composed of men who have not had previous grand jury expe-
rience and this manual would be very helpful to them.
The Chicago Crime Commission and the Grand Jury Association of New York
published such a helpful booklet. We recommend that either the State attorney
or the law enforcement institute of Dade County or the Dade County grand
jury association prepare such a booklet.
We strongly endorse the formation and the objectives of the law enforcement
institute of ufade County, and i-ecommend that all citizens of Dade County, civic
clubs, and business firms, actively support this organization, as we believe that
if the public will support this institution financially and otherwise, it will be
the means of assembling information which will be most helpful to future gi-and
juries. It will also be one of the means of continuing the efforts of the grand
jury after it has been discharged.
The law enforcement institute of Dade County is a heartening and wholesome
innovation in this community. This grand jury being familiar with its forma-
tion, aims, and objectives, we urge all citizens and groups who want better law
enforcement and improved civic conditions in general to join the institute at once.
We also recommend that subpenas issued for witnesses to appear before a
grand jury be kept secret, particularly in cases where laxity in the enforcement
of laws is concerned. It has come to our attention that public knowledge has
been obtained concerning witnesses who are to appear before a grand jury, as
it seems very easy to determine when these subpenas are issued and for whom
they are issued.
There is not sufficient time in the term of grand juries to go into more than
one or two matters that need investigation. This grand jury has concentrated
principally on the wire service of bookmaking operations that have made pos-
sible organized gangs to control this illegal operation with great financial return
to them.
It is the fear of tliis grand jury that on account of this illegal operation, these
gangs will have unlimited resources which eventually will make it possible for
them to break down law enforcement progressively and more or less control the
operation of our government at the expense of a vast majority of the people in
this county.
758 ORGANIZED CRIMEl IN INTERSTATE COMIVrERCE
We recommend that the Governor should use his power to remove any public
official from office, when it is brought to his attention that laws are being indis-
criminately violated and not enforced.
In our investigation of illegal bookmaking, we had occasion to call before us
officials of various communication services. At this point the grand jury pub-
licly expresses its appreciation and gratitude to the Southern Bell Telephone &
Telegraph Co. through its general manager, Mr. C. J. Tucker, Jr., who gave
unstintingly of his time and efforts and whose cooperation we laud. The South-
ern Bell Telephone & Telegraph Co. was furnished a list of suspected book-
making establishments which had Western Union wire service. It must be ex-
plained here that Western Union wire service is furnished either by direct wires
of their own, or through leased wires of the telephone company. Under Mr.
Tucker's direction and instructions, each of these places was visited. It must
be borne in mind that under our present State laws, the telephone company is
powerless to remove its instruments even though they are fully aware of this
illegal use. However, the telephone company did remove 48 instruments, not
because of their being used illegally, but because the subscriber had violated some
rule or regulation of the telephone company, such 'as moving the instrument from
its original location, or attaching to the instrument unauthorized extensions.
They had to resort to these means because State laws prohibited them from
discontinuing services to a known bookmaking establishment.
Unfortunately, our commendation and laudation cannot be extended to the
Western Union Telegraph Co. The sum and substance of their testimony led
to the conclusion that they had no desire whatsoever to assist the decent, law-
abiding citizenry of Dade County in their efforts to clear up a bad mess. The
Western Union Telegraph Co. hid behind the provisions of the State law, which
clears them of responsibility of the use to which their installations are put.
Mr. Nowell, their general manager, when asked a direct question, if he personally
witnessed bookmaking activities at an establishment where his service was
supplied, would he discontinue such service. His answer was '"No." The
Western Union Telegraph Co. even refused to remove installations after they
had been tampered with.
The Southern Bell Telephone & Telegraph Co. has unjustly and unfairly been
criticized in our local press. The Western Union Telegraph Co. has barely been
mentioned in this connection.
We commend the Southern Bell Telephone & Telegraph Co. and its manager,
Mr. C. J. Tucker, Jr., for the ready cooperation and assistance given this grand
jury.
We quote from Mr. Tucker before this grand jury :
"As we have said before, we are not going to in.stall any telephones at any
locations for anyone if there is any evidence that the telephones will be used
illegally. We are not able to control the uses made of all telephone installa-
tions. AVe feel this responsibility should be placed on the properly elected or
appointed law officials. We are willing to cooperate in any way possible and
certainly do not condone the practice of any of our telephones being used for
illegal purposes. For us to attempt to police the use of all telephones in Dade
County would be a tremendous undertaking and an almost impossible task.
As a public utility company with limited manpower, we are not equipped for
such work and again feel that it is not our responsibility. There is no reason
why bookmaking in Dade County and the various municipalities could not be
stopped by proper law enforcement."
We believe that it would be advisable for future grand juries to examine
carefully into the operation of bolita in this area. In our limited time it was
imposisble to go into an investigation of this, but from what we have learned
it appears that this is a vicious and widespread racket with serious complications,
which should be curbed.
This grand jury has made an investigation of the city and county jails. We
fomid the city jail in very good condition and wish to commend Captain Mathis
for the good work that he has done.
The plumbing in the city jail was in somewhat bad condition, but we are
advised that the city leases these facilities from Dade County, and it is the
county's obligation to replace the plumbing needed. We recommend that this
be brought to the attention of the county commissioners for consideration. The
Dade County jail appears to be in good condition and well operated.
ORGANIZED JRIME) IN INTERSTATE COMMERCE 759
ACKNOWLEDGMENTS
We wish to acknowledge the jissistance given this grand jury by Glenn C,
Mincer, John Prnnty, and Curry Harris.
AVe also wish to thank Judge Vernon Hawthorne and Judge Stanley Milledge
for their cooperation and assistance.
CONCLUSION
The term of this grand jury expiring by statute as of this date, we respectfully
submit this report covering our activities, investigations, and recommendations,
liespectfully submitted.
Dade County Grand Jury, Winter Term, 1948,
Thomas B. Hamilton, Foreman.
O. E. Hall, Clerk.
Dated this 10th day of May A. D. 1948.
Exhibit No. 129
In the Supreme Court of Florida, January Term, A. D. 1950, En Banc
Henry DeLancy et al., petitioners, v. The City of Miami, respondent
William F. Broome, petitioner, v. The City of Miami, respondent
Nathan Rubin, petitioner v. The City of Miami, respondent
Opinion filed January 17, 1950.
Writs of certiorari from the Circuit Court for Dade County, N. Vernon Haw-
thorne, judge.
Rol)erts, Holland & Strickland, for petitioners.
J. W. Watson and John D. Marsh, for respondent.
Thomas, J. : In the case of DcLunvy v. the City of Miami the petitioner
challenges the manner of executing the search warrant which we shall presently
discuss, while in all three cases the petitioners urge the insuflSciency of the aflfi-
davits farming bases for the warrants.
We shall devote our comment to the question common to all three petitions for
certiora'ri to review judgments of the circuit court affirming judgments of con-
viction in the municipal court because our investigation and examination con-
N ince us that the affidavits were fatally defective, and having this view about the
very foundation of the warrants, there appears no need to determine the propriety
of the service of them.
Substance of the affidavits was (1) that the affiants believed and had good
reason to believe that in a certain building gambling was being conducted by
unknown persons and (2) that the affiants' "reason for this belief was that they
had learned from an investigation" that such gamliling was being carried on. It
is the second statement with which we must find fault.
Section 22 of the Declaration of Rights protects the people against unreason-
able searches and seizures and specifically provides that no search warrant shall
issue except "upon probable cause, supported liy oath or afirmation, particularly
describing the place * * * to be searched and the person * * * and
things * * * |-Q j;,g seized." Of like effect are tlie provisions of the Fourth
Amendment to the Constitution of tlie United States.
The sole question for our decision is whether the affidavits from which we
have quoted set out sufficient facts, supporting the belief of the affiants, to
establish in the mind of the issuing officer probable cause that the laws against
gambling were being violated. In other words, can one procuring the writ
simply say that he has formed his belief from wliat he has learned from some
sort of investigation by some person or other, the officer not being informed how
or by whom the investigation was made, how the affiant came by the intelligence,
whether the information he, or, for that matter, his informant, received was
hearsay or mere rumor?
We fail to see how the aflBdavits now under consideration were any stronger
than the one condemned by a unanimous decision of this court in Cooper v. State
(106 Fla. 254, 143 So. 217). Here the affiant placed his belief upon what he
had learned from an investigation by someone whose name he did not disclose.
689.58 — 50— pt. 1 49
760 ORGANIZED CRIMEI IN INTERSTATE COIVIMERCE
In the cited case the affiant represented that his belief was based "upon informa-
tion furnished affiant by parties who have knowledge of a violation and whom
affiant believes to be truthful and reliable." A comment of the court on that
occasion fits as well the situation here : "It will be observed that this language
does not state any fact on which such reason or belief is based, but is equivalent
only to an allegation 'that affiant has reason to believe and does believe, on
information and belief.' "
This holding is not one peculiar to this court, but seems harmonious with
decisions of a majority of the courts on the subject. For instance, the Supreme
Court of the United States announced in Grau v. U. S. ( 287 U. S. 124, 77 L. Ed.
212), the rule that "a search warrant may issue only upon evidence which
would be competent in the trial of the offense before a jury * * * and
would lead a man of prudence and caution to believe that the offense has been
committed." Obviously the evidence before the officer who issued the warrants
in question would not be competent in a trial and would not convince a prudent
man that gambling was being conducted in the places to be searched.
Citations of other cases on the point may be found in 47 Am. Jr. 517 and 39
A. L. R. 838.
We are not unawai'e that guilty persons may go free where convincing evidence
against them is held inadmissible because obtained by defective search warrants.
But our paramount concern is for the guaranty in the organic law against un-
reasonable searches. We liave spoken on tliis subject, too, in Cooper v. State,
supra, where we approved Judge Cooley's comment that "It is oftentimes better
tliat crimes should go unpunished than that citizens should be liable to have
their premises invaded * * *."
We conclude that the search warrants were invalid ; so the writs of certiorari
are granted and the judgments of the circuit court affirming the judgments of
the municipal court are quashed.
Adams, C. J., Terkell, Chapman, Hopson, and Roberts, J. J., concur.
Exhibit No. 130
Dade County, Fla.
CRIMINAL investigation BUREAU
Statistics for 1949
Prisoners handled 8, 301
Fines and forfeitures $131, 942. 56
Convictions 5, 777
Prisoners serving time in county jail 368
Time served luonths 1, 527
Prisoners sent to State penitentiary 277
Time served years 1, 442
Warrants and capiases served 4,693
Homicide investigations :
Murder : 73
Fatal accidents 53
Rape 70
Suicide 63
Di'owning 24
Natural 158
Total investigations 441
Assaults with deadly weapons, attempted rape, etc 397
Burglary, robbery, and miscellaneous investigations 1,987
Total investigations 2, 822
Prisoners fingerprinted 3. 467
Prisoners photographed 3, 467
FBI records received and filed 2,706
Fugitive-wanted notices placed in file 2, 110
Name checks requested by other law-enforcement offices 3, 401
ORGAT^ZED CRIME) IN DSTTERSTATE COMMERCE 761
Statistics for 1949 — Continued
Persons fingerprinted and photographed listed according to crime
committed :
(Jambling 44
Operating a gambling house 494
Lottery 19
Illegal possession of puuchboards 10
Murder 32
Manslaughter 23
Rape 20
Illegal possession of slot machine 7
Number of machines seized 20
Burglary 256
Larceny 195
Robbery 76
Forgery 62
Embezzlement 128
Auto theft 172
Sex offenses (not including raiJe) 49
Prostitution 61
Investigation 844
Violating State narcotic laws 8
Violating State beverage laws 33
Juvenile cases 539
Court cases 00
Driving while intoxicated 273
Reckless driving, etc 832
Aggravated assault 29
Other assaults 17
Stolen property 15
Weapons 5
Offenses against family 26
Disorderly conduct 44
Drunkenness 95
Vagrancy 35
Fugitives or other holds 84
All other offenses 78
Jimmy Sullivan,
Sheriff, Dade Coxmiy, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
addition to the statistics for 1949
As a furtlier break down under persons fin^rerprinted, photographed, and
booked, listed according to the crime committed : Illegal possession slot ma-
chine, 7.
Jimmy Sullivan,
Sheriff, Dade County, Florida.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Statistics for 19.',8
Prisoners handled 8. 903
P^ines and forfeitures $105, 101. 88
Pi'isoners sent to State penitentiary 269
Time served, years 578
Witness subpenas served 14, 187
Warrants and capiases served 4,587
762 ORGANIZED CRIMD IN INTERSTATE COMMERCE
Statistics for 1948 — Continued
Homicide investigations :
Murder 55
Fatal accidents 36
Rape 68
Suicide 51
Drowning 40
Natural 105
Total 355
Assaults with deadly weapons, attempted rape 361
Burglary, robbery and miscellaneous investigations 1, 361
Total investigations 2, 077
Prisoners fingerprinted 2, 760
Prisoners photographed 2, 760
FBI records received and filed 7, 500
Name checks requested by other law-enforcement offices 3, 400
Persons fingerprinted, photographed, and booked, listed according
to crime committed :
Gambling 8
Operating gambling house 269
Lottery 0
Illegal possession punchboards 2
Murder 7
Manslaughter 15
Rape 15
Illegal possession of slot machines 6
Number of machines seized 10
Burglary 211
Larceny 273
Robbery 107
Forgery 35
Embezzlement 106
Auto theft 65
Sex offenses (not including rape) 12
Prostitution 19
Investigation 870
Violating State narcotic laws 17
Driving while intoxicated 214
Reckless driving 318
Aggravated assault 100
Other assaults 232
Disorderly conduct 4
Drunkenness 407
Vagrancy 110
Fugitive or other holds 333
All other offenses 5, 154
Jimmy Sulijvan,
meriff, Dade County, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Statistics for 19.',7
Prisoners handled 8, 072
Fines and forfeitures $80,595.12
Prisoners serving time in State penitentiary 219
Time served :
Years '''38
Life sentences 3
Warrants ;ind capias served 3,863
Witness subpenas served 10. 520
Note. — The criminal bureau of investigation was created April
1947. Records for this department begin May 1, 1947. Before this
date these cases were handled by the State attorney's office.
ORGANIZED CRIMEI IN INTERSTATE COMIVIERCE 763
Statistics for 19Jf7 — Continued
Homicide investigations :
IVIurder 48
Fatal accidents 21
Rape 23
Suicide 7
Drowning 26
Natural 22
Total 147
Assaults with deadly weapons, attempted rape 83
Burglary, robbery, and miscellaneous investigations 664
Total investigations 894
Prisoners fingerprinted 2, 883
Prisoners photographed 2, 883
FBI records received and filed 5, 766
Criminal registrations 200
Persons fingerprinted, photographed, and booked ligted according to
crime committed :
Gambling 7
Operating gambling house 142
Murder 12
Manslaughter 24
Rape 9
Illegal possession of slot machines 5
Number of machines seized 9
Larceny 240
Robbery 97
Forgery 19
Embezzlement ^ 41
Auto theft 59
Sex offenses (not including rape) 11
Prostitution 15
Investigation 603
Violating State "narcotic laws 8
Driving while intoxicated 180
Reckless driving 263
Aggravated assault 44
Drunkenness 360
Vagrancy 60
Fugitive or other holds 640
All other offenses 5,236
Jimmy Sullivan,
Sheriff, Dade Count u, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Statistics for 19-^6
Prisoners handled 7, 619
Fines and forfeitures — $88,370
Prisoners serving time in State penitentiary 113
Time served :
Years 361
Life sentences 4
Warrants and capias sei-ved 3, 191
Witness subpenas served 10, 010
Note. — Homicide investigations handled by State attorney's oflace.
Prisoners fingerprinted 2, 767
Prisoners photographed 2, 767
FBI records received and filed 5, 534
764 ORGANIZED CRIME IN INTERSTATE COMMERCE
Statistics for 19Jf6 — Continued
Persons fingerprinted, pliotograplied, and booked, listed according to
crime committed :
Gambling 28
Operating gambling house 298
Operating lottery 4
Illegal possession of punchboards - — - 1
Illegal possession of slot machines 11
Number of machines seized 20
Murder 31
Manslaughter 24
Rape 16
Sex offense (not including rape) 40
Forgery 28
Auto theft -— 81
Prostitution 5
Investigation 360
Violation of State narcotic laws 9
Drunkenness . - 695
"Vagrancy ■ 119
Fugitive or other holds 492
Driving while intoxicated 240
Break and enter 235
Assault and battery 194
Larceny 231
Embezzlement 55
Reckless driving 267
Aggravated assault 34
All other ofEenses 4,122
Jimmy Sullivan,
Sheriff, Dade County, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Statistics for 19^5
Prisoners handled 6, 574
Fines and forfeitures $43,825.39
Convictions 1, 224
Prisoners serving time in county jail 288
Time served months— 1 ,153
Prisoners sending time in State penitentiary 122
Time served :
Y^ars - 303
Life sentences 4
Warrants and capias served 2, 142
Witness subpenas served 6, 959
Note. — Homicide investigations handled by State attorney's office.
Prisoners fingerprinted 3. 208
Prisoners photographed 3, 208
Persons fingerprinted, photographed, and booked, listed according to
crime committed :
Gambling 37
Operating gambling house 89
Operating lottery 2
Illegal possession of slot machines 17
Number of machines seized 30
Murder 32
Manslaughter 22
Rape 14
Sex offense (not including rape) 15
Forgery IS
Auto theft 56
Prostitution 10
Investigation 310
ORGANIZED CRIMEI IN IXTEUSTATE COMMERCE
765
statistics for 19Jf5 — Continued
Persons fingerprinted, photographed, etc. — Continued
Violation of State narcotic laws 9
Drunkenness 339
Vagrancy 114
Fugitive or other holds 975
Driving while intoxicated 113
Break and enter 165
Assault and battery 179
Larceny 209
Embezzlement 44
All other olTenses 3, 805
Jimmy Sullivan,
Sheriff, Dade County, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Exhibit No. 131
Report of the activities of the sheriff's office criminal investigation bureati from
Fel. 1 through Mar. 15, 1950
Homicide investigations 39
Assaults with deadly weapons, attempted rape, etc 47
Burglary, robbery, and miscellaneous investigations 308
Total Investigations 394
Prisoners prosecuted by criminal investigation bureau 112
Capiases and warrants handled 1,066
Informations filed 144
Prisoners sent to Raiford 48
Prisoners sent to Dade County stockade 13
Fines and forfeitures $25, 768. 51
Gambling search warrants taken in January, February, and INIarch 48
BREAKDOWN OF INVESTIGATION MAN-HOURS
December
January
February
March
Investigation man-hours.
Man-hours on gambling .
3,564
690
3,861
713
2,002
382
COMPARISON OF POPULATION WITH GAMBLING ARRESTS
Estimated population
Percent gam-
bling arrests
Percent of
population of
Dade County
Miami, 200,000
Miami Beacli, 60,000
Hialeah, 20,000
Unincorporated area and small towns, 120,000
43.5
18.5
10
28
Report of the activities of the sheriff's office identification hureati from Feb. 1,
1950, throtigh Mar. 15, 1950
Prisoners fingerprinted 353
Prisonei's photographed 353
FBI records received and filed 1, 911
Fugitive wanted notices placed in file 78
Name checks requested by other law enforcement offices 552
766 ORGANIZED CRIME IN INTERSTATE COMMERCE
Report of the activities. of the sheriff's office identification bureau from Feb. 1,
1950, through Mar. 15, 1950 — Continued
Persons fingerprinted and photographed listed according to crime commit-
ted;
Murder 6
Manslaughter 1
Robbery 6
Aggravated assault 14
Other assaults 18
Burglary 36
Larceny 29
Au*o tlieft 9
Embezzlement and fraud 42
Stolen property 6
Forgery and counterfeiting 4
Rape 5
Sex offenses 5
Weapons 4
Offense against family and children 7
Liquor laws 3
Driving while intoxicated 29
Traffic and motor-vehicle laws 250
Disorderly conduct 25
Drunkenness 48
Vagrancy 7
Gambling 2
Operating gambling house 63
Court cases 289
Delinquent children 81
Fugitive or other holds 72
Investigation 100
All other offenses 30
Exhibit No. 132
' Febrtjaey 6, 1950.
Hon. Jimmy Suixivan,
Sheriff of Dade County,
Dade County Courthouse,
Miami, Fla.
Dear Sir : Following is a report of the activities of your criminal bureau of
investigation for January 1950 :
Homicide investigations 35
Assaults with deadly weapons, attempted rape investigations 40
Burglary, robbery, and miscellaneous investigations ISi
Total investigations 259
Pi'isoners prosecuted by criminal investigation bureau 129
Informations filed 152
Prisoners sent to Raiford 17
Prisoners sent to Dade County stockade 5
Fines and forfeitures $17, 279. 13
Personnel of the bureau now consists of nine investigators, each man being
assigned to a certain section of the county and the responsibility placed upon his
shoulders for the solving of crime in his particular territory.
Thei-e are two homicide investigators tliat handle all capital cases together
with criminal assaults, molestations and as.saults against the person with deadly
weapons. The bureau also has two reporters and a complaint desk man.
The office has the following equipment for modern crime detection and prepara-
tion of cases for prosecution :
One modern Scliaeffer Lie Detector.
One mine and metal detector.
One complete moulage kit for the rebuilding of mangled faces and for the
preservation of features for further identification.
One ultraviolet ray light.
ORGAiSnZED CRIMEI IN INTERSTATE COMMERCE 767
Nine cameras.
Twelve fingeriuint kits assigned to individual investigators and road patrol
cars.
One portable wire recorder.
One permanently installed disk recorder.
One blood detector kit.
One semen detector kit.
One restoration kit for the restoration of erased writing.
One numlter restoring kit for the restoration of deleted numbers on firearms
and automobile eng^ines.
One one-way observation mirror used in the observation and identification of
prisoners without their knowledge.
Yours truly,
Claude C. High,
Chief Criminal Investigator.
February 6, 1950.
Hon. Jimmy Sullivan,
Sheriff of Dade Couvfij,
Dade County CourtJwvse,
Miami, Fla.
Dear Sir : The following is a report of the activities of your Identification
Bureau for January 1950 :
Prisoners fingerprinted 296
Prisoners photographed 296
FBI records received and filed 383
Fugitive-wanted notices placed in file 156
Name checks requested by other law-enforcement offices 321
Persons fingerprinted and photographed, listed according to crime committed :
Gambling 12
Operating a gambling house 31
Lottery 12
Illegal possession punchboards 0
Murder 4
Manslaughter 2
Rape 1
Burglary 17
Larceny 21
Robbery 8
Forgery 5
Embezzlement 25
Auto theft 10
Sex offenses (not including rape) 4
Prostitution 0
Investigation 75
Violation State narcotics laws 1
Violation State beverage laws 9
Juvenile cases 46
Court cases 127
Driving while intoxicated 22
Reckless driving, etc 177
Aggravated assault 9
Other assault 14
Stolen property 3
Weapons 7
Olfense against family 3
Disorderly conduct 15
Drunkenness 33
Vagrancy '. 7
Fugitive or other holds 44
All other offenses 25
Yours truly,
Claude C. High,
Chief Criminal Investigator.
768 ORGANIZED CRIMEi IN INTERSTATE COMlVrERCE
Exhibit No. 133
Dade County, Florida
criminal investigation bureau
Statistics for 19-i-i
Prisoners handled 4, 510
Fines and forfeitures $40, 840. 72
Prisoners serving time in State penitentiary , 83
Time served :
Years 515
Life sentence 1
Warrants and capias served C)
AVitness subpenas served C)
Homicide investigations liandled by State's attorney's office :
Prisoners fingerprinted 2, 293
Prisoners photographed 2, 293
Prisoners fingerprinted, photographed, and booked, listed according to
crime committed :
Gambling 26
Operating gambling house 177
Operating lottery 15
Illegal possession of slot machine 14
Illegal possession of lottery tickets '. 32
Murder 15
Manslaughter 7
Rape 13
Sex offense (not including rape) 10
Forgery 14
Auto theft 63
Prostitution 2
Investigation 285
Violation of State narcotic laws 13
Drunkenness 163
Vagrancy 53
Fugitive or other holds 550
Driving while intoxicated 101
Break and enter 144
Reckless driving 120
Assault and battery 84
Aggravated assault 69
Larceny 188
Embezzlement 44
Robbery 34
^ Not available. Books of the previous administration containing information necessary
to compile the fisures marked "Not available" have not been located up to the present time.
The search is being continued, and when books are found a supplementary report will be
maae.
JiMMT Sullivan,
Sherilf, Dade County, Fla.
Claude C. High,
Chief, Criminal Bureau of Investigation.
Statistics for 1943
Prisoners handled 4, 035
Fines and forfeitures $30,000.74
Prisoners serving time in State i)enitentiary C)
Time served C)
Warrants and capias served { )
Witness subpenas served (*)
Homocile investigations handled by State's attorney's ofBce:
Prisoners fingerprinted : 2, 311
Prisoners photographed 2, 311
ORGAlSriZED CRIME IN INTERSTATE COMMERCE 769
Statistics for 1943 — Continued
Persons fingerprinted, photographed, and booked, listed according to
crime committed :
Gambling 20
Operating gambling house 47
Illegal possession of lottery tickets 3
Illegal possession of slot machine 16
Murder 10
Manslaughter 9
Rape 9
Sex offense (not including rape) 1
Prostitution 7
Forgery 5
Auto theft 48
Investigation 652
Violation of State narcotic laws 6
Drunkenness 151
Vagrancy 86
Fugitive or other holds 291
Driving while intoxicated 47
Breaking and entering 147
Reckless driving 91
Assault and battery 71
Aggravated assault 45
Larceny 134
Embezzlement 45
Robbery 34
All other offenses 2, 060
^ Note. — Books of the previous administration containing information necessary to com-
pile the figures marked (i) have not been located up to the present time. The search is
being continued, and when books are found a supplementary report will be made.
Jimmy Sullivan,
Sheriff, Dade County, Fla.
Claude O. High,
Chief, Critninal Bureau of Investigation.
Exhibit No. 135
July 12, 1950.
Memorandum to : Jimmy Sullivan, Sheriff.
(Attention: Claude C. High, Chief, Criminal Investigation Department.)
Reference to : The following is a partial listing of places that have been raided
by this department where three or more phones have been confiscated. This
also includes other apparatus used in bookmaking establishments.
March 5, 19^9. — Arlington Hotel, 455 Ocean Drive, Miami Beach, Fla. : six
telephones and wire service equipment.
March 5, 19-'i9. — Louis Kaufman, North Miami : five telephones.
March 20, 19^9. — Aviation Building, Northwest Twenty-seventh Avenue and
Thirty-third Street : seven telephones.
Septemher 15, 19^9. — 6505 Northwest Eighteenth Avenue : 6 telephones (used),
15 telephones (new, in boxes), 1 Army field telephone set, 2 head sets.
December 8, 19^9. — 139 Lindsay Court, Hialeah, Fla. : eight telephones, radio
equipment.
January Jf, 1950. — 2194 South Red Road : three telephones and equipment.
January 13, 1950. — 2360 Northwest Eighty-first : five telephones, equipment.
January 19, 1950. — 207 West Flagler : four telephones, equipment.
Fehruary 7, 1950. — 2180 Northwest Seventh Avenue : four telephones, equip-
ment.
March 8, 1950. — Versailles Hotel, 3425 Collins Avenue : three telephones. Clay
Hotel, 1438 Washington Avenue: three telephones. Good Hotel, 4301 Collins
Avenue, three telephones. Sea Isle Hotel, 3001 Collins Avenue, three telephones.
Monte Carlo Hotel, 6551 Collins Avenue: three telephones. Martinique Hotel,
6423 Collins Avenue : four telephones. Delmonico Hotel, 6393 Collins Avenue,
three telephones.
770 ORGANIZED CRIMEl IN INTERSTATE COMIVIERCE
April 6, 1950. — Tower Radio Shop, 718 Southwest Fifteenth Avenue : five tele-
phones ami equipment.
April 10, 1950. — Suburban Club Apartments, 1539 Northeast One Hundred and
Twenty-first Street: 1 6-position (12-line rotary) switchboard with 20 extra
phones confiscated ; other equipment.
April IJf, 1950. — Greentree Hotel, 110 Northeast Second Avenue : six phones and
other equipment.
April 25, 1950.- — Betsy Ross Hotel, 1044 Ocean Drive, Miami Beach: three tele-
phones. 210 Twenty-first, Miami Beach : three telephones.
Total phones : 137 phones confiscated.
Exhibit No. 136
In the Circuit Court of the Eleventh Judicial Circuit of Florida, in and
FOR Dade County. In Chancery
(No. )
Jimmy Sullivan, as Sheriff of Dade County, Florida, Plaintiff
V.
Stanley Milledge, as one of the Judges of the Circuit Court of the 11th Judicial
Circuit in and for Dade County, Florida, Defendant
BILL FOR declaratory DECREE
Now conies the Plaintiff, Jimmy Sullivan, as Sheriff of Dade County, Florida,
and exhibits this his Bill of Complaint against the Defendant Stanley Milledge,
as one of the Judges of the Circuit Court of the Eleventh Judicial Circuit in and
for Dade County, Florida, and thereupon complaining, says
1. Tliat this is an action for Declaratory Decree imder the provision of
Chapter 87, Florida Statutes Annotated, seeking a judicial determination and
declaration of the rights, status, and legal relations of the respective parties
hereto as affected by a statute, to wit : Chapter 47.12, F. S. A.
2. That Decree of this Honorable Court is sought declaring the rights, status,
and legal relations of the Plaintiff and Defendant, respectively, and a judicial
construction of, in light of the matters and things hereinafter alleged, Chapter
47.12 F. S. A. under which the Defendant has assumed to order and direct
certain acts, doings and things which, in the Plaintiff's opinion, violate the true
meaning and intent of the said statute, and through and by means of whicli
improvident and illegal acts and conduct, so precipitated by the said Defendant's
orders and directions aforesaid, certain official rights, powers, and prerogatives of
the Plaintiff and other regularly elected, qualified, and bonded public officials
of Dade County, Florida, are judicially violated and abused : and by and through
which improvident and unlawful orders and directions of the said Defendant,
acts of violence, disturbances of peace, affrays and possible bloodshed are en-
couraged, fomented, and precipitated, all contrary to the laws and statutes of
the State of Florida, in such case made and provided and against the peace
and welfare of the citizens of Dade County, Florida, as hereinafter more par-
ticularly alleged.
2. That the Plaintiff is the regularly elected, duly qualified and bonded
Sheriff of Dade County, Florida, labors under no physical or mental disability,
has not absented himself from the County, and in all matters and things has
faithfully served and executed the process of all Dade County Courts, including
those issued from time to time by the Defendant, as required by law ; that Plain-
tiff has duly posted and filed, as required by law, a $25,000 surety bond, has
subscribed to the required oath and is otherwise, in all matters and things, ready
able, and willing and qualified to serve the Defendant and all other Courts and
Judges in Dade County, Florida, on a twenty-four hour basis, as he and his
office have so served the said Judges and Courts for more than four years next
prior to the filing of this Bill of Complaint.
3. That Plaintiff, as Sheriff aforesaid, is a constitutional officer in that said
office is duly made and provided for in Article 5. Section 15. and Article S, Section
6, of the Constitution of the State of Florida ; that the Defendant holds his office
as Circuit Judge aforesaid under the Constitution of the State of Florida.
ORGANIZED CRIME IN INTERSTATE COMMERCE 771
That I'ljuntiffs office pertains and belongs to the Executive Branch of State
Government, whereas the Defendant's judicial office pertains and belongs to the
Judicial Branch of State Government.
4. That Chapter 26.49, F. S. A. provides "The Sheriff of the County shall be
the executive officer of the Circuit Court of the County." That by Chapters 34.07,
84.08, 36.11, and 32.26 Plaintiff is likewise made the executive officer of the County
Court, the County .Judge's Couit and the Criminal Court of Record, respectively ;
that by other statutes Plaintiff is made the executive officer of the Court of Crimes
and Civil Court of Records and has executive duties to perform in connection
with the Juvenile Court and Justice of Peace Court.
That by law Plaintiff likewise is the custodian and keeper of the County Jail
charged with the duty of receiving, segregating, feeding, and maintaining prison-
ers of all ages, sexes, colors, who are delivered into his hands by competent
arresting authority for safekeeping pending trial or service of misdemeanor
sentence of confinement lawfully imposed or pending delivery to the State Peni-
tentiary for .service of sentence of confinement for felony conviction.
5. Chapter 30.1.5, F. S. A. relating to the duties of Sheriffs in relation to
execution of Court processes provides "Each Sheriff shall, in person or by deputy,
execute all processes of the Supreme Court, Circuit Court, County Court, and
Criminal Court, and Board of County Commissioners to be executed in said Courts,
and such process of Justice of the Peace Courts as may come to his hands to be
executed." Chapter 30.19 F. S. A. provides a summary penalty for failure to
execute process and Chapter 30.20 provides a $500 fine for every false return on
process. That Chapter 47.12, P. S. A., which is the Statute relied upon by the
Defendant as authority for his judicial acts hereinafter .set forth and which
Plaintiff alleges the Defendant has misconstrued, misinterpreted, and misapplied,
provides as follows :
'•47.12 Process; by u-liom served. — All process, except that issuing from a
justice of the peace court, shall be served by the sheriff' or any constable of the
county in the district in which it is to be served. Process of a justice of the peace
court may be served by a sheriff of the county or by a constable. A justice of the
peace or a constable, in the respective counties, may serve all process in cases
where the sheriff is interested, and in case of necessity the judge of the circuit
court may appoint an elisor to act instead of the sheriff.
"All writs or process issued upon the institution of a suit which may be begun
in a county where the defendant does not reside, and all writs, process, or notices
requiring service upon a defendant not in the county where the suit is pending,
may be served by the sheriff" of the county or the constable of the justice district
in which the defendant is to be found."
The foregoing statute is found in the civil practice and procedure section of
F. S. A. and has no relation to criminal law or procedure. Said Chapter 47.12
immediately follows statutes which deal solely with issuance and service of civil
processes and matters pertinent to form of return of civil process. In fact.
Chapter 47 is entitled "Commencement of Suits at Law and Process," and there
is no reference within the chapter, as above alleged, to criminal process which
by its very nature involves use of force and, at times, arms, to detain and jail
persons accused or sentenced in criminal matters.
Chapter 901, F. S. A. found in the body of Florida Criminal procedure statutes
deals with arrests and provides for the form and contents of warrants and the
issuance and execution thereof in many respects.
Said Chapter 901, F. S. A., embraces the following among other provisions
of statutory law, viz :
''itOl.O.'f Direction and execution of wan-ant. — The Warrant shall be directed
to all and singular the sheriffs and constables of the State of Florida. It shall
be executed only by a sheriff or constable of the county in which the arrest is
made, unless the ari-est is made in hot pursuit, in which event it may be executed
by any sheriff' or constable who is advised of the existence of said warrant. An
arrest may be made on any day and at any time of the day or night."
"901.15 Wlie7i arrest hy offlccr u-ithout tcarrant is laioful. — A peace officer
may without warrant arrest a person :
"(1) When the person to be arrested has committed a felony or misdemeanor
in his presence. In the case of such arrest for a misdemeanor, the arrest shall
be made immediately or on fresh pursuit.
"(2) When a felony has in fact been committed, and he has reasonable ground
to believe that the person to be arrested has committed it.
772
ORGANIZED CRIMEi IN INTERSTATE COMMERCE
"(3) When he has reasonable ground to believe that a felony has been or is
being committed and reasonable gTOund to believe that the person to be arrested
has committed or is committing it.
"(4) When a warrant has been issued charging any criminal offense and has
been placed in the hands of any peace officer for execution."
"901.19 Right of officer to break into building. — (1) An officer, in order to
make an arrest either by virtue of a warrant, or when authorized to make such
arrest for a felony without a warrant, may break open a door or window of any
building in which the person to be arrested is or is reasonably believed to be,
if he is refused admittance after he has announced his authority and purpose.
"(2) Whenever an officer has entered a building in accordance with the pro-
visions herein, he may break open a door or window of the building, if detained
therein, when necessary for the purpose of liberating himself.
"(3) The sheriff, deputy sheriff, city marshal, constable or police officer, when
any of the implements, devices, or apparatus commonly used for gambling pur-
poses are found in any house, room, booth, or other place used for the purpose
of gambling, shall seize the same and hold them subject to the discretion of the
court, to be used as evidence and afterwards the same shall be publicly destroyed
in the presence of witnesses under order of the court to that effect."
Plaintiff alleges that nowhere in the above or anywhere within the statutes
of Florida relating to criminal procedure or criminal law is there any mention
of, or reference to, any type or variety of officer other than sheriff, deputy
sheriff, city marshal, constable, or municipal police officer.
6. Plaintiff says that heretofore on, to wit, April 4, 1949, the Defendant pre-
tending and assuming to act under Chapter 47.12, F. S. A. did receive from one
Donald Bauer, a professional and private detective of Miami, Florida, a docu-
ment entitled "Affidavit for Search Warrant" which affidavit was styled in
alleged proceeding between State of Florida as the Plaintiff, and Surfside Hotel,
located at 2457 Collins Avenue,- Miami Beach, Florida, as Defendant, in which
affidavit the said Donald Bauer, private detective aforesaid, falsely, basely,
maliciously, and fraudulently stated, in pait, as follows:
"Affiant further deposes and says that it is necessary for the court to appoint
an elisor to serve the search warrant hereby applied for, if issued, for the reason
as will appear from the evidence tendered herewith, should said warrant be
issued to either the Slieriff of this County or the Justice of the Peace or Con-
stable of the district in which said premises are situated, informance of said
issuance and protective execution thereof would reach the owners or operators
of said gambling premises prior to the execution of said warrant, thereby making
it possible for the removal of tl^e above described gambling equipment before
such execution were effected."
all of which will more fully appear by reference to photostatic copy of Affidavit
for Search Warrant hereto attached as Plaintiff's Exhibit A and made a part
hereof as fully as if herein set forth in extenso.
That upon presentation of the foregoing affidavit the Defendant Judge signed
a previously prepared search warrant appointing one Floyd F. Miner, the
alleged head of a local firm of private detectives or special investigators, and a
henchman and associate of the afore-mentioned Donald L. Bauer, to be and act
"as elisor of this court," and that in and by said search warrant the defendant
stated that "whereas evidence has been adduced before me that an elisor is
necessary to serve this warrant and I find that an elisor is necessary in accord-
ance with Chapter 47.12, F. S. A. for the service of this warrant" ; all of which
will more fully appear by reference to a photostatic copy of the alleged search
warrant aforesaid hereto attached as Plaintiff's Exhibit B and made a part
hereof as fully as if herein set forth in extenso.
7. Tliat upon receiving the search warrant aforesaid from the Defendant, the
said Floyd F. Miner, the alleged "elisor," togethei' with the said Donald L.
Bauer and other henchmen and associates in the same private detective and
investigating firm, named Ray Reaney, J. B. IMiller, and Clyde Appleton, each of
aforenamed individuals being armed with a pistol in violation of law, proceeded
in concert to the premises of Surfside Hotel, above set forth, and allegedly
searched tlie premises and executed the said search warrant in the maimer and
to the extent set forth in the "Return of service" signed by the aforesaid l'"'loyd
F. Miner, dated April 5, 1049, a photostatic coyiy of which is hereto attached as
Plaintiff's Exhibit C and made a part hereof as fully as if set forth in extenso.
8. That in truth and in fact tlie improvident and indiscreet act of the De-
fendant Judge and the actions had and taken thereinuler by the aforesaid armed
private detectives nearly resulted in tragedy and bloodshed in that the said
ORGANIZED CRIME IN INTERSTATE COMMERCE 773
"elisor" and said otlier private detectives, during their raiding of said premises
and seizing of proi>erty tlierein, drew their revolvers and threateningly pointed
same at divers of the occupants of the raided premises in an effort to show,
assert, and prove their authority when the existence of their raiding, property-
seizing and arresting power and authority was seriously questioned by divers
occupants of said premises who, for a time, refused to believe in the existence of
any such officer or authority as an "elisor," and it was only when police officers
of the City of Miami Beacli and an attorney representing the occupants of the
premises appeared on the scene that order was restored and the occupants agreed
to submit to arrest and detention under the aforesaid search warrant.
After the alleged arrest of some fourteen men at said premises by the De-
fendant's '"elisor," eleven of said occupants were booked at the County Jail on
charges of operation of a gambling house. According to newspaper reports one
man "disappeared," one man escaped detention at Miami Beach City Jail before
being brought to the County Jail, and a third was released by the "elisor" "be-
cause of a heart ailment."
9. Following the aioresaid raid the Defendant was quoted as stating that he
had acted according to his concept of duty as a Circuit Judge and the Defend-
ant's "eli.sor" stated he could clean "this whole thing up if they will leave me
alone," for the untoward, threatening, and almost disastrous happenings at and
during said armed raid of said private detectives, Plaintiff respectfully refers
the Court to divers newspaper accounts published in the Miami press and written
from eyewitness accounts of the said raid and interviews of principals therewith
connected, which said clippings are hereto attached in order of publication, as
Plaintiff's Exhibit D, and by reference made a part of this Petition for the pur-
pose of revealing to the Court that the injudicious and indiscreet conduct of the
Defandant herein and the armed blunderings of his "elisor" and the elisor's"
private detective associates constituted a "near miss" of serious and tragic
consequences, and to demonsti-ate that any repetition may possibly and will
probably incite disturbances and breaches of peace not unlike those which have
occurred in past history in cases where self-appointed vigilantes or white-robed
tyrants have armed themselves and in untrained, undemocratic, and illegal
manner have undertaken to take the law into their own hands, circumvent con-
stituted authority, and order and deal out their own brand of justice to citizens
of the community.
10. Plaintiff says that as regards the premises described in the affidavit and
seai-ch warrant above set forth, he has never visited therein nor trod thereon ;
that he does not know the owner or any agent of the owner or any lessee, if any,
or any agent of any lessee, nor did he know, nor had he ever been advised by
any person, whomsoever, that bookmaking was being operated within said prem-
ises ; that had he so known or been apprised or advised of any such fact or cir-
cumstance, he would have taken immediate action to effect raids and arrests to
the extent necessary to eliminate further violations of the gambling laws and
bring the offenders to proper justice. In this regard. Plaintiff has noted from
newspaper publications aforesaid that according to the said private detectives,
one of whom lived in said hotel iiroperty for several days for the purpose of
gathering evidence, alleged gambling operations were carried on with such
quietude and secretness that not even hotel bellboys were aware of its exist-
ence.
Plaintiff further says that knowing none of the principals involved in. or con-
nected with, said Surfside Hotel, or any of the persons therein arrested, that
the process is.sued by the Defendant could not possibly have served as a "case
where the Sheriff is interested" within the meaning of the statutes, notwith-
standing the fraudulent, false, and infamous allegations of the Bauer affidavit
for search warrant, as above recited.
Furthermore. Plaintiff says that even though the Defendant Judge considered
him "interested" for any reason whatsoever, the process of the Court, by law,
should have been delivered either to the Justice of the Peace or Constable for
service. Affidavits are hereto attached as Plaintiff's Exhibits E and F, re-
spectively, of the Honorable Kenneth Oka, Justice of the Peace, and John A.
Whalen, as Constable of the Fifth Justice of the Peace District, showing that
each of said regularly elected, bonded and acting constitutional officers was pres-
ent in said district and stood ready, able, and willing to serve the process of
Defendant Judge so issued against said Surfside Hotel premises; that neither
on the day of said issuance nor at any other time was either said Justice of Peace
or Constable requested to serve any search warrant, writ, or any other process,
774 ORGANIZED CRIMEl IN INTERSTATE COMMERCE
and that liad any Circuit Judge i-equested such service of process, both said offi-
cers stood ready and willing to effect prompt, efficient, and adequate service.
That in light of the above facts there was no "case of necessity" within the
statutory meaning and Janguage for appointment of an elisor, even granting for
discussion alone that an elisor may properly be appointed to serve criminal
process. In this regard, there has never been an instance in which the Plaintiff,
now in his second term as Sheriff of Dade County, or any Deputy Sheriff in the
Plaintiff's office, has ever failed, neglected, or refused properly and efficiently
to serve writs, processes, and directions of the Defendant Judge, nor has there
ever been an instance or case in which the Plaintiff' or any one in his employ,
has ever given "informance or issuance and prospective execution" of any
search warrant or other criminal or arresting process of this Court for the
purpose of warning or notifying owners or operators of gambling premises ;
and Plaintiff brands as a vicious and reprehensible lie the statement to the above
effect so made by the aforesaid Bauer. At no time or place or under any circum-
stance has the said Bauer or any of his henchmen or associates ever had any
contact or association with the Plaintiff or Deputy Sheriffs in his employ which
W'ould give bim or them legitimate, actual, or reasonable grounds to swear upon
oath that informance to Defendants would be made by this Plaintiff in the event
he or his deputies were called upon to serve only one of many hundreds of
similar search warrants which the Defendant has handled properly and effi-
ciently during his tenure as Sheriff aforesaid.
Plaintiff further alleges that neither the said Bauer nor any of his henchmen
or associates had any legitimate, actual, or reasonable grounds to believe that
both the Justice of Peace and Constable aforesaid would, if requested to serve
search warrant process "give informance" to the Defendants and make possible
their avoidance of arrest and removal of property, in that according to Plaintiff's
information and belief, neither the said Bai;er nor any one of his henchmen or
associates has ever had any business relations of any type or variety with the
said Justice of Peace or Constable — both constitutional, bonded and elected officers
of this County — which would give reasonable, actual, and legitimate reason for
the making of the aforesaid base and infamous affidavit against this Plaintiff
and said Justice of Peace and Constable.
Plaintiff further says that the granting and issuance of the alleged search
warrant by Defendant Judge, upon the scurrilous and reprehensible affidavit
aforesaid, witliout affording Plaintiff an opportunity to be heard and without
affording the aforesaid Justice of Peace and Constable an opportunity to be
heard, l)iit proceedings in an ex parte and unnoticed, one-sided hearing in the
manner and to the extent above set forth, had the effect of adjudicating the truth
of the said Bauer's false affidavit and placing the Defendant Judge's stamp of
approval and agreement thereon, amounting to a prejudging, without hearing
or trial of the guilt of Plaintiff* and the other constitutional officers aforesaid
of malfeasance in their respective offices, in matters which they had no interest
and as to which neither was in any sense disqualified by interest or otherwise
from fully and thoroughly performing his statutory office in respect of the service
of the process of the said Defendant Judge.
Wherefore, Plaintiff respectfully prays as follows :
(a) That the Court will take jurisdiction of this cause, the parties hereto and
subject matters hereof ;
(b) That upon the coming in of Defendant's answer hereto the Court will
proceed to construe, interpret, and adjvidicate tbe true meaning, intent and
purpose of Chapter 417.12, F. S. A., in respect of the rights, privileges, interests and
official functions of the Plaintiff" and Defendant in their respective official capaci-
ties, as regards the said statute, and the practical workings thereof :
(c) That the Court, in said Declaratory Decree and Judgment, will find and
declare that said Statute relates only to civil process and not to criminal process.
(d) That the Court will further find and declare that under the facts and
circumstances in this case there existed no necessity, in a statutory sense, war-
ranting the issuance by Defendant Judge of a search warrant predicated upon
judicial fiat tbat an elisor was "necessary" for the service of said warrant; tbat
in and by said r>eclaratory Decree and Judgment the Court will further find
that even tliough tbe Defendant Judge or Judge Ix'fore whom similar application
would b(> made is of tbe opinion that Plaintiff "is interested" in a case, in the
statutory sense, that before an elisor may l>e appointed it nuist be furtbcr shown
beyond reasonable doubt that tbe other two i-emaining constitutional officers
mentlf)ne(1 in tiie statute, viz. .Tuslice of Peace and Consl-i)it(\ wei-e likewise
interested or otherwise disqualified from iierforming their official functions as a
ORGANIZED CRIME! IN INTERSTATE COMMERCE 775
condition precedent to the appointment of sucli elisor, and lience tliat the mean-
ing of the statute is that an elisor should never be appointed where either the
I'liiintiff or the other two constitutional olhcers herein named are available
and stand ready and willing t^*' serve the Court's process in such mattei's.
(e) That in and by said Declaratory Decree the Court will further find that
the bare statement of a professionally employed, self-interested, and prejudicial
private detective is not sullicient to make a case of "necessity" wbere no necessity
in fact actually exists and that in such matter the proofs proiluced before the
Court should clearly and convincingly eslablish the interest or other dis(pialifica-
tions of the Sheriff, the Justice of Peace, and the Constable before each of those
three constitutional otticers should suffer tlie indignity and injustice of sununary
adjudication of official wrongdoing by and through means of ex parte issiiance
by the Defendant Judge of a search warrant which stamps as approved and
true the base, insidious, and false statements so produced before the Court by
private investigator Bauer aforesaid.
(f) That the Court in said Declaratory Decree will further find and declare
upon the seriousness of dispatching civilians to serve criminal processes, effect
arrests, and seize properties where no real necessity therefore exists ; and that
the Court will find that except in cases of actual dire and extreme necessity,
properly elected, qualilied, bonded, and acting constitutional officers should be
retpiired to serve such process.
(g) That the Court in said Declaratory Decree will further find that even in
a proper case where necessity may exist for the appointment of an elisor such
officer should be a disinterested and proper person of the community and not
a professionally employed, gun-carrying private detective with appetite and
inclination sharpened and whetted towards the execution of a selfish professional
mission, looking toward the collection of a fee and compensation from a private
source of employment.
(h) That the Court in and by said Declaratory Decree will find that in cases
where an elisor is appointed he is not privileged to carry arms or weapons, and
that, if necessary in the execution of the Court's processes, in the opinion of the
Court (not the elisor), he should request and summon the assistance of the
Sheriff, a Deputy Sheriff, policeman, city marshal, or constable, all of whom
are traditional and well-known officers of the law, for the purpose of avoiding
a physical affray, disturbance of peace, and possible violence and bloodshed
at and upon the attemiit by the elisor so appointed to .serve his process and to
assist the elisor in his necessarily primary and fundamental task of convincing
law breakers that he is a I'eal and actual and bona fide officer of the law for
the purpose of said process service.
(i) That the Court in and by said Declaratory Decree will determine all
a.spects of the rights and interests of the Plaintiff and Defendant herein arising
under the conflicting interpretations of said Chapter 47.12 F. S. A., and in so
doing define the "case of necessity" in the statutory sense which must be made
out as a condition precedent to the appointment of an elisor, in criminal or
civil matters, and what facts or circumstances must be proved to make the "case
of necessity" so provided by statute.
Jimmy Sullivan,
As Sheriff of Dride Coiinfi/, Fla.
Hunt & Salley,
By .
Attorneys for Plaintiff.
In the Circuit Court of the Eleventh Judicial Circuit in and for Dade
County, Florida
(No. 123S13-A)
Jimmy SuUivan, as Sheriff of Dade County, Florida, Plaintiff,
V.
Stanley Milledge, as one of the Judges of the Cireuit Court of the 11th Judicial
Cireuit in and for Dade County, Florida, Defendant.
opinion and order
Holt, J. : Application was made to the defendant for the issuance of a search
warrant of certain premises located in Miami Beach, Florida, and the appoint-
68958-— 50— pt. 1 50
776 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
ment of an elisor to serve said search warrant under Section 47.12 F. S. A. wliicli
reads as follows :
"^7i2 Process; hy whom served. — All process, except that issuing from a
justice of the peace court, shall be served by the sheriff or any constable of the
county in the district in which it is to be served. Pi'ocess of a justice of the
peace court may be served by a sheriff of the county or by a constable. A justice
of the peace or a constable, in the respective counties, may serve all process in
cases where the sheriff is interested, and in case of necessity the judge of the
circuit court may appoint an elisor to act instead of the sheriff.
"All writs of process issued upon the institution of a suit which may be begun
in a county where the defendant does not reside, and all writs, process, or notices
requiring service upon a defendant not in the county where the suit is pending,
may be served by the sheriff of the county or the constable of the justice district
in which the defendant is to be found."
This was done. A raid was thereafter made by the court appointed and armed
elisor, and several persons found there alleged to have been unlawfully booking
bets on horse races, arrested, taken into custody and charged with violation of
the criminal laws of this state. (The court takes judicial cognizance of the
fact that thereafter a civil suit was instituted in this court by the owner of the
building so raided, wherein and whereby he sought to revoke the lease of said
premises on the ground that it had been used for gambling activities and thereby
violated one of the terms of said lease and thus forfeited the tenant's right to
possession thereof. This suit is still pending.)
At the time of the appointment of the elisor the applicant therefor presented
an affidavit, which in substance stated that if the Sheriff or his deputies, or the
Justice of the Peace, or Constable of the Justice of the Peace's District in Miami
Beach were given the warrant to serve, knowledge of the same would reach the
operators of the premises before any arrest could be made.
Plaintiff by his bill seeks to have his authority with reference to the cited
statute clarified and ascertained by a declaratory judgment of this court.
Defendant has asked that the bill be dismissed and it is upon this motion argu-
ment was had by all interested parties.
There is little precedent to go upon in determining the authority of the court
to appoint an elisor. Only one time in the history of Dade County has a pre-
vious appointment been made, and that was when an incumbent sheriff was in-
dicted, and the Clerk of this Court was appointed an elisor to serve the warrant
upon him and arrest him for such act, as the sheriff was obviously disqualified
to arrest himself.
In the other known instance in the State, one cited at length by defendant's
counsel, "The Club Diamond," located in Volusia County, Florida, an elisor was
appointed therein by a visiting Circuit Judge. Upon his departure tlie resident
Circuit Judge refused to take any action and certiorari sued out to the Supreme
Court of Florida, which was denied without opinion. This is cited as authority
by counsel for the defendant. The disposition of writs of certiorari by the
Supreme Court in the past several years has not been of a character as to warrant
such assumption.
Without discussing the proposition (and it has some merit) that the statute
involved is applicable only to civil proceedings since it is found in that section
of the Florida Statutes relating solely to civil process, the question of the ap-
pointment of elisors in criminal cases is one of great importance to the people
of this county.
All laws should be enforced fairly and impartially without fear of or favor to
anyone. The Sheriff of this county is its chief law-enforcement officer. If he
fails to do his duty, recourse may be had under the laws of this State ; for action
on his bond ; or by appeal to a higher authority for his removal for deficiencies in
the administration of his office ; or by the good old-fashioned American demo-
cratic method of replacing him at the ballot box.
From the facts and circumstances alleged in the bill and admitted to be true
by the motion to dismiss, the Sheriff of this county, nor the Justice of the Peace,
or the Constable of the Justice of the Peace's District wm-e not discp'.alitied in"
any way to perform the functions of their constitutional olJices. To oust elected
functicming and bonded officials in this manner invites chaos, revolution, and
bloodshed.
There is no provision in the law of this State whereby a person wrongfully
arrested, injured, or killed by an elisor is protected in any wise. It was never
intended by the Legislature, nor can any such intention be derived from the
statute, that such court-appointed elisors could supplant the duly elected and
ORGATSnZED CRIMB IN LN^TERSTATE COMMERCE
777
acting chief law-enforcement oflScer of the county. To follow such contention to
a logical conclusion, whenever any person became aggrieved at the Hheriri' and
application made for the appointment of an elisor, either for civil or criminal
purposes, there would be so many elisors running around the county, with guns
in their pockets^ invading the private property of our citizens, they would be
reminiscent of Al Capp's "Kigmys" of comic-strip fame.
The foregoing may be true in a proper case, with proper parties. We do not
and cannot decide the validity of the appointment of the elisor in this case. It
i.s our conclusion that even though the bill is drawn in the form of a declaratory
decree (and Florida has the most liberal laws pertaining to the same in the
entire nation), it is a direct attack upon the official actions of a Judge of this
Court. Regardless of whether one agrees or not with the official acts and
functions of a Judge, such are performed in his judicial capacity and cannot be
questioned by any proceeding brought in this court with such Judge a party
defendant.
Being of the opinion that we are without jurisdiction to hear and decide this
matter.
It is thereupon ordered, adjudged and decreed that the motion of the defend-
ant be sustained and the bill be dismissed.
Done and ordered this 30th day of November A. D. 1949.
George E. Holt.
This Court being without jurisdiction, we concur in the Judgment of Dismissal :
N. Vernon Hawthorne,
William A. Herin,
Circuit Judges.
I did not hear the ai-gument. I did read the record and the briefs submitted.
From this consideration I concur and join in the foregoing opinion and order.
(S) Marshall C. Wiseheart,
Circuit Judge.
Exhibit No. 138
Home of Joliii Aimcrsula, 1 l.'U Allmi Knjid, .Miami r.cadi. i"la.
778
J'M'<
ORGANIZED CRIMEi IN INTERSTATE CO]MjMERCE
ExHiiar No. 130
yf^rv '■ '■■ ^^NrJ^i^*^'S^ii?^-5ft ■
llni if ^,1111 Taran, (3520 Allison Road, IMiaiiii lii'.nli. Fla.
Exhibit No. 140
IliMiif i>i ii.iliili i;u,i;li(), Miami BeiK-li, l'"la.
ORGAXIZED CRIMEI IN INTERSTATE COMlVrERCE 779
Exirir.TT No. 141
JLlnmn of Martin Leo Acciirdu, (Jural Gable«, 11a.
Emu HIT No. 142
Home of Charles Fischetti, Miami Beach, Fla.
780 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
Exhibit No. 143
Homo of Tony Accardo, Miami Beucli, I'la.
ORGATSriZED CRIMEI IN INTERSTATE COMMERCE
781
Exhibit No. 145
Arrests, second quarter, 1946
Charge
April
May
June
Abandonment -.,
Adultery
Aggravated assault-
Armed robbery
Assault and battery
Assault, lewd and lascivious
Assault to murder. _
Attempted kidnaping
Attempted rape
Bigamy
Board-bill fraud
Breaking and entering
Carrying concealed weapons
Conspiracy
Contempt of court
Contributing to delinquency of minor. -
Delinquent children
Drunk
Drunk driving
Embezzlement
Extortion
Failure to register as felon
False imprisonment
Forgery
Fugitive from justice
Gambling
Held for others
Illegal disposal of garbage
Indecent exposure
Immigration
Investigation
Inquest for lunacy
Larceny
Grand
M/V
Petit
Manslaughter
Molesting women
Murder
N. M. V. T. A.
Nonsupport
Obtaining money under false pretenses.
Operating gambling house
Operating lottery
P. L...
Possession of lottery tickets
Possession of slot machines
Practicing medicine without license
Profane language .. _
P. W
Rape
Receiving stolen property
Reckless display of firearms
Reckless driving
S. S. A
Trespassing
Unarmed robbery
Unlawful disposal of property
Vagrancy
Violation of—
Beverage laws
Building laws
Game laws
Health unit
Liquor laws
M/V laws
Narcotic laws ..,
Parole
Probation.
Property laws
Sanitary Code
Worthless checks
Writs of ne exeat
10
4
3
1
1
5
9
3
2
103
5
2
4
3
1
3
25
2
2
1
78
5
3
4
3
Total.
4
11
3
500
782 ORGANIZED CRIME IN INTERSTATE COMMERCE
K\iin 1 1 Xi). 1.")1
1S03 Northwest Sixth Street.
ExHiiuT No. 1~>2
-Syj.1 SoiUhuf.sL l'\)tii-lli Sli'L'cl.
ORGATSriZED CRIMEl IN INTERSTATE COMMERCE
Exhibit No. 153
783
yuLiLlr,\u-<L i'uurtli rSlrt'el.
ExHiniT No. l."')4
HoiU i^uuthw L'«L ruurlli SLi-fct.
784 ORGANIZED CRIME IN INTERSTATE COMMERCE
Exhibit No. 155
>SiiUlluVU,>L I'illll SUX'Cl.
Exhibit No. 156
_'0 Sniil hwcsl Xililll SI reel.
ORGATSnZED CRIME IN INTERSTATE COMMERCE 785
Exhibit No. 157
yyAi.-AXi^'Ma. ijCU-iJi 1
_';;;ii: Sduiiiwcsi i-'uih su-eei.
Exhibit No. 1.58
2-oG-o8 Suulliwe.sL First Street.
786
ORGANIZED CRIME IN INTERSTATE COMMERCE
Exhibit No. 159
lil.'40-42 Southwest First Street.
Exhibit No. 100
261 Southwest Thirtieth Road.
ORGAlsnZED CRIME! IN INTERSTATE COMMERCE 787
ExHiHiT No. ir>l
2485 Southwest Fourth Street.
Exhibit No. 163
James A. Sullivan, Miami, Fla. — Statement of financial condition on Jan. 1, 19^4
Cash on hand and in banks $12, 850. 00
Notes receivable - 1, 967. 33
U. S. Treasury bonds 337. 50
Automobile 150. 00
Real estate and improvements at cost : 7, 000. 00
Total assets 23, 204. 83
Liabilities: Mortgage payable on real estate 3,651.92
Net worth 19, 552. 91
788
ORGANIZED CRIMEi IN INTERSTATE COMMERCE
James A. Sullivan, Miami, Fla. — Statement of financial condition as of
July 12, 1950
Assets :
Cash on hand and in banks $37, 626. 24
Notes receivable - 2, 200. 00
Bonds at cost - 1, 468. 75
Automobiles (2) 3,916. 79
Residence and furnishings, 2485 Southwest 4th St 32, 000. 00
Total assets 77, 211. 78
Liabilities: Mortgage payable (residence) 18,000.00
Net worth ' 59, 211. 78
^ The increase in net worth occurring since Jan. 1, 1944, arises from income received
durins the period from the following sources :
Salary $.51, 34.S. 12
Profit on sale of real estate .30, 469. 10
Interest, rent, and miscellaneous 12, 124. 86
Total 93, 937. 08
Exhibit No. 165
Contributions by 8. & G. Syndicate to police and firemen's associations
Date
Check
No.
Amount
Apr. 18,1950
Justices of Peace and Constables Association
2,864
1,752
3, 030
512
338
1,755
1,723
1,565
1,878
1,635
1,640
373
386
768
$100
Apr. 13,1950
do
100
June 22,1950
Hialeah Police and Firemans As.soeiation-.
100
Feb. 5, 1918
do_
50
Jan. 14, 1948
do
50
Apr. 14, 1950
West Miami Police Association
50
Mar. 20, 1950
do .
50
June 11,1949
The Florida Peace Officer
100
Jan. 12,1919
Dade County Road Patrol Benevolent Association
100
Nov. 8,1948
North Miami Beach Police Department
50
Nov. 12, 1948
-do ....
50
Jan. 22, 1948
do
50
Jan. 30.1948
Miami PoHce Benevolent Association ._, ._
200
Mar. 17,1948
South Miami Police and Firemans Association
50
ORGANIZED CRIMEI IN INTERSTATE COIVCVIERCE
789
Exhibit No. 166
Checks issued for "regular" wire service
Date
Check
No.
Endorsement
Jan.
Jan.
Jan.
Dec.
Jan.
Jan.
Dec.
Feb.
Feb.
Feb.
Feb.
Mar.
Mar.
Mar.
Mar.
Apr.
Apr.
Apr.
May
June
June
May
May
May
May
June
June
June
July
July
July
Aug.
Aug.
Aug.
Aug.
Sept.
Sept.
Sept.
Sept.
Oct.
Oct.
Oct.
Oct.
Nov.
Nov.
Nov.
Nov.
Dec.
Dec.
Dec.
Dec.
Jan.
Jan.
5, 1948
19. 1948
12, 1948
29. 1947
31. 1948
26, 1948
22. 1947
5,1948
14. 1948
2.3, 1948
28, 1948
8, 1948
15, 1948
22, 1948
29, 1948
5, 1948
12,1948
28, 1948
17,1948
21, 1948
29, 1948
24, 1948
31, 1948
3, 1948
10, 1948
7, 1948
14, 1948
26, 1948
6, 1948
12,1948
19, 1948
2,1948
9, 1948
16, 1948
27. 1948
6, 1948
13, 1948
20, 1948
27, 1948
4, 1948
11,1948
18, 1948
25, 1948 ,
8, 1948 ,
22, 1948
1, 1948
15, 1948
4, 1948
6, 1948
13. 1948
20. 1948
5, 1948 .
13. 1949
Cash
do
Cash, services to Jan. 17-
Cash
do
.do_
-do-
.do-
.do.
.do-
.do.
.do.
-do.
.do.
.do.
_do.
.do-
.do.
-do-
.do-
.do.
.do-
-do-
.do-
.do_
.do.
.do.
.do-
-do-
.do-
.do.
.do.
.do.
.do-
.do-
do
do
do
do
do---
...do
....do
..-.do
-...do
do
do
--.do
....do
..-.do
...-do
....do
---.do
Intra State News and Service.
Jan. 24,1949 do.
Jan. 31, 1949 do.
Feb. 7.1949 do.
Feb. 14,1949 do-
Jan. 17,1949 do.
Mar. 24,1949 do-
Mar. 28,1949 do.
Apr. 4, 1949 do-
Apr. 11,1949 do-
Apr. 30,1949 do-
Mav 30, 1949 do.
May 9,1949 do.
May 16,1949 do.
May 23, 1949
Mar. 20, 1950
.do.
Intra State News and Service,
through Mar. 25.
Mar. 13. 1950 Intra State News and Service,
5 weeks through Mar. 18.
Apr. 4,1950 M. O. Brien ..
Apr. 10,1950 do
Apr. 17,1950 do
May 5, 1950 Morgan O. Brien, through
May 6.
May 20,1950 Intra State News and Service
318
353
362
247
392
380
228
503
522
535
543
726
762
670
684
833
850
967
1035
1151
1166
1052
1062
757
773
800
811
1250
833
8.50
1233
1312
1332
1341
1352
1407
1421
1436
1444
1501
1518
1530
1546
1640
1667
917
920
1741
1745
1771
1789
1842
1883
1999
1031
1048
1062
937
2242
1254
1285
1303
2306
1549
1514
1523
1535
2783
2832
2842
2861
2976
2794
500. 00
500.00
833. 33
500.00
500.00
500.00
500.00
500. 00
500.00
500. 00
500.00
500.00
500.00
500.00
500.00
500.00
500.00
200. 00
600.00
600.00
600. 00
600. 00
600. 00
600.00
600.00
600.00
600.00
600.00
600. 00
600.00
600. 00
600. 00
600.00
600.00
600.00
600. 00
600. 00
600. 00
600. 00
600. 00
600. 00
600.00
600. 00
600. 00
600. 00
600. 00
600.00
200.00
500. 00
500. 00
000. 00
500.00
500.00
2, 500. 00
2, 500. 00
2, 500. 00
2, 500. 00
2, 500. 00
7, 500. 00
2. .500. 00
2, 500. 00
2, 500. 00
2, 433. 00
600. 00
600. 00
600. 00
600. 00
1, 000. 00
5, 000. 00
2, OOO. 00
1,000.00
1, 000. 00
400.00
1,000.00
Dade County Newsdealers Sy. Co.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Do.
Ed. Petry-Leroy G.?
Dade County Newsdealers Sy.
Same, W. M. Hagertv, owner,
D. C.N. S.
Do.
Do.
Do.
Do.
Do.
Do.
Dade County Newsdealers Sy. Co.
Do.
Same, W. M. H., owner, D. C.
N. S.
Do.
Do.
Dade County Newsdealeis Sy.
Same, W. M. H., owner, D, C.
N. S.
Do.
Same, W. M. H., owner, D. C.
N S
M. O. Brien, D. C. N. S. Co.
Do.
Do.
Morgan O. Brien, Graham Press.
Same, W. M. H., owner, D. C.
N. S.
790
ORGANIZED CRIMEI IN INTERSTATE COMMERCE
Exhibit No. 167
Checks issued for "speciaV wire service
Date
Check
No.
Amount
Endorser
Jan. 5, 1948
Cash
319
363
391
544
727
834
758
801
834
1313
1408
1502
918
1744
1841
2026
2223
1286
1548
1499
1629
2481
1667
2546
2570
2610
2f88
2795
$228. 37
136. 80
290. 00
290. 00
94.00
290. 47
290. 47
290. 47
290. 47
290. 47
290. 47
290. 47
290. 47
290. 47
644. 24
349. 50
349. 50
433. 50
349. 50
433. 50
.349. 50
349. 50
349. 50
349. 50
349. 50
349. 50
94.00
721.00
Dade County Newsdealers Sy. Co.
Do.
Jan 12 1948
do . - -
Jan. 31,1948
Feb 28 1948
do
do
Do.
Do.
Mar. 8, 1948
do.:
Do.
Apr. 5, 1948
May 3,1948
June 7, 1948
do
Do.
do
Do.
. ..do
Do.
July 6, 1948
Aug. 2, 1948
do
Do.
. . do
Do. •
Sept. 6,1948
Oct. 4, 1948
do.... .
Do.
. . do
Do.
Nov. 1,1948
do -.
Do.
Dec. 6, 1948
do
Do.
Jan. 5, 1949
do
Do.
Feb. 9, 1949
do
Do.
Mar. 17, 1949
....do
Do.
Apr. 4, 1949
May 30, 1949
May 4, 1949
July 5, 1949
Aug. 1,1949
do
Do.
...do
Do.
do ..
Do.
do
Do.
do
Do.
Sept. 7,1949
Oct. 3, 1949
Cash, special service, September
1949.
Cash
Do.
Do.
Nov. 1.1949
....do
Do.
Dee. 9, 1949
do .
Do.
Jan. 25,1950
May 21,1950
Cash, special wire service
The Graham Press. .. _ .
S. & G. Service.
The Graham Press.
Exhibit No. 168
Gross betting receipts by S. d G. syndicate showing interruption Feb. 20 to Mar.
Jf — total ins by day, January to April 1949
Day
January
February
March
April
Day
January
February
March
April
1
$67, 474
s
82, 913
109, 284
112,975
104, 856
108, 580
118,067
S
88, 884
107, 287
130, 453
129,371
123,213
131,272
S
97, 222
$171,629
1S9, 696
183, 324
226, 206
243, 515
S
197, 610
230, 852
241,086
233, 777
236, 461
234, 657
S
184, 365
246, 082
241, 932
242, 720
$1,56,033
156,082
S
141,344
1.33, 537
125,872
136, 125
139, 907
133, 604
S
105, 102
122, 467
122, 612
114,238
110,881
130, 203
S
18
19
20
21
22
23
24
25
26
27
28
29
30
31
$134, 430
139, 263
157,886
153, 178
164,833
S
123, 673
143,114
191, 427
180, 740
168, 736
187, 809
S
127, 523
$290,040
97, 720
S
*$116,840
*129,06D
S
89, 227
149,112
16?, 347
175, 793
165, 477
172, 894
S
130, 723
134,811
154, 2M
145,838
$106,615
125 417
2
3
108 375
4
$86, 151
53,453
S
45, 510
54,607
61, 796
70, 418
59, 124
82, 431
S
81,364
98, 772
125, 930
136, 297
124,017
5
125,449
6
125, G53
7
8
S
94,953
9
97, 387
10
11
S
110,923
107, 498
12
103, 409
13
112,495
14
15
16
S
3, 384, 463
3, 691, 672
2, 682, 228
17
Layoff
Loss, Feb. 18
Loss, Feb. 19
Total loss, February
S= Sundays.
$19,215.60
17, 774. 40
, 877. 25
195. 10
36, 990. 00
37, 002. 30
9, 072. 35
17, 926. CO
ORGATSnZED CRIMEI IN INTERSTATE COMMERCE
791
Exhibit No. 169
Orange Park Kennel Cluh, Inc., Orange Park, Fla. — Statement of dividend checks
issued as of Jan. 10, 19-'i8, on the Florida National Bank
Name
Address
Number
of shares
Dividend
paid
Carl T. Hoffman and Annie M. Hoff-
Ingraham Bldg., Miami, Fla
300
30
30
30
20
20
20
20
20
50
50
30
60
10
20
450
300
150
450
450
450
40
$3,000
300
300
300
20O
man (husband and wife).
Ethel Blume
1638 Edgewood, Jacksonville, Fla
9500 Carlysle, Surfside, Miami Beach,
Fla.
636 Stockton St., Jacksonville, Fla
2958 Oak St., Jacksonville, Fla..
Courthouse, Jacksonville, Fla
1307 Avondale. Jacksonville, Fla
Orange Park, Fla .
Josephine Bennett
H. H. Humphries and Margaret Hum-
phries (husband and wife).
Pearl Norris
Rex Sweet
20O
200
200'
Geo. A. Pierce
T. J. Jennings, Jr _
John P. Hail
Green Cove Springs, Fla
200
500
500
Mvlee Dyer -_-
15th and Cass Ave., St. Louis, Mo
do
Bart Dyer
Paul E. Reinhold
Anne E. Johnston
Venetia Sub., Jacksonville, Fla
1090 Arbor Lane, Jacksonville, Fla
Floridan Hotel, Tampa, Fla
2503 River Rd., Jacksonville, Fla.
1090 Arbor Lane, Jacksonville, Fla
2503 River Rd., Jacksonville, Fla
1722 Edgewood, Jacksonville, Fla.
511 Plymouth Ct., Chicaso, 111
300
600
E. A. Rouleau.-
100
Chas. A. Rush
200
Wm. H. Johnston, St., and J. R. Johns-
ton, as trustees for—
Wm. H. Johnston and Anne E.
Johnston (husband and wife).
John A. Rush and I^ouise S. Rush
(husband and wife).
Wm. Joe Sears and Catherine W.
Sears (husband and wife).
Charles W. Bidwill and Violet M.
4,500
3,000
1,500
4,600
4,500
4.500
400
Bidwell (husband and wife).
John R. .Johnston and Anna
Vauchn Johnston (husband and
wife).
John Patton, Jr., and James J.
Patton.
E. J. Hart, Sr., and Ann Hart (hus-
band and wife).
2830 South Columbia PI., Tulsa, Okla...
1738 San Marco Blvd., Jacksonville, Fla..
1390 Southwest 17th St., Miami, Fla
Total -
3,000
30,000
68958— 50— pt. 1-
-51
792
ORGANIZED CRIMEI IN liSTTEBSTATE COMMERCE
Exhibit No. 169— Continued
Jacksonville Kennel Club, Inc., Jacksonville, Fla. — Statement of dividend checks
issued as of Jan. 10, 1948, on the Bamett National Bank
Name
Address
Number
of shares
Dividend
paid
Louis Z. Baya
Frederick H. Schultz.
John Z. Fletcher
Dorothy Hyland
R.J. Hart, Sr
George Sawyer, Jr
O. M. Todhunter...
J. H. Hysler
M. Cherry
Frank R. Anderson _
Don Anderson
Ethel Blumo
Eleanor Valz
Josephine Bennett- -
Aimie M. Hoflman.
Ruth D. Jennings
R. J. Hart, Jr .-
Richard T. Hart
Doris Hart
Ruth Cohn
William H. Johnston, Sr., and J. R.
Johnston, as trustees, for—
William H. Johnston
Anne E. Johnston
J. R. Johnston
Violet M. Bidwill
James and John Patton, Jr
Violet M. Bidwill
Harry Blattner
Mary Johnston
Jule Ann Johnston
Mary Rowan Johnston
William H. Johnston, Jr
735 Riverside Ave., Jacksonville, Fla
3044 Richmond Rd., Jacksonville, Fla..
1016 Barnptt Bid?., Jacksonville, Fla
1570 Mason Rd., Kirkwood, Mo
1390 Southwest 17th St., Miami, Fla
Trust department. Central Bank, Oakland,
Calif.
400 Lee St., Oakland 10, Calif
4719 Blackburn Rd., Jacksonville, Fla
1558 Ale.xandria PI., Jacksonville, Fla
Bo.-c 201, Belleville, 111
do
1038 Edgewood Ave., Jacksonville, Fla
3600 Riverside Ave., Jacksonville, Fla
9500 Carlysle Ave., Surfside, Miami Beach,
Fla.
Care of Carl T. Hoffman, Ingraham Bldg.,
Miami. Fla.
2849 Lydia St., Jacksonville, Fla
1390 Southwest 17th St., Miami, Fla
do
do
1539 Marco PL, Jacksonville, Fla
Total.
15 H
2
1
60
19
50
50
2
1
24%
5
10
24
12
100
50
3
3
3
20
186
201
166?^
100
200
66%
20
5
5
5
5
$620. 00
80.00
40.00
2, 400. 00
760. 00
2, 000. 00
2, 000. 00
80.00
40.00
986.66
20C.00
400.00
960.00
480. 00
4, 000. 00
2, 000. 00
120. 00
120. 00
120. 00
800.00
7,440.00
8, 040. 00
6. 666. 67
4, 000. 00
8, 000. 00
2, 666. 67
800. 00
200.00
200. 00
200.00
200.00
56, 620. 00
ORGATSriZED CRIMEl IN INTERSTATE COMMERCE
Exhibit No. 172
793
€bw Aiiri'fmrnl of &aii\
J X^'i~^^ _ * ^ «
WW '
all i'He iaiKt c 3<^3cr^oea if
? > 4 i - 'I
C s! ( » fc'vhan'flli'
7 o
794 ORGANIZED CRIME' IN INTERSTATE COMMERCE
Exhibit No. 172— Continued
/ '
i fet<-A Kt^'
ORGAlsnZED CRIMEi IN INTERSTATE COMMERCE 795
Exinmr Xo. ITl' < '(inlimu'il
• W « ^^■^*^'^^- "I
M,'
796 ORGANIZED CRIMEi IN INTERSTATE COMIVIERCE
ExHiiiiT No. 17:5
Tin:: ftKJ^TTCA*^ i€» %^ \l Haxic "^Sr
Til 1^: FiHST Xvi'ioNAi, llv>:?i ^V-''''
ORGAIS^IZED CRIME IN INTERSTATE COMIMERCE
Exiiii;!!' Nil. 173 — Continued
797
SUPPLEMENTAL DATA
The following correspondence is included in the record by order of
the chairman :
State of Florida,
Executive Department,
Tallahassee, Fla., August 8, 1950.
Mr. Rudolph Halley,
Chief Counsel, Speeial CovimiUee To Investigate Organized Crime in Inter-
state Commerce, Washington, D. C.
Dear Mr. Halley : Section 14.06, Florida Statutes 1941, autliorizes the Gov-
ernor of Florida to employ investigators. Such investigators are vested with
no law-enforcement powers. They may simply investigate.
Even hefore my inauguration as Governor of Florida on January 4, 1949, I
received reports of violations of law. After my inauguration such reports in-
creased, with requests for investigations.
Three investigators were employed for the Governor's office. One was E. A.
Garner, of Sarasota, Fla. He had been chief of police of Sarasota for many
years, and resigned to accept employment as investigator for my office. Mr.
Garner had been president of the Florida Peace Officers Association. I had
known him for many years.
J. J. Elliott, of Clearwater, Fla., also was employed as an investigator for the
Governor's office. He had been chief of police of Clearwater. I had known
him about a year.
W. O. Crosby, of Jacksonville, Fla., also was employed as an investigator.
He was a detective in the Jacksonville police department at the time, and ob-
tained a leave of absence to accept employment as an investigator for my office.
I had known him about 20 years.
These investigators were instructed to investigate law violations generally
and from time to time were assigned to specific eases to investigate. General
law enforcement in Florida is vested in elected county officials, the sheriff being
the chief law-enforcement official in each county. The investigators from my
office were instructed to report law . olations discovered by them to county
sheriffs and to request enforcement of the law.
During 1949 most of my time was taken up with two separate sessions of the
legislature, preparing the biennial State budget, and by a month in the hos-
pital. The administrative duties of my office were handled largely by my as-
sistants. The investigators from my office were directed by my assistants. I
talked with the investigators only a few times during 1949.
I have read the testimony given by W. O. Crosby to the Kefauver committee
at Miami, and I see nothing improper in it except that he made arrests. When
I learned he had been making arrests, he was instructed that the law gave him
no authority to make arrests. Testimony taken by the committee in Miami
shows he continued to report bookie violations to Sheriff Sullivan after March
1949, and that he was investigating at Miami Beach in March and April 1950.
Testimony shows that the sheriff's office of Dade County made 574 arrests in
1949 for violations of the gambling laws, as compared to only 279 such arrests
in 1948.
E. A. Garner, another investigator from my office, also investigated gambling
in Dade County and reported violations to the sheriff. He caused search war-
rants to be issued in February 1950 for a large number of bookie operations in
hotels at Miami Beach.
William H. Johnston has been my friend for about 15 years. He supported
me several times when I was a candidate for local office in Duval County. He
supported me when I was an unsuccessful candidate for Governor in 1940. He
supported me when I was elected Governor in 1948. I never heard or read
anything unfavorable about him until a few months ago. During the years I
798
ORGANIZED CRIMEI IN INTERSTATE COIMMERCE 799
knew him in Jacksonville lie was active in civic and charitable work and Vvas
generally regarded as a good citizen.
Mr. Johnston did not make cami)aign contributions to me pei'sonally. C. V.
Griftin had charge of the tinancing of my campaign for Governor in r.)48. It
was agreed between Mr. Grillin and me before the campaign began that he would
take charge of tlie linancing, and that I would have no part in it. I do not know
what campaign contributions Mr. Johnston may have made.
C. V. Grifhn and I have been friends during al)out 25 years, since we were
at the University of Florida. He supported me when i was candidate lor
Governor in liWO. He supported me when I was elected Governor in VMS. He
and his associate, the late Dodge Tayh)r, wrote the citrus plank in the plat-
form on which I was elected Governor. Mr. Griffin and Mr. Taylor were my
advisers on citrus legislation during the 1949 regular session of the legislature,
which enacted tiie Florida ('itrus Code.
Florida Governors long have followed the custom of appointing friends to their
personal staffs with the honorary rank of lieutenant colonel. I made many such
honorary appointments. Mr. Griffin was appointed to my personal staff with
the honorary rank of admiral. All such appointments were purely honorary.
The law gives such appointees no authority or power.
In July 1949 Mr. Griffin handed me a printed card designating him as chief
investigator, and asked me to sign it. He had had no training as an investi-
gator. He had been engaged in the citrus business for more than 20 years,
and had become Florida's leading grower of citrus. I understood the card to
be another honorary designation for him, and signed. Mr. Griffin did no investi-
gating for my office and received no salary from the State.
Seven months later, in February 1950, without mentioning it to me, Mr. Griffin
released a statement to the press saying he had been appointed chief investigator
and that I had requested liim to make an investigation of the State government.
I then revoked the carl which I had signed in July 1949. No one asked me to
revoke it. It was my own decision.
The Governor of Florida has no general law-enforcement power. The Con-
stitution and laws of Florida vest the power of general law enforcement in
elected county officials, the sheriff being the chief law-enforcement official in
each county. The Governor has no direct control over sheriffs or other county
law-enforcement officials. He cannot remove sheriffs and other county law-
enforcement officials. The Constitution of Florida vests power of removal in the
State senate. It gives the Governor only the power to suspend such officials
until the State senate convenes. If the State senate refuses to remove the
suspended official, he is reinstated and receives liis salary for the time he was
suspended. In only a few instances have Florida Governors suspended sheriffs.
and the State senate usually has refused to remove those suspended.
Florida has no State police force. The only agency under control of the
Governor with even limited law-enforcement power is the State beverage depart-
ment. Its powers are limited to enforcement of the beverage laws.
Gambling has been tolerated in Florida for many yeai's. Tlie seized records
of Frank Erickson show that he made $145,876.63 from bookie operations in
the Miami area in 1938-39. Erickson's records show that in 1944 his share
from bookie operations in Florida was $81,340.10. His records further show he
shared in a profit of $685,583.76 from bookie operations in Florida in 1945-46.
The gambling clubs named in the Kefauver committee's proposed report were
built and in operation long before I became Governor. Testimony taken by
the committee shows the S. & G. gambling syndicate had been in opei-ation for
years before I became Governor. The testimony indicates that the racketeers
named in the committee's proposed report had been carrying on gambling opera-
tions in Florida for many years before I became Governor.
Gambling had gained such a strong liold in Florida before I became Governor
that it was impossible to suppress all of it at once. Shortly after ray inaugura-
tion I directed sheriffis and other law-enforcement officers to strictly enforce
the law against slot machiines. A few weeks later I directed sheriffs and other
law-enforcement officers to strictly enforce the law against bookies. I also
requested the State racing commission to vigorously use its power, even though
very limited, against bookies.
The State beverage department was instructed to suppress bookies on licensed
beverage premises, its law-enforcement powers being limited to licensed beverage
preimises.
The regular session of the legislature convened 3 months after I was inaugu-
riated Governor. An antibookie bill had been defeated in two biennial sessions
800 ■ ORGANIZED CRIME IN INTERSTATE COIMMERCE
of the legislature before I became Governor. I endorsed the antibookie bill
which had been twice defeated. I formulated a plan to obtain its passage by
the le2;islature. It was passed and I signed it into law. Its enforcement was
vested in the attorney general and in the Florida Railroad and Public Utilities
Commission.
Next, I directed all county law-enforcement officials, including sheriffs, con-
stables. State attorneys, county solicitors, and prosecuting attorneys, to strictly
enforce all gambling laws, and to submit reports showing what they had done to
enforce the laws against gambling.
The proposed report of the Kefauver committee shows a gross income of
.$26,500,000 for the S. & G. Syndicate in 1948, but none since. My administration
did not begin until 1949.
Testimony taken by the committee in Miami shows that Frank Erickson paid
$40,000 for the l)ookie concession at the Roney Plaza Hotel in Miami Beach in
1947. That was before I became Governor. The State beverage department
made a raid on the bookie operation in the Roney Plaza Hotel shortly after
I was inaugurated Governor.
Testimony taken by the committee in Miami shows that John O'Rourke testified
his bookie operation in Palm Beach County was raided by the State beverage
department, and he was arrested, soon after my administration began.
Testimony taken by the committee in Miami shows that Sheriff Walter Clark,
of Broward County, received income from a bolita business in which he was a
partner during the years 1945, 1946, and 1947. That was, before I became
Governor.
Testimony taken by the committee in Miami also shows that Sheriff Sulliyan's
net worth of about $70,000 was accumulated before January 1, 1949, prior to my
becoming Governor.
I enclose an editorial by the Fort Myers News-Press on gambling in Florida.
Yours very truly,
FuixER Warren, Governor.
[From the Fort Myers (Fla.) News-Press, July 29. 1950]
Why All the Ruckus?
The uproar over gambling in Florida has administration officials at Tallahassee
a bit bewildered. How come, they ask, this sudden ruckus over a condition that
has been more or less prevalent — mostly more — for the past 20 years which are
within easy memory of old hands throughout the State?
Take, for example, the two previous administrations because they were strictly
high class and on the up-and-up in anybody's book. In spots recently under
scrutiny, and many others not in the current headlines, the gambling joints were
open wider when Spessard Holland — and Millard Caldwell were governors — and
they were just as high, wide, and handsome under Fred Cone and Dave Sholtz —
than they have ever been since Fuller Warren took over. This is common
knowledge among all who get around. It is admitted even by the star reporters
who have been writing things up for the newspapers that have joined in the
clamor.
If anybody doesn't believe that, the record is there to prove it, including the
record recently exposed by the Kefauver committee. When the books of Frank
Erickson, the Nation's biggest bookie, were seized by the Federal investigators,
his accounts showed that he made $145,876.63 from a single gambling operation
in the Miami area in 1938-39. Warren was not governor then. Erickson's rec-
ords aLso show that in 1944 his share was $81,340.10. That year Lieutenant
Warren was in connnand of a Navy gun crew hunting German subs in the
Atlantic. Erickson i-eally hit the jackpot with a piece of a $685,583.76 take in
1945-46. So lucrative was the patronage in tho.se days that he was able to pay
the Roney Plaza Hotel at Miami Beach $40,000 for the bookie concession at that
one spot in 1947. Warren had not got around to announcing for governor then.
He was iimugurated January 4. 1949, and Federal sleuths found nothing in the
Erickson records to indicate a Florida angle after that time.
The big fish in the Kefauver net was the S. & G. Syndicate which oi)erated
openly in Dade County gambling for many years. From its bookie operations
it grossed the hefty sum of $26,500,000 in 1948. But the Kefauver pi-obers dis-
closed nothing for 1949-.50. Fuller Warren was Governor during that period.
The evidence which caught up with Sheriff Clark, of Broward County, was
taken fi-om his income-tax returns for 194.5-46-^7, when Warren was not gover-
ORGANIZED CRIME' IX IXTERSTATE COMMERCE 801
nor. IninuHlintely after Clark liad admitted tliat he was still a partner in an
outfit which ran a bolita game (Jovernor Warren lired him.
The State beverage deiiartineiit was in existence during the Holland and
Warren administrations with the same iK)wers it lias been using to run slot
machines, ijunchboards and other forms of gand)ling out of iiublic places that
have liquor licenses. The c(tmmissioner under (Jovernor Holland, an upright man
who organized the department into an efficient agency for the collection of reveiuie
due the State, was asked by a Tallahassee reporter the otiier day what he had
done to suppress gambling. His answer was, "Nothing."
Governor Caldwell, it will be remembered, didn't fool with it. When local
crime connnissions and what not came to him with complaints he sent them home
to tell it to the grand .iury and t<dd them that if they didn't like the way the
laws were enforced all they had to do was vote the rascals out. That may not
liave been the best public iiolicy, but it left him free to administer the aifairs of
State without having to double in the .iustice-ctf-the-peace court.
On the credit side, Governor Warren has at least one major positive achieve-
ment that deserves to be i-ecognized. He vigorously backed the antibookie bill,
which had been defeated in two previous sessions of the legislature, and saw it
become a law. Enforcement powers were placed in the hands of tlie attorney
general and the utilities connnission. Both have taken energetic steps to enforce
the law. In the meantime the racing commission and the beverage department,
both under the Governor, have made continued craclvdowns on bookies within
the limited scojie of their authority.
No one will maintain that those who like to tal^e a chance on the numbers or
the ponies cannot get action here and there in the State in what is known to
the trade as "sneak" operations. But neither the Kefauver committee nor any
otlier prober has shown that sustained bookie operations liave been carried on
since Warren has been governor. As a matter of fact, any fair inquiry w'ould
show that under his administration the prevalence of gambling, and certainly the
volume, has been less than at any time since away back when the professionals
first got a foothold in Florida.
State of Florida,
Executive Department,
Tallahassee, Fla., August S, 1950.
Mr. Rudolph Halley,
Chief Counsel, Special Committee To Ini'estigate Orffavizcd Crime in
Interstate Commerce, Washington. D. C.
Dear Mr. Halley : As a supplement to the letter mailed you earlier this morn-
ing. I am enclosing a copy of a statement I made on February 18, 1949, little
more than a month after my inauguration.
Tours very truly,
Fuller Warren, Governor.
Statement by Fuller Warren, February 18, 1949
I am liberal minded. I believe in local self-government, and particularly in
local law enforcement. I am not a reformer, but I have an inescapable obliga-
tion to protect the revenue of Florida's State government. Unlawful bookmaking
on horse and dog races is depriving the State of millions of dollars of racing
taxes, it is estimated. In one county, alone, it is estimated that about 300 bookie
joints are operating. In this county money legally bet on horse races, from
which the State receives an 8 percent tax. is millions of dollars below what it was
last racing season. In spite of the fact that more tourists are in this county than
ever before, legal betting at races thei'e is steadily decreasing.
The State loses $8 on every $100 illegally bet with bookies. Every county in
Florida gets an equal share of the racing money. The old people of Florida
get 5 percent of the 8 percent tax on horse racing. Thus the (57 counties and
the 61.000 old people receiA^ing assistance are swindled every time a bet is placed
with a bookie.
The State of Florida is faced with a near financial crisis. State Comptroller
C. M. Gay has warned that there may not be enough money in the treasury to
pay salaries in July and August. The State government has been faced with
demands for .$100,000,(X)0 more during the coming 2 years than present taxes
will yield.
802 ORGANIZED CRIMEi IN INTERSTATE COMMERCE
Tax stealing by bookies must stop in tliis State. Accordingly, I aiu instructing
all sheriffs and constables to arrest all boolvie operators in tlieir counties and
districts. I have no authority over policemen but I urge them to assist in sup-
pressing these tax thieves.
I also am instructing State Beverage Director Lewis Sehott and Hotel Commis-
sioner James T. Landon to use their authority to the utmost against illegal book-
making. Mr. Schott's agents will be directed to fully enforce the law which
prohibits illegal bookmaking on premises licensed to sell alcoholic beverages.
Mr. Landon will instruct all hotels to forbid bookie operations on hotel premises.
I urge every citizen who wants the stealing of State taxes by bookies stopped
to inform law enforcement officers of any known bookmaking operations. If
bookies are allowed to continue to swindle the State of racing taxes, all citizens
may be burdened with additional taxes to i-eplace the lost revenue.
I urge judges who have been imposing light sentences on bookie violators to
pass sentences commensurate with tlie offense committed against tlie revenue
of the State.
State of Florida, Executive Departjient,
Tallahassee, August 9, 1950.
Mr. Rudolph Halley,
Chief Counsel, Special Cotn'mittee To Investigaie Organized Crime in
Interstate Commerce, Washington, D. C.
Dear Mr. Hallett: As a supplement to the comments previously sent you. I am
enclosing copy of my order of August 7 to all sheriffs and constables.
Very truly yours,
Fuller Warren, Governor.
State of Florida, Executive Department,
Tallahassee, August 7, 1950.
To All Sheriffs and Constables :
Tbe Coustitution of Florida pi'ovides that the Governor may suspend law-
enforcement officers for six causes, one of which is neglect of duty in office.
Neglect to enforce the laws against gambling constitutes neglect of duty in office
and therefore is a cause for suspension.
You are again directed to enforce, in your county or district, the laws of the
State of Florida against gambling. If, after 30 days from this date, to wit, after
September 6, 1950, I find that the gambling laws are not being enforced in
your county or district, I will presume that you are guilty of neglect of duty in
office, and an order of suspension will be made without a hearing. This does not
mean that you are not under the duty to enforce the laws against gambling during
the next 30 days. It means that I will not suspend any sheriff or constable,
before September 6, without a hearing.
The Constitution of Florida provides that the attorney general shall be the
legal adviser to the Governor. In order that no suspension will be made upon
legally unsound evidence for neglect of duty to enforce the gambling laws after
September 6, I will request Attorney General Ervin and his staff to examine and
pass upon the admissibility and legal sufficiency of all evidence submitted as to
such neglect of duty.
The constitution also provides that a suspended official may be reinstated by
the Governor upon satisfactory evidence that the cause or causes for which he
was suspended are untrue. Therefore, any sheriff or constable who may be sus-
pended, without a hearing, for neglect of duty to enforce the gambling laws after
September 6, will have an opportunity at a later date to prove that he was not
guilty of the neglect of duty for which he was suspended.
Fuller Warren, Governor.
State of Florida, Executive Dep.\rtment,
Tallahassee, August H, 1950.
Mr. Rudolph Halley,
Chief Counsel, Special Committee To Investigate Organized Crime in
Interstate Cotnmerce, Washington, D. C.
Dear Mr. Halley : As a supplement to the comments contained in my letter
of August 8, and to my letter of August 0, I am enclo.sing copy of my statement
of February 21, 1949.
Very truly yours,
Fuller Warren, Governor.
ORGANIZED CRIME' IN INTERSTATE COMMERCE 803
Statement by Fuller Wauren February 21, 1949
I am reluctant to intervene in local law enforcement. I believe deeply in the
right of the people to have the kind of local law enforcement they choose by
election of sheriffs and constables. My reading of history convinces nie that
human rights have suffered far more tlian they have benefited by remote control
of local law enforcement.
Despite this conviction, defiance of the law in Hillsborough County has be-
come so alarming that I have felt it my duty to do something about it. The
root of the trouble seems to have been the almost open and flagrant sale of
bolita for many years past. So far as I have been able to learn bolita has been
sold in Tampa for as far back as living people can remember. Apparently no
determined and sustained effort has ever been made to stamp it out. Political
races have been run with bolita as the issue. The outcome of such races has not
eliminated, nor apparently even lessened, bolita in Tampa. The seeming fact
that a majority of the people of Hillsborough County apparently have never
disapproved bolita has made me all the more reluctant to intervene.
Nevertheless, because bolita apparently has brought about a near breakdown
in law enforcement and danger of actual civil disorder in Tampa, I have decided
to move against it. I have directed Sheriff Hugh Culbreath to arrest every
bolita operator and peddler in Hillsborough County. He has assured me he wiU
do his full duty in this regard. I have assured him of outside help if he needs
it. If necessary, I will ask the FBI to intervene. I am ready to assign more
special investigators to Hillsborough County if required to eliminate bolita.
I would even go so far as to assign a unit of the State militia to Tampa, if it
became necessary. I will do whatever else may be necessary. But I doubt
that the job can be completely done by law-enforcement officials alone. I be-
lieve they will need the help of all citizens who want bolita abolished. There-
fore, I urge that citizens of Tampa take it upon themselves to turn up all known
bolita operators.
I am told several sporadic efforts in the remote past to suppress bolita in
Tampa failed. If this one also fails it likely will be a long time before another
attempt is made, so every citizen who wants this corrupting evil destroyed
ought to do his utmost now.
Cleveland, November 6, 1950.
Hon. EsTES Kefau\'er,
Chairnuni of Committee of the United titates Senate To Investigate
Interstate Criminal Activities,
Senate Office Building, Wasliington, D. C.
Dear Senator Kefauver: The transcript of the proceedings conducted by
your committee at Miami, Fla., on July 13, 14, and 15, 1950, quotes you as saying
in your preliminary remarks that —
"The committee does not wish to do any innocent citizens any harm. If in-
advertently any harm is done, we want to rectify it as quickly as possibly. * * *
if any person whose name is used * * * feels that he has been maligned or
unjustly accused * * * or if they want to charge that any statement that
has been made is untrue * * * jf they make application to the committee or to
our staff and give them an opportunity to make any explanation or to refute any
charges that have been made, they can feel at perfect liberty to get in touch
with any of us about it."
As one innocent citizen who has been seriously harmed by the completely un-
founded testimony relating to me given by Mr. Daniel P. Sullivan, I avail
myself of your invitation and urgently request that your conunittee take im-
mediate steps to correct the transcript and I herel)y offer to appear before your
committee and to present evidence under oath that will completely refute the
charges and innuendos made about me.
To lay a foundation for the fairness of my request I shall summarize briefly
the testimony of Mr. Sullivan relating to me, how it has been interpreted by our
local newspapers, how utterly false they are, what my busine.ss associations and
reputation have been, and the irreparable economic, social, and personal harm
that I have sustained.
On page 56 of the transcript, Mr. Sullivan testified as follows :
"Max Marmorstein is a hotel operator from Cleveland, Ohio. He maintains
his office in the Ninth and Chester Building in Cleveland, Ohio, and his tele-
phones were taken out of that office in 1943 because they were connected with
804 ORGANIZED CRIME IN INTERSTATE COMMERCE
gambling operatlcm. That building is the headquarters of the Empire News
Service controlled by Mussy Wexler."
On i>age 57 he further testified as follows :
"Subsequent to 1941 Otto Lorentzen, a nephew of John Angersola, John Car-
done, another relative of John Angersola, Abe Allenber, Max Marmorstein, John
Angersola, and a brother, Fred Angersola. and Anthony Carfano were set out as
being partners in the operation of that hotel. Carfano himself signed cor-
respondence from the liotel as managing director. The hotel thereafter became a
meeting place for well-known racketeers and gangsters from all over the
country."
Obviously based on that testimony the i^rinted interim rejwrt of your com-
mittee, No. 2370, lists my name on one of the charts in a box under "Wofford
Hotel," which is connected with a smaller box, captioned "Erickson Agents."
The Cleveland Plain Dealer, on August 20, reported on this information as
follows :
"Max Marmorstein, Otto Lorentzen, and John Cardone, all listed with John
Angersola as gambling agents for Erickson in the Wofford Hotel."
The above testimony and interpretation of it are utterly false. I have been
engaged in the real-estate business, si)eci;ilizing in hotels, for al)out 80 years.
During that period I have represented many important individuals, corpora-
tions, and banks who were interested in hotels and. in several instances, I was
consulted by representatives of the United States Government to advise it on
hotel operation, the last one involving a tax difficulty with the Connuodore Perry
Hotel in Toledo.
One of the companies that I have represented for about 30 years is Albert
Pick Co.. which at one time was interested in 82 hotels, including the May-
flower at Washington, the Roosevelt at New York, the Book-Cadillac at D;^troit,
and many others. Since 1S22 I have been retained l>y that company, and liy the
banks which once controlled it, as a consultant on their hotel operations.
The above are only a few of the hotel operators whom I have represented and
advised. I .shall be glad to furnish the conunittee with the names of many others.
I have also built many hotels, and during the past 10 years I built approximately
800 houses under FHA regulations.
Because of my reiiutation as an expert in hotel operation John King phoned
me from IMiami Beach in January 1041 and asked me to advise him about some
problems he had with the Wofford Hotel and also with the Ilaleigh Hotel, then
nearing completion. I met him in Florida in February 1041 and I undertook
to supervise the operation of the hotels until tlip various prolilems were ironed
out. This took several months, at the end of which I withdrew from all further
participation in them. My services consisted entirely of acting as adviser and
consultant about the management of the property, for which I received a modest
fee.
The testimony that I was a partner with Cardone and others in the hotels
is untrue. I was never a partner with anyone in the hotels and I never even
met Cardone. The innuendo that I was an "Erickson agent" is completely with-
out foundation. During the time I was rendei'ing services for the Wofford neither
Erickson nor any of the others named by Mr. Sullivan had an offive there, no
one ever mentioned Krickson's name to me and I never met him.
The testimony that my telephone was taken out of my office in the Ninth and
Chester Building in 1943 because they were coiniecfed with g-uubling operations
was not only fantastically false but utterly irresiKnisible and reckless because
the most superficial investigation would have disclosed its falsity. I did not
move into the Ninth and Chester Building until January 1, 194."). My telei4iones
were never disconnected in any office. INIy best recollection is that Empire News
Service was a tenant in the building when I took over its management in Jan-
uary 194."). and it has continued as a tenant, occupying a small office of approxi-
mately 22.") square feet of .space since that time — so far as I knew there was no
valid re'son to require it to leave the building. The tenants in the building in-
cluded representatives of a numlier of hiuh-grade firms as well as several agen-
cies of the Federal (iovernment, which ag«Micies occupy about 12.000 square feet
of space in the building.
These fal.-^e charges and Innuendos have not only seriously damaged my char-
acter and reputation, caused deep hunnliation to me and my family, subjected
us to .social ostracism. I)ut caused s])ecilic (M-oiiomic losses in several respects
which I shall be glad to disclose to the conunittee. Much of this damage can
no longer be undone but. in the name of fair play, the comnuttee should do every-
thing within its power to rei)air this injury as far as that can be done.
ORGANIZED CRIME: in DSTTERSTATE COMMERCE 805
I trust with this explanation you will be able to correct your records and the
transcript of the testimony to accord with these facts. Please be assured that
I shall be glad to supply you with any further information concerning me or
my activities which you may care to liave.
Thanking you in advance for your interest, I am
Respectfully yours,
Max Makmorsteix.
X
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