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Full text of "Investigation of organized crime in interstate commerce. Hearings before a Special Committee to Investigate Organized Crime in Interstate Commerce, United States Senate, Eighty-first Congress, second session, pursuant to S. Res. 202 .."

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Given By 



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U, S. S: 



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INVESTIGATION OF ORGANIZED CRIME 
IN INTERSTATE COMMERCE 



HEARINGS 

BSFORB THB 

SPECIAL COMMITTEE TO INVESTIGATE 

ORGANIZED CEIME IN INTERSTATE COMMERCE 

UNITED STATES SENATE 

EIGHTY-FIRST CONGRESS 

SECOND SESSION 
AND 

EIGHTY-SECOND CONGRESS 

FIRST SESSION 
PURSUANT TO 

S. Res. 202 

(81 st Congress) 

A RESOLUTION AUTHORIZING AN INVESTIGATION OF 

ORGANIZED CRIME IN INTERSTATE COMMERCE 



PART 10 



NEVADA-CALIFORNIA 



NOVEMBER 15, 16, 17, 18, 20, 21, 22, 27, AND 

DECEMBER 13, 1950; FEBRUARY 27, 28, AND 

MARCHI2, 3, 1951 



Printed for the use of the Special Committee To Investigate 
Organized Crime in Interstate Commerce 

I- 

X 





INVESTIGATION OF ORGANIZED CRIME 
IN INTERSTATE COMMERCE 



,,. . c -p HEARINGS 

UO^^I^CSSS**^'^' BEFORE THE 

SPECIAL COMMITTEE TO INVESTIGATE 

OEGANIZED CEIME IN INTEKSTATE COMMEECE 

UNITED STATES SENATE 

EIGHTY-FIRST CONGRESS 

SECOND SESSION 
AND 

EIGHTY-SECOND CONGRESS 

FIRST SESSION 
PURSUANT TO 

S. Res. 202 

(81st Congress) 

A RESOLUTION AUTHORIZING AN INVESTIGATION OF 

ORGANIZED CRIME IN INTERSTATE COMMERCE 



PART 10 



NEVADA-CALIFORNIA 



NOVEMBER 15, 16, 17, 18, 20, 21, 22, 27, AND 

DECEMBER 13, 1950; FEBRUARY 27, 28, AND 

MARCH 2, 3, 1951 



Printed for the use of the Special Committee To Investigate 
Organized Crime in Interstate Commerce 




UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHINGTON : 1951 



PUBLIC 



IL S. SUPERINTENDENT OF DOCUMENTS 

MAY 18 1951 



SPECIAL COMMITTEE TO INVESTIGATE ORGANIZED CRIME IN 
INTERSTATE COMMERCE 

ESTES KEFAUVER, Tennessee, Chairman 
HERBERT R. O'CONOR. Maryland CHARLES W. TOBEY, New Hampshire 

LESTER C. HUNT, Wyoming ALEXANDER WILEY, Wisconsin 

RUDOLPH Halley, Chief Counsel 

n 



CONTENTS 



Testimony of — Page 

Ahem, Frank, inspector, police department, San Francisco, Calif. _ 489-503 

Alioto, Joseph L., attorney, San P>ancisco, Calif 418-419' 

Anderson, Clinton H., chief of police, Beverly Hills, Calif 713-720 

Baker, William P., president, Regal-Amber Brewing Co., and vice pres- 
ident, California State Brewers' Institute, San Francisco, Calif, _ 988-994 

Bircher, Donald O., tax consultant, Glendale, Calif 326-336 

Biscailuz, Eugene Warren, sheriff, Los Angeles County, Calif 279-304 

Blom, Rex, Palos Verdes, Calif 1026-1035 

Bompensiero, Frank, San Diego, Calif 336-345 

Bonelli, William G., member of the fourth district. State board of 

equalization, Calif 771-82 & 

Bowron, Hon. Fletcher, mayor, Los Angeles, Calif 657-664 

Brown, Edmimd G., district attorney, San Francisco, Calif., accom- 
panied by Thomas C. Lvnch, chief assistant district attorney, San 

Francisco, Calif 4 19-446' 

Bucher, Carroll S., attorney, San Francisco, Calif., accompanied by 

Thomas J. Riordan, attorney, San Francisco, Calif 1054-1058, 

1101-1102, 1128-1131 

Burkett, William A., Sacramento. Calif 518-551, 610-631 

Burt, W. L., tax consultant. Long Beach, Calif 305-312 

Butler, George, lieutenant, police department, Dallas, Tex 936-952 

Cahill, Thomas, inspector, police department, San Francisco, Calif __ 489-503 

Clark, Wilbur Ivern, Las Vegas, Nev 52-64 

Cohen, Michael (Mickey), Los Angeles, Calif., accompanied by 
William Strong and Benjamin E. Schwartz, attorneys, Beverly 

Hills, Calif 194-278 

Cohen, Stanle}^ San Francisco, Calif., accompanied by Leo Friedman, 

attorney, San Francisco, Calif 1036-1051 

Contratto, James J., Las Vegas, Nev 373-374 

Dalitz, Morris, Detroit, Mich., accompanied by Charles Carr, at- 
torney, Los Angeles, Calif 907-928 

Davies, Charles E., special agent, Intelligence Unit, Bureau of Internal 

Revenue, United States Treasury Department 607-631 

English, James, chief of inspectors, San Francisco Police Department- 489— 

503 

Entenmann, Carl, Glendale, Calif 762-766 

Entenmann, Norman, Glendale, Calif 762-766 

Feenev, Thomas E., attorney, San Francisco, Calif 446-447 

Gentry, Dale, San Bernardino, Calif 861-868, 872-878 

Georgetti, Emilio, Summit Hill, Calif., accompanied by Eugene 

Meacham, attorney, Washington, D. C 633-651 

Glasser, Irving, Los Angeles, Calif 360-362, 375-394, 827-861 

Gould, Polly, Los Angeles, Calif 904-906 

Greeson, L. R., chief of police, Reno, Nev 48-52 

Guasti, Al, formerly captain in the sheriff's office, Los Angeles County, 

Calif 312-325, 688-712 

Hamilton, Capt. James E., head of intelligence department, adminis- 
trative bureau, Los Angeles Police Department 164-172, 720-742 

Hamilton, James G., secretary, California State Brewers' Institute, San 

Francisco, Calif 968-988, 1109-1110, 1210-1211 

Hartmann, Martin, San Francisco, Calif 1084-1101 

Hill, Carey S., Los Angeles, Calif 667-680 

Hoertkorn, Harold T., certified public accountant, San Francisco, 

Calif 1051-1054, 1102-1105, 1204-1214 

Holleran, Charles, manager, Horseshoe Club, Gardena, Calif 878-880 

Jewell, Arthur C, under sheriff, Los Angeles County 108-132 

Jones, Clifford, Lieutenant Governor, State of Nevada 25-34, 38-41 



IV CONTENTS 

Testimony of — Continued Page 

Kaltenborn, Robert J., Las Vegas, Nev 94-103 

Kessel, David N., Piedmont, Calif., accompanied by Harold Faulkner, 
attorney, and Messrs. Pechart and Mathewson, San Francisco, 

Calif 464-48^ 

Krause, Allan, San Francisco, Calif 1 140- 1 147 

Lawry, Fred L., assistant special agent, Bureau of Internal Revenue, 

United States Treasury Department 607-631 

Lubbes, Charles B., San Francisco, Calif 1002-1012 

Matranga, Mrs. Maria, Los Angeles, Calif., accompanied by Frank 

Desimone, attorney, Los Angeles, Calif 953-954 

Miller, Hyman, Los Angeles, Calif 363-368, 397-416 

Mitchell, Michael, chief of police, San Francisco, Calif 489-503 

Mooney, Patrick, Sr., formerly chief field deputy. Bureau of Internal 
Revenue, Reno, Nev., accompanied by Patrick Mooney, Jr., 

accountant, Reno, Nev 1_ 1063-1082 

Moore, William J., Las Vegas, Nev 2-25, 37-38 

Palmer, C. H., counsel for the Alfred Hart Distilleries, Inc., Los 

Angeles, Calif 1131-1139 

Parker, William H., chief of police, Los Angeles, Calif 164-172, 720-742 

Pechart, Walter, El Cerrito, Calif., accompanied by Mathewson and 

Faulkner, attorneys 505-5 18 

Philbrick, Howard R., Central Casting Corp., Los Angeles, Calif. _ 750-759 

Phillips, Henry, Las Vegas, Nev 34-38 

Picard, Henry K., vice president and general manager, San Francisco 
Brewing Co., and G. L. Fanning, vice president, Lucky Lager 

Brewing Co., San Francisco, Calif 994-996 

Prunty, Jolin, Prunty Insurance Co., Fresno, Calif., accompanied by 

Kenneth L. Say, attorney, Fresno, Calif 1012-1025 

Quattrin, Sante, executive secretary. Wholesale Liquor Distributing 

Association of Northern California, Inc., San Francisco, Califs 996-1002 

Randolph, Mrs. Lucille W., city clerk, Gardona, Calif 749-750, 75i)-762 

Reid, Ralph R., retired special agent, Intelligence Unit, Bureau of 

Internal Revenue, United States Treasurv Department 607-631 

Robertson, William L., Seal Beach, Calif-..' 368-373, 552-569 

Rogers, Donald B., group leader, Bureau of Internal Revenue, United 

States Treasury Department 607-631 

Rotondo, Casper, Jr., Los Angeles, Calif ..._ 362-363 

Rotondo, Casper, Sr., San Bernardino, Calif 362-363 

Ruditsky, Barney, Los Angeles, Calif 179-193 

Russell, Floyd, San Francisco, Calif., accompanied by James Davis, 

attorney, San Francisco, Calif 448-464 

Sackman, Harry, accountant, Beverly Hills, Calif 144-164 

Sanford, Holden, special agent. Internal Revenue Bureau, San 
Francisco, Calif., accompanied by \\'alter M. Campbell, regional 
counsel. Penal Division, Bureau of Internal Revenue, San Francisco, 

Calif 1058-1063, 1110-1128 

Samish, Arthur H., San Francisco, Calif. __ 963-967, 1105-1108, 1161-1222 

Schmid, Walter R., Orange County, Calif 766-770 

Schino, Ernest M. (Mike,', former chief field deputy, office of collector 
of internal revenue. Northern District of California, San Francisco, 
Calif., accompanied by Emmet Hagerty, attorney, San Francisco, 

Calif 579-593, 612-631, 1147-1161 

Sedway, Moe, vice president Hamingo Hotel, Las Vegas, Nev 64-94 

Sica, joe, Burbank, Calif., accompanied by Russell E. Parsons, 

attorney, Los Angeles, Calif 888-894 

Simpson, William Edward, district attorney, Los Angeles County. _ 132-141 
Smiley, Allen, Los Angeles, Calif., accompanied by Otto Christensen, 

attorney, Los Angeles, Calif 894-904 

Smvthe, James, collector of internal revenue for the First District of 

California 593-631 

Stocker, James, Big Bear Lake, San Bernardino County, Calif., accom- 
panied b}- Milan Medigovich, attorney, Los Angeles, Calif 869-878 

Tolin, Ernest, United States attorney for southern California, Los 

Angeles, Calif 325-326 

Tucker, Samuel, the Desert Inn, Las Vegas, Nev., accompanied by 

Charles Carr, attorney, Los Angeles, Calif 929-935 



CONTENTS V 

Testimony of — Continued Page 

Utley, James, Hollywood, Calif 345-360, 880-888 

Wiener, Louis, attorney, Las Vegas, Nev 41-48 

Wolcher, Louis, San Francisco, Calif., accompanied by Ralph Taylor 

and Conrad Hubner, attorneys, San Francisco, Calif 569-579 

Schedule and summary of exhibits v 

Wednesday, November 15, 1950 1 

Thursday, November 16, 1950 105 

Fridav, November 17, 1950 179 

Saturdav, November 18, 1950 305 

Mondav, November 20, 1950 375 

Tuesday, November 21, 1950 (Los Angeles, Calif.) 395 

Mondav, November 27, 1950 (Los Angeles, Calif.) 397 

Tuesday, November 21, 1950 (San Francisco, Calif.) 417 

W^ednesday, November 22, 1950 (San Francisco, Calif.) 505 

Wednesdp.v, December 13, 1950 633 

Tuesday, February 27, 1951 653 

Wednesday, Felmiary 28, 1951 827 

Fridav, March 2, 1951 959 

Saturday, March 3, 1951 1083 

Appendix 1225 

Supplemental data 1229 

SCHEDULE OF EXHIBITS 



Number and summary of exhibits 



Intro- 
duced on 
page — 



Appears 

on 
page — 



1. Digest of racing wire situation in Las Vegas. Nev 

2. Memorandum for committee on certain licensed gambling 

operations in Nevada 

3. Letter to the committee from Sheriff Biscailuz, together with 

data of arrests and reports of his office 

4. Card given Accountant Sackman by Mickey Cohen re loan... 

5. Sheet of paper re loan to Mickey Cohen from J. W. Federman. 

6. Notation by Accountant Sackman that Cohen phoned re his 

loan from Bernard Cohen 

7. Notation, December 19, 1950, Cohen received $25,000 from 

Federman, and. September 14, won $2,380 on horses 

8. Photograph of Mickey Cohen, two policemen, Russell Par- 

sons, Jimmy Rist, and Eli Rubin 

9. Set of five photographs, taken at the time of Cohen's arrests.. 

10. FBI record of arrests and convictions of James Rist 

11. FBI record on Joseph Sica 

12. FBI record on David Ogul 

13. FBI record on Eli Lubin, alias Jerry Martin 

14. FBI record on Michael Cohen, alias Mickey Cohen 

15. Report to Sheriff Biscailuz from C. H. Pearson, captain, anti- 

vice and narcotics detail, dated February 14, 1950 

16. Outline of activities of Sheriff Biscailuz' antigangster squad, 

dated November 6, 1950 

17. Memorandum of Richard Hyer of San Francisco Chronicle, in 

response to a questionnaire sent by the committee to edi- 
tors 

18. Article in San Francisco News, November 17, re committee's 

power to examine income-tax returns 

19. Oakland Tribune article, November 17, re the committee 

20. Series of articles in California newspapers re the committee.. 

21. Letter to the committee, dated October 16, 1950, from the El 

Cerrito Group Committee 

22. News article from San Francisco News of November 17, en- 

titled "Kefauver Group Will Check San Francisco Figures' 
Tax Returns'' 

23. Article from Oakland Tribune of November 17 re witnesses 

facing quiz on the juggling of taxes 

Footnotes on p. VII. 



25 



127 
145 
145 

145 

145 



420 

466 
468 
469 

487 



506 
507 



(0 



25 (1) 



0; 
(2) 
(') 

{') 

(^) 



215 


0) 


215 


(') 


217 


n 


217 


(') 


218 


(1) 


218 


0) 


218 


(>) 


281 


(') 


282 


0) 



0) 
0) 

(3) 
(1) 



0) 

(0 



VI 



CONTENTS 
SCHEDULE OF EXHIBITS— Continued 



Number and summary of exhibits 



Intro- 
duced on 
page 



24. Additional news clippinsis submitted by Walter Pechart re tax 

returns investisiation by Committee 

25. Statement of Gertrude Jenkins, given at Tehachapi, Calif., 

June 27, 1950 

26. Photostats marked "Slots," in San Mateo County, Calif. 

27. Statement, dated .'Vpril 15, 1948, of Patrick Mooney, re prep- 

aration of Elmer F. Remmer's tax returns 

28. List of duties of Chief, Field Division, Bureau of Internal 

Revenue, submitted by Michael Schino 

29. Pan 3 of <he report of the California Crime Commission, re 

Internal Revenue Department 

30. Miscellaneous Document No. 58, filed in the United States 

Supreme Court (Earl W. Taylor charges conspiracy exists 
to cau.se him to be illegally imprisoned) 

31. Communications addressed lO vhe committee from the district 

attorney, Dallas, Tex., with respect to Benny Binioa 

32. A report of the subconunitvee of the Attorney General's Con- 

ference on Organized Crime 

S3. Report of grand jury, Los Angeles County: jury foreman, 
Carey S. Hill 

34. Papers submitted by Captain HamiPon, re Plaza Bridgo, in- 

cluding photosrat of application for license, dated June 30, 
1949, signed by Gilbert Brown as sole owner and opera or; 
record of Marvin Brown and James Contratto 

35. Phovostals of ;he applications of Irving Glasser for licenses for 

Fortune Bridgo and Rose Bridgo 

36 Committee staff report on poker parlors at Gardena, Calif 

37. I^ntire reijon of Kdwiii N. Aiherton and Associates, identified 

by Howard R. Pliil brick 

38. Ordinances of i he city of Gardena, Calif., submitted by Lucille 

W . Randolph, city clerk ._. 

39. Conclusions bv Hon. William J. Palmer, judge, department 4, 

Superior Court No. 79,024 

40. Photostat of articles of incorporation of California State 

Brewers' Association 

41. Copy of agreement between Arthur Samish, California State 

Brewers' Association, and certain named individual brewers 
members of association 

42. Transcript of ledger sheets re Authur Samish, special account 

in Crocker First National Bank 

43. Copy of minutes of California State Brewers' Institute direc- 

tors' meetings of January 8 and February 7, 1951 

44. Copy of itemization of checks and canceled checks, submitted 

by Charles B. Lubbes 

45. Letter from Acting Commissioner Fred S. Martin, Office of 

Commissioner of Internal Revenue, to Senator Kefauver, 
dated February 16, 1951 

46. Photo of Hueneme Hotel, Hueneme, Calif 

47. Photostat of check dated August 16, 1948, payable to Mac 

Gilson and Morris (Jovtlied for $10,000, signed by John 
Prunty 

48. Subpena directed to Stanley Cohen 

49. Copy of list of purchasers of Mountain City Consolidated 

Copper Co. stock, July 9, 1943, to May 1946 

50. Photostat of agents' working papers of schedule of stock cer- 

tificates issued by Mountain City Consolidated Copper Co. 
for period from September 1947"to March 31, 1949 _-. 

51. Copy of a progress report on current operations of Mountain 

City Consolidated Copper Co., reproduced from the Reno 
Evening Gazette 




518 
581 
596 

606 
635 
659 
668 

722 

722 
735 

751 

759 

805 

968 

976 

976 

982 

1009 



1010 
1015 



1015 
1043 

1077 



1082 



1094 



Footnotes on p. VII. 



C'ONTETNTS 
SCHEDULE OF EXHIBITS— Continued 



VII 



Number and summary of exhibits 



Intro- 
duced on 
page — 



Appears 



52. Analysis of public-relations fund, dated September 30, 1949.-. 

53. Copy of letter dated January 21, 1944, ':o Stanley Baar, exec- 

utive vice president of Allied Liquor Industries, from Arthur 
H. Samish 

54. Copy of letter to Herbert J. Charles, president, United States 

Brewers' Association, from Arthur H. Samish 

55. Copy of In the Public Welfare, 1942, issued by public relations 

department, California State Brewers' Institute 

56. Copy of letter dated October 6, 1950, to alcoholic beverage 

industry from Arthur H. Samish 

57. Copies of news letters issued by Samish & Associates, dated 

January 4, 11, 18, 25, and February 1, 8, and 21 

58. Copy of West Coast Brewer, dated February 1951 

59. Copy of digest of bills amending Motor Vehicle Act or affect- 

ing highway transportation 

60. Copy of miscellaneous legislation and constitutional amend- 

ment proposals 

61. Copy of listing and digest of assembly and senate bills, pro- 

posing changes to Alcoholic Beverage Control Act 

62. Photostat of letter dated March 15, 1948, from Tony Monti to 

Arthur H. Samish 



1105 



0) 



1166 




1166 




1173 




1174 




1174 
1174 




1175 




1175 




1175 




1217 





1 On file with committee. 

2 Returned to witness. 
' Written into record. 



SUPPLEMENTAL DATA 



Page 

1. Letter dated November 20, 1950, to Senator Kefauver from Donald O. 

Blrcher, tax consultant, Hollywood, Calif 1229 

2. Letter dated January 9, 1951, to Senator Kefauver from W. J. Moore, 

Jr., executive vice president. Hotel Last Frontier, Las Vegas, Nev 1229 



IISYESTIGATION OF ORGANIZED CEIME IN INTEESTATE 

COMMERCE 



WEDNESDAY, NOVEMBER 15, 1950 

United States Senate, 
Special Committee To Investigate 
Organized Crime in Interstate Commerce, 

Las Vegas, Nev. 
confidential 

The committee met, pursuant to call of the chairman, in Las Vegas, 
Nev., at 10 a. m.. Senator Estes Kefauver (chairman) presiding. 

Present: Senators Kefauver, Tobey, and Wiley. Also present: 
Rudolph Halley, chief counsel ; H. G. Robinson, associate counsel and 
chief investigator; William G. Ruymann, special counsel; Herbert 
Van Brunt, special representative to the committee; Julius Cahn, 
administrative assistant to Senator Alexander Wiley. 

EXECUTIArE session 

The Chairman. Do you have a resolution prepared, Mr. Halley? 

Mr. Halley. Could we have a resolution in the record that one of 
the committee members would propose such a resolution, to read as 
follows : 

That the chairman is hereby authorized to hold at his discretion subcommittee 
meetings in the States of Nevada and California, to appoint proper subcom- 
mittees to meet in the States of Nevada and California, and that such subcom- 
mittees may consist of one or more members of the committees, and that one 
committee member shall constitute a quorum for the purpose of swearing wit- 
nesses, taking testimony, and all other business pertinent to the hearings of this 
committee. 

Senator Wiley. Move for the adoption of the resolution. 

The Chairman. Second the motion ? All in favor say "Aye." Let 
it be known by saying "Aye." 

Let the record show that the motion was made by Senator Wiley, 
seconded by Senator Tobey, unanimously passed by Senators Wiley, 
Tobey, and Kefauver. 

The Chair designates subcommittee consisting of Senators Tobey, 
Wiley, and himself to hold hearings in the State of Nevada and the 
State of California, and also the Chair may appoint, as set forth in 
the resolution, one member of such subcommittee to swear witnesses 
and to take sworn testimony. 

Anything else for the record that we need ? 

Mr. Halley. Nothing. 



2 ORGANIZED CRIME IN INTERSTATE COMMERCE 

TESTIMONY OF WILLIAM J. MOOEE, LAS VEGAS, NEV. 

The Chairman. Mr. Moore, do you solemnly swear the testimony 
you Avill give this committee will be the truth, the whole truth, and 
nothing but the truth, so help you God ? 

Mr. Moore. I do. 

Mr. Halley. Mr. Moore, your full name is William R. Moore? 

Mr. ]MooRE. William J. Moore. 

Mr. Halley. What is your address ? 

Mr. Moore. 710 South Eighth Street, Las Vegas, Nev. 

Mr. Halley. What is your occupation? 

Mr. Moore. Hotel executive. 

Mr. Halley. With what hotel are you connected? 

Mr. MooRE. Hotel Last Frontier. 

Mr. Halley. Do you hold any public office in the State of Nevada? 

!Mr. INIooRE. I am a member of the Xevada Tax Commission. 

Mr. Halley. How long have you been a member of that commis- 
sion ? 

Mr. Moore. Approximately three and a half years. 

Mr. Halley. Are you chairman of that commission ? 

Mr. MooRE. No. 

INIr. Halley. Have you ever been chairman? 

Mr. ]\IooRE. No. 

Mr. Halij:y. Mr. Moore, are you acquainted with the history of 
the investigation conducted in the State of Nevada which resulted 
in the passage of the race wire service law which became effective 
July 1, 1949^ 

]\fr. Moore. Yes. 

Mv. Halley. Would you tell the committee what led to the hold- 
ing of hearings regarding the race-wire law in the State of Nevada, 
what facts and circumstances led to it, and in general describe the 
proceedings which were held ? 

Perhaps, first you should state the position you held and the part 
you took in those proceedings. 

Mr. Moore. At the time the proceedings took place, I was acting 
as a member of the Nevada Tax Commission representing business. 
I was appointed to the Nevada Tax Commission before the legislature 
turned the administration of the issuance of licenses and control of 
gambling over to the tax commission. 

Serving as a member of this Nevada Tax Commission, we received 
a letter from the local district attorney stating that conditions were 
bad in the race horse book business in Las Vegas. 

^Ir. Halley. You are referring to Robert E. Jones ? 

ISIr. INIooRE. Yes. 

Mr. Halley. District attorney of Clark County? 

Senator Wiley. When you say "local," do you mean the Federal 
or the State? 

Mr. Moore. County attorney. 

ISIr. Halley. He wrote on approximately, would you say, October 
23, 1948, or thereabouts ? 

Mr. MooRE. I do not remember the date, but we did receive a letter 
from Robert E. Jones. 

ISIr. Halley. Did he state that the situation was fraught with 
danger to the public peace ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 3 

Mr. Moore. Yes. 

Mr. Halley. And he pointed out that the condition could result in 
very unfavorable publicity to the State of Nevada, did he not, sir? 

Mr. Moore. As I remember, yes. 

Mr. Halley. Can you state what led to such a letter on the part 
of the district attorney? About a year previously a man named 
Benjamin Siegel had been killed ; is that correct ? 

Mr. Moore. Yes. 

Mr. Halley. Was he not one of the owners of the Flamingo Hotel ? 

]Mr. Moore. Yes. 

Mr. Halley. Do you know what other interests he had in the State 
of Nevada ? 

Mr. ]\IooRE. To my knowledge, he owned an interest in the race 
book in the Golden Nugget, and several other race books in the 
community. 

Mr. Halley. Did he not also have an interest in the racing wire 
service ? 

Mr. MooRE. At one time I believe he attempted to establish his 
own service. 

Mr. Halley. Did not your hearing show that he exercised consider- 
able powers over the decision as to who would have racing wire 
service in the Las Vegas area ? 

Mr. Moorns,. Yes. 

]Mr. Halley. Following his assassination in 1947, was there a period 
of flux, particularly in and about the city of Las Vegas, with regard 
to the racing wire service ? 

IMr. MooRE. What do you mean by "flux" ? 

Mr. Halley. Well, things were unsettled, weren't they ? 

]Mr. Moore. Yes. 

]\Ir. Halley. Was it that which led the district attorney to feel that 
there might be an outbreak of gang warfare ? 

]Mr. Moore. I presume so. 

Mr. Halley. What do you know of your own knowledge, Mr. 
Moore, of it? 

Mr. Moore. To my own knowledge, I knew very little because at 
that particular time we did not have a race-book operation in the 
hotel. However, I can only state what I was told by numerous opera- 
tors that Mr. Siegel said who was to get race-book service and who 
was not to get it. 

Mr. Halley. Those whom he said could not have it just didn't get 
it; is that what occurred? 

Mr. Moore. They didn't get it, and some of them were very un- 
happy about it, and from time to time probably went to the district 
attorney to put in their gripes. 

Mr. Halley. Would you say that it became known that in return 
for giving people race wire service, Siegel would demand an interest 
in the proceeds of such service? 

JSIr. IMooRE. I believe the hearing pointed that out. 

Mr. Halley. In other words, he seemed to have the say-so on who 
would get the wire service ; is that right so far ? 

;Mr. Moore. That is right. 

]\Ir. Halley. And those who got it would have to allow him to par- 
ticipate in the profits of their racing book? 



4 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Moore. That is what the hearing brought out; yes. 

Mr. Halley. So the people who were not getting such service were 
bitterly opposed to Siegel ; is that right ? 

Mr. Moore. Yes. 

Mr. Halley. After Siegel's death, a man named Rosen, Benjamin 
Eosen, came to Las Vegas; is that right? Morris Rosen? 

Mr. Moore. Morris Rosen ; yes. 

Mr. Halley. Did Rosen succeed to many of Siegel's interests in the 
wire service? 

Mr. Moore. Frankly, I believe the hearing pointed out that Rosen 
and Sedway and a brother of Benjamin Siegel — I can't recall his 
name 

Mr. RoBiNSOx. Soloway. 

Mr. Moore. Took over the interests of the Golden Nugget and — and 
I believe the Frontier Club. I am not positive about that. 

Senator Wiley. Were these local characters ? 

Mr. MooRE. Three of them had been here for quite some time. In 
fact, probably — one of them practically ever since the inception of the 
race wire in Las Vegas. His name was Sedway. 

Rosen came in here from the East, to my knowledge. 

Mr. Halley. He came about a week after the murder of Siegel ; is 
that right? 

Mr. Moore. I don't know exactly when he did come,' but I know that 
he came in here. 

Mr. Halley. And he took, in effect, Siegel's place in the race-wire 
picture? Would that be right? 

Mr. Moore. He took over the interests of the Golden Nugget and the 
Frontier Club and, supposedly — at least in the hearin<T — a fellow by 
the name of Connie Hurley at that time had the race-wire service. 

Mr. Halley. In connection with the Frontier Club, were they not 
having some difficulties with the Stearns brothers with regard to rac- 
ing-wire service? The Stearns brothers had a club right next door; 
didn't they ? 

]Mri Moore. Yes ; the Steams brothers had a club next door. 

Mr. Halley. Was that called the Santa Anita Club? 

Mr. Moore. That is right. 

Mr. Halley. And they got to the point where they stole the racing- 
wire service from the Frontier Club? 

Mr. Moore. That is right. 

Mr, Halley. They put a microphone in the Frontier Club so that 
when the racing results were announced in the Frontier Club they 
could be heard at the Santa Anita Club ; is that right? 

Mr. jNIoore. That is right. 

Mr. Halley. And the Frontier Club groups went to the Federal 
Communications Commission and the Federal district attorney in an 
effort to have them prosecuted ; is that right ? 

Mr. Moody. I frankly do not remember who went to the Federal 
Communications Commission, but somebody did. 

Mr. Halley. All of this was resulting in great bitterness; is that 
right? 

Mr. Moore. Building up to pitched battle, frankly. 

Mr. Halley. Did the Governor, Governor Pitman, order hearings in 
October of 1948, here in Las Vegas ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 5 

Mr. Moore. Yes. 

Mr. Halley. At those hearings the various people connected with 
the racing-wire service were heard; is that right? 

Mr. MooRE. That is right. 

Mr. Halley. Growing out of those hearings was it recommended to 
the State legislature that the Nevada gambling law and the Nevada 
race-wire-service law and the Nevada parimutuel law be passed and 
put into effect ; is that correct ? 

Mr. MooRE. No ; that isn't exactly correct. 

Mr. Halley. Will you state the correct facts, then? 

Mr. MooRE. In this State, to my knovviedge, the Nevada Tax Com- 
mission has never made a recommendation to the legislature concerning 
laws to be enacted. 

Senator Wiley. Did the Governor make the recommendations after 
those hearings ? 

Mr. MoORE. I didn't read the Governor's message, so, frankly, I can- 
not state. I might say that 

Senator Wiley. They passed them, anyway ? 

Mr. Moore. They passed them. I, individually, instituted the 
gambling law and saw that it was introduced to members of the legis- 
lature, and an attorney in Reno, Nev., drafted the original race-book 
bill that is now in effect, and through members of the legislature led to 
such. 

Mr. Halley. The law requires the licensing of all gambling estab- 
lislr.nents; is that right? 

JSIr. MooRE. That is right. 

Mr. Halley. Prior to 1949 was it required that gambling establish- 
ments be licensed ? 

Mr. MooRE. Yes. 

]Mr. Halley. Both in town, the county ? 

Mr. Moore. The license in the State and the county, if they happen 
to be located in the count}^ or in the city, if they happen to be located 
in the city. 

Mr. Halley. Since what year, if you know, has it been necessary 
that gambling establishments be licensed ? 

Mr. Moore. Since 1931, the enactment of the gambling law. 

Mr. Haij^ey. And does the 1949 law strengthen the older law in 
any way? 

Mv. Moore. Yes. 

Mv. Halley. Would you state how? 

Mr. Moore. It is a little hard to state exact things, but I will say 
frankly, through the State becoming involved in the licensing of gam- 
bHng and the control of such, and the fact that they had to have a State 
license before they could get a city or a county license. 

Mr. Halley. Is that something that did not exist prior to 1949 ? 

Mv. Moore. I do not remember the year, but it was somewhere — 
1948 or 1949, somewhere in there. 

Mr. Halley. You also passed a law requiring that the racing-wire 
service be furnished on a nondiscriminatory basis; is that correct? 

Mr. JSIoORE. That became — I don't know whether it is part of the law 
or part of the rules and regulations of the tax commission, but that 
is essentially correct. 



6 ORGANIZED CRIME IN INTERSTATE COIVUVIERCE 

Mr. Hallet. Well, it is the law, entitled the "Race Wire Service 
Law." The rates which are charged must be fixed by State tax com- 
mission ; is that right ? or proved by the State tax commission 'I 

Mr. MooRE. They could not be above what they were on a certain 
date. 

Mr. Hallet. March 1, 1948? 

Mr. Moore. That is right. 

Mr. Hallet. And any increase would have to be approved by the 
commission ? 

Mr. Moore. That is right. 

Mr. Hallet. And the charges to all consumers had to be on the 
same basis ? 

Mr. Moore. I don't remember whether it states that or not. It 
couldn't be any greater what they were charging. So if they are 
charging a particular individual $200 on March 1, 1948, they could 
never charge him over $200 without getting approval ; or if they were 
charging another individual $500 on March 1, 1948, they could not go 
over that without getting approval. 

Mr. Hallet. They were not allowed to refuse service to anybody 
who was licensed by the State ? 

Mr. MooRE. No. 

Mr. Hallet. And they must also have a county and township 
license, is that right? 

Mr. Moore. That is right. 

Mr. Hallet. Are they required to furnish such service at a reason- 
able pi'ice to be approved by the commission? 

Mr. Moore. They have been required to furnish it at what figure 
they were furnishing it on March 1, 1948, or less. 

Mr. Hau.et. How about new people? 

Mr. Moore. They have done so. 

Mr. Hallet. Where there are new users, who fixes the rate ? How 
do you prevent tliat rate from being so high as to be discriminatory ? 

Mr. MooRE. That has never come up. 

Mr. Hallet. Nobody has ever complained about the rate which was 
asked of them ? 

Senator Wilet. Discriminatory or confiscatory? 

Mr. Hallet. I said discriminatory as against the user. Also, you 
would be confiscating his business; it would be both. 

Senator Wilet. I don't think the record is very clear when you talk 
about the rate as to just what you mean. 

Mr. Hallet. We are talking about the charge which is made gener- 
ally on a weekly basis by the operators of the racing-wire information 
service to the operator of a betting room or a horse book. Those 
charges are made weekly. 

Senator Wilet. I think that clears it up, at least in my own mind. 

Mr. Moore. "^Vliat was your question again ? 

Mr. Hallet. The question before you was whether you had any 
complaints from any users of racing service that discriminatory prices 
were being charged. 

]\Ir. Moore. Frankly, I have been told that, by an operator, that he 
wrote a letter to Carson City complaining about the rate. 

Mr. Hallet. But nothing has been done by the commission? 

Mr. ISIooRE. I have not seen that letter and, frankly, I have neg- 
lected to ask the secretary of the commission if he ever got the letter. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 7 

Mr. Halley. How long ago were you told about it ? 

Mr. Moore. About 3 weeks ago. 

Mr. Halley. Who was the operator or who complained ? 

Mr. Moore. The operator that complained was Connie Hurley. I 
might explain, however, that during the time that this— of this hear- 
ing — Connie Hurley controlled the race-wire service. That is, he was 
the local representative. 

Mr. Halley. He was registered as the owner; was he not? 

Mr. MooRE. I presume ; yes. 

Mr. Halley. For the record, At this time what was the name of 
the service he controlled ? 

Mr. Moore. That I do not remember. 

Mr. Halley. Go ahead. 

Senator Wiley. Mr. Halley, may I interrupt here again? Do I 
understand now that what happened was this : That you have passed 
this law that the charge was fixed by the State through the tax com- 
mission for the wire service in each individual case. In other words, 
the wire service had nothing to do with fixing the charge; is that 
right ? 

Mr. Moore. That is right. 

Senator Wiley. Are you sure tliat they all played fair, or there 
weren't any rebates or there weren't some overcharges by anybody? 

]Mr. MooRE. No, frankly. 

Senator Wiley. You don't know ? 

Mr. MooRE. I don't know. 

Senator Wiley. Who was in control of the wire service ? 

Mr. MooRE. Do you mean after the law went into effect ? 

Senator Wiley. Yes. 

Mr. MooRE. There was a fellow by the name of Dunne. 

Senator Wiley. Where does he live ? 

Mr. JNIooRE. That was appointed. 

Senator Wiley. Where does he live ? 

Mr. Moore. Pie lives here in Las Vegas; James Dunne. He was 
appointed by whoever controls the wdre service. 

Senator Wiley. He w^as appointed by the owners of the wire 
service ? 

Mr. MooRE. Yes. 

Senator Wiley. Wlio are they ? 

Mr. Moore. That I don't know. 

The Chairman. Is it Continental Press that comes in here ? 

Mr. MooRE. I think so ; yes. 

INIr. Halley. It is now Continental. It comes from Arizona. 

Senator Wiley. May I interrupt again? Were there fixed rates 
by the commission depending upon, apparently, the number of clients 
served, or how was that done ? How did they arrive at that ? 

Mr. MooRE. Fellow, there has never been a meeting of all of the 
race-book operators called by the tax commission, and we assume 
that if somebody 'had a squawk concerning the race wire service 
charge, that we would hear from him. 

Senator Wiley. What was the State's take altogether? Do you 
know what it amounted to ? 

Mr. ]\Ioore. Do you mean from licensing the race wire service? 

Senator Wiley. Yes. 



8 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Moore. Frankly, I do not know. 

Senator Tobey. Are most of these gamblers and bookmakers 
crooked ? 

Mr. Moore. No. 

Senator Tobey. Are most of them members of high integrity ? 

Mr. Moore. Well, it depends on how you describe "high integrity." 

Senator Tobey. You know what integrity is as well as I do: 
character. 

]\lr. Moore. I would say that it is probably like any other jn'ofession. 
There are some 

Senator Tobey. No more in this business than there are in any com- 
mercial line? 

Mr. Moore. Yes, I would say a few more shady characters. 

Senator Tobey. What hope do you ever see of getting rid of them ? 

Mr. Moore. That I have never thought of. 

Senator Tobey. Would that be a desirable thing, in your judgment? 

Mr. Moore. Some individuals, maybe, yes. 

Senator Tobi:y. For the common good, I mean. 

INIr. JNIooRE. Yes. 

Senator Tobey. How much does your establishment pay for the 
service ? 

Mr. Moore. For the race-wire service? 

Senator Tobey. Yes. 

INIr. Moore. Approximately $200 per month. It is just a new estab- 
lisliment and it was just started, and frankly it was started at too 
low a rate in comparison to other large establishments, and we were 
told by Mr. Dunne at the time we ]>ut the race book in there that 
within a reasonable length of time, after it had a chance to build up 
any amount of business, that we would go on the same rate that the 
larger downtown clubs did. 

Senator Tobey. It might interest you to know, Mr. Moore, that 
we examined the Continental Press directors and officials in Washing- 
ton^ and asked how many receivables they had, and they had 20 or 
24 receivables. The first name on his list, we asked them what they 
paid for the service, and it may surprise vou that they said $6,000. 
And I said, "$6,000 a year?" 

"Oh, no, $6,000 a week." 

So there is one that pays $312,000 a year to Continental Service. 
Does that surprise you ? 

^Mr. Moore. No. 

Senaor Tobey. $312,000 a year? 

Mr. Moore. That doesn't surprise me. 

Senator Wiley. Is that all you have paid, this $200 a month? 

Mr. Moore. That is approximately it. It may be $225. 

Senator Tobey. There is no other under-the-table arrangement 
of any kind ? 

INIr. Moore. No. 

Senator Tobey. Is there anyone coming around from the service 
and attempting to blackmail you for anything? 

Mr. IMooRE, No. 

The Chairman. Who do you make your checks to for the service? 

Mr. Moore. Frankly, fellow, the auditor handles that, and I cannot 
answer. I presume to James Dunne. 



ORGANIZED CRIME IN INTERSTATE COAIMERCE 9 

Senator Tobky. Mr. Witness, you are the chairman of the tax com- 
mission, aren't you ? 

JNIr. Moore. No. 

Senator Tobey. What is your position ? 

Mv. INlooKE. I represent business on the tax commission. 

Senator Tobey. That interests me. How many members are on the 
tax commission ? 

Mr. Moore. Seven. 

Senator Tobey. And one represents business ? 

Mr. MooRE. Yes. 

Senator Tobey. What do tlie others represent ? 

INIr. JSIooRE. One represents mining, one represents 

Senator Tobey. Wouldn't mining come under the spur of business? 
What is 3'^our definition of business in that category there? 

Mr. MooRE. Frankly, I only know how the commission is set up, 
fellow, and I can tell you. 

Senator Tobey. How were you appointed, by the Governor? 

]\Ir. McORE. Yes. 

Senator Tobey. To represent business? 

Mr. Moore. Yes. 

Senator Tobey. What are the other classifications? Mining and 
what else ? 

]Mr. Moore. ISIining, cattle, industry, land, banks, and a member or 
the head of the publishing service commissions, a member, which would 
control the utilities and the Governor. 

Senator Tobey. How much control does the tax commission have 
over gambling and books in this State ? 

]Mr. MooRE, Enough control that you could put them all out of 
business. 

Senator Tobey. Then the question comes about these tariffs; they 
var}^ tremendously, don't they, from nothing up to 100, we'll say, the 
ratio? Wouldn't it seem to indicate that you, as a member of the 
commission, that the important thing to do would be to have a system 
of tariffs that was uniform? 

Mr. Moore. No; and the principal reason being that business isn't 
uniform. 

Senator Tobey. Well, all business, do you mean ? 

]\lr. Moore. No, the gambling business, the book business. 

Senator Tobp:y. They all get the same facilities, don't they? 

]\Ir. ISIooRE. They get the same facilites. 

Senator Tobey. Doesn't individual initiative count in there, and 
personality? 

Mr. MooRE. Not necessarily. The amount of the investment, the 
size of the club, the amount of money that a man has to spend on adver- 
tising, and so forth. It is just like any other business. 

Senator Tobey. It gives you tremendous ])owers for good or evil, 
to buy favor and curry favor. You can put the juice on one man and 
enrich the other man, can't you? You can impoverish a certain man 
and you can crown others, can't you ? 

Mr. MooRE. No. 

Senator Tobey. Why can't you ? 

jNIr. IMooRE. It isn't worked on that basis. In other words, it must 
be a fair and square deal. 

G8!)."S -51 — pt. IC 2 



10 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobey. It is a square deal that one man gets it for $200 a 
month and another man pays $6,000 ? 

Mr. MooKE. I don't know of any man that pays $6,000. 
Senator Tobey. To me, a lay mind, it seems like a tremendous dis- 
parity, not only in the ethics but in justice. 

Mr. MooRE. To start with, fellow, the rates are limited as to what 
they were paying in March 1948, and they cannot charge a rate higher 
than that. 

Mr. Halley. You could authorize them to ? 

Mr. Moore. We could authorize them to, but we have not done so. 
Senator Tobey. You have been rather passive, rather than active? 
Mr. Moore. We have been very active, as far as the gambling and 
race horse business is concerned. 

Senator Tobey. Who dominates the tax commission? 
Mr. Moore. No domination. 
Senator Tobey. Rule of majority, is that it? 
Mr. Moore. That is right. 
Senator Tobey. Who is chairman? 
Mr. MooRE. The Governor. 

Mr. Halley. How many licenses have you refused to issue since the 
commission has had the licensing power? 

Mr. Moore. That 1 couldn't tell you, the number. I would say 
several hundred. 

Mr. Haixey. Have you revoked any licenses? 
Mr. Moore. Possibly 75 to 100. 

]\Ir. Halley. In what cases have you refused to issue licenses ? 
Mr. Moore. There are numbers of things, but the main thing is the 
man's background, essentially. 

Senator Tobey. His character, in other words? 
Mr. Moore. His character. 
Senator Tobey. Or lack of it? 

Mr. IMoore. That is right. That is, in our judgment, as members 
of that board. Whether or not our judgment is correct, that is some- 
thing else again. 

Mr. Halley. And there you have full discretion, is that right ? 
]Mr. MooRE. That is right. 

Mr. Halley. You refused to license James Carroll of St. Louis this 
spring, did you not? 

Mr. JSloORE. That is right. 
Mr. Halley. Is that one example? 
]Mr. Moore. That is right. 

Mr. Halley. On what basis did you refuse to license him? 
Mr. MooRE. Principally because of his national prominence in the 
race book business. 

Mr. Halley. Does that affect his character ? 

Mr. MooRE. No, but that is the reason that the license was refused. 
Mr. Halley. Then you have the widest of discretion, is that right? 
Mr. jSIoore. That is right. 

Mr. Halley. He had no previous convictions, had he? 
Mr. Moore. Not to my knowledge. 
Mr. Halley. Did he have any criminal record ? 
Mr. MooRE. Not to my laiowledge. 

Mr. Halley. You have a number of licensees here who have criminal 
records, do you not? 



ORGANIZED CEIIVIE IN INTERSTATE. COMMERCE 11 

]SIr. Moore. That is right. 

Senator Tobey. Isn't that a bar sinister to give him a license. 
Shouldn't it be a condition precedent to giving him a license, that the 
man is clean and has no criniina! ivcord? 

Mr. MooKE. Frankly, no. Tliat is my opinion. 

Senator Tobey. Your standards are different than some of ours. 

Mr. MooRE. In my opinion. 

Mr. Halley. In fact, you have some licensees here — you have cer- 
tain licensees here who are in fact refugees, fugitives from justice in 
otlier States, is that correct? 

Mr. Moore. Not to my knowledge. 

Mr. Halley. Don't you have some licensees who at the present time 
are here because they cannot be extradited from the State of Nevada ? 

Mr. Moore. Not to my knowledge. 

Mr. Halley. How about Binyon? 

Mr. Moore. He is not a licensee. 

Mr. Halley. Doesn't he run an operation here ? 

Mr. Moore. No, not at the present time. He did at one time. 

Senator Wiley. What is your profit on bookmaking in a year, if you 
pay $2,400 or $2,500 a year to the State? 

Mr. Moore. Frankly, fellow, I have been in business only about 
2 months, as far as race business is concerned, so I couldn't tell you 
what a year. I could tell you what we made in the month of October 
in the way of department profit before depreciation, amortization, or 
insurance was charged. 

Senator Wiley. How much? 

Mr. Moore. About $3,400. 

Senator Wiley. A month ? 

Mr. ^Ioore. Yes. 

Senator Wiley. Net, do you mean ? 

Mr. Moore. Net ; that is department profit. 

Mr. Halley. WTiat, if you know, does the Flamingo pay for its 
racing book service ? 

Mr. Moore. I do not know exactly. 

Mr. Halley. There was a time when the Flamingo had its service 
free, is that right, during the Bugsy Siegel days ? 

Mr. IMooRE. I believe that in that hearing it came out that for a time 
they did get free service. 

Mr. Halley. The Flamingo, in other words, paid nothing ? 

Mr. Moore. I might explain, if you would allow me to do so. The 
line of questioning you started on considering Connie Hurley and a 
letter that he wrote to the tax commission concerning service; he was 
the owner of the service. He paid so much money to Continental Press. 
He charged the other operators a certain amount of money, and what 
was left lie paid himself. In other words, it was approximately $150 
a month out of the book that he was operating in one of the downtown 
spots. So, frankly. Hurley was getting what was equivalent to a 
rebate because he was the operator or local representative of the wire 
service. 

Mr. Halley. As a member of the commission, do you think it is wise 
to allow the people operating the wire service to have any connection 
whatsoever with a book? 
Mr. Moore. No. 



12 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Where is Connie Hnrley's home? 

Mr. Moore. Connie Hurley has no connection with the Continental 
Press any more. 

Mr. Halley, TVlien did he discontinue his connection ? 

Mr. Mcore. At the time that law was passed. 

Mr. Halley. I don't quite understand what his complaint was. 
What did he have to pay to the wire service ? 

Mr. Moore. I imagine somewhere in the neiohborhood of $348 
or $368 a month. 

Mr. Halley. In other words, they give him a salary of $150 a week 
and whatever is left over he pays them ? 

Mr. MooRE. Well 

Mr. Halley. It is a varying amount, is that right? 

Mv. Moore. No, you have got it mixed up. 

Mr. Halley. Let's get it again. 

Mr. MooRE. In other words, Hurley was the — at the time the hear- 
ing Avas called he was the local representative of Continental Press. 

Mr. Halley. He was listed as the owner of the Nevada Publishing 
Co., the Continental distributor here. 

Mr. Moore. All right. He paid Continental Press a certain amount 
of money per week. What that amoun.t of money is, I don't remember. 
At that time he was also operating a race book. He charged the other 
operators a certain amount of money, which amount of money I do not 
remember, and what he didn't charge the operators he paid out of his 
race book 

Mr. Halley. Oh, I see. 

Mr. MooRE. Which was approximately $150 a month. In other 
words, frankly, he was his own — his race book was getting special 
treatment, frankly. 

Mr. Halley. How does that cany over, now that his race book pays 
more ? 

Mr. Moore. His race book at the present time is paying approxi- 
mately what other operators of the same type were paying. However, 
I was told that the letter is up there, and as soon as we have time to do 
something about it we will have to call a hearing and get Connie Hurley 
and James Dunne up there and straighten it out. 

INIr. Halley. In other words. Hurley simply wanted to get back to 
his 19-48 rate ; is that right 

Mr. Moore. Wliich was $150 a week. 

IVfr. Hali.ey, Which was discriminatory in his favor? 

Mr. MooRE, Yes, 

Mr. Halley. Have you had no complaints about people who have 
been charged exorbitant rates, too high. Mr. Moore? 

Mr. Moore. To my knowledge, no. 

Mr. Halley. There have been no such complaints that you know of ? 

]\f r. Moore. No. 

Senator Wiley. Before this law went into effect, how many folks 
were engaged in the booking business, and so forth ? 

Mr. Moore. Approximately six or seven establishments. 

Senator Wiley. How many since ? 

Mr. Moore. I believe, if I am not mistaken, there are approximately, 
somewhere between 12 and 15 outlets in Las Vegas at the present time. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 13 

Senator Wiley. Now, then, in your judgment, has the quality of the 
operatoi's been bettered or worsened by tlie haw ? 

Mr. ISIooRE. I would say bettered. I will qualify that statement. 
You are talking about the quality of the operators. In other 
words 

Senator Wiley. The ones that get the licenses. 

Mr. MooRE. The fellows that get the licenses. I would say that the 
fellows who have gotten the new licenses were people that were oper- 
ating clubs here in the State before the law went into effect. 

Senator AViley. How many of them were nonresidents? 

Mr. MooRE. Very few of them. 

Senator Wu.ey. Out of the 15, how many? 

INfr. Moore. Tliere are no nonresidents unless it happens to be a mem- 
ber of a corporation. 

Senator Wili<:y. Was one of the features, then, of the law that you 
increased the number of operators under license from 7 to 15 ? 

iMr. Moore. Yes. 

Senator Wiley. Is that what you mean ? 

Mr. Moore. Well, here is the whole thing in a nutshell. When the 
law went into effect, there were numbers of people operating clubs 
in the community that could not get a license — not a license. 

Senator Wiley. Service ? 

Mr. MooRE. Scratch that. Could not get service, so when the law 
went into effect they applied for service and applied for a license, 
which was automatically increased — which automatically increased 
the number of outlets in the community. 

Senator Wiley. Does the law pay for itself? 

Mr. Moore. Does what ? 

Senator Wiley. Does the law, as you have passed it now, pay for 
what you collect ? 

jNIr. Moore. Oh, most assuredly. 

The Chaikman. Anything else ? 

]\Ir. Halley. Mr. ]\Ioore, how long have you been connected with 
the Last Frontier Hotel ? 

Mr. Moore. Ever since its inception. I was the architect on the 
construction. 

iSIr. Halley. When was that ? 

Mr. Moore. We finished it — opened it in October of 1942. 

Mr. Halley. What had been your business prior to 1942 ? 

Mr. Moore. I was an architect. 

Mr. Halley. For how long ? 

Mr. MooRE. About 4% years, in Dallas, Tex. 

Mr. Halley. Prior to that ? 

Mr. jNIoore. Prior to that, I was going to school at Oklahoma 
A. & yi. College and working in the construction business. 

Mr. Halley. You came to Nevada in 1942? 

Mr. Moore. 1941. 

Mr. Halley. 1941 ; and proceeded to build the Last Frontier Hotel ; 
is that right ? 

Mr. Moore. That is right. 

Mr. Halley. Who are your associates there? 

Mr. Moore. The president of our company is II. J. Griffith, who 
lives in Dallas, Tex., and he is also connected with a large chain of 
theaters back through the ]Middle West. 



14 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. "Wlio are the other principals ? 

Mr. Moore. The vice president of the corporation is myself, and 
there are 10 other members of the organization. Barron, who operates 
our gambling, he originally came from Texas, but came to Las Vegas 
from California. And all of the other members — I can name them, 
if you like. 

Mr. Halley. Would you submit to the committee a list instead at 
some time today ? 

Mr. MooRE. Yes. 

Mr. Halley. What interest have you, what percentage ? 

Mr. Moore. In the Last Frontier ? 

Mr. Halley. Yes. 

Mr. MooRE. I own approximately one-twelfth of the stock of the 
operating company, and I own 408 shares of the owning company. 
I am the only member of the operating company that holds stock 
in the owning company. 

Mr. Halley. Who else owns stock in the owning company with 
you ? 

Mr. Moore. The principal man of the stock is owned and controlled 
by the theater organization in Dallas, Tex. 

Mr. Halley. Did they provide the capital, Griffith ? 

Mr. Moore. Yes. 

Mr. Halley. How much capital was provided ? 

Mr. Moore, Well, I believe the book value of the hotel at the present 
time is about $2,600,000, in that neighborhood. 

Mr. Halley. Did the theater chain provide all of that capital? 

Mr. Moore. Originally the capital was provided by R. E. Griffith, 
and then Mr. Griffith passed away, and througli his estate the theater 
company acquired his estate, through purchase, and that is the way 
they acquired the stock in the hotel. 

Mr. Halley. Does the owning company, then, lease the premises 
to an operating company? 

Mr. Moore. Yes. 

Mr. Halley. And the operating company consists of 11 men ? 

Mr. Moore. Twelve men. 

Mr. Halley. Twelve men ? 

Mr. Moore. Eleven besides myself. 

Mr. Halley. And you have a one-eiglith interest in the operating 
company ; is that righi ? 

Mr. Moore. No ; I have a one-twelfth. 

Mr. Halley. It is evenly divided ; is that right ? 

Mr. Moore. Yes. 

Mr. Halley. Does the operating company operate both the hotel 
and the gambling ? Is it all one operation ? 

Mr. Moore. It is all one operation. 

Mr. Halley. Are there no special concessions whatsoever for 
gambling? 

Mr. Moore. We have a deal on slot machines w^ith a local man here. 

Mr. Halley. Who is that? 

Mr. MooRE. Harry Farnow, F-a-r-n-o-w. 

Mr. Halley. What type of deal is that ? 

Mr. MooRE. He supplies new machines every 2 years and gets 15 
percent of the take. 



ORGANIZED CRIME IN INTERSTATE COIVDMERCE 15 

]Mr. PIalley. Does lie take care of the macliines, too ? 

Mr. ]\IooRE. He keeps them repaired, and so forth. 

Mr. Halley. Who actually takes the money out of them ? 

Mr. Moore, He and one of our representatives. 

;Mr. Halley. Togetlier ? 

Mr. Moore. Yes. 

Mv. Halley. Do you have any other concessions ? 

Mr. Moore. In the gambling? 

Mv. Halley. Yes. 

Mr. Moore. Yes; there is a fellow by the name of Waterman that 
has 50 percent interest in the penny roulette; a fellow by the name 
of Phillips that has a 50 percent interest in the commission room. 

Mr. Halley. Who is Phillips ? 

Mr. Moore. He came out of California, fellow. 

Mr. Halley. Why do you have these concessions? Let's take the 
slot machines first. Certainly the investment is not such that your 
own company could not make it ; is it ? 

JNIr. MooRE. No. The principal reason being that the man knows 
the business backward. He knows where to place the machines. He 
is a merchant in that particular line, and the fact that if he supplies 
new machines every 2 years, which you need if you get any activity 
on them at all, taking everything into consideration, he makes about 
6 or 7 percent on his investment: so, frankly, it is a lot less trouble 
for us, and we are willing to let him make the 6 or 7 percent rather 
than have to mess Avith them ourselves. 

]\Ir. Halley. Could you buy the machines if you wanted to ? Are 
they available on the market ? 

Mr. MooRE. Oh, sure. 

Mr. Halley. Can anybody buy a machine and set it up in this State t 

INIr. Moore. Yes, as long as they have a license. 

Mr. Halley. Would you explain why you have the other conces- 
sions ? Take the commission room. 

]\Ir. Moore. Well, the penny roulette is an illustration, and the rea- 
son we have that concession is that we know nothing on earth about 
penny roulette, and it is a special game all within itself, and I have 
seen many people try to operate it and never make a quarter. Others 
operate it and do all right. 

Senator Tobi:y. Does this man have a concession in the other hotels? 
I am speaking of Farnow. 

Mr. Moore. No; I think that is the only concession he has at the 
present time, but at one time he did have the concession in the El 
Ranclio. 

And Phillips on the commission room, frankly, that is a dangerous 
game. You can win or lose $200,000 or $300,000 or more in one day. 

Mr. Halley. Would you explain what the commission room is? 

Mr. Moore. The commission room is a lay-off room for the race- 
horse book. In other words, they lay off bets that are received in the- 
race book. 

Senator Tobey. Eeinsurance? 

Mr. Moore. Reinsurance, yes. 

Mr. Halley. Do you lay off all your bets, or only a part? 

Mr. Moore. We lay off the ones we want to lay oft'. 

Mr. Halley. "Wliat was the answer ? 



16 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Moore. I said we lay off the bets that we want to lay off. In 
other words 

Mr, Halley. You keep some lay-offs, though ? 

Mr. MooRE. Yes. 

Mr. Halley. Do you accept any lay-off bets from others ? In other 
words, do you do any lay-off booking ? 

Mr. MooRE. To my knowledge, no. 

Mr. Halley. With whom do you lay off ? 

Mr. MooRE. I presume that he lays off with people all over America. 
Who the exact people are, I don't know. 

Mr. Halley. In other words, you lay off in States where gambling is 
not legal ; is that right ? 

Mr. MooRE. I presume ; yes. 

The Chairman. Where does Mr. Phillips have his office, the lay-off 
man? 

Mr. MooRE. Right in the race — right off the race-horse book ? 

The Chairman. Does he do the same thing for other books in Las 
Vegas ? 

Mr. MooRE. I presume so ; yes. 

Mr. Halley. He has a table with an elaborate set of keys on it so 
that he can put long-distance calls to cities all over the country; is 
that not right ? 

Mr. MooRE. That is right. 

Mr. Halley. And you have special arrangements with the phone 
companies that your long-distance calls go through very fast? 

Mr. MooRE. He does have. He made those arrangements. 

Senator Tobey. Those long-distance calls from the commission 
room take precedence over private calls ? 

Mr. Moore. Frankly, I can't answer that. 

Mr. Halley. They go right through in a matter of seconds ? 

Mr. Moore. They go right through ; I know that. 

Mr. Halley. He just presses a button and he is there. 

Senator Tobey. So that the time that might elapse if a man wanted 
to place a million dollars in lay-off bets with 

Mr. Moore. Might be only a matter of minutes anyplace. 

Senator Tobey. It is done by word of mouth ? He accepts it and it 
is all done? 

Mr. Moore. That is right. 

Senator Tobey. Is it confirmed by letter or telegraph ? 

Mr. Moore. No. 

Senator Tobey. It is all a matter of yes or no ? 

Mr. Moore. That is right. 

Senator Tobey. Is there any reneging? 

Mr. Moore. At times there have been in such operations, but as far 
as Phillips is concerned, I doubt it. 

The Chairman. He lays off with Carroll, Erickson, and other 
people ? 

Mr. Moore. He lays off with a lot of people, fellow. Exactly who 
they are, I don't know. If I did, I would tell you. 

Mr. Halley. For the committee's information, it is presumed, I 
believe, that the general set-up is the same in all of the hotels and 
gambling establishments, is it not, the technical arrangements ? 

Mr. Moore. What do you mean ? 



ORGANIZED CRIME IN INTERSTATE^ COMMERCE 17 

Mr. Halley. For instance, the commission rooms, the horse room. 

Mr. Moore. Well, in some places, yes; in some places, no. The 

gambling — the Flamingo Hotel, I think, has a commission room. I 

don't know about the others, frankly, but I don't think that any of the 

other hotels have a commission room. 

Mr. Halley. How do they handle their lay-off ? 

Mr. Moore. They handle it through somebody. Exactly who, I 
don't know. 

Mr. Halley. For the committee's information, if they have time, 
would it be possible for them to see the commission room and the re- 
maining parts of the establishment at the Last Frontier ? 

Mr. MooRE. Sure. 

Mr. Halley. Do you think you could guide them through and 
show them the various operations 'i 

Mr. Moore. That is right. 

Senator Tobey. Perhaps the most serious blow that can be struck, 
providing it is wise to do it, at this professional gambling game, as a 
national evil, if it is such, would be to make it illegal by Federal law 
for the transmission of any gambling information by wire service, 
wovdcln't it? That would be a crimp in it, wouldn't it? 

Mr. MooRE. That would put a crimp in that racing. 

Senator Tobey. If you were in charge and paid a fee of $50 to put 
in something to put them out of business, what would you do ? 

Mr. MooRE. Frankly, fellow, the law is about the only way-^ — ■ 

Senator Tobey. Would you suggest boycotting or prohibiting lay-off 
bets ? Wouldn't that be a strangle blow to the thing ? 

Mr. Moore. You are going to have to get at the wire itself and 
make it illegal for the telephone companies to supply service, and so 
forth and so on. You have got to go all the way, if you start. 

Mr. Halley. If an interstate lay-off bet were illegal and the tele- 
phone company were required by law to give the information to the 
prosecuting officers, you would pretty well stop it, wouldn't you? 

Mr. MooRE. I would say so ; yes. 

Mr. Halley. It would be impossible for the phone company not to 
know where a large lay-off operation was going on, wouldn't you 
say that ? 

Mr. MooRE. I would say practically impossible. Of course, I don't 
know about the larger operations where they have more mechanical 
equipment, but I know it would be impossible in this small community. 

Mr. Halley. We understand, of course, that your local operations 
within the State of Nevada are legal, and with that in mind would you 
give the committee in round figures the net profits of the gambling 
establishments operated by the Last Frontier, say, the last 5 years? 

Mr. MooRE. Fellow, I can give you the gross. 

Mr. Halley. What would the gross be ? 

Mr. MooRE. The gross in all operations in the Last Frontier includ- 
ing gambling last year 

Mr. Halley. By "gross" do you mean gross profits ? 

Mr. Moore. Gross dollars taken in. 

Mr. Halley. What is that, first ? Let's get that figure. 

Mr. Moore. Approximately $4,000,000. 

Mr. Halley. That is the gross receipts ? 

Mr. MooBE. That is the gross receipts in food, beverages, gambling. 



18 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr, Halley. Everything? 

Mr. Moore. Everything. 

Senator Tobey. All income? 

Mr. Moore. That is right. 

Mr. Halley. What is the gross profit for the last year ? 

Mr. Moore. That, frankly, I don't remember. I know we — — 

Mr. Halley. Wliat did you make last year ? 

Mr. MooRE. We showed approximately 100 and — as I remember, 
$135,000 net profit. 

Mr. Halley. For the entire operation ? 

Mr. Moore. That is right. 

Senator Tobey, It wasn't very much, was it ? 

Mr. Moore. No. 

Mr. Halley. How much rent is paid to the owning company ? 

Mr. Moore. The original rent was approximately $10,000 a month. 
However, the owning company has built a number of buildings since 
the original lease was made and it is now — we are now paying approxi- 
mately $14,000 a month. 

Mr. Halley. They get no percentage of the gross or the net ? 

Mr. Moore. No. 

Senator Wiley. Who owns it ? 

Mr. Moore. Who owns the hotel ? 

Senator Wiley No, the holding company. Who are the big stock- 
holders ? 

Mr. Moore. It is owned by this theater chain. Theater Enterprises, 
in Dallas, Tex. 

Senator Wiley. You said the Griffith estate. I think you said he 
died. 

Mr. Moore. Well, we organized a corporation after Griffith's death, 
and bought theaters and estate, and so forth and so on. 

Senator Wiley. I want to find out who the big stockholders are 
in that. 

Mr. Moore. Well, I think the new organization — I think it is 
■evenly divided between 8 or 10 people. 

Senator Wiley. Can you name them ? 

Mr. MooRE. Well, there is a fellow by the name of Payne, fellow by 
the name of Harris, Heinscheid, Stocker, R. E. Griffith, Jr., which 
is the son of the man that passed away. Essentially, those are the 
principal ones. 

Senator Wiley. Are they all residents of Texas ? 

Mr. MooRE. Most of them, yes. 

Senator Wiley. Are they all businessmen ? 

Mr. MooRE. In the theater business ; operate some 200 theaters. 

Mr. Halley. Do any of the stockholders in the operating company 
receive salaries ? 

Mr. MooRE. Yes, I receive a salary. 

Mr. Halley. What salary is that? 

Mr. MooRE. I receive $10,000 a year plus my food, and 5 percent of 
the gambling operations after rental is charged, and depreciation, and 
so forth and so on. 

Mr. Halley. Let's get this now. Before we get to this $134,000 net 
profit, you have received $10,000 in salary; item 1. 

Mr. Moore. Yes. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 1^ 

Mr. Halley. Item 2, your food. Do you live at the hotel, too ? 

Mr. MooRE. No. 

Mr. Halley. You do not get your accommodations free, then ? 

Mr. Moore. No. 

Mr. Halley. Item 3 would be 5 percent of the net from the 
gambling operations ? 

Mr. Moore. The way it is figured is all of the direct expenses on the 
gambling department — we call it a department — all of the direct 
expenses, including wages and so forth and so on, are taken off of the 
gross figure, and then one-half of the entertainment and one-half of 
the advertising, plus rent and maintenance and lights and water, 
and so forth and so on, are then taken off, and then I get 5 percent 
of that. 

Mr. Halley. What did that amount to last year? 

Mr. Moore. My income last year was, approximately, somewhere 
betM'een $75,000 and $84,000, somewhere in that neighborhood. 

Senator Tobey. A minute ago you told us that the income was 
$5,000,000 or $4,000,000 from all sources. What I am getting at is : 
Was that for 1 year or several years ? 

Mr. MooRE. One year; $2,000,000 of that $4,000,000 came from 
gambling. 

The Chairman. How about these other 11 partners. Do they re- 
ceive salaries? 

Mr. Moore. The fellow that operates the gambling department, 
Barron, receives approximately what is equivalent to about $12,000 a 
year in direct wages plus his food. 

Senator Tobey. Is some eastern capital in the enterprises that you 
control ? 

Mr. Moore. No; it is all out of Dallas, Tex., or Las Vegas. 

Senator Tobey. Does the Flamingo compare, if you know, with your 
earnings, the El Eancho, and so forth? 

Mr. MooRE. I would say it depends on what their corporate set-up is 
and how long their lease runs, and so forth and so on, because if the 
lease is a short lease you have got a big write-off, and if it is a long 
lease you have got a slow write-off, so that enters into the net profit, 
you see. I would say that their gross is one that compares very favor- 
ably. What their corporate set-up is and their write-off is and so 
forth, I would have no way of knowing. 

Mr. Halley. Have you had better years than last year? 

Mr. MooRE. Yes; 1945 was a better year. 

Mr. Halley. What was your gross in 1945 ? 

Mr. MoORE. I don't remember, fellow, and I don't know that the 
gross was any better than it was last year, but the net was better. 

Mr. Halley. The net was better? 

Mr. Moore. Yes, because of not so much write-off, frankly. 

Mr. Halley. How about other years? Was 1946 a good year? 

Mr. MooRE. 1946 was a good j^ear. 

Mr. Halley. Better than 1949 ? 

Mr. MooRE. That I can't remember. 

Mr. Halley. Can you furnish the committee — I presume you have 
a report for each of your years of operation ? 

Mr. MooRE. A full audit for every year or any month. 



20 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. The committee, as one of its purposes in being here, 
is attempting to get some reliable figures on the operation of a gam- 
bling establishment, which is obviously almost impossible to obtain in 
any other State. 

Mr. Moore. That is right. 

Mr. Halley. So that if you could give us the annual auditor's report 
for each year of your operation, we would like very much to have it. 

The Chairman. From 1945. 

Mr. Halley. From 1942 on. 

Senator Wiley. Wouldn't it be a good idea to get a breakdown on 
food, gambling? 

You told us $2,000,000 of that $4,000,000 was from gambling? 

The Chairman. "VVlio is Ballard Barron ? He is the one that oper- 
ates the gambling place? 

Mr. MooRE. That is right. I might explain further that in addition 
to his wages of $12,000 a year, he draws 5 percent of the gambling, too, 
based on the same 

The Chairman. Basis that you get your money ? 

Mr. MooRE. On the same basis that I get mine. 

The Chairman. So he makes approximately the same amount 
you do ? 

Mr. MooRE. Approximately, yes. 

Senator Wiley. Between $70,000 and $80,000 a year? 

Mr. MoORE. That is right. Some years, back in 1942, it was con- 
siderably less because our gross was less, and so forth and so on. 

The Chairman. I have a note here that he had an interest in some 
of the gambling ships off the California coast. Is that right ? 

Mr. MooRE. At one time I think he did, yes. 

The Chairman. He doesn't have it now ? 

Mr. MooRE. No, there are no such operations now. 

Senator Tobey. Did you know Bugsy Siegel personally? 

Mr. MooRE. Yes. 

Senator Tobey. Talked with him, met him ? 

Mr. MooRE. Yes. 

Senator Tobey. Was a personable fellow ? 

Mr. MooRE. At times ; at other times, kind of hard to get along with. 

Senator Tobey. Was he yellow ? 

Mr. Moore. That, I can't say. 

Mr. Halley. How was the daily gross income from the gambling 
operations computed? Let us take the crap tables, for instance. 
Does each table start with a bank roll of its own ? 

Mr. Moore. It starts with a bank ; yes. 

Mr. Halley. What allowance is given to each table? Does it vary 
on different nights? 

Mr. Moore. No ; because we work it on the fill basis. In other words, 
we start off with a certain bank, and, as the money goes out, it goes 
out, we put what we call a fill in there. 

Mr. Halley. What is the bank roll for the entire operation ? 

Mr. Moore. Well the bank roll in the one casino at the hotel is $100,- 
000. In the one at the Village it is approximately the same, $75,000 
to $100,000. 

Mr. Halley. Would you start each individual table with a certain 
allowance ? 



ORGANIZED CRIME IN INTERSTATE COIMMERCE 21 

Mr. Moore. A certain amount of money ; yes. 

Mr. Halley. During the course of the evening do you take back any 
overage ? 

Mr. MooRE. We make fills, if they need fills, or we take back overages 
as the racks come in. We make records of the fills and we make 
records of the overages as they come back to the casino cage. 

]Mr. Halley. Who does the actual collection ? 

Mr. MooRE. What do you mean, "collection" ? 

Mr. Halley. Of the money from the tables during the course of 
the evening. 

Mr. MooRE. Well, usually a policeman on our payroll will collect 
the money or get the boxes. The boxes are locked and they are 
brought to the casino cage, and the cashier and the manager of the 
gambling in the hotel counts the money. 

Mr. Halley. That is recorded, each individual time the box is 
opened ; is that right ^ 

Mr, Moore. That is right. 

Mr. Halley. And any additional money sent out to the table is 
also recorded ? 

Mr. MooRE. That is right. 

Mr. Halley. Ordinarily, those chips are cashed in at the cashier's 
cage ; is that right ? 

Mr. Moore. That is right. 

Mr. Halley. Is every individual transaction with the cashier 
where the cashier cashes chips also recorded ? 

Mr. ^looRE. No. 

Senator Wel-ey. Who is your auditor? 

Mr. MoORE. Wolf & Co., out of Oklahoma City, principally be- 
cause they are the auditors for the theater company, and there is a 
close alliance there, so we tried 40 auditors in this part of the country 
and they never could do a good job, so we just sent it to Oklahoma 

City. 

Senator Wiley. Are you interested in any other similar enterprise 
any place? 

Mr. MoORE. Am I interested? No; I have no other gambling in- 
terests. 

Mr. Halley. AVliat is the system inside the cashier's cage to safe- 
guard both the individual partners and the Government for taxes? 
How do you operate ? 

Mr. MooRE. In what do you mean ? 

Mr. Halley. What control have you got in there? 

Mr. MooRE. The casino cashier and the manager of the gambling 
department count the money and record it. 

Mr. Halley. Each night ? 

Mr. Moore. Each night, as the boxes are taken in. 

Mr. Halley. And the manager actually stays in the cage? 

Mr. IMooRE. No ; he only goes in the cage when he is called there by 
the cashier. 

Mr. Halley. Is he called there every time a box is opened ? 

Mr. ]\Ioore. Yes. 

Mr. Halley. And he counts the monej^ with the cashier; is that 
right? 

M]\ MooRE. Yes. 



22 ORGANIZED CRIME IN INTERSTATE COMIVDERCE 

Mr. Halley. How do you handle it when somebody walks up to the 
window with a stack of chips to cash them in ? Who records that? 

Mr. Moore. There is no recording of it. We have a record of the 
number of chips that are on the tables, and that is the only place that 
people can get any chips. 

Mr. Halley. Do you have a daily count of the chips ? 

Mr. Moore. Yes. 

Mr. Halley. When chips come into the cage, gambling money is 
just paid out and no record is kept? 

Mr. Moore. The money is paid out and the chips are racked back up 
again, and you have got a certain amount of chips all the time. You 
work with a certain number. 

Mr. Halley. Where do you get your chips ? 

Mr. MooRE. We buy them from various companies. 

The Chairman. Anything else? 

Mr. Halley. Yes. I was getting on to another line. How did you 
happen to become a member of the State tax commission ? 

Mr. Moore. I was appointed there by the Governor. A man by the 
name of Mannix, in Boulder City, Nev., had become sick, was a member 
of the commission, and the Governor appointed me to the commission. 

Mr. Halley. When were you appointed? 

Mr. Moore. Approximately three and a half years ago, May 1. 

Mr. Halley. Does the commission divide up its functions so that 
you, as the business representative, have more to say about the licensing 
of gamblers than the other representatives ? 

Mr. Moore. I have no more to say other than I handle the question- 
ing. I handle the investigation and so forth and so on. 

Mr. Halley. Do you make specific recommendations ? 

Mr. Moore. Specific recommendations — but, as far as the voting, 
is concerned, why no. 

Mr. Halley. We have a list of some of the people who have been 
operating here. Let's take, for instance, the Bank Club operated by 
William Graham and James McKay. 

Mr. MooRE. Yes. 

Mr. Halley. Did you issue — recommend the issuance of a license 
to Graham and McKay ? 

Mr. MooRE. Frankly, I imagine the motion was made by somebody 
from Reno. 

Mr. Halley. Did you vote for a license for Graham and McKay ? 

Mr. Moore. Yes. 

Mr. Halley. Graham and McKay were convicted in the southern, 
district of New York, were they not ? 

Mr. MooRE. That is right. 

Mr. Halley. Of a violation of a Federal law. 

Mr. MooRE. I presume. I have been told that. I have seen the- 
record. 

Mr. Halley. They possessed and then altered and then passed Gov- 
ernment bonds which had been stolen from the Bank of the Man- 
hattan Co. 

Mr. Moore. I haven't seen the complete run down on the case, fellow. 
It is a very famous case. It went clear up to the Supreme Court, 
did it not? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 23^ 

Mr. Halley. How would you say that Graham and McKay are 
qualified after that conviction to operate a gambling establishment 
in the State of Nevada, or anywhere else ? 

Mr. MooRE. They are qualified — I wouldn't say they are 
qualified 

Senator Tobey. Was that conviction known to the tax commission 
in Nevada when you voted to give them a license ? 

Mr. MooRE. Yes. 

Senator Tobey. How do you reconcile that ? 

Mr. ]\IooRE. To start with, it is an illustration, when a law is passed, 
we'll say, to protect the people such as the law concerning lawyers, 
sucli as the law concerning architects, such as the law concerning engi- 
neers, and so forth. There is a certain amount of granddaddy clause 
in there, isn't there ? 

Senator Tobey. Of course, I know the Interstate Commerce Com- 
mission has a granddaddy clause. That is the only one I know of. 

Mr. Moore. All the other ones have, too, if you read the laws. In 
other words, there may be attorneys or there may be gamblers, or 
engineers, at the time that the law goes into effect that are in busi- 
ness in the State. Just because you get the privilege of controlling 
the thing, is that any reason why you should put the man out of busi- 
ness, if he is operating in the State of Nevada ? 

Senator Tobey. Yes; I think it is; but you and I might differ about 
that. I think if you have a man that is crooked and shown to be 
crooked, and a lawbreaker, I wouldn't give him any privilege at all. 

What percentage of income from all these enterprises escapes Fed- 
eral taxation, in your judgment? 

JNIr. MooRE. Frankly, I have no way of knowing, if any. I frankly 
doubt if there is very much of it in the State of Nevada. 

Senator Tobey. I just wanted to ask your opinion. Thank you 
very much for that. 

The Chairman. Anything else, Mr. Halley ? 

Mr. Halley. Yes. 

Do you know Sanf ord Adler ? 

]\Ir. MooRE. Yes. 

]\Ir. Halley. Does he operate a gambling establishment ? 

Mr. Moore. Yes. 

Mr. Halley. AVliich one ? 

Mr. Moore. Calnev, at Lake Tahoe, and Calnev Club, I believe, in 
Reno, Nev. 

Mr. Halley, Are you familiar with his record ? 

Mr. Moore. His police record ? As I remember it, he was arrested 
and convicted for stealing some iron, or something like that. 

Mr. Halley. He has a long list of arrests, does he not, also ? 

Mr. Moore. Yes. 

Mr. Halley. How do you explain his being qualified for a license? 

Mr. MooRE. On the same explanation that I made as far as McKay 
and Graham were concerned. 

The Chairman. Do you mean he was in business before? 

Mr. Moore, He was in business in the State of Nevada at the time 
the tax commission was given the powers to control the licenses, 

Mr, Halley, You didn't throw out any of the people who were 
here ? 



24 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Moore. Are you going to throw out a man with a three-and-a- 
half-million-dollar investment? In other words, the sheriff gave him 
a license. He has been operating in the State several years. You 
can't correct overnight a situation that existed prior to your enact- 
ment of a new law. 

In my opinion 

Mr. Halley. Let's see who that left you with. You have got 
Graham and McKay. You have got Frankie Frost at the Keno Turf 
Club, is that right ? 

Mr. Moore. Yes. 

Mr. Halley. He is a Nation-wide hoodlum, isn't he? 

Mr. Moore. Not to my knowledge ; no. 

Mr. Halley. Didn't he originally come from Chicago ? 

Mr. MooRE. At one time he appeared before the commission with 
his attorneys, in Reno, and they cleared about — at least 75 percent 
of those charges that were against him. 

Mr. Halley. Would you say that Wertheimer, from Detroit, is an 
outstanding example of a man who should be running a gambling 
establishment ? 

Mr. MooRE. The only thing I have to know is that the head of the 
FBI, former head of the FBI, from Detroit, Mich., recommended him. 

Mr. Halley. Recommended Wertheimer ? 

Mr. Moore. Yes; stating that he Mas an upstanding man and a man 
of his word, and so forth and so on, and that he had never been in- 
volved in any criminal activity. 

Mr. Halley. Do you believe that? 

Mr. Moore. The head of the FBI is a pretty high man in a certain 
territory, and I would take their word for a lot of things ; yes. 

Mr. Halley. Haven't you ever heard of Wertheimer's gambling 
activities in other States ? 

Mr. Moore. Sure, but, as far as that is concerned, the man gambles. 
That is no sign that he shouldn't have a license in a State where it is 
legal. 

Mr. Halley. It makes no difference to you whether he gambles in 
a State where it is not legal ? 

Mr. Moore. No. How is he going to learn the business ? 

Mr. Halley. In other words, you take the position that, because 
gambling is legal in the State of Nevada, that anybody who has been 
convicted for gambling in other States is not to be considered in any 
way disqualified ; is that right ? 

Mr. Moore. That is right. 

Mr. Halley. Is that a basic policy of the commission ? 

Mr. Moore. Yes. 

Mr. Halley. With regard for people who have been convicted for 
anything else, that doesn't disqualify them so long as they were in 
business here in 1948, is that right? 

Mr. MooRE. That is right. 

Mr. Halley. How do you exclude ? How have you been excluding 
the several hundred? 

Mr. Moore. Every case is an individual case. 

Mr. Halley. Can you give us some examples? 

Mr. Moore. Well, as an illustration, recently a license was denied 
in Reno, principally due to the man's associates in New Jersey. 

Mr. Halley. Who was that ? 



ORGANIZED CRIME IN INTERSTATE. COMMERCE 25 

Mr. Moore. He was connected with, and so on. 

Mr. Halley. Was that Stacher ? 

Mr. MooKE. Stacher. 

Mr. Halley. He is known as Doc Rosen — Stacher? 

uSIr. ]\IoORE. I think he is known as Doc Harris. 

Mr. Halley. There is a Doc Rosen here, too, isn't there? I don't 
want to confuse yon. Tliis is Joseph Stacher; is that right? 

Mr. ]\looRE. That is right. 

Mr. Halley. No more questions, Mr. Chairman. 

The Chairman. I believe that is all, Mr. Moore. Thank you. 

( Witness Moore excused. ) 

The Chairman". Put in the record at this time that the digest is a 
part of the hearings at this point. 

Mr. Halley. May we make it exhibit No. 1, and it will not be typed 
in the record ? 

The Chairman. Exhibit No. 1, racing wire situation in Las Vegas. 
Then this memorandum from the committee which gives all of the 
licensed gambling operations; is that correct? 

Mr. Robinson. No. 

The Chairman. Memorandum for the committee on the certain 
place in Nevada will be marked "Exhibit No. 2." 

(Exhibits Nos. 1 and 2 are on file with the committee.) 

We shall proceed with Clifford Jones, Lieutenant Governor of the 
State of Nevada. 

Mr. Jones, 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. Jones. I do. 

TESTIMONY OF CLIFFOED JONES, LIEUTENANT GOVEENOR 

OF NEVADA 

Mr. Halley. Mr. Jones, your full name is Clifford Jones? 

Mr. Jones. Clifford Aaron Jones is the full name. 

Mr. Halley. You are an attorney ? 

Mr. Jones. I am an attorney at law practicing here in Las Vegas. 

Mr. Halley. You are a member of Jones, Wiener & Jones ? 

Mr, Jones. Jones, Wiener, Jones & Zenoff at the present time. 

Mr. Halley. Where is that located ? 

Mr. Jones. 206 Beckley Building. That is on the corner of First 
and Fremont, here in Las Vegas. 

Mr. Halley. You are Lieutenant Governor of the State of Nevada? 

Mr. Jones. Yes, I am duly elected and qualified. 

Mr. Halley. Do you have any other business ? 

Mr. Jones. Yes, I have. Of course, besides Lieutenant Governor, 
I have an interest in the Thunderbird Hotel, and I have an interest in 
the Golden Nugget, and I have an interest in the Pioneer Club. 

Mr. Halley. Would you state specifically 

Mr. Jones. Or define the interests ? 

Mr. Halley. Yes. 

Mr. Jones. In the Pioneer Club, which is a partnership, I have 21^ 
I)ercent of the partnership interest. 

Mr. Halley. When did you obtain that? 

68958— 51— pt. 10 3 



26 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Jones. I acquired that in September of 1941, before the war 
was opened. 

Mr. Halley. Did you acquire that by purchase ? 

Mr. Jones. Yes, that interest was acquired by purchase, and I also 
am paid 2i/^ percent of the income from the club attorney's fees, which 
was an agreement that was entered into in September of 1941 also, or 
about that time. 

Mr. Halley. Wliat did you pay for your 2^/2 percent ? 

Mr. Jones. $5,000. 

Mr. Halley. $5,000? 

Mr. Jones. Yes. 

Mr. Halley. What other interests do you have ? 

Mr. Jones. In the Golden Nugget I have 1 percent, of the Golden 
Nugget. 

Mr. Halley. When did you acquire that ? 

Mr. Jones. I obtained that in August of 1947. 

Mr. Halley. Did you pay for that ? 

Mr. Jones. Yes. 

Mr. Halley. How much? 

Mr. Jones. The figure was $23,310, approximately. I hope I am 
not held to the odd figure. 

Mr. Halley. That is for 1 percent ? 

Mr. Jones. That was for 1 percent in the partnership at that time, 
which is now a corporation, and I have been issued the stock equivalent 
to 1 percent of the stock. 

Mr. Halley. From whom did you purchase the 1 percent ? 

Mr. Jones. From Guy McAfee. 

Mr. Halley. Was any other consideration paid ? 

Mr. Jones. No, no other consideration. In fact, at that time that 
was the highest price that had ever been paid by anybody for an 
interest in the club. 

Mr. Halley. Has it paid out ? 

Mr. Jones. Pardon? 

Mr. Halley. Has it been a worth-while investment ? 

Mr. Jones. Yes ; it has been a worth-while investment. 

Mr. Halley. What have you received from the Golden Nugget ? 

Mr. Jones. Approximately $12,000 a year up to the present year, 
and I don't know just what I will receive this year because it changed 
its structure from a partnership to a corporation July 1, and I have 
received no dividends from the corporation. 

Mr. Halley. None would be payable yet, I presume. 

Mr. Jones. It would probably be payable if they had made sufficient 
money to declare a dividend. 

Mr. Halley. You don't know whether they did or did not? 

Mr. Jones. They have not declared a dividend since July 1. 

Mr. Halley. Has business been less profitable this year i 

Mr. Jones. I would not say that business has been less profitable. 
However, this changing their structure — they had to build up in the 
corporation sufficient bank accounts, sufficient supplies, back supplies 
of liquor, and so forth, and also they have corporate tax obligations 
which would decrease tlie amount of money received from the venture. 

Mr. Halley. Going back to the Pioneer Club, during the year 1949 
what was your income on the basis of 5 percent of the total net profits ? 

Mr. Jones. I believe approximately $14,000. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 27 

Mr. Halley. So that the Golden Nugget is apparently a much more 
profitable operation? 

Mr. Jones. Well, many times ; yes. In other words, I received about 
as much from 1 percent on the Golden Nugget as I received from 5 
percent of the income of the Pioneer Club, lumping the two interests 
together, making the 5 percent of their income. 

Mr. Halley. What other business interests have you ? 
Mr. Jones. I have an interest in the Thunderbird Hotel. 
Mr. Halley. What is that ? 
Mr. Jones. One of the resort hotels. 
Mr. Halley. I mean, what is the interest ? 
Mr. Jones. The interest amounts to 11 percent of the stock. 
Mr. Halley. When did you acquire that^ 

Mr. Jones. I acquired that — I, together with Mr. Marion B. Hicks, 
owned the land on which the Thunderbird Hotel is built, and he and I 
built the Thunderbird Hotel together, and I acquired the interest in 
the Thunderbird Hotel by virtue of an exchanging of my interest in the 
land and the structure to a certain date for the stock. 

Mr. Halley. In other words, you had a 50 percent interest in the 
building? Is that operated by a holding company ? 

Mr. Jones. In the land I owned one-third of it, and Mr. Hicks owned 
two-thirds of it. 

Mr. Halley. In the building, what did you own ? 
Mr. Jones. In the building, when we first started to build, my 
part — my contribution amounted to 10 percent of the total contribu- 
tion of the people who came into the venture, and I acquired 10 
percent of the stock. Then I later bought 1 percent more, making 
a total of 11 percent. 

Mr. Halley. Wlio are the people in the Thunderbird ? 
Mr. Jones. Marion Hicks, Harry Badger, Victor Sayer, Jacob Kos- 
loff, Joseph Wells, Paul Wagner, James Schuyler, and myself. 1 
think that I have named all of them. 

Mr. Halley. Is there a separate operating company ? 
Mr. Jones. There was a man by the name of Jack Lane, who has 
a very small interest, but he, incidentally, has never signed the part- 
nership agreement. 

Mr. Halley. Are there separate owning and operating companies ? 
Mr. Jones. There are. 

Mr. Halley. When you say you have 11 percent, are you talking 
about the operating company ? 

Ml-. Jones. I am talking about the operating company. I also own 
the same amount of stock in the ownership company. 

Mr. Halley. Does the operating company itself operate all of the 
gambling at the Thunderbird ? 

Mr. Jones. It does. It operates not only the gambling ; it operates 
the bars and it operates the dining room. 

Mr. Halley. Do you have any concessions that you give other 
people ? 

]\Ir. Jones. Yes. 

Mr. Halley. What are they ? 

Mr. Jones. Well, there is a 

Mr. Halley. With particular reference to gambling. 
Mr. Jones. No. 



28 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. No concessions in gambling ? 

Mr. Jones. No, there are none. The other concessions are apothe- 
cary or smoke shop, and a men's ready-to-wear, and a jewehy shop, 
and so forth. 

Mr. Halley. Do you have a commission room ? 

Mr. Jones. There is a horse book operated there ; yes. 

Mr. Halley. Do you liave a commission room ^ 

Mr. Jones. No. 

Mr. Halley. Do you operate the horse book yourself ? 

Mr. Jones. The horse book is operated by the company itself. 

Mr. Halley. How do you handle your lay-off bets ? 

Mr. Jones. I am sorry, but I don't know the answers to those things 
because I am not a gambler and I am not around the hotel or its opera- 
tion. That question I could not answer. 

Mr. Halley. Who is Marion Hicks? How long has he been a resi- 
dent ? Is he a resident now of Las Vegas ? 

Mr. Jones. Yes, he is. 

Mr. Halley. How long has he been here? 

Mr. Jones. He has been a resident — he first came to Las Vegas when 
I first made his acquaintance, in 1938. He came again and I got better 
acquainted with him in 1939. He came here with the expectation of 
building a hotel. Then in 1940 he came here and stayed awhile and 
made his first deal, I believe, on a piece of property for a hotel at that 
time. 

Mr. Halley. Where did he come from ? 

Mr. Jones. Long Beach, Calif. 

Mr. Halley. Had he ever been in the East, an easterner? 

Mr. Jones. No, not in the East. He came from the Middle West. 

Mr. Halley. From where ? 

Mr. Jones. Joplin, Mo. He was born and raised there, and his 
family is still located in Joplin, Mo. 

Mr. Halley. You say he owned two-thirds of the land ; is that right ? 

Mr. Jones. Yes ; that is right. 

Mr. Halley. Does he have other interests as well? 

Mr. Jones. He owned, together with a man by the name of Grayson, 
the El Cortez Hotel. 

Mr. Halley. He apparently came here with very substantial assets. 

Mr. Jones. Tliat was a substantial structure that was built there. 
He came here although he had other stockholders in the El Cortez 
Hotel. 

Mr. Halley. Who is Grayson ? 

Mr. Jones. Johnnie Grayson. I became acquainted with Grayson 
when they came here and when thej built the El Cortez Hotel and I 
have known him off and on since that time. 

Mr. Halley. He had been an operator of the gambling ships off 
California, had he not ? 

Mr. Jones. He had some interest in the gambling ships off Cali- 
fornia, yes; and I believe before that he had been located in Phoenix, 
Ariz. 

Mr. Halley. In a gambling operation? 

Mr. Jones. That I can't say of my own knowledge because I wasn't 
acquainted Avith liim at that time. 

Mr. HALTiicY. Where did you get your wire service for the horse 
book at tlie Thunderbird ? 



ORGANIZED CREVIE IN INTERSTATE COMMERCE 29 

Mr. Jones. It comes tlirongh tlie same agency that the other horse 
books in the city get their service. 

Mr. Halley. That is the Nevada Publishing Co. ? 
Mr. Jones. I assume so. I wouldn't know the details. 
Mr. Halley. Kun by James A. Dunne? 

Mr. Jones. Yes ; that is right. It was a man by the name of Dunne 
that operates it here. I have met him on one occasion. 
Mr. Halley. What does your operation pay for its service ? 
Mr, Jones. I don't know that answer. 
Mr. Halley. Do you know approximately ? 
Mr. Jones. No, I don't. 

Mr. Halley. Can you get that figure for us and phone it in to Mr. 
Ruymann? 

Mr. Jones. Yes. 

Mr. Halley. He will be here. You can reach him at 2 o'clock. 
Mr. Jones. I will phone that figure in to you as soon as I get it. 
It is just a matter of calling. In other words, those are details that I 
don't know. 

Mv. Halley. Surely. The committee would like to have an annual 
audit for the Thunderbird for the years since it began operations. It 
began in 1947 or 1948 ? 

Mr. Jones. It began in — it has been in operation just 2 years. It 
started operating September 2, 1948. It has only operated 2 years. 
]Mr, Halley. Can you let the committee have the annual audit for 
each of those years ? 

Mr. Jones. I can let you have the annual audit for the first year. 
And the other audit, I don't believe, is quite completed, but I will 
furnish it to you as soon as it is completed. 

Mr. Halley. As far as you know, what was the net income or loss 
in 1949? 

Mr. Jones. That was the year ending 1949. The corporation made 
a profit of a little more than $8,000. 

Mr. Halley. That would be the year ending September 1949 ? 
Mr. Jones. August 31, 1949, and the partnership lost approximately 
$8,000. 

Mr. Halley. In the first year of operation ? 
Mr. Jones. In the first year of operation. 
Mr. Halley. ^^'liat about the gross income during its first year ? 
Mr. Jones. That I do not recall. I have seen the figure, but it will 
be evidenced by the statement. 

Mr. Halley. Do any of the stockholders receive salaries ? 
Mr. Jones. Yes. 
Mr. Halley. Do you ? 

Mr. Jones. No ; I never received any salary or any compensation at 
all. I have only been reimbursed for the amount of costs involved 
in the formation of the corporation. Mr. Hicks receives a salary, and 
Mr. Schuyler receives a salary, and as far as I know, and I am certain 
that I would know otherwise, they are the only two stockholders who 
receive a salary from the corporation or the partnership. 

Air. Halley ."^ So far, you have not received any return whatsoever on 
your investment, then? 
Mr. Jones. I have not. 
Mr. Halley. Or any income ? 



30 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Jones. No income or return whatsoever. I might say that the 
income that will be reflected by the second year of operation has been 
reinvested in the enterprise itself. 

Mr. Hallet, One of your partners in yonr law firm is the executor 
for the estate of Benjamin Siegel, is that right ? 

Mr. Jones. I believe he is the attorney for the executor. 

Mr. Halley. Who is the executor ? 

Mr. Jones. The executor is a Dr. Siegel, who is the brother of Ben- 
jamin Siegel, in Los Angeles. 

Mr. Halley. Do you have any familiarity with the details of the 
estate ? 

Mr. Jones. No, but my partner would be available to you. I have 
only scanty knowledge of it. We have rather large offices, six lawyers 
in the office, and we handle a piece of business and we handle it 
throughout, and it is often the case I wouldn't even know the business 
was in the office. But I do know, of course, of this ; I do have scant 
knowledge of it. 

Maybe I could answer your question. I don't know whether these 
things are considered proper for attorneys to answer or not, or whether 
they are considered privileged communication, but we take the attitude 
of cooperation. 

Mr. Halley. The particular question I had is this 

Mr. Jones. I will answer any question that you deem proper. 

Mr. Halley. If you can answer this, fine ; if not, perhaps Mr. Wiener 
can. 

Were you present during the testimony taken here in 1948 with refer- 
ence to the race wire service ? 

Mr. Jones. No ; I was not present. 

Mr. Halley. Have you ever seen that testimony ? 

Mr. Jones. No ; I haven't. 

Mr. Halley. Your brother, who was then a county attorney, was 
active in that ? 

Mr. Jones. He is a partner, but he is not my brother. 

Mr. Halley. That is Robert Jones ? 

Mr. Jones. He is not my brother. I have a brother in the office; 
his name is Herbert. Robert is not my brother. 

Mr. Halley. Is he related to you at all ? 

Mr. Jones. No relation whatsoever. 

Mr. Halley. He was in 1948 county attorney, is that right? 

]\Ir. Jones. He was. 

Mr. Halley. Is he still ? 

Mr. Jones. He still is. His term ends the 31st of next month. 

Mr. Halley. During the course of that investigation, you may have 
heard a man named Rosen came to Las Vegas ? 

Mr. Jones. I am acquainted with Mr. Rosen. I met him. 

Mr. Halley. You have met him ? 

Mr. Jones. Yes. 

Mr. Halley. He succeeded to some of the business interests of 
Bugsy Siegel, is that right? 

Mr. Jones. I don't know of my own knowledge that that is true. 
He — you might say he assumed a position of authority over some of 
these things. 

Mr. Halley. He was a partner of yours at the Golden Nugget, 
wasn't he? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 31 

Mr. Jones. Who was that ? 

Mr. Hallet. Rosen. 

Mr. Jones. Never. 

Mr. Halley. Didn't he have an interest ? 

Mr. Jones. Never has had any interest. 

Mr. Halley. He had an interest in the horse book at the Golden 
Nugget, didn't he? 

Mr. Jones. To answer that, let me explain — and I think it is prob- 
ably what you want to get to — back when the Golden Nugget was 
built, at that time the race wire service was very closely held here. The 
Golden Nugget group, as a partnership, were finding difficulty in get- 
ting service. So they finally leased out the race book on a monthly 
basis. The people who leased the property called their race book 
the Golden Nugget race book, but none of them had anything to do 
with the Golden Nugget, a partnership. 

Mr. Halley. They operated in the same premises ? 

Mr. Jones. They operated on the same premises under a lease or un- 
der a sublease, you might say. None of them were ever connected in 
any way with the Golden Nugget itself or the Golden Nugget part- 
nership or any of the partners in the Golden Nugget. 

Mr. Halley. What were the terms of the lease, do you know ? Did 
they pay on a percentage basis ? 

Mr. Jones. No, they did not pay on a percentage basis. They paid 
on a straiglit monthly rental. 

Mr. Halley. Siegel was one of the owners of that race book ? 

Mr. Jones. Siegel was reputed to be one of the owners of the book ; 
in fact, the largest owner. 

Mr. Halley. To get to the point that we have been trying to get to, 
we understand from the testimony that Rosen succeeded to Siegel's 
interests in that race book and paid no consideration whatsoever to 
the estate. 

Mr. Jones. The inventory of the estate shows the interest in the 
Golden Nugget race book as zero. 

Mr. Halley. Is that a fair appraisal ? 

Mr. Jones. If he owned an interest, it certainly would not be. 

Mr. Halley. Didn't he own an interest ? 

Mr. Jones. Reputedly he owned the largest interest. 

Mr. Halley. Who inventorized the estate? 

Mr. Jones. Well, it seems as though the interests of — in this Gol- 
den Nugget race book — and of course I am testifying purely from 
hearsay, which would not be admissible in court — — 

The Chairman. This is a committee. 

Mr. Jones. We are only trying to get to the facts, and I want to be 
as helpful as possible. 

According to information, the situation existed something like this ; 
that he owned the larger portion of that race book, although it was re- 
puted to be in the name of Solly Soloway, who was a brother-in-law 
of his, but he also, according to the stories that go around, owed the 
book money. So they canceled him out on his debt because it showed 
on the inventory there was nothing of any value there that could be 
inventoried on his estate. 

Mr. Halley. How much money did he owe the book? 

Mr. Jones. That I do not know. 



32 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Was there any tangible evidence of sucli a debt ? 
Mr. Jones. That I can't say either. 

Mr. Halley. Would you ask your partner if he could drop in for 
us for a few minutes this afternoon with that information ? 

Mr. Jones. I will send him over because I think he would be very 
happy to appear. 

Mr. Halley. No other questions. 

The Chairman. Mr. Jones, are there any other matters that you 
can think of that would be of interest to this committee ? 

What about the matter of outsiders trying to horn in out here 
in Nevada ? Do you have much trouble about that ? 

Mr. Jones. No, we never — we have had recently, of course, some 
people who have wanted to move in here because their operations were 
more or less impaired in other places and they looked to this more 
or less as a haven. Fortunately, through the protection of the tax 
commission, we have a pretty good protection against things like that, 
and don't welcome people who, you. know, have operated and have 
had any particularly strong outside connections. I think that our 
liberal laws have been well protected through the tax commission. 

The Chairman. But you blanketed in a lot of racketeers who were 
already doing business ? 

Mr. Jones. Yes; in other words, it is kind of like a grandfather 
clause. They were here in business, and in operation, some of them, 
and had a lot of money invested. In other words, you can't legislate 
them out of business. 

Mr. Halley. You are a member of the bar of Nevada, aren't you ? 

Mr. Jones. Yes. 

Mr. Halley. Is it the law that the commission would have no power 
to refuse a license to anybody who was in business in 1948, or is that 
simply the policy of the commission ? 

Mr. Jones. Well, it was set forth as a policy of the commission, 
in other words. 

Mr. Halley. Was it set forth in the law, or by the commission ? 

Mr. Jones. No, the first law was passed in 19 . Well, of course, 

the law prior to that was more or less a collection law that collected the 
2 percent. Then the tax commission was given some actual authority 
in 1937. It was in very general language, authorizing them to regu- 
late gambling and so on and so forth. The law had no teeth in it, 
to speak of, and in the 1949 law is the one that gives them real power 
over gambling and the right to revoke licenses, the right to hold hear- 
ings, the right to refuse hearings. 

It makes it a very discretionary matter within the power of the 
tax commission. 

Mr. Halley. Under that law you would have no doubt that they 
would be able to refuse a license to somebody even though he had 
been operating in the State prior to the passage of the law ? 

Mr. Jones. They have since that time refused them because of 
offenses. 

Mr. Halley. We are now talking about people who had previously 
been operating. I understood you to give your legal opinion a few 
minutes ago that those who had been operating had an investment 
which under the law couldn't be taken away, and I am simplj^ ques- 
tioning that legal statement. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 33 

Mr. Jones. I think that I would have to say that a license to con- 
duct gambling is so much within, you might say, police power of the 
State, that if they so desired, they could. I would have to refer back 
to the statutes themselves, although I have granted 

Mr. Hallky. So what you are really talking about is the tax com- 
mission at its discretion has decided to allow those who liad previ- 
ously — well, first, that had been here prior to 1949, to continue to 
operate ? 

Mr. Jones. That is right. 

Mr. Halley. Whether or not they were qualified? 

Mr. Jones. That is right. In other words, they have kind of taken 
the attitude that if they had been here and had been operating and had 
conducted themselves properly, that they were qualified by that. 

Mr. Halley. Since you are Lieutenant Governor of the State, I am 
going to presume to ask an over-all policy question, which you may 
or may not see fit to answer. 

Mr. Jones. All right. 

Mr. Halley. It is definitely a statement of opinion. 

Wouldn't you say prior to 1949 a great many undesirable characters, 
with bad police records, were engaged in gambling operations in the 
State of Nevada, such as Graham and McKay, Wertheimer, Bugsy 
Siegel ? I could name a great many more, of course. 

Mr. Jones. Well, of course. 

Mr. Halley. Moe Sedway ? 

Mr. Jones. Some of those I could very definitely concur with you 
on. Some of them are people who have been in the State long before 
I was here, so I wouldn't presume to pass upon their qualifications to 
conduct their business. 

idr. Halley. Well, there had been a lot of people 

Mr. Jones. There were some people that you might say had police 
records and reputations of gambling in other places. But this seems 
to hold true, that people who came here when the State started to 
grow, to gamble in the gambling business, they weren't particularly 
Sunday school teachers or preachers or anything like that from out 
of the State. They were gamblers. In other words, they came here 
to gamble. 

(Short recess.) 

Mr. Halley. We have one more question. 

As a matter of over-all State policy, do you believe it is good policy 
for the State tax commission to allow people whose previous records 
have been bad, to continue in the gambling business in this State for 
the simple reason and the sole reason that they were in that business 
prior to 1949? 

]\[r. Jones. I would say that I believe as long as they conduct them- 
selves properly that I think there is probably no harm comes of it. 

Mr. Halley. That is a difficult question, as to whether they are con- 
ducting themselves properly. Wasn't it your partner who wrote to 
the Governor that he thought they were going to settle their disputes 
by open warfare? 

Mr. Jones. That is correct, and the tax commission did take action 
on that particular subject and eliminated the thing that was causing 
the difficulty and might cause the trouble. 

Mr. Halley. Isn't the thing that was causing the trouble having 
gangsters here who would settle their problems by gang warfare? 



34 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr, Jones. That would be one of the fundamental reasons, yes. 

Mr. Halley. That is not settled simply by allowing them to con- 
tinue under a license provision. 

Mr. Jones. Well, they no longer — the group involved no longer 
continued to operate any race books. I understand that the service 
itself was in different hands, too, as a result of the actual action of the 
tax commission at that time. 

Mr, Halley. Tliose people are still operating in the State, are they 
not ? Aren't the Stearns brothers still operating ? 

Mr. Jones. The Stearns brothers, yes, they are still operating. 

Mr. Halley. They were major parties to the dispute, were they not? 

Mr. Jones. They are the ones who were the ones who were being 
the victims of the situation, not the proponents of the difficulty. In 
other words, they were people who had operated the book and who 
had a place of business and were being denied service arbitrarily. 

Mr. Halley. It was being denied by Sedway and Rosen, is that 
correct ? 

]Mr. Jones. That is right, correct. 

Mr. Halley. Who did you expect to be doing the shooting? 

Mr. Jones. Well, now, I didn't write the letter so I didn't expect 
anybody. I didn't even know the letter was written. 

Mr. Halley. Did you ever discuss it with your partner? 

Mr. Jones. Not until afterward. 

Mr. Halley. Do you know who he thought would be doing the 
shooting ? 

Mr. Jones. I would say this, that I don't think that he expected that 
the shooting would be coming from the Stearns brothers. 

Mr. Halley. Rosen and Sedway had what they wanted. They 
didn't want anything. What motive would they have? 

Mr. Jones. It was an additional situation. In other words, the 
Stearns boys were getting the information anyway. In other words, 
they were having to 

The Chairman. I think we had better put the press off no longer. 
We have put the press off here for a long while, and Mr. Jones is 
going to bring his partner back. 

^Ir. Halley. This afternoon at 2 o'clock. 

The Chairman. So we will excuse you. 

(A press conference was held, following which a recess was taken 
until 2 p. m.) 

afternoon session 

The committee reconvened at 3 p. m., pursuant to the taking of the 
noon recess. 

TESTIMONY OF HENRY PHILLIPS, LAS VEGAS, NEV. 

The Chairman. Mr. Phillips, 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. Phillips. I do. 

Mr. Halley. Where do you live, Mr. Phillips? 

Mr. Phillips. I live here. 

Mr. Halley. In Las Vegas ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 35 

Mr. Phillips. Yes, sir. 

Mr. Halley. You operate the commission room for the Last 
Frontier ? 

Mr. Phillips. I try to operate, but I haven't been doing anything 
since I have been here. I did try to go into business but there is 
nobody to do business with. 

Mr. Halley. How long has it been since there has been nobody to 
do business with ? 

Mr. Phillips. I found it that way since I came in here. I tried it 
out. I haven't been doing any of this kind of business. I just thought 
I would come in here. Mr. Barron asked me. 

Mr. Halley. You had been doing lay-off business in the past, had 
you not ^ 

Mr. Phillips. No, I have been monkeying around, making a bet, 
taking a bet, or something like that. 

Mr. Halley. Your boss here testified that this is a very compli- 
cated and specialized operation, and that the reason they have you 
here is that you are a specialist and that if you weren't you could lose 
him $100,000 a month; is that wrong? 

Mr. Phillips. I am sort of a handicapper, in a way. 

Mr. Halley. You wouldn't try to kid us. You are not trying to 
kid us, are you ? You know the lay-off business, don't you ? 

Mr. Phillips. Just as I told you, I tried to be in the lay-off business, 
and there is no people to do business with. 

Mr. Halley, When did you come here? How long have you been 
here? 

Mr. Phillips. I think it is in the last — it would be about 6 weeks, 
wouldn't it, Mr. Moore ? 

Mr. Moore. We opened the building September 1, and you were 
here at the time it opened. 

The Chairman. Are you doing business for anybody except the 
Last Frontier? 

Mr. Phillips, No. If they would happen to come in here with some 
business, a big bet, I would try to lay it off, if I could. If I couldn't, 
why 

Mr. Halley. Wliat has been your gross business since September 1 ? 

Mr. Phillips. I wouldn't say that I have had over — I would say a 
few thousand dollars? 

Mr. Halley. Altogether ? 

Mr. Phillips. In 1 day. 

Mr. Halley. What has been the total altogether ? 

Mr. Phillips. Well, the total I wouldn't— I think I didn't average 
over — the average would be about five, six, seven hundred dollars a 
day. 

Mr. Halley. With whom do you lay off bets ? 

Mr. Phillips. Any of these rooms downtown that have somebody 
to make a bet with them. 

Mr. Halley. Your phone bill would show where you have been 
calling. Just tell us the names of the people with whom you had 
lay-offs ? 

]Mr. Phillips. If you could get the phone bill, you would see I 
haven't laid off to nojbody. 

Mr. Halley. Do you call people in Los Angeles ? 



36 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Phillips. No, sir. 

Mr. Halley. You have never tried to call anybody in Los Angeles? 

Mr. Phillips. No, sir. 

Mr. Halley. Do you call people in any State other than Nevada? 

Mr. Phillips. I called one fellow in San Francisco. 

Mr. Halley. Who did yon call in San Francisco? 

Mr. Phillips. I have the number here — Cody. 

Mr. Halley. Did you call anybody in New Jersey ? 

The Chairman. What is the San Francisco number? 

Mr. Robinson. Do you know Mr. Hy Goberg? 

Mr. Phillips. Yes, sir. 

M ■. Ror.iNsoN. Did you have any business transactions with him? 

Mr. Phillips. A little, not much. 

Mr. Robinson. Do you lay off with Hy ? 

Mr. Phillips. I don't think I have laid off with Hy since I have sat 
here. I will venture to say I don't think I have laid off $2,000 with him 
since I have been here. 

Mr. Robinson. Do you know Phil Tapper ? 

Mr. Phillips. I don't know much about him. I have seen him 
around Los Angeles whenever I have been down there. 

Mr. Robinson. Do you think any action is laid off from California? 

Mr. Phillips. I don't get from there. 



Mr. Robinson. The action you receive- 



Mr. Phillips. If I got some action, I got some action in the rooms. 
Someone would come in and make a bet. 

Mr. Halley. Do you know Frank Erickson? 

Mr. Phillips. I have seen him in Hot Springs, Ark. 

Mr. Halley. Have you ever done business with him ? 

Mr. Phillips. No, sir. 

Mr. Halley. Do you know^ Tony Gizzo ? 

Mr. Phillips. I don't think I do. 

Mr. Halley. Do you know Harry Russell ? 

Mr. Phillips. Yes ; I do know him Avell. 

Mr, Halley. Have you ever done business with him? 

Mr. Phillips. No ; not that I can remember. 

Mr. Halley. Do you know Tony Accardo ? 

Mr. Phillips. No. 

Mr. Halley. Do j^ou do any lay-off business in New Jersey? 

Mr. Phillips. Never. 

Mr. Halley. Do you do any in Missouri ? 

Mr. Phillips. Never. 

Mr. Halley. You mentioned one man in San Francisco. 

The Chairman. How about Carroll over in East St. Louis ? 

Mr. Phillips. I just know him, introduced to him to say hello. 

The Chairman. Have you ever laid off with him? 

Mr. Phillips. Never laid off with him or had any business with him. 
In fact, I am just a sort of a new man. 

Mr. Halley. In the last week have you made any long-distance 
phone calls from this room ? 

Mr. Phillips. No, sir. 

Mr. Halley. In the last month have you ? 

Mr. Phillips. In the last month I probably made one long-distance 
call to Cody's in San Francisco. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 37 

Mr. Halley. No other long-distance calls ? 

Mr. Phillips. No; not that I can remember, I had one long-dis- 
tance call come in from a small town. Someone bet me $200 on some 
horse, to place on some horse. 

Mr. Halley. We are talking about lay-off betting that you have 
done here. 

Mr. Phillips. No, never. The only lay-off that has been made in 
the place that I am pretty sure of is Cody, and I made a little lay-off 
to Hy's place. 

Mr. PIalley. Where is that? 

Mr. Phillips. In town here. And then sometimes they wouldn't 
take a bet and I would send some fellow downtown to see I wouldn't 
lose too much on a horse. 

Mr. Halley. You haven't made any lay-offs to any other play 
except Cody's outside of Nevada ? 

Mr. Phillips. No, sir. 

Mr. Halley. Where did you work before you came here ? 

Mr. Phillips. Well, to tell the truth, I never worked, just would 
jump around and sit in somebodj^'s office, make a bet on a horse, so 
and so. 

Mr. Halley. Where did you live before you came here ? 

Mr. Phillips. In Los Angeles. 

Mr. Halley. Were you in the booking business there ? 

Mr. Phillips. No, sir. 

Mr. Halley. Did you ever make book in Los Angeles? 

Mr. Phillips. No, sir. 

Mr. Halley. Did you ever handle lay-off bets in Los Angeles? 

Mr. Phillips. No, sir. 

Mr. Halley. I think that is all. Senator. 

The Chairman. When they bring a big bet in here to be laid off, 
do you take care of it j^ourself ? 

Mr. Phillips. I take it and lay it off if I can. If I can't, I tell them 
that I don't want it. It is just like one day Jerry out there, that takes 
care of the book, come to me and he says, "I have got $600 to win and 
$300 to show on some 16-to-l shot." He says, "Can you handle it for 
the office?" And I called up Cody and asked him if he wanted it. He 
says he didn't want it. I called up t]ie office here and they said they 
didn't want it. So I give it back to him. 

The Chairman. Ho-w many phones have you got with long-distance 
connections here? 

Mr. Phillips. Two "Ld.'s". 

Tlie Chairman. Do you have arrsngements made so that you can 
get somebody quick en )ugh if you h ive to get them ? 

Mr. Phillips. Well, suppose so, bi" 1 1 haven't got no outs. That is 
the reason I never care about going into business. 

Mr. Mooke. I might explain, gentl ;men, that this room was put in 
in the beginning, with the idea that there could be lay-off business. 
By the same token, to je perfectly f] ank, you are all running around 
the country investigati ig the race ho rse book and the wire and closed 
all those offices. In addition to that,, there has been one track from 
the time we ojDened up until right recently — it is two tracks now. 

Now, essentially, thee has been no lousiness, when you get right down 
to it. 

Mr. Phillips. You jijot the whole story. 



38 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Moore. There was so little, frankly, that it became obvious after 
the first few days that Mr. Barron said to Mr. Phillips, "This is no 
business." And, frankly, the hotel cut out from it altogether, and 
whatever he takes, it is his. It is a help to us. 

The Chairman. It is an accommodation to you to have somebody 
who will take a big one that you don't want, but what he does is on his 
own? 

Mr. Moore. It brings more business into the race horse book itself. 

Mr. Robinson. Let me clarify something. "Wliat distinction is there 
between the action that is held in the room here and the action that 
comes into Mr. Phillips ? 

Mr. Moore. The action that is held in the room is operated by the 
hotel. 

Mr. EoBiNSON. Is there a limit there to the 

Mr. Moore. There is a limit to what we will take, frankly. 

Mr. Robinson. And what you won't take, you will give to Phillips ? 

Mr. Moore. If he wants it. If not, we say to the customer, there is 
no bet. 

The Chairman. What is the biggest bet you will handle? Of 
course, that depends on the odds ? 

Mr Moore. The odds have a great deal to do with it. 

(Witness Phillips excused.) 

FTJETHEE TESTIMONY OP CLIFFORD JONES, LIEUTENANT 
GOVERNOR OF NEVADA 

Mr. Halley. You have brought us certain information ? 

Mr. Jones. You have asked for information about how much wire 
service cost furnished to the Thunderbird. The race wire service was 
commenced about a year ago, and they paid $100 a week. Four 
months later the rate was increased to $160 a month. 

Mr. Halley. a month or a week ? 

Mr. Jones. A week. That, apparently, was done when the State 
put on a tax of $10 per day for each service outlet. Approximately 
4 months ago the rate was raised to $200 per week with an additional 
charge once each month of $14 being made for a line charge. 

Mr. Halley. So you are now paying about $880 a month total ? 

Mr. Jones. No, $814. 

Mr. Halley. You figure 4 weeks to a month ? 

Mr. Jones. That is correct. 

^Ir. Halley. It would be $800 plus 

Mr. Jones. Now, in checking my list I found that I omitted two 
names. One is L. B. Shear, who owns a very small interest, 2 percent, 
and Guy McAfee, who owns 1 percent. That completes the list. 

Mr. Halley. Go ahead. 

Mr. Jones. I also brought the financial statement of the Thunder- 
bird and the Bonanza Hotels which you requested for the year ending 
August 31, 1949. 

Mr. Halley. Do you know Meyer Lansky? 

Mr. Jones. No, I do not. 

Mr. Halley. Have you ever met him ? 

Mr. Jones. No ; I haven't. 

Mr. Halley. Does he not spend time at the Thunderbird Hotel? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 39 

Mr. Jones. No ; as far as I know, he has never been in the city of 
Las Vegas. 

Mr. Halley. He is reputed to live at the Thunderbird Hotel a great 
deal of the time. 

Mr. Jones. There is a man by the name of Jack Lansky who has 
stayed some time at the Thunderbird Hotel. 

Mr. Halley. That is Meyer Lansky's brother, is it not ? 

Mr. Jones. I assume so. 

Mr. Halley. The man that was convicted for gambling in Florida 
a couple of months ago ? 

Mr. Jones. I don't know that. 

Mr. Halley. Does he stay at the Thunderbird ? 

Mr. Jones. He has stayed there and at the Thunderbird and the 
Last Frontier on different occasions. 

Mr. Halley. In recent years does he stay at the Thunderbird 
exclusively ? 

Mr. Jones. Yes ; I know on the two occasions. 

Mr. Halley. For how long ? 

Mr. Jones. The last time I believe he was here, to my knowledge, 
a couple of weeks. 

Mr. Halley. When was that ? 

Mr. Jones. I don't know, some weeks ago. I would say 3 or 4 weeks 
ago. 

Mr. Halley. Is he a good friend of any of the ow^ners of the 
Thunderbird ? 

Mr. Jones. I think Mr. Hicks knows him, but I don't know how 
well he knows him. 

Mr. Halley. During the early years of the Thunderbird operation, 
it lost a lot of money, did it not? 

Mr. Jones. The first year we lost $84,000 ; yes, sir. 

Mr. Halley. Was there any effort made to obtain fresh capital 
for it? 

Mr. Jones. We put up an additional bankroll ; yes. 

]SIr. Halley. How much did you put up ? 

Mr. Jones. I put up $10,000. 

Mr. Halley. In cash ? 

Mr. Jones. Yes. 

jN'lr. Halley. Was any money borrowed from any outside interests ? 

Mr. Jones. Not that I know of. I did borrow $10,000 from the First 
National Banlc when we put up the first bankroll at the Thundeibird 
Hotel, and the second time they called for money it happened to be 
that I was just ready to pay off my loan at the First National Bank, 
and instead of paying off the loan I turned that money into the 
Thunderbird Hotel and continued to pay on my loan monthly. 

Mr. Halley. Did the Thunderbird obtain any loans from anyone 
else? 

Mr. Jones. Yes ; but the exact amounts I don't Iniow. There was 
some money borrowed from Vic Sayer. There has been some money 
borrowed from Harry Badger, and there was some money that I 
actually loaned above my contribution which amounts only to $4,000, 
I believe, is what I had loaned at one time when I had that amount 
of money, and Mr. Hicks had loaned some money to the Thunderbird 
Hotel. 



40 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Do you know whether Jack Lansky or Meyer Laiipky 
directly or indirectly ever loaned any money to the Thunderbird or 
any of its owners ? 

Mr, Jones. I am certain that they haven't. 

Mr. Halley. You are certain they have not ? 

Mr. Jones. Have not. 

Mr. Halley. Do you know a George Sadlow ? 

Mr. Jones. Yes. 

Mr. Halley. Who is he ? 

Mr. Jones. George Sadlow ? I know that he lives in El Paso, Tex. 
He has been coming and working here in Las Vegas off and on for about 
10, 11 years. He worked at the Las Vegas Club. He worked at the 
El Cortez Hotel for Mr. Hicks, and he has visited the Thunderbird 
Hotel, but never has worked there. 

Mr. Halley. Does he stay at the Thunderbird Hotel ? 

Mr. Jones. Yes, he does. 

Mr. Halley. Has he ever made any investment or loan to the Thun- 
derbird ? 

Mr. Jones. That I can't say. I don't know of any, 

Mr. Halley. Or any of its partners ? 

Mr. Jones, I can only answer as far as myself, as far as I know. 
That might be something that I wouldn't know, 

Mr, Halley. Was it through Sadlow that Lansky came to the 
Thunderbird ? 

Mr. Jones, I might say that Lansky has never been at the Thunder- 
bird unless Sadlow was with him, and I am certain that was through 
Sadlow that Lansky comes to the Thunderbird. He is a very close 
friend of Sadlow's, 

Mr. Halley. Has either Sadlow or Lansky any interest in the 
Thunderbird at this time ? 

Mr. Jones. No. 

Mr. Halley. Does either of them work in any capacity at the 
Thunderbird ? 

Mr. Jones. No. 

Mr. Halley. Do they bring customers to the Thunderbird ? 

Mr. Jones. Except themselves. I say, when they are around the 
place, they spend a great deal of money themselves. 

Mr. Halley. Would you say that either Lansky or Sadlow have no 
financial interest in the Thunderbird ? 

Mr. Jones. As far as I know, none at all. I am certain that Lansky 
has none and I feel just as certain tliat Sadlow has none. I know that 
Mr. Hicks and Mr. Sadlow are very close friends. What might exist 
between them I wouldn't know at this time. In other words, that is 
a question you would have to ask Mr. Hicks because I couldn't answer 
it. 

Mr. Halley. Is Mr. Hicks available? 

Mr. Jones. Yes. He is in town today and he could be reached. 

Mr .Halley. Is he at the Thunderbird ? 

Mr. Jones. Yes. 

Mr. Halley. I have no other questions. 

The Chairman. Do you know whether Frank Costello has or ever 
has had any interest in the Thunderbird ? 

Mr. Jones. I know^ that he has not. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 41 

The Chairman. Does he come in and stay there ? 

Mr. Jones. He has never been in the city of Las Vegas that I know 
of. I know the man only by reading the name in the papers, and 1 
am certain that he hasn't been in Las Vegas, at least to my knowledge. 
He might have been several years ago, bnt I don't think so. I never 
have heard of him ever being here. 

Mr. Halley. Mr. Wiener, we have been inquiring about the e^ate 
of Bugsy Siegel. 

The Chairman. Before you get started, all of our memoranda got 
away somehow. 

What is Mr. Wiener's first name ? 

Mr. Wiener. Louis. 

Mr. Halley. One more question, Mr. Jones. Do you know Phillip 
Kastel? 

Mr. Jones. I have never heard that name before. 

Mr. Halley. You have never heard the name before ? 

Mr. Jones. No. Phil Kastel? 

]\Ir. Halley. Yes. 

Mr. Jones. No ; I have never heard that name before. Is he a local 
person or something like that? 

Mr. Halley. That is all. 

TESTIMONY OF LOUIS WIENER, ATTORNEY, LAS VEGAS, NEV. 

The Chairman. Mr. Wiener, 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. Wiener. I do. 

Mr. Halley. Mv. Wiener, we understand that you are the attorney 
for the executor of the Bugsie Siegel estate, is that correct ? 

Mr. Wiener. That is correct. 

Mr. Halley. And that the inventory of the estate shows that his 
interest in the book, the horse book — is it the Golden Nugget — was 
listed as having no value whatsoever ? 

Mr. Wiener. I have a copy of — zero." Zero, nothing. 

Mr, Halley. As the attorney for the executor, have you ever con- 
tested that listing as that of having no value whatsoever? 

Mr. Wiener. We haven't yet. As a matter of fact, we haven't done 
anything more than to file the original inventory and defend a law- 
suit. We haven't started to close the estate, and it will probably be 
some time before we do. 

Mr. Halley. Is it your opinion that that interest which we under- 
stand was taken over by Rosen has any value or has not? 

Mr. Wiener. Did you ask me for my opinion? 

Mr. PIalley. Your professional opinion as the attorney for the 
executor. 

Mr. Wiener. To be frank with you, I didn't know the agreement 
that existed between the partners. As to the exact agreement that he 
had as to what would happen in the event of one of the partner's 
death, that is. So I can't tell you whether there is an equity there or 
there isn't an equity. 

Mr. Halley. Have you made any effort to find out ? 

INIr. Wiener. No ; I haveir t to date. 

Mr. Halley. How long would it take you to settle an estate? 

68958— 51— pt. 10—4 



42 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Wiener. In this particular State, it would take a consider- 
able number of years because the chief asset of the estate consists of 
promissory notes that were in favor of Siegel and against the Nevada 
Projects Corp. At the present time the Nevada Projects Corp., as its 
only asset, has promissory notes from the present owner of the Fla- 
mingo Hotel, which is the Flamingo Hotel, Inc. 

The Flamingo Hotel, Inc., is paying off the purchase price to the 
Nevada Projects Corp, at the rate of approximately $29,000 or $30,000 
a month, which money goes to the Valley National Bank in Phoenix, 
to be applied, first, to mechanics' liens — first to a loan of $600,000 in 
favor of the Valley National Bank in Phoenix, and mechanics' liens 
that were against the hotel at the time it was sold. And after that, 
after all of the debts in favor of the creditors and the bank had been 
cleared up, then the money will be turned into the Nevada Projects 
Corp. itself for distribution to the stockholders. 

So we will have to wait until the payment by the Flamingo Hotel 
has been completed before we can close the estate, because there is some 
money due and owing to the Government for back taxes, and we 
actually have no cash — well, there is about $3,700, or was $3,700, in the 
bank and that is all there was in cash. So it will be a good many 
months, maybe years, before we can close the estate. 

Mr. Halley. Does the interest that Siegel had in the Pioneer show 
up in the inventory ? 

Mr. Wiener. In the Pioneer Club? He never had one. 

Mr. Halley. He never had an interest in the Pioneer Club ? 

Mr. Wiener. Never. 

]Mr. Halley. Did he have an interest in the Frontier Club ? 

Mr. Wiener. He had an interest in the Frontier turf book — Frontier 
Club turb book. 

Mr. Halley. What was that listed at ? 

Mr. Wiener. $3,353.89. 

Mr. Halley. Did you collect that money from anybody ? 

Mr. Wiener. That money has been collected. That was money 
that was on hand. 

Mr. Halley. Money on hand ? 

Mr. Wiener. That is, in addition to the $3,700 I mentioned that 
was cash. 

Mr. Halley. What percentage of the horse book at the Frontier 
Club did he own ? 

Mr. Wiener. That I do not have, his exact percentage. As I 
remember, he had approximately 20 percent of it. 

Mr. Halley. Was that 20 percent interest listed as having any 
value ? 

Mr. Wiener. Yes; $3,353.89. 

Mr. Halley. That was just money on hand. How about the pro- 
prietary interest ? 

Mr. Wiener. That wasn't listed as having any value. 

Mr. Halley. It would have value, would it not? 

Mr. Wiener. That book, I would say, had no value. That book, 
in my opinion 

Mr. Halley. Wliat would be the basis of your opinion ? 

Mr. Wiener. It hasn't even been able, for the last 3 years, to barely 
pay its rent. In fact, they had to have their rent cut $500 a month a 
while back in order to stay open. 



ORGANIZED CREVIE IN INTERSTATE COMMERCE 43 

Mr. Halley. You are personally familiar with the affairs of the 
Frontier Club? 

Mr. Wiener. That part of it I am. We are the attorneys for them. 

Mr. Halley. Wliat are the assets listed in the inventory for Bugsy 
Siegel? Are they confined in your accounting just to the State of 
Nevada ? 

Mr. Wiener. That is correct. There is some listed in California. 
I believe I have it here. It is nominal. It is personal belongings, 
rings and things like that, that are just personal, that happened to be 
in a safe deposit box down there at the Tax Commission, or whatever 
they have that freezes this — inheritance tax. 

Mr. Halley. Will you state what the assets are? 

Mr. Wiener. They are very limited, whatever they are. I have 
just a letter that was sent as to just what they were. By the way, there 
is — I guess they made him have an original administration down 
there, although Siegel lived here. They required an original adminis- 
tration down there to get that box open. 

It is a yellow clip with a yellow metal Mexican coin. 

Mr. Halley. What I had in mind was the assets here in the State 
of Nevada. 

Mr. Wiener. I thought you asked for 

Mr. Halley. Not jewelry. 

Mr. Wiener. Jewelry — I thought you asked what was in California. 

Mr. Halley. You said it was nominal. 

Mr. Wiener. Just wrist watclies and combs and things like that. 
You want all we have listed here ? 

Mr. Halley. Please. 

Mr. Wiener. There is a balance in a commercial acccount in the 
Union Bank & Trust, in Los Angeles, $3,763.37. There is a check 
drawn on the Farmers & Merchants National Bank in Los Angeles 
in favor of the estate of Benjamin Siegel for $108.73. 

There was 1,000 shares of American Power & Light, subject to a 
collateral due from the Union Bank & Trust Co., Los Angeles, the 
loan being in the sum of $6,375 plus accrued interest, and the net value 
of that $7,055. 

There was one certificate for 100 shares of Nevada Projects, a cer- 
tificate for 95 shares in the Nevada Projects. There is a certificate 
for 25 shares, Nevada Projects. The value of that is zero. There is 
no value at all. 

There is a promissory note dated August 7, 1946, from Nevada 
Projects Corp., the face amount of $113,000, We set the value of that 
at $68,000. 

There is another promissory note from the Nevada Projects in the 
value of $25,000. We set it at $15,000. 

There is an accounts receivable from the same for $22,000, which we 
appraised at $13,200. 

There was a 1946 Chrysler convertible, which we appraised at 
$2,300. I think we sold it for $1,900 through the estate. 

There were some 500 shares of Thikol Corp. stock which we 
appraised 

Mr. Halley. Wliat was that ? 

Mr. Wiener. T-h-i-k-o-1. What that is, I just know that there w^re 
500 shares of stock. 

Senator Tobey. Any Mountain Mining stock there ? 



44 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. "Wiener. No. 

And the interest in the Frontier Turf Club, $3,353.89. 

Mr. Halley. Is that all ? 

Mr. Wiener. The Golden Nugget book at zero. 

Mr. Halley. To get back to the Golden Nugget, you do not con- 
template attempting to obtain that asset for the estate? 

Mr. Wiener. At the present time there hasn't been any move to 
obtain anythiiig. 

Mr. Halley. Wasn't that your responsibility ? 

Mr. Wiener. Not solely. Mr. Siegel — Maury Siegel, who is the 
administrator in the estate — that is, Dr. Siegel — is a resident of Los 
Angeles, Calif., and he has counsel in Los Angeles who also repre- 
sented Siegel in Los Angeles, Joseph Ross. 

Mr. Halley. Wlio? 

Mr. Wiener. Joe Eoss. He is with Pacht, Tannenbaum & Ross. 
He has been giving a lot of the advice from Los Angeles to Mr. Siegel, 
to Maury Siegel. 

Senator Tobey. "VVliat interest did Bugsy Siegel have in the Golden 
Nugget ? 

Mr. Jones. Do you mean in the Golden Nugget race book ? 

Mr. Wiener. I don't know. To my knowledge, there wasn't a writ- 
ten agreement. 

Mr. Robinson. Is there anything in that file that would indicate 
that a Harry Sackman did tax work for Mr. Siegel ? 

Mr. Wiener. Harry Sackman? There is nothing in the file. I 
would say ofi'hand he never did. The only man that I knew did tax 
work for Ben — I can tell you in a minute. I think it was Aaron 
Rosenthal. He is the only one. And then there is a fellow named 
Sam Pott that did some, but I don't think Sackman did. 

Mr. Robinson. Is there anything in the file to indicate that Mr. 
Donald Burcher was the Government agent which Mr. Siegel's tax 
matters were assigned to? 

Mr. Wiener. No; they haven't dealt with me on the tax at all. 
They haven't even contacted me. 

Mr. Halley. Wouldn't you think that an interest in a racing book 
would have some value, particularly at the Golden Nugget? 

Mr. Wiener. They had, as I remember,, only a — just practically a 
month-to-month lease in those places, and under those circumstances 
it would have practically no value because if you are out at the end 
of a month you haven't got anything you can sell. 

Mr. Halley. Didn't you know that Rosen had paid $15,000 by check 
for that interest. 

Mr. Wiener. That he had paid $15,000? 

Mr. Halley. Yes. 

Mr. Wiener. To my knowledge, he didn't pay it. He may have, 
but to my knowledge he didn't pay it. Is it secret to whom he paid It? 
I will say this, he didn't pay it to the estate. 

Mr. Halley. He apparently paid it to the other owners of the book. 

Mr. Wiener. I have some knowledge of that $15,000. That is 
hearsay. 

Mr. Halley, Go ahead. 

Mr. Wiener. He didn't pay $15,000 for the interest. He put up a 
check for $15,000 which was to be used as bank roll. I may say this, 



ORGANIZED CRIME IN INTERSTATE COMMERCE 45 

that at the time of Siegel's death, as I understand, the bank roll was 
very limited. They didn't keep much on hand. I imagine if they 
needed it they always could get $5,000 or $10,000, and they didn't book 
heavy enough so that they would probably lose that much in a day 
or 2 days. 

But when Siegel died I understand that Rosen put up a check for 
$15,000 for bank roll, which I presume they could have cashed at the 
cashier's cage at the Nugget had they needed it, but they never 
cashed it. 

Mr. Halley. You understood that was to be for bank roll rather 
than for his share of the book ? 

Mr. WiENEE. It was never cashed, so I presume that was what it 
was for. 

Mr. Halley. Have you filed an income tax for Siegel ? 

Mr. Wiener. ;Mr. Rosenthal filed that. 

Mr. Halley. What was his income in the year in which he died? 

Mr. Wiener. I don't have a copy. Mr. Rosenthal in Los Angeles, 
the certified public accountant, has that. 

Mr. Halley. Don't you have that information in your mind ? 

Mr. Wiener. I have never seen it. 

INIr. Halley. Do you have any idea of what it was ? 

Mr. Wiener. His income ? 

jMr. Halley. Yes. 

Mr. Wiener. I wouldn't have the slightest idea. His income from 
Nevada would be nothing, I think, because he lost money in the 
Frontier Turf Club and because at the time of his death he owed 
quite a few thousand dollars to the Turf — the Frontier Turf Club, to 
people who had been his partners in the Frontier Turf Club, and they 
filed claims against the estate for it, which were approved. 

Mr. Halley. What was the total amount of those claims ? 

Mr. Wiener. I will tell you in just a moment. One was for — in favor 
of Moe Sedway for $3,843.27. One was in favor of his brother-in-law, 
Solly Soloway, for $2,305 and — excuse me, that wasn't the Frontier 
Turf Club. This was the Golden Nugget ; I am sorry. Mr. Solly Solo- 
wav had $2,805.96 as a claim. And J. K. House had a claim for 
$1,537.30. 

Senator Tobey. Is Sedway a Las Vegas man ? 

Mr. Wiener. Yes. He owns part of the Flamingo Hotel. Their 
claims were moneys due from the deceased, an outgrowth of the de- 
ceased's drawing in excess of the capital in the Golden Nugget claim 
in which the deceased and claimants were partners. 

The Chairman. How did this fellow Rosen take over when Siegel 
got killed ? Did he just move in ? 

Mr. Wiener. As far as I know, he just went down and took over. 

The Chairman. You must know something about it. Who sent 
Rosen in here, anyway ? 

]Mr. Wiener. He was here before Siegel died. He owned an interest 
in the Nevada Projects. 

The Chairman. I thought he came back, though, to Las Vegas right 
after the death of Siegel. 

Mr. Wiener. He was in and out all the time. I couldn't say that 
he came back right after. I think he probably did, but he was here 
after they opened. I think they opened in December of 1946, 1 think 



46 ORGANIZED CRIME IN INTERSTATE COMMERCE 

about the 26th or 2Tth, a few days before New Year's, and they closed 
the end of February, and they opened again the 1st of March ; and he 
was here off and on most of the time. 

The Chairman. Did you find any contract or any agreement or 
anything tliat would justify him to move in and take over Siegel's 
interest ? 

Mr. Wiener. No; as far as contracts between those fellows, they 
just — most of them just don't have contracts. 

The Chairman. Any other questions ? 

Mr. Halley. Were you attorney for the Nevada Projects Corp. 

]Mr. Wiener. Yes. 

Mr. Halley. ^Y[\at was the business of the Nevada Projects Corp. ? 

Mr. Wiener. That is the Flamingo. That is the Flamingo Hotel. 

Mr. Halley. When did you become attorney ? 

Mr. Wiener. I was attorney for the people that owned the property 
who sold it to the Nevada Projects. I was attorney all the time until 
approximately a year ago, and then continued on into the new corpo- 
ration, the Flamingo Hotel. 

Mr. Halley. You are still attorney for the Flamingo ? 

Mr. Wiener. No. 

Mr. Halley. You were up to about a year ago ? 

Mr. Wiener. Yes ; a year, a year and a half maybe. 

Mr. Halley. Who were the owners with Siegel of the Flamingo? 

Mr. Wiener. Morris Rosen held some stock. 

Mr. Halley. Did he hold that stock before Siegel's death ? 

Mr. Wiener. Yes. 

Mr. Halley. Joseph Ross, the attorney in Los Angeles, had some 
stock? 

Mr. Wiener. Moe Sedway had some stock, Solly Soloway had some 
stock, Allen Smiley had some stock; a fellow by the name of Black, 
from Los Angeles, a doctor, I think he is. I don't know him, just 
except to see him. He has some stock. 

Harry Rothberg has some stock, Sam Rothberg — I believe his 
brother — I believe it was Sam had some stock. I think Lansky had 
some. 

Mr. Halley. Did Lansky have some stock ? 

Mr. Wiener. I think he did. 

Mr. Halley. Wliich Lansky ? 

Mr. Wiener. Meyer. 

Mr. Halley. How much stock did he have ? 

Mr. Wiener. That I can't tell you. I can't tell you exactly. It was 
my recollection that it wasn't a large percentage. I mean, there were 
so many in it. Siegel held the largest percentage. I think he held 
about 22 percent. 

Mr. Halley. Did Dave Berman have any stock ? 

Mr. Wiener. No ; he holds some in the present — or held some in the 
present corporation. 

Mr. Halley. Where is Berman from ? 

Mr. Wiener. Minneapolis or Milwaukee, some place. He works at 
the Flamingo. 

Mr. Robinson. A point was reached where Mr. Sanford Adler came 
into a dominent position with respect to the Flamingo ? 

Mr. Wiener. That was after Siegel was out ; that was after he died. 



ORGANIZED CEIJME IN INTERSTATE COMMERCE 47 

Mr. Halley. We are now talking about the owners with Siegel. 

Mr. Wiener. Adler never had anything to do with the Nevada 
Projects. 

Mr. Halley. But Meyer Lansky did; is that right? 

Mr. Wiener. That is the best of my knowledge, 100 shares. 

Mr. Halley. What was the change in ownership after Siegel died ? 

Mr. Wiener. He died in June, the 22d, as I remember. On July — 
about the end of June Mr. Adler and his associates made an agree- 
ment to buy the property from the Flamingo Hotel, Inc. — or from 
the Nevada Projects, for $3,900,000 plus interest and inventory, and 
they formed the Flamingo Hotel, Inc. They made just a little writ- 
ten — short written agreement, paid, I think, $100,000 down. 

Then in July we formed a corporation called Flamingo Hotel, Inc. 
At that time Adler, Charlie Resnick, and some of the other fellows 
that had been a partner with liim in the El Ranclio, together with — 
they were on one group. And then Gus Greenbaum, Moe Sedway, 
Dave Berman, Al Abrams, I think he had 1 or 2 percent. 

Mr. Halley. Gus Greenbaum was the man who runs the wire service 
in Phoenix ; is that right ? 

Mr. Wiener. I don't know whether he does. I knew he came from 
Phoenix and he was over there for a couple of years. I don't know 
if he ran the service. I don't know of my own knowledge. 

They agreed to form this Flamingto Hotel, Inc., and they formed 
it and they were supposed to issue stock, and Adler was supposed to 
have his — his group had about 49 percent of the stock. They had 49 
percent, and they were supposed to get 2 percent, an irrevocable proxy 
to 2 percent of the stock of the other group. 

Adler's group, although they had 49 percent actual ownership, were 
supposed to get a proxy for 2 percent, an irrevocable proxy, so that 
they could have the cnntrol of the policy of the hotel. 

Mr. Halley. Wliat happened to Lansky in this reorganization? 

Mr. Wiener. He wasn't in it. 

]\Ir. Halley. Wlio got his stock ? 

Mr. Wiener. There wasn't any. He has the stock, I presume, in 
Nevada Projects. But they sold 

Mr. Halley. To the new group, and he was just washed out then? 

Mr. Wiener. Then after that — well, yes, unless he held some notes, 
he was washed out because the stock had no value. 

Mr. Halley. After some time Adler left the Flamingo ; did he not? 

]\Ir. Wiener. Yes; about in December of '47 or November of '47, 
somewhere around there, there was a question as to — I know what 
it was. Morris Rosen — they hadn't issued the stock. This stock was 
being issued by Mr. Adler's Los Angeles attorney. We didn't handle 
the issuing of the stock, and he didn't issue the stock for about 5 
months although they had put up their money. Morris Rosen wanted 
his stock issued to him and he was the one that was supposed to give 
*^he proxy of 2 percent of his stock to Adler, and that would give 
them 51 percent in Adler's group and 49 in the other one. And he 
wouldn't — Adler refused — he was the president of the corporation, 
and he refused to issue the stock unless Rosen would, at the same 
time, give an irrevocable proxy for 2 percent, so that he would have 
control. 

They had written this agreement for this irrevocable proxy on a 
piece of scratch paper without any counsel. There was no attorney 



48 ORGANIZED CRIME IN INTERSTATE COMMERCE 

present, and Eosen refused to give up his 2 percent voting rights, 
so Adler refused to issue the stock. And Rosen brought a mandamus 
action in the Supreme Court of Nevada, and we had been the attor- 
neys for the Fhimingo Hotel, Inc., so we represented the hotel, and 
Adler also, so we went to the suju'eme court and fought it out. And 
a day or two before the decision came down — it was never actually 
given — Adler called us out to the hotel and we negotiated — Cliff and 
I negotiated — the sale of their 49 j^ercent to the other group. 

Mr. Halley. Adler left town about that time; didn't he? 

Mr. Wiener. Moved to Eeno. 

Mr. Halley. He has never been back ? 

Mr. Wiener. Yes: he has. He is back looking for a place. 

Senator Wiley. Where does he go ? 

Mr. Wiener. Reno and Lake Tahoe. He has a club in Reno and 
a hotel at the lake, hotel at the lake. 

Mr. Halley. Wasn't Adler threatened with violence by Green- 
baum ? 

Mr. Wiener. Greenbaum? No; absolutely not, to my knowledge. 
I would say absolutely not. 

Mr. Jones. I think what they are trying to get at is the scuffle they 
had. 

Mr. Wiener. The scuffle they had ? That happened on a Saturday 
night. Adler and Rosen had some words. Rosen w^eighs about 140 

Sounds. He is about 5 foot 6 or 7. And Adler weighs about 165. 
[e is about the same size. And they got to arguing one night, and 
I guess one of them took a punch at the other one, and they had a 
little scuffle for about 2 minutes out at the hotel, and that is when 
Adler called us and gave Cliff and I and our other partner the power 
of attorney to negotiate a sale, and the three of us negotiated the sale. 

Senator Wiley. How much did you get for it? 

Mr. Wiener. I think $5,000 or $6,000. 

Mr. Jones. For the equity that existed at that time ? 

Mr. Wiener. It doubled the investment. 

Mr. Jones. They made a profit on the deal. Adler made some 
small profit on the deal. He got his money out with a profit, as I 
recall. 

Mr. Halley. Didn't he threaten to kill Adler if he didn't get out? 

The Chairman. Why was he so anxious to sell after that scuffle? 

Mr. Wiener. He figured they weren't going to get along and in 
a gambling operation if the partners don't get along it is not a very 
good policy to stay in because everybody is handling money. 

Mr. Jones. He controlled a competing business, too. At that time 
he had control of the El Rancho, which was a competitive business, 
and he was favoring one over the other, and so he let the Flamingo 
go and went back to El Rancho to concentrate on that. 

The Chairman. Thank you very much. 

(Witnesses Wiener and Jones excused.) 

TESTIMONY OF L. R. GREESON, CHIEF OF POLICE, RENO, NEV. 

The Chairman. Mr. Greeson, 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. Greeson. I do. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 49 

Mr. Halley. Wliat is your full name ? 

Mr. Greeson. Lawrence Russell Greeson. 

Mr, Halley. You are chief of police at Reno, Nev. ? 

Mr. Greeson. Yes, sir. 

Mr. Halley. How long have you held that position ? 

Mr. Greeson". January 1948. 

Mr. Halley. Do you know a man named Joseph Stacher ? 

Mr. Greeson. Never met him personally ; no, sir. 

Mr. Halley. What do you know about him ? 

Mr. Greeson. The only thing I know about him, sir, is that he 
applied for a gambling license within the State, was to become a 
partner in the Bank Club in Reno. 

The Chairman. In what club ? 

Mr. Greeson. The Bank Club. 

Mr. Halley. Who are the other present owners of the Bank Club ? 

Mr. Greeson. William Graham, James ]MacKay. 

Mr. Halley. They are the two people who were convicted of Fed- 
eral mail fraud in New York ? 

Mr. Greeson. It is my understanding ; yes, sir. 

Mr. Halley. Stacher wanted to become a partner with them in 
the Bank Club? 

Mr. Greeson. There was an additional backer at the time, Sullivan. 
His first name I do not know. But he was to purchase the third 
ownership in it. 

Mr. Halley. What was Stacher's attempt? What did it amount 
to ? Just what did he do and how did you get to have anything to 
do with the matter ? 

Mr. Greeson. My part of it comes in in the investigation of all 
applicants as far as gambling licenses within the city. 

Mr. Halley. Is that under the new State law or a city of Reno law ? 

Mr. Greeson. They are issued licenses by the State, but if any 
investigation shows that they aren't men that should be in, I can satisfy 
the council on that. Then they are not 

Senator Tobey. So you have a negative on the commission ? 

Mr. Greeson. No, sir ; mine is only city. 

Mr. Halley. The law of the State of Nevada requires that any 
gambler must have all licenses in the area in which he operates? 

Mr. Greeson. He must have not only the State, but a city and 
county license in the county that requires it. 

Mr. Halley. Had Stacher received a State license? 

Mr. Greeson. No, sir. 

]Mr. Halley. He was trying to get a license, though, in the city of 
Reno? 

Mr. Greeson. Yes. 

Mr. Halley. And your check found he had a long prison record? 

Mr. Greeson. No; not a long prison record. He was never con- 
victed. He was picked up many times. 

Mr. Halley. A long police record, let us say. 

Mr. Greeson. Yes. 

Mr. Halley. He was an associate of eastern gamblers ? 

Mr. Greeson. That is correct. 

Mr. Halley. What efforts did he make to persuade you to permit 
him to receive a license in Reno ? 



-50 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Greeson". Persuade rne ? I never met the man. 

INIr. Halley. Did yon, directly or indirectly, hear abont efforts 
which he Avas making in Reno ? 

Mr. Greeson". I heard indirectly, I guess. 

Mr, Halley. Will yon state what you know abont the matter? 

Mr. Greeson. The only thing I know is that he apparently paid for 
a third interest in the club. He made direct application to the State, 
and as soon as the State application was— would have cleared, he 
would have made application to the city. 

Senator Tobey. AVho did he pay his money to ? 

Mr. Greeson. This is only hearsay, sir, biit it was supposedly paid 
to Mr, Sullivan, the third owner of the Bank Club. 

Mr. Halley. Do you recall talking about the case with j\Ir. Robin- 
son, here, at the convention of the International Society of Chiefs of 
Police at Colorado Springs ? 

Mr. Greeson. Yes, sir, 

Mr. Halley, Did you tell Mr. Robinson any other things about 
Stacher making certain statements about what he was prepared to 
spend in order to have his way in Reno ? 

Mr. Greeson. There was a reported statement that he was willing 
to spend in the neighborhood of $250,000 to elect or to get in the group 
Vvhich would permit his buying into the club, that is, in the city 
administration. 

Mr, Halley. You say it was a purported statement ? "\'\niat do you 
mean by that ? 

Mr. Greeson. That only come to us as hearsay. 

Mr. Halley. From whom did it come to you ? 

Mr. Greeson. It was common knowledge in town. 

Mr. Halley. Did you deny Stacher's application for a license ? 

Mr. Greeson. Did I deny it ? 

Mr. Halley. Or did you recommend that it be denied ? 

Mr. Greeson. It never came to me. 

Mr. Halley. You say he bought this interest in the club ? 

Mr. Greeson. That is right. 

Mr. Halley. Then he applied for a license ; is that right ? 

Mr. Greeson, To the State. 

Mr. Halley. Did he apply to the city at all ? 

Mr. Greeson. Not as far as I know. Yes — there was an application 
made, although no action is taken within the city until the State acts 
on it. The State denied the application first. 

Mr. Haijley. The State denied it on the basis of his reputation? 
You don't know why it was denied ? 

Mr. Greeson. I know it was denied. 

Mr. Halley. Were you prepared to deny it in any event? 

Mr. Greeson. Yes, sir. 

Mr. Halley. You say it was common knowledge that he said he was 
prepared to spend a quarter of a million dollars to get his way? 

Mr. Greeson. That was statements that were made in the town. As 
to where they originated, I could not know, 

Mr. Halley, Did Stacher leave town ? 

Mr. Greeson. Yes. 

Mr. Halley. You never had an opportunity to talk to him about it? 

Mr. Greeson. No, sir. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 51 

Mr, Halley, Do you know whether he made any effort to persuade 
or otherwise influence any public officials to give him a license or permit 
him to operate ? 

Mr. Greeson. Not within the city. 

Mr. Halley. Did he make efforts in any other place ? 

Mr. Greeson. I do not know. 

Mr. Halley. Did you hear any talk about it ? 

Mr. Greeson. As far as my own knowledge, I couldn't say one way 
or the other, sir. 

Mr. Halley. That is all. 

Senator Wiley. You are the chief of police; is that it? 

Mr. Greeson. Yes, sir. 

Senator Wiley. How long have you been chief of police ? 

Mr. Greeson. Since January 1948. 

Senator Wiley. Of course you are acquainted with the wide open 
gambling here ? 

Mr. Greeson. Yes, sir. 

Senator Wiley. Do you know of any ramifications that would be 
outside the State ? 

Mr. Greeson. You mean with the clubs in Reno itself ? 

Senator Wiley. Yes. 

Mr. Greeson. No, sir ; not in Reno. 

Senator Wiley. You are chief of police at Reno ? 

Mr. Greeson. Yes. 

Senator Wiley. Did you ever hear any talk or rumor to the effect 
that anybody from outside was muscling in ? 

Mr. Greeson. Do you mean trying to get in with the city ? 

Senator Wiley. Yes. 

Mr. Greeson. This is the sample of it here that I have just been 
questioned on. It was my conviction that he was. 

Senator Wiley. That is the only instance you know of ? 

Mr. Greeson. Yes. 

Senator Wiley. Do you know of any connection? Did you hear 
of any connection with trying to muscle into this city here ? 

Mr. Greeson. Well, that is only hearsay 

Senator Wiley. I understand. We are hunting. 

Mr. Greeson. My interest, as I say, sir, is in Reno, and that is my 
specific job. 

Senator Wiley. You intimated, though, in reply to my question, 
that perhaps you heard something about outside interests muscling in 
here. 

Mr. Greeson. You hear of it, yes. As to how much basis there is 
behind it, I don't know. I have enough in Reno in the way of investi- 
gation that I don't liave time to be worried too much about the other 
portions. 

Tlie Chairman, How about Morton and Lou Wertheimer? Don't 
they have interests outside of Nevada ? 

Mr, Greeson, They are in Riverside, in the Riverside Hotel now. 
They at one time had interests outside, I know. 

The Chairman. Where did they have interests ? 

Mr. Greeson. This again is only hearsay. I know they were sup- 
posed to have been in Detroit, Florida, California. 

Senator Tobey, Do you mean the Riverside Inn? 



52 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Greeson. No, they are at the Riverside Hotel in Reno. They 
have a month-to-month basis. Lou Wertheimer is at the Mapes. 

The Chairman. Lou Wertheimer has outside interests, doesn't he? 

Mr, Greeson. I couldn't say, sir. 

The Chairman. You have heard he does ? 

Mr. Greeson. I wouldn't even say that. He had them ; there is no 
question about that. Whether they still exist, I couldn't say. 

The Chairman. Anything else ? 

JNIr. Halley. Nothing else. 

(Witness excused.) 

The Chairman. Mr. Clark is the next witness. Mr. Clark, 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. Clark. I do. 

TESTIMONY OP WILBUR IVERN CLARK, LAS VEGAS, NEV. 

Mr. Haixey. What is your full name ? 

Mr. Clark. Wilbur Ivern Clark. 

Mr. Halley. Your residence? 

Mr. Clark. Las Vegas, Highway 91. 

Mr. Halley. Are you the owner of the Desert Inn, or one of the 
owners ? 

Mr. Clark. Well, that is a corporation. 

Mr. Halley. Are you now employed by that corporation ? 

Mr. Clark. Yes. 

Mr. Halley. Have you any other occupation? 

Mr. Clark. My brother and I have an interest in a cocktail bar in 
San Diego, and a little hotel. 

Mr. Halley. Is the cocktail bar connected with the hotel? 

Mr. Cl.\rk. No. 

Mr. Halley. "WHiere is the hotel ? 

Mr. Clark. I mean the hotel in San Diego. He and I had that 
13 years. 

JSIr. Halley. What is the name of that hotel ? 

Mr. Clark. Barbara Worth. 

Mr. Halley. Do you have any other business interests ? 

Mr. Clark. No. 

Mr. Halley. When did you first begin to build the Desert Inn, Mr. 
Clark? 

Mr. Clark. The actual construction of it ? 

Mr. Halley. Yes. 

Mr. Clark. I believe that was in May of 1947. It was around that 
time. 

Mr. Halley. How was it originally financed ? 

Mr. Clark. I went as far as I could with my money I had, and I 
got some from my brother and two or three other boys that I knew in 
San Diego. 

Mr. Halley. Specifically who put up the original financing? 

Mr. Clark. I did, myself. 

Mr. Halley. What was the original amount of money which you 
invested ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 53 

Mr. Claek. Well, I would liate to say because I don't know exactly. 
I have that on the records, of course. 

i\Ir. Hali^y. What is your best estimate at this time ? 

Mr. Clark. It would be around a quarter of a million, I imagine. 

Mr. Hallet, That was your own money ? 

Mr. Clark. My own money and my brother's and ]Mr. Nary's. 

Mr. Halley. Who is Mr. Nary? 

Mr. Clark. That is a friend of mine from San Diego. 

Mr. Halley. What is his full name ? 

Mr. Clark. Thomas E. Nary. 

Mr. Halley. Were there any other investors? 

Mr. Clark. Yes, Billie Williams. I think it is Alton Williams. 

Mr. Halley. Where is his residence? 

Mr. Clark, It is Las Vegas. 

Mr. Halley. Anyone else ? 

Mr. Clark. Well 

I\Ii*. Halley. We are now talking about the original investment. 

Mr. Clark. No, that is it. 

Mr. Halley. How much did the hotel take to build ? What was the 
total cost before completion? 

Mr. Clark. AVell, I don't know what you mean by that question. 

Mr. Halley. What is the book value of the Desert Inn ? 

JSIr. Clark. I would hate to say. I don't know exactly. 

Mr. Halley. You were in charge of the construction of the build- 
ing, weren't you ? 

Mr. Clark. No, I was there. I wasn't in charge. 

Mr. Halley. Who handled the finances ? 

Mr. Clark. A boy by the name of Allard Rowan. 

jNIr. Halley. Does he own any part of it ? 

Mr. Clark. I don't know whether he has any money in it or not. 

Mr. Halley. What happened to the original $250,000 ? Was that 
placed in a corporation? 

Mr. Clark. Well, there was a corporation formed. I think that 
was just my money in there, and then we formed a corporation but 
never did use the corporation. Then I run out of money again and in 
1949, which w^as — no, let's see — last year I got a fellow to go in with 
me by the name of Rodison, R-o-d-i-s-o-n, and he put in $50,000 and 
was supposed to put in some more, and he wasn't very happy with the 
proposition for some reason, and then these fellows from Cleveland 
come in. 

Mr. Halley. How did they happen to come in ? 

Mr. Clark. I'll tell you 

Mr. Halley. Try to be a little more businesslike in explaining these 
series of transactions about the iinancing, would you mind? 

]\lr. Clark. They are in Reno on a vacation, and of course they 
knew, like everybody in the United States knew, that I was trying 
to get money. I had set there from 1947 to 1949, was sitting there not 
finished. 

]\Ir. Halley. You started building this in 1947, is that right? 

Mr. Clark. 1947. 

Mr. Halley. In 1949 you needed money to finish it, is that right? 

Mr. Clark. I needed money the latter part of 1947, 1 believe it was, 
that I stopped construction. 



54 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Were you unable to obtain any money between then 
and 1949 ? 

Mr. Clark. On that particular piece of property, yes. 

Mr. Halley. And then who were the people who came into it in 
1949? 

Mr. Clark. Well, they are all on record out there. One of them is 
named Sam Tucker, Moe Dalitz, D-a-1-i-t-z, Morris Kleinm.an, and 
Thomas McGinty. And then there is two or three small ones that I 
don't know whether they have money in it or not. I know they are 
in the organization. 

Mr. Halley. Is there a Louis Rothkopf ? 

Mr. Clark. No. 

Mr. Halley. Is there an Anthony Milano ? 

Mr. Clark. No. 

Mr. Halley. Are you sure that neither of them has an interest ? 

Mr. Clark. As far as I know, I have never heard of either men 
that were putting in any money in it. I know they are not in the 
corporation. 

Nr. Halley. How did you happen to meet them ? 

Mr. Clark. Well, let's see; the first time I met them about 3 or 4 
months before, here in Las Vegas, and I put the proposition to them, 
and they didn't like it. They turned it down. 

Mr. Halley. At this time you owned what percentage ? 

Mr. Clark. I had everything up at that time. It was mine, what I 
had built. 

Mr. Halley. Was it a corporation or a partnership ? 

Mr. Clark. I think it was still just myself. Like I told you, we 
started a corporation and we never did use the corporation. 

Mr. Halley. Had you borrowed the money from the other inves- 
tors, such as your brother, or did they have an interest ? 

Mr. Cl-\rk. They were going to get their part of the percentage of 
whatever it amounted to when the place was finished. 

Mr. Halley. Then you began to negotiate with the people from 
Cleveland, is that right ? 

Mr. Clark. That is right. They come here from Reno and I said 
I couldn't do anything because Mr. Rodison is in here and he is sup- 
posed to raise money for me. 

Mr. Halley. Who is Mr. Rodison? 

Mr. Clark. He is the fellow that I started with again in 1949, and 
"if he cares to make a deal with you fellows, that is fine." I said, "All 
I am interested in is getting the place built." 

INIr. Halley. At that point had Mr. Rodison put some money in? 

Mr. Clark. $50,000, yes. 

Mr. Halley. And then did you negotiate with Rodison and the 
Cleveland group ? 

Mr. Clark. I introduced Mr. Rodison to Mr. Kleinman and Mr. 
Dalitz, and they made the deal with Mr. Rodison, and then I had my 
attorney come over from San Diego and made the deal. 

Mr. Halley. What is the present arrangement ? 

Mr. Clark. Well, it is a corporation. I am the president and Mr. 
Kleinman is the vice president, Al Rowan is the secretary, and I be- 
lieve Mr. Dalitz is the treasurer. 

Senator Tobey. How much stock do you own ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 55 

Mr. Clark. I have 25 percent of the stock. I forgot Mr. Krosnick. 
He is also in on this thing, too. JSlr. Krosnick has 4 percent of tliis 
25, and my brother has 2. Mr. Nary has li^, and my brother has 1. So 
how much is that ? I have the rest of 25 percent. 

Mr. Halley. How much money did the Cleveland group invest? 

Mr. Clark. I don't know. I couldn't say that because I wouldn't 
tell the truth. I mean, we have only been open a few months. 

Mr. Halley. You negotiated the deal, did you not ? 

Mr. Clark. I know they were to finish the place. That is all. I 
would be glad to get the books or have the auditors get any of that 
stuff for you, but if I would say, I don't know. 

Mr. Halley'. You mean the deal is that they were to finish the place? 

ISIr. Clark. That is right, 

Mr. Halley. Who put up the bank roll ? 

Mr. Clark. They had to come up with the money. 

Mr. Halley. First you had the man Rodison, who put in $50,000. 
What percentage did he get? 

Mr. Clark. There was no deal made. It was just one of those things. 
If it got into the building 

The Chairman. What we want to know is, what does Mr. Rodison 
have now ? 

Mr. Clark. Mr. Rodison doesn't have anything. 

The Chairman. They paid him out ? 

Mr. Clark. Yes, sir. 

Senator Tobev. How mucli did Kleinman & Co. get? 

Mr. Clark. Kleinman & Co. got 74 percent. A fellow named Her- 
man Greenspun got 1 percent. 

Senator Tobey. How did he get that ? 

The Chairman. Where does he come from ? 

Mr. Clark. Herman Greenspun was a boy around here that I have 
known for a long time, and we started on another piece of property 
that finally wound up being in the total. It is right next to it. It is 
a separate piece of property, and he went out and helped me raise a 
little money, and when this thing all wound up he wound up with 
1 percent of the corporation, and they have 74; Mr. Greenspun 1; 
and I have 25. 

Senator Tobey. That is gross? 

Mr. Clark. That is gross. 

Mr. Halley. Is there a separate operating company aside from the 
owning company? 

Mr. Clark. That is right. There is a company that operates the 
wliole thing, and this is a company that operates this motel part that 
we put into the hotel which Mr. Greenspun has 30 percent of the motel 
part. Tlie corporation has 70 ; I have 25 percent of the 70 percent. 

]\Ir. Halley. The corporation, then, has 70 percent of the motel ? 

Mr. Clark. That is right. 

Mr. Halley. And 100 percent of the gambling, is that right? 

Mr. Clark. Right, the corporation. 

^Ir. Halley. And who runs the restaurants? 

INIr. Clark. Well, it is all run under one management. 

Mr. Halley. Is that in the hands of the corporation or the motel ? 



56 ORGANIZED CRIME IN INTERSTATE COMMERCE 

]Mr. Clark. No, the motel has nothing to do with it. The motel 
has paid off at the rate, I believe, of $1.50 a day per room, and Green- 
spun gets 30 percent of that, and the corporation gets 70. 

Mr. Halley. Do you get any salary ? 

Mr. Clark. Do I get a salary ? Yes. I haven't got one yet. I am 
supposed to get one. We haven't set it up yet. 

Mr. Halley. How long has the Desert Inn been in operation? 

Mr. Clark. Since the 24th of April ; 6i/^ months. 

Mr. Hali.ey. Who is on the premises representing the Cleveland 
group ? 

Mr. Clark. Right now Mr. Tucker is there and Mr. Rowan is there 
and Mr. Jones. But I don't know whether he has a percentage or 
not. I believe he is one of the directors of the company. 

Senator Tobey. Is Kleinman there? 

Mr. Clark. He isn't there. 

Senator Tobey. How recently has he been there? 

Mr. Clark. I think he left last Tuesday. I am not sure. 

Senator Tobey. Where did he go? 

Mr. Clark. That I don't know. 

Mr. Halley. Wliat is your function at the hotel? Wliat do you 
do there? 

Mr. Clark. Well, I am supposed to be the general manager. 

]Mr. Halley. Are you ? 

Mr. Clark. I think so. 

Mr. Halley. Are you also managing the gambling operation ? 

Mr. Clark. Every department has the heads. It is a big corpora- 
tion. 

Mr. Halley. Wlio are the heads? That is what I am attempting 
to ascertain. 

Mr. Clark. Do you mean the heads of each individual department ? 

Mr. Halley. Yes. 

Mr. Clark. The hotel is run by a manager by the name of Stocking. 

Mr. Halley. Under your supervision? 

Mr. Clark. Well, it is under the directors' supervision. 

Mr. Halley. Under what directors? Who are the directors? 

Mr. Clark. If there is anything made that is big, a decision, they 
have a directors' meeting. 

Mr. Clark. Myself. I believe it is Mr. Kleinman and Mr. Dalitz. 

Senator Tobey. You have the most nebulous idea of your business 
I ever saw. You have a smile on your face but I don't know how the 
devil you do it. 

Mr. Clark. I have done it all my life. 

Senator Tobey. Let me ask you this: You just told us that you 
got 25 percent. How much did you pay — how much did you put in 
originally? 

Mr. Clark. Approximate!}^ — I say, I don't know for sure. 

Senator Tobey. I know, approximately. 

Mr. Clark. Around $200,000 or a little more. 

Senator Tobey. So 3^ou got an equity of $200,000 put in originally ? 
These fellows come in and finish the job, an amount you don't know 
anything about. They finish the job. 

Mr. Clark. I know approximately. 

Senator Tobey. He asked you and you said j'ou didn't know. 

Mr. Clark. I don't like to sav because I don't know. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 57 

Senator Tobey. What do yon think approximately? 

Mr. Clark. Well, I know that it costs over a million and a half. 

Senator Tobey. So they put in a million and a half ? 

Mr. Clark. No ; I mean 

Senator Tobey. How much did they put in ? 

Mr. Clark. I think they put in around a million and a half. 

Senator Tobey. And they got 74 percent for the million and a half? 

Mr. Clark. Yes. 

Senator Tobey. And you got 24 percent for your $200,000, is that 
right? 

Mr. Clark. That is right. 

Senator Tobey. What represents the difference, the inequality there? 

Mr. Clark. I don't know. That is the way it is. 

Senator Tobey. Who are the other directors ? Yourself, Kleinman, 
McGinty, Dalitz 

Mr. Clark. Dalitz and 

Senator Tobey. Tucker ? 

Mr. Clark. Well, I don't think Tucker is a director. 

Senator Tobey. How many directors are there altogether? You 
must know that. 

Mr. Clark. There is five in all ; myself and Kleinman and Dalitz, 
Kowan and Jones, is a director. 

Senator Tobey. Then McGinty and Tucker are not directors? 

Mr. Clark. No ; I am sure they are not. 

Senator Tobey. You are the president of the company ? 

Mr. Clark. Yes. 

Senator Tobey. Who is vice president ? 

Mr. Clark. Kleinman. 

Senator Tobey. A^-lio is treasurer ? 

Mr. Clark. Dalitz. 

Senator Tobey. Is Dalitz on the premises regularly ? 

Mr. Clark. No, he has been there several times this week. 

Mr. Halley. Then you are the resident manager, is that right ? 

Mr. Clark. Yes, sir. 

Mr. Halley. Wlio operates the gambling there ? Who is in charge 
of that? 

]\Ir. Clark. Well, we have Mr. Jones. There is a Mr. Williams. 

Mr. Halley. ^Vliat are their full names, please ? 

Mr. Clark. Cornelius Jones, and he represents those fellows, and 
Mr. Williams represents my group, Alton Williams. 

Mr. Halley. And they jointly operate the gambling rooms? 

Mr. Clark. Well, I mean they are in charge at the hotel. It is 
one complete operation. 

Mr. Halley. Are they under your supervision ? 

Mr. Clark. Yes, they are under the directors' supervision. I mean, 
if there is any decisions to be made, it lias got to be made by everyone. 

Mr. Halley. ^A^io is chief executive officer of the company? 

Mr. Clark. I am the president. I don't know. 

Mr. Halley. You must be, then ; are you ? 

Mr. Clark. I don't know just exactly. 

Mr. Halley. Do you have authority as president of the company ? 

Mr. Clark. I have authority to a certain extent, yes. 

Mr. Halley. Is there a chairman of the board of directors? 

Mr. Clark. No. 

68958 — 51— pt. 10 5 



58 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Then you would be the chief officer, woukl you not, as 
president ? 

Mr. Clark. I suppose so. 

Senator Tobey. How often do you have directors meetings ? 

Mr. Clark. I think we have had about three, since. 

Senator Tobey, You have minutes taken of all these meetings, don't 
you, written up and approved each time ? 

Mr. Clvrk. Yes. 

Senator Tobey. Are they on hand? Are they available? 

Mr, Claiik. Well, sure. 

Senator Tobey. That would show the delegation of power, what 
your delegation was and what your strength was ? 

Mr. Clabk. That is right out in the hotel at the auditor's office. 

Mr, Halley. Who is your auditor ? 

Mr. Clark. Sam Wiener & Co., from Los Angeles. 

Mr. Ha llf>y. Who are your counsel for the operation ? 

Mr. Cl^^ri,.. Mr. MacNamee, here in Las Vegas, Leo MacNamee. 

Mr. H \L] EY. "Wliat is the total bank roll for the gambling 
operations? 

Mr. Clark. What is the total? 

Mr. Halley. Yes. 

Mr. Clark. I believe that we have $100,000 bankroll. 

Mr. Halley. Did you put up your share of the bankroll ? 

Mr. Clark. No. 

Mr. Halley. That was part of the deal, that they put up your share 
of the bankroll ? 

Mr. Clark. That is right, 

Mr. Halley. Does your share come out of the profits, or simply 
your end ? 

Mr. Clark. When they get a certain amount of money back, after 
what they put in to make it even. For instance, if the place was sup- 
posed to cost a million dollars, and I had 25 percent, that means that 
they would have to— they would get $750,000 and I would get $250,000. 
But anything they put in over that they are entitled to get out first, 
before I get any profits. 

Mr. Halley. According to, I believe. Life magazine and various 
other publications, a great deal more than ^1,500.000 was invested 
in that building. What was invested, do you know? 

Mr. Clark. You will have to see the books on that. 

Mr. Halley. Could it have been as much as 5 or 6 million dollars ? 

Mr. Clark. I mean, it is right on the books. I told you what I 
thought it was. I am sure it is over a million and half. 

Mr. Halley. You don't think it could be as much as $5,000,000 ? 

Mr. Clark. I know it is not possible to be anyways near, close. It 
is only what I said. 

]\Ir. Halley. In your efforts to raise money to complete the struc- 
ture, who did you approach. 

Mr. Clark. I approached everybody in the United States, almost ? 

Mr. Halley. Did you approach Frank Costello ? 

Mr. Clark. No. 

Mr. Halley. No? 

Mr. Clark. No. 

Mr. Halley. Phil Kastel ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 59 

Mr. Clark. No. 

Mr. Halley. Meyer Laiisky ? 

Mr. Clark. No, 

Mr. Halley. Jack Lansky ? 

Mr. CL.VRK. No, never met any of those gentlemen in my life. 

Mr. Halley. Jack Dragna ? 

Mr. Clark. No. 

Mr. Halley. Mike Accone ? 

Mr. Clark. No. 

Mr. Halley. Did you ever approach Siegel ? 

Mr. Clark. No ; I don't think I ever saw him. 

Mr. Halley. Did you approach any gamblers for financing, and 
if so, who? 

IVIr. Clark. No. I was open to anyone but it was mostly people — I 
even went back to Washington and tried to get money from the RFC. 
I didn't stop any place. 

Senator Tobey. They have done enough things to be called suckers 
without doing that. 

INIr. Halley. Is there any mortgage on the property ? 

Mr. Clark. Yes, we have a $500,000 mortgage. 

Mr. Halley. Who issued that mortgage ? 

Mr. Clark. It is a company in Texas. I don't know what the com- 
pany's name is. 

Mr. Halley. Is it a bank or a mortgage company ? 

Mr. Clark. I think it is a mortgage company. 

Mr. Halley. Did you know that Morris Kleinman has served a 
3-year sentence in Federal prison ? 

Mr. Clark. I have heard that, yes. I don't know it. 

INIr. Halley. Did you know whether or not he was in the gambling 
business in the East ? 

Mr. Clark. By rumors, that is all. 

Mr. Halley. Did you have knowledge of McGinty's background? 

Mr. Clark. No, I hadn't, I never heard of Mr. McGinty. 

Mr. Halley. He is one of your associates, is he not ? 

]Mr. Clark. That is right. 

Mr. Halley. Did you know that he had a bootlegging conviction? 

Mr. Clark. I have heard that; yes, sir. 

Mr. Halley. Did you know that he had operated gambling houses 
in the Fast ( 

Mr. Clark. I mean, I don't know it. Again it is a rumor. 

Mr. Halley. Tucker is another one of your associates, is that right? 

Mr. Clark. Yes. 

Mr. Halley. Did you know that he had been engaged in the gam- 
bling business in the East ? 

Mr. Clark. I had heard the same about Mr. Tucker ; yes, sir. 

Mr. Halley. He has been interested in the gambling casinos in 
Covington, Ky., has he not, across from Cincinnati ? 

Mr. Clark. There has been rumor to that. I can't say that is so. 

Mr. Halley. It may be Newport as well as Covington. Do you 
know tlie area I am talking about? 

IVIr. Clark. Yes, sir. 

Mr. Halley. AVasn't he interested in that area, in gambling casinos 
tliere ? 



60 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Clark. I couldn't say that he was because I don't know. 

Mr. Halley. But you have heard that? 

Mr. Clark. Yes, I have heard that. 

Senator Tobey. Before you got in bed with crooks, to finish this 
proposition, didn't you look into these birds at all ? 

Mr. Clark. Not too much ; no, sir. 

Senator Tobey. You. didn't care wliere the money came from or how 
dirty or rotten, as long as you finished the building, is that it ? 

Mr. Clark. Well, I wanted the building finished. I didn't hear 
anything bad about those fellows. 

Mr. Halley. Dalitz, also, was associated with Kleinman, was he 
not, bootlegging and gambling activity ? 

Mr. Clark. They come out here together. I know nothing about 
their background at all. 

Mr. Halley. Dalitz has a laundry service here, has he not ? 

Mr. Clark. I don't think so. 

Mr. Halley. The Pioneer Laundry Service ? 

Mr. Clark. That is a new one on me. 

Mr. Halley. Has he been in the laundry business in the East ? 

Mr. Clark, I don't know. I have heard that he has been in the 
laundry business. 

Mr. Halley. Wlien these people joined your enterprise, you. know 
that they were people who had operated illegal gambling enterprises 
throughout the country, is that right? 

Mr. Clark. I have heard that, yes. I have never saw them operate 
but I heard that. 

Mr. Halley. When you were building the Desert Inn, did you visit 
a lot of gambling establishments to observe their layout ? 

Mr. Clark. No, no. 

Mr. Halley. You told that to the press, though, didn't you? 

Mr. Clark. No; I told the press nothing. I don't tell the press 
what to write ; they write what they want. 

Mr. Halley. Did you, in fact, visit gambling establishments 
throughout the country ? 

Mr. Clark. No. I used to work as a dealer years ago. 

Mr. Halley. Where did you work as a dealer ? 

Mr. Clark. In 1937 was the last time I ever worked. I worked in 
Saratoga. I believe the place was named Piping Rock. 

Mr. Halley. Who owned it? 

Mr. Clark. I have no idea. 

Mr. Halley. Did you ever meet Frank Costello ? 

Mr. Clark. Never met the man in my life. 

Mr. Halley. You say you never met Meyer Lansky ? 

Mr. Clark. No, sir. 

Mr. Halley. Did you ever meet Joe Adonis ? 

Mr. Clark. No, sir, 

Mr. Halley. Have you ever met Charlie Fischetti ? 

Mr. Clark. No. 

Mr. Halley. Have you ever met Mike Accone ? 

Mr. Clark. No ; I don't know him. 

Mr. Halley. Who employed you to work at the Piping Rock? 

Mr. Clark, I don't know. 1937 is a long time ago. 

Mr. Halley. What other gambling establishments did vou ever 
work in ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 61 

Mr. Clark. Well, to go back to 1932 or 1931, I worked in a place 
called the Edgmont Club in Hollywood. That was in 1931. I worked 
on the old gambling boats in 1932. 

Mr. Halley. Do you mean off the California shores ? 

Mr. Clark. That is right. 

Mr. Halley. Which boats did you work on? 

Mr. Clark. I worked on the Joawiie A. Smith. It burned down. 
And the Monte Carlo — no ; I didn't work the Monte Carlo. It was the 
Tango. I am sorry. 

Mr. Halley. Who were your employers in the Tango? 

Mr. Clark. Clarence Blicer was supposed to be the main fellow, 
but I imagine he had a lot of partners. I don't know. 

Mr. Halley. What kind of dealer were you, what game? 

Mr. Clark. I was a crap dealer at that particular time. 

Mr. Halley. Did you ever deal in any other game? 

Mr. Clark. Yes ; I have dealt the wheel. I have dealt twenty-one. 

Mr. Halley, Where else have you worked as a dealer ? 

Mr. Clark. I broke in as a dealer in 1931 in Reno, at the Bank Club. 

Mr. Halley, Have you ever worked in Florida? 

Mr. Clark. No; never on the east coast, only 30 days in Saratoga. 
That was the only time I was ever East. 

Mr. Halley. You never worked in New Jersey ? 

Mr. Clark. No ; only Saratoga. 

]\Ir. Halley. Where else have you worked ? 

Mr. Clark. I have worked in Palm Springs 3 or 4 years, a place 
called the 139 Club. 

Mr. Halley. Who owned that? 

Mr. Clark. A fellow by the name of Earl Saucer. 

Mr. Haujsy. Did Frank Portmeier have any connection with that ? 

Mr. Clark. No, no. 

Mr. Halley. Portnoy? 

Mr. Clark. Frank Portnoy : I knew Frank Portnoy, but I had no 
connection. 

Mr. Halley. Where else have you worked as a dealer? 

Mr. Clark. I worked at a place in Hollywood, too, called the La 
Boheme. That was in 1933. 

INIr. Halley. You say in 1937 you stopped working. What did you 
do from 1937 on, after j^ou gave up working? 

Mr. Clark, I didn't stop working. 

Mr. Halley. I am just using your words. 

The Chairman". He said he stopped working as a dealer. 

Mr. Clark. Stopped working as a dealer, I said. 

Mr. Halley. What did you do after 1937? 

Mr. Clark. I had this little hotel in San Diego. 

Mr. Halley. When did you acquire that? 

Mr. Clark. That, I believe, in 1936 or 1937. 

Mr, Halley. Were you the sole owner ? 

Mr. Clark. Yes ; up until, I think, 1941, and I cut my brother in for 
half of that. 

Mr. Halley. Wliat other businesses have you had since 1937? 

Mr, Clark. I had four or five cocktail bars in San Diego. 

Mr. Halley. Did you have gambling in any of them ? 

Mr, Clark, No; I had a card room, a legitimate — they called it 
legitimate. They gave you a license to deal draw poker, which isn't 



62 ORGANIZED CRIME IN INTERSTATE COMMERCE 

" against the law in California, in the Monte Carlo. And I also had a 
cardroom around the corner called the Bomber Club. 

Mr. Halley. Did you have any gambling in your hotel? 

Mr. Clark. No. 

Mr. Hallet. Did you know Bompeniero of the Gold Kail, San 

Diego ? 

Mr. Clark. No. 

Mr. Hallet. Do you know the Gold Rail ? 

Mr. Clark. I know the man who built the Gold Rail, but I don't 
know this fellow you are talking about. 

Mr. Halley. You have never met him '? 

Mr. Clark. I couldn't say I didn't. The name didn't hit me at all. 

Mr. Halley. What other businesses have you had? 

Mr. Clark. That is all. 

Mv. Halley. And you were able to amass 

Mr. Clark. I had the El Rancho Vegas Hotel here. I had that 
place for 2 years. 

Mr. Halley. During which 2 years did you have that? 

Mr. Clark. I went there June 15th of 1944 and left there xVpril 1, 
1946. 

Mr. Halley. What did you have there, a lease ? 

Mr. Clark. No; I bought it outright with two other fellows, and at 
the latter part of it I had a lease. 

Mr. Halley. "V^Tio were the other two people ? 

Mr. Clark. Clayton Smith and Sid Barish. 

Mr. Halley. Where were they from ? 

Mr. Clark. Los Angeles. 

Mr. Halley. What businesses had they been in previously? 

Mr. Clark. Clayton Smitli has been a hotel man all his life, and 
Sid Barish in the hotel-brokerage business, I think he calls his business. 

Mr. Halley. How much did you pay for the El Rancho Vegas? 

Mr. Clark. Do you mean in cash or do you mean on paper? 

Mr. Halley. Both. 

Mr. Clark. We paid at the rate of, I believe, $1,000,000, $50,000 
down. 

Mr. Halley. What happened to your interest in the El Rancho 
Vegas ? 

Mr. Clark. I sold out in November or December of 1945 with a 
lease to run the casino until April 1, 1946 ; sold it to Joe Drown, the 
fellow that we bought the place from. 

Mr. Halley. What was the selling price ? 

Mr. Ci^RK. On paper again, if I am not mistaken, it was around 
$1,500,000. Those figures are all down on black and white. I would 
hate to say those things because books is the last of my department. 
I never take any care of that. I always had auditors to do that sort 
of thing, because I am not much of a businessman. 

Mr. Halley. Then you made a profit on the El Rancho deal? 

Mr. Clark. Sure, I had a profit. 

]VXi\ Halley. Did you have a third of that deal? What was your 
interest with yom^ two partners? 

Mr. Clark. I had 45 percent, when we first went in. 

Mr. Halley. What did you have at the end ? 

Mr. Clark. I had 60 percent, and I gave Paul — wait a minute. 
That is right. I gave Paul 15 percent. 



ORGANIZED CRIME IN INTERSTATE. COIVIMERCE 63 

Mr. Halley. As you stated, you made $350,000; is that right? 
Mr. Clark. Who said that ? 

Mr. Halley. The profit on the resale was $350,000 ? 
Mr. Clark. I don't know exactly what it was. I would be glad to 
find out exactly what you want to know. 

Mr. Halley. Was it in the neighborhood of several hundred thou- 
sand dollars ? 

Mx. Clark. Well, yes ; I would say it was. 

Senator Tobey. Is that unusual in your life, to make a profit of a 
quarter of a million dollars ? Is that unusual in your life's experience ? 

Mr. Clark. It is very unusual. 

Senator Tobey. Wouldn't you naturally remember about what it 
was? 

Mr. Clark. No ; it is quite a while ago, you know. 

Senator Tobey. I think it would stand out like a sore thumb. 

Mr. Halley. That is where you got the money to finance the Desert 
Inn ; isn't it ? 

Mr. Clark. That is where I would say I got the most of what I had. 

Mr. Halley. How much cash did you put in the El Kancho deal? 

Mr. Clark. I just told you, $50,000. 

Mr. Halley. How much of that was your own ? 

Mr. Clark. Whatever 45 percent of $50,000 is. 

Mr. Halley. Something under $25,000 ? 

Mr. Clark, That is right. 

Mr. Halley. How much cash did you get out of it on the final sale ? 

Mr. Clark. Again I would have to find out. I got $100,000 at one 
time. That was at the end of it. I mean, when you start asking about 
those figures, I don't know. I would be glad to get them for you. 

Mr. Halley. You got your money back with your share of the profit 
of several hundred thousand dollars ; is that right ? 

Mr. Clark. I got a very nice profit. I don't remember exactly what 
it was. 

]\Ir. Halley. And that is what you used to finance the Desert Inn ? 

Mr. Clark. I guess I had a few dollars that I had saved up over 
my life. 

Air. Halley. That is all. 

The Chairman. In all of this career of yours, did you ever get 
arrested or convicted i 

Mr. Clark. No, sir. 

The Chairman. You always have been fortunate ? 

Mr. Clark. I don't think fortunate. I just never did do anything 
to get arrested. 

Tlie Chairman. Does any of the New York group come and stay 
with you at the Desert Inn ? 

Mr. Clark. There has never been any since we have been there. 
If they have, I don't know. 

The Chairman. Frank Costello, Erickson ? 

Mr. Clark. I have heard of them. 

The Chairman. Machetti, of Chicago? 

Mr. Clark. I don't know any of them at all. I have heard of all 
of them, naturally. I read the papers. 

The Chairman. But they never have been to see you ? 

Mr. Clark. No. sir; not to see me. If they have been in the hotel, 
I don't know. 



64 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. How many guest rooms do you have in the Desert 
Inn? 

Mr. Clark. Approximately 225, I would say. It is very close. 
The Chairman. That is all. 
(Witness excused.) 

TESTIMONY OE MOE SEDWAY, VICE PRESIDENT, ELAMINGO 
HOTEL, LAS VEGAS, NEV. 

The Chairman. Mr. Sedway, 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. Sedwat. I do. 

The Chairman. You have been sick. What is the matter with you ? 

Mr. Sedway. I have had three major coronary thromboses, and I 
have had diarrhea for 6 weeks, and I have an ulcer, hemorrhoids, and 
an abscess on my upper intestines. 

I just got out of bed and I am loaded with drugs. 

Mr. Hauley. I will ask you some questions, Mr. Sedway, and if 
at any point you feel that you are under too great a physical strain, 
you just speak up. 

Mr. Sedway. I will be all right. Thank you. 

Mr. Halley. How old are you, Mr. Sedway ? 

Mr. Sedway. Fifty-seven. 

Mr. Halley. What is your address? 

Mr. Sedway. Flamingo Hotel. 

Mr. Halley. How long have you lived at the Flamingo Hotel ? 

Mr. Sedway. Since 1947. 

Mr. Halley. What is your business ? 

Mr. Sedway. I am vice president of the Flamingo Hotel. 

Mr. Halley. Wliere were you born ? 

Mr. Sedway. I was born in Poland. 

Mr. Halley. Wlien did you come to the United States ? 

Mr. Sedway. 1901. 

Mr. Halley. Are you a citizen ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. When did you become a citizen ? 

Mr. Sedway. I became a citizen on July 16, 1914, by virtue of my 
father's papers. 

Mr. Halley. When you came to the United States, where did you 
go first ? 

Mr. Sedway. New York City. 

Mr. Halley. How long did you live in New York City ? 

Mr. Sedway. I lived in New York City until 1938. 

Mr. Halley. Until 1938? 

Mr. Sedw^ay. Yes, sir. 

Mr. Halley. Then from New York City where did you go? 

Mr. Sedway. I went to California. 

Mr. Halley. To Los Angeles? 

Mr. Sedway. Yes, sir. 

Mr. Halley. How long did you live in Los Angeles ? 

Mr. Sedway. I lived in Los Angeles a little over 2 years. In fact, 
my family is in — lives in Los Angeles now. 



ORGANIZED CRIME IN INTERSTATE. COMMERCE 65 

Mr. Halley. From Los Angeles did you come to Las Vegas ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. And you have lived here ever since? 

Mr. Sedway. Yes, sir. 

Mr. Halley. That would be since 1940? 

Mr. Sedway. About 1941, the latter part of 1941. 

Mr. Halley. If I am going too fast,* you just tell me. We want 
to show proper respect for your health and don't want to hurt you 
in any way physically. 

Mr. Sedway. It is all right. 

Mr. Halley. Were you ever arrested ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. When were you arrested? If you were arrested on 
more than one occasion 

Mr. Sedway. I was never convicted of a felony, if that is what you 
want to know. 

Mr. Halley. I want to know, first, about arrests, and then about 
convictions. 

Mr. Sedway. I was arrested in 1919. 

Mr. Halley. On what charge? 

Mr. Sedway. The charge was unlawful entry. 

Senator Tobey. Is that an immigration case, or breaking and 
entering ? 

Mr. Sedway. No, sir; it was on a Saturday afternoon and we were 
running a crap game in the loft up in the twenties. I don't remember 
what street it was. And it was raided, and I was arrested with one 
other man, charged with unlawful entry. 

Mr. Halley. Were you convicted ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. Did you go to prison ? 

Mr. Sedway. Yes, sir. 

Mr, Halley. For how long ? 

Mr. Sedway. I went to the reformatory for 3 months to 3 years. 
I did a little less than a year. 

Mr. Halley. How old were you at the time, Mr. Sedway ? 

]\Ir. Sedway. I was 22 years old, I think. 

Mr. Halley. Were you ever arrested on any other occasion ? 

Mr. Sedway. Yes. 

Mr. Halley. "V\nien were you next arrested ? 

Mr. Sedway. I was arrested in 1935. 

Mr. Halley. On what charge ? 

Mr. Sedway. Conspiracy. 

Mr. Halley. Were you convicted ? 

Mr. Sedway, No, sir. 

Mr. Halley. What were the facts leading to the arrest, do you 
know? 

Mr. Sedway. Well 

Mr. Halley. Specifically with what kind of conspiracy ? 

Mr. Sedway, Conspiracy to — it was a bond case, 

Mr. Halley, Was it a bond case ? 

Mr, Sedway, Bond, 

Mr. Halley, Bail bond? 

Mr. Sedway. No, security bonds, 

Mr, Halley, You were discharged ? 



66 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sedway. Yes, I was acquitted by a jury. 

Mr. Hallet. T^^iat other arrests have you had ? Perhaps I will go 
through the record with you and we can save a little time. 

Mr. Sedway. I was arrested in 1940 in San Diego for gambling. 

Mr. Halley. On what charge ? 

Mr. Sedway. Gambling. 

Mr. Halley. You were convicted ? 

Mr. Sedway. No, sir. 

Mr. Halley. In 1942, that is, isn't it ? 

Mr. Sedway. Was it 1942 ? 

Mr. Halley. Yes. 

Mr. Sedway. Around that. 

Mr. Halley. What happened to that charge ? 

Mr. Sedway. Nothing happened to it at all. I wasn't convicted. 

Mr. Halley. Were you ever arrested on any other occasion ? 

Mr. Sedway. It was changed to — what do you call it ? 

Mr. Halley. Disorderly conduct ? 

Mr. Sedway, No ; vagrancy. 

Mr. Halley. You wei'e convicted for vagrancy ? 

Mr. Sedway. No, I wasn't. 

Mr. Halley. You were arrested for vagrancy in Albany, too, 
weren't you? 

Mr. Sedway. Yes. 

Mr. Halley. Were you ever arrested for assault and robbery^ 

Mr. Sedway. Not that I know of. They may have charged me 
with it. 

Mr. Halley. Didn't you stay in jail overnight for assault and 
robbery in 1928 in New York ? 

Mr. Sedway. But I was arrested in an office on Broadway, and they 
charged me with assault and robbery of a person and the person was 
called in and failed to identify, and I was released. That is one 
of those things. You are Mr. Halley, aren't you ? In order to hold 
you in New York City, tliey fix — they put a charge on you regardless 
of what it is, to keep you overnight, to bring you into court. 

Mr. Halley. As early as 1917 you were charged with grand larceny, 
isn't that right, and then discharged ? 

Mr. Sedway. Yes. 

Mr. Halley. In 1920 you were charged with burglary and dis- 
charged, is that right ? 

Mr. Sedway. I was discharged — no, I wasn't discharged. That was 
the unlawful entry. 

Mr. Halley. Was that changed ? 

Mr. Sedway. Yes. 

Mr. Halley. Reduced to unlawful entry ? 

Mr, Sedway. Yes, sir. 

Mr. Halley, Then in 1935 you were arrested for vagrancy, is that 
right? 

^fr. Sedway. No, conspiracy. ■ 

Mr. Halley. And discharged ? 

Mr. Sedway. Yes, sir, 

Mr. Halley. Was your name originally Sedwits? S-e-d-w-i-ts? 

Mr. Sedw^ay, Yes. 

Mr. Halley. Is Sedway now your legal name ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 67 

Mr. Sedway, What do yon mean "legal"? I have used it for — 
since 1924. 

JVIr. Halley. Is it the only name you use ? 

Mr. Sedway. Yes. 

Mr. Halley. Then it is your legal name ? 

]VIr. Sedway. Yes. I use it and my children use it in school. 

Mr. Halley. What was your business in New York? You came 
to New York in 1901, is that right ? 

Mr. Sedway. Yes. 

Mr. Halley. At that time how old were you ? 

Mr. Sedway. Seven years. 

Mr. Halley. Did you go to school in New York ? 

Mr. Sedway. Yes. 

Mr. Halley. Did you go through a public school ? 

Mr. Sedway. Yes. 

JNIr. Halley. Did you go through high school ? 

Mr. Sedway. No. I went to high school. I didn't finish. 

]Mr. Halley. Then what business did you go into ? 

Mr. Sedway. Well, I worked around New York in the garment 
industry. 

Mr. Halley. What other businesses were you in during the time 
that vou were in New York? That would be from 1901 to 1938, is 
that right ? 

Mr. Sedway. Yes. 

JMr. Halley. Until you were 45 years old ? 

Mr. Sedway. I used to frequent race tracks, bet on horses. 

Mr. Halley. When did you last have a regular job? 

]Mr. Sedavay. I don't remember ; a long time. 

Mr. Halley. You gave up working and you became a gambler, is 
that right :' 

Mr. Sedway. That is right. 

Mr. Halley. And you also got into various — well, at least one other 
scrape for which you went to jail, is that right ? 

Mr. Sedway. Yes. 

Mr. Halley. After j^ou got out of jail, did you go to work on a 
regular job^ 

Mr. Sedw:ay. Yes, I went in the trucking business. 

Mr. Halley. You were on a payroll, I suppose, for a while ? 

Mr. Sedway. Yes. I went — I bought a truck and I was in the truck- 
ing business with my brother-in-law, and we were delivering mer- 
chandise from the various garment houses. 

Mr. Halley. How long were you in that business ? 

Mr. Sedway. Maybe 2, 3 years. 

Mr. Halley. After that did you have any other business, or did you 
go in for gambling ? 

]VIr. Sedway. Well, I was in a business in 1934. I had a restaurant. 

Mr. Halley. What restaurant did you have? 

Mr. Sedway. Fu Manchu, in New York, Chinese restaurant. 

Mr. Halley. How long did you have that restaurant? 

Mr. Sedway. About a year. 

Mr. Halley. Have you had any other businesses ? 

Mr. Sedway. No. 

Mr. Halley. What did you do when you went to Los Angeles in 
1938 '{ What business were you in there ? 



68 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sedway. Bookmaker. 

Mr. Halley. Were you associated there with Bugsy Siegel? 

]\Ir. Sedway. No, sir. 

Mr. Halley. With whom were you associated in the bookmaking 
business ? 

Mr. Sedway. Myself. I used to go to the race track and take com- 
missions and bet for people and book. 

Mr. Halley. How long have you known Bugsy Siegel? 

Mr. Sedway. Twenty-five years. 

Mr. Halley. You knew him in New York ? 

Mr. Sedway. Yes. 

Mr. Halley. How long have you known Meyer Lansky? 

Mr. Sedway. About the same. 

Mr. Halley. Jack Lansky ? 

Mr. Sedway. The same. 

Mr. Halley. Little Augie Casanno, do you know him? 

Mr. Sedway. Yes. 

Mr. Halley. How long have you known him ? 

Mr. Sedway. The same, 20 years, maybe a little less, about 20. 

Mr. Halley. Do you know Frank Costello ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. How long have you known him ? 

Mr. Sedway. Twenty-five years. 

Mr. Halley. When have you last seen Frank Costello? 

Mr. Sedway. I have seen him about 6 weeks ago. 

Mr. Halley. Wliere? 

Mr. Sedway. In New York. 

Mr. Halley. Where in New York? 

Mr. Sedway. I happened to run into him accidentally in the Plaza 
Cocktail Bar. 

Mr. Halley. Did you talk to him? 

Mr. Sedway. I was sitting with some people. He came over and 
said "hello," and that was the extent of our conversation. He says, 
"How do you feel ?" I says, "How are you, Frank ?" And that was it. 

Mr. Halley. "When did you last see Joe Adonis ? 

Mr. Sedway. Joe Adonis I saw a year ago, at the world series. - 

Mr. Halley. Did you knoAv Nate Kutkin ? 

Mr. Sedway. Yes, I did. 

Mr. Halley. When did you last see him? 

Mr. Sedway. The last time I saw Nate Rutkin was — I was on my 
way to see my sister this last trip, about 6, 7 weeks ago, during the 
Avorld series, and I was in the Pennsylvania Station, and I saw him 
but he didn't see me. And I didn't stop to see him. 

Mr. Halley. When did you last talk to him? 

]SIr. Sedway. The last time I talked to him was the previous year, 
and I met him in Gallagher's Restaurant. 

Mr. Halley. That is where the most of the fellows eat, isn't that 
right ? 

Mr. Sedway. Gallagher's, Moore's. 

Mr. Halley. Do you know Frank Erickson ? 

Mr. Sedway. Yes. 

Mr. Halley. How long have j^ou known him ? 

Mr. Sedway. About 20 years. 



ORGANIZED CRIME IN INTERSTATE, COMMERCE 69 

Mr. Hallet. Have you ever had any biisiness relationship with 
any of them ? Bookmaking or any other business ? 

Mr. Sedway. No. 

Mr. Halley. Have you ever had any kind of financial transaction 
with any of them ? 

Mr. Sedway. No. 

Mr. Halley. Do you know "Longie" Zwillman? 

Mr. Sedway. Yes. 

Mv. Halley. How long have you known him ? 

Mr. Sedway. About 20 years. 

JSIr. Halley, Have you ever had any business with him ? 

Mr. Sedway. No, sir. 

Mr. Halley. Did you ever place a bet with him ? 

Mr. Sedway. No. 

Mr. Halley. Did he ever place one with you ? 

Mr. Sedway. No, sir. 

Mr. Halley. Do you know James Eutkin ? 

Mr, Sedway. Yes. 

Mr. Halley. How long have you known him ? 

Mr. Sedway. The same time. 

Mr, Halley. Harry Stromberg? 

Mr, Sedway. That is the same, 

Mr, Halley, You have known him for about 25 years ? 

Mr. Sedway. Yes. 

Mr. Halley. Have you ever done business with him? 

Mr. Sedway, I have known all these fellows. They were all on 
the East Side, We were all brought up together, 

Mr. Halley, You all went into various gambling businesses, isn't 
that right ? 

Mr, Sedway, Yes. 

Mr. Halley. Were you ever in the liquor business during pro- 
hibition ? 

Mr. Sedway, No ; very small way — nothing. 

Mr. Halley. Did you know Charlie "Lucky" Luciano? 

Mr. Sedway, Yes, sir ; I did. 

Mr. Halley, How long have you known him? 

Mr, Sedway. I have known liim as long as I have known the others, 
I tliink I knew him longer than the others. 

JMr. Halley, Have you ever had an interest in any gambling es- 
tal)lishments in Florida? 

Mr. Sedway, Yes. 

Mr. Halley. Which? 

]Mr. Sedway, In the Hollywood Yacht Club, 

Mr. Halley. Who were your partners there ? 

Mr. Sedway, Julian Kaufman and some local people. 1 don't knovr 
their names, 

Mr, Halley. Do you know Herman Greenspun ? 

Mr, Sedway, No. 

Mr. Halley. Herman Greenspun? 

INIr. Sedway, You don't mean this fellow that has the newspaper, do 
you ? 

Mr. Halley. Yes, 

Mr. Sedway. Hank Greenspun? 



70 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hal-ley. Yes. 

Mr. Sedway, Yes ; I know him. 

Mr. Halley. How long have you known him ? 

Mr. Sedway. Since he has been here. 

Mr. Halley. Does he own any part of the Desert Inn? 

Mr. Sedway. I wouldn't know, sir. 

Mr. Halley. Have you ever seen him there ? 

Mr. Sedway. In the Desert Inn ? I may have. I am not sure. I 
may have. 

Mr. Halley. Where does he come from ? 

Mr. Sedway. I don't know. 

Mr. Halley. New York ? 

Mr. Sedway. I really don't know. 

Mr. Halley. When you went to Los Angeles did you have interest 
in an3^ gambling establishments ? 

Mr. Sedway. No. 

Mr. Sedway. None whatsoever. 

Mr. Halley. None whatsoever? 

Mr. Halley. Did you know Charles Fischetti ? 

Mr. Sedway. Yes. 

Mr. Halley. Rocco Fischetti ? 

Mr. Sedway. Yes. 

Mr. Halley. How long have you known them ? 

Mr. Sedway. I know Charlie longer than I know Rocky. I would 
say 15, 16 years. I can't place the exact time. 

Mr. Halley. Do you know Jack Dragna ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. How long have you known him ? 

Mr. Sedway. I have known him since I have been in Los Angeles. 

Mr. Halley. Have you ever had any business relationship with 
him, or dealings ? 

Mr. Sedway. No, sir. 

Mr. Halley. Mike Accone ? 

Mr. Sedway. I know him. 

Mr. Halley. Have you ever had any business dealings with him? 

Mr. Sedway. No, sir ; haven't talked to him in 10 years. 

Mr. Halley. Did you ever have a bet with him one way or the other? 

Mr. Sedway. No, sir. 

Mr. Halley. Gene Normile ? 

Mr. Sedway. I know Gene. 

Mr. Halley. Any business relationships? 

Mr. Sedway. No, sir, just friendly. 

Mr. Halley. Jake Guzik ? 

Mr. Sedway. I know him. 

Mr. Halley. How long? 

Mr. Sedway. Not very long. 

Mr. Halley. Any business relationship? 

Mr. Sedway. About 10 years ; no. 

Mr. Halley. Tony Corica ? 

Mr. Sedway. Yes, sir. I met him here. 

Mr. Halley. Who introduced you ? 

Mr. Sedway. I don't remember. I think he stayed at the hotel. It 
is the first time I met him. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 71 

Mr. Halley. How long have you known Kleinman ? 

Mr. Sedway. Kleinman, about 20 years. 

Mr. Halley. Where did you first meet him ? 

Mr. Sedway. New York, 

Mr. Halley. Have you ever had a business relationship with him ? 

Mr. Sedway. No, sir. 

Mr. Halley. How long have you know Dalitz ? 

Mr. Sedway. The same time. 

Mr. Halley, Do you know the King boys ? 

Mr. Sedway. No, sir. 

Mr. Halley. From Detroit? 

Mr. Sedway. No. 

Mr. Halley. Do you know Massei ? 

Mr. Sedway. No, I don't. 

Mr. Halley. Do you know who I mean ? 

Mr. Sedway. Yes, Joe Massei. I have never met him. 

Mr. Halley. Never met him? 

Mr. Sedway. No. 

Mr. Halley. Now, when you came to Las Vegas, what was your 
business activity ? What was your business activity in Las Vegas when 
you came here in 194:0 or 1941 ? 

Mr. Sedway. I came here and I had a part interest in the Northern 
Club book. I came here at the request of Ben Siegel. He had bought 
in with Dave Stearns in the Northern Club and he asked me to come 
down here, and he gave me a piece of the book to look out for his in- 
terests. 

]Mr. Halley. He had been in Los Angeles in the meantime, is that 
right? 

Mr. Sedway. Yes, sir. 

Mr. Halley. Were you in any business with him in Los Angeles? 

Mr. Sedway. No, sir. 

Mr. Halley, Were you all by yourself ? No partner ? 

Mr. Sedway. Well, I don't know, mostly by myself; sometimes you 
take a bet with somebody. Would you call it a partner? 

Mr. Halley. Did you lay off your bets with somebody? 

Mr. Sedway. If they were high, I would. 

Mr. Halley. With whom Avould you lay off ? 

Mr. Sedway. Various bookmakers. I don't remember who, exactly. 

Mr. Halley. Name one. 

Mr. Sedway, Irving Moss, but he has been out of business a long 
time. 

Mr. Halley. Did you do any business with Bugsy Siegel at that 
time? 

Mr. Sedway. I was around with him. He did a lot of betting, but 
I didn't do any business with him. 

Mr. Halley. Did he have the race wire at that time? 

Mr. Sedway. Where is that ? 

Mr. Halley. In Los Angeles. 

Mr. Sedway. I don't know. 

Mr. Halley. You don't know? 

Mr. Sedway. No. 



72 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Then you came here at his request to look after his in- 
terest in the book, is that right ? 

Mr. Sedway. That is right. 

Mr. Halley. What was your next business here in Las Vegas? 

Mr. Sedway. My next business here in Las Vegas was — there is a 
fellow by the name of Tony Corica. Was it Tony ? 

Mr. Robinson. That is right. 

Mr. Sedway. He was the representative for Continental. Do you 
know who I mean by Continental ? 

Mr. Halley. The wire service ? 

Mr. Sedway. That is right. His office was in Phoenix. He serv- 
iced Las Vegas. I made a deal with him for a stipulated amount, 
which I think was $900 a week for him to sell me the exclusive rights 
to serve Las Vegas. 

Mr. Halley. Was Siegel in that deal with you ? 

Mr. Sedway. Eventually, yes. 

Mr. Halley. At the inception ? 

Mr. Sedway. No, it was mine. He was in the book with me. If 

you will let me go ahead with my story 

' Mr. Halley. Wliat I am trying to find out is, was that your own 
deal? 

Mr. Sedway. That was my own deal. 

Mr. Halley. How long had you known Corica ? 

Mr. Sedway. Since he was coming up here. He came up here. He 
used to come up here every week. 

Mr. Halley. To collect from you ? 

Mr. Sedway. No, from Stearns and those fellows. 

Mr. Halley. Was that about the time when Annenberg went out 
of the wire service and Eagen took over ? 

Mr. Sedw^ay. No, I think Annenberg went out of the wire service 
long before that. 

Mr. Halley. He went out before 1938, didn't he ? 

The Chairman. '39. 

Mr. Sedway. Well, Annenberg didn't have the wire service — - • 

Mr. Halley. He was out of it a couple of years ? 

Mr. Sedway. Because Ragen had it and Kelley. 

The Chairman. What was Corica's name in Phoenix ? 

Mr. Sedway. W-a-s-h-o-e Publishing Co. 

Mr. Halley. Go ahead. 

Mr. Sedway. There were only two in town. There was the Northern 
Club, which was owned by Dave Stearns, and there was the Las Vegas 
Club, which was owned by J. K. Houssels. There were two books in 
town. 

Mr. Halley. And you had the book in the Las Vegas Club ? 

Mr. Sedway. I had an interest in the book in the Las Vegas Club 
with Siegel. 

Mr. Halley. What was the Las Vegas Club paying ? 

Mr. Sedway. Not in the Las Vegas Club, in the Northern Club, 

Mr. Halley. In the Northern Club ^ 

Mr. Sedway. Yes. 

Mr. Halley. What were you paying for wire service before you 
took it over ? 

Mr. Sedway. I don't know what they were paying, but they weren't 
paying — I wouldn't know that. They probably paid $300 apiece. 



ORGANIZED CRIME IN INTERSTATE. COlSiMERCE 73 

Mr. HALiiEY. $300 apiece. Then you became the exchisive wire serv- 
ice distributor for Las Vegas ? 

Mr. Sedwat. Yes. 

Mr. Halley. What other territory did you have ? 

Mr. Sedway. That is all. 

Mr. Halley. Boulder City, or anything? 

]\Ir. Sedway. There is no gambling in Boulder City. 

Mr. Halley. You paid $900 a week? 

]Mr, Sedway. A week. 

Mr. Halley. What arrangements did j^ou make to sell that wire 
service to the others ? 

Mr. Sedway. The only arrangements I made when I got it, the 
people that owned the Frontier Club asked me if I would put a book 
in there, being I had the wire, if I would put a book in there. And 
their business in Las Vegas then was very bad. And they wanted it 
to bolster their business, and they told me if I put a book in there 1 
can go in there rent free. So I told Siegel about it because he had 
brought me in this other place, and I told him, "Here we have an 
opportunity of going in there and have it 100 percent." 

I said, ''This $900 we are paying, we will split it three ways. Each 
club will pay $300, including expenses — or besides the expenses." I 
don't know the exact amount. "And we will have our own book." 

And he said, "All right." 

I notified Mr. Stearns and Mr. Houssels that I was going to open up 
there, and here is what I am paying for the service and whatever the 
expenses are we will split it three ways, and that we did. 

Mr. Halley. Then, there were three books in Las Vegas ? 

Mr. Sedway. That is right. 

Mr. Halley. The Las Vegas Club, the Frontier Club 

Mr. Sedway. And the Northern Club. 

Mr. Halley. And you had an interest in the Northern Club book, 
you and Siegel? 

Mr. Sedway. That is right. 

Mr. Halley. And you owned 

Mr. Sedway. No, no. 

Mr. Halley. Completely the book in the Northern Club ? 

Mr. Sedway. No ; I had no interest n the Northern Club any more. 

Mr. Halley. You gave that up ? 

Mr. Sedway. Yes. 

Mr. Halley. Who had the Northern Club from then on? 

Mr. Sedway. Stearns. 

Mr. Halley. The Stearns brothers ? 

Mr. Sedway. Yes, 

jVIr. Halley. Did they pay you anything for your interest ? 

Mr. Sedway. No ; I didn't have an interest in the club. Siegel was 
an associate with them. Siegel had bought into the whole club, in- 
cluding the gambling and the book, and I just took care of his interest 
in the book, and all 1 had was an interest in the book. 

Mr. Halley. Did you get any money for your interest in the book 
when you left ( 

Mr.' Sedway. No. 

]SIr. Halley. Wasn't tliat worth sometliing, that interest in the 
book? 

68958—51 — pt. 10 6 



74 ORGANIZED CRIME IN INTERSTATE COIVJUVIERCE 

Mr. Sedway. It was worth more to me to go into this other club 
and have a bigger interest there and have my own book. 

Mr. Halley. In other words, it was part of an all-over deal ; is that 
jight? 

Mr. Sedway. Yes. 

Mr. Halley. What was your next business interest in Las Vegas? 

Mr. Sedway. The next 

Mr. Halley. By the way, what year was it that you got the wire 
service ? 

Mr. Sedway. 1942, 1 think. 

Mr. Halley. Under what name did you operate the wire service? 

Mr. Sedway. Will you refresh my memory? you have it there. I 
■don't remember it. Honestly, I don't. 

I am not quite sure what year, but I did give it a firm name. I don't 
remember what it was. 

Mr. Halley. It wasn't the Nevada Publishing Co., was it? 

Mr. Sedway. No; I was — but we had — we called it — we gave it 
some combination, Nevada and something else. 

Mr. Halley. When did Siegel first get an interest in the wire 
service ? 

Mr. Sedway. Wliat wire service? He had no interest in the wire 
service. 

Mr, Halley. At no time? 

Mr. Sedway. No, sir. The wire service never made any money. 

Mr. Halley. His only interest was in the books ; is that right ? 

Mr, Sedway. That is right. Siegel came down very, very seldom 
to Las Vegas at that time. I ran the book. He had the major part. 
He put up all the money and I ran the book. 

Mr. Halley. What was your next business interest in Las Vegas? 

Mr. Sedway. My next business interest was in the Las Vegas Club. 

Mr. Halley. Will you describe that? 

Mr. Sedway. Yes; Mr. Houssels owned that club and he wasn't 
doing well with it. He wasn't entirely active himself, and I think 
he kept on losing bank roll after bank roll, and I thing he got a little 
tired of it, I talked with him — we were very friendly. We still are 
to this day. And I told him at that time that I thought I could get 
.some people that — to bank roll it, put up the whole bank roll, and 
give him 50 percent. 

He says, "If you do, I will give you 10 percent." 

In other words, it would be 60, 

I called Mr. Greenbaum — you are familiar with him, aren't you ? — 
in Phoenix and told him about the deal, and we went in there and 
operated the club. 

Mr. Halley. What year was that? 

Mr. Sedway. 1913 or 1911. I don't know the year. 

Mr. Halley. In the meantime, what had happened to Corica in 
Phoenix ? Was he with Greenbaum or was he alone ? 

Mr. Sedway. Corica still had this service, and I was doing biisiness 
with liim. Of course, I ran into a lot of trouble with Ragen and 
Kelly, through Mr. Stearns, and they tried to break the contract be- 
cause they thought that Corica didn't have any right to give me a 
contract. However, they 

Mr. Halley. What did they do to try to break the contract ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 75 

Mr. Sedway. They gave an independent wire to Stearns. 

Mr. Halley. Where did he get his wire service, from where did the 
wire come ? 

^Slr. Sedway. Ragen. They were the service. 

Mr. Halley. Did it come direct from Chicago ? 

Mr. Sedway. They just give him a direct wire, and by virtue of my 
contract I sued the Continental, and the Western Union, and the 
supreme court ruled in my favor. 

Mr. Halley. The Supreme Court of Nevada? 

Mr. Sedway. Yes, sir. 

Mr. Halley., What year was that? 

Mr. Sedway. I don't know what year. The records will show. 

Mr. Halley. Was it before Siegel's death ? 

Mr. SEDWAY^ Oh, yes. 

Mr. Halley. Some time before that ? 

Mr. Sedway. Quite some time. 

Mr. Halley. What had led to your break with Stearns ? You were 
on friendly terms with him originally, weren't you, the Stearns boys ? 

Mr. Sedway. Well, on the service he thought he was — he was very 
nice about me going to the Frontier Club, but he tried to put all 
obstacles in my way not to be in business. 

Mr. Halley. When did you start depriving him of wire service? 

Mr. Sedway. I didn't deprive him of wire service. He went out 
and got — he got Ragen and Kelly, and they wound up giving him 
service direct. 

Mr. Halley. And he discontinued using your service? 

Mr. Sedway. He discontinued using my service, and then when the 
court ruled against him, I gave him service again. 

Mr. Halley. You did give him service again ? 

Mr. Sedway. Yes, sir. 

Mr. Halley. Eventually, a time came when you did not give serv- 
ice to Stearns, is that right ? 

Mr. Sedway. I don't remember when I didn't give him any service. 

The Chairman. At the time they had to steal the service. 

Mr. Sedway. That was after my contract ran out, sir. 

Mr. Halley. At that time who had the wire ? 

Mr. Sedway. Connie Hurley. 

Mr. Halley. Connie Hurley had the wire? 

Mr. Sedway. Yes, sir. 

Mr. Halley. But you and Morris Rosen were associated with 
Hurley very closely, weren't you ? 

Mr. Sedway. Not with the wire. 

Mr. Halley. Perhaps we had better go along in order and get it 
straight. 

You were up to the point where you had gotten into, I think, the 
Las Vegas Club. 

Mr. Sedway. Yes. 

Mr. Halley. What happened next? 

Mr. Sedway. Not the book, the whole club. 

Mr. Halley. You got the whole club ? 

Mr. Sedway. Yes ; gambling and everything. 

Mr. Halley. And you put a book in there ? 

Mr. Sedway. The book was in there. 

Mr. Halley. Were you giving it wire service at that time ? 



76 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sedwat. Yes. The book and everything — we got 50 percent 
plus the 10 percent that I got, of the whole club, and put up the bank 
roll, and just went ahead and operated it successfully. 

Mr. Halley. At that time how many clubs had books ? 

Mr. Sedway. Just three. 

Mr. Halley. What were they, the Frontier 

Mr. Sedway. The Frontier, Las Vegas Club, and the Northern 
Club. 

Mr. Halley. You had an interest in the Frontier and the Las 
Vegas ; is that right ? 

Mr. Sedway. I had an interest in the Frontier book. The Fron- 
tier was also a gambling club, and I had an interest in the Las Vegas 
Club gambling house, 

Mr. Halley. Mr. Siegel had an interest in the Northern Club? 

Mr. Sedway. No, sir. 

Mr. Halley. None whatsoever ? 

Mr. Sedway. He severed his interests in the Northern Club at the 
time when we went into the Frontier Club. 

Mr. Halley. So the Northern Club was the one which you gave 
wire service to, but in which you had no interest whatsoever; is that 
right? 

Mr. Sedway. That is right. 

Mr. Halley. What club next got wire service in this city ? 

Mr. Sedway. After the Frontier Club, I don't remember. I don't 
think — we went along that way, I think, for some time without an- 
other club getting wire service. 

Mr. Halley. Did others want the wire service ? 

Mr. Sedway. No, sir. 

Mr. Halley. Nobody wanted it ? 

Mr. Sedway. No, sir. 

Mr. Halley. Did anybody ask you for it? 

Mr. Sedway. Yes ; the next club that got wire service — Stearns was 
dispossessed out of the Northern Club.. He went in with a group into 
the Rex Club, on Second and Fremont. It is now the El Dorado. 
They got wire service. Then the people that bought the Northern 
Club, they retained the wire that Stearns — they said they should 
retain it. So it made it four books then. 

Mr. Halley. Then you had four books ? 

Mr. Sedway. Yes. 

Mr. Halley. What year was that, to your best recollection ? 

Mr. Sedway. 1944, 1945, somewhere along there. 

Ml'. Halley. At tliat time Avhat were you paying for the wire serv- 
ice, still $900 a week? _ . _ 

Mr. Sedway. Maybe more ; it was flexible. I think between $900 and 
$1,200. We were supposed to pay that. 

Mr. Halley. What do you mean, $900 and $1,200? 

Mr. Sedway. The minimum was $900 and its conditions — if more 
wires were out, we were supposed to pay more money. The maximum^ 
I think, was $1,200. I don't remember. 

Mr. Halley. What were you getting paid for the service by these 
various clubs? 

Mr. Sedway. We split it up equally. 

Mr. Halley. I understand that you split it equally between the four 
books ? 



ORGANIZED CRIME IN INTERSTATE COIMMERCE 77 

Mr. Sedway. Yes. 

Mr. Halley. You did not attempt to make a profit on the wire serv- 
ice? 

Mr. Sedway. No, sir ; we didn't make any profit. We had operators 
and expenses, and so forth, and it all balanced out. 

Mr. Halley. What club next got wire service ? 

Mr. Sedway. After the El Dorado ? 

Mr. Halley. Yes. 

Mr. Sedway. You mean the Rex ? 

Mr. Halley. Yes. 

Mr. Sedway. After the Rex, Mr. Stearns got run out of there. 

Mr. Halley. What do you mean by "run out" ? 

Mr. Sedway. He got into a litigation, and they threw him out, and 
new people took that over and retained that book, and he, in turn, 
made a deal with Marion Hicks at the Savoy Club, and he asked for a 
book there, and he got it. 

Mr. Halley. So then you had five books ? 

Mr. Sedway. Five books. 

Mr. Halley. How many books did you have when you finally gave 
up the wire service ? 

Mr. Sedway. When I finally gave up the wire service we had — when 
I gave up the wire service in 194? we had six. 

Mr. Halley. Which was the new one ? 

Mr. Sedway. The Golden Nugget. No, I think there was one other 
one, out in North Las Vegas. It was a very small book. 

Mr. Halley. The Golden Nugget book was owned partly by you and 
Siegel? 

Mr. Sedway. Yes. 

Mr. Halley. How did the book happen to go into the Golden Nug- 
get ? Will you explain that ? 

Mr. Sedway. I was in the Northern Club since 1042, and I was in 
there, and the Northern Club was owned by Mr. McAfee and his asso- 
ciates, but I did most of my business with Mr. McAfee. We were in 
there for 4 years, over 4 years, when Mr. McAfee decided to build 
the Golden Nugget. 

Mr. McAfee told me that when he did that we would have a book 
on it. At one time they decided — they were talking about closing the 
Frontier entirely and making an arcade out of it. 

However, it was kept open for a w^hile as a gambling house, and 
then it was made an arcade, and we ke])t the book in there, which 
was worthless, but we got the book in the Golden Nugget. 

Mr. Halley. Who had the book, you and Siegel and who else? 

Mr. Sedway. I, Siegel, and Soloway and Houssels. 

Mr. Halley. What were your respective interests in that book? 

Mr. Sedway. Houssels had 10 percent. I had 25 percent. Soloway 
had 15 percent, and Siegel had the balance. 

Mr. Halley. How much would that give Siegel ? 

Mr. Sedway. Fifty. 

Mr. Halley. What was the basis for his having 50 as against all 
of the rest of you having 50 together ? 

Mr. Sedway. Because he had the major part of the Frontier Club. 
He had 66% percent of the Frontier and I had a third. He put up 
the original bank roll, and that is the way it was. 



78 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. At that time did you and Siegel have interests in 
any of tlie other books in this city ? 

Mr. Sedway. No, sir. 

Mr. Halley. Just the Golden Nugget and the Frontier Chih? 

Mr. Sedway. That is riglit. 

Mr. Halley. At that time did Siegel have the wire service in Los 
Angeles ? 

Mr. Sedway. I don't think so. I don't know for sure, but I don^t 
think so. He may have. Outside of Las Vegas I don't know any of 
Siegel's business. He had business all over the country, I think, but 
I didn't know of it. 

INIr. Halley. You mean business all over the country? 

Mr. Sedway. I think, but you never questioned Siegel about his 
business. 

Mr. Halley. What kind of business did he have all over the 
country ? 

Mr. Sedway. I don't know what kind of business. I said he may 
have had business all over the country. 

Mr. Halley, You know he had it. 

Mr. Sedway, We all know, but Siegel wasn't the talkative type. 
If I wasn't interested in a business, he didn't discuss that business 
with me, 

Mr, Halley, He had bookmaking business all over the country, 
didn't he ? Don't you know that ? You don't it, do you ? 

Mr. Sedway, I don't know that he had bookmaking. Yes, I doubt 
it. 

Mr, Halley, He certainly had it in Los Angeles, didn't he? 

Mr. Sedway. In Los Angeles? No, sir; I don't think he had book- 
making in Los Angeles, 

Mr, Halley, Do you know of any gambling joints he liad a piece 
of? 

Mr. Sedway. I heard that he had a piece of a gambling joint. 

Mr. Halley. Where? 

Mr. Sedway. I think he had a piece of the race track in Tiajuana. 

Mr. Halley, Anything else? 

Mr. Sedway, And I heard that he had a piece of the Clover Club, 
but I couldn't verify it, couldn't swear that it was so, 

Mr, Halley, Anything else? 

Mr, Sedway, No, not that I know of. 

M'r. Halley. How did you happen to give up the wire ? 

Mr. Sedway, My contract ran out, 

Mr. Halley. When did your contract run out? 

Mr, Sedway, The early part of 1947. 

Mr. Halley. What kind of a contract had you had? 

Mr, Sedway, Written contract. 

Mr, Halley, For how many years? 

Mr. Sedway. Five years. 

Mr, Halley, With no renewal clause? 

Mr, Sedway. No; even during the 5 years I had trouble holding on 
to it. They tried to — during the black-out 

Mr. Halley. You mean when they closed out the track ? 

Mr. Sedway. Closed out the race tracks in the country. Mr. 
Reagan and MV. Kelly insisted that we pay the revemie until racing 
is resumed. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 79 

Mr. Halley. Did you do that? 

Mr. Sedway. We ao;reed on a deal and we did pay it, and when racings 
was resumed he sent his' own man in and I had to work through his 
man in spite of the fact that I had a contract. They closed the original 
place because there was no racing, and then when it was reopened he 
opened his own place and sent his own man down there. 

Mr. Halley. What do you mean, "he opened his own place." 

Mr. Sedway. He had his own operator and his own — his own room 
where the service comes into and that it goes' out to. 

Mr. Halley. Do you mean he brought it into Las Vegas and then 
sold it to you ? 

Mr. Sedway. No : the Western Union wire came in to me, and we, in 
turn, opened an office and put all these instruments in and sent it out 
by loud-speakers to the various clubs. 

]\Ir. Halley. But this is at a time when you were beginning to get it 
from another source than Continental, weren't you? 

Mr. Sedway. No, no. 

Mr. Halley. You were no longer getting the Continental service, 
were you. from Ragen? 

Mr. Sedway. Yes, I was getting it. 

Mr. Halley. Weren't you getting the Trans- America service then ? 

Mr. Sedway. No. I wasn't getting Trans- America service. I didn't 
have anything to do with Trans-America service. 

'Mr. Halley. Didn't you ever get the Trans- America service? 

Mr. Sedway. Did I get it? I must have got it when Ragen didn't 
have his service in here. He had his service in here, but nobody bought 
liis sei'vice when Trans- America came in. 

Mr. Halley. Wlio was handling the Trans- America service? 

Mr. Sedway. Hurley. 

Mr. Halley. Who was handling it in Phoenix ? 

Mr. Sedway. I don't know. 

Mr. Halley. You were buying it from Phoenix, weren't you? 

Mr. Sedway. T was buying it from Hurley. 

Mr. Halley. From Hurley. And where was he ? 

Mr. Sedway. He is here. 

Mr. Halley. That is after he took over your contract ? 

Mr. Sedway. He didn't take over my contract. He made a new 
contract. 

The Chairman. Your contract with Continental expired and you 
went with Trans-America ? 

Mr. Sedway. I didn't go with anybody. 

Mr. Halley. From whom did you purchase service under your 
contract ? 

Mr. Sedway. From Washeo Publishing Co. 

Mr. Halley. At Phoenix? 

Mr. Sedway. Yes. 

Mr. Halley. Did the Washeo Publishing Co. become a Trans- 
America outlet? This is in 1946. before your contract expired. 

Mr. Sedway. I don't know. Not before my contract expired. 

Mr. Halley. Before your contract expired 

Mr. Sedway. Trans- America — I think it was after my contract ex- 
pired, wasn't it? 

Mr. Halley. No. 



80 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sedway. My contract — when my contract expired, even before 
it expired, I had no more control over it. 

Mr. Halley. Why not? 

Mr. Sedway. Because, like I was — like I started to tell you, because 
after that black-out Mr. Ragen opened his own office. I had no 
more control over the operators or anything. They ordered their 
own man to manage it and their own operators. 

Mr. Halley. Did they have any customers ? 

Mr. Sedway. They had all the customers. As a token, they worked 
through me. 

Mr. Halley. You mean you were buying it from Ragen direct ? 

Mr. Sedway. I was buying from the local man — from this Elmer. 

Mr. Halley. Elmer? 

Mr. Sedway. And then, when my contract ran out, I was out en- 
tirely. 

Mr. Halley. Who made the contract with Hurley ? 

Mr. Sedway. Somebody in Continental. I don't know who. I 
think Lynch, Bill Lynch. 

Mr. Halley. Made a contract direct with him ? 

Mr, Sedway. I think so. 

Mr. Halley. Were you present at the hearings held in 1948 here in 
Las Vegas about the wire service ? 

Mr. Sedway. Yes ; I was. 

Mr. Halley. Did you hear considerable testimony about the fact tlmt 
you and Siegel seemed to be the people with whom people had to deal 
to get wire service ? 

Mr. Sedway. Yes. 

Mr. Halley. Would you care to comment about that, Mr. Sedway ? 
WTiat was the situation at the time of these hearings ? 

Mr. Sedway. What was the situation at the time of those hearings? 

Mr. Halley. First, who had the wire service at that time? 

Mr. Sedway. Hurley liad a wire service. 

Mr. Halley. Hurley had it. Wliat was the relationship between 
one Moe Sedway 

Mr. Sedway. At that time Siegel was dead. 

Mr. Halley. And you had a Morris Rosen in there 

Mr. Sedway. That is right. 

Mr. Halley. Who is still your partner in the Flamingo ? 

Mr. Sedway. The situation was this : We had the book at the Golden 
Nugget. Wliile Siegel was alive, I think we paid $1,750 a month rent. 
Then after that, it was raised to $2,500, 1 think. That made it $30,000 
a year. Then they called a meetinji up at the Golden Nugget and they 
said they wanted $60,000 a year. We told them we had just given them 
a raise, but they said, "Well, either take it or leave it.-' And in the 
meantime one of their partners went back to Chicago to talk to Kelly 
to try to get the wire for themselves, so that they could — we wouldn't 
have a wire, so we wouldn't be in the Golden Nugget. 

However, they didn't think we would pay it, and we finally agreed 
upon a price of $50,000 a year. 

Mr. Halley. This was after Siegel died? 

Mr. Sedway. We agree on $50,000 a year. We went along this way 
for several months and then this inquiry was caused to be made. 

Mr. Halley. Why do you think they were trying to put you out of 
business after Siegel died ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 81 

Mr. Sedway. I will tell you. 

Mr. Halley. Was Siegel the boy the}" were afraid of ? 

Mv. Sedway. I think so. 

Mr. Halley. Could you jrive us some details on that, that Siegel 
was the boy they were afraid of? 

Mr, Sedway. I will tell you what hap]Dened. There was only one 
way they could get us out of the Golden Nugget or the Frontier Club, 
because Mr. McAfee — although we didn't have a lease, but we had a 
man's word, which goes a long way in our business. 

JVIr. Halley. You had the wire, though ? 

Mv. Sedway. And Mr. McAfee said that, as long as he had anything 
to do with the Golden Nugget, we will have a book. That was after 
we made the deal for the $50,000. 

Mr. Halley. No ; I am talking about before you made it, while you 
still had Bugsy Siegel with you. 

Mr. Sedway. We had no difficulty when he was alive. 

Mr. Halley. You had no diflSculty at all? 

IVIr. Sedway. No, sir. 

Senator Wiley. Why were they afraid of Siegel? 

Mr. Sedway. I don't know. 

Senator Wiley. Who was afraid of Siegel ? 

Mr. Sedway. They wasn't afraid. They just got along. Whenever 
he made a deal and he kept his word and they went along with him. 

Mr. Halley. Siegel represented a certain amount of muscle from 
Los Angeles, didn't he? 

Senator Tobey. He was a rat, wasn't he? 

Mr. Sedway. A rap? 

Senator Tobey. R-a-t. 

Mr. Sedway. Maybe — I don't know. 

Senator Tobey. He got what was coming to him, didn't he ? Good 
thing, wasn't it? 

Mr. Sedway. I wouldn't comment on it. 

Senator Tobey. I won't make you. 

Senator Wiley. You said someone was afraid of Siegel. 

The Chairman. Would you say that, while Siegel lived, you didn't 
have any trouble, but after Siegel got killed then they started to try 
to edge you out of the Golden Nugget, and the reason you didn't have 
any trouble before that was that they were afraid of Siegel? 

Mr. Sedway. I would presume that, being that we never had any 
difficulty before that, and certainly they don't have to worry about 
me. I am not going to do anything — which we have been out there, 
and I walked away from it, and that was the end. 

The Chairman. They were afraid of Siegel, so they didn't bother 
him, but they weren't so afraid of you ; is that the thing? 

Mr. Sedway. I don't 

The Chairman. Let's get on. 

Mr. Halley. Go ahead. 

Mr. Sedway. Anyway, in order to get us out, there was one way 
to get us out, and that is to cause an inquiry to be held and through 
that inquiry to revoke our license. So they conspired 

Mr. RuYiMANN. Whom do you mean by "they" ? 

Mr. Sedway. People here in town conspired, and the district attor- 
ney wrote a letter to the Governor. First they tried to get the mayor 
to write the letter but I don't think the mayor wanted to write it. 



82 ORGANIZED CRIME IN INTERSTATE COMJMERCE 

The district attorney wrote a letter that the situation in Las Vegas 
was unhealthy on account of the race-horse books, the race-horse wire. 

Mr. Halley. How long have you known Connie Hurley ? 

Mr. Sedway. I have known him since I was in Los Angeles, maybe 
the latter part of — yes, w^hile I was in Los Angeles. I didn't know 
him before that. 

Mr. Halley. Did you meet him through Siegel ? 

Mr. Sedway. I think so; yes. 

Mr. Halley. He was one of Siegel's people; is that right? 

Mr. Sedway. He was friendly with him ; yes, very. 

Mr. Halley. He was one of Siegels' gang, wasn't he ? 

Mr. Sedway. I don't know. 

Mr. Halley. They did business together? 

Mr. Sedway. Connie is not a gangster. 

Mr. Halley. What is Connie ^ 

Mr. Sedway. He has been a bookmaker all his life. 

Mr. Halley. And Siegel's business was bookmaking wasn't it? 
That was one of his businesses ? 

Mr. Sedway. Siegel's business was everything. I can't comment 
on what Siegel's business was. 

Mr. Robinson. At the time the conflict w^as going on with respect 
to the Golden Nugget and your rent was increased to $60,000 

Mr. Sedway. To $50,000. 

Mr. Robinson. Well, it was upped to 60 and down to 50 thousand 
dollars? 

Mr. Sedway. Yes. 

Mr. Robinson. At that time wasn't Dave Stearns trying to get 
service for the Santa xinita Bar? 

Mr. Sedway. Yes. 

Mr. Robinson. Did you ever approach Dave Stearns and have any 
discussion with him on the basis of buying the Santa Anita Bar in 
order to get the service in there ? 

Mr. Sedway. No, sir. 

Mr. Robinson. Did you suggest to him that the Frontier and the 
Santa Anita be combined by breaking through the wall? 

Mr. Sedway. I did not. 

Mr. Robinson. Weren't there discussions 

Mr. Sedway. I think Mr. Rosen did. You see, when we made this 
deal up at the Golden Nugget, one thing they made very clear to us, 
they made very clear to us that, "There is to be no more, books on 
the street." They didn't want any more books. 

Mr. Robinson. Who said that? 

Mr. Sedway. The crowd up at the Golden Nugget, that meeting. 

Mr. Robinson. What meeting was this? 

Mr. Sedway. The meeting that McAfee and Cahlen was present, 
and Art Hamm. 

Mr. Robinson. Was this after Siegel died? 

Mr. Sedway. Yes. 

Mr. Robinson. What did you have to do with whether there would 
be books or not ? You said that Connie Hurley had it. 

Mr. Sedway. Connie Hurley was present then. 

Mr. Robinson. And you were there? 

Mr. Sedway. Yes. 



ORGANIZED CRIME IN INTERSTATE COMJVIERCE 83 

Mr. Robinson. And Rosen? 

Mr. Sedway. Yes. 

Mr. Robinson. And you and Rosen really ran tlie racing wire, 
didn't you ? 

Mr. Sedway. No; I didn't. 

Mr. Robinson. Wasn't it understood that when anybody wanted 
wire service or a discussion of wire service that it was you and Rosen 
they had to deal with '. 

Mr. Sedway. Tliey had to deal with Connie Hurley alone. 

Mr. Robinson. Who brought Hurley to Las Vegas ? 

Mr. Sedway. Siegel did. 

Mr. Robinson. When did he bring him to Las Vegas ? 

Mr. Sedway. Maybe he came here himself. 

Mr. Robinson. What did he do here when he came here % 

Mr. Sedway. He got a book at the Boulder Club. 

Mr. Robinson. At the Boulder Club % 

Mr. Sedway. Yes. 

Mr. Robinson. Who gave him the wire service ? 

Mr. Sedway. When he first got it, I gave it to him. 

Mr. Robinson. You didn't mention that book, though. Is that a 
seventh book that there was ? 

Mr. Sedway. I think so ; yes. 

Mr. Robinson. Did he have any partners in the Boulder Club? 

!Mr. Sedway. I don't know. 

Mr. Robinson. Who persuaded you to give him a book at the Boul- 
der Club — Siegel? 

Mr. Sedway. Nobody. I think there was a book in there before, 
some time ago, and he made a deal with Goumond who he knew in 
Detroit. 

Mr. Robinson. And you agreed to give him the wire service ; is that 
right? 

Mr. Sedway. That is right. 

Mr. Robinson. Did you continue to be a friend of his ? 

Mr. Sedway. Whose? 

Mr. Robinson. Of Hurley's. 

Mr. Sedway. Sure. 

Mr. Robinson. You were a good friend ? 

Mr. Sedway. Yes. 

Mr. Robinson. And Siegel was a good friend of both of you ; is that 
right ? 

Mr. Sedway. That is right. 

Mr. Robinson. And Rosen, you were all friends? Rosen was a 
friend of yours, too ? 

Mr. Sedway. Rosen wasn't here then. 

Mr. Robinson. He came on and off to Las Vegas? 

Mr. Sedway. He came to the hotel. I didn't see him very much. 

Mr. Robinson. Did you ever have a falling out ? Did you ever be- 
come an enemy of Hurley's ? 

Mr. Sedway. No. 

]\Ir. Robinson. You continued to be friends ? 

Mr. Sedway. We are to this day. 

Mr. Robinson. When your contract for the wire service expired, 
Connie Hurley just took it over; is that right? 

Mr. Sedway. No : it was some time after. 



84 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. EoBiNsoN. How did that happen ? 

Mr. Sedwat. I think he took over — he took over Trans-America 
first. 

Mr. Robinson. He took over the Trans-America service? 

Mr. Sedway. That is right ; when Trans-America went out of busi- 
ness, then he got the contract. 

Mr. Robinson. He continued to be friendly with you ; is that right ? 

Mr. Sedway. Yes. 

Mr, Robinson. And to consult you and Rosen about wire-service 
problems ? 

Mr. Sedway. He didn't consult me about anything, sir. 

Mr. Robinson, Didn't the Stearns group approach you to settle 
their difficulty about the Avire service ? 

Mr. Sedway. He never approached me. I haven't talked to them, 
in years. I haven't talked to Dave, anyway. 

Mr. Robinson. Do you know a Judge Shure ? 

Mr. Sedway. Yes, I do, 

Mr, Robinson, Did he ever approach you? Did he approach you 
to straighten out the wire service? 

Mr, Sedway, A Judge Shure? 

Mr, Robinson, Yes, 

Mr. Sedway, I don't know what he had to do with it. 

Mr. Robinson, Didn't you send him to the Stearns group ? 

Mr, Sedway, No ; I didn't, 

Mr, Robinson. Did he ever go to the Stearns at your request? 

Mr. Sedway. He might have gone, but not at my request, I think 
he might have talked with me about it, but I told him that I had 
nothing to do with it, 

Mr, Robinson. Didn't you tell him that you would never give him 
the wire service? 

Mr. Sedway. He was just a lawyer around here ; a disbarred lawyer, 

Mr. Robinson. In any event, you never did give the Stearns group 
the wire service; is that right? 

Mr. Sedway. I didn't have it to give it to them. 

Mr. Robinson. And Hurley never gave it to them ? 

Mr. Sedway, No. 

Mr. Robinson. Hurley continued to be very close to you? 

Mr. Sedway, We were friends. 

Mr. Robinson. You testified a little earlier that you had a meeting 
at which the group representing the Golden Nugget was there, and 
Hurley was there, and you and Rosen were there, and the Golden 
Nugget wanted to be sure there would be no more books in town; 
is that right? 

Mr. Sedway. That is what they asked. 

Mr. Robinson, Wliy did they ask you that? 

Mr. Sedway. They didn't ask me that. They asked that of Hurley. 

Mr. Robinson. And he was there in connection with your negotia- 
tions with the Golden Nugget? In other words, all one group operat- 
ing together ; isn't that right ? 

Mr, Sedway. Oh, no. He had nothing to do with the Golden 
Nugget book. They asked him to give them the wire for the Golden 
Nuggett, and he told them he couldn't give it to them, that he had 



ORGANIZED CRIME IN INTERSTATE COMMERCE 85 

already given a wire to the Golden Nugget, that there are people 
in the Golden Nugget. 

Mr. KoBiNSON. In other words, he said if the wire didn't go to you 
and Kosen, nobody would get it ; is that right ? 

Mr. Sedway. He didn't say that, no. 

Mr. E.0BINS0N. Isn't that what it amounted to ; there were already 
people there getting it ? 

Mr. Sedway. Naturally, if he is giving it to people, he is not going 
to take it away from them and give it to somebody else. 

Mr. Robinson. It had to be you or nobody ? 

Mr. Sedway. He is doing business with us. 

Mr. Robinson. Isn't it a fact that he meant that it had to be you 
or nobody ? 

Mr. Sedway. No, it isn't a fact. I am sorry. 

Mr. Halley. Isn't that the plain meaning of what you are saying ? 

Mr. Sedway. No, it isn't the plain meaning. If you are doing busi- 
ness with somebody in a location, and somebody else comes along and 
wants that agency, and this man says, "Well, I already have somebody 
there ; why should I give it to you ? " the chances are that if we were 
out he would give it to them. If we were out of the Nugget, that is. 

Mr. Halley. They had the power to put you out, didn't they ? 

Mr. Sedway. They had the power to put us — yes, they could have 
dispossessed us any time at all. 

Mr. Halley. He said he wanted to continue to give it to the people 
that were already there ? 

Mr. Sedway. Mr. McAfee wouldn't put us out, because he gave his 
word. He was the one who stood up for us. 

Mr. Halley. How did Rosen get into that book at the Golden 
Nugget ? 

Mr. Sedway. He bought in. 

Mr. Hally. What did he pay ? 

Mr. Sedway. Here is what happened. After Siegel died, Rosen 
came to town and was trying to get some buyers for the Flamingo. 
I think he talked to several groups. Finally, I told him that I had 
talked to somebody and I thought I could get a couple of groups 
together, and I think we can buy it, if we could buy it reasonably, 
with a small down payment. So he says, "Well, you work it out, and 
when you get all set, go speak to the people." 

So I did. I talked to Sanford Adler and Charlie Resnick. They 
owned the El Rancho Hotel at the time. I talked to him and he was 
very much interested and he said they would be interested but they 
couldn't take it all. So I called Mr. Greenbaum. He went back to 
Phoenix since — called him and he brought some people in. Mr. Mc- 
Elroy was brought in, and I got a man, a local man in town here, 
Mr. Mack. He put some money in, and we formed this group and 
bought the Flamingo for $3,900,000, with a down payment of, I 
think, around $500,000 or $600,000 ; I don't remember. The records 
are there. 

Then when Rosen — we got closer, and Rosen says, "Well, as long 
as I am going — " and Rosen, incidentally, liked the new set-up and 
he bought in. He put in 10 and then he bought in 5 more. 

Mr. Halley. Ten what? 

Mr. Sedway. Ten percent. And then 5 percent more — 15 percent. 



86 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. What did he pay ? 

Mr. Sedway. He paid what we all paid, except that for the first 
10 he didn't have to put up any loan money. 

Mr. Halley, Why not? 

Mr. Sedway. Well, for the consideration that he was instrumental 
in making the — got all the proxies from all the other stockholders, and 
everything. So they agreed to sell it to him without a loan, the 10. 
But the five he loaned just like anybody else. Some people loaned 
more, some people loaned less. 

Mr. Halley. How much did he have to put up for the five ? 

Mr. Sedway. For the five ? Well, it was 10 percent capital and 90 
percent loan. 

Mr. Halley. How much would the loan be. then? 

Mr. Sedway. I don't know what it would amount to ; say, on $500,- 
000 or $(500,000, if he had 5 percent, it would be $30,000, 10 percent 
would be 

Mr. Halley. Three thousand dollai-s? 

Mr. Sedway. Three thousand dollars for capital and $27,000 loan. 

Mr. Halley. So he did not have to put up $54,000 loan money on 
his 10 percent? 

Mr. Sedway. No. 

Senator Tobey. After Mr. Siegel died, Mr. Rosen came down here,, 
didn't he? 

Mr. Sedway. Yes. 

Senator Tobey. And what had been Rosen's relations with Siegel 
before that? 

Mr. Sedway. Rosen had an interest in the old Flamingo, in the 
Nevada Projects Co., and when Siegel died he came down to sort of 
look after the business and see what could be done to salvage it. The 
place was in a very bad spot. It was ready to close if they didn't get 
a buyer. They weren't doing much business on account of all the 
adverse publicity that Siegel was getting during that time. 

Senator Tobey. Rosen and Siegel had been pretty close in other 
deals in the past? 

Mr. Sedway. I don't know, but they were very close. As a matter 
of fact, Rosen's son just recently married Siegel's daughter, so the 
families were close. 

Senator Wiley. Who owned the 90 percent ? Who had the interest 
in the other 90 percent ? 

Mr. Sedway. Various stockholders. I bought a piece there, I thinks 
at the time. I bought 5I/2 percent. 

Mr. Halley. Who were the other owners? 

Mr. Sedway. Mr. Greenbaum, Mr. Mack. 

Mr. Halley. This is Greenbaum, of Phoenix ? 

Mr. Sedway. Yes; and Stanford Adler. Pie bought forty-some- 
odd shares, 48 or 49 percent. 

Mr. Halley, Adler eventually sold out; is that right ? 

Mr. Sedway. Adler eventually sold out. 

Senator Wiley. How much do you own of it now ? 

Mr. Sedway. I own 7%o percent. 

Senator Tobey. Would you mind telling us what your net woith 
is now? What do you consider your net worth to be today? 

Mr. Sedway. I wouldn't know offhand. 

Senator Tobey. A million dollars or more? 



ORGANIZED CRIME IN INTERSTATE COMJV^ERCE 87' 

Mr. Sedway. Xo; I wouldn't know offhand. It is not a million 
dollars ; no, sir. 

Senator Wiley. What income have you been drawing out of the 
place ? 

Mr. Sedway. We draw no income at all. 

The Chairman. Wliat is your income per year? What was your 
income last year? 

Mr. Sedway. I invested in properties around here, and I have been 
very successful. I just sold a piece of property for $70,000, which I 
had a partner. I sold another piece of property for $6,500 which 
cost me $2,000. This piece that I sold for $70,000 originally cost 
me $14,000, and I still have three-quarters of it left, more than that,, 
maybe four-fifths of it left. 

This I bought a long time ago. I am talking about highway prop- 
erty on the Strip. The property adjoining the Flamingo I have with, 
two associates. I have 50 percent, and they have 50 percent. We 
just sold 700-foot frontage for $70,000. We still have the difference 
to a half-mile frontage. 

Mr. Halley. AVheii did you acquire that ? 

Mr. Sedway. Acquired i^ in 194-1:, and 1 bought it, I bought the whole 
thing for $14,000. 

Mr. Halley. You mean j^our 50 percent? 

Mr. Sedway. No ; 1 bought the whole thing and then sold 50 percent 
of it to these two fellows for $25,000 2 years ago, or a little more. 1 
sold it to them for $25,000, and since then it went up so that we sold 
just 700 feet for $70,000. 

The Chairman. What was your net income last year ? 
Senator Wiley. What did you return ? 
]\Ir. Sedway. I don't know offhand. 
The Chairman. Approximately how much? 
Mr. Sedway. About $30,000, $35,000. 

Senator Wiley. You don't get anything out of the Flamingo? 
Mr. Sedway. I get my room ; I get my board. 

Senator Tobey. This question isn't meant to be impertinent. We 
try to learn something in all these things. We are sitting down here 
and talking with other men who have been in tlie gambling business, 
and the point I make is a little deeper than that. You have been, 
in this business all your life, and they are all playing the same games 
and they are all peeling off from it. You are growing rich, so ta 
speak. The worst of it is that those of us who — I will speak it pretty 
clear : You don't contribute a thing in the way of production that makes 
real wealth. What you do is peel off in these games of chance. If you 
had your life to live over again, would you play the same kind of a 
game again? 

Mr. Sedway. No, sir. 

Senator Tobey. We have a country we love, all of us, and you and 
I are a part of it ; Ave are citizens. You simply wonder, after all,^ 
after the 60 or 70 j^ears we live here, what it all amounts to after it is 
all said and done. You are in cahoots with a lot of people like 
Bugsy Siegel, and you wonder whether it all pays or not or what it 
amounts to, and why men do these things. I look upon these people 
in my State of NeAv Hampshire that till the soil and make $2,000- 



S8 ORGANIZED CRIME IN INTERSTATE COMMERCE 

a year as a lot richer than these people down here. They have got 
peace of mind and can look everybody in the eye. 

Mr. Sedway. Senator, you see what it got for me, three coronaries 
and ulcers. 

Senator Tobey. What I am asking is this : Wliat does it all amount 
to ? Why do men play the game this way ? What makes it attrac- 
tive to them ? What is the matter with men ? 

Mr. Sedway. Just go into that type of business and you get into 
it and you stay in it. 

Senator Tobey. You say you knew Lucky Luciano ? He is a moral 
pervert and the scum of the earth, Lucky Luciano, and he is playing 
the game over there still in Italy. 

When decent men want to make a living, these men peel it off. 
They are rich ; they are poor. They may have money but that is all 
they have got. 

Mr. Sedway. We don't get as rich as you think we do. This is hard 
work. I work pretty hard in this business. 

Senator Tobey. But you got the rich end all the time. If you 
put the same talent you have got toward constructive things in life, 
producing something that makes real wealth and human happiness, 
men would arise and call you blessed. 

We find these men all over the country. What has come over the 
world? What are the dangers: Love of money and power. There 
are some finer things in the world. 

Mr. Sedway. You asked me if I would want to do it over again. 
I would not do it over again. I would not want my children to do 
it again. 

Senator Tobey. I feel very earnest about it. It is a cancer spot in 
the l)ody politic. 

Mr. Halley. What interests do you have today in any books in Las 
Vegas ? 

Mr. Sedway. None whatsoever. 
Mr. Halley. No books whatsoever? 

Mr. Sedway. No. I have given that up after that. I was offered 
books. I don't want to make any more money. I am looking to make 
a living. I don't know how long I am going to live. I have these 
heart attacks and the other difficulty, and I am 57 years old. I am 
older than you are, and figuring along and making a living for my 
family, and I am not makhig a lot of money. 

Mr. Halley. What are your present business interests? You have 
your 7% percent of the Flamingo ? 

Mr. Sedway. And I have some property that I buy and sell. If 
I have a chance to buy a piece of property, I buy it and sell it, and 
that is the only way I can accumulate that kind of money, is to buy 
property and sell it. 

Mr. Halley. Aside from the Flamingo, do you have any interest 
in any other gambling operation? 
Mr. Sedway. No, sir. 

Mr. Halley. Do you know whether Meyer Lansky has any holding 
in Las Vegas ? 

Mr. Sedway. Whether he has any holding now ? 

Mr. Halley. Yes. 

Mr. Sedway. No ; I don't. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 



89 



Mr. Halley. Did he ever have ? 

Mr. Sedway. Yes ; he did. 

Mr. Halley. What was that ? 

Mr. Sedway. He was interested in the El Cortez Hotel. 

Mr. Halley. When was that ? 

Mr. Sedway. 1945, 1 think. 

Mr. Halley. How long did he have an interest ? 

Mr. Sedway. As long as we had it. 

Mr. Halley. Who had it ? 

Mr. Sedway. Siegel was interested in it. 

Mr. Halley. Siegel and Lansk}^ ? 

Mr. Sedway. Lansky 

Senator Tobey. Where is that hotel ? 

Mr. Sedway. It is here in Las Vegas. It is a commercial hotel. 

Mr. Halley. Was Marion Hicks there? 

Mr. Sedway. We bought it from Hicks. 

Mr. Halley. Who else had an interest ? 

Mr. Sedway. Greenbanm, several others. 

Mr. Halley. In 1945 this was? 

Mr. Sedway. Nobody had a very big interest in any one of those 
places. 

Mr. Halley. Siegel, Lansky, Greenbanm, yourself — who else? 

Mr. Sedway. All the men — Berman, several others. I don't re- 
member who. You refresh my memory, and I will tell you "Yes" or 
"No." 

Mr. 

Mr, 

Mr 

Mr 

Mr, 

Mr 

Mr 

Mr 

Mr 

Mr 



There was a big group. 



Halley. 

Sedway. 



When did you sell out? 
We sold out in 1945 or 1946. 
Halley. Did you have a casino in the El Cortez ? 
Sedway. A small casino. 
Halley. Did you have a horse book ? 
Sedway. No. 

Halley. Does Lansky still own any interest in the El Cortez ? 
Sedway. No ; I don't think so. 
Halley. How about Jack Lansky ? 

Sedway. No. He also was an associate with us, and then he 
bought it from us. 
Mr. Halley. He bought you all out ? 
Mr. Sedway. Yes ; with another man. 
Mr. Halley. Wliat is his name ? 
Mr. Sedway. J, K. Houssels. 

Mr. Halley. Do the Lanskys have any interest in the Thunderbird? 
Mr. Sedway. I don't know. 

Mr. Halley. They stay there a great deal ; don't they ? 
Mr. Sedway. Not Meyer ; Jake has been there. 
Mr. Halley. How long was Jake there, to your knowledge ? 
Mr. Sedway. I think he was there up to a couple of weeks ago, when 
I saw him before I went to the hospital. I have been in the hos]ntal 
now for 11 days. Two weeks yesterday is when I went into the hos- 
pital, and I think he was there before that. I don't know when he 
went in. 

Mr. Halley. Does Sadlow have an interest in the Thunderbird? 

Mr. Sedway. I don't know. 

Mr. Halley. Do you know Sadlow ? 

Mr. Sedway. Yes ; I do. 

68958— 51— pt. 10 7 



90 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Does lie have any otlier interests in this city ? 

Mr. Sedway. I don't know. 

Mr. Halley. Do you know whether Adonis has any interest? 

Mr. Sedway. I don't know. 

Mr. Halley. Did he ever ? 

Mr. Sedway. I don't know offliand. 

Mr. Halley. Do you think he might have ? 

Mr. Sedway. I don't know. 

Mr. Halli':y. Have you ever seen Adonis in Las Vegas ? 

Mr. Sedway. Yes. 

Mr. Halley. What is the most recent occasion ? 

Mr. Sedway. Five years ago. 

Mr. Halley. Did you ever negotiate with him to take an interest 
in the Flamingo? 

Mr. Sedway. No, sir; the Flamingo wasn't built then. 

Mr. Halley. Does Costello have any interest in Las Vegas ? 

Mr. Sedway. Not that I know of. I am sure not, but I can't say 
"No," but I am pretty sure not. He has never been here. 

Mr. Koi5iNSON. Do you know of any interest that Aaron Smehoff, 
alias Allen Smiley, has? 

Mr, Sedway. I don't know. 

Mr. Robinson. Did he ever have ? 

Mr. Sedway. I don't think so. 

Mr. EoBiNSON. Wasn't he in the original Nevada Projects Corp.? 

Mr. Sedway. He may have been; 1 don't know. I wasn't in it. 

Mr. RowNsoN. Did you have any conference here Avith Jack Dragna 
in tlie last year or 2 years? 

Mr. Sedway. Did I have a what? 

Mr. Robinson. A conference with Jack Di-agna here in Las Vegas. 

Mr. Sedway. I talked to him when he was here. 

Mr. Robinson. He flew here to see you; didn't he? 

Mr. Sedway. I don't know if he flew to see me for an}' particular 
reason. 

Mr. Robinson. He flew here ; didn't he ? 

Mr. Sedway. I don't know whether he fiew here or how he came 
here. 

Mr. Robinson. Where did he see you? 

Mr. Sedway. At the Flamingo. I think he stayed there. 

Mr. Robinson. How long did he stay at the Flamingo? 

Mr. Sedway. I don't know exactly. 

Mr. Robinson. Wliat was the subject of your discussion '. 

Mr. Sedway. Notliing of importance. 

Mr. RiBiNSON. Well, did he talk any business at all witli you? 

Mr. Sedway. No, sii-. 

Mr. Robinson, Did he talk about a possible investment in the Des- 
ert Inn? 

Mr. Sedway. No. 

Mr. Robinson. And he didn't talk al)out any ))usiness with you?. 

Mr. Sedway. No, sir. 

Mr. Ror.iNSoN. Did he talk al)out the wire service? 

Mr. Sedway, No, sir. 

M','. Robinson, You had no discussions whatsoever about the wire 
service ? 

Mr, Sedway, No, sii-. 



ORGANIZED CRIME IN INTERSTATE COMMOERCE 91 

Mr. RoBixsoN. Do you know Hymie Levin, of Chicago? 

Mr, Sedway. Do yon mean the crippled fellow ? 

Mr. KoBiNsox. The one wlio had the wire service in Chicago. 

Mr. Sedway. Isn't that the fellow who is so awfully sick? 

Mr. Robinson. Yes. 

Mr. Sedway. I met him when he was in bed. 

Mr. RoBixsox. Did you ever discuss the wire service with him? 

Mr. Sedway. No. I liad nothing to do with any wire service out- 
side of Las Vegas, as I recall. 

The Chairman. Mr. Sedway, why was Siegel killed, and who killed 
him ? 

Mr. Sedway. 1 don't know, sir. 

The Chairjvian. He w^as killed in connection with the wire service. 
Exactly what was the controversy there? 

Mr. Sedw^a.y. I don't know. I wouldn't know if he was killed in 
connection with the wire service or any other reasons. 

The Chairman. Where was he shot? 

Mr. Sedavay. He was killed in Beverly Hills, in the home of Vir- 
ginia Hill. 

The Chairman, You don't think it had anything to do with the 
wire service ; do you ? 

Mr. Sedway. I don't know. I wouldn't know whether it had any- 
thing to do with anything. I saw Siegel the night before. As a 
matter of fact, I very seldom came up to the Flamingo, because I was 
tlie chairman of the UJA for several years, and it was time to put on 
another drive, and I wanted to put a drive on at the Flamingo, which 
eventually I did, after he died. 

Senator Wiley. Chairman of what? 

Mr. Sedw^\y. Of United Jewish Appeal of the State of Nevada. I 
have been chairman for some time. This last year I was so sick I 
didn't want to take it on, but I eventually took it on anyway. 

Senator Tobey. You say you saw him the night before he died? 

Mr. Sedway. Yes. 

Senator Tobey. He left for Los Angeles the next day; did he? 

Mr. Sedway. Yes, sir. I had the regional agent for the UJA with 
us. I forget his name. I can get it. And we discussed it, and Siegel 
said that he thinks he can get Al Jolson down for the dinner, which 
Avould be a big thing for us. 

Mr. Haeley. Sticking to this murder, did he say anything that 
might indicate that he was in fear of his life ? 

Mr. Sedway. He never said anything. 

Mr, Halley. Have you any idea of why he might have been mur- 
dered ? 

Senator Wiley. Where was this conversation with you? 

Mr. Sedway. In the dining room. 

Senator Wiley. Up here? 

Mr. Sedw^ay. Yes, 

Senator Wiley. Then he went back? 

Mr. Sedway. Tlien he went back later that evening. I had left 
Avith this gentleman that came in from Washington to see me about 
the drive, and he went back, and he was supposed to call me the next 
day in reference to Jolson. He neA'^er did call me, and the next thing, 
late that night, is when it happened. 



92 ORGANIZED CRIME IN INTERSTATE COIVIMERCE 

The Chairman. At the Flamingo did you have a commission man 
to lay off bets somewhere ? 

Mr. Sedway. We have one there now. 

The Chairman. You have one. Whom do you have, Mr. Phillips? 
Mr. Sedway. No, sir ; Mr. Gobaum. 
The Chairman. What is his first name? 
Mr. Sedman. Hy Gobaum. 
The Chairman. Where does he lay off bets? 
Mr. Sedway. They lay off bets. They bet all over the country. 
The Chairivian. There are several telephones, and they just call 
Carroll, Erickson, or somebody in San Francisco and Los Angeles? 
Mr. Sedway. They are strictly a betting office. They don't book. 
They are strictly a betting office. They are betting. 
Mr. Halley. You mean Gobaum. 

The Chairman. How many commission men are there in Las Vegas ? 
Mr. Sedway. I think there is one in the Desert Inn and one in the 
El Kancho. There is one in the Last Frontier. 

Mr. Halley. Is the one in the Last Frontier, Mr. Phillips? 
Mr. Sedway. I don't know. 

Mr. Kuymann. What is your financial arrangement with him ? 
Mr. Sedway. They pay rent. That is all they do, Bill. 
Mr, Ruymann. What rent do they pay ? 
Mr. Sedway. I think they pay $1,000 a month. 
Mr. Ruymann. Don't you get any of the take ? 
Mr. Sedway. No. A lot of people come downtown to see him and 
we get business through them for the hotel. 

Mr. Halley. How do they operate? If you get somebody who 
wants to put a bet in your book and the bet is too high, do you put it 
over with them ? 

Mr. Sedway. That has nothing to do with our book. 

Mr. Halley. Just how do they operate ? 

The Chairman. Whose book does it have something to do with? 

Mr. Sedway. They have people call them and they sell their 

Mr. Ruymann. They call them from where ? 
Mr. Sedway. From all over the country. 
Mr. Ruymann. They call the bets in here ? 

Mr. Sedway. They call the bets in and they call them and they get 
214 percent and sometimes 5. 

Mr. Halley. Do they have to replace these bets in different places? 
Mr. Sedway. Yes; and whoever takes the bets for them pays him 
for it. 

Mr. Halley. Wliere do they place the bets ? 
Mr. Sedway. In various parts of the country. 

Mr. Halley. Do you mean they will get bets from people all over 
the country ? 

Mr. Sedway. They will get it from one bookmaker and sell it to 
another one. 

]\Ir. Halley. They operate as a sort of exchange, don't they? 
Mr. Sedway. It is a commission office, strictly. They make their 
money strictly off of the 2i^ -percent commission. 

Mr. Halley. In other words, if a bookmaker in Miami Beach has 
a bet he doesn't want to handle, he will call them and they may find 
a bookmaker in Chicago or Los Angeles ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 93 

Mr. SedWx\y. If they don't find a bookmaker, they will pass them. 

Mr. Halley. Does the Flamingo book ever try to give them any 
book? 

Mr. Sedwat. The Flamingo book is a very small book. 

Mr. Halley. Suppose somebody came in and put down a very big 
bet that they wouldn't want to handle ? 

Mr. Sedway. We would just pass it. 

Mr. Halley. Why wouldn't you refer it to Gobaum ? 

Mr. Sedway. Gobaum is a betting office, not a 

The CHAiRMAiSr. You can lay it with somebody else ? 

Mr. Sedway. They would probably give it to Gobaum himself, if 
there was enough time. 

Mr. Halley. He has got to have very fast phone service ? 

Mr. Sedway. That is right. 

Mr. Halley. How does he get that ? 

Mr. Sedway. He has several phones, 

Mr. Halley. Wlio arranges for these long-distance calls to go 
through so quickly ? 

Mr. Sedway. I don't know that they go through quicker than any 
other calls. 

Mr. Halley. He has got to get them through in a matter of seconds. 

ISIr. Sedway. It only takes a minute to get any place. 

Mr. Halley. They have direct long-distance wire ? 

Mr. Sedway. They don't have to go through the local office. 

Mr. Halley. Do they have a special operator handling their calls? 

Mr. Sedway. I don't know whether they do or not. They are called 
LD phones. They are not local phones. You pick up a phone and 
you immediately have long distance. 

The Chairman. If you want Chicago number such-and-such, can 
you get it like that ? 

IVIr. Sedway. That is right. 

Mr. Halley. "^Vliat does the Flamingo pay for its wire service per 
week ? 

ISIr. Sedway. I don't know exactly. I 

Mr. Halley. To your best recollection. 

Mr. Sedway. I would say around $200. That is not my department. 
All I do is take care of the dining room and the shows. I book all the 
shows, put on all the shows and book all the shows. That is all I have 
got dealings with now, is with actors. I have nothing to do with the 
gambling end or the booking end of it. As a matter of fact, I don't 
go into the office of Gobaum. I stay in bed 15 or 16 hours a day. 

The Chairmax. Is that $1,000 a month he pays? 

Mr. Sedway. Around that. It might be $750. Don't hold me to 
those figures. 

Mr. Halley. And you think the hotel pays $200 a week for the wire 
service ? 

Mr. Sedway. I think so ; yes. 

]\Ir. Robinson. When you were in Los Angeles, were you acquainted 
with Big Greenie Greenberg? 

Mr. Sedway. No ; I never knew him. 

Mr. Robinson. Did you hear of Big Greenie Greenberg in Los 
Angeles ? 

Mr. Sedway. I heard of him after he was killed. 



94 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. KoBiNSoN. Was Mr. Siegel indicted for that murder? 

Mr. Sedway. Yes, sir. 

Mr. Robinson. Did he ever discuss it with you ? 

Mr. Sedway. No, sir. * 

Mr. Robinson. Was he ever brought to trial on it? 

Mr. Sedway. Yes, sir. 

Mr. Robinson. He was brought to trial ? 

Mr. Sedway. Yes, sir. 

Mr. Robinson. In Los Angeles? 

Mr. Sedway. Yes, sir. ', 

Mr. Robinson. Or Brooklyn? 

Mr. Sedway. What? 

Mr. Robinson. In Los Angeles or Brooklyn ? 

Mr. Sedway. In Los Angeles, wasn't it? 

Mr. Robinson. Because of the death of Abe Reles he was not con- 
victed — the principal witness in the case. 

Mr. Sedway. I think the case was after the defense rested. I think 
they asked for a directed verdict and it was given. 

Mr. Robinson. In the meantime the principal witness, Mr. Abe 
Reles, fell out of a hotel in Coney Island, is that correct ? 

Mr. Sedw^ay. I read that in the paper. 

Senator Tobey. Did he fall, or was he pushed ? 

Mr. Sedway. Police were with him in the room, so he must have 
fallen. 

Senator Tobey. What about this man McAfee? Do you know him 
pretty well? 

Mr. Sedway. Yes. 

Senator Tobey. Wliat kind of a fellow is he ? 

Mr. Sedway. A very nice fellow. 

The Chairman. What did the Flamingo make last year? 

Mr. Sedway. Offhand I wouldn't know. 

The Chairman. Well, about, your best judgment. 

Mr. Sedway. I would say, net after taxes, around $400,000 — between 
$300,000 and $400,000. As we make it we throw it back in. 

The Chairman. We appreciate the testimony you have given us 
here. 

(Witness excused.) 

TESTIMONY OF ROBERT J. KALTENBORN, LAS VEGAS, NEV. 

The Chairman. Mr. Kaltenborn, 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. Kaltenborn. I do. 

Mr. Halley. What is your full name? 

JVfr. Kaltenborn. Robert J. Kaltenborn. 

]\f r. Halley. What is your address ? 

Mr. Kaltenborn. Rancho Road, Las Vegas. 

Mr. Halley. Wliat is your business? 

Mr. Kaltenborn. It is varied, sir. I am the owner of the largest 
wholesale automobile parts store in Las Vegas, and varied real-estate 
ownerships. At the present time I am building a subdivision housing 
project. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 95 

Mr. Halley. Were you ever convicted for a violation of the internal- 
revenue laws? 

Mr. Kaltenborx. I pled nolo contendere in March of last year. 

Mr. Halley. Were you sentenced ? 

Mr. Kaltenborn. To 6 months in a Federal prison, Tucson, Ariz. 

Mr. Halley. Did you serve ? 

Mr. Kaltenborn, Four months and eight days. 

]\Ir. Halley. In connection with what business did you find your- 
self indicted? 

Mr. Kaltenborn. Well, they arrived at the deficiency from a net 
worth standpoint, and of course the earnings were from varied inter- 
ests, but at that time it would have been from — my income would have 
been from my earnings of the wholesale parts business, which I have 
had since 1932, from varied real-estate transactions, and a half owner- 
ship in a very small gambling club which I formulated in September 
of 10-1:2 and sold out in April of 1944. Of course the period of the 
charges was for the years 1942 and 1943. 

Mr. Halley. Did you have any business partners during those 
years ? 

Mr. Kaltenborn. Yes, sir. 

Mr. Halley. Who were they ? 

Mr. Kaltenborn. I had varied partners. I don't know how far you 
want me to go to break it down. 

Mr. Halley. In your principal business. 

Mr. Kaltenborn. In the automobile parts business? 

The Chairman. Anyway, the three who owed a tax like you owed. 

Mr. Kaltenborn. There was only one other, sir, Mack. 

Mr. Halley. Was he indicted, too ? 

Mr. Kaltenborn. No, sir. 

Mr. Halley. Now, at some time were you asked to purchase stock 
in a copper mine? 

Mr. Kaltenborn. Yes, sir. 

Mr. Halley. Would you tell the committee about that? 

Mr. Kaltenborn. Well, it was in the early summer of 1945, after 
which I had known that I was being investigated, that a man by the 
name of Hartman came to my place of business and started the con- 
versation by saying to me that "Senator Scrugham and I registered at 
the Salsagel Hotel last night and that at breakfast this morning the 
Senator insisted that I contact you," that he wanted me in this com- 
pany, "that he was a very close associate of a friend of yours" — and 
the Senator was, I knew him very well. And immediately it flashed 
through my mind that the man was not telling me the truth because 
I know that Senator Scrugham never stopped any place in Las Vegas 
except at the National Hotel. 

I thought that possibl}^ the man was telling me the truth, but I had 
doubted it, and I excused myself for a moment and went to a phone 
away from him in my store, and I called the Salsagel Hotel, and he was 
not thei-e and didn't register there, and then I called the National and 
the Senator was in town but he wasn't at the Salsagel Hotel, so I went 
back, didn't tell the fellow, of course, what I found out, but confirmed 
my opinion that this man was a damned liar. 

So I said to him, "Mr. Hartman, you have got me in a very busy 
time. I would like to buy your lunch at noon and go into the matter 



96 ORGANIZED CRIME IN INTERSTATE COMMERCE 

of this investment more thoroughly because of Jim Scrugliam asking 
you to come to see me. I would like to go into it more thoroughly." 

So he said, "Well, I would like to tell you a few of the people that are 
interested in the company and who the officers are," and so forth and 
so on. I tried to get away from him without taking much more time, 
but he insisted upon telling me a few of the details, and as he got 
further along I thought that — he broached the subject of me not hav- 
ing met the right people in Nevada. "You have done an excellent 
job for yourself and for the community, but you haven't met the right 
people. You wouldn't be in this problem if you had met the right 
people." So again he mentioned the fact that he had Clark — he is 
now gone — who was a very influential man and a very dear friend of 
mine, that he had $10,000 worth of stock. 

Senator Tobey. What was the name of the company ? 

Mr. Kaltenborn. Mountain City Consolidated Copper Co. I know 
it is the company in question. I am sure it is Mountain City Con- 
solidated Copper Co. 

Mr. Halley. Did he mention the name to you? 

Mr. Kaltenborn". Yes, sir. 

Mr. Halley. Did he mention Patrick Mooney ? 

Mr. Kaltenborn. Yes, sir. 

Mr. Halley. Who did he say Mooney was? 

Mr. Kaltenborn. He said Mooney was head of the State income- 
tax department. 

Mr. Halley. You mean the Federal ? 

Mr. Kaltenborn. That is right. I mean in our State he was the 
head, in our State. 

Mr. Halley. Did he say that Mooney had an interest in this com- 
pany ? 

Mr. Kaltenborn. He told me he was the secretary-treasurer, and he 
told me to send my money there. 

Mr. Halley. Did he say directly that if you bought the stock you 
would not be indicted ? 

Mr. Kaltenborn. That is right. He told me that Mr. Mooney 
would show me how to charge it off so that I could take a short-term 
loss. 

Mr. Halley. Did he indicate that you were sure to have a loss? 

Mr. Kaltenborn. Well, he told me that I was just buying the stock 
for the purpose of evading income-tax prosecution. 

Mr. Halley. In other words, j^'ou weren't to expect any possibility 
of making any money ? 

Senator Tobey. What is this fellow's name again ? 

Mr. Kaltenborn. May I, as long as you ask me — I want this un- 
derstood. I went to see Ed Clark, who is a very important man. At 
one time he was very, very well known in town, very important man. 
I always went to him for counsel. So he asked me to take this man 
to dinner and to get all the information I could get out of him, which 
I did. 

Mr. Hartman asked me, after we got through with dinner, if I 
wanted to introduce him to four other people in town, one of which I 
know was — one of which was my partner named Mack. So when I 
got through with my lunch I went back, or I told Mr. Hartman, rather, 
that I would have to try and raise the money, that I — I had no inten- 
tions of buying it — but that I didn't feel I could go $3,500, but would 



ORGANIZED CRIME IN INTERSTATE COMMERCE 97 

$2,500 suffice ? He said absolutely not. He said, "You are on the list 
for $3,500." 

So I reported back to Mr, Clark, who supposedly owned $10,000 
worth of the stock, and Mr. Clark told me he didn't intend for me 
to buy any of the stock. 

In 3 or 4 days I got a telephone call from Mr. IMooney, who I pre- 
sumed to be Mr. Mooney. I never met the man. The telephone call 
came to my store, and he says, "I understand you are making some 
derogatory remarks in regards to my connections with the Mountain 
City Consolidated Copper Co., and I would like to know what you 
said." I said, "What am I supposed to have said ?" 

"That if you buy this stock you won't have any income-tax problems, 
that you will have met the right people," and so forth and so on. 

And I said, "Well, let me tell you this, Mr. Mooney. Undoubtedly 
you have a telephone in your oflice, a dual telephone line. Will you 
put Mr. Hartman on the phone, and I want you to listen in." I said, 
"Now, Mr, Hartman, I want Mr. Mooney to hear this. I want to say 
this to you, that you have undoubtedly told — undoubtedly Clark has 
told Mr. Mooney, or somebody in turn who has told him what took 
place, and you have denied it, naturally. And I want to tell you two 
things that have happened to cause me to think that you are a damned 
liar, and then I am going to let Mr. Mooney use his own judgment. 
You first stated that you stayed at the Salsagel Hotel with Jim Scrug- 
ham, and I knew that was not true because he never stays there. I have 
entertained many friends of Jim Scrugham's in town." 

That was the No. 1 lie. He started trying to alibi that, that he 
didn't mean to say that; he meant to say that he had breakfast at the 
Salsagel with Jim Scrugham, said that isn't what he said. 

I said, "You told me he had— Clark had— $10,000 worth of that 
stock," and I said, "Clark told me that is not true, and asked me to take 
you to dinner and bleed you for all the information I could get, and I 
presume he has passed it to Bob Douglass, who is Mr, Mooney's su- 
perior officer." I said, "You lied to me twice and that is all there is 
to it. Mr. Mooney can do whatever he pleases," and that is exactly 
what took place. 

The Chairman. What did Mr, Mooney say on the telephone? 

Mr, Kaltenborn. He, of course, wanted me to tell him whether 
this man offered to give me immunity for my problems, and I assured 
him that that man wanted to say that, and he wanted to defend the 
man, to tell me that I wasn't telling the truth. And that is when I 
asked the fellow to get on the phone, to let him listen, to tell him two 
of the lies he told me, and let Mr. Mooney use his own judgment of 
what took place. That was in '45. 

Mr. Halley. Did your associate, Mack, buy any stock? 

Mr. Kaltenborn. I do not know. 

Mr. Halley. Did you ever discuss it with him ? 

Mr. Kaltenborn. Yes ; I discussed it with him. 

Mr. Halley. Did he tell you whether or not he had bought stock? 

Mr. Kaltenborn. No; he did not tell me, but he was in the same 
business and he was not indicted. As a matter of fact, he was allowed 
to make an amended return, and I wasn't. 

Senator Wiley. How much was involved ? 

Mr. Kaltenborn. That is one thing. 



98 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Wiley. What did they claim ? 

Mr. E^LTENBORN. They claimed $77,000 tax that I owed. I just 
received my bill the other day with my $4,200 forgiveness of 1942, if 
you understand that you lose your forgiveness if fraud takes place. 
My total bill was less than $19,000. That includes 50-percent fraud 
penalty and the 42-percent tax, and I must say one thing to you, that 
this is the truth. My brother — I don't want to go into too great 
(jetail — gave me $6,000 that he won in gambling games in camp before 
he was shipped overseas, and he was having trouble with his wife, 
and I invested the money for him. He paid income tax on the $6,000, 
and they refused to take my story and said that they had never heard 
of such a thing. And also that had it not come up in my net-worth 
basis, with the $4,200 I lost in my 1942 forgiveness, I wouldn't have 

The Chairman. What is Mr. Hartman's first name ? 

Mr. Kaltenborn. I refreshed my memory since all this came up, 
and he is registered at the hotel under two different initials, but I only 
remember him as Mr. Hartman, and at the Salsagel Hotel he regis- 
tered as E. H., and once as L. H., and I am sure it is the same man 
because it is the same time. But, of course, from all I understand, 
he has been using many aliases. I think you have him down as Martin 
or something. 

Senator Wiley. You said the original assessment was $77,000 ? 

Mr. Kaltenborn. Yes. 

Senator Wiley. What office assessed that ? 

Mr. IL\LTENBORN. The San Francisco Fraud Division of Internal 
Revenue. We went into these — after I plead nolo contendere — and 
that is a long story. I don't think they could have ever convicted 
me. I am sincere about it. When I went to San Francisco about 
4 months ago with my tax counsel, in San Francisco, very decently, 
and so forth, in a very friendly way, my total bill, with the 42 percent 
interest and the 50-percent fraud penalty and the forgiveness that I 
lost, why, it would come to less than $20,000. 

Senator Wiley. What I am getting at is, they double up on you. 
That would be 36, wouldn't it, from 72? 

Mr. Kaltenborn. No, sir. The bill that they claim — in other 
words, the amount of money that they claim that I had in excess of 
what I covered by the taxes I paid would have required me to have 
paid another $77,000 tax. Had they found that I defrauded them of 
an amount of money, that would have required the payment of $77,000 
tax. Let's call it $70,000. 

Senator Wiley. For what year? 

Mr. Kaltenborn. Two years. Then if they found that I had de- 
frauded them out of an amount of money, that would have required 
an additional payment of $70,000 taxes. The first thing that would 
be done would be a 50-percent penalty; that would have made it 
$35,000 more. Then 6 percent interest on both the amount of the 
taxes and the penalty, whicli in 7 years, would have been 42 percent, 
so the $77,000 would have become a little more than — but I would 
have owed them $150,000. 

Senator Wiley. Was the settlement compromised? 

Mr. Kaltenborn. Wlien my tax people sat down with the conferee 
in San Francisco and fought out how much money my various prop- 
erties were worth, and allowed for living expenses, and so forth, the 



ORGANIZED CRIME IN INTERSTATE COMMERCE 99 

amount of money that I apparently defrauded them out of would have 
been about $10,000 instead of $77,000. 

Senator Wiley, Then someone, either intentionally or through neg- 
ligence, figured that seventy-thousand-odd dollars? 

Mr. Kaltenbokn. There is only one thing that I want to say to you. 
I was so pleased to have the matter over with, because it is a thing 
since 194r) that has been like a sword over my head. Everybody in 
the city of Las Vegas knew all about my troubles and my problems. 
Seeiningl}', some way or anothei-, there must be method in their mad- 
ness of letting everyone in the w^orlcl know that I was being investi- 
gated. I don't know w^hy. I was pretty prominent in this town, I 
must say : Past president of the chamber of commerce, past president 
of the Kiwanis, chairman of the Red Cross, chairman — I started city 
management of the government of Las Vegas. I have been mayor 
pro tempore. But instead of even coming to me and giving me any 
chance Mhatsoever to settle my problems with them, like they did Mr. 
Mack, my partner — they let him settle his problem — they slapped the 
hooks to me by telling everybody in the city that I was under investi- 
gation. I had two gentlemen — and I would like to have you put the 
names down, Donavon and Shemke, two income-tax experts in Los 
Angeles. Mr. Donavon was 27 years with the Internal Revenue De- 
partinent, and he came down here — I am going to have to refer to it 
this way — 2 days after Molly Malone was elected — put it that way, 
because I remember it so distinctly — and offered to settle my problems 
for a $15,000 fee. 

I ask you, how does Donavon, Shemke, find out that I was in tax 
problems? 

The Chairmax. Are they attorneys? 

Mr. Kaltenbokn. They are tax consultants. I think it is 
S-h-e-m-k-e. They are very prominent people in tax matters. Mr. 
Donavon was 27 yeare with the Internal Revenue. 

The Chairman. The}^ came and saw you ? 

Mr. Kaltenborn. They came to me in the presence of witnesses. 
''We cannot guarantee you," they said, "we can get you out of the jam. 
We know the jam you are in. We known that you are going to be 
indicted for $50,000." 

Mind you, I hadn't been indicted yet. 

''And for a fee of $15,000 and 25 percent of what we save for you, 
we will take j^our case — and we want you to know we have never lost 
a case." 

Senator Tobey. Where are they located ? 

Mr. Kaltenborn. Los Angeles. And they came here to Las Vegas. 

Senator Tobey. The same kind of racket is going on in Washington. 
More about that later. It is the same kind of a racket. 

Mr. K.\LTENBORN. In all due sincerity, and I have great confidence 
in Mr. Ruymann — I have dealt with him. I ask in the strictest con- 
fidence, what is a fellow like myself going to do ? I have a good moral 
obligation. I got out of the gambling business because I don't like it. 
What is a felloAv going to do like myself who has seven more years to 
settle with those people? I don't think — and I say it from the bottom 
of my heart — I think Pat Mooney was the brains of the deal, but his 
life is spent. 

The Chairman. What does he do now ? 

Mr. Kaltenborn. He is retired now. 



100 ORGANIZED CRIME IN INTERSTATE CORIMERCE 

The Chairman. Is this fellow Hartmann in the service? 

Mr. Kaltenborn- He was just a stock salesman. 

Mr. KuTMANN. Bob, did Blom have anything to do with that? 

Mr. Kaltenborn. Blom was the investigator who investigated me 
and who was later dismissed from the service becavise of an unsavory 
character, reputation, writing bad checks and getting drunk in Las 
Vegas. 

Mr. RuYMANN. Do you know whether Rex Blom had anything to 
do with this copper company? 

Mr. Kaltenborn. I want to correct that. I would not know if 
he did have. 

Mr. RuYMANN. In the course of his investigation did he ever men- 
tion it? 

Mr. Kaltenborn. No, sir. He was a pretty smart boy. At one 
time, from all the information I was able to get, he was the top man 
in the department. He went completely haywire. 

Senator Tobey. Is that the Union Pacific representative? 

Mr. RuYMANN. This is off the record. Senator, but to say that that 
man is anywhere near the best man in the service is an insult to the 
Treasury Department. 

Mr. Kaltenborn. I was only told that. I Avant you to know that. 
I was asked by the Department to plead nolo contendere, and I was 
threatened — I am talking too damned much. I can't help it. I was 
told not to do it. 

Mr. RuYMANN. Who asked you to plead nolo contendere? 

Mr. Kaltenborn- The Internal Revenue Department. 

Mr. RuYMANN. Who ? 

Mr. Kaltenborn. Do I have to answer that ? 

Mr. RuYMANN. Yes. 

Senator Tobey. We would like to have you. 

Mr. Kaltenborn. The man that took Mr. Blohm's place. 

Mr. Halley. What is his name ? 

Mr. Kaltenborn- Howard Werner. 

Mr. Halley. Who told you not to talk about it ? 

Mr. Kaltenborn. My attorney. They told me to answer your 
questions. But this sears my heart, that something has to be done 
about these things. 

The Chairman. We agree with you on that. Howard Werner — 
what is he now ? 

Mr. Kaltenborn. He is the head of the Frauds Division of the In- 
ternal Revenue in this area. 

Senator Tobey. Where is he located ? 

Mr. Kaltenborn. Las Vegas. 

Mr- RuYMANN. You are saying that he told you to plead nolo con- 
tendere ? 

Mr. Kaltenborn. He asked me to plead nolo contendere. 

Mr. RuYMANN. Who was present at the time he asked you ? 

Mr. Kaltenborn. Nobody. He told me that if I didn't, and fought 
them, that they would have to arrest my wife. 

Mr. RuYisiANN. Where were you at the time he told you that ? 

Mr. Kaltenborn. I don't know whether I was in his office. I be- 
lieve I was in his office here in this building. He told me they would 
have to throw a jeopardy assessment against me, for $100,000. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 101 

In 1942 I had a partner in tlie second wholesale automobile-parts 
business that I had forgotten about, and that business got involved 
very seriously in '46 financially, and I was in damned bad financial 
shape for cash money. I had to put out $78,000, and so when — when 
they threatened me that if I fought them they would throw a jeopardy 
assessment on my business, it would have meant the wrecking of my 
business ; and that if I pled nolo contendere they wouldn't arrest my 
wife, they would waive the fraud, which they did against my wife, and 
they would do everything they could to get me an easy sentence 

Mr. KuYMANN. How long before the trial did he supposedly tell 
you this ? 

Mr. KALTENBORisr. I would say 2 or 3 months. 

Mr. RuTMANN. He told you 2 or 3 months before the trial to plead 
nolo contendere? 

Mr. Kaltenborn. Yes. 

Senator Wiley. Any more fellows in this community that you 
know have been bled ? 

]\lr. Kaltenborn. Only gossip and what this man Hartmann told 
me. 

The Ciiair3ian. Where is Mr. Hartmann now ? 

Mr. Kaltenborn. Sir, I don't know. 

Mr. Robinson. I have him subpenaed in San Francisco. 

Mr. Kaltenborn. He is an ex-convict. I will say this, that the 
SEC has been after me for 4 or 5 years to testify, and I have refused 
to do it, because I was afraid of the consequences. 

Mr. RuTMANN. You made that statement, that you were the only 
man that served time for income tax in Clark County ? 

Mr. Kaltenborn. No; I didn't say that. I thmk it is probably 
true. No ; I wasn't, either. 

Mr. RuYMANN. Dr. Davis served 2 years. 

Mr. Kaltenborn. I only wanted to let you know this, that I have 
Conway & Moe, very high grade tax accountants, who said to me that 
had they been taken into my employ before I pled nolo contendere 
that they positively would not have handled my case, had I pled nolo 
contendere, because they didn't have nothing on me. 

Gentlemen, when you have had a good reputation, and as I said to 
you, I don't think I came here in '42 broke flatter than a pancake. I 
macle a lot of money. I worked hard. I have been president of the 
chamber of commerce. 

When a man has gone through life and has daughters and grand- 
children, and they threaten to break you, they will hound you the 
rest of your life. You are not shocked to death because you know that 
is what they do to everybody. 

The Chairman. Mr. Kaltenborn, did you get anything in writing 
at all from Mr. Hartmann, or any of these people ? 

Mr. Kaltenborn. No, sir. 

The Chairman. All oral ? 

Mr. Kaltenborn. Except one statement; a Charles W. Pipkin — 
you would never believe this, but this story — my name got in- 
volved • 

The Chairman. Stay with this. Did you get anything in writing^ 
and tell us anything in writing that you know of? 

Mr. Kaltenborn. No. 

Senator Wiley. What were you going to say about Pipkin? 



102 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Kaltenborn. After I took this man to the El Rancho Hotel for 
lunch at noon — and the reason I know it was an early summer is be- 
cause the clay was very bright — I left him off in front of my store, 
which is just at the Sal Saveg Hotel. It is just a couple hundred 
feet farther south. I parked my car in front of my store, told Mr. 
Hartmann that I would see if I could raise the money, and what not 
and what all, and he went on toward his hotel. I went into my office — 
our store was very overcrowded at that time; we moved in the mean- 
time. We had a very small office, and he walked — my desk was 
setting — this desk would be turned around here, and the door — the 
entrance was just where that door was, back of it was a filing cabinet, 
and Charles W. Pipkin, who subsequently was arrested on SEC viola- 
tion and fined $500 in Reno, was sitting behind that filing cabinet. 

Hartmann walked in, stuck his head into my door, saw me, didn't see 
Pipkin, and didn't see my bookkeeper, who was in another part of the 
office, who since has died, and he said to me, "Don't forget, Kalten- 
born, when you buy that copper company stock, your income-tax prob- 
lems are over." 

Pipkin spoke up and he said, "Hello, Hartmann. Where the hell 
have you been?" 

Hartmann like to fell through the floor. Pipkin heard him make 
such a statement. 

The Chairman. Where is he? 

Mr. Kaltenborn. He is out in the hall. 

So he overheard it, and in his SEC troubles he was convicted of fail- 
ing to put a few stamps on something, and was fined $500 by the SEC, 
when he was in court. He got to popping off and told about this 
matter, about the attempt to extort this money from me, and the 
SEC has been trying ever since to get me to testify about this thing. 
I have refused because I am afraid of the consequences. I am afraid 
of it now. 

Senator Wiley. That is a matter of court record, then? 

Mr. Kaltenborn. Oh, yes. 

The Chairman. Did you borrow a lot of money from the Federal 
Government somewhere? 

Mr. Kaltenborn. At the present time I am building some rental 
property of which the Prudential has bought the paper, and there will 
be FHA commitments. 

The Chairman. You handled it through the Prudential ? 

Mr. Kaltenborn. It is only a housing project. The housing proj- 
ect, however, sir, as far as the houses that I am building, which are 
FHA-financed through the Prudential Life Insurance Co., is a cor- 
poration of which I am a part owner. But I am at the present time 
building four duplexes — I want to correct that, too. These four du- 
plexes I am now building I am financing through the First National 
Bank. 

Mr. Ruymann. We are interested in who are interested in the cor- 
poration. 

Mr. Kaltenborn. Tony Tollino. 

The Chairman. Wliat is the name of the corporation? 

Mr. Kaltenborn. Paradise Realty Co. 

The Chairman. Are they all good citizens ? 

Mr. Kaltenborn. There is only one other, Toleo, T-o-l-e-o. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 103 

The Chairmax. Is he a good citizen ? 

Mr. Kaltenborn. He has been a young man that has been in town 
for years and years and years. May I ask a question, sir, if it is not 
out of order ? Is it improper that I could get an FHA loan ? 

The Chairman. I don't think so. It is just my opinion. You are 
complying with the regulations. 

^\liatever comes before us, we try to clear up. You are interested 
in a corporation and borrowing money from the Prudential, which 
handled the matter through the FHA ? 

yiv. Kaltenborx. Pruclential knows about my income-tax problem. 
And the local banks know about it. 

The Chairmax. Anything else of Mr. Kaltenborn ? 

Mr. Kaltenborn. The only thing I say to you gentlemen is that the 
only thing I am reluctant about 

The Chairman. Sooner or later you will be called on to testify in 
connection with other matters about this income-tax question, and I 
would tell the whole story just like you have told us. 

Mr. Kaltexborx. What is going to happen when you don't get all 
the people 

The Chairmax. Well, we will do our best, anyway. 

Thank you very much. 

(A press conference was held by the committee with members of the 
press, after which the hearing was adjourned, subject to the call of the 
chairman.) 



INYESTIGATION OF ORGANIZED CEIME IN INTERSTATE 

COMMERCE 



THURSDAY, NOVEMBEH IG, 1950 

Uniitd States Senate, 
SrECiAL Committee To Investigate 
Organized Crime in Interstate Commerce, 

Los Aiigeles, Calif. 

The committee met, pursuant to call of tlie chairman, at 10 a. m., at 
the Federal Building, Los Angeles, Calif., Senator Estes Kefauver, 
chairman, presiding. 

Present : Senators Kefauver, Tobey, and Wiley. 

Also present : Rudolph Halley, chief counsel ; H. G. Robinson, asso- 
ciate counsel, chief investigator; William G. Ruymann, special coun- 
sel : Herbert Van Brunt, special representative ; Julius Calm, adminis- 
trative assistant to Senator Alexander Wiley. 

The Chairman. Ladies and gentlemen, let us please have seats. 
The committee will be in order. 

The Special Committee To Investigate Crime in Interstate Com- 
merce is very grateful for the hospitality of you good people of Los 
Angeles and of the west coast. We want to express our appreciation 
to Marshal Boyle for arranging this hearing room and for many other 
courtesies that he and other ofHcials of the Federal Government have 
extended to us. 

The members of this committee are Senator Tobey, on my right, 
from New Hampshire, and Senator Wiley, on my left. I do not 
mean, by sitting on my left, that he is on the left of the chairman in 
political philosophy by any means. 

Senator Wiley. I hope not. 

The Chairman. If that were the case he might have had difficulty 
in getting the splendid endorsement of the people of Wisconsin, which 
he received recently. 

Senator Wiley. Once in a while you do have a lucid interval. 

The Chairman. And I do not mean, by Senator Tobey sitting on 
my right, that he is to the right of the chairman. 

The other members of the committee are Senator Hunt, of Wyoming, 
who is in Europe at the present time, and Senator O'Conor, of Mary- 
land, whose engagements with another committee made it impossible 
for him to be ]3resent here today. 

The purpose, as all of you know, of this committee is to investigate 
organized crime in interstate commerce. That is, the extent to which 
the vehicle of interstate commerce is being used by Nation-wide 
criminals, gangsters, and others, to the detriment of American society. 

By our appearance here in Los Angeles, we do not mean to imply 
that tliis beautiful city is any more crime-ridden than any other 

105 

68958— 51— pt. 10 8 



106 rORGANIZED CRIME IN INTERSTATE COMMERCE 

city of large population. Necessarily, a city of this size, with the 
communications and the transactions that go on here, is the scene of 
criminal a<'tivity of an organized nature from time to time. 

It is only the Nation-wide types of criminal activities that this 
committee is interested in. It is not our province to try to settle and 
solve local crimes. That is the province of the local people and the 
local enforcement officers. 

I think that every member of this committee feels that law enforce- 
ment, like other types of government, is good only if the local people 
are interested, and it is only successful if you have good local enforce- 
ment officers. 

In our investigation we are trying to determine what, if any, laws 
should be properly passed by the Federal Government or whether 
any present laws should be amended to try to prevent Nation-wide 
syndicates or organizations from inflicting themselves upon people, 
and to try to reduce the criminal activity to a local level so that 
local people can adequately cope with it. 

We also want to make it clear that the calling of any witness does 
not mean that he is implicated in some criminal activity. We call 
a great many witnesses to give us advice and cooperation, and gen- 
erally the assistance and help that we have had from local enforce- 
meni officers, State, Federal, and county, has been very substantial 
and most helpful. 

I think part of the best work of our committee has been that we 
have uncovered some things and also that the local people have carried 
on and cleaned up any situations that existed themselves. 

I want to take this opportunity of introducing Senator Tobey, 
who is not only a splendid statesman but a great philosopher and a 
believer in good, clean government. Perhaps he will say a few words. 

Senator Tobey. Mr. Chairman, I thank you for this privilege. I 
am very happy to come out here on the Pacific coast again and I recall, 
with amused interest today, that a great son of my own State of New 
Hampshire, the great Daniel Webster, who later became a Senator, 
standing in the Senate hall one day, cried out, "I wouldn't give a 
pinch of snuff for all the land west of the Rocky Mountains." Great 
man that he was, he lacked vision in that respect. 

We of this committee are working together, one for all and all for 
one, in a search for, and we are finding, some of the rats in the 
midst of democracy. Our work is far from ended. When we get 
through we think we can take a just and lasting satisfaction in the 
fact that we have tried earnestly, under God, to make of this Nation 
a Nation wherein dwelleth righteousness. 

The Chairman. Thank you, Senator. 

Senator Wiley, do you have some comment for the press and the 
radio ? 

Senator Wiley. Mr. Chairman, after that beautiful introduction 
,of Brother Tobey, I thouglit you would say something nice about me. 

Senator Tobey. Why don't you speak for yourself, John? 

Senator Wiley. It is difficult to say something about oneself, ex- 
cept that I am happy to be here and happy to be back in this fine 
community. 

It is too bad that we are here investigating crime. There is a 
great deal of g<X)d that we might investigate here and I am sure 
we wQuld find lo;ts,0.f it. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 107 

I echo the sentiments of my associates here, that we are not here 
to try to clean np Los Angeles. We hope, however, that if there is 
crime of a local nature or of an interstate nature, that our being 
here will prove a stimulus to the people within this locality to do the 
job that should he done. 

Xow, you and I know that cancer in a physical body can destroy 
the body very quickly. We know that crime in communities like 
this can destroy the economic and the political and even the religious 
life of a community. I think all over America we are finding that 
there is an awakening consciousness of our people to get into politics 
and to try to clean that situation up, and get into the criminal situa- 
tion and clean that up. 

I was here some 2 years ago and enjoyed my visit here and found 
a lot of lovely people and very fine people here. All I can say is that 
I am very happy indeed to be back again. 

The Chairman. Well, as all of you have observed. Senator Tobey 
and Senator Wiley's statements show the purpose of what this com- 
mittee hopes to accomplish. 

If I did not say something complimentary about Senator Wiley 
to begin with, you could all tell by the affectionate smile I gave him 
that I think he is one of the greatest Senators, at least one of the 
greatest Republican Senators, today. 

Senator Wilet. You are all right, thank you. 

Senator Tobey. That is what they call senatorial courtesy. 

The Chairman. Does any member of the press have any question 
to ask before we get started? We do appreciate your cooperation. 
I think one of the great things about our committee work has been 
that the press everywhere has been fearless in exposing to the spotlight 
of public opinion improper activities that we have uncovered, and that 
has given the people courage to go on and find the remedy. 

Member of the Press. I had a question, Senator. 

Do you have any comment on Governor Warren's crime commis- 
sion and its work? 

The Chairman. Personally I have not had a chance to read 
all of the reports of the crime commission. Our committee has fol- 
lowed the work of the California Crime Commission from its incep- 
tion. We think it is a strong and splendid commission. It has done 
an excellent service. 

We feel that one of the best ways to get at situations locally is by 
the establishment of crime commissions. We have cooperated with 
them everywhere we have found that they existed. 

Senator Wiley. Did your question imply whether or not we ap- 
proved of the recent election in this State ? 

The Chairman. One Democrat got elected here, I understand. 

As to the accusations that have been made against the members of 
the internal revenue department, that is, of course, a matter that this 
committee is interested in. We want to get the facts about that, and 
study the facts very carefully. The accusations are, of course, serious, 
and after we, at least, get the picture from whatever angles may be 
presented, giving everyone an opportunity of being heard, we will 
make some findings and arrive at some conclusions and make some 
recommendations in the matter. 



108 ORGANIZED CRIME IN INTERSTATE COMMERCE 

But, speaking for myself, and I am sure for the other members of 
the committee here, we think Governor Warren's crime commission 
has done a splendid job. 

Is there anything else? 

Mr. Halley. There is nothing else, sir. 

The Chairman. I would like to introduce our chief counsel, 
Mr. Rudolph Halley, who is the spark plug of our staff, and has shown 
splendid judgment and energy and ingenuity in carrying on the work 
of this committee. 

The chief of our investigative staff is Harold G. Robinson, whom 
I am sure all of you know and who was formerly with the California 
Crime Commission, to whom we are indebted for his splendid work. 

Also present is Mr. Julius Kahn, who is Senator Wiley's adminis- 
trative assistant, and who has accompanied the committee on many of 
its trips for hearings and has been of great service to the committee, 
almost as great in his service as the Senator himself sometimes while 
the Senator has been campaigning. 

We will have a short intermission at 12 : 15 and may have some- 
further statement to give you at that time. 

We will start our hearing now. It will be an executive hearing this 
morning and this afternoon, and we may have part of our hearing 
open tomorrow. 

Members of the Press. Do you think you will get to Mickey Cohen 
today ? 

The Chairman. Probably not. 

Mr. Halley. Probably not. 

The Chairman. Probably he will be heard tomorrow. 

Mr. SiTiONG. May he be excused until tomorrow then ? 

Mr. Halley. Yes ; until tomorrow morning at 10 o'clock. 

The Chairman. I think we had better start our hearing in the 
morning at 9 : 30. He can be excused until tomorrow morning at 9 : 30. 

Mr. Strong. Thank you, sir. 

The Chairman. Thank you, ladies and gentlemen. We will see 
some of you at 12 : 15 this afternoon. 

(Whereupon the following proceedings were held in closed executive 
session.) 

executive session 

The Chairman. The order of the chairman of the committee, with 
reference to only one member of the subcommittee being unable to 
swear witnesses and to take testimony, stands for this hearing. The 
order was made on yesterday. 

Our first witness will be Mr. Jewell. 

Mr. Jewell, 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. Jewell. I do. 

TESTIMONY OF AUTHUR C. JEWELL, UNDER SHERIFF OF 
LOS ANGELES COUNTY, CALIF. 

Mr. Halley. What is your full name ? 

Mr. Jewell. Arthur C. Jewell. 

Mr. Halley. What is your occupation ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 109 

Mr. Jewell. For the last 18 years I have been under sheriff of Los 
Angeles County. 

Mr. Halley. And do you hold that position today ? 

Mr. Jewell. I do, yes. 

Mr. Halley. Where do you reside ? 

Mr. Jewell. 6103 Barrows Drive, Los Angeles 48. 

Mr. Halley. Would you state the jurisdiction and the duties of 
the sheriff's office ? 

jSIr. Jewell. The duties of the sheriff is laid down in the code. He 
is the chief law-enforcement officer of the county and it takes in 
the entire county territory, which is some 4,083 square miles, I believe. 

]Mr. Halley. ^\liat are the duties of the sheriff ? 

Mr. Jewell. To preserve the law ; to be an officer of the court ; serve 
all processes handed to him. To form posses in time of need, if there 
be a time of need to aid the county. He in an officer of the court, as 
you know, of the superior court of the county. 

Mr. Halley. Does the jurisdiction of the sheriff extend into the 
city of Los Angeles ? 

Mr. Jewell. It does in the matter of State laws; yes, sir. Of 
course, as long as the cities have their regular police departments, we 
do no go in there unless we are asked in. Our duties are practically 
to police the unincorporated i)ortions of the county. It is a rather 
large area in this county. 

]\Ir. Halley. In the unincorporated areas of the county, do you have 
full responsibility for law enforcement or are there other law-enforce- 
ment agencies which overlap ? 

i\Ir. Jewell. The only other agency there would be, sir, would be 
the California Highway Patrol, in the matter of the regulation of 
traffic, and the constables of the various townships within the county, 
of course. 

]SIr. Halley. Would you give the committee the benefit of your 
views as to law enforcement in Los Angeles County ? 

Mr. Jewell. Well, I believe they are as good as there is anywhere 
in the United States. Of course, there is no such thing as perfection. 
I don't think any person, with any intelligence, would say to you 
there is no crime or anything like that in Los Angeles County. If a 
statement like that were made, you would know that we were either 
foolish or asleep or something. I happen to have been a member of 
the sheriff's office for approximately 40 years; it will be 40 years if I 
stay until next April, and I know that from the time that I came in, 
to date, there have always been hues and cries and all that sort of 
stuff about crime. We have endeavored to do a good job in the sheriff's 
office of Los Angeles County. I think that the record speaks for itself. 

We probably have the largest number of inhabitants in our county 
jail, in the custody of the sheriff, that any county of the United States 
may have. 

I believe at the present time our count would run approximately 
4,000 men and women. 

Senator Tobey. Where is the jail located in the city? 

Mr. Jewell. Right across the street, right across from the Federal 
Building, at the Hall of Justice. That is our security jail, sir. In 
addition to that security jail, we have an honor ranch on the ridge 
route, in Castaic. We have five honor camps in the mountains, with 
the personnel of those honor camps building roads. 



110 ORGANIZED CRIME IN INTERSTATE COMMERCE 

We also have a juvenile center over here with juveniles in what is 
termed as Biscailuz Center in East Los An^jeles. 

So our diflPerent jails and places like that are scattered in that 
manner. We wouldn't have a ])uilding large enough to accommodate 
all the prisoners that we have in our county jail. 

We also, as you know, are custodians of the Federal prisoners for 
the marshal and the immigration people. We take a great many of 
their prisoners over here. 

Senator Tobey. Do you have a State constabulary? 

Mr. Jeavell. We have a California Highway Patrol, and their prin- 
cipal duty is to enforce tlie motor vehicle act on the State roads. 

Senator Tobey. When it comes to the perpetration of a major crime 
that jurisdiction is vested in the county officials? 

Mr. Jewell. That is right, sir. 

Senator Wiley. Except in cases of overt acts of felonies, the sher- 
iff's office has no jurisdiction to go in and interfere with crime, has it? 

Mr. Jewell. Pardon, Senator? 

Senator Wiley. Except in overt cases, shootings, or anything like 
that, the ordinary crime, 3'ou do not have any authority, by virtue of 
being sheriff, that you can go in and interfere? 

Mr. Jeweijl. You mean the duties of the sheriff? Well, the sheriff 
has no part in going into any part of his county in case of a crime, as 
such. 

Senator Wiley. Except in cases of felonies? 

Mr. Jeavell. Felonies, that is right, sir. 

Senator Wiley. You would have to have a warrant to arrest in 
ordinary misdemeanor cases? That is what I am principally talkhig 
about. Is that right ? 

Mr. Jewell. Uidess you see it yourself. The law is plain on that 
all over the United States, 

Senator Wiley. I suppose Avhat we are interested in here is the dif- 
ferent phases of gambling and things like that, which I take it Mr. 
Halley will be getting around to. 

How many prisoners do you have all together in the county ? 

Mr. Jewell. At the present time around 4,000. I didn't get the 
exact count this morning. 

Senator A¥iley. And what is your population of the county? 

Mr. Jewell. About 41/4 million, sir. 

Senator Wiley. What about the State laws here in relation to 
gambling ? 

Mr. Jewell. Well, we enforce them. We have a vice squad con- 
sisting of 17 men for a territory as big as Los Angeles County is. 
They are on two shifts. They work overtime, which they do many 
times, and then they are entitled to time off. They are on a 44-hour- 
Aveek basis and that is what they are paid for under the hiAv. I think 
we are doing a mighty good job, considering the force we have and the 
population in the county itself. 

Senator Tobey. Are there any gambling houses running open today 
in Los Angeles County ? 

Mr. Jewell. Not that I know of. 

Senator Tobey. If you knew of them you would close them up and 
arrest the perpetrators ? 

Mr. Jeaat:ll. That is right. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 111 

Senator Wiley. If you could get it, of course. 

Mr. Jewell. You have to get in to get the evidence ; you all know 
that. You are an attorney, Senator, and you know that, sir. 

Senator Wiley. That is what I am getting at. Is it the function 
of the vice squad under the jurisdiction of the sheriff, to ferret out these 
things ? 

Mr. Jewell. We do, sir, and that is our business. We get a lot of 
information. You gentlemen know, and I don't have to tell you that, 
that a police department or a sheriff's office is just as good as its in- 
formants and information. It would be utterly impossible to hire that 
many men and women to get out and watch every angle of that 
aspect in a county as large as this, and be able to be there when a crime 
is committed and say, "Stop." It couldn't be done. That is what 
ruined national prohibition, because it was impossible for the forces 
of the Federal Government to have these people all over to enforce 
that law. 

Senator Wiley. How would you characterize or how would you 
designate racketeering in the county ? 

Air. Jewell. Well, racketeering in the county, I don't think there is 
very much of it. We have had, certainly, some characters here that 
have been accused of racketeering and gangster methods, but I know 
that we have done everything we could do. We have a patrol, a gang- 
ster patrol, that goes around the county in various places and watches 
the activities of these known people who we believe maj^ be connected 
with rackets. We have watched them very carefully. We have a 
daily report on their activities, but we have yet failed — ^I should say 
we have not failed, except for one or two instances, to find these 
people where we get the proper evidence, to arrest them and prosecute 
them. 

Senator Wiley. Have any of your businessmen been shaken down 
by anyone? 

Mr. Jewell. I have never heard that, sir. I think, as far as I know, 
and I think probably the chief of the largest' police department in 
the county of Los Angeles can tell you that, that I don't Imow of any 
instance where the businessmen have been shaken down and made 
to pay tribute to anyone. It hasn't come to my attention, at least, 
and I think the records will bear that out. I know not in recent years, 
anyhow, if that ever has been the case. 

Senator Wiley. This is a rather personal question, Sheriff. How 
about the character of the law-enforcement officials? 

Mr. Jewell. Of Los Angeles County ? 

Senator Wiley. Yes. 

Mr. Jewell. Excluding myself, sir, I will say the}' are fine. I don't 
believe anywhere in the United States, where you gentlemen may 
travel, that you will find a higher caliber of men and women in law 
enforcement than you find here. 

In the first place, since civil service went into effect, and that was 
about 1913, sir. when the county charter went in, as far as the county 
is concerned, and they used to be appointed by the elected sheriff. 
They called it the spoils system, I am a product of that. 

I was appointed first and inherited civil service. I think the sheriff 
or sheriffs then tried to pick men of pretty high caliber. We had 
no women deputies then, because it was to his advantage. If he took 



112 ORGANIZED CRIME IN INTERSTATE COMMERCE 

people in there who weren't beyond reproach in the community, he 
wouldn't have lasted very long. 

Now, since civil service, they are supposed to have a high-school 
education or its equivalent. They are supposed to be of the age of 
23, originally; now it is down to 21. They had to bear a fine repu- 
tation in the community. They were fingerprinted and those finger- 
prints went through to the Federal Bureau of Investigation. 

Senator Wiley. Your judgment relates not only to the sheriff's offi- 
cials but also to the police officials? 

Mr. Jewell. Absolutely. I don't think there is a finer police de- 
partment in the country than the Los Angeles Police Department. 

Mr. Halley. Do you feel that you have a sufficiently large force of 
men? 

Mr. Jewell. No, I do not, sir, and I think that everyone will tell 
you that same thing, every director of law enforcement will tell you 
the same thing ; they never feel that they have a sufficient number of 
men. 

Now, we have a large county here and we were compelled to put 
on a one-man radio car in the daytime for the matter of economy, sir. 
We do not think it was fair, because somewhere in the outlying sta- 
tions, through the Ridge Route and the desert country out there, if 
one man gets out and he is, perhaps, 15 or 20 miles from his station 
and he has a two-way radio, of course, that would be better, but he is 
there alone. If anything happens he hasn't got a chance in the world, 
jou know, to get word to anyone. That is true down around the 
Roosevelt Highway going way down yonder from Los Angeles city 
limits to the Ventura County line. 

Our county is growing incessantly and new people are coming in. 
We haven't the opportunity here, either the sheriff's office or the 
police department, the police department of this city, because it is the 
biggest one, to investigate people moving into neighborhoods. 

I was raised in the town of Buffalo in western New York. There 
I know exactly how they used to do police work in those da5^s. They 
had what they called precinct detectives. The^^ made it their busi- 
ness to go around to the various precincts to get acquainted with the 
new people moving in and finding out sometliing about them. They 
would learn all these things. At that time, when I was there, we had 
a better opportunity of knowing people. Of course, we didn't have 
the congestion of population that we have today, but I think in those 
days the police department was cognizant of all the people that came 
into the community. In a very short time they found out all about 
them, where they came from, and something about their backgrounds. 

It is impossible to do it here. They are moving all the time. I 
came out to California, after I had been in the Spanish-American 
War, and then went back East and came back liere again about the 
time of the fire in San Francisco. Then I came clown to Los Angeles. 
I have seen this little place grow, in the 45 or 46 years that I have 
been here, from a little pueblo to a big city. 

Mr. Halley. Can we presume that with that growth there came 
an influx of gangsters from otlier parts of the country ? 

Mr. Jewell. Naturally. Then, if you know, as a lawyer, sir; what 
they call attractive nuisance, that is something else that has to be met. 
In the old days they had their problem too, but not to any great extent. 
It is true that in New York City and in Chicago, they have their con- 



ORGANIZED CRIME IN INTERSTATE COMMERCE 113 

fidence people for the purpose of creating crime, and so forth. Now, 
we have attractive nuisances here. We have some of the wealthiest 
people in the country living out here. We have the large motion- 
picture industry, which I have had the pleasure of seeing grow from 
a very small beginning. Then we have retired men from the Army, 
Navy, Marine Corps, business people, and so forth. 

Naturally, this is a fertile field for people who want to be confidence 
people and things of that sort. The motion pictures have attracted a 
lot of fine folks. 

Mr. Halley. Turning your attention to the people who have been 
engaged in racketeering activities on a large scale, would you name 
the people who in recent years have been engaged most seriously in 
such operations ? 

Mr. Jewell. I couldn't be able to give you the names of these people 
today ; I couldn't even begin with that. There have been a lot of folks 
that have been accused of many things, but they have been arrested 
and tried many times, but never have been convicted in our courts. 

Mr. Halley. Would you say that today there are or are not operat- 
ing in your county any racketeers engaged in illegal operations on 
a large scale ? 

Mr. Jewell. On a large scale, I would say yes. 

Mr. Halley. You would gay there are ? 

Mr. Jewell. No, I would say there are not, but I would say on a 
small scale there always will be a certain form of racket, as you know 
them ; there will always be a certain kind of people who will commit 
burglaries and robberies, writing phony checks and things like that. 
We are never going to eliminate that. I don't know of any syndicates 
or I don't know of anyone directing the large operations. 

Mr. Halley. What is the situation with respect to gambling? 

Mr. Jewell. Gambling, as far as gambling goes, we check them up 
occasionally, but there are no gambling houses here that I know any- 
thing about. If there were we would eliminate them. They have 
these little spots, you know. They give out notice to their clients and 
they get down to these one-night stands. We know that. You know, 
as a lawyer, unless you get there and get some of the evidence, you 
can't prosecute them in court. 

Mr. Halley. Bearing in mind the problems of catching these 
people and convicting them, you are able to state from your general 
knowledge of your jurisdiction whether bookmaking and gambling 
on a large scale has been carried out ? 

Mr. Jewell. There have been lots of bookmakers around. There 
are all kinds of bookmakers. There are those established in a place 
and they have telephones and their runners and all that sort of stuff. 
Then there is the curbstone bookmaker and the kind of bookmaker 
that takes little bets in barber shops, cocktail bars, beauty parlors, and 
so on. We have arrested many, many bookmakers. 

Mr. Halley. '\^nio have been the people engaged in the largest 
operations of which you have had cognizance ? 

Mr. Jewell. We have never been able yet to determine, that I know 
of, any syndicate or any leader thereof. 

Mr. Halley. Have you been able to determine whether any person 
or group of pereons have made their living, at least in part, by collect- 
ing moneys from gamblers for either information or protection or 
any other purpose? 



114 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Jewell. The only thing I know of there, sir, is that I have 
heard of these things but I don't know of any specific instance myself; 
none. 

Mr. Halley. Do yon recall the Guarantee Finance Co. ? 

Mr. Jewell. Yes ; I know about that, sir. I never knew the Guar- 
antee Finance was in existence, nor neither did the sheriff, until the 
State come and took it over. 

Mr, Halley. It was actually discovered by the California Crime 
Connnission, was it not? 

Mr. Jewell. I understand that they probably discovered it, first, 
sir. If I remember rightly, it was the corporation commissioner who 
went in there and closed the place up. 

Senator Tobey. After they discovered it ? 

Mr. Jewell. After it was discovered. 

Senator Tobey, Therefore the credit goes to the California Crime 
Commission ? 

Mr. Jewell, That is right. 

Senator Tobey. And then the other law-enforcement officials fol- 
lowed their path? 

The Chairman. Was that in the city or in the county? 

Mr. Jewell. Just over the line. 

The Chaikman. How did you miss knowing about it? 

Mr. Jewell. I wouldn't know about it any more than any other 
corporation just doing business under a license with the State. 

The Chaikmax. Certainly with the number of bookmakers and the 
wire service coming in, you should have known something about it? 

Mr. Jewell. I understand our vice detail had knowledge that some- 
thing was wrong and they were working on the thing in conjunction or 
with knowledge of the crime commission's investigator at that time. 
I know of cases where they followed many agents from this place and 
made arrests ; I know that. I think the record will show the number 
of arrests they made of the people doing business outside of that, I 
think they covered the place pretty well. I iniderstand they even had 
someone watch the thing there and called up these telephones, called 
to these phones from time to time, to find out if they were active. 

Mr. Halley. Sheriff, can you state whether or not it is the fact that 
a bookmaking operation such as the Guarantee Finance, in particular, 
being located just outside of the city limits and being of common 
knowledge, that law enforcement is laxer in the county than in the 
cit:^'? 

Mr. Jewell. I don't think that is so. May I interrupt to say this : 
We haven't got the personnel for the large territory that we have to 
cover. The city has a large territory too, but we haven't the per- 
sonnel. Now, when you figure at the time that Guarantee Finance 
was going on, I think our vice detail at that time amounted to 15 per- 
sons for a county as large as this, I know they have been doing a very 
good job. All i know is the reports they give to me. I never went 
out and did any field work in my life in vice, I have to depend solely 
on those who are working directly under the sheriff to do a good job 
and do an honest job. Now, they made the reports of their activities 
and of those that we arrested. 

We have, as I said, a gangster squad that goes out aiul prowls 
around the county, and they make a report stating what they have 
done and seen and this and that and the other thing. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 115 

Mr. Halley. Have you had occasion to remove any of your deputies 
for malfeasance of office? 

Mr, Jewell. Malfeasance in office? 

Mr. Halley. Yes. 

Mr. Jewell. You mean for accepting emoluments or anything else? 

Mr. Halley. For any cause whatsoever. 

Mr. Jewell. I don't know that we have removed them from office. 
We have made transfers from time to time, the sheriff has, of his 
personnel. That has been a matter that we have done for years and 
years. I don't remove anybody. I don't have the recollection of re- 
moving anyone except that we let a person go a couple of weeks ago 
and that was because he abused one of our citizens and attacked him 
without provocation. We got him discharged. He was tried before 
the civil service commission. 

Mr. Halley. Returning to this Guarantee Finance case, did your 
office participate in the raid on the Guarantee Finance? 

Mr. Jewell. I don't believe so, sir. 

Mr. Halley. It is my understanding that a Mr. Harold Robinson, 
chief investigator for the California Crime Commission, telephoned 
the sheriff's office and I believe spoke to you. 

Mr. Jewell. No, he didn't; he spoke to the sheriff, I believe. 

Mr. Halley. And invited the sheriff to participate in that raid ? 

]Mr. Jewell. I don't know whether he telephoned or whether he 
came to the office personally. The sheriff called up the vice detail. 
Carl Pearson was the captain at that time, and he went down there. 
I understand that it wasn't handled they way it should have been. 
Now, if he would have come to me, I can tell you now what I would 
have done, and if the investigator had told me who he was I can tell 
you what I would have done. I wouldn't have said anything. I would 
have gotten on the phone and called the vice detail and I would have 
said, "This is Mr. Robinson of the Crime Commission. He wants 
your services." I wouldn't even have told them where he wanted them 
to go. I knew nothing about it personally until after the whole thing 
had happened. I think Mr. Robinson can tell you that he never 
talked to me. 

Mr. Robinson. That is correct, sir. 

Senator Tobey. What happened when the sheriff was notified? 

Mr. Jewell. As I undei-stood the thing, sir, he merely called up the 
captain of the vice detail and sent, I think, Mr. Robinson down to 
him. 

Am I right about that ? 

Mr. Robinson. We called Sheriff Biscailuz and advised him of the 
fact that the corporation commissioner was moving in on the place 
at 10 o'clock the next morning and thought it would be advisable if he 
had a man there. Nobody appeared. When, after the corporation 
commissioner or commission had gained access to the premises and 
it was found to be a very extensive bookmaking outfit, I personally 
again called the sheriff about 3 o'clock in the afternoon and explained 
to him that we, as the crime commission, were not an action agency. 
The corporation commissioner's jurisdiction was only confined to the 
loan agency premises downstairs. I told him it would be most ad- 
visable to have an enforcement official gain access to the big telephone 
I'oom upstairs. The sheriff asked that I talk to Captain Pearson of 



116 ORGANIZED CRIME IN INTERSTATE COMMERCE 

the vice detail, and I again recounted what had heen found. Cap- 
tain Pearson replied that all I had established was that there had been 
bookmaking, and that I couldn't then establish that bookmaking was 
being conducted, such as would give him the right of making a forced 
entry into the premises, and that he did not want to get into any 
complications over the thing. So the representatives of the sheriff's 
office did not appear on the day of the Guarantee Finance raid, when 
it was raided. 

The Chairman. "Wlien was this Guarantee Finance raid conducted? 

Mr. Robinson. January 27, 1948. 

Senator Tobey. You testified in the earlier part of your remarks, 
you made the statement, dogmatically, that everyone here knew that 
the greatest aid to the discovery of crime was to the extent and the 
value of the information which was in the hands of the authorities. 
I wonder if you wouldn't amend that and put even more important 
than that is the definite purpose and the indefatigable will to uncover 
crime wherever it exists. Isn't that more important than even your 
information, the indefatigable will to uncover crime wherever it 
exists? That is the fundamental that you build up from. That is 
basic and fundamental, and you have to build up from there. First 
you have to have the will to uncover crime. Sheriff. 

Mr. Jewell. Yes, that is right. 

Mr. Haij^y. I take it, had you been in charge, you would have acted 
differently. 

Mr. Jewell. I would have done that, sir. If Mr. Robinson had 
brought it to my attention that he wanted help, I would have given 
him help. I would never have told that help what they were going to 
do. He represented the crime commission of the State of California, 
with the sovereign power of the State. I wouldn't have hesitated at 
all. I have nothing to conceal nor has anyone had anything to conceal 
on this matter. 

Mr. Halley. It would appear, undoubtedly, that Mr. Robinson 
should have telephoned the sheriff in the first instance rather than 
you ; the sheriff was the one to call, was he not ? 

Mr. Jew^ell. That is probably right. The sheriff did what he 
thought was right. He just transferred the call over, because it was 
bookmaking and things of that sort. He referred them over to his 
vice detail. 

The Chairman. Mr. Jewell, isn't it well known that the attorney 
general of your State, Mr. Houser, had been protecting the Guar- 
antee Finance Co. and other bookmaking operations for a long time? 

Mr. Jewell. Only hearsay is wdiat I know. sir. 

The Chairman. You are a professional officer and you should know. 

Mr. Je-svell. I only know from hearsay. I don't know Mr. Houser 
personally, that he has personally protected anyone for doing a wrong 
thing. 

Senator Tobey. Do you think that Houser is an honest man? 

Mr. Jeavell. I am not going to express an opinion on that. 

Senator Tobey. You can speak freely here. 

Mr. Jew^ell. I don't know\ As far as I know, he has been the 
district attorney of Los Angeles County and the attorney general 
for the State of California. I have heard many, many things, but 
as far as my dealings with him are concerned, I just couldn't say. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 117 

Senator Tobey. Your expression doesn't amount to a damn, sheriff. 

Mr. Je\a'i:ll. I will say I do not know of an instance where he did 
a dishonest thing. I can say that truthfully. 

Senator Tobey. He is out now, isn't he ? 

Mr. Jewell. He got defeated. 

Senator Tobey. Shakespeare wrote in one of his plays, "For which 
relief much thanks." 

Mr. Halley. In any event, 3'ou cannot make the same statement 
of Attorney General Howser's deputies, can 5'^ou ? 

Mr. Jewell. I don't know all his deputies. 

Mr. Halley. At least one was convicted, was he not? 

Mr. Jewell. I know a lot of them who are decent fellows. I know 
Kenny Lynch, whom I have known for a long time. Mr. Matoon was 
up in his office, and his reputation goes beyond reproach, and there 
are many others. I don't know all of his deputies. I know one of 
the last ones he appointed up there was Mike Reardon, former chief 
of police of the city and county of San Francisco. 

Mr. Halley. Do you know any of the deputies about whom you 
cannot say something good ? 

Mr. Jewell. No. 

Mr. Halley. Were any of them ever convicted of crimes ? 

Mr. Jewell. Not to my knowledge. I understand some of his in- 
vestigators were convicted. I understand they were convicted of so- 
liciting in Mendocino County. Sheriff Broadus is the man who made 
the arrest. They were convicted, two of his people, who were investi- 
gators in his office. 

Mr. Halley. They were actually convicted, were ihej not ? 

jMr. Jewell. I understand so, yes. 

]Mr. Halley. For bribery ? 

Mr. Jewell. For bribery or something else. 

Mr. Robinson. Mr. Jewell, I just want to clarify my previous re- 
marks. Was an investigation conducted by your office of a deputy 
sheriH who did appear on the premises of the Guarantee Finance Co., 
not knowing that the corporation commissioner's men were there, and 
asked "if the smoke had blown over yet" ? 

Mr. Jewell. I remember that. 

Mr. Robinson. Did your office take action on that ? 

The Chairman. Repeat that again, if you will. 

Mr. Robinson. He was a deputy from the Firestone Station. 

The Chairman. What was his name? 

Mr. Robinson. The name has escaped me at the moment. He came 
into the premises of the Guarantee Finance sometime in the afternoon, 
and not knowing the presence of the officers from the corporation com- 
missioner's office, who were over behind a partition, he asked the book- 
keeper of the Guarantee Finance Co. if the smoke had blown over yet. 

The Chairman. Is that right, Mr. Jewell ? 

Mr. Jewell. That is quite right, sir. We went into that as soon as 
we found out about it. We found out the man was a member of the 
Firestone Station. So you gentlemen will understand this, every year 
the Sheriff's Association of Los Angeles County puts on a rodeo and we 
sell tickets to it. So the men in the various districts go out and sell 
tickets. This fellow had a certain clientele out there that he sold 
^ ickets to. 



118 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. What is this individual's name that we are talking: 
about ? 

Mr. Jewell. I will have to get that from the office; I don't 
remember. 

So we investigated that and found out that, yes, he went out there,, 
as he had year after year, selling tickets. The first time he went in 
there apparently the corporation commissioner went in and had taken 
over. So he beat it out. He always went out there in uniform, as 
they do in other organizations that sell tickets for benefits, you know^ 
for police or firemen benefits, so the next day on the way out he was 
back there again. He probably made this remark that Mr. Robinson 
has stated. I know he must have because I heard that. That fellow^ 
really, was just as innocent of any wrongdoing or any thought of any- 
thing being wrong as you gentlemen here are. 

The Chairman. Supposing we ask you to give his name and have 
him come in. 

Mr. Jewell. I will be glad to do that. 

The Chairman. Was he fired, or what happened to him? 

Mr. Jewell. Oh, no ; he didn't do anything wrong. 

The Chairman. What did he mean by, "Has the smoke cleared up' 
yet?" 

Mr. Jewell. I don't know wliat he meant bj^ that, sir, but he cer- 
tainly did no wrong there as we could see it. 

The Chairman. If that isn't wrong, I don't know wliat is, wanting 
to know if the smoke had cleared yet. If a deputy sheriff comes into 
a bookmaking place and asks if the smoke has cleared out yet, don't 
you think something is wrong there? If he didn't know what that 
meant, then he is too dumb to be an officer, and if he did know h© 
should have been fired. 

Senator Tobey. He knew it was a bookmaking place. 

Mr. Jewell. I don't think he knew that. 

Senator Tobey. What did he think, that it was a Sunday school ? 

Mr. Jewell. He knew there was some trouble down there. He 
knew that the corporation commissioner and someone else had taken 
those people over. He knew that, no doubt, but he probably didn't 
know any reason why they were doing it and he merely asked that one 
dumb question. When he saw a thing of that sort he shouldn't have 
gone back there again. Those people doing things like that, they are 
wrong, and we don't want that kind of patronage anyhow for the 
Sheriff's Relief Association, and I for one wouldn't liave gone there 
if I were selling tickets. If I thouglit it was a legitimate business I 
wouldn't have hesitated going in there. 

The Chairman. If you thought it was a legitimate business you 
wouldn't hesitate to go in there. If you thought it was an illegitimate 
business, then what ? 

Mr. Jewell. If it was illegitimate, and if we had any proof of that,, 
we would have taken some action. If I thought it was a shady place, 
something shady along the line where they may want to come back 
and ask for favors because they bought a dollar ticket or a $2 ticket 
to a rodeo, I wouldn't want to do business with them, or neither would 
you. 

The Chairman. From your testimony, it looks like you would 
just shy away from a place because you thought it might be a shady 



ORGANIZED CRIME IN INTERSTATE COMMERCE 119 

business and you would not want to sell them a ticket. If you thought 
it was shady you ought to go in and clean it up and not sell tickets 
to them. 

Senator Wiley. Isn't it clear in your mind, sheriff, that a member 
of your force knew what was going on in this placed 

Mr. JE^^^:LL. There was a suspicion going on, but they couldn't get 
any evidence, as I understand it, from the reports on that from the 
people that we had to depend upon to get this information. 

Senator Wiley. I mean this chap that went in there making that 
crack. He knew something had happened, didn't he? It just isn't 
common sense to imply that he didn't know what was going on. 

Mr. Jeavell. Well, one would think that. If I had gone in there, 
and had I known about these people and all that, then I would say 
the same thing as you have. I would say this man must have had 
some knowledge or something or he wouldn't have made that kind of 
a crack. 

Mr. RoBixsoN. Did it subsequently develop that other officers of 
your othcer the sheriff's office, had made loans at the Guarantee 
Finance? 

]\Ir. Jewell. It came out in the paper that some had made loans 
in that company. Until they were discovered as to what they reall}' 
were and what they were organized for, I think the people doing busi-. 
ness with them would have more right to suspicion them than any 
other company making loans. 

Mr. Halley. Would you have any doubt that your deputy or 
deputies going into that building would not, at least have reason to 
be suspicious of the operation there? 

Mr. Jewell. I have never been inside of the place mj^self , but people 
tell me that if you went into that business, when they were doing busi- 
ness before the matter happened, that it would be like going into any 
other business where they are making loans, either on automobiles 
or on furniture or real estate or whatever it may be. There was 
nothing to indicate outwardly that you were going into a place where 
upstairs they had some bookmaking contrivances going on, or any- 
thing else. 

Mr. Halley. You yourself said you thought this particular deputy, 
who asked if the smoke liad blown over, had reason to be suspicious.. 

Mr. Jewell. As I understand it, he went in the day when Mr. Robin- 
son and the corporation connnissioner's men went in. He then backed 
out, and why he came back there the next day I don't know. I don't 
think the man had any intent of doing any wrong or had any guilty 
knowledge of anything. 

Mr. Halley. Did he at that time, or at any other time, ever file anv 
complaint with your office or report to your office indicating that the- 
Guarantee Finance Co. should be investigated? 

Mr. Jewell. Not to ni}- knowledge, sir. 

Mr. Halley. Your office never did investigate that company in anv 
way, did they i 

Mr. Jewell. Oh, yes. We had been watching it, and Captain Pear- 
son and his investigators had been Avatching it, for pretty near a year, 
and we had men down there, following the cars that left there. That 
is why we had been able to knock over some of these little bookmaking 
places in the various parts of the county. 



120 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. Then you knew it was a bookmaking operation be- 
cause you knocked over some of these little fellows out there. When 
Mr. Robinson asked the help of the sheriff's office to come down and 
have a representative, you didn't even send anybody down, did you ? 

Mr. Jewell. I knew nothing about that. 

The Chairman. I am not talking about you, personally, but the 
sheriff's office. 

Mr. Jewell. I understand my chief. Gene Biscailuz, probably did 
the thing he thought was right to do, and to refer them to the vice de- 
tail. If the captain over there handled the thing wrongly, that is one 
of those unfortunate things. I know if he came to me, sir, and if you 
were in the same position that Mr. Robinson was in, I wouldn't hesi- 
tate to give you exactly what you wanted. That is all I can really 
say, sir. 

Senator Wiley. How many more industries or businesses have 
moved out of the city into the county to operate like that ^ 

Mr. Jewell. I don't know, sir. I don't know of any of them that 
actually did that for that purpose. 

Senator Wiley. Did it ever occur to you that there was anything 
suspicious about the fact that, even if they were legitimate, they 
should leave the boundaries of the City of Los Angeles and go out 
into the county ? 

Mr. Je^vell. There is one thing they do that for ; they get out of a 
city tax and they do sometimes establish corporations in an unin- 
corporated part of the county to have one direct tax. They do it 
for that purpose, and not because they expect to get by with anything. 

Mr. Halley. Sheriff, prior to the raid conducted by the California 
Crime Commission and the corporation commissioner's office, had not 
the city police department attempted to take some steps with regard 
to the Guarantee Finance Co. ? 

Mr. Jewell. All I know about that, sir, is what the record shows, 
and about the lieutenant. 

Mr. Halley. Lieutenant Fiske? 

Mr. Jewell. I think that is the name. He went out there and got 
into the place and found these telephones and so forth. I understood, 
then, that he notified our vice detail, and I understand from Pearson 
he notified Pearson and others there that they were working on the 
thing, trying to garner the evidence to get them. If we could have 
made a case there, that would have been another matter ; that would 
have been a conspiracy matter and it would have been a felony. Then 
they could probably have prosecuted them along that line. 

Tlie Chairman. You mean that some member of your department 
was in there and saw the telephones and the books? That a member 
of your department really went over there ? 

Mr. Jewell. Yes; but the telephones themselves are not sufficient 
cause, unless they are in use and you get the markei'S and the bets 
and so forth. 

Mr. Robinson. Senator, may I explain on the record 

The Chairman. What is the name of this officer who was in there 
and saw^ that? 

Mr. Robinson. We just got the badge number. 

Mr. Jewell. That is Lieutenant Fiske. 

Mr. Robinson. May I explain that situation ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 121 

The Chairman. Yes. 

Mr. Robinson. Lieutenant James Fiske, of the Los Angeles Police 
Department, is in charge of bookmaking investigation. He was con- 
stantly being harassed by the runners operating within the city limits 
and phoning their bets back to this telephone headquarters known as 
the Guarantee Finance Co. Lieutenant Fiske went out of the city 
limits, went up through a skylight and down into that telephone room. 
He was out of his jurisdiction, and did not make any arrests, but did 
tear up all of the markers so that they were at a loss how to settle 
their bets for that particular day. I think he did that on two occa- 
sions. That action on his part was productive of a letter from Captain 
Al Guasti of the sheriff's office, directed to Assistant Chief of Police 
Joe Reed, asking that the police officers stay out of the county terri- 
tory. 

The Chairman. Productive of a letter from whom ? 

Mr. Robinson. From Al Guasti. He is a captain in the sheriff's 
department and is head of the antisubversive division, I believe. 

The Chairman. The letter is to whom ? 

Mr. Robinson. To Joe Reed. We attempted to find the letter, and 
Lieutenant Fiske told us he had it among some personal papers of his, 
but could not locate it. 

The Chairman. Do you know that to be true, Mr. Jewell? 

Mr. Jewell. No; I have heard that, sir. The sheriff asked Al 
Guasti if he ever Avrote such a letter, and he denies it. I think he also 
spoke to Assistant Chief of Police Joe Reed, and he denied ever 
receiving such a letter. That is all I know about it. Personally, I 
never had anytliing to do with it directly or indirectly. 

Senator Wiley. What is the approximate date of that letter in rela- 
tion to the time of the raid ? 

j\Ir. Jewell. It must have been prior to the time the corporation 
commissioner's men came over. 

Mr. Halley. Captain Jewell, first I would like to establish some 
of these dates, and to do it I thinli we better correct the record. The 
raid was January 13, 1949. 

Mr. Jewell. 1949, was it? 

Mr. Halley. Yes. The letter that Captain Guasti wrote to the 
police department about Lieutenant Fiske apparently was written in 
the summer of 1948 ; is that not so ? 

Mr. Jewell. No, sir; I can't remember it. I will have to go by 
memory. I thought this raid was in 1948. 

Mr. Halley. It certainly was many months before the actual raid, 
was it not ? 

Mr. Jewell. Oh, yes ; there is no question about that. 

Mr. Halley. That Lieutenant Fiske was actual^ in there and saw 
these telephones ? 

Mr. Jewell. He so stated that. 

Mr. Halley. He asked your office to take action and you did not 
take any action ? 

Mr. Robinson. He simply got scolded for what he did. I think the 
report will indicate that countless numbers of telephone reports were 
made. 

Mr. Halley. Do you know about that. Commissioner Parker? Did 
the police department ever ask the sheriff's office to help out on 
anything? 

68958— 51— pt. 10 9 



122 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Chief Parker. I recall that Fiske brought some records in from 
the Guarantee Finance Co. and was told to take them back. I don't 
know what the communications were between the sheriff and the 
assistant chief of the Los Angeles police department at that time. 

Mr. Halley. At least, as early as August of 1948, the crime com- 
mission did ask the sheriff's office to take action, isn't that so? 

I will read from the report : 

In August of 1948, reports coming to the attention of this commission con- 
firmed the extent of the boolvmaking activities at the Florence address. 

Then it goes on to state : 

A letter was addressed by the commission to the sheriff's oflBce that month, 
directing attention to these activities and forwarding copies of anonymous com- 
munications that had been received by the commission, concerning the nature of 
the Finance Co. business. The sheriff's oflSee subsequently responded that the 
activities of the Florence Avenue address were confined to distributing scratch 
sheets and other accessories used in bookmaking and that there appeared to be 
no violation of law upon which action could be taken. 

Is that the fact, Mr. Robinson ? 

Mr. Robinson. That is the fact. 

Mr. Halley. In addition to that, is it not the fact. Captain, that the 
telephone company made a number of complaints to the sheriff's office, 
pointing out that these bookmakers were using telephone service that 
should have been given to legitimate subscribers ? 

Mr. Jewell. I don't believe, sir, that is the truth, as I understand it ; 
at least, not to my personal knowledge. I have asked about that, and 
they tell me, our vice detail tells me they had the help and the coopera- 
tion of the telephone company to notify them that they used those 
phones for illegal purposes. 

Mr. Halley. Here is what the crime commission said in its third 
progress report, dated January 31, 1950 : 

The special crime commission has in its possession six reports sent to Captain 
Pearson, Los Angeles sheriff's oflice, by the telephone company, telling him book- 
making was being conducted at the AVhittier Boulevard address. These reports 
to Pearson, which began in August of 1947 — 

which w^ould be a year and a half prior to the raid — 

had no apparent results. 

Then there is quoted in the report a letter, and I would like to read 
this into the record for the committee, one of these letters to Captain 
Pearson, which reads as follows : 

Sheriff Case 1143 

Los Angeles, November 17, 19^8, 
C. P. Peters, 

Chief Special Agent, Los Angeles, Room 1261 : 

Information has been received indicating that the telephone service listed 
below is being used for illegal bookmaking purposes. While there may be reason- 
able doubt as to the alleged unlawful use of the service, this information is being 
given to you in accordance with the provisions of System Instructions No. 44. 
Keport submitted by Mr. McFadden. November 16, 1948. Address 3972 Whittier 
Boulevard. 

Date installed : July 22, 1948. 

The following facts have been reported : 

This location is next door to our public oflice on Whittier Boulevard. It was 
reported on December 17, 1947, when Mr. Bragg had a single line AN0800 
(case 76.5). 



ORGANIZED CRIME IN INTERSTATE COMMERCE 123 

Did you Imow a Mr. Bragg ? 

Mr. Jewell. They may know about Mr. Bragg in the office, but I 
don't know him personally. 

Mr. Halley. Then it goes on to report the following facts : 

It was reported again when the service was changed to rotary under AN3-6198 
(case 1045). 

Installer stated definitely bookmaking. Manager feels it is not helping our 
public relations in that district to have a bookie next door to office where we take 
applications for service. Too many people, who are unable to get a telephone, 
call attention to the fact that the bookie can get telephones, why can't we. 

Signed : G. II. Nichol for general sales manager. 

Action taken : Given to Captain Pearson, November 19, approximately 9 : 15 
a. m. 

Senator Tobey. Is Pearson still with the department? 

Mr. Jewell. Yes, sir. 

Senator Tobey. Why ? 

Mr. Jewell. Because there is nothing that we know about that man. 

Senator Tobey. There it is right there. You knew about that, 
didn't you ? 

Mr. Jewell. Yes. 

Senator Tobey. Didn't you even slap his wrist? What have you 
done ? 

Mr. Jewell. Not a thing in the world. 

Senator Tobey. Then I don't think you are fit to be deputy under 
sheriff, in my judgment. I think you are a dead one, as far as a police 
official goes. If I were a citizen of Los Angeles I would rise up and 
call out, "Unclean, unclean.'' 

The Chairman. May I ask, is there somebody in the sheriff's office, 
a captain or someone, who was operating with Mickey Cohen as a part- 
ner or something like that around Sacramento ? 

Mr. Robinson. I think in the transcript of the microphone record- 
ings taken in Mickey Cohen's living room, there was discussion in 
which he said, the party speaking said, "Guasti has a piece of the 
gambling plant in Burbank." 

I think Sheriff Biscailuz, when that testimony came out, when that 
transcript came out, stated it was undoubtedly another Guasti that 
was referred to. 

The Chairman. That is the head of the detective squad, is it ? 

Mr. Jewell. He is in charge of the antisubversive squad, sir. 

The Chairman. Is that Capt. Al Guasti ? 

Mr. Jewell. Yes. 

The Chairman. Who was it that called Cohen or said that ? 

Mr. Robinson. There was a microphone operating in Mickey Cohen's 
living room for a matter of a year and a half. Suddenly the tran- 
script of the listening post on that microphone got in the hands of the 
newspapers and was pretty well publicized. That is an excerpt from 
that microphone recording. 

The Chairman. Mickey Cohen said that ? 

Mr. Robinson. As I recall it, it was Curley Robinson who was seated 
in the living room of Mickey Cohen's home, or, at least, a voice identi- 
fied as Curley Robinson's. 

The Chairman. That said that Guasti had a piece of a place where? 

Mr. Robinson. In Burbank. That can be identified as the Dincara 
stock farm. 



124 ORGANIZED CRIME EST INTERSTATE COMMERCE 

Mr. Halley. Captain, bearing in mind all of the facts which have 
been related here, all the complaints in writing by the telephone com- 
pany, the complaints by the Los xlngeles city police, the statements 
made by your deputy when he found the raid in progress, about 
whether the smoke had cleared or not; the failure of your office to take 
any action, the fact that your deputy went into that place, allegedly to 
sell a ticket, during a period when you say your office was investigat- 
ing this place, would you say that your office had performed its duty 
with relation to the Guarantee Finance Co. ? 

Mr. Jewell. Well, from the evidence that they had at that time, 
I think I could say "yes." They have given me the truth about the mat- 
ter, and all I know is what they have given me on the report. I have 
no personal knowledge of anything of that sort except what I know 
from the reports and what I have heard. 

Mr, Halley. You never worked on the case ? 

Mr. Jewell. Never in my life, sir. 

Mr. Halley. Did you ever direct the work on the case? 

Mr. Jewell. No. 

Mr. Halley. Did you ever receive reports of the work in progress? 

Mr. Jewell. Yes ; I have. They send a report in every month, the 
vice detail, and the narcotic detail, to the sheriff and a copy to me. I 
read them. 

Mr. Halley. During that period of time, did you ever call the peo- 
ple in charge of that investigation before you and insist on action? 

Mr. Jewell. Yes ; I did ; and I also talked to Pearson at that time 
and he told me that he had had cooperation. He was working with 
the telephone company. They were working, assisting him, trying to 
get this evidence. Now, that is what he told me. That is all I know 
about the thing. He called the folks and had talks with them. I think 
the investigators of the grand jury had talks, and I think they went 
before the grand jury and told all these things. 

Mr. Halley. But nothing happened? 

Mr. Jewell. Not a thing has happened; no. 

Mr. Halley. Why is it that the California Crime Commission was 
able to get the evidence, which you, the sheriff in your own county, 
were not able to get ? 

Mr. Jewell. They were able to get the evidence, sir, that would 
stand up in court. 

Mr, Halley. Didn't they get that evidence ? 

Mr. Jewell. Yes. That matter of the Guarantee Finance Co., they 
went through court and they are now appealing it. They didn't get 
convicted for bookmaking. There is a matter there that at the present 
time it is on appeal, as I understand the thing. What the upper court 
may do to the thing I don't know. 

Mr. Halley. Is it your position that they should not have raided 
that place and put it out of business ? 

Mr. Jewell. They should have done it, with all that evidence there; 
yes. As I said a little while ago, and I will repeat, if Mr. Robinson had 
got in touch with me and asked for men, I would have sent them to 
Mm. 

Mr. Halley. If the lieutenant of the Los Angeles Police Department 
was able to go through a skylight and actually find tickets of book- 
making operations, which is certainly first-class evidence of bookmak- 



ORGANIZED CRIME IN INTERSTATE COMMERCE 125 

ing, on two occasions, why couldn't one of your deputies get in there 
and do the same thing ? 

Mr. Jewell. I don't know, sir. I understand in the report that the 
captain of the vice detail submitted to the sheriff, if my recollection 
is correct, that he stated there that his men had gotten in there, but 
found these telephones, I think, 18 or 19 of them — I am not sure 
which — but they found no evidence of an operation and they found no 
evidence of bookmaking in this particular room where these phones 
were at. I understand they got in the same way that Fiske said he got 
in there, through the skylight. 

Mr. Halley. Of course, if the reference is made by the phone com- 
pany and by tlie crime commission, then, perhaps, every citizen in 
the county or many of them were aware of the fact that bookmaking 
was going on and could tie the bookmaking to these telephones; isn't 
that so ? 

Mr. Jewell. There is no evidence that came to our office that I 
understand of that nature. 

Mr. Halley. When your men found telephones in that office, did 
they make any attempt to get in touch with the Los Angeles Police De- 
partment and see whether the evidence of the telephones could be tied 
into evidence that the police department had, so the whole thing could 
be put together to make a case? 

Mr. Jewell. I don't know, sir; I have no recollection of that ever 
coming to my attention. 

MV. Halley. Could you find out about that? 

The Chairman. Is that your job to know those things, Mr. Jewell? 
What do you do as under sheriff ? 

Mr. Jewell. As under slieriff, I represent the sheriff. I am prac- 
tically, you might say, an office man. I sit there and meet the people. 

The Chaieman. Whose duty is it to know what is being done? 

Mr. Jewell. It is my duty and the chief of the division, and so forth. 
We have to depend on these things. I also came to the conclusion 
that a man is doing a good job unless I find out otherwise, and I also 
believe that he is honest unless I find out otherwise. I am not suspi- 
cious of every Tom, Dick, and Harry that comes along. Carl Pearson 
is the captain of the vice detail and is an excellent man, a good officer, 
and an honest fellow. I had no reason to believe otherwise and I don't 
believe it yet. 

Mr. Halley. Has Pearson been transferred from the job ? 

Mr. Jewell. Pearson was taken out and put into another job. He 
is a pretty good mechanic. We had a man retire recently who had 
charge of the automobiles and the transportation and so forth. Pear- 
son has wanted to get away from vice for some time. So the sheriff 
transferred him over to this job on the retirement of this other man. 

Mr. Halley. Maj^ I preface this by saying the next question will 
be on another subject. Do any members of the committee or Mr. 
Robinson have any questions on this subject? 

Senator Wiley. I do. 

Senator Tobey. Wasn't there a man connected with your vice squad 
here some time ago named Guy McAfee? 

Mr. Jewell. Not in our vice squad. He was on the police depart- 
ment years ago and resigned from the police department. 

Chief Pakker. He was fired for gambling. 

Senator Tobey. Do you know what he is doing now ? 



126 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Chief Parker. He was a member of the Los Angeles Police De- 
partment many years ago. He was removed for shooting craps in the 
assembly room, but that is many years ago, before I joined the de- 
partment. 

Senator Tobet. He is shooting something else now. 

Senator Wiley. Just one question. Of course, I have never lived 
in a big community like this, but I have been district attorney years 
ago. It was the function of the police department in the city and the 
function of the sheriil's department in the county to bring to my atten- 
tion any evidence. I would then have a warrant issued and see if 
there was probable cause. 

I want to loiow what was dojie in this connection by the district 
attorney. The district attorney, I take it, is the county attorney here? 

Mr. Je's^'ell. That is right. 

Senator Wiley. What was done to collaborate with him? 

Mr. Jeavell. Well, I think that they took the matter up with him. 
He had an investigators' squad too. I think they collaborated with 
his chief investigator and members of his office and he had men go 
out likewise. He had these people, various ones, come up, and they 
asked them questions and so forth. They used whatever evidence our 
office could furnish them, I presume, in the matter of bringing indict- 
ments against this Guarantee Finance Co., individuals and officers. 
The district attorney of this county is a man that has been here a good 
many years. He is a very fine gentleman, a good district attorney, 
and he is doing everything he can humanly possibly do to take care 
of these things. 

We have always gotten along nicely with him, and I think the other 
law-enforcement agencies have likewise gotten along well with us. 
The district attorney wants to cooperate. At the present time he has 
cooperated to this extent, that we have combined our vice squads on 
bookmaking, we have combined the sheriff's vice squad on bookmaking 
with the district attorney's squad, and other police departments are 
giving assistance as well, and I tliink our record of arrests recently 
in bookmaking has been enormous. It has been probably 6 weeks or 
so ago that they organized this combination squad. I think they have 
made over 100 arrests for bookmaking. I think they got that many 
convictions. 

The Chairman. Is there anything else ? By the way, is Long Beach 
in your jurisdiction? 

Mr. Jeavell. Long Beach is in the county of Los Angeles ; yes. 

The Chairman. Do you operate in Long Beach ? 

Mr. Jewell. We operate this way, sir : we have some superior courts, 
four branches out there, I believe. We have four bailiffs out there. 
We have a branch of six for our civil division, I believe. 

The Chairman. I mean do you have criminal jurisdiction out there? 

Mr. Jeavell. Only jointly with the city and then under the State 
Penal Code sections ; yes. 

The Chairman. How about Joe Irvin ? He is a well-known book- 
maker and has given an affidavit that he was. 

Mr. Jewell. I have heard of him. 

The Chairman. Have you tried to find out who he is ? 

Mr. Jewell. I think our vice detail has, and our former chief of 
police, and they have done what they could, and I think he has been 



ORGANIZED CRIME IN INTERSTATE COMMERCE 127 

arrested for bookmaking. I don't know only from hearsay. He lias 
never been arrested by onr office. 

The Chairman. He stated in a deposition, in a case, that he was 
a bookmaker, and in spite of that no effort has been made to pick 
him up. 

Mr. Jewell. As Senator Wiley said, you have to get the evidence. 
His mere statement of that fact would not convict him in court unless 
he plead guilty. If you went there to prove that fact, you would have 
to have evidence. Am I right, Senator, on that? 

Senator Wiley. The thing I can't understand, sir, is after Robin- 
son's gang of investigators investigated and got the dope and after 
the city policeman went through the skylight twice and got the dope, 
and after this business has been going on out there right in the open, 
it looks to me if the whole matter had been placed in the hands — should 
have been placed in the hands of the prosecuting officials. At least, 
when I was a youngster I wouldn't have hesitated a minute to issue 
a warrant there. There Avould have been a warrant issued before the 
court and the fellows brought in. I am wondering why it wasn't done 
in this instance. IMaybe it was done finally ; I don't know. 

Mr. Jewell. I am not familiar with all those facts, sir. I have 
lived a long time, but I don't remember every little instance that has 
happened even in my lifetime. These things speak for themselves. 
You could find that out by going into the records of the district attor- 
ney's office and find out what complaints have been issued, and so forth, 
and all that. I couldn't tell you offhand about all those things. 

Senator Wiley. What is the function of the Vice Squad? 

Mr. Jewell. The function of the vice squad is to prevent vice and 
eliminate in the county of Los Angeles, principally in the unincor- 
porated district, all vice. 

Senator Wiley. And detect vice and prosecute for it? 

Mr. Jewell. No question about that. Now, the sheriff has given 
me a statement to hand to Senator Kef auver. I didn't know what you 
wanted to do with it. 

Now, as to this other matter, I just talked to Mr. Robinson and he 
asked me to come down and I came down. 

The Chairman. Let me have the statement. This is a letter from 
the sheriff. 

Mr. Jewell. I have never read that myself. 

The Chairman. At this place I want to put into the record, as 
exhibit No. 3, the letter to the chairman of this committee, together 
with data of arrests and reports of his office, that has been submitted 
to us tlirough Under Sheriff Jewell. 

Mr. Jewell. Do you want to mark that as an exhibit? I took it 
out of his file. I don't think he has anything in his file to replace 
that. 

Senator Tobey. It is in a good cause, you know. 

Mr. Jewell. I don't have any objection. You have the original in 
your file. That is his copy. I think anybody who makes a statement 
for a committee has a copy, anyway. 

Mr. Halley. We have it in our file. 

The Chairman. We will consider the thing to be an exhibit and we 
will substitute our copy and then return yours to you. 

(Exhibit No. -S is on file with the committee.) 



128 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Jewell. If it was my personal file, I would say take it. I am 
just acting as an agent for the sheriff. 

The Chairman. Will you see that this is returned to the sheriff? 

Mr. Jewell. Yes. 

Mr. Halley. Captain Jewell, do you, as a matter of routine law 
enforcement in the county, try to keep track of the activities of certain 
people who are suspected of being law violators? 

Mr. Jewell. Yes, sir. We have a squad that travels around every 
night in various localities. 

Mr. Halley. Who are some of the leading law violators whom you 
suspect of activities in your county — illegal activities ? 

Mr. Jewell. The principal one is the one everybody mentions, Mr. 
Cohen. There are many other associates of his, and so forth, but they 
have out here what they call legalized gambling in Hawthorne and one 
or two other places out here. They are supposed to play legalized 
draw poker. There is no law in the State of California against draw 
poker. They play under certain conditions and it is licensed by the 
city. We have our people go through there occasionally and watch 
those people there that patronize those places. We watch out for 
hoodlums. We have already, through the help of the Los Angeles 
Police Department and the district attorney's office, we get reports 
from various States and cities in the United States. 

Mr. Halley. Now, you understand you are here to be helpful to 
the committee. 

Mr. Jewell. I want to be helpful. 

Mr. Halley. We appreciate your statement about the general ac- 
tivities of the sheriff's office, but the question is : What are the names 
of some of the more important criminals whom you feel you should be 
watching in your county? That is the question, Mr. Jewell. You 
have named Mickey Cohen ; who else ? 

Mr. Jewell. I named him because he is the one that is most talked 
of. He seems to be exhibit A. 

Mr. Halley. You should know, at least, as much as appears in the 
newspapers about that. 

Mr. Jewell. That is about all I know, as far as those criminals are 
concerned and those who have been arrested. 

Mr. Halley. Would you say that Mickey Cohen is the only one? 

Mr. Jewell. No ; there are many others, but you are asking me a 
different question now. If I had had any notice of this hearing or 
a subpena, I would have brought all the things necessary that you 
wanted me to say and I would have had it here with me. 

Mr. Halley. We are interested in what you, as the chief deputy, 
with 40 years' experience, know about your own office. 

Could you state what activities are taken by the sheriff's office to 
keep an eye on Mickey Cohen's activities ? 

Mr. Je"\vell. Well, we have, as I said before, we have this gangster 
detail that gets out and watches all known hoodlums, people who come 
in, and strangers, coming around and watching their activities. They 
make a report and that report comes in to the sheriff through our 
chief of detectives. 

Mr. Halley. Let's get down to the facts. What do you know about 
Cohen's activity in the county ; what do you know about his activities? 

Mr. Jewell. I do know this: He went out in the county district 
out there and bought a building and he established a haberdashery 



ORGANIZED CRIME IN INTERSTATE COMMERCE 129 

place and a tailor shop in there. He also had, as I understand, a 
jewelry shop at one time. 

Mr. Halley. Was that at 8800 Sunset Boulevard ? 

Mr. Jewell. I think so. He sold out there, and I understand that 
place is closed now. I don't think anybody is in there at the present 
time. I don't have any recollection of it. 

Mr. Halley. Do you suspect him of operating any illegal activities 
at this time? 

Mr. Jewell. If we had evidence of it, sir, we would arrest him. 

^Ir. Halley. I am not asking you that. 

Mr. Jewell. It hasn't come to my knowledge that anyone has 
fingered him for any illegal activities at this time. 

Mr. Halley. Have you asked the Los Angeles Police Department 
if they have any information that would give you leads about Mickey 
Cohen ? 

Mr. Jewell. I haven't personally, sir, but I presume our detective 
detail and vice detail have cooperated with the police department. 

Mr. Halley. You have no knowledge that they have made a specific 
request for that? 

Mr. Jewt:ll. No. 

Senator Tobey. Does somebody tail him from the time he leaves his 
house until he gets back? 

Mr. Jewell. From what I read in the newspapers I think that they 
do. He lives in the city. He had these legitimate businesses in the 
county, from all outward appearances, and no one j^et has said that 
they were illegitimate. 

Mr. Halley. Did you ever hear that he operated gambling clubs in 
the county? 

Mr. Jewell. I heard it but I have never been able to prove it. 

Mr. Halley. What did jou do to try to prove it? 

Mr. Jewell. We have knocked over those places where it is claimed 
he had an interest in, and he never was there. So far these people who 
have been arrested didn't do any talking. 

Mr. Halley. Did you, at least, close those places up ? 

Mr. Jewell. Oh, yes, we took the material out of those places, and 
so forth, and destroyed it, as we have in the past. We probably de- 
stroyed in the last 18 months I don't know how many hundreds of slot 
machines, and how much mojiey we have taken out of there and placed 
it in the county treasury. I don't know all those facts. I would have 
to be a statistician and have books and be able to get some other in- 
formation to give you those figures. 

Mr. Halley. Where did you get the evidence to close up the gam- 
bling clubs ? 

Mr. Jewell. Generally through some information that comes in; 
either some of our boys, investigators, find that out, or information 
comes in, and then we go out and send out and investigate. When we 
find the places operating we, naturally, knock it over and make the 
necessary arrests and confiscate the money on the tables. 

Mr. Halley. Did you close the place at 126 North LaBrea? 

Mr. Jewell. What number? 

Mr. Halley. 126 North LaBrea in Burbank. 

Mr. Jewell. I think our office did. That has been very recently. 
We have taken several places in Burbank. That is an incorporated 



130 ORGANIZED CRIME IN INTERSTATE COMMERCE 

city, by the way. It has been the custom, and I think a decent one, 
that if you hear of anythino; in another city you notify the police 
cJiief over there of that. Then, if he doesn't act, we go in and act and 
then bring the police department in on the kill. 

Mr. Hallet. You are not able to tell this committee of any ille- 
gal activities of which you suspect Mickey Cohen at this time in 
Los Angeles ? 

Mr. Jewell. Personally I cannot, sir ; that is honest and sincere. 

Senator Wiley. What about your knowledge from the records you 
have been talking about ? 

Mr. Jewell. I will have to get the reports and look them over. I 
don't know^ how retentive your memory is, but mine is limited. I know, 
just in a general way, of these things here, and I would have to get 
reports and look them up to be able to tell you about that. The only 
information that I have and the only knowdeclge that I have. Senator, 
is what I get from reports of subordinates, and that is all. Personally, 
I have no personal knowledge. 

]Mr. Halley. I am going to ask Mr. Robinson to ask you a few ques- 
tions. 

Mr. RociNSON. Captain Jewell, I wonder if you could explain, for 
the benefit of the Senators, what is known as the Sunset Strip area. 

Mr. Jewell. The Sunset Strip area has been a thorn in the side 
of the sheriff's office as long as it has been a Sunset Strip. It seems 
these folks went out there and established restaurants and lesbian 
joints, and one thing and another. Incidentally, there were, years 
and years ago, some very famous gambling casinos out there. I don't 
know how long ago it was that we put the Clover Club out of business, 
knocked the door down and took the tables and one thing and another, 
but it was before World War II. 

Since that time there have been spotty places out there. They 
have worked from time to time, but they call them spot locations, as 
you well know, Mr. Robinson. They get out and decide they are going 
to have a little game and they notify their clients, those who want to 
play, and they get together there for a one-night stand. Unless you 
have knowledge of that, then they can operate for one or two nights 
and then close down. By the time you have any knowledge that this 
is happening, they have flown to some other location. 

Mr. Robinson. It was in the Sunset Strip area that the recent shoot- 
ing of Mickey Cohen occurred ; is that right ? 

!^Ir. Jewell. That is right. We had men out there watching things, 
and they just left about 5 minutes prior to Mickey coming out. 

Senator Tobey. Too bad, wasn't it? 

Mr. Jewell. Yes, it was. They had been out night after night out 
there and nothing ever happened. This happened to be the one time. 
They had at that one time, I presume — they went earlier that night 
because at that time Mr. Cohen had a guard there from the State, sort 
of a bodyguard, and then he had his own henchmen always around. 
That was an unfortunate thing. 

Mr. Robinson. Did Brenda Allen, the famous "madam," operate in 
county territory ? 

Mr. Jewell. I think at one time she was in county territory. It was 
one of those borderline cases where part of the building is in the city 
and part of the building in the count5^ If my recollection is correct, 
and this is only on recollection — I don't know, because I haven't the 



ORGAXIZED CRIME IN INTERSTATE COMMERCE 131 

report here — but it seems to me that we did make an arrest in one place 
there in conjunction with the police department. They gave our vice 
detail knowledge of the place and we knocked it over, but I think 
that was on one occasion only that she operated in the county that we 
had knowledge of. 

INIr. Robinson. Does Jimmy Contratto operate in county territory ? 

Mr. Jewell. I understand he has. He was arrested recently for 
operating books. I think he got the biggest fine of any convicted 
bookmaker, to my knowledge, in the county of Los Angeles and in the 
histor}^ of the county. 

Senator ToBEY. Was that his first arrest? 

Mr. Jewell. Oh, no. 

Senator Tobey. Why didn't they put him in jail instead of fining 
him ? 

Mr. Jewell. Tliat is up to the court. 

Mr. Robinson. Does Hymie Miller operate in county territory? 

Mr. Jewell. I think he used to operate somewheres on the east side. 
Recently, I understand that he was over in Culver City territory with 
some kind of a racket, where they bet on baseball games. 

Mr. Robinson. The records of the recent arrests of Hymie Miller 
were turned over to the sheriff's department, I understand. 

Mr. Jewell. Yes ; they were turned over by the chief of police. I 
don't know how many different organizations that we have written to 
for about various individuals, asked about it, and the district attorney's 
office and our office worked jointly on that, trying to garner informa- 
tion. When anyone comes in to look at those records, we let them 
look at them. There was a representative of our office and of the 
district attorney's office at the time of the investigation of the records 
that was present. 

Senator Tobey. Where is the Sunset Strip, so-called ? 

Mr. Jewell. I can explain this to you, Senator. You don't know 
the topograph of the city, and sometimes it is hard to explain it to 
someone, where the city breaks off and the county begins, because you 
go through a short ways and then you go into another city and back 
into the city of Los Angeles, so it is hard to define it. The Strip is 
on Sunset Boulevard. 

Senator Tobey. Is that what is called the Five Million Dollar or 
Ten Million Dollar Mile? 

Mr. Jewell. No. You go to Sunset Boulevard and then you go out 
Sunset Boulevard. 

Chief Parker. After you pass Laurel Avenue you are in the county. 

Mr. Jewell. Then you go on until you strike Beverly Hills. 

Senator Tobey. Wliat does the "Sunset Strip" refer to? 

Mr. Jewell. It is a county strip that goes through there, just like 
wliat we call down here, to give you an idea, w^e have a "Shoestring 
Strip" down here. The continuity of bringing Los Angeles together — 
the city of Los Angeles took in a strip a mile wide from the old city 
limits of Los Angeles to Wilmington and San Pedro so they could 
bring those people into the city of Los Angeles — that is what they 
call that strip. Here is a strip of land that is still unincorporated. 
So they named it just "the strip." That is all I know about it. 

Senator Tobey. It is in the jurisdiction of the county; is that right? 

JNIr. Jewell. That is right. We have a substation out there known 
as the sheriff's substation on Fairfax. 



132 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobet. When tliey tried to kill Mickey Cohen, did they 
kill his bodyguard ? 

Mr, Jewell. They wounded a bodyguard, sir, and the other one of 
his henchmen, Neddie Herbert, he died from the wounds. Mickey 
got the least of any of them. He got two or three pellets in him and 
that was all. 

Mr. Robinson. An investigator for the attorney general's office 
was wounded ; is that right ? 

Mr. Jewell. Yes. He used to be a former highway patrolman. 

Mr. Robinson. Do you recall the shooting of Big Greenie Green- 
berg ? 

Mr. Jewell. I only learned it or remember it by reading it in the 
newspajjers. That didn't happen in the unincorporated territory of 
the county. I heard so many of those things and there were several 
down on Beverly Boulevard recently, and then Siegel was shot out 
in Beverly Hills, and many others. I don't remember that particu- 
larly, Mr. Robinson. I just have a faint recollection of it. Our office, 
as far as I know, had nothing to do with that case at all. As far as 
making any arrests in that matter, or the trial of any person for "Big 
Greenie" Greenberg; no. 

Mr. Robinson. How about the shooting of "Meatball" Gamson ; was 
that in the county? 

Mr. Jewell. That was not in our unincorporated district. "Meat- 
ball" Gamson was on Beverly Boulevard or out in Beverly Hills, I 
don't know which. 

Mr. Robinson. How about the shooting of "Hookie" Rothman? 

Mr. Jewell. That was where they fired through the window out 
on the Sunset Strip. They said they were trying to get Mickey, but a 
lot of people thought that was a set-up to put him up as a clay pigeon. 

Mr. Halley. I have no further questions of this witness. 

The Chairman. How about you. Senator ? 

Senator Wiley. Nothing further of this witness. 

Senator Tobey. No further questions. 

The Chairman. Very well, that will be all. 

Mr. Halley. The next witness is the District Attorney Simpson. 

TESTIMONY OF WILLIAM EDWARD SIMPSON, DISTRICT 
ATTORNEY, LOS ANGELES COUNTY, CALIF. 

The Chairman. Mr. Simpson, 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. Simpson. I do. 

Mr. Halley. What is your full name, sir? 

Mr. Simpson. William Edward Simpson. 

Mr. Halley. Your address, sir? 

Mr. Simpson. Business or residence? 

Mr. Halley. Your residence address. 

Mr. Simpson. 2241 North Catalina, Los Angeles, Calif. 

Mr. Halley. What is your business or occupation ? 

Mr. Simpson. District attorney of Los Angeles County. 

Mr. Halley. How long have you held that position? 

Mr. Simpson. Since December of 1946. 

Mr. Halley. Is that an elective office? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 133 

Mr. Simpson. It is, yes. 

Mr. Halley. For liow many years does j^our term extend? 

Mr. Simpson. Well, I was appointed to succeed Mr. Houser when 
he became attorney g:eneral, and I finished ont his unexpired term of 
2 years. I was then elected for an additional 4 years, 2 years of which 
will have expired on the first Monday in December of this year. 

Senator Tobey. You will go out of office the same time Harry 
Truman does? 

JMr. SiiVrpsoN. When does Harry go out ? 

Senator Tobey. Two years from now ; that is the inside dope. 

Mr. Simpson. I hope that I will still be there 2 years from now, 
regardless of what happens to Harry. 

The Chairman. You stay in as long as Harry and you will be in a 
long time. 

Senator Wiley. I am neither a prophet nor the son of one, but I 
think Brother Tobey is right. 

Mr. Halley. Mr. Simpson, what is the jurisdiction of your office? 

Mr. Simpson. To a very large degree, and I would say 99 percent, 
our duty is the prosecution of felony cases. We handle some misde- 
meanor cases but a very limited number. The reason for that is, 
the larger cities of the countj^ of Los Angeles, such as the cities of 
Los Angeles, Long Beach, Pasadena, and similar cities, are incor- 
porated and organized under charters which provide that the city 
attorney shall issue and prosecute all misdemeanor violations occur- 
ring witliin the city, whether violations of city charters, city ordi- 
nances, or State laws. The result is that, except in unincorporated 
areas, we handle no misdemeanors. Therefore, our business and 
jurisdiction is limited, oh, I would judge, 99, perhaps 99-plus percent, 
to the prosecution of felony cases. 

Senator Wiley. How many assistants have you ? 

Mr. Simpson. We have in our office a total, as I recall, of 73 lawyers, 
including myself, two unclassified or non-civil-service deputies, they 
being the assistant and the chief deputy, and all of the remaining 
deputies are civil-service employees. 

Senator Wiley. Has the district attoi-ney's office a special crime 
investigation squad of its own? 

Mr. Simpson. Li a sense we have and in a sense we do not have. We 
have a bureau of investigation, consisting of about 50 persons, in- 
cluding stenographers, clerks, and other persons of that type assigned 
to it. The one division of that unit that could be properly called an 
investigating unit or squad being of about 10 or 12 men, including, 
oi in addition to which there are four accountants or auditors who 
devote their time to the investigation of corporate security violations 
and what we call grand theft bunco. 

The available investigators for other work is quite limited and I 
would say not to exceed 15 or 18, and they receive such assignments 
as may be required in order to supplement the investigations origi- 
nally made by the police departments of the cities in which a crime 
has occurred. 

I mean by that. Senator, that if a deputy finds out, in the course 
of his preparation of a case for trial, that' there is something addi- 
tional needed by way of evidence, he avails himself of the services of 
such men as are free in our bureau of investigation to work with the 
police department and supplement that investigation. 



134 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The majority of the members of that squad devote their time- 
when I say "squad," the bureau of investigation— to the investigation 
of corporate securities and grand theft violations of a bunco character. 

Senator Wiley. What cooperation do you get from the county 
investigation squad ? 

Mr. Simpson. Very good. 

Senator Wiley. And from the city investigation squad? 

Mr. Simpson. Very good. 

Senator Wiley. Do you understand their function is to dig out 



crime 



Mr. Simpson. Well, I don't know that I understand what you mean, 
but if I do I will answer your question this way : If a crime is com- 
mitted in the city of Los Angeles, one of the units of the Los Angeles 
Police Department will immediately undertake the investigation of 
the matter, and, having completed the investigation and apprehended 
a likely suspect, will bring the evidence accumulated to the complaint 
division of the district attorney's office, at which place it will be re- 
viewed by a deputy in that division, who will determine whether or 
not there is sufficient evidence to warrant the issuance of a complaint 
or whether there is not. So the primary duty of the local police de- 
partment, in the city of Los Angeles and other cities, is to investigate 
crimes. 

The same thing is true of the sheriff's department in the county of 
Los Angeles. 

Senator Wiley. What I was getting at was, is it the function of the 
various squads in the city and in the county to simply investigate after 
a crime has been committed, or is it part of the squad's function to 
investigate and see that crime is not committed ? 

Mr. Simpson. I would say from my experience with the police de- 
partment of the city of Los Angeles, and also with the detective 
bureau of the sheriff's office, that there are under investigation con- 
stantly many instances in which the effort is directed to prevent the 
commission of a crime. That is my belief, because I know we have 
from time to time worked with and advised with police officers who are 
directing their efforts in that regard, and deputy sheriffs who are doing 
the same thing. 

Senator Wiley. That is all I have. 

Mr. Halley. Did you prosecute the Guarantee Finance case ? 

Mr. Simpson. Personally? 

Mr. Halley. Your office I am referring to. 

Mr. Simpson. My office did; yes. I did not personally, but the 
district attorney's office of Los Angeles County did ; yes. 

Mr. Halley. Was that prosecution successful ? 

Mr. Simpson. It was ; yes. 

Mr. Halley. How many individuals were indicted? Was the 
number 12? 

Mr. Simpson. Either 11 or 12. I think 12, and I think 11 were 
convicted, and Mrs. Welch was acquitted or dismissed by the court. 

Mr. Halley. Was Harry Sackman dismissed ? 

Mr. Simpson. I don't know whether Sackman was indicted or not; 
he may have been indicted and then dismissed. 

Mr. Halley. The record so shows. He is a tax consultant, is he not ? 

Mr. Simpson. Yes. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 135 

Mr. H ALLEY. Was he the tax consuUant for the company ? 

Mr. Simpson. That is the information that I have ; yes. 

Mr. Halley. There is still an appeal pending; is that correct? 

Mr. Simpson. That is correct ; yes. 

Mr. Halley. Did you get the full cooperation from the sheriff's 
office in connection with that matter ? 

Mr. Simpson. I would say yes, although, as a matter of fact, after 
we received the reports from the California Crime Commission, the 
investigation which led to the indictments and the production of legal 
evidence which would be admissible in a court of law in a criminal 
prosecution, that was controlled entirely by Mr. Powers of our office, 
and the deputy who tried the case, and Mr. Busse was assigned to him 
as an assistant; they worked with Mr. Kobinson, the man from the 
crime commission office. I think they availed themselves to a little 
degree or a slight degree of the services of any sheriffs, but I know they 
had some assistance down there. 

Mr. Halley. Was there any proposal to have an investigation of the 
sheriff's office or any members of the sheriff''s office, growing out of 
that? 

Mr. Simpson. None that came to my attention. 

Mr. Halley. Would you state, in general, the situation as to law 
enforcement in Los Angeles County ? Is it your opinion that as of this 
time there is any considerable amount of undetected and unprosecuted 
crime ? 

Mr. Simpson. I would say not any more than you would normally 
expect in a city of the size of the city of Los Angeles or a county en- 
compassing the area of the county of Los Angeles, with the population 
we have in the county of Los Angeles. 

Mr. Halley. Who are the principal suspected law violators and 
gangsters upon whom you believe the law-enforcement officers should 
be keeping an eye ? 

Mr. Simpson. Well, one of them who is very well known and is 
popular — not popular, but frequently mentioned — is Mickey Cohen. 
There is also this man Dragna and the Sica brothers. They are, I 
think, perhaps the principal ones, and also a man named Jimmy Utley, 
who is under suspicion constantly. 

Mr. Halley. What would you say would be the type of activities 
for which they would be suspected ? 

Mr. Simpson. My own opinion would be that, so far as Mickey Cohen 
is concerned, probably gambling, organized gambling and bookmaking 
and kindred enterprises. So far as Dragna and the Sica brothers 
are concerned, I have heard them mentioned more frequently in con- 
nection with narcotics. Utley is reputed to be a shake-down artist ; 
an extortionist. 

Mr. Halley. Have you any indication that any of these acts occur 
in interstate business or commerce and take part in criminal activities 
with people in other States and other criminals in othea' parts of the 
country ? 

Mr. Simpson. You mean the persons that I have named ? 

Mr. Halley. Yes. 

Mr. Simpson. Nothing but rumors. I have no evidence. I heard 
that when Mickey Cohen made liis trip to Chicago here some time ago, 



136 ORGANIZED CRIME IN INTERSTATE COMMERCE 

when he was rousted by the police department there, that it was for 
the purpose of raising money from some group of Chicago hoodlums. 

Mr. Hallet. What would you say about Jack Dragna ? 

Mr. SiMrsox. I don't know as to Jack Dragna. 

Mr. Halley. How about Utley? 

]\Ir. Simpson. Utley, I think, oj^erates locally principally. I may 
be in error on that. 

Mr. Hallet. What would be your view as to the Sica brothers? 

Mr. SiMPSOisr. The same as to Dragna; I don't know what their 
activities are. 

Mr. Hallet. Did you hear that the Sica brothers in the recent past 
had switched their allegiance from Cohen to Dragna? 

Mr. SiMPso>sT, I had heard that there was some split, not in the recent 
past, but it was reported about the time of the shooting out here on 
the Sunset Strip that there was a fight on between either the Sica 
brothers, alined with Dragna, and Cohen, which was responsible for 
the shooting. 

Now, whether any evidence has been developed to support that or 
not, I don't know, because none has been presented to our office. 

Mr. Hallet. To which shooting do vou refer out on the Sunset 
Strip? 

Mr. Simpson. The shooting in which this man Herbert, Avho was 
an associate of Cohen's, was killed. 

Mr. Hallet, Neddie Herbert ? 

Mr. Simpson. Yes ; that is right. 

Mr. Hallet. When did that occur? 

Mr. Simpson. I think that is about a year ago last July or longer 
than that. 

Mr. Hallet. Has that murder been solved ? 

Mr. Simpson. Not to my knowledge, it has not been ; no. 

Mr. Hallet. Have there been various criminal activities, with par- 
ticular reference to gambling, along the Strip, which have had the 
attention of law-enforcement officers? 

Mr. Simpson. Of course we don't undertake to police the Strip and 
never have. We do not attempt to operate a police department. 
From that shooting, I was told that both the sheriff's department and 
t he Los Angeles Police Department had known hoodlums under sur- 
veillance and they went into the Strip — I mean by that the Los Angeles 
Police Department went into the Strip — which is county territory, 
and they do so whenever they feel that it is necessary in the proper 
performance of their duty. 

Mr. Hallet. What are conditions along the Strip, to your 
knowledge ? 

Mr. Simpson. Now? 

Mr. Hallet. Yes. 

Mr. Simpson. From what I can learn now, it is a pretty dead place. 
There is no activity, or if there is any it is negligible. 

Mr. Hallet. What has it been in the recent past ? 

Mr. Simpson. I would say that that condition has prevailed since 
the shooting on the Strip to which I referred. 

Mr. Hallet. What were conditions prior to the shooting of Neddie 
Herbert? 

Mr. Simpson. According to all reports there was gambling and 
violations of law of a kindred nature. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 137 

Mr. Hallet. What type of violations do you refer to ? 

Mr. Simpson. Bookniaking, gambling, and that sort of business. 

Mr. Halley. Yon mean the operation of dice games and the like? 

Mr. Simpson. Yes. 

Mr. Hallet. Do yon have any knowledge of one Hymie Miller? 

Mr. Simpson. I know of him and I know of him principally through 
the arrest that was made by two Culver City police officers here re- 
cently in Culver City, where he was apprehended, or rather some of 
his men were, in connection with the operation of a pool-selling prop- 
osition on football games and baseball games and other athletic con- 
tests. 

Mr. IIall^ey. Was Miller running a rather large illegal enter- 
prise ? 

Mr. Simpson. I don't know how large it was from a physical stand- 
point, but from the information that we subsequently developed, 
through our auditors and through an examination of his books, I 
would say that, so far as money is concerned, it was a large enterprise. 

Mr. Halley. Are you prosecuting ? 

Mr. Simpson. Our Santa Monica branch is prosecuting Miller and 
his associates. 

Mr. Halley. Did you have occasion to send a list of disbursements 
by Mr. Miller to Mr. Robinson, the chief investigator of this com- 
mittee ? 

Mr. Simpson. I think I did. I think I received a letter from him 
and asked for a copy of the auditor's report, or, at least, the disburse- 
ments, and sent that on to Mr. Robinson. 

Mr. Halley. I will show you a letter dated August 2, 1950, and 
signed b^^ you, and ask you if that is the letter to which you refer. 

Mr. Simpson. That is the letter to which I refer, and the attached 
summary of disbursements appears to be Mr. Doherty's summary of 
disbursements. 

Mr. Halley. Are you familiar with the item of disbursement to one 
Mai Clark? 

Mr. Simpson. I am not ; no. 

Mr. Halley. It appear to be two checks, totaling $13,683.75. 

Mr. Simpson. No; I am not. As a matter of fact, I am not famil- 
iar, personally, with any of the items of disbursement. Those are 
mattei's which have been turned over to the auditing department of 
our bureau of investigation, and which have been investigated by Mr. 
Doherty. 

Mr. Halley. I believe that as of August 14, 1950, Mr. Robinson 
replied to you stating that Mai Clark is in the gambling supply busi- 
ness in Chicago. Would that be something you would have now 
under investigation ? 

Mr. Simpson. No. 

Mr. Halley. That is out of your jurisdiction? 

Mr. Simpson. That is out of our jurisdiction ; yes. 

Mr. Halley. Do you know anything about the Film Row Club, 
to which there are disbursements in the amount of $57,202? 

Mr. Simpson. No ; I don't. Is that the club that is supposed to be 
operating in San Francisco? 

Mr. Halley. Yes. Is it not supposed to be a lay-off bookniaking 
spot in San Francisco? 

68958—51 — pt. 10 10 



138 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr, Simpson. I think that is correct, but I have no personal knowl- 
edge of it because I have not participated personally in the investiga- 
tion. 

Mr. Hallet. In this Hymie Miller situation, you have an item of 
disbursement of $1,500, which is stated to be "Flamingo commissions 
for Hy G." Would it be your opinion that these might relate to com- 
missions payable to Hy Goldbaum of the Flamingo Hotel in Las 
Vegas ? 

Mr. Simpson. The "Hy Goldbaum" means nothing to me. I have 
never been in Las Vegas in my life and am not acquainted with any 
of the characters there, but that very well could be. 

Mr. Halley. Is your office now handling a prosecution of one Har- 
old Meltzer? 

Mr. Simpson. The case is on trial in the superior court now. 

Mr. Halley. Is he being prosecuted for the possession of a gun ? 

Mr. Simpson. That is correct. 

Mr. Halley. What can you tell the committee about his background 
and record ? 

Mr. Simpson. Well, he is an ex-convict. He is reported to have been 
at one time a close associate of Mickey Cohen. It has also been re- 
ported that some time ago the two of them split and that they havo 
been on unfriendly terms ever since. I have also heard that Meltzer 
was at one time engaged in narcotic traffic. 

Mr. Halley. Was lie reputed to have been in the narcotic business 
with Meyer Lansky of New York ? 

Mr. Simpson. I don't know about Lansky. I know he was reputed 
to have been in the narcotic business. Who his associates were, I don't 
know. 

Mr. Halley. You had him released from a subpena under which 
he was being held in Philadelphia in order to bring him back here for 
trial ? 

Mr. Simpson. Wlio? 

Mr. ILvlley. Meltzer. 

Mr. Simpson. No ; I don't think so. 

Mr. Halley. Was he not under subpena in the grand-jury investi- 
gation now pending in Philadelphia ? 

Mr. Simpson. Not according to my investigation. 

Mr. Halley. You have no information to the contrary ? 

Mr. Simpson. I have none to the contrary; no. I know there is 
a witness in the East, and I believe in Philadelphia, who testified 
before the Federal grand jury, according to our information, and 
whose presence we are endeavoring to obtain to testify here on the 
basis of the grand-jury testimony he gave before the Federal grand 
jury in Philadelphia or some eastern city, with respect to the fact 
that he either gave or sold the gun in question to Harold Meltzer. 

Mr. Halley. Do you know whether Meltzer acted as a jeweler in the 
establishment right next door to Mickey Cohen's establishment, his 
haberdashery establishment, at 8800 Sunset Boulevard ? 

Mr. Simpson. I do not. 

Mr. Halley. That would be, at least, one of the reasons he was sus- 
pected of being associated with Mickey Cohen ? 

Mr. Simpson. Yes ; if that is a fact, if you have been so advised. 

Mr. Halley. Mr. Simpson, is there anything else you can tell this 
committee that will assist it in the performance of its duties here, 



ORGANIZED CRIME IN INTERSTATE COMMERCE 139 

which, as you know, relate to seeking out evidence of organized crime 
in interstate commerce, or affecting interstate commerce? 

Mr. Simpson. I can give you this, if it is of any value to you, but, 
again, it is rumor. I think it is probably true that since the organ- 
ization of a combined antibookmaking squad last September, in which 
the sheriff's office and our office participated with the advice and as- 
sistance of the several police departments in the county, and the con- 
certed drive, it resulted against bookmaking, and I am informed that 
many of the bookmakers who found it rather uncomfortable in this 
area moved to Nevada and are transacting their bookmaking business, 
or attempting to, over the telephone. In other words, they solicit 
their former customers for bets by telephone from Las Vegas, or 
wherever they may be, and the customers, in turn, phone their bets 
to the bookmakers in Las Vegas or Reno or wherever these bookmakers 
may be operating. That, I think, is comparatively recent, although I 
also understand that large bets have been made prior to this time by 
phone from Los Angeles and various places around the county to 
gamblers in Nevada. 

Mr. Halley. I have nothing further of Mr. Simpson. 

Senator Tobey. I have no questions. 

Senator Wiley. No questions. 

The Chairman. What is your relationship to the attorney general 
or the State attorney ? 

Mr. Simpson. The constitution of California provides that the 
attorney general shall be, in effect, the chief law-enforcement officer of 
the State. 

The Chairman. Aren't you elected county wise ? 

Mr. Simpson. Yes. I have no relationship with him except as 
he is designated under the constitution and the code as an officer who 
has the authority to supervise the activities of sheriffs, and, if he 
feels that a case is being improperly handled by any district attorney 
in the State, to take charge of that particular case. That is the 
relationship that exists. 

In other words, it is a matter of power rather than relationship. 
We go ahead and attend to our business here in the county. He 
attends to his, but he does have that power. 

The Chairman. When did you start by appointment as district 
attorney in Los Angeles County ? 

Mr. Simpson. If my memory is correct, I think it was the 1st of 
December of 1946. 

The Chairman. You had quite a number of conflicts with Attorney 
General Howser over prosecutions in this county; did you not? 

Mr. Simpson. No. I have had disagreements with him on matters 
of policy, but not on prosecutions, because we have never asked his 
advice on what we should or should not do or whom or whom not 
to prosecute. We use our own judgment and have used our own 
judgment. 

The Chairman. How about the Guarantee Finance Co. ? Did the 
attorney genera] prevent its prosecution of that case, or try to? 

Mr. Simpson. No. That case was prosecuted after we got from 
Mr. Olney and the crime commission the files they had accumulated 
in connection with the hearings they were holding before the utilities 
commission. 



140 ORGANIZED CRIME IN INTERSTATE COMMERCE 

I "went to San Francisco and asked Mr. Olney to release to us any 
information that he had that would enable us to prosecute the officers 
and employees of that company; that information was provided to 
us. We, thereafter, conducted our own investigation. 

There were two different issues before the utilities commission : The 
hearings which involved the restoration of telephone service, and the 
question there to be considered was whether there was probable cause 
to believe that the telephones had been used for bookmaking. With 
us it was a matter of establishing beyond a reasonable doubt that the 
defendants were guilty of a violation of the law. 

The Chairman. I did not want to go into the details of the case, 
but this finance company had been operating, apparently, in the open 
for some time and the sheriff of this county had done nothing about 
it. There were some rumors that Mr. Honser was not very anxious 
to have anything done about it, either. I take it that your duty is 
only to prosecute after the facts are brought to you ? 

Mr. Simpson. That is correct. 

The Chairman. You don't have any inquisitorial duty of getting 
out and finding out about it yourself? 

Mr. Simpson. As a matter of fact, I never heard of the Guarantee 
Finance Co. until I read about it in the newspaper, of the hearings 
(hat were conducted before the State public utilities commission. 

The Chairman. How about the gambling ships, were they in your 
county, out at Long Beach ? 

Mr. Simpson. I think that is still a debatable question, whether they 
Wfere out beyond the limits or not, but there have been no gambling 
ships since Tony Cornero made his last attempt to operate. 

The Chairman. How long ago has that been ? 

Mr. Simpson. Oh, I don't know ; quite some time ago. Mr. Houser 
was district attorney at the time. 

The Chairivfan. Have there been any during your administration? 

Mr. Simpson. None that I have heard of. 

The Chairman. Isn't it true that they operated wide open and 
finally the Attorne^^ General of the United States did something about 
stopping them? 

Mr. Simpson. That is correct, I think. They did operate for a 
period of time, but for how long I don't know. I wasn't district 
attorney at the time and had nothing to do with the gambling ships. 

Senator Tobey. Do you consider Houser an honorable official ? 

Mr. Simpson. I would rather not answer that question. 

Senator Tobey. It won't go out of this room. We can even take 
that much off the record. 

The Chairman. That can be off the record. 

(Off-the-record discussion.) 

Mr. Robinson. I think in fairness to Mr. Simpson, the record 
should show that when the story of the Guarantee Finance Co. broke 
in the papers, Mr. Simpson made a special trip to San Francisco to 
meet with the commission and requested the records, saying he would 
take it to ultimate prosecution. He had 12 indictments returned; 2 
were dismissed. He went to trial with 10 and got 8 convictions out 
of the 10. 

Mr. Simpson. That is correct. I would like to add to that, Mr, 
Robinson, if I may, that it was indicated in the report of the crime 
commission that there was possible corruption in the sheriff's office. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 141 

That was designated as the second phase of the Guarantee Finance 
case. Since the completion of the trial the same two men who pre- 
pared and prosecuted the Guarantee Finance Co. have worked con- 
tinuously on the second phase of that case. We haven't gotten very 
far, but we are still working on it. So far as we are concerned it is 
not a dead issue. 

Senator Tobey. Will these hearings ever be published? Sooner 
or later you will be interested in reading the testimony that Under 
Sheriff Jewell gave this morning about the sheriff's department. 

The Chairman. Thank you very much, Mr. Simpson. 

I would be glad if you would make a summary, Senator, of what 
went on this morning. Senator Wiley, will you summarize for the 
committee wliat you think of the proceeclings here this morning? 

Senator Wiley. No ; I won't summarize. This is an executive ses- 
sion and I don't want to evaluate the testimony. If I did I am liable 
to be more outspoken than Senator Tobey. 

The Chairman. Before we get the press in here, w^hoever is going 
to speak, we should know what we are going to say about this fellow 
Jewell in here. 

Mr. Halley. I think the evidence could be summarized factually 
and the characterizations would be automatic. It is not necessary to 
characterize Jewell, but simply state the facts. 

The Chairman. All right, call the press in. 

(The following proceedings w^ere held in open session:) 

(Proceedings resumed in open session.) 

The Chairman. Ladies and gentlemen, this morning we have had 
Arthur C. Jewell, the under sheriff of Los Angeles County for a num- 
ber of years, present testifying. He has been questioned relative to 
law enforcement in Los Angeles County. 

In general, the testimony of INIr. Jewell was highly unsatisfactory 
to the committee as to, first, ferreting out certain activities. 

Senator Tobey. May I say to the press that the chairman of this 
committee is a past master of moderate speech also. 

The Chairman. Secondly, in cooperation with the California Crime 
Commission and with certain officers of the police department of the 
city of Los Angeles, his testimony again was unsatisfactory. Sheriff 
Bascailuz is in the State of Washington now on a police commission 
convention of some kind, and he is being invited to appear personally 
before the committee tomorrow. 

The particular matter that was outstandingly unsatisfactory to the 
committee w^as that it has been well known for quite a number of years, 
apparently, locally and throughout the Nation, that the Guarantee 
Finance Co. was one of the biggest bookmaking wire-service operations 
in the country. This information was given to the sheriff of this 
county by the California Crime Commission; reports were made by 
the telephone company in correspondence as early as August of 1947. 
Finally the Guarantee Finance Co. was raided by officers of the cor- 
poration commissioner, upon information gathered, and in company 
with the officers or with the officials of the California Crime Commis- 
sion. This was done in January 1949 ; January 13, 1949, to be more 
specific. 

It is difficult to believe that members of the sheriff's organization 
did not have information as to the transactions going on. As a matter 
of fact, they said they had gotten some of the little bookmakers but 



142 ORGANIZED CRIME IN INTERSTATE COMMERCE 

hadn't ever bothered the heart of the organization of the Guarantee 
Finance Co. 

The testimony shows that Lt. James Fiske, of the Los Angeles Police 
Department, on two occasions came in the skylight, acting outside of 
his jurisdiction of course, because he was in the Los Angeles City 
Police Department, but, nevertheless, tore up their number sheets, 
which thwarted their operations slightly. 

He was asked by the sheriff's office to stay out of their jurisdiction. 

Furthermore, when the California Crime Commission officials came 
in, they on two occasions asked the sheriff's office to have a representa- 
tive present, both for the raid and for the gathering of information, 
but no one showed up. 

Captain Jewell seems to have very little information about what 
big-time criminal activities are taking place in this county, although 
the information is generally known throughout the country. 
' District Attorney William E. Simpson also testified. The com- 
mittee has no criticism of the job he is doing as district attorney. It 
should be pointed out that he cooperated fully with the California 
Crime Commission in presenting to the grand jury and to the courts 
the evidence of the wire-service operation of the Guarantee Finance 
Co. 

He obtained 12 indictments, 2 were dismissed, and 8 convictions 
came out of the matter. 

Do you have anything to add, Senator ? 

Senator Tobey. I have nothing to add; I think it is an admirable 
summiiig up. 

The Chairman. Senator Wiley ? 

Senator Wiley. I don't think I have any particular comment to 
make at this time, except to say that I believe that the sheriff's office, 
particularly the crime-investigating branch, might well be called be- 
fore the committee and see if there is any explanation of what seemed 
to be, at least from the testimony of Jewell, a rather lax condition 
existing. 

Jewell claimed that he was more or less simply an office man and had 
been in the sheriff's office for some 40 years. He testified that reports 
were sent to him, but he also claimed, in trying to be fair with him, 
that he had no particular notice as to what he was to testify to; that 
he might have to look at the records to try to get information on the 
subject. I think it is a situation that is more or less really critical 
throughout the country, that in many places we have found that the 
sheriff's office has been rather asleep on the job, whereas some of the 
city officials have been more competent and apparently more on the job. 

I, too, was favorably impressed with the county attorney. He 
seemed to have the facts at his tongTie's end, so to speak. 

That is about all I have to say at this time. 

Member of the Press. Senator Kefauver, in other jurisdictions do 
you usually find that public officials are very fortunate in their invest- 
ments? Have you found anytliing like that here? 

The Chairman. We, have had some inferences as to investments, 
of loans being made by the Guarantee Finance Co. to members of the 
sheriff's staff, but we, in fairness to the inquiry, we haven't gone far 
enough into the matter to get the facts fully or to make any conclusions. 

]Vf E:\rBER OF THE Press. How big do they run ? 

The Chairman. We haven't the detailed information. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 143 

JNIember of the Press. Are you going to explore that? 

The Chairman. We will explore it ; yes. 

Member or the Press. Did jSIr. Jewell give any explanation for his 
own lack of information, other than that he only had reports, and also 
of the failure of the sheriff's office to cooperate with other law- 
enforcement agencies? 

The Chahoian. As to the request for assistance by the California 
Crime Commission, Mr. Jewell said that they didn't come to him. 
They came to the sheriff', and the sheriff referred the matter to, I be- 
lieve, Captain Pearson. 

He also testified that if they came to him he probably would have 
done something more active about it. 

Senator Tobey. Tliere was some evidence of passing the buck this 
morning; the national pastime was being played. I asked ]\Ir. Jewell 
if Captain Pearson was still on the job, and he said "Yes." I asked 
him why, but didn't get a very satisfactory answer from him. 

Member of the Press. You mean that Jewell or Captain Pearson 
was still on the job ? 

Senator Tobey. Pearson. 

The Chairman. The California Crime Commission in their report 
state that in August of 1948 they asked the sheriff's office, by letter, 
why they did not take some action against the Guarantee Finance Co. 
The reply they got was that their investigation showed the only thing 
they were doing was distributing scratch sheets, and they didn't have 
any information that they were doing anything in violation of the law. 

Member of the Press. Was Mr. Guasti's name mentioned in con- 
nection with the Guarantee Finance Co. ? 

The Chairman. Officer Guasti's name was mentioned several times. 

Member of the Press. In connection with the letter? 

The Chairman. Yes. 

Member of the Press. Is he under subpena ? 

The Chairman. I believe that he is ; yes. 

Member of the Press. Did you get into the wire service of that 
Brophv, that Brophy gets into ? 

The Chairman. Not as yet. 

IMember of the Press. Did you get any links with San Francisco 
this morning? 

Mr. Robinson. District Attorney Simpson testified with respect 
to the raid on the premises of Hymie Miller in Culver City. He gave 
us some information as to that. There were lay-off' bets to the Film 
Row Club in San Francisco. 

ISIember of the Press. Was that in connection with the baseball 
pool ? 

Mr. Robinson. The name of the club also appeared in the Guaranty 
Finance Co. 

The Chairman. Tlie committee will resume at 2 o'clock. Our first 
witness this afternoon will be Harry Sackman, who I believe is audi- 
tor for INIickey Cohen. 

Member of the Press. One other question, Senator. 

You mentioned when we left this morninfr, I believe, that part of 
the session would be open tomorrow. Will that apply to Mickey 
Cohen's testimony ? 

Tlie Chairman. We will make an announcement on that at the con- 
clusion of our afternoon session. 



144 ORGANIZED CRIME IN INTERSTATE COMMERCE 

How about concluding at 5 : 30, gentlemen, this afternoon ? 

Member of the Press. Are you going to subpena anyone from San 
Francisco County today ? 

The Chairman. Mr. Robinson will have to answer that. 

We will stand in recess now until 2 o'clock this afternoon. 

(Wliereupon, at 12: 30 p. m., a recess was taken until 2 p. m. of the 
same day.) 

AFTERNOON SESSION 

(Whereupon the committee met, pursuant to noon recess at 2 p. m.) 
The Chairman. The committee will be in order. We are still in 
closed session. 

(The folloAving proceedings were had in closed executive session:) 
The Chairman. Mr. Harry Sackman will be the first witness. Mr. 
Sackman, do you solemnly swear that the testimony you give this com- 
mittee will be the truth, the whole truth, and nothing but the truth, 
so help you God ? 
Mr. Sackman. I do. 

TESTIMONY OF HAREY SACKMAN, ACCOUNTANT, BEVERLY HILLS, 

CALIF. 

Mr. Halley. What is your name? 

Mr. Sackman. Harry Sackman. 

Mr. Halley. What is your address? 

Mr. Sackman. 1680 North Vine Street, Hollywood. 

Mr. Halley. What is your home address ? 

Mr. Sackman. 339 North Rexford Drive, Beverly Hills. 

Mr. Halley. Wliat is your business? 

Mr. Sackman. Public accountant and tax consultant. 

M'r. Halley. Do you represent Mickey Cohen ? 

Mr. Sackman. I have prej^ared income returns for Micky Cohen; 
yes, sir. 

Mr. Halley. Were you served with a subpena duces tecum for 
records pertaining to Mickey Cohen ? 

Mr. Sackman. I have been served with a subpena asking for records 
in my possession or under my control for the past 9 months. 

Mr. Halley. Do you have them here with you ? 

Mr. Sackman. Yes, sir. 

The Chairman. Let the record show that you brought in your 
records by virtue of a subpena of this committee, certain records that 
were asked for by subpena served upon you. 

Mr. Sackman. Yes, sir. The Mickey Cohen records I have before 
me for the past 9 months. 

Mr. Hx\LLEY. Will you state what you have and turn it over to the 
committee. 

Mr. Sackman. I have a letter from the State franchise-tax board 
dated October 13, 1950, wherein they asked for an extension of time to 
April 15, 1952, for the examination of his 1916 State income-tax 
returns. 

The Chairman. Can you identify these in a general way ? 

Mr. Halley. Identify each batch of files rather than each individual 
document. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 145 

Mr. Sackman. All right. I have here numerous memoranda phoned 
in to my office by JNIickey Cohen from persons he claims he borrowed 
money during the past year. 

Mr. Halli:y. When was that turned or phoned in to you ? 

Mr. Sackman. At various dates, the dates are on some of the 
memoranda. 

Mr, Halley. In whose handwriting is this? 

Mr. Sackman. I can identify each one, sir. On the little card on 
the back of which is the name Klishka, that appears in pencil the 
numerals $13,000. It appears to me that that is Mickey Cohen's 
handwriting. 

Mr. Halley. Did he explain that notation to you ? 

Mr. SxVCKMAN. No. He just notifies me. He tells me each time 
he borrows money from various people. He personally handed me 
this. 

Mr. Halley. What else do you have? 

Mr. Sackman. Then I have a memorandum here called in by Mickey 
Cohen on January 17, 1950, that he received $20,000 from J. W. 
Federman. 

Mr. Halley. Do you know Federman? 

Mr. Sackman. No; I do not. 

Mr. Halley. May each of these be marked as exhibits. 

The Chairman. Let's start with exhibits Nos. 4 and 5. 

Mr. Halley. The card should be marked "Exhibit No. 4," and the 
sheet of paper will be exhibit No. 5. The franchise letter is easily 
identifiable. These are miscellaneous scraps of paper, and I want 
them identified. 

The Chairman. All right, they will be so marked. 

(Exhibits Nos. 4 and 5 were returned to the witness after analysis 
by the committee.) 

Mr. Sackman. Then on January 24, 1950, he phoned in that he 
borrowed $2,500 from Bernard Cohen. 

Mr. Halley. Is that in your handwriting? 

Mr. Sackman. That is in my handwriting. He phoned that in 
to me. 

Mr. Halley. Is the Federman thing in your handwriting, too? 

Mr. Sackman. No, sir. 

Mr. Halley. Who made that notation? 

Mr. Sackman. It might have been somebody in my office, but I 
can't identify it. 

Mr. Halley. It says "M. C. called H. S." 

Mr. Sackman. That means Mickey Cohen called me. 

Mr. Halley. But somebody else made the notation ? 

Mr. Sackman. Probably my secretary was standing alongside of 
me when he called me, and she made tlie notation when he called me. 

The Chairman. It will be marked "Exhibit No. 6." 

Mr. Sackman. Then appears a notation that Mickey Cohen phoned 
to me on December 19, 1950, wherein he said he received $25,000 from 
Federman and on September 14 he won $2,380 on the horses, he 
told me. 

The Chairman. That will be marked "Exhibit No. 7." 

(Exhibits Nos. 6 and 7 were later returned to the witness.) 

Mr. Sackman. That is all of those memoranda, gentlemen. 



146 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. How did he happen to call you about these loans? 
How did that come about ? 

Mr. Sackman. For this reason : that during an investigation of his 
Federal income taxes by the Intelligence Unit he was asked to prepare 
a net worth statement. The net worth statement for the year 1947, 
if my memory serves me correctly, showed that he had expended ap- 
proximately $140,000 — $140,000 and some — that is the time he pur- 
chased his home and remodeled his home, and so forth. So I prepared 
such a statement and asked him where he got the money, because his 
income tax returns did not reflect any such amounts. 

The Chairman. For what year was that? 

Mr. Sackman. I believe that was for 1947. 

The Chairman. One hundred and forty thousand and some dollars 
■expended ? 

Mr. Sackman. One hundred and forty thousand and some dollars, 
yes, sir. So then he gave me a list of names from whom he claimed he 
borrowed a great amount of that money. 

Mr. Halley. Do you have that list ? 

Mr. Sackman. I turned that over to the Intelligence Unit of the 
Treasury Department. 

Mr. Halley. And you kept no copy? 

Mr. Sackman. No. They gave me a receipt for it at the time they 
took it. Mr. Goodykuntz of the Treasury Department has that. 

Senator Wiley. Do you have the receipt from the Treasury Depart- 
ment ? 

Mr. Sackman. I don't have it with me. 

Senator Wiley. Do you remember the name of the agent ? 

Mr. Sackman. Yes ; his name is Mr. Spears. He is on Mr. Goody- 
kuntz' staff. 

Mr. Halley. Will you go ahead, please. I understand you are going 
ahead with an explanation. 

Mr. Sackman. Yes. So, therefore, at that particular time I told 
Mr. Cohen that in the future I don't want any more guesswork from 
liim. If he borrows any money from anj^body, to phone it in to my 
office so that we have a record, some kind of record in my office, so 
when the Federal people make an investigation we can explain to the 
Federal people where we got the moneys. 

Senator Tobey. Did he give collateral for these borrowings? 

Mr. Sackman. It seems not, sir. 

Senator Tobey. Do you know whom he borrowed from ? 

Mr. Sackman. The statement that I prepared for the Intelligence 
Unit shows each and every name and the amounts. 

Senator Tobey. One hundred and forty thousand dollars was bor- 
rowed without security ? 

Mr. Sackman. I wouldn't say the $140,000 in its entirety was bor- 
rowed, but the greater part of it. 

Senator Tobey. Did he give notes for them ? 

Mr. Sackman. I don't know how he manipulates his business. I 
don't ask him about that. He comes up to my office to get a tax 
return prepared, and that is the extent of my relations with him. 

Mr. Halley. Then, in 1948, you said in the future when he bor- 
rowed money that he should do something about it ; is that right? 

Mr. Sackman. I told him that the early part of this year when I 
prepared that statement for Mr. Goodykuntz. Th.at was this year. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 147 

Mr. Hallet. I see. So then he began to give you notations when- 
ever he borrowed money ; is that right ? 

Mr. Sackman. That is right. 

Mr. Halle Y. Woiikl lie call in to you on each of those occasions? 

Mr. Sackman. Yes; those are the ones that he called in. 

Mr. Halley. For instance, in January he remembered a loan of 
2, years ago from Bernard Cohen for $2,500; is that right? 

Mr. Sackman. That is right. 

Mr. Halley. Then in January he also remembered a loan from 
Federman for $20,000? 

Mr. Sackman. Yes. 

Mr. Halley. Or is that one he made at that time? 

Mr. Sackman. That is one he told me he made at that time ; yes. 

Mr. Halley. Then in April he borrowed $13,000 from William 
Kliska; is that right? 

Mr. Sackman. Yes. He only gave me that notation — he handed 
that card to me about 3 weeks ago. He was in my office and he said 
he made a special trip to come to my office to hand me that card. 

Mr. Halley. Then in September he said he borrowed $25,000 from 
Federman and that he won $2,380 gambling; is that right? 

Mr. Sackm.vn. Yes; that is right. 

Mr. Halley. When did he give you that information ? 

Mr. Sackman. The date is on there, sir. 

Mr. Halley. September 19, 1950? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Was it after that that he brought in the card with 
the $13,000 loan from Klishka ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. In 1917 you said he borrowed a substantial part of 
$140,000? 

Mr. Sackman. That is what he claims ; yes. 

Mr. Halley. Was it in excess of $100,000 that he borrowed? 

Mr. Sackman. I would say yes, at this particular time. 

Mr. Halley. What was his income in 1947 ? 

Mr. Sackinian. I haven't the return with me, but it was never in 
excess of $30,000. 

Mr. Halley. What vras his income in 1948? 

Mr. Sackman. Not in excess of $30,000. 

Mr. Halley. Would that apply to 1949 and 1950 ? 

Mr. Sackman. 1950, the return isn't prepared as yet, but in 1949 
I have the return here. The reason I didn't bring those other returns, 
gentlemen, is because the subpena says for the past 9 months. 

Mr. Halley. The subpena was confined to papers during the past 
9 months that have been in your possession. I can see where the am- 
biguity lies as you read it. I appreciate that, but what we had in mind 
was papers which during anytime in the last 9 months were in your 
possession. It is not confined to records covering only the last 9 
months. 

Mr. Sackman. Perhaps you are correct, but to satisfy my own 
mind of this, sir, I wasn't exactly sure what you wanted; so I even 
went to Mr. Jerry Giesler, the attorney, and I showed him this and I 
asked liim his interpretation of that 9 months and he said, "Well, that 
which you have prepared for the 9 months." 



148 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. I will avoid a legal conflict with a great legal mind, 
and simply ask the chairman at this time to instruct you to produce 
every single scrap of paper which is in your possession relating to 
Mickey Cohen, and to produce it not later than 5 o'clock this afternoon. 

Mr. Sackman. I would have to go all the way back to Hollywood 
and go through the files and everything else. 

Mr. Halley. We must have that information. 

Mr. Sackman. Sir, I will be willing to give it to you. I have no 
objection to giving it to you. 

Mr. Halley. We will send somebody back with you, so you won't 
have to return. 

Mr. Sackman. That is all right then. 

The Chairman. They will give you a receipt for it. Is that all 
right? 

Mr. Sackman. Yes. 

The Chairman. I think this subpena is ambiguous, to be frank 
with you. 

Mr. Sackman. Yes ; it is. 

Mr. Halley. That will include correspondence, letters, and memo- 
randa of any type. 

Mr. Sackman. I will give you anything in my files pertaining to 
Mickey Cohen. 

Mr. Halley. Going back as many years as your file goes back on 
that. You will give us all that inf ormaton ; will you ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. When did you first begin to represent Mickey Cohen? 

Mr. Sackman. I would say, perhaps, 8 to 10 years ago, when I first 
began preparing his tax returns. 

INIr. Halley. At that time did he deliver you any records going 
back to previous years? 

Mr. Sackman. No, sir ; he did not. 

Mr. Halley. So that your records go back about 8 to 10 years ; is 
that right ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Do you have copies of the tax returns for all those 
years ? 

Mr. Sackman. That is what I am referring to. There was 1 year, 
I believe it was 1942, in which he did not file a tax return. 

Mr. Halley. May I see the 1949 tax return which you have here? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Do you know whether he was able to repay any of the 
moneys borrowed in 1947? 

Mr. Sackman. The statement which I prepared for Mr. Goodykuntz 
only showed perhaps one or tw^o repayments. 

Mr. Halley. Did he borrow any substantial sums in 1948 and 1949 ? 

Mr. Sackman. Oh, yes. 

Mr. Halley. What did they amount to ? 

Mr. Sackman. I wouldn't hazard a guess. 

Mr. Halley. Were they in excess of $50,000 each year? 

Mr. Sackman. Oh, yes. 

Mr. Halley. Here we have a man who in 1947 borrowed approxi- 
mately $100,000 ; in 1950, so far, we have $60,000 that he borrowed so 
far. You say he has borrowed substantial sums in excess of $50,000 
in each of the previous years ; is that right? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 149 

Mr. Sackman. I am quite certain ; yes. 

Mr. Halley. His income for IDJzO shows a gross of $14,845 ; is that 
correct ? 

Mr. Sackman. Yes. 

Mr. Haijjey. Phis $25 in interest, making a total of $14,870.60. 

Mr. Sackmax. Tliat is substantially correct; it is right on the face 
of the return. 

Mr. Halley. It is income received primarily in the form of "various 
commissions," $10,000. Is that an estimated amount ? 

Mr. Sackman. That is the amount that he submitted to me. 

Mr. Halley. Do you have any detail on that ? 

Mr. Sackman. No, sir. 

Mr. Halley. Do you get away with that sort of thing with your 
income-tax returns ? 

Mr. Sackman. Do I get away with it ? 

Mr. Halley. When you file a return saying "various commissions, 
$10,000,^' do you get away with that ? 

Mr. Sackjian. I always ask him each year to give me the detail on 
it. I tell him the law. He says, "Well, here is the figure and this is 
the only thing I can present to you." Therefore, on that basis I file 
the return with the Government. Whether they accept it or not, that 
is up to them. I am not trying to get away with anything. 

Mr. Halley. What does the Bureau of Internal Revenue say each 
year when they see it that way ? 

Mr. Sackmax, They haven't said anything until about, oh, I would 
say about a year ago, when they started investigating him. Their 
investigation is still under way. 

Mr. Halley. Do you think they are going to accept that form of 
return ? 

Mr. Sackiman. I don't know what they might do, sir. 

Mr. Halley. You have advised Mr. Cohen that generally that 
type of statement is not acceptable ? 

Mr. Sackjman. Each and every year I tell him the same thing. 

Mr. Halley. That it is not acceptable ? 

Mr. Sackman. That is right. 

Mr. Halley. Yet he has never been assessed ; has he been ? 

Mr. Sackmax. He has not brought me any more detail, sir. 

Mr. Halley. The Bureau has never assessed him ? 

Mr. Sackmax. Never assessed anything; no. 

Mr. Halley. Who is Cohen and Pignola ? 

Mr. Sackmax. There is attached to that return, sir, a copy of a 
partnership return. That would seem to be a tailor shop; a part- 
nership. 

Mr. Halley. He is a partner of Al Pignola ? 

Mr. Sackmax. Yes, sir. 

Mr. Halley. His share of the profits was $4,845.60 ? 

Mr. Sackmax. That is what the partnership return reflects. 

Mr. Halley. Did you prepare the partnership return ? 

Mr. Sackmax. I did not. 

Mr. Halley. Who prepared that, if you know ? 

Mr. Sackmax. Mr. Cohen had an accountant to take care of his 
books and records. I believe the name was Steiner. 

Mr, Halley. Who is Jimmy Steiner? 



150 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sackman. That is the accountant, I believe, that prepared 
that return. 

Mr. Halley. Did he handle other matters for Cohen or just that? 

Mr. Sackman. I don't know what his relationship there was, sir, 
but I never did see any of Cohen's records or books. 

Mr. Halley. I see here a pencil notation in blue pencil dated March 
8, 1950, "Add $25 interest on Continental, phoned in by James 
Steiner." 

Mr. Sackman. He phoned that in to my office. 

Mr. Halley. Did he, on other occasions, give you information 
about Cohen's finances ? 

Mr. Sackman. The only occasion he gave me something was when 
the Intelligence Unit started an investigation of Cohen's income-tax 
returns. I asked Cohen who was his accountant. He told me "that 
man Steiner." So I called Steiner and told him that Cohen wanted 
me to represent him before the Treasury Department in income-tax 
matters. I made an appointment with Steiner and several of the In- 
telligence Unit agents to come to Cohen's office or place of business^ 
That is where I first met Steiner at that particular time. 

Mr. Halley. Do you see Mr. Steiner from time to time ? 

Mr. Sackman. I have only seen him once since that time, and I 
saw him this morning in the hall. 

Mr. Halley. He is here now ? 

Mr. Sackman. Sir? 

Mr. Halley. He is here today? 

Mr. Sackman. He was here ; I don't know if he is here now. 

Mr. Halley. Who is William Klishka ? 

Mr. Sackman. I don't know who he is. 

Mr. Halley. Do you know who J. W. Federman is ? 

Mr. Sackman. It seems that James or J. W. Federman was the 
auctioneer that sold out Cohen's place, his haberdashery. 

Mr. Halley. That man has loaned Cohen this year $45,000 ; is that 
right? 

Mr. Sackman. According to what was phoned to me, sir. 

Mr. Halley. You were not shown any documents ? 

Mr. Sackman. No, sir ; I was not. 

Mr. Halley. What other documents do you have here with you ? 

Mr. Sackman. The only other thing I have here, at this particular 
time, is a leter which I wrote to the office of the Intelligence Unit, 
sending Mr. Goodykuntz certified copies of Mr. Cohen's 1940 and 1941 
income-tax returns ; certified copies. 

Mr. Halley. Wliat are all those envelopes you have with you there ? 

Mr. Sackman. These pertain to other individuals named in this 
subpena. 

Mr. Halley. There is nothing else here for Cohen ? 

Mr. Sackman. Not for the 9-month period. That is what I inter- 
preted the subpena as. I do have in my office other things back of the 
9 months. 

Mr. Halley. What do you have in your office ? 

Mr. Sackman. I have copies of income-tax returns ; I have a copy 
of that statement, that net worth statement, which was prepared for 
Mr. Goodykuntz of the Intelligence Unit. That will reflect all of the 
names and amounts of moneys that Cohen borrowed during a 4-year 
period. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 151 

Mr. Halley. You do have that in your office ? 

Mr. Sackman. I will give you everything in my files. 
Senator Tobey. What was his net worth in that statement, if you 
know ? 

Mr. SAcjiMAN. It was so far in the red that it was pitiful, because 
he borrowed all this money. 

Senator Tobey. Did he borrow money to pay off loans? 

Mr. Sackman. It seems that he borrowed the moneys, the greater 
part of the moneys, in 1947, to buy the house that he lives in, plus 
furniture and renovations. That is the way it seems to me. Of 
course, that statement — may I call your attention to the fact also that 
that statement will reflect his disposition of the moneys ; that is, each 
year just how much jewelry he bought for his wife or himself, how 
much his living expenses were and how much clothing was bought. 
Also automobiles or furs or anything else. That statement will reflect 
all of that in each particular year. 

Mr. Halley. Why do you people loan Cohen such large sums of 
money? Let me reframe the question. Why do people loan Cohen 
such large sums of money ? 

Mr. Sackman. I couldn't tell, sir; I never associated with him or 
any of these people he borrowed money from. 

Mr. Halley. Are you reasonably certain that these documents were 
written on the dates that they bear? 

Mr. Sackman. They were phoned in to me. 

Mr. Halley. This first note, "J. W. Federman, $20,000," is it your 
sworn testimony that that was written on January 17, 1950 ; the date 
it bears ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Do you have anybody who could corroborate your 
testimony in that respect ? 

Mr. Sackman. On that particular document I am quite certain that 
is the handwriting of my secretary. She may have been sitting at my 
desk at that particular time. She probably heard me talk to him and 
wrote it right down while I was talking to him. 

Mr. Halley. Whose handwriting is the one in that shows a loan 
from Federman saying "Phoned $25,000 Federman" ? 

Mr. Sackman. That is my handwriting. 

Mr. Halley. Did you know that Federman died 3 weeks ago ? 

Mr. Sackman. No, I didn't ; I didn't even know the man. I never 
saw him. 

Mr. Halley. "You had never been told that he died? 

]Mr. Sackman. No. 

The Chairman. Before you leave this, this letter of April 7, 1950, 
to Mr. Goodykuntz of the Intelligence Unit, it states that you are send- 
ing in a certified copy of Cohen's returns for 1940 and '41. It says 
that insofar as the calendar year of 1942 is concerned that your files 
disclose no knowledge of taxpayer having filed a return for that year. 
Is that still the situation? 

Mr. Sack3ian. That is still the situation. 

The Chairman. I do not think we particularly need this letter in 
the record. 

Mr. Halley. No. 

The Chairman. We will give you this letter back. 



152 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sackman. Thank you. 

Mr. Halley. When did the income-tax investigation of Mickey 
Cohen begin? 

Mr. Sackman. When did it begin ? 

Mr. Halley. Yes. 

Mr. Sackman. I would say that it began prior to the first of this 
year. 

Mr. Halley. During 1949, was it in progress ? 

Mr. Sackman. The latter part of 1949. 

Mr. Halley. During that time you represented him; is that right? 

Mr. Sackman. Yes; that is right. 

Mr. Halley. Do you know Donald Burcher ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Was he at that time on the staff of the Bureau of 
Internal Revenue ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. Was he one of the men who was investigating Mickey 
Cohen ? 

Mr. Sackman. No, sir ; not to my knowledge. 

Mr. Halley. Was he conversant with the details of the Cohen 
investigation ? 

Mr. Sackman. When he was in the Bureau, you mean ? 

INIr. Halley. Yes. 

Mr. Sackman. Not to my knowledge. 

Mr. Halley. What division of the Bureau was investigating Mickey 
Cohen ? 

Mr. Sackman. The Intelligence Unit. 

Mr. Halley. Was Donald Burcher an agent of the Intelligence 
Unit? 

Mr. Sackman. He was ; yes, sir. 

Mr. Halley. Did Burcher leave the Intelligence Unit in September 
of 1950? 

Mr. Sackman. Yes, sir; he did. 

Mr. Halley. Did he thereafter become associated with you ? 

Mr. Sackman. He did ; yes, sir. 

Mr. Halley. How soon after he left the Bureau of Internal Revenue 
in September of 1950 did Burcher become associated with you? 

Mr. Sackman. He became associated with me as of September 1950. 

Mr. Halley. What was the nature of the association ? 

Mr. Sackman. It was a partnership, on a 60^0 basis. I was to 
get 60 percent and he was to get 40 percent. 

Mr. Halley. Of all fees ; a general partnership ? 

Mr. Sackman. We didn't have partnership papers drawn yet, but 
it was supposed to be 60 percent to me, 40 percent to him, until he had 
$30,000 worth of income, and then it was to be 50-50. 

Mr. Halley. Did you discuss with Burclier the question of his be- 
coming associated with you before he left the Bureau ? 

Mr. Sackman. May I tell you how it happened ? 

Mr. Halley. Would you just go ahead? Perhaps you would like to 
start at the beginning, as they say, and tell the committee the whole 
story. 

The Chairman. Let's get Mr. Burcher's full name. 

Mr. Robinson. Donald O. Burcher, B-u-r-c-h-e-r. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 153 

Mr. Sackman. I had anotlier matter pending in the Intelligence 
Unit, which v/as in Mr. Burcher's group. This was about the early- 
part of August of this year. Mr. Burcher told me that he attained 
an age of 50 years and that he had been in the Government service for 
28 years, and that he was going to resign from the Intelligence Unit 
and go into business for himself. 

Mr. Halley. He had been engaged in some business during the time 
that he was in the Intelligence Unit ; had he not been ? 

^Iv. Sackman. At that particular time I didn't know it. 

Mr. Halley. You do know it now ? 

Mr. Sackman. He told me after he was associated with me. 

Mr. Halley. In any event, you had these discussions prior to Sep- 
tember of 1950 ? 

]\[r. Sackman. Yes. 

Mr. Halley. Starting when ? 

Mr. Sackman. Well, it was about the first or second week in August. 

Mr. Halley. Had you at that time been to Mr. Burcher's home? 

Mr. Sackman. I was never to Mr. Burcher's home. 

Mr. Halley. You still have never been there ? 

Mr. Sackman. Still have never been there. 

Mr. Halley. Go ahead. 

Mr. Sackman. Then when I came into his office the second time, 
about the middle of August, he said he had spoken to his wife and 
he had definitely made up his mind that he was going to resign from 
the service and go into business as a tax consultant. So at that partic- 
ular time I said to him, "Donald, if you are going into business as 
a tax consultant," I said, "don't you think it might be a good idea 
if we joined forces ?" He said, "Harry, I think it would be splendid." 
He said, "I will talk to my wife," He said, "In fact, I am going 
away on a vacation, but still I will give you an answer before I go 
away." So he called me up one day and he said, "I spoke to my wife 
and my wife is satisfied that I resign and then I go into business as 
tax consultant and I would like to talk to you about joining forces 
with you." I said, "Very well." 

So he came to my office. We spoke about it. We drew a tentative 
agreement. He went on his vacation. He came back from his vaca- 
tion and he showed me a copy of a letter that he had sent to Mr. Wolf, 
who was the head of the Intelligence Unit in Washington, advising 
Mr. Wolf that he is resigning to go into business for himself, and he 
also shovv-ed me a copy of a letter that Mr. Wolf had sent back to 
him, wishing him all the luck in the world and that he had served 
the Government faithfully and honestly and it was quite a letter 
of commendation. 

INIr. Halley. Did you have any discussion concerning his business 
prospects, his ability to find clients? 

Mr. Sackman. Yes; I did. He said he was well acquainted with 
quite a number of attorneys throughout the city here, throughout 
this area, and that he felt that he could bring in a substantial amount 
of business. 

Mr. Halley. Did he have any retainers lined up before he came to 
you ? 

Mr. Sackman. No, sir. 

!Mi'. Halley. What was your income from your accounting business 
last year? 

68958— 51— pt. 10 11 



154 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sackman. For the year 1949 ? 

Mr. Halley. Yes. 

Mr. Sackman. I believe it was somewliere around $40,000. It 
wasn't just from the accountinG; business; tax and accounting. 

The Chairman. Is that net ? 

Mr. Sackman, Gross. 

The Chairman. Office expenses come out of that; is that right? 

Mr. Sackman. Yes. 

Mr. Halley. What was the net ? 

Mr. Sackman. Around $20,000, 1 think ; something like that. 

Mr. Halley. For the year 1948, what was your gross and your 
net income ? 

Mr. Sackman. Around $30,000 gross and, perhaps, around $12,000 
or $15,000 net. 

Mr. Halley. Under those circumstances, what was the basis upon 
which you justified to yourself assuring 40 percent of your income to 
a man who was about to resign from the Bureau of Internal Revenue 
and who had no assurance of any business whatsoever? 

Mr. Sackman. The basis was this, sir: I am past 69 years old. I 
practically, you might say, figured that I was buying insurance. That 
is, when a man gets to that age bracket, he nevers knows whether he 
is going to get sick or otherwise. I figured if I Avould get sick I 
would still have my share of the business and otherwise the business 
is built around me, so if I were to get sick I might as well close up 
shop. Therefore, if I had a man who knew the tax business, he could 
carry on and I would still get my share of the business. 

Mr. Halley. Burcher had been in the Bureau of Internal Revenue 
for over 20 years ; is that right ? 

Mr. Sackman. That is what he told me. 

Mr. Halley. Their salaries are very low, are they not ? 

Mr. Sackman. He told me he hacl grade 13. I think that carrier 
around $8,000 or $9,000 salary. 

Mr. Halley. How much is that again ? 

Mr. Sackman. I think that carries a $8,000 or $9,000 salary. 

JNIr. Halley. He was a very wealthy man, though ; was he not ? 

Mr. Sackman. I never inquired. I don't know just as to his financial 
status. 

Mr. Halley. Do you have any knowledge of the facts concerning 
his real-estate ownings ? 

Mr. Sackman. No. The only thing he told me was that he owned 
his home ; that he had a place in Big Bear ; and, I believe, he told me 
tliat he had another house some place around Balboa or Newport^ 
somewhere around there. He just told me that in general conversa- 
tion. 

Mr. Halley. You do not know that he had very substantial means ? 

Mr. Sackman. I don't know, sir. 

Mr. Halley. What other documents did you bring, Mr. Sackman? 

]Mr. Sackman. This subpena asked me to bring books and records,, 
ledgers, balance sheets, and so forth, for Phil Tapper, Irving Glasser — 
may I stop there? I had quite a number, a large quantity of records, 
for Irving Glasser, and some in which Phil Tapper, Irving Glasser, 
and several others — Jimmie Utley — and others were in the same busi- 
ness. So Irving Glasser yesterday afternoon, he came to my office and 
he said, "These are my records." I said, "They are your records ?" He 



ORGANIZED CRIME IN INTERSTATE COMMERCE 155 

said, "I have a subpena for them." So he had a big corrugated box — ■ 
it must weigh probably 200 pounds or more — with all of those records 
in it. 

Mr. Halley. You are referring now to records of Irving Glasser? 
Mv. Sackman. They are the records of some of the ventures that 
Glasser, Utley, and Tapper were concerned in. 

Mr. Halley. What ventures did Glasser, Utley, and Tapper have 
together ? 

Mr. Sackman. Well, there were some bingo parlors in Ocean Park. 
One of them was called the Surf ; another one they called the Lodge ; 
another one they called the Rose ; another one they called the Fortune. 
Then they was one in Stockton that they called the Lodge also. 

]\Ir. Halley. Are those bingo games legitimate? 

Mr. Sackman, It seems that tlie ones out in Ocean Park — it seems 
that the police commission issued a permit for their operation ; whether 
the one in Stockton was legitimate or not, I don't know. 

]SIr. Halley. What other ventures were they in together? 

The Chairman. Wliere is Ocean Park? 

Mr. Sackman. That is out at the beach. 

The Chairman. Is that in Los Angeles County ? 

Mr. Sackman. In Los Angeles City and County. It is the amuse- 
ment park out at the beach there. 

Mr. Halley. Let the record show that the chief of police, Mr. 
Parker, states they are not legitimate. 

Chief Parker. The operations were under a police commission per- 
mit, but our investigation of the actual operation convinced us that 
it was not a legitimate operation because they were going far beyond 
the permit. Those places have all been closed. Their permits were 
suspended and later they were withdrawn. They haven't operated 
now for a year. We believe it to be a lottery. 

The Chairman. All right. 

Mr. Halley. Go ahead ; what else ? 

Mr. Sackman. Then there was one place up around San Francisco 
that they also had or were interested in — a bingo parlor. 

Mr. Robinson. In San Mateo County. 

Mr. Sackman. I wouldn't know which county it is. 

Mr. Robinson. Let the record show that it was in San Mateo County. 

Mr. Halley. Let's just go ahead. What other ventures did they 
have? 

Mr. Sackman. Then there was a corporation known as the Flower 
Inn, of which I have the corporate records here. It was a hotel down 
at Del Mar. 

Mr. Halley. Did it have gambling ? 

Mr. Sackman. That I wouldn't know, sir. 

Mr. Halley. Do the records show whether it did or not ? 

Mr. Sackman. The records show no gambling. 

Mr. Halley. What other ventures did they have ? 

Mr. Sackman. That is all I know of, that those individuals were in 
together. 

Mr. Halley, What other records do you have here? Do you have 
an envelope for the Mickey Cohen records ? 

Mr. Sackman. Yes. 

Mr. Halley. Why don't we keep those records in the envelope to 
preserve them ? 



156 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Sackman, xVll right. 

Mr. Hall^y. When we are ready to return them, we will return 
them intact. What is the next envelope you have ? 

Mr. Sackman. The next envelope I have has a number of partner- 
ship returns in it of which all of these people were associated in 
ventures. 

Mr. Halley. May I see that ? 

Mr. Sackman. Yes, sir. 

Mr. Halley. What were the ventures and who are the people you 
refer to ? 

Mr. Sackman. Tapper, Glasser, and Utley. 

Mr. Halley. Take the first partnership return here of Miller, Le 
Bow 

Mr. Sackman. That has nothing to do with those individuals. 
That has to do with Miller. 

Mr. Halley. That is a bookmaking establislmient, is it not'^ 

Mr. Sackman. I don't know what their business is. 

Mr. Halley. It is called "dba Western Commissioners. Business 
or profession : Commission men." 

Mr. Sackman. I was never in any of these places of business. 

Mr. Halley. Well, what do you think it was ; let's not beat around 
the bush. 

Mr. Sackman. I am not going to beat around the bush. 

Mr. Halley. What do you think it was^ You filed a return here 
with no detail at all. 

Mr. Sackman. Yes ; there is some expense detail. 

Mr. Halley. $2,250,136 paid to customers ; what could that possibly 
mean but boolanaking ? 

Mr. Sackman. It may not have been bookmaking ; maybe they had 
baseball pools or football pools. 

Mr. Halley. But it would be betting of some kind ? 

Mr. Sackman. That is right. 

Mr. Halley. It had to be ; isn't that correct ? 

Mr. Sackman. Yes. 

The Chairman. Let's identify this file. 

Mr. Halley. We are working now on the file of Miller-Le Bow- 
Shapiro and others. This is a file of all partnership returns, that is 
the first one for Miller-Le Bow-Shapiro-Boss and Rubin. Then we 
have a 1949 for Bridge Amusements. What is that ? 

Mr. Sackman. That is the bingo game. That was the one in San 
Francisco, I believe. That is the one for San Francisco ; yes. 

Mr. Halley. Then we have here Rose Bridgo, of Venice, Calif. 

Mr. Sackman. I mentioned that to you before. 

Mr. Halley. Is that the one that you do not think is legal ? 

Chief Parker. It is one of 11 that were operated in the city of Los 
Angeles. 

Mr. Halley. Was the lodge in Venice, was that a skill game ? 

Mr. Sackman. It was all the same thing. 

Chief Parker. Yes ; they are all the same thing. 

Mr. Halley. Is it bingo i 

Mr. Sackman. Yes. 

Mr. PIalley. The partners here are Tapper, Owens, Kleiger, and 
Glasser. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 157 

Mr. Sackman. '^^'^licll one is tliat ? 

Mr. Halley. The Lodge. 

Mv. Sackman. Here are all of the partners. Here is a list of them, 
probably 20 of them. 

Mr. Halley. Thank you. Then we have another Bingo Palace, in 
Stockton, Calif., that you have told us about, and various other part- 
nership returns in these files. Now, I notice again this is limited to 
1949. 

Mr. Sackman. Yes; it is limited to the 9-month period. We all 
agreed this was ambiguous. I am willing to produce anything I have. 

Mr. Halley. I tend to believe there may be an ambiguity in that 
subpena and I am not in any way stating that you are at fault for not 
bringing the material, although it might have been simple to call Mr. 
Kobinson rather than see an attorney. 

Mr. Sackman. I didn't see the attorney especially for that. We 
talked on the phone about various matters. 

Mr. Halley. We are going to need all your records on all of these 
people. I will ask the chairman to direct you to give them to the 
committee. 

The Chairman. AVTiat are these other records you have ? 

IVIr. Halley. May we have the direction for the record, Senator ? 

The Chairman. How many years have you been keeping the records ? 

Mr. Sackman. Well, sir, take for instance this Cohen, for 8 or 10 
years back. Utley, for probably the last 3 or 4 years that I prepared 
his income-tax returns. Glasser, I have prepared his income-tax 
return for probably 8 to 10 years. 

The Chairman. Supposing we leave it this way : You will produce 
what you have and we will send someone with you to go over the 
records with you. If there is something our man feels is not relevant 
or necessary then he will not bring it back with him. 

Mr. Sackman. I am willing to cooperate. 

Mr. Halley. "Wliat is the next envelope you have ? 

Mr. Sackman. The next envelope is the 9-month period for Hymie 
Miller. I have got it marked "Hymie M." 

Mr. Halley. He is a bookmaker who has been arrested; is that 
right? 

Mr. Sackman, I know he has been arrested. 

Mr, Halley. He is under arrest for bookmaking; isn't that correct? 

Mr. Sackman. I can't say. 

The Chairman. Is that identified? 

Mr, Halley. Yes. What have you next? 

Mr, Sackman, Here is the 9-month record for Irving Glasser. 

Mr. Halley. Next? 

Mr, Sackman. These are payroll returns for this 9-month period 
for these various ventures that I have spoken to you about. 

Mr. Halley. You mean the various partnerships, the bingo games 
and such? 

Mr. Sackman. Yes, sir. Here is the 9-month record for Phil Tap- 
per. Here is the 9-month record for Jimmie Utley. 

JNIr. Halley, I would like to hold off here on Utley. What business 
is Utley in ? 

Mr. Sackman. I really don't know; he also comes in. He doesn't 
give me much detail. I just prepare returns from the information 
submitted to me. I have never been in his business. 



158 ORGAJSriZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. You have never been at his place of business ? 

Mr. Sackman. See, I am not their accountant. I just prepare their 
tax returns. I never see their books. 

Mr. Halley. You are a tax consultant ; is that right? 

Mr. Sackman. Yes. 

Mr. Halley. All right ; we have Utley here. What is the next one? 

Mr. Sacioian. There may be some of the books on one or two of 
these bingo parlors that were kept in my office by one of my assistants. 

Mr. Halley. Which did you keep in your office ? 

Mr. Sackman. I believe it was the books for the Fortune — no, I 
believe it was the books for the Surf and the Lodge, I believe it was. 
Now, here is an envelope for Edward G. Nealis. 

Mr. Halley. What is the next one you have ? 

Mr. Sackman. May I call your attention to this, gentlemen, that 
there are several names on here, on the subpena, that I know nothing 
of. For instance, you have on this subpena Barney Ruditsky. The 
first time I ever saw the man was about an hour ago. I was introduced 
to him outside. I never did any work for him. 

Mr. Halley. Who introduced you ? 

Mr. Sackman. Hymie Miller. I don't think I ever saw him in 
my life before or knew who he was. Then you have on this subpena 
Associated Security Council. I don't know who they are. You 
also have on this subpena Samuel Boss. The only thing I know about 
Samuel Boss is he was one of the partners in the Western Commis- 
sioners with Hymie Miller. The same thing for Michael Shapiro; 
I never did any personal work for him. Benjamin Teitelbaum; I 
have done no work for him and have no knowledge of what his activi- 
ties were so I have nothing on him. I wanted to call your attention 
to that. 

Mr. Halley. I notice that you do have some other records with you. 

Mr. Sackman. Yes. 

Mr. Halley. What are they ? 

Mr. Sackman. This all pertains to the corporation of the Flower 
Inn that was prepared by another accountant and sent up to my office 
last March. 

Mr. Halley. You are referring to the Flower Inn ? 

Mr. Sackman. Yes. Inasmuch as the records were in my office, you 
asked for the 9-month period, so I brought them along with me. 

Mr. Halley. That is the same Glasser and Utley group; is that 
right? 

Mr. Sackman. That is right ; yes. 

Mr. Halley. What else do you have ? 

The Chairman. Do you want these? 

Mr. Halley. I would like to take a look at them, sir. 

Mr. Sackman. May I call your attention to some of these, gentle- 
men ; may I have them back before the first of the year ? 

The Chairman. We will get them back to you before then. 

Mr. Sackman. Let me see what I have here. These are some records 
of the lodge, the bingo parlor out at the beach, after they were 
closed by the authorities. They still had some expenses going on. 
This is the record after they were closed for the expenses still going 
on. They still paid rent and had some telephone bills, and so forth. 
These are records and work sheets, the accountant's work sheets, and 
so forth, for the lodge up there in Stockton. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 159 

Mr. Halley. Thank you. 

Mr. Sackman. That is the extent of it. 

Mr. Halley. When did you first meet Mickey Cohen ? 

Mr. Sackman. Oh, about 10 years ago. 

Mr. Halley. Who introduced you ? 

Mr. Sackman. I can't recollect at this time who introduced me, 
but he came up to my office and asked to have a tax return prepared. 
I think the first return I prepared for him was for the year 1940. 
Sometimes these fellows come up to my office without an introduction 
and they want a tax return prepared. They sit down and give me 
the information. After I give them the third degree, so to speak, 
and trj^ to throw the book at them and tell them what is required 
under the tax laws, and so forth, then whatever information they 
submit to me, from that I prepare a tax return. 

Mr. Halley. How long have you known Jimmie Utley ? 

Mr. Sackman. I have Imown Utley for approximately 10 years, 
but only started preparing his returns for about the past 2 or 3 or 4 
years, perhaps. 

Mr. Halley. Who introduced you to Utley ? 

Mr. Sackman. I met Utley, oh, quite a number of years ago at a 
night club that used to be on Beverly Boulevard and Orange Grove. 
They called it the Century Club. It isn't there anymore. 

Mr. Halley. Who introduced you ? 

INIr. Sackman. I was the accountant for that club and the man who 
owned it introduced me. 

Mr. Halley. Who was that ? 

Mr. Sackman. His name was Mel Walters. 

Mr. Halley. Who introduced you to Glasser ? 

Mr. Sackman. I met Glasser about 10 or 12 years ago. I think it 
was at the Clover Club. I am not quite certain, or it may have been at 
the Century Club, either one of those two clubs. I met him there at 
that particular time. 

Mr. Halley. Who introduced you? 

Mr. Sackman. It may have been Eddie Nealis. 

Mr. Halley. Have you ever been in Mickey Cohen's home ? 

Mr. Sackman. I was in Mickey Cohen's home once with a revenue 
agent. The revenue agent called Mickey Cohen to have a talk with 
him about a year and a half ago, and Mickey told me the revenue agent 
was coming up there and I asked the revenue agent if it would be 
satisfactory for me to sit in. The revenue agent said, "Yes," and the 
revenue agent and myself, we met outside of Mickey's home, and we 
walked in together. Tliat is the only time I was ever in his home. 

Mr. Halley. Now, Mr. Robinson would like to ask you some ques- 
tions about your indictment in connection with the Guarantee Finance 
Co. 

Mr. Sackman. All right. 

Mr. Robinson. You are familiar with the Guarantee Finance Co.? 

Mr. Sackman. I only prepared one corporation tax return for them, 
a tentative report for the Guarantee Finance Co. 

Mr. Robinson. What business were they in ? 

Mr. Sackman. The Guarantee Finance Co. ? 

Mr. Robinson. That is right. 

Mr. Sackman. Well, as I say, I didn't do their tax work. They 
came to me ; there were four individuals who came to me last March 



160 ORGA]S[IZED CRIME IN INTERSTATE COMMERCE 

and told me that the books and records of the Guarantee Finance Co. 
were seized by law-enforcement agencies. They asked me what to 
do about filing a corporation income-tax return. I told them, well, 
that they had better file some type of a return. They asked me if I 
would prepare that. It was only a matter of putting two or three 
figures on a corporation return. We filed a tentative return. That is 
all I did for the Guarantee Finance Co. 

Mr. Robinson. Did you testify at a hearing before the public utili- 
ties commission that they were in the commission business? 

Mr. Sackman". The Guarantee Finance Co. ? 

Mr. Robinson. Yes. 

Mr. Sackman. 'Wliat I had reference to was the four individuals, the 
collection agency, sir. 

Mr. Robinson. Do you remember the occasion when the corporation 
commissioner moved in on the premises of the Guarantee Finance Co. ? 

Mr. Sackman. I do ; yes. 

Mr. Robinson. Did you put in your appearance up there that day ? 

Mr. Sackman. They called me at my office and asked me to come 
out ; yes. 

Mr. Robinson. Did you have a conversation with Mr. Birchfield of 
the corporation commissioner's office ? 

Mr. Sackman. No. The onlj- conversation that I can recollect I had 
with Mr. Pierce. 

Mr. Robinson. Did you tell ^Mr. Pierce at that time that you had been 
after Mr. Kobey to separate the loan and the other business before 
he got into trouble ? 

Mr. Sackman. Say that again, please. 

Mr. Robinson. In your conversation with Mr. Pierce, didn't you 
say that you had been urging upon ]\Ir. Kobey a separation of the loan 
business, as distinguished from the other activities conducted there? 

Mr. Sackman. 1 wouldn't say that I made that statement. Now, 
pardon me, let me get the story straight. Pierce told me that they were 
conducting a bookmaking business there. I said to Pierce if they 
were conducting a bookmaking business that they were just darn fools. 
They should have never brought the bookmaking business into a 
finance corporation office. 

Mr. Robinson. In connection with the Guarantee Finance tax mat- 
ter, did you make a trip back to Washington? 

Mr. Sackman. Not in connection with the Guarantee Finance tax 
business ; no, sir. 

Mr. Robinson. You went back to Washington shortly after the tax 
matter came to a head ? 

Mr. Sackman. I went back to Washington ; yes, sir. 

Mr. Robinson. Who did you contact in Washington ? 

Mr. Sackman. There was a Mr. Teddy Hayes ; he was in the public- 
relations business in the National Press Building. I did not contact 
him relative to tax matters. 

Mr. Robinson. Did you stay in New York prior to your going to 
Washington ? 

Mr. Sackman. No; I think I went to New York after I went to 
Washington. 

Mr. Robinson. Wliile you were in New York, did you call Mr. Joe 
Stacher of New Jersey ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 161 

Mr. Sackman. I think I did. 
Mr. Robinson. Who is Mr. Joe Stacher ? 
Mr. Sackman. He was a party I met out here. 
Mr. Robinson. Can you further identify him? 

Mr, Sackman. He came up to my office. I met him out here. He 
was introduced to me by Mr. Nealis and he said, "Anytime you are 
in the East give me a ring and we will spend a night together ;" which 
I did. 

Mr. Robinson. Did Mr. Nealis have any connection with the In- 
ternational Sweepstakes conducted in Mexico ? 

Mr. Sackman. That was such a messed-up affair that I couldn't 
state positively whether or not he did. 

Mr. Robinson. Did Mr. Teddy Hayes have any connection with 
it? 

Mr. Sackman. JNot to my knowledge. Mr. Hayes was in charge 
of an advertising agency there. Mr. Nealis told me that he was there 
to produce pictures. He had a Mexican corporation. 

Senator Tobey. You say you met Stacher one night and then he 
asked you to spend a night with him ? 

Mr. Sackman. Yes. 

Senator Tobet. How long had you known him when he asked you 
to spend the night with him ? 

Mr. Sackman. He didn't ask me to spend the night with him; he 
asked me to spend an evening with him if I was in New York. 

Senator Tobey. How long did you know him when he asked you 
that? 

Mr. Sackman. The second time. 

Senator Tobey. What is his business ? 

Mr. Sackman. I don't know. 

Senator Tobey. What did he come to see you about in your office? 

Mr. Sackman. He didn't come to see me about anything in my 
office. He walked in with Mr. Nealis. 

Senator Tobey. That is all you knew about him ? 

Mr. Sackman. Yes, sir. I never knew or heard of the man be- 
fore that. 

Senator Tobey. Have you seen him since then ? Did you spend an 
evening with him ? 

IMr. Sackman. Yes. 

Senator Tobey. Have you seen him since then ? 

Mr. Sackman. Yes, I have. 

Senator Tobey. Where did you see him ? 

Mr. Sackman. During a Labor Day holiday. I have a client who 
has a home at Lake Tahoe, and we happened to drive into Reno from 
Lake Tahoe and we stopped off at the Golden Hotel. My wife was 
with me and my client's wife was with him. We stopped off at the 
Golden Hotel at Reno and I ran into Joe Stacher. 

Senator Tobey. Have you seen him since then ? 

Mr. Sackman. No. 

Senator Tobey. Is he a straight and honest man ? 

Mr. Sackman. I don't know. 

Senator Tobey. What did you think of him ? Did he seem like a 
crook to you or an honest man ? 

Mr. Sackman. I didn't have any business dealings with him. 



162 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobey. Did he look like a crook or a straight-shooter? Did 
you spend two or three evenings with him? You did spend two or 
three evenings with him, did you not? How did you size him up? 

Mr. Sackman. He is a good talker and he sounded to me like a good 
businessman. 

Senator Tobey. "When you went to Washington did you go on some 
tax matters ? 

Mr. Sackman. No ; when I went to Washington I went to see Mr. 
Hayes. I stopped off in Washington and I went on another matter. 

Senator Tobey. Have you ever been to the Internal Revenue De- 
partment in Washington at any time ? 

Mr. Sackman. No. 

Senator Tobey. Do you know any of the officials there? 

Mr. Sackman. No. 

Senator Tobey. Do you know a man named Gruenwald? 

Mr. Sackman. I do not. 

Mr. Halley. On w^hat matter did you go to see Mr. Hayes? 

Mr. Sackman. Mr. Hayes was in the public-relations business and 
he had the exclusive right, shall we call it, on a Louis B. Mayer 
ranch. Louis B. Mayer wanted to sell his ranch. Mr. Hays wanted 
to know if I knew anybody that had enough money to buy the Louis 
B. Mayer ranch. Mr. Hayes was dealing w^ith some people, I think, in 
Connecticut also, that he had a lot of surplus trucks, jeeps and what 
not, of that description. He was representing these people in Con- 
necticut. He wanted me to be his western representative to sell that 
surplus property out here. Then here was another party that had 
sort of an island outside of Washington on the Potomac River and 
he wanted to built sort of a Riviera there and he asked me if I could 
get people to finance it ; western people to finance that. 

Senator Tobey. What is the name of that person ? 

Mr. Sackman. The person that had this ? 

Senator Tobey. Yes. 

Mr. Sackman. I can't recollect it at the moment. 

Mr. Robinson. Was it Colonel Bradley ? 

Mr. Sackman. No ; I can't recollect it at the moment. Then there 
w^as some big real-estate outfit here that had written Mr. Hayes 
to see if Mr. Hayes could get the Government to hire offices and build 
buildings out here. Mr. Hayes turned that letter over to me. So, 
therefore, Mr. Hayes made me his western representative. 

Senator Tobey. What is his first name ? 

Mr. Sackman. Teddy. 

Mr. Halley. Now, in Reno, did you ever know of the gambling 
establishment run by Graham and MacKay ? 

Mr. Sackman. I have known of it ; yes. I never did any work for 
them, though. 

Mr. Halley. Did you know whether or not Joe Stacher had bought 
an interest in that establishment? 

Mr. Sackman. Not to my personal knowledge; it was just hearsay. 

Mr. Halley. How did you apply that hearsay ? 

Mr. Sackman. When I M^as up there in Reno that evening, when 
we stopped off, and I ran into him in the Golden Hotel. 

Mr. Halley. Stacher told you he had acquired it? 

Mr. Sackman. Yes, sir ; he told me they acquired an interest. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 163 

Mr. HALI.EY. So you, at least, know Stacker is in the gambling busi- 
ness; is that correct? 

Mr. Sackman. I know he is in the gambling business from that one 
night of observation in Reno. Now, whether or not that is true I 
don't Iviiow. 

Mr. Halley. He told you he was ? 

Mr. Sackman. He told me he acquired an interest. 

Mr. Halley. Why were you so hesitant in telling the committee 
whether or not you knew his business. You said you didn't have the 
faintest idea of what his business was. You said you just didn't know. 
How else do you know what his business is except from what he tells 
you? 

Mr. Sackman. I try to find out from my personal knowledge. 

Mr. Halley. The man told you he was in the gambling business ; 
did he not? 

Mr. Sackman. Pardon me. He told me he bought an interest in 
the Golden Hotel ; that is what he told me. Now, the Golden Hotel 
does have gambling in it, yes ; but it is possible, without knowing, it 
is possible that he may have let out the gambling concession. 

Mr. Halley. Isn't it a fact that every one of your clients whose 
records you have brought in here today was in the gambling business ? 

Mr. Sackman. I wouldn't know of my own knowledge because I 
never was in their places of business. 

Mr. Halley. But you think so, do you not ? "What is your state of 
mind ? 

Mr. Sackman. You are asking for a state of mind, are you ? 

Mr. Halley. Yes. 

]Mr. Sackman. If it is just a state of mind I will say "Yes." 

Mr. Halley. Your state of mind is that you knew they were in the 
gambling business? 

Mr. Sackman. But not of my own knowledge; I did not see them. 

Mr. Halley. That is understood. 

Mr. Sackman. Yes. 

Mr. Halley. Do 3^ou have any clients who are not in the gambling 
business ? 

Mr. Sackman. Yes; many clients. 

Mr. Halley. Who was the client at Lake Tahoe you were seeing on 
this occasion when you met Joe Stacher ? 

Mr. Sackman. He is an automobile dealer. 

Mr. Halley. What is his name? 

Mr. Sackman. Art Waldorf. 

Mr. Halley. This was at Lake Tahoe ? 

Mr. Sackman. Yes : he owns a house at Lake Tahoe, but his business 
is in Los Angeles. 

Mr. Haixey. I have no further questions. 

Senator Wiley. No questions. 

Senator Tobey. No further questions. 

Mr. Halley. Mr. Sackman. today we want all of Mickey Cohen's 
records and certainly all of Jimmie Utley's records, everything for 
both of them. Then, if you have time after that, we would like the 
rest of the records. The first records we want you to pull are Mickey 
Cohen's, which we want delivered here, in any event, today, and then 
as many of Utley's records as we can get today, and then as many 
other records as we can get today. 



164 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. Mr. Van Brunt will go with you, Mr. Packman. 

Mr. Sackman. After I deliver these records, then I don't have 
to come back ? 

The Chairman. Not unless you are called again. That is all, Mr. 
Sackman. 

Our next witness will be Chief William Parker, of the Los Angeles 
Police Department. We can also have Captain Hamilton testify 
at the same time as Chief Parker is testifying. We can swear them 
both together. 

Mr. Parker and Mr. Hamilton, do you solemnly swear that the 
testimony you give this committee will be the truth, the whole truth, 
and iiothing but the truth, so help you God ? 

Mr. Parker. I do. 

Mr. Hamilton. I do. 

TESTIMONY OF V/ILLIAM H. PAEKEE, CHIEF OF POLICE, AND CAPT. 
JAMES E. HAMILTON, POLICE DEPARTMENT, LOS ANGELES, CALIF. 

Senator Tobey. What is your job, Mr. Hamilton? 

Captain Hamilton. Commanding, intelligence department, ad- 
ministrative bureau, Los Angeles Police Department. 

Mr. Halley. Chief Parker, when did you become head of the Los 
Angeles Police Department? 

Chief Parker. August 9, 1950. 

Mr. Halley. What was your occupation prior thereto? 

Chief Parkp:r. Deputy chief of police, and immediately prior to 
appointment of chief was commander of the patrol bureau for 2i/^ 
months. Immediately prior to that, commander of the bureau of in- 
ternal affairs, which was a new bureau instituted to inquire into the 
conduct of members of the police department and to handle discipli- 
nary problems. 

Mr. Halley. Captain Hamilton, how long have you been head of the 
intelligence unit ? 

Captain Hamilton. Since May of this year. 

Mr. Halley. When was that unit set up ? 

Captain Hamilton. That was set up, I believe, in August of 1949. 

Mr. Halley. What did you do prior to May of this year? 

Captain Hamilton. Chief investigator for the police commissioner. 

Mr. Halley. You have been cooperating closely with this commit- 
tee, I understand, since you have been in that intelligence unit ? 

Captain Hamilton. I tried to use 3^our good offices for information 
whenever we could and also to furnish Mr. Robinson all the informa- 
tion he might be interested in. 

Mr. Halley. I understand it has been a two-way street, and I have 
seen a lot of information that you have supplied. Chief, what is the 
situation in Los Angeles today? 

Chief Parker. The situation in Los Angeles today is probably bet- 
ter than any other comparable city. It is true that we have a large 
number of individuals in the community, that have migrated here 
from elsewhere, that would like to get into racket operations. We are 
doing everything in our power to prevent it. 

(Discussion off the record.) 

Mr. Halley. The question was, some time back, to tell the commit- 
tee about the situation now prevailing in Los Angeles. 



ORGAXIZED CRIME IN INTERSTATE COMMERCE 165 

Chief Parker. Of course, the individuals comiected with organized 
crime have not been my direct concern in the police service until my 
appointment as chief of police because my particular assignments did 
not give me primary responsibility for their activities. 

Mr. Halley. Would Captain Hamilton be better equipped to answer 
the question? 

Chief Parker. Probably not, because Captain Hamilton has only 
had the intelligence section for a few months. I think I can probably 
answer your questions, but I want to preface my remarks by saying 
that I do not have the intimate knowledge of some of the operations 
through the past years. 

Up to the time that the Shaw administration was recalled from 
office, there is little doubt but what this city operated controlled vice. 
It was done by centralizing the responsibility for vice in one squad or 
unit. In the patrol divisions all that an officer was required or was 
supposed to do was to make a report on a prescribed form and send it 
in to headquarters in the event vice operations were observed. Then 
the central vice squad would handle the complaints. Under that 
system they were able to dominate the situation and let those operate 
they wished to let operate. 

The Chairman. Is this prior to 1949? 

Mr. Parker. Yes. The recall came in 1939. when a bomb was placed 
in the car of a man by the name of Harry Raymond and blew up his 
automobile, his garage, and almost killed him. Then came the recall. 
Ma or Bowro:i went into office. 

Then there was a change made in the handling of vice in the police 
department, and each patrol division commander — and there are 12 
of them that blanket the geographical area of the city — became re- 
sponsible for vice repression in his area. 

In addition to that, we have an administrative squad that is the 
guaranty to the chief of police that vice operations are not permitted 
to operate. They are the squad that survey the entire city and deter- 
mine that the divisional vice squads are doing the job. In the event 
they are not, tliey operate directly and oftentimes lend assistance to 
divisional vice squads for problems that arise if they are not equipped 
to cope with the problem. 

From that time on, the vice situation has been hit or miss. There 
has been no real organization, although I do think that the police de- 
partment went into a lethargic state for a period of time. When Gen- 
eral Worton came into office as a temporary chief of police, I was then 
brought in from exile to assist him. At that time there w^ere three dif- 
ferent gangster squads working in the department. They seemed 
to be working at cross purposes ; the information they carried in their 
own minds ; and there was no centralized files. 

In fact, generally they carried their information in the back end 
of tiieir automobiles. We were not happy about the manner in which 
they worked on these so-called underworld characters. So my direct 
knowledge will start back about a year. 

The administrative intelligence unit was created. It was organized 
to assemble information on racketeers and to prepare dossiers on all 
of these people who came to our attention. We began a different type 
of operation in what we called arm's-length surveillance, which means 
our men do not fraternize with the people they are investigating and 



166 ORGANIZED CRIME IN INTERSTATE COMMERCE 

only contact tlieni when they desire to interrogate them on official mat- 
ters, but keep them under surveillance. 

(Discussion off the record.) 

Chief Parker. I would like to explain a little bit about our prob- 
lems, so you can better understand our effectiveness. A survey from 
the Association of the National Chiefs of Police indicated this city 
should have 3 policemen for each 1,000 inhabitants, and that would 
give us a force of approximately 6,000. In the current budget we were 
authorized 4,494, but insufficient money was appropriated to hire that 
number. There is no deficit financing in municipal governments in 
California. There is a constitutional provision against it. 

So that at the present time our force is down to 4,169 policemen a? 
against what we believe sliould be a need of 6.000. When you exam- 
ine into the deployment of this group, you find 1,000 men are on days 
off every day of the month because 8 days off a month are allocated to 
policemen, so that cuts out 25 percent of our force every day. We 
have 453 square miles to police and 2,000,000 people. We have about 
1,000 men assigned exclusively to traffic duties, so it begins to dwarf 
your department down to a small group. 

In the patrol divisions there will be anywhere from three to nine 
men assigned to vice for a 24-hour operation. Some patrol divisions 
are large, like the San Fernando Valley, which covers some 200 square 
miles. That is beginning to be the mecca, I might say of the under- 
world group. They are moving in that direction because of the great 
area and the sparsity of policing. 

We have assigned to intelligence, which is now a division under a 
bureau of administration which I created on the 11th of this month, 
and there are assigned 1 captain, 2 lieutenants, 10 sergeants, and 25 
policemen ; they are doing nothing but organized crime. 

(Discussion off the record.) 

Senator Tobey. What does the average patrolman get, Chief ? 

Chief Parker. Their starting salary is $290 a month, and they get 
automatic raises for the first 3 years to a maximum of $340 a month. 
That is another element. 

Our selectivity is the highest in the Nation. I would like to point 
out that in the last examination 2,387 men took the written examina- 
tion, and only 17 got a passing grade. We took advantage of the 
release of these men from the Armed Forces after the end of hos- 
tilities in World War II, and we have employed over 3,000 men of 
that caliber. Now we are unable to get men of equal caliber. They are 
not responding to the examinations, and we have been unable to get 
Washington to defer our men. We have lost over 200 back to the serv- 
ices of the Armed Forces. 

Senator Tobey. Do you use policewomen ? 

Chief Parker. Yes; about 100. We maintain a jail of about 2,000, 
and that has to be manned out of this group of policemen that I am 
talking about. We have legal handicaps. 

This locality is probably more conscious of their constitutional 
rights than any place in the Nation. They are constantly indicting 
policemen. Our men are instructed not to "tap wires even if the place 
is running wild with criminals. 

_ I am trying to make the request to the legislature to give us a law 
similar to the one that New York has whereby, with judicial process, 
wires can be tapped. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 167 

Of course, this bookmaking thing, it is very hard to combat because 
of that same feature, that we cannot go in on their telepliones. 

Senator Tobey. No one knows that, do tliey ? 

Chief Parker. They all know that. They all have very good at- 
torneys, and they know everything about the laws. So we have those 
handicaps. 

If this committee could see fit to give some small support to giving 
the policemen more tools to work with, it would be appreciated, al- 
though I know that you are interested primarily in matters involving 
interstate activities; nevertheless, telephone activities are interstate. 

If you examine Mickey Cohen's telephone records, it would amaze 
you. I think the last time I looked at them I concluded that my salary 
would not pay his telephone. His contacts run all over the United 
States, I do think we should be able to go in on those wires and find 
out exactly what these people are doing and to whom they are talking. 

Senator Wiley. What does the New York law provide? 

Chief Pariver. I understand they can make application to a court, 
similar to seeking a search warrant, and lay information before the 
court which would justify the issuance of an order permitting the 
tapping of a wire. 

Senator Wiley. An ex parte application, you mean ? 

Chief Parker. Yes. 

(Discussion off the record.) 

Chief Parker. I would like to mention another factor and then pass 
on to something else. That is our inability to get information, such 
as we have just listened to, on income-tax returns. That is a terrific 
handicap to local law enforcement, to be deprived of that. 

Mr. Halley. Don't you have the power of subpena ? 

Chief Parker. No; except through the grand jury or the district 
attorney. 

Mr. Halley. They could do what we did here. You don't need 
an act of Congress to do that. 

Chief Parker. From individuals, yes; but, as I understand the 
Federal policy, they will not release information. 

Mr. Halley. You get the accountant. You can get him ; any State 
authority can get the information by getting the accountant in. 

Chief Parker. The police department hasn't that authority. They 
can tell us anything. We can't swear a witness or they can tell us 
nothing, if they so desire. We have no way of getting the informa- 
tion from them, and we do not use third-degree tactics. 

(Discussion off the record.) 

Chief Parker. One other problem we had here locally was quite an 
abortion racket in the State, which the State crime commission knows 
about, and that was all exjDosed by our department in the bureau of 
internal affairs when I commanded it. That all came about when we 
were attempting to verify an alleged attempted shake-down. 

The Chairman. Does that have interstate aspects ? 

Chief Parker. At one time it looked like it might have interna- 
tional aspects, but I don't think you would be too interested in it. 
There was considerable evidence of graft, but we were unable to trace 
the money again as to where it went. 



168 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You were rather anxious to say something about the 
Guarantee Finance. 

Chief Parker. I wanted to point out that we got records from the 
California crime commission, which they gave us the names of all 
members of our department who apparently were on the books as 
having borrowed money. There were about a half dozen, and we 
checked them all through, and we tried two men before the board of 
rights as a result of their contacts with the company, and we lost one 
case because of lack of evidence. We convicted Sergeant Sumner 
for attempting to collect checks that had been sent back from the 
bank to the Guarantee Finance Co. He was suspended for 90 days, 
and during his suspension we bugged his apartment, and he was 
working for the Guarantee Finance Co. as a collector, and we trailed 
him for several days as he made the collections from bookmaking 
establishments in the county. That is, at the end of the day they 
would settle their accounts up, and the following morning he would 
go out and pick up the money and bring it back to the company. 
We tried him again before a board of rights. In the middle of the 
trial he resigned. So that cleaned us out as far as the Gv^arantee Fi- 
nance Co. was concerned. I don't believe that any member of our de- 
partment is in any position to assist the Guarantee Finance Co. mate- 
rially. I think that was your same conclusion when we talked about 
it before. 

Mr. Robinson. Yes. 

Chief Parker. That any of the pay-olf money that was paid by them 
did not come to members of the police department. 

Mr. Robinson. I think the record should show that Chief Parker 
at that time was in charge of the investigation of the board of rights 
and immediately came over to the crime commission on the Guarantee 
records. 

Chief Parker. We went into every one of those cases. In line with 
some questions that were asked this morning, we discipline a large 
number of men in our department. Our removals will run about 10 
a year in addition to numerous suspensions, and we have 12 key inves- 
tigators, hand selected, who do nothing but investigate the conduct of 
our personnel. While we don't possibly come out with 100 percent 
justice, we certainly try to. 

We have prosecuted about four criminally in the last year. We are 
definitely trying to do the best job which any enforcement agency is 
capable of doing. I think we are making headway, and with more 
committees like this it will be of considerable assistance to us. 

(Discussion off the record.) 

Mr. Halley. Are there any known or suspected gambling or book- 
making places in Los Angeles County that you can tell us about? 

Chief Parker. What we are doing now is sending all information 
we get on any violations anywhere in the county, or other cities in the 
county, to this combined vice squad that the sheriff and district at- 
torney have created. 

Mr. Halley. When was it created ? 

Chief Parker. About 2 months ago. 

(Discussion off the record.) 



ORGANIZED CRIME IN INTERSTATE COMMERCE 169 

Chief Parkp:r, I ayouIcI like to explain to this committee that I have 
a pi-etty heavy job in administering a department of 5,000 employees, 
spending $20,000,000 a year. There is a lot of work that deprives me 
of the opportunity of becoming intimately familiar with all of the 
facts in the operation. 

The information that I am getting is, the bookmakers are very 
unhappy in Los Angeles. One man told me the other day a book- 
maker he knows is moving about every 3 days. He will say, "Don't 
call me for a couple of days." 

We have a new ordinance in the city which makes it a misdemeanor 
to possess evidence of having placed or accepted a bet, a betting 
marker ordinance, in order to make it a little easier to prosecute. 

Eemember bookmaking is a felony in California. It provides for 
a 30-day sentence in the penitentiary, believe it or not, but I don't 
know that anyone has ever gone thei-e. 

You know what evidence you have to have to go through prelimi- 
nary hearings in trials in the superior court on a gambling operation. 
Sometimes it is extremely difficult. Judges may be unsympathetic. 

(Discussion off the record.) 

Mr. Haixey. Is there anything else you would like to tell the com- 
mittee? 

Chief Parker. I have rambled a great deal and probably have taken 
up too much time. All I can do is tell you that I am dedicated to 
getting rid of these people. I would like to say this: That they move 
in on us faster than we can identify them. It is a common thing for 
them to come from other parts of the country, with considerable 
means, and buy homes in nice neighborhoods and settle down and 
appear to be law-abiding people. We don't know anything about 
their presence. 

We are into some things — I believe your committee is working on 
some of these things, in connection Avith some hotel chains. We were 
interested a couple of weeks ago in the ownership of the Spring 
Arcade Building and the Hayward Hotel. 

We find a very peculiar situation in that outfits with the brains 
of financial wizards, like that of the Capone mob, like Evans, we 
find them in the picture. Those things are disturbing to us. 

The Chairman. What is this that you are referring to again? 

Chief Parker. The Spring Arcade Building and the Hayward 
Hotel. It is a hotel located at Sixth and Spring, a rather large hotel. 

The Chairman. What is the other one ? 

Chief Parker. The Spring Arcade Building Corp. That is the 
name of an office building on Spring Street. 

Senator Wiley. Are they all California corporations? 

Chief Parher. Yes. 

The Chairman. Who has moved in on that? 

Chief Parker. A group of people from Chicago, including a man 
by the name of Evans or his wife, Matilda Evans, and Evans was the 
financial wizard of the Capone mob. 

(Discussion off the record.) 



689.'.8 51— pt. 1( 



170 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Chief Pakker. Before I leave, gentlemen, I would like to express on 
behalf of the mayor his regret, because of his inability, to appear be- 
fore the committee. 

You, undoubtedly, know he submitted to a rather serious operation 
a few days ago and is still confined to the hospital. 

The Chairman. We understand that. Will you express our hopes 
that the mayor has a speedy recovery and give him our very best 
wishes ? Our thanks to him for everything, and to you and Captain 
Hamilton for appearing here today. You have given the committee 
very much valuable information. 

Chief Parker. I think I might point out another thing. There is 
no political organization that controls this city such as you find in 
other cities, and that is why our politics are so hectic here. There is 
absolutely no political organization. 

It is a city without political organization, and it has a direct bearing 
on this sort of thing. Without a political organization in control, 
there is no opportunity for the underworld to get control of the politi- 
cal organization or organizations. It has been a distinct asset from 
the standpoint of the police department. 

We have in this community a situation where a police officer may go 
out and arrest anyone upon whom he has evidence, and they all know 
that, without fear of any recrimination whatsoever. It is a very 
healthy situation. 

Now, I mean by that if friends of mine are arrested and they say, 
"I know Chief Parker," that doesn't mean a thing to the police officer. 
I think that is a situation that is unique here in America. 

We have a fine department, gentlemen, but it is undermanned ; but 
as they gain greater experience we are going to do a better job and 
we are going to relentlessly pursue this situation to the best of our 
ability. 

As Captain Hamilton pointed out to you, they come in here and we 
don't know them. They invest the money they made, God knows how, 
in legitimate enterprises, and we can't prevent that. 

We suspended the police permission permit on a second-hand group 
down at the south end, who were doing a million dollars worth of 
business a year and both owners of that group have eastern records. 
It was suspended because of three transactions which were not reported 
and one included the purchase of stolen lead from a naval employee. 
Those people just recently moved their operation into the city of Los 
Angeles. 

The Chairman. "V^^o are they ? 

Chief Parker. I don't remember the names, but we have letters from 
the big steel companies, letters of commendation. They are fighting 
us in court, these individuals whose permits were revoked, right now. 
That is what we are faced with, and we are just a group of police 
officers. 

Senator Wiley. This just comes to me: You appreciate fully tho 
jurisdiction that the Federal Government has. Wliat suggestions do 
you have whereby the Federal Government can, through legislation or 
otherwise, more than what we are doing, be of assistance in seeking, 



ORGANIZED CRIME IN INTERSTATE COMMERCE 171 

first, to clean up the mess, and what I think is most important, to 
arouse the conscience of the community in which conditions exist so 
the community also will take hold. 

Chief PARiiER. That is extremely important because the dignity of 
your committee and its national significance is such that it is a news 
item. Your expressions, whether they be good or bad, are taken quite 
literally by those who read them. You have an opportunity to give 
support to those agencies that you see are doing justice or condemn 
those you believe should be condemned. That is very important, 
whatever this committee says. We need the support of the public in 
what we are trying to do, and that is very vital. 

If grand juries don't indict, if juries don't convict, we waste our 
time; and if people don't give us information that hurts us too. 

On the other hand, if we do then we are going to make progress, if 
we receive support from the public and support from committees like 
yours. On the other field of legislation, I think there should definitely 
be a Federal law prohibiting the transmission of gambling informa- 
tion from one State to the other, the lay-off of bets, and the utilization 
of any means of communication. 

I believe there should be a Federal law, which would permit the 
interception of any means of communication, telephonic, telegraphic, 
radio or otherwise, in order to determine whether or not the laws are 
being violated. 

It goes without saying that a shipment of gambling equipment — 
practically all of the crooked gambling equipment is made in Chicago. 
They make crooked dice and crooked roulette wheels and slot machines 
and they even publish catalogs about it. That might be subject for 
concern as far as Federal legislation is concerned, on the basis of inter- 
state commerce. 

Those are about the only suggestions I think of at the present time. 

Captain Hamilton. My bet, since we are dependent on the exchange 
of informaion, particularly from the East, is to find out about these 
people coming out here. Now, there is no central Federal agency 
in the United States that is interested in organized crime locally. I 
believe the nearest we have is Commissioner Anslinger of the Nar- 
cotics Bureau. I find they are far more conversant with the people 
we are interested in than any other agency in the United States. 

For example, here in Los Angeles the Federal Narcotics have only 
three men, but they have more information for three men than any- 
one I have ever known of. I can't see how they assemble the informa- 
tion that they do. Most of our exchange of information is done on 
a personal basis with individuals throughout the United States. A 
Federal central agency for the compilation and exchange of this in- 
formation with their officers in the field would be a great help to any 
local enforcement agency that really wants to do something about 
crime. 

Senator Wiley. Do you have any definite suggestion ? 

Captain Hamilton. Just the expansion of a now existing agency. 

Senator Wiley. The FBI? 

Captain Hamilton. The FBI so far has not been interested in this 
type of individual that we are talking about. 



172 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Chief Parker. They are in a good position to assist us because they 
have all of these criminal records. 

Senator Wiley. I have often thought about it myself. What you 
mean is while they wouldn't have jurisdiction they could just as well, 
if they were given the authority, give information in relation to those 
matters ? 

Captain Hamilton. Yes. Heretofore in most instances with the 
Federal agency it is a one-way road on information. We gladly give 
them all the information we can assemble to try and rid ourselves of 
any characters or help someone else rid themselves of characters. It 
is too much of a one-way road. 

Their files are not open to scrutiny by local officers and I can under- 
stand their position; it is a matter of knowing who you are dealing 
with in every instance, but it is a definite handicap to an area such as 
this area, which is so big, which has the big transient problem and the 
constant influx of hoodlums from all over the country. It is axio- 
matic in eastern cities, when the snow flies the hoodlums fly with the 
snow. They go to Miami or come to Los Angeles. I have talked to 
many officers back there about that. 

Their crime decreases in the winter and ours increases. We are in 
a position that we need that information much more than your eastern 
cities need it. 

You do not have, as you gentlemen know, the transients in your 
eastern cities in proportion to the population that we have out here. 
Until we can have such a source of information we are spending too 
much of the taxpayers' money to get it in our way, what little infor- 
mation we do get. If there were such an agency created for that 
exchange of information, it would be cheaper to get the information 
than it is now and it would be much more beneficial. 

Chief Parker. I think that same factor would apply to some sort 
of control, access to Federal income-tax returns. At the present time, 
as I understand it, it must be a request from the governor of the State 
or the President of the United States to get that informaion. 

Senator Wiley. What about your State ? 

Chief Parker. We can probably work that out since they are be- 
coming interested in that phase of it. 

The Chairman. We are very grateful to both of you gentlemen. 

Mr. Halley. Captain Hamiliton is to bring in some records tomor- 
row morning. You will bring in the toll calls and the county spots 
that you know of in the last 2 years and your report on the surveil- 
lance of Mickey, and the people he saw. 

Chief Parker. Any information that you fellows get that would 
help us, locally, in prosecuting some of these people we would 
appreciate. 

The Chairman. Very well. We will now call in the press. 

press conference 

(Whereupon the following proceedings were held in open session :) 

The Chairman. Ladies and gentlemen of the press, this afternoon 

we have spent a great deal of time with Mr. Harry Sackman, who is 



ORGANIZED CRIME IN INTERSTATE COMMERCE 173 

the public accountant and tax consultant for Mickey Cohen, and who 
for some time has kept Mickey Cohen's records and books. Also 
amongst many other customers of his are Phil Tapper, Jimmy Utley, 
Irving Glasser, and Hymie Miller. 

As to Mickey Cohen, I think the most interesting part of the testi- 
mony — we have a fairly voluminous record on it — that Mr. Sackman 
has brought in some of these records, all of them being brought in 
under subpena. He brought them under subpena duces tecum. The 
most interesting part of the record about Mr. Cohen is that he has not 
reported very substantial income. His expenses have been quite 
substantial, and over a period of years he has been showing that he 
borrowed very substantial amounts of money from various and sundry 
persons, in excess of $140,000 in 1947; in ex.'ess of $50,000 in 1948 and 
'49, and in excess or about $60,000 so far this year. The purpose, of 
course, is to be able to balance his income with his outgo or to make 
it more nearly so. 

As to these other men who have been mentioned, they have operated, 
have extensive operations or have had, at Stockton and San Francisco, 
of bridge and bingo games, permits for which were withdrawn about a 
year ago by the chief of police of Los Angeles. 

Their income from these operations was quite extensive and we are 
going into the matter further. 

We have had before us at great length, and a staff of our committee 
has been working with Chief Parker and Captain Hamilton of the 
police department for many months, tying in interstate links between 
people operating here and in other sections of the United States: 
Chicago, Brooklyn, New York, and New Jersey among other places. 
The feeling of the committee is that Chief Parker and Captain 
Hamilton are capable and intelligent men, who are determined to do 
a good job and who are bringing about considerable improvements, 
substantial improvements, to the Los Angeles police force. They state 
they do have some difficulty, but because of the influx of people into this 
section, very frequently racketeers or gangsters may come here and 
they come faster than they can identify them. They first pose or 
go into business as being respectable citizens and later on they find 
out they have racket connections. They seem to be doing very well 
with the staff that they have, according to all of the studies of the 
police department. With their population they need about 6,000 
policemen. They have about 4,169 ; which is not sufficient. 

They feel that the combined unity of the city and the county, which 
was inaugurated about 2 months ago, for the purpose of exchanging 
information and working together for the elimination of organized 
criminal activities in the city and county, has been fairly successful 
and is doing well. 

They have told us the background of Mickey Cohen, Jack Dragna, 
the Sica brothers, and many others who have had — or are operating 
in Los Angeles. They say that they think they have most of the big- 
time gambling fairly well under control, but one difficulty they are hav- 
ing is they have now started making collapsible crap tables which can 



174 ORGANIZED CRIME IN INTERSTATE COMMERCE 

be carried in the back of automobiles. They take them to a private 
home and the operators will get their customers to this home for a 3- 
or 4-night stand or a week's stand, and then move on somewhere else. 
It is a collapsible table, but when put together it is a full-sized table 
and fits into the back of an automobile. 

We have discussed with them information that they have about or- 
ganized crime in this whole section of southern California. They 
say that they have information which fits in with our Chicago inquiry : 
that Jack Dragna did go to Chicago to see about his difficulties with the 
Illinois Sports News, which is the Continental outlet there. At the 
time they dropped him from a $500-a-week job, which was some time 
prior to that time. The Illinois Sports News is an outlet of Conti- 
nental and they had been paying him $500 a week for the purpose of 
gathering information that he put it on the wires for Continental. 

Mr. Hallet. There was some publicity about it and that fact came 
out into the open and they dropped him. 

The Chairman. The police department had seized his records. 
These officers say, where they tised to have trouble with labor racket- 
eering in this section of the country, they felt that the AFL and the 
CIO were stable and that certain elements had been ousted by the 
CIO, and there was no real evidence of labor racketeering in the 
unions in Los Angeles at the present time 

They told about some difficulties the}' were having with prostitution, 
particularly the call houses. They went into length of the great 
amount of difficulty that they were having, and quite intelligently so, 
I think, in recommendations as to things this committee should be 
interested in. They recommended from the viewpoint of local en- 
forcement that the elimination or at least putting some blocks or 
delay in the giving of racing information would be of great value to 
them in preventing bookmaking. They feel that the shipment of 
gambling devices should be prohibited in interstate commerce. 

The chief and Captain Hamilton stressed the necessity of authoriz- 
ing some Federal agency or creating some Federal agency for the 
purpose of disseminating information about organized criminals and 
crime to the local enforcement officers. They suggested, whereas the 
FBI does not now have this jurisdiction and is not especially interested 
in such things as gambling and the organized rackets growing out of 
gambling, that it would be of tremendous assistance if they could more 
readily get information from some central Federal agency. 

Chief Parker also feels that under certain cases income-tax infor- 
mation of the Federal Government should be given to the local enforce- 
ment officers ; also that there should be some uniform method of secur- 
ing information of intercepting communications, where a court or a 
judge has acted upon the necessity of having this information. 

Tomorrow morning we will commence at 9 : 30 in this hearing 
room, with Mr. Ruditsky, and at about a quarter of 11 or 11 o'clock, 
when Judge Carter is through with his naturalization hearings, we 
will have an open hearing in his courtroom. 

We have invited the sheriff to appear, if he is here. We have also 
invited Mr. Mickey Cohen to appear. I believe that is everything 
unless there are some questions. 

Senator Wiley. I want to compliment the chairman on his i^sume 
of the testimony as given this afternoon. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 175 

I have just one additional suggestion, which I think the press might 
well bring to the citizens of this community, and tliat is that the 
j)roblem is essentially a local problem and that, while we are seeking 
to ascertain interstate connections, it is very important that the citi- 
zens themselves be aroused to full cooperation with good officers and 
that, when you have good officers, they be patted on the back for the 
efforts that they are making. But, more than that, that the citizens, 
if necessary, may even have to organize a certain type of group to 
assist — not a vigilante group, because they can't take the law in their 
own hands — but they can back up good enforcement officers and thus 
maintain the morale in the community that is necessary. 

Member of the Press. Was there anything further on that Guar- 
anty Finance Co. and the sheriff's office? 

The Chairman. We didn't have anything further on that this 
afternoon. 

]Member of the Press. I didn't hear what you said about inter- 
cepting communications, Senator. 

The CHAiRarAiSr. I was telling about what the recommendations of 
Chief Parker and Captain Hamilton were, as to what would help 
them with their enforcement work. They said that if under proper 
methods— that is, by a petition to court — showing the necessity of 
intercepting communications in certain cases, where the court would 
decide it was necessary, that if some method of that sort were pro- 
vided that it would be of tremendous assistance to them. Some States 
have authorized wire-tapping. Some States do not and some places 
they can, and in other places they do it anyway. 

The testimony here is that these officers do not engage in wire-tap- 
ping. We have had some in the District of Columbia, and the State 
of New York has a law which is considered by many enforcement 
officers as being very good, which requires that when the public wel- 
fare demands it that a petition may be pi'csented to a supreme-court 
judge, and if a proper showing is made as to the necessity of tapping 
a certain wire, that he can issue an order for that purpose. 

Member of the Press. Then the man who has the wire tapped knows 
about it ? 

The Chairman. It is an ex parte proceeding. 

Member or the Press. Does Mickey Cohen face any contempt pro- 
ceedings if he refuses to testify. Senator? 

The Chairman. We will get around to that if it comes about and, of 
course, it depends on the circumstances. 

Member of the Press. Will the sheriff's appearance be in open hear- 
ing also, Senator ? 

The Chairman. We have invited him. I do not know if he will be 
back. He is attending some convention in the State of Washington. 

We feel, in view of what was said about the sheriff's office this morn- 
ing, that if he appears it should be in an open hearing. 

Member of the Press. If he misses this hearing, will you have him 
testify in San Francisco? 

The Chairman. I have an idea he will be back sometime and he 
will have an opportunity to testify. I may state that it is our general 
policy that if anyone's name is used and they feel that they have been 
wrongly, labeled or improperly accused, or if they wish to make any 
explanation, we are always very happy to give them an opportunity 
to do so. 



176 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Member of the Press, Conld we go back to Mickey Colien's bor- 
rowings for those 4 years you mentioned 'I Were those debts repaid ? 

The Chairman. Practically nothing has been repaid. The informa- 
tion is that Mickey Cohen will call in and give his auditor his informa- 
tion about who he had borrowed from and he just makes a note of it. 

Member of the Press. Is it borrowed from individuals ? 

The Chairman. Just from individuals ; yes. 

Member of the Press. From racketeers? 

The Chairman. I cannot at this time divulge the names of the peo- 
ple that he borrowed from. 

"Member of the Press. Are you imph'ing that he was concealing 
income ? 

The Chairman. I was implying that his expenses, which are quite 
well known, are so substantial that his income, as shown, is very small ; 
that it is necessary, in order to satisfy his income-tax returns, that he 
have some way of getting additional money into his possession. In 
other words, he is trying to make them balance. Net-income cases 
are developed, as you well know, by showing the amount of expenses 
a person has and showing what income he has. Then, if there is a 
substantial difference, it is a net-income case. 

Member of the Press. Senator, in the examination of Harry Sack- 
man, the accountant, did you question him at all about his efforts in 
behalf of the Guarantee Finance Co. ? 

The Chairman. Yes; we did. 

Member of the Press. Was there any discussion of hot merchandise 
in interstate commerce, as against race information, stolen goods from 
New York and brought out here ? 

The Chairman. We have some information about that this after- 
noon. 

Member of the Press. Was there anything brought out about 
diamonds ? 

The Chairman. No ; we did not get into the diamond business. 

Member or the Press. I believe the name of Eddie Nealis was 
brought up. Are you going to drop that ? 

The Chairman. All those cases will be developed further. 

Member of the Press. In an open hearing ? 

The Chairman. They will be developed, first, in a closed hearing. 

Member of the Press. Will Nealis be subpenaed ? 

The Chairman. I don't know. 

Member of the Press. Senator, if you find anything interesting in 
these records, will you turn them over to the Internal Revenue Bureau ? 

The Chairman. We cooperate with them, and they cooperate with 
us. 

Member or the Press. Did Mickey Cohen ask for the open hearings ? 

The Chairman. He did not. 

Member of the Press. He asked once before for an open hearing. 
Was there any mention of the success of the new California slot- 
machine law ? 

The Chairman. We have not discussed the new slot-machine law, 
nor how it operates nor the success of it. 

Member of the Press. Have any of the witnesses refused to testify 
thus far, since Las Vegas, the Las Vegas hearing ? 

The Chairman. We didn't have any refusal to testify in Las Vegas. 



ORGANIZED CRIME EST INTERSTATE COMMERCE 177 

Member of the Press. I mean since then. 

The Chairman. No. 

Member of the Press. Just one more question about Harry Sack- 
man. Can you give us any of the details about his testimony in con- 
nection with the Guaranty Finance Co., or is that being withheld at 
this time ? 

The Chadjman. There is certain information he gave that we have 
to develop other parts of. I do not think I should give it out at this 
time. He did make certain tax returns for the company, though. 

Member of the Press, In regard to Mickey Cohen, you said he has 
not reported substantial income ; is that based on estimates from Harry 
Sackman ? 

The Chairman. That is right ; yes. There is one point, perhaps, 
that I should bring out. Perhaps Mr. Kobinson can tell you about 
that. 

Mr. Robinson. Sackman was questioned concerning his trip back 
East, and he acknowledged while he was back there he had com- 
municated with Joe Stacher of New Jersey and further acknowledged 
he spent a couple of days with him in Reno, in connection with 
Stacher's interest in the Bank Club. 

The Chairman. Stacher had told him that he had bought an inter- 
est in the Bank Club. That is relevant, in view of the testimony we 
got at Las Vegas, that Stacher bought an interest but couldn't get a 
license to operate, and he threatened he was going to spend a lot of 
money to get a change of administration in Reno. 

]\Iember of the Press. Who are the other partners in that Bank 
Club? 

Mr. Robinson. Graham and MacKay. 

The Chairman. The hearing will be recessed until tomorow mor- 
ning at 9 : 30 o'clock. 

(Whereupon, at 6:10 p. m., the hearing was recessed until 9:30 
a. m., November 17, 1950.) 



INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE 

COMMERCE 



FRIDAY, NOVEMBER 17, 1950 

United States Senate, 
Special Committee To In\^stigate 
Organized Crime in Interstate Commerce, 

Los Angeles^ Calif. 

The committee met, pursuant to call of the chairman, at 10 a. m. in 
the United States courthouse, Senator Estes Kefauver (chairman) 
presiding. 

Present: Senators Kefauver, Tobey, and Wiley. 

Also present : Rudolph Halley, chief counsel ; Harold G. Robinson, 
associate counsel and chief investigator ; William G. Ruymann, special 
counsel ; Herbert Van Brunt, special representative to the committee ; 
and Julius Cahn, administrative assistant to Senator Alexander Wiley. 

(The following proceedings were held in open session:) 

The Chairman. The committee will come to order. I regret exceed- 
ingly, but before the open hearing starts we will have an executive 
hearing for about 20 or 30 minutes. We will then have a short recess, 
and you will all be invited to come back. 

We are very grateful to Judge Carter for the use of this beautiful 
courtroom. He has gone to a good deal of trouble to make it available 
to us. Because of the air-conditioning system and also the fact that 
the floor burns very easily when cigarettes are put on it, we will have 
to ask the committee and also our guests not to smoke during the 
hearing when you come back. That is a hardship on the committee, 
as well as it is on the press and our guests in the audience, but in defer- 
ence to the court and to the courtroom we will have to make that 
request. 

I am sorry that we will have to ask everyone to leave except those 
connected with the committee at this time. 

Our first witness will be Barney Ruditsky. 

(Whereup the following proceedings were had in closed executive 
session : ) 

TESTIMONY OF BARNEY RUDITSKY, LOS ANGELES, CALIF. 

The Chairman. Mr. Ruditsky, 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. Ruditsky. I do. 

The Chairman. You may proceed, Mr. Halley. 

Mr. Halley. "AYliat is your name ? 

Mr. Ruditsky. Barney Ruditsky. 

179 



180 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. Where do you live ? 

Mr, KuDiTSKT. 1771 North Sycamore. 

Mr. Hallet. Los Angeles ? 

Mr. RuDiTSKY. Los Angeles, Calif. ; yes. 

Mr. Halley. What is your business ? 

Mr. RuDiTSKY. Right now I am executive director for the Cali- 
fornia Belt and Accessories Manufacturers Association. 

Mr. Halley. How long have you been executive director to that 
association ? 

Mr. RuDiTSKY. Since May 22 of this year. 

Mr. Halley. When was this association organized ? 

Mr. Ruditsky. Four or five j^ears ago. 

Mr. Halley. Have you been associated with them prior to this 
year ? 

Mr. Ruditsky. No ; I have not been. 

Mr. Halley. Did you ever have a business known as the Associated 
Security Council ? 

Mr. Ruditsky. I did ; yes. 

Mr. Halley. What was the nature of that business ? 

Mr. Ruditsky. That was a detective agency. 

Mr. Halley. In Los Angeles ? 

Mr. Ruditsky. That is right; 88I8I/2 Sunset Boulevard. 

Mr. Halley. Were you licensed as such ? 

Mr. Ruditsky. Yes. 

Mr. Halley. I take it, then, that you have never been convicted of a 
crime ? 

Mr. Ruditsky. Never have been ; no. 

Mr. Halley. Have you ever been arrested? 

Mr. Ruditsky. Since then for a liquor violation. A waitress in a 
restaurant I had sold a drink after hours, and they took the owner in 
for it. 

Mr. Halley. What restaurant was that ? 

Mr. Ruditsky. Sherry's ; 9063 Sunset Boulevard, I believe. 

Mr. Halley. Do you still own Sherry's Restaurant ? 

Mr. Ruditsky. No. 

Mr. Halley. Do you have any other businesses ? 

Mr. Ruditsky. Nothing at all. 

Mr. Halley. Among the functions of the Associated Security Coun- 
cil, did you collect bad debts for the gambling establishments at Las 
Vegas ? 

Mr. Ruditsky. I originally opened up just doing detective work 
with another man by the name of Herman Kader, a retired detective 
from Bayonne, and a man by the name of Lefty James, a detective, 
retired. We broke up and I retained the business; I bought them out. 
We then went into the check-collecting business. We went up to Las 
Vegas — rather previous to that I had made contact with Horace Heidt, 
who owned the Nevada Biltmore, and he turned over a lot of checks 
to me. I then went to Las Vegas with a partner ; I had a man by the 
name of Charley Dorfman, and we contacted Mr. Bill Moore at the 
Last Frontier, the people at the El Ranclio, and I think it was Bennie 
Siegel and a man by the name of Hjaiiie Siegel at the Flamingo. They 
gave us some checks. They gave us the tough ones to collect. 

After doing that for about — I guess we attempted it for about 5 
or 6 weeks, and we found that it wasn't much good and that we 



ORGANIZED CRIME IN INTERSTATE COMMERCE 181 

couldn't do much with it; most of the people we called and we wrote 
them letters. We didn't use any bullying tactics. That wouldn't go, 
and we wouldn't use any bullying tactics. 

Mr. Halley. For what hotels in Las Vegas did you collect ? 

Mr. RuDiTSKY. The El Rancho, the Flamingo, the Nevada Biltmore, 
and we did a survey of — a business survey — for Mr. JSIoore at the Last 
Frontier. 

j\Ir. Halley. With whom did you deal at the El Rancho ? 

Mr. RuDiTSKY. A fellow by the name of Resnick or something like 
that — a tall, thin fellow. 

]\Ir. Halley. With whom did you deal at the Flamingo ? 

Mr. RuDiTSKY. Directly with Mr. Bennie Siegel. 

Mr. Halley, How long had you known Siegel? 

Mr. RuDiTSKY. I knew Siegel when he was about 14 or 15 years old. 

JNIr. Halley. You mean back in New York ? 

Mr. RuDiTSKY. Yes. I had arrested him in New York on one occa- 
sion. 

Mr. Halley. Were you a New York detective? 

Mr. RuDiTSKY. I was a detective in New York ; yes. 

Mr. Halley. ITp to what year ? 

Mr. RuDiTSKY. Up to 1941. I retired October 19, 1941. 

Mr. Halley. What bureau were you in ? 

Mr. RuDiTSKY. The detective division, the gangster squad, the 
Broadway squad, and I was in the radical squad. 

Mr. Halley. In Manhattan ? 

Mr. RuDiTSKY. For five boroughs. 

Mr. Halley. You worked out of headquarters ? 

Mr. RuDiTSKY. Yes. 

Mr. Halley. Did you resign ? 

Mr. RuDiTSKY. I retired ; my time was up. 

Mr. Halley. Was your record completely clear at that time ? 

Mr. RuDiTSKY. I never had a charge of any kind brought against 
me. 

Senator Wiley. Did you get a pension ? 

Mr. RuDiTSKY. Yes, sir ; $2,000 a year. 

Mr. Halley. You also got business from Al Smiley at the Flamingo, 
did you not ? 

Mr. RuDiTSKY. Smiley came down to see me at my office one day and 
he started telling us how we would collect the checks, the tactics he 
was going to use. I said, "That won't go with us." I said, "You either 
want us to collect them in a legal manner or you better get someone 
else." Then I was notified that my detective license didn't permit us 
to collect bad checks. So I immediately made inquiries from the 
bureau of standards here, and they said, "You need a license for that." 
Rather than go into the expense of a new license, we turned the checks 
over to a collection agency ; it was the Mutual. I turned it all over to 
them. In fact, we had collected very, very few; I don't think we 
collected $400 or $500 worth at that time, although there was hundreds 
of thousands of dollars' worth. 

Mr. Halley. Did you talk to Siegel shortly before his murder? 

Mr. RuDiTSKY. I did. 

Mr. Hali^y. At that time did he discuss his financial status with 
you ? 



182 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. RuDiTSKY. He said that business was bad. There was an 
instance that I can tell you of where he was picking up cigarette 
butts and burning the carpet. He said, "The fellows are driving me 
crazy ; it is not good and we are losing money." 

Senator Wiley. When was that? 

Mr. RuDiTSKY. In 1947. 

Mr. Halley. He was killed in June of 1947 ? 

Mr. EuDiTSKY. Yes ; that was the early part of 1947. 

Mr. Halley. Did Siegel tell you how much money was invested in 
the Flamingo ? 

Mr. RuDiTSKY. He said about $7,000,000 or more. 

Mr. Halley. Did he say he had to raise any cash ? 

Mr. RuDiTSKY. He did say that he had been going back east and 
bringing monev back. 

Mr. Halley.' Did he use the figure of about $4,500,000? 

Mr. RuDiTSKY. I don't remember whether he said that or not. He 
said that he was going back east and bringing back brief cases full of 
money. It was being brought out to him. 

Mr. Halley. Did he tell you any of the people who had invested in 
the Flamingo with him? 

Mr. RuDiTSKY. No; he said, eastern money; all eastern money." 

JSIr. Halley. Did he have Monk Schaef er with him ? 

Mr. RuDiTSKY. Monk Schaef er was working there. I think he was a 
pit boss. 

Mr. Halley. He was running the pit ? 

Mr. RuDiTSKY. Yes. 

Mr. Halley. Schaef er is one of these professional gamblers ; is that 
correct ? 

Mr. RuDiTSKY. I think he is from around Detroit. 

Mr. Halley. He runs the circuit ; does he not ? He would work at 
the Colonial at Miami and at different places; work the circuit, so to 
speak ? 

Mr. RuDiTSKY. They have circuit runs all over the country, these 
fellows. 

Mr. Halley. How does it work ; will you tell the committee ? 

Mr. RuDiTSKY. In my opinion, these fellows — in fact, there was a 
remark made to me a number of years ago, about 3 or 4 years agOy 
one of my trips back east, in talking to one of these fellows, that they 
made $21,000,000 in one season in the combination to be split up 
among about 26 men in this combination ; that they made that between 
Florida and Jersey and out in Vegas, that combination. 

Mr. Halley. And how about Saratoga? 

Mr. RuDiTSKY, I believe Saratoga too; that was part of the com- 
bination. 

Mr. Halley. Was southern or northern Kentucy in it ; Covington 
and Newport, or was that an independent outfit ? 

Mr. RuDiTSKY. That was an independent outfit. Cleveland, I un- 
derstood, was among them. There was a Cleveland outfit, the Beverly 
Club. 

Mr. Halley. You are referring to the Beverly Club in Kentucky^ 
aren't you ? 

Mr. RuDiTSKY. Yes ; the one owned by Phil 

Senator Wiley. I don't think that is very clear, that it was just sa 
many million. Tell us more about that. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 183 

Mr. RuDiTSKY. The combination was running, from my knowl- 
edge — I mean from conversations that I heard — was the one in Jersey, 
the one in Florida, Saratoga Springs, and Las Vegas — Cleveland was 
out, I guess. That was the combination that cut in on all these places. 

Mr. Hallet. You are now talking about gambling establishments, 
as contrasted to bookmaking? 

Mr. EuDiTSKY. That is right, gambling establishments. 

Mr. Hallet. Who are the men that you identify as being prominent 
in the group of 26 or 30 men who controlled this gambling com- 
bination ? 

Mr. RuDiTSKY. Well, this is an opinion from my experience with the 
underworkl while a detective. One was Abner "Longie" Zwillman, 
a Newark man. Also a fellow by the name of Rosen, whose nickname 
is "Doc Harris" who is also from Newark. 

Mr. Hallet. Is he also known as Joe Stacker ? 

Mr. RuDiTSKT. That is right. 

Mr. Hallet. He is the man who tried to buy in at Reno a year or 
so ago^ 

Mr. RroiTSKT. In fact, the information was that all of them were 
trying to come out here buying in at Reno and Las Vegas. 

Mr. Hallet. When did you have such information ? 

Mr. RuDiTSKT. About 2 years ago now. 

Mr. Hallet. Go ahead. 

Mr. RuDiTSKT. Then in New York, the information was there was 
a fellow by the name of Tom Cutlow, called "Cutley." There was 
Meyer Lansky and his brother. 

Mr. Hallet. And his brother? 

Mr. RuDiTSKT. Yes. Then there was Harry "Nig" Rosen and his 
brother Dan. 

The Chairman. Herman Stromberg? 

Mr. RuDiTSKT. Yes. That is about all I know of. 

Mr. Hallet. How about Frank Costello? 

Mr. RuDiTSKT. The only connection I have with Frank Costello, 
when I got out of the Army I opened a little liquor store on Sunset 
Strip when I got out of this war here. After I retired, I got in the 
Army and then opened up this liquor store and it was a little rough 
getting liquor unless you went through the black market. I didn't 
feel like going through that. Somebody told me that Frank Costello 
had owned the King's Ransom and the House of Lords scotch. I 
said to myself, maybe I will send him an appealing letter, and I did. 
The result was nil and I got no liquor. It was coming out here to a 
man by the name of Irving Haymes, who is a partner of Costello in 
the distillery. He had a liquor store on Hollywood Boulevard and he 
V\-as getting all the scotch and no other store in town would get it 
unless they paid black market prices, which most of us wouldirt do. 

Mr. Hallet. So that you identify Frank Costello mainly with the 
New Orleans operation ; is that right ? 

Mr. RuDiTSKT. Yes, and with the whisky. The last time I had seen 
Costello, while I was still in the police department, and I had an inves- 
tigation and he was connected with a j)lace on Fifty -fifth Street called 
Phonevision. 

Mr. Hallet. Do you know Jimmie Lynch ? 

Mr. RuDiTSKT. From Jersey? 



184t ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Yes. 

Mr. RuDiTSKY. "One Eye" Lynch ? 

Mr. Halley. Yes. 

Mr. RuDiTSKY. Yes. 

Mr. Halley. Isn't he reputed to take his cut in the game for 
Costello? 

Mr. RuDiTSKY. I know he is in on the games, I know that. 

Mr. Halley. But doesn't he hold his share for Frank Costello? 

Mr. RuDiTSKY. That I wouldn't know ; I have been away from that 
so long. 

Mr. Halley. That game is supposed to pay off Charley "Lucky" 
Luciano; is it not? 

Mr. RuDiTSKY. The understanding I get is that he is still one of the 
controlling factors. 

Mr. Halley. How would you explain to the committee the continu- 
ing power of Charley "Lucky" Luciano from Italy ? 

Mr. RuDiTSKY. Of course, a lot of the eastern mob have been tied 
in on narcotics. As you know, there is labor and beer and other rack- 
ets, and "Lucky" was one of the powers in those days of narcotics. 
When he went to Italy it was my belief that he made all their contacts 
for them and he was still a power, notwithstanding the fact that he 
was convicted for keeping and maintaining and it was my belief that he 
had nothing to do with that, my personal belief, knowing him as being 
on the gangster squad. But "Lucky" was still a great power, a great 
factor in the underworld. He was a great power in the underworld 
when he was convicted and he still is. 

Senator Tobey. I guess he is what you would call a sweet character ? 

Mr. RuDiTSKY. Oh, yes. 

Senator Tobey. And was he yellow? 

Mr. Ruditsky. They are all yellow. Unless they have you in an 
automobile and could put a gun to your head, then they were all yellow. 
That was my opinion. I have been threatened a thousand times by 
different ones, but I got around them pretty good in my time; nobody 
got back at me. I walk around without any guns and without any 
fear. 

Mr. Halley. You wrote a book on this subject; isn't that right? 

Mr. Ruditsky. I have a book called "Angel's Corner." It has been 
published. It is the ramifications of the miderworld during the 
prohibition era. 

Mr. Halley. Did you describe the meeting held in Atlantic City 
about 19f35 in your book ? 

Mr. Ruditsky. I did. 

Mr. Halley. Will you tell the committee the basis of your 
knowledge? 

Mr. Ruditsky. There was a meeting called in Atlantic City of about 
132 members of the underworld, from all parts of the United States. 

The Chairman. "What was the date ? 

Mr. Ruditsky. I believe in early 1932. 

Senator Tobey. Who called it? 

Mr. Ruditsky. It was called in those days by Big Frenchie, who 
was still alive. He called a meeting. He was with Owney Madden. 
He called this meeting and the purpose was to apportion the rackets to 
the different people ; the syndicate was going to maintain it but there 



ORGANIZED CRIME IN INTERSTATE COMMERCE 185 

wouldn't be any cutting in and they decided to stop killing one an- 
other. They held this meeting. I don't know what went on at the 
meeting but they assigned diit'erent parts of the country to different 
men ; different parts of the rackets. At that time a very funny inci- 
dent occurred. They presented a watch to Owney Madden and Big 
Frenchie was to present the watch to him. Now he never had made a 
speech in his life. He got up to the dais and he said, "Owney, have you 
got a watch?" And he said, "Yes." He took it off and showed it to 
him. He dropped it and stepped on it and he said, "Gee, I am sorry I 
broke your watch, but here is another one for you," and presented him 
with this watch. That is the way he presented the watch to Owney 
Madden. 

Senator Tobey. I am not sure that that isn't a better speech than a 
lot of Senators make. 

Mr. Halley. Turning now to the Los Angeles-Las Vegas area, do 
any of the Chicago racketeers have interest in this area? Do the Fis- 
chettis, for instance, have an interest? 

Mr. RuDiTSKY. I don't know. I will say this, frankly, for the Los 
Angeles Police Department. I know they are very much afraid of the 
Los Angeles Police Department. 

ISIr. Haleey. How about Las Vegas ? Did the Fischettis have any 
interest in the Flamingo? 

Mr. RuniTSKY. Well, they go there quite a bit. 

Mr. Haleey. Do you know if they own any part of the Flamingo? 

Mr. RuDiTFKY. I don't. I know that Ralph Capone would come 
here and wouldn't stay here 2 minutes and go right out to Las Vegas. 
He used the name of Morris, I believe. They wouldn't stay around 
here too long. 

Mr. Halley. What has been the over-all picture here in Los Ange- 
les, in this vicinity, since about 1940? Are you familiar with it since 
1942 or does your knowledge begin about 1945 ? 

Mr. RuDiTSKY. Of course, when I came out of the Army it was in 
1944 or 1945. 

Mr. Halley. Who were the leading racketeers here in 1944 and 
1945? 

Mr. RuDiTSKY. The only one I knew at the time was Bugsy Siegel; 
I knew him from the East. I never made any contact with him here. 
I saw him once or twice. Up to that time I met him up at Vegas when 
I went into the detective agency. I paid little attention to the racket 
end of it out here. I wasn't interested. I wasn't a copper any more. 
Or course, when I opened the agency, you hear things that I would turn 
over to some of the men in the Los Angeles Police Department, who 
took action. 

Mr. Halley. At that time did Bugsy Siegel also have the wire 
service ? 

Mr. RuDiTSKY. My understanding is yes, definitely. 

Mr. Hall£Y. That was after Mickey Cohen had beaten up Russ 
Brophy ? 

Mr. RuDiTSKY. I didn't know anything about that; I was in the 
Army tlien. 

Mr. Halley. Didn't that happen around 1942 ? 

Mr. RuDiTSKY. Perhaps it did. 

Mr. Halley. Siegel had the wire service by the time you got back 
from the service ? 

68958— 51— pt. 10 13 



186 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. RuDiTSKT. Yes. 

Mr. Halley. Where did Dragna fit in at tliat time on the wire 
service ? 

Mr. EuDiTSKY. I didn't know except in a conversation with Al 
Smiley, he mentioned that he and Dragna were to go in a wire service 
or were in a wire service together. That was the only thing. 

Mr, Halley. They were working with Siegel at that time, were they 
not? 

Mr. RuDiTSKY. That is the understanding, yes. 

]Mr. Halley. And there was no warfare that you know of at the 
time ? 

Mr. RuDiTSKY. Not at that time, no. 

Mr. Halley. Then in 1947, after Ragen was killed — he was killed 
in 1946 — Trans- America Wire Service went out of business; is that 
right? 

Mr. RuDiTSKY. That is right. 

Mr. Halley. The Continental crowd stepped right in with Tom 
Kelly running it ; is that correct ? 

Mr. RuDiTSKY. That is right. 

Mr. Halley. They set up the wire service here in Los Angeles \ 

Mr. RuDiTSKY. That is right. 

Mr. Halley. Brophy was back in, was he not ? 

Mr, RuDiTSKY. I didn't know who was in but it was my opinion, 
and from conversations with people, I always said there was going to 
be a break-out, a war over controlling it. 

Mr. Halley. That was because Siegel wanted to keep his control? 

Mr. RuDiTSKY. Yes. 

Mr. Halley. And he did not want to play ball with Continental ? 

Mr. RuDiTSKY. That is right. 

Mr. Halley. Would it be your opinion that that was one of the 
factors contributing to his death ? 

Mr. RuDiTSKY. I definitely do. 

Mr, Halley. Had you heard the story that two gangsters from 
Chicago had come here and talked to Mickey Cohen and Jack Dragna 
and Siegel shortly before Siegel's death ? 

Mr. Ruditsky. I don't think so. My personal opinion was that 
that wasn't a professional job; I don't think they were professional 
triggermen. I think it was somebody from here who has never done 
much of that type of gang war. 

Mr. Halley. Why would it have any connection with the wire 
service? 

Mr. Ruditsky. The wire service was established here already and 
probably, in my opinion, it was a fight for the control of it out here. 

Mr, Halley. What factions were fighting? 

Mr. Ruditsky. I didn't know who the factions were. I didn't know 
anything about the factions, but it was an opinion I established in my 
own mind knowing how the underworld operates, 

Mr. Halley. After Siegel's death, Dragna stepped in ? 

Mr. Ruditsky. I didn't know anything about Dragna. There was 
very little that I knew about Dragna or any of that Siegel crowd. 
The only time up to then that I had seen Siegel — I was in the Army. 
I went in as a private and he was a corporal. He said, "I understand 
you are a New York cop; is there anything I can do for you?" We 
were stationed at Camp Callen and I said, "No, thank you," and that is 



ORGANIZED CRIME IN INTERSTATE COMMERCE 187 

the last I saw of him until about a year after, at the fights one night. 
As I say, I was disinterested except in things where I could help 
people. 

Mr. H ALLEY. You did not think at that time that Mickey Cohen 
would have had a motive in killing Siegel ? 
Mr. RuDiTSKY. I don't think so. 

Mr. Halley. Or Jimmie Utley ? 

Mr. RuDiTSKY. I didn't know anything much about Jimmie Utley; 
just from what I read. I never knew too much about him. 

Mr. Halley. At that time were Siegel and Joe Adonis in some sort 
of a scrap involving Virginia Hill ? 

Mr. RuDiTSKY. Definitely not. 

Mr. Halley. There was a certain rivalry there, was there not? 

Mr. RuDiTSKY. No, I think Joe Adonis was happy to turn her over 
to Siegel. 

Mr. Halley. At that point she had left Siegel and was in France, 
was she not ? 

Mr. RuDiTSKY. At the time of the killing, oh, yes. She is absolutely 
a screwball. I have met her and have known her. I think she is 
psychopathic. 

Senator Wiley. Who is psychopathic ? 

Mr. RuDiTSKY. Virginia Hill. She called me when I had the office 
one time. She called our office one night and she said, "You better get 
over here right away ; I have trouble at the house." I went over there. 
There were three or four ]>eople in there that I didn't know. She was 
sitting there. Al Smiley was there. There was a fellow by the name 
of Swifty Morgan there. They were having dinner. She was there in 
a bathing suit and had a gun in her hand. She said, "I am going to 
kill everybody in the house, the maid, and the Chinese butler, and 
cverybod3^" She said, "They have been stealing and robbing me." 

Well, looking at the woman, when you see her, you know she is a 
definite — definitely a mental case. That was my opinion of her. 

Mr. Halley. You think it was probably the Italian crowd that 
killed Siegel? 

Mr. RuDiTSKY. I think it was a war over the wire service. 

Mr. Halley. Over the wire service. 

Mr. RuDiTSKY. Yes. 

Mr. Halley. Possibly a job from Chicago through the Fischettis? 

Mr. Ruditsky. I don't know whether they were tied up in the wire 
service or not. 

Mr. Halley. What would you say about Tony Accardo ? 

Mr. Ruditsky. I don't know. In the last years I got away from 
that, except what interested me locally, when I could help the local 
authorities, which I have done. In fact, I sort of created a little 
jealousy. The sheriff's office was a little annoyed that I was helping 
the Los Angeles Police Department, who were my friends. I knew 
them, and I was a cop and knew most of them, and I worked with 
them. 

Mr. Halley. You got to the scene of the Siegel shooting, I think, 
before anyone else. 

Mr. Ruditsky. I didn't get there ; my partner did. I got there later. 
When the shooting happened Smiley fell to the floor and she hollered, 
"Put the lights out and call the police." This girl, Geri Mason, who 



188 ORGANIZED CRIME IN INTERSTATE COMMERCE 

was Virginia Hill's secretary — our office had handled her divorce case 
when she was divorced from her husband, for which we haven't been 
paid yet. Not knowing of anything, she called our office, thinking it 
was the police department, and my partner was in the office with one 
of our operators, and they rushed over there. Of course, the Beverly 
Hills police were there bj" that time, but tlie next morning I was called 
by Chief Anderson and Captain AVhite out there. They wanted to 
know the tie-up of the eastern mobs with the mobs out here. I said, 
"Let's go someplace where nobody will know what we are talking 
about." There were a few assistant district attorneys there at the 
time. I suggested going up to my home. I live up in the hills. We 
went up there, and I gave them as honestly as I thought the tie-up of 
the mobs throughout the country, to assist them in sort of getting to 
a motive here. Well, I did; word for word that was in Pegler's 
column. 

The Chairman. You gave it to whom? 

Mr. liuDiTSKY. I gave it to a group of men, the Beverly Hills Police 
Department and the district attorney's office. They didn't even miss a 
comma when it come out in Pegler's column. 

Mr. Halley. You think if the solution to that murder is to be found 
it must be found in the wire-service story ? 

Mr. KuDiTSKY. Yes; and, gentlemen, I can say this to you, as a 
committee, I respect your abilities very much and the work you are 
doing, but I think if you had more confidential reports and statements 
given to you, and kept confidential, I think 3'ou would get a lot more 
help. 

Mr. Halley. Thank you. 

Mr. RuDiTSKY. Because I think — I know the statements made in 
the press, that men were willing to help and would be happy to help, 
but then the information is divulged to the public. I don't say that 
about this committee, but it was done in previous investigations, where 
information is divulged to the public. People don't like to put them- 
selves on the spot. I feel physically able to take care of myself, but 
a lot of people don't feel that way. 

Mr. Halley. Going ahead with the wire-service trouble; at that 
particular time Bugsy was also having a battle about the wire service 
in Las Vegas, was he not? 

Mr. RuDiTSKY. Bugsy Siegel? 

Mr. Halley. Yes. 

Mr. RuDiTSKY. I heard that after his killing. I went up there after 
the killing with some of these checks that we had and we were going 
to turn them back to them. I turned a lot of them over to this Mutual 
Collection Agency because we wanted no part of it. It wasn't profit- 
able enough for us to waste a lot of time on. Then we got a lot of big 
checks that we turned over to them. I heard that he had a lot of prob- 
lems in some of the clubs up there where they put the service in. 

Mr. Halley. Particularly with the Golden Nugget and the Last 
Frontier ? 

Mr. RiTDiTSKY. Yes. There had been trouble up there for a while. 

Mr. Halley. But here locally he was running a wire service in com- 
petition with the Continental Service? 

Mr. RuDiTSKY. That is the information I have. 

Mr. Hali>ey. And Smiley was working on that with him; is that 
right ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 189 

Mr. RuDiTSKY. That is right. 

Mr. Halley. Was Mickey Cohen ever shot at Sherry's, at the res- 
taurant ? 

Mr. RuDiTSKY. Yes. 

Mr. Halley. When was that? 

Mr. RuDiTSKY. Sometime around June or July. I don't really re- 
member the exact date on that. 

Mr. Halley. That was in 1949 when Neddie Herbert was killed, 
was it? 

Mr. RuDiTSKY. The night Neddie Herbert was killed, yes ; that was 
the only time. 

Mr. Halley. On that occasion they clipped Mickey ; is that right ? 

Mr. Rlditsky. That is right. Mickey used to come into the place 
every night and he behaved himself in there and we had no reason 
to order him out. 

Mr. Halley. That was in July, was it not? In June they shot at 
Herbert and missed; isn't that correct? 

Mr. RuDiTSKY. At his home, where he lived; on his way home, I 
should say. 

Mr. Halley. Did they come into Sherry's on that night ? 

Mr. RuDiTSKY. No. Every night that Mickey came in, for the pro- 
tection of my customers I sort of watched the place and walked around 
outside and inside. When he would come out I would walk out and 
tell the parking-lot boys to have the cars ready for him. The parking- 
lot boy was a brother of mine. That night I had to go into the kitchen 
and made a small sandwich for myself. I stood out at the kitchen 
door and when Mickey come out he come out with Neddie and this girl. 
Dee David, and Harry Cooper, the Attorney General Howser man, 
who had been with him every night. I used to talk to Harry every 
night. He was a likable sort of a fellow. This night when they 
come out I walked toward them at the steps. I was there talking to 
Harry Cooper when two cars pulled up ; Mickey's cars. I was facing 
east. Cooper had his head turned to the side and Dee David had her 
back facing south. Mickey was facing south when these shots come. 
They sounded like firecrackers to me. I saw the people falling on the 
sidewalk. I realized then that it was shots from across the street. I 
started across the street. Realizing I had no pistol or anything with 
me, I ran back to my car where I kept one in the glove compartment 
and I started to cross the street. Florabel Muir, of the Mirror and the 
Daily News in New York, she came over with me. I had a big light 
and we started searching around. We found the shotgun slugs there. 
I walked down the stone embankment, the steps there, and the car had 
been on a dead-end street and by that time they backed out and got 
away. I came back and there was a lot of excitement and confusion 
there. We tried to get ambulances and we aided the injured. I stood 
out there in the street thinking it was a real professional job and I 
know they usually come back to finish up anybody they haven't killed. 
So I stood out there with my pistol waiting for anyone to come back, 
and to protect anyone else that was left. 

Senator Tobey, Where was Mickey all the time ? 

Mr. RuDiTSKY. He was hit in the shoulder. 

Senator Tobey. Was he down? 

Mr. RuDiTSKY. This fellow, Frank Niccoli, the missing one, put 
him in his car. He took Harry Cooper and Mickey and clrove them 



190 ORGANIZED CRIME IN INTERSTATE COMMERCE 

to the hospital immediately. The others were on the street. They 
drove down to the hospital. Neddie Herbert and the girl, Dee David, 
they were lying on the sidewalk and we moved them in as fast as 
we conld and got them ont of the way in case of any further trouble. 
They fired, I think, seven blasts. I think it was a 12-gage shotgun 
and they plugged them pretty good. There were holes that size all 
over the wounds. They were down across the street and there was 
an embankment there of about 6 feet with a stairway coming up. They 
laid on the steps. They camouflaged themselves and just lay there. 
It had been a slow night. If it had been a busy night our parking-lot 
boys may have seen them. As they bring the cars down from the park- 
ing lot the headlights would have shined across the road, but it was 
quiet that night and no cars came out. They, apparently, had cased 
the place pretty well. 

Senator Wiley. There were no clues ? 

Mr. EuDiTSKY. As far as I know, no. 

Senator Tobey. What percentage of these bad gambling debts is 
charged off by these groups annually ? 

Mr. RuDiTSKY. That they collect? 

Senator Tobey. That they don't collect? 

Mr. RuDiTSKY. I don't think they collect 90 percent of them. 
People have gotten onto the fact that they are uncollectible. At one 
time these people used to go out and bully them. I think we spoiled 
that by calling on people and being nice ro them. We asked them to 
try and pay a little of it. It is not a violation of the law in this State 
not to pay those, but then you can't go gack to Nevada. 

Senator Tobey. You mean they give a check and it bounces and they 
are not liable ? 

Mr. RuDiTSKY. A lot of them will go up there and play for $100 or 
$200 and lose that. Then they will sign a marker, put it on the rim 
for $500 or $1,000, the house feels if they have lost $200 that they are 
good for more. A lot of them will lose a hundred dollars or so of that 
and then go home with the rest, if they give them a marker for about 
a thousand dollars, so they are in for $800 or $900 and the check is no 
good. 

The CiiAiEMAN. You mean they do not collect 90 percent of the 
amount involved ? 

Mr. RuDiTSKY. They fail to collect 90 percent of their collections ; 
yes. 

Senator Tobey. Only 10 percent is collected? 

Mr. RuDiTSKY. That is about all. That has been proven because 
the people know now they can't do anything to them. There was a 
test case here in this State and that is the way it came out. 

The Chairman. Is there anything else ? 

Senator Tobey. I have no questions. 

Senator Wiley. You were telling about this combination where the 
take was some $21,000,000. Who was really the head of that, do you 
know? 

Mr. EuDiTSKY. That I wouldn't know. I think it is all this eastern 
crowd. I don't think there is a head of it. I think there is just a 
group. 

Senator Wiley. Was there any tie-Up there with the Mafia? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 191 

Mr. RuDiTSKY. I think some of them were in on that. In New York 
you might have Adonis and Tommie Brown and Charley Wliite. 

Senator Wiley. Have you been able to find out whether or not this 
combination was guilty of any violence in any manner whatsoever? 

Mr. RuDiTSKY. As I said, up to 1941 I could tell you of all the 
violence or anything else that happened. After that I sort of disen- 
gaged myself, being that I was not with any law enforcement agency 
and I was a civilian. I just sort of forgot about that. 

Senator Wiley, What I am getting at is: Do you think that any 
killings, like these that have been talked about, that it was sort of an 
internal affair; quarrelling amongst the crowd or is the killing done 
by some outside fellows? 

Mr. RuDiTSKY. There were no killings, unless they were O. K.'ed 
remember that. Today, with the set-up of the mob, at least until 
the time I was in the department, if I w^anted to kill a man and I am 
part of a combination, I have to get the O. K. I kill nobody until I 
get an O. K. 

Senator Tobey. From whom? 

Mr. RuDiTSKY. The powers that be. 

Senator Tobey. Who are the powers that be ? 

Mr. RuDiTSKY. Up until 1941 I could tell j^ou just who they were; 
I know that it is just a combination today. 

Mr. Halley. Let's take what you know. Let's go back to 1941. 

JNIr. RuDiTSKY, In 1941 you had the New York crowd, the Lepkes 
and the Dutch Schultzs and the Siegels and the Lanskys. Today 
you have a new crowd ; that crowd has been eliminated. 

Mr. Halley. Supposing in 1940 or 1941, at about the time when 
Siegel succeeded in muscling into the wire service, somebody had de- 
cided to kill him, who would they clear with? 

Mr. RuDiTSKY. They would have to clear with New York, with 
Lansky, or with Zwillman in Jersey or with Lepke. 

Mr. Halley. Zwillman was supposed to have been up to this point, 
or for many years, in a legitimate business ; is that right ? 

Mr. Ruditsky. Wliat I get now, what I hear now, they are all in 
legitimate businesses now. 

Mr. Halley. But they still have their control over the mob activi- 
ties? 

Mr. Ruditsky. That is right. 

Mr. Halley. Do they get their cut from the mob j^rofits? 

Mr. Ruditsky. Definitely, because the take is so great. 

Mr. Halley. What would you say is the take from one of these 
major gambling establishments? 

Mv. Ruditsky. Throughout the country? 

Mr. Halley. Take the whole combination first. 

Mr. Ruditsky. Well, as I say, I made the statement that they said 
in 1 year they cleared $21,000,000 in four gambling houses. 

Mr. Halley. Who said that ? 

Mr. Ruditsky. That was given to me by different sources that know 
the combination. 

Mr. Halley. Have you ever talked to any of these people about 
income taxes ? 

Mr. Ruditsky. Well, from my experience they take care of that; 
they say they make the guy with the whiskers their partner. They 



192 ORGANIZED CRIME IN INTERSTATE COMMERCE 

don't want to count liim short. Their fear was up when Capone and 
Waxey Gordon were hit; they wanted to pay Uncle Sam. Some of 
them would even pay him a little more. 

Senator Wiley. That is the guy with the whiskers you are talking 
about ? 

Mr. RuDiTSKY. They would rather pay Uncle Sam rather than have 
any trouble. 

Mr. Halley. Supposing you were going to, in 1941, were going to 
kill a member of the Mafia, who would you clear with ? 

]\Ir. RuDiTSKY. They would have to clear with all the mob. At that 
time I would go to a fellow like Lepke, who was the top fellow around 
New York. 

Mr. Halley. He wasn't in the Sicilian Mafia. 

Mr. RuDiTSKY. Well, he no doubt would go to somebody like Adonis 
and clear through him. When Lucky was here at that time he would 
go through somebody like that. If you remember the case with Abie 
Wagner and Charley Brown, if you remember that killing, there was 
a clearing there. They had to be cleared with Charley "Lucky"' Lu- 
ciano before they could kill them. It was a double-crossing, double- 
crossing one another. Abie Wagner and Charley Brown had been with 
Lepke. 

Senator Tobey. Is Lepke still alive? 

Mr. RuDiTSKY. He was electrocuted. 

Mr. Halley. Are the Fischettis top dog in Chicago today ? 

Mr. RuDiTSKY. I don't know. I don't know what the set-up in 
Chicago is. 

Mr. Halley. How did Dragna lose his influence here in the last 
couple of years ? 

Mr. RuDiTSKY. I wouldn't know that either. As I said, I didn't 
know anything about the Dragna or the Sica crowd. They were be- 
fore me. When I got out of the Army I didn't get too interested in 
their movements. 

Mr. Halley. In the last couple of years Dragna seems to have lost 
his influence. 

]\Ir. RuDiTSKY. Well, just from what I have read ; from what I have 
read in the newspapers and that is all. 

Mr. Halley. Do you connect that with the fact that in the last 
2 years Mickey Cohen and his henchmen have been practically targets 
in a shooting gallery ? 

Mr. RuDiTSKY. My honest opinion is that I don't think Cohen — he is 
a gambler and has rackets, whatever they are — but I don't think he is 
any interference for anybody unless the mob is looking to cut in. 

Mr. Halley. Why would anyone knock off Herbert? 

Mr. RuDiTSKY. Neddie Herbert ? 

Mr. Halley. Yes. 

Mr. RuDiTSKY. Probably he is in their way. 

Mr. Halley. And Cohen is in their way too? 

Mr. RuDiTSKY. Yes, of organizing. 

ISIr. Halley. How would he be in somebody's way? 

Mr. RuDiTSKY. The modus operandi of a mob, when they get into 
a town, they have to clear it with somebody in power. If that one in 
power refuses to give them the O. K. they have to fight it out. That 
was my opinion when they tried to eliminate Mickey Cohen. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 193 

Senator Tobey. Is there a power behind Mickey Cohen, do you 
think? 

Mr. RuDiTSKY. I don't think so. 

Senator Tobey, He is not a fellow of any outstanding ability, 
is he ? 

Mr. RuDiTSKY. No, I think he is just a rough, tough little guy who 
said, "I have got this and I am going to hold onto it." 

Mr. Haixey. Do you think Frank Milano might be keeping the 
Italian mob from finishing him off? 

Mr. RuDiTSKY. That might be a possibility because Mickey at one 
time was very friendly with Milano's wife. They used to come in to- 
gether in a party when they came into Sherry's at one time. 

Senator Wiley. You have just intimated that the modus operandi 
of all this killing, that there has to be a clearing with someone higher 
up. You have also suggested in relation to Mickey Cohen that there 
is a possibility that someone is trying to muscle in and he is in the 
way. 

Mr. Ruditsky. He is known, in the parlance of the underworld, as 
an outlaw. The same as Jack Diamond ; back East he was an outlaw. 
They were not with the syndicate. They are outlaws and anybody can 
come in and take over where they are. 

Senator Tob-ey. You are talking about "Legs" Diamond? 

Mr. Ruditsky. Yes ; he was an outlaw. He was killed. 

Senator Wiley. Well, I have had a difficult time trying to follow 
your testimony. Is it your opinion that the various attempts on the 
life of Mickey Cohen was the result of someone from outside trying 
to muscle in ? 

Mr. Ruditsky. In my opinion, I believe that is so ; yes. I believe 
that he is an outlaw and not with a syndicate ; that somebody is trying 
to muscle in. 

The Chairman. This book that you have written, this manuscript, 
when did you write that Angel's Corner? 

Mr. Ruditsky. In 1941, just before I got in the Army, and finished 
it while in the Army. 

The Chairman. Haven't you been able to get it published? 

Mr. Ruditsky. We haven't tried very hard. 

The Chairman. What are you going to do with the manuscript ? 

Mr. Ruditsky. We are holding it and hoping to do some television 
shots with it. I wrote that with Morton Moss of one of the local 
papers. 

The Chairman. If there is nothing further we will excuse the 
witness. 

Senator Tobey. I have nothing further. 

Mr. Halley. Nothing further. 

Senator Wiley. Nothing further. 

The Chairman. Thank you very much for coming in. You have 
made a sworn statement before, have you? 

Mr. Ruditsky. Yes. 

The Chairman. All right, that will be all. 

(Witness excused.) 

The Chairman. The next witness will be Michael Cohen. His 
testimony will be taken in an open session. 

(The following proceedings were had in open session :) 



194 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chaikman. Mr. Cohen, will you come around and be swoni. 

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 ? 

Mr. Cohen. I do. 

TESTIMONY OF MICHAEL (MICKEY) COHEN, LOS ANGELES, CALIF., 
ACCOMPANIED BY WILLIAM STRONG AND BENJAMIN F. 
SCHWAETZ, ATTORNEYS, BEVERLY HILLS, CALIF. 

The Chairman. I think Mr. Cohen is represented by some attorneys. 
You, sir, are Mr. Cohen's attorneys, are you ? 

Mr, Strong. My name is William Strong. 

The Chairman. Will someone take Mr. Cohen's hat, unless you 
want to put your hat in the ring, Mr. Cohen. 

Mr. Cohen. No, sir. 

The Chairman. What is your address, Mr. Strong ? 

Mr. Strong. Here is my card. 

The Chairman. William Strong of the firm of Strong and Schwartz, 
attorneys at law, 9441 Wilshire Boulevard, Beverly Hills, Calif. 

Mr. Strong. This is Mr. Schwartz, my partner. 

Mr. Schwartz. My name is Benjamin F. Schwartz. 

The Chairman. Very well. Before proceeding, I want to admonish 
our guests here that jou are the guests of the committee. We do not 
want any demonstrations or any approval or disapproval of anything 
that is said or done. Also try to keep as quiet as possible and no 
smoking by the committee or by anyone else in the court room during 
the hearing. 

Mr. Cohen, you are well represented by your attorneys, Mr. Strong 
and Mr. Schwartz, but as chairman of this committee, with also Sen- 
ators Tobey and Wiley being present, I think we should advise you of 
your constitutional rights. I am sure that your attorneys have. 

That is, that you may object to answering any question, which the 
chairman of the committee will rule upon, which you feel would tend 
to incriminate you of any Federal offense. That does not apply, and I 
am sure that your attorneys have advised you, to anything that might 
tend to incriminate you of a State offense. 

That will be the ruling of the chairman, in the event he refuses to 
answer any question. 

All right, Mr. Halley, proceed with the examination. 

Mr. Halley. What is your full name ? 

Mr. Cohen. Michael Cohen. 

Mr. Halley. What is your address? 

Mr. Cohen. 513 Moreno, West Los Angeles. 

Mr. Halley. Do you have a business ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Wliat is that business ? 

Mr. Cohen. A tailoring shop. 

Mr. Halley. What is the address? 

Mr. Cohen. 9649 Santa Monica Boulevard, Beverly Hills. 

Mr. Halley. What is the name of the establishment ? 

Mr. Cohen. A1 Pignola. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 195 

Mr. Halley. Would 3^011 not have known the name of the establish- 
ment without referring to the card that you have? 

Mr. Cohen. No, I know it. I just didn't know the address offhand. 
I know the place but I don't go there too much. 

Mr. Halley. Do you have any other business ? 

Mr. Cohen. Not at this time; no. 

Mr. Halley. Have you ever been arrested ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. When, and where, and for what? 

Mr. Cohen. I couldn't remember all of them. 

Mr. Halley. Were you arrested in 1933 for suspicion of robbery? 

Mr. Cohen. Yes, sir, I think so. Many times I have been arrested 
for sus])icion of robbery. 

Mr. Halley. Can you remember the times you have actually been 
convicted ? 

Mr. Cohen. Never convicted. 

Mr. Halley. Never once in j^our life convicted ? 

Mr. Cohen. I have been convicted of a charge in Cleveland, Ohio, 
but I was restored to my full citizenship and was told to answer that 
I had never been convicted, by the judge. 

Mr. Halley. Will you tell the committee the full facts ? 

Mr. Strong. Of the conviction or the charge or what ? 

Mr. Halley. With what w^ere you charged ? What was the offense 
of which you were convicted; where and wdien and when were you 
pardoned ? 

Mr. Cohen. I was a prizefighter at the time. There were just a 
couple of kids training me, and myself, and some fellow that owned a 
restaurant, that was the manager of a restaurant, and he gave us a 
proposition of going into this restaurant and he would hand us some 
money. It was one of those kid things that you get involved in. 

Mr. Halley. What was the charge ? 

Mr. Cohen. They charged us with embezzlement. 

Mr. Halley. How much money was involved? 

Mr. Cohen. Oh, I think about $1,200 or $1,400. 

Mr. Halley. What year was that? 

Mr. Cohen. I don't know. 

Mr. Halley. That was while you were in Cleveland ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. Was Frank Niccoli involved in that with you ? 

Mr. Cohen. That is right, that is the fellow involved. 

Mr. Halley. He later came here to Los Angeles with you ? 

Mr. Cohen. That is right; yes. 

Mr. Halley. He is now missing? 

Mr. Cohen. That is right; yes. 

Mr. Halley. He has disappeared? 

Mr. Cohen. That is right, sir. 

Mr. Halley. Were you ever convicted in Los Angeles ? 

Mr. Cohen. Of bookmaking. 

Mr. Halley. How many times for bookmaking? 

Mr. Cohen. One time. 

]Mr. Halley. Wlien was that? 

Mr. Cohen. I would say around 10 years ago. 

Mr. Halley. Were you ever convicted of any other offense? 



196 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. No, sir. 

Mr, Halley. Were you convicted of administering a beating to 
Russell Brophy? 

Mr. Cohen. No, sir. 

Mr. Halley. "Were you not fined for that offense, you and Sica? 

Mr. Cohen. Yes, sir ; I don't remember the true outcome of the case. 
I think there was a fine ; that is right. 

Mr. Halley. That was a conviction, was it not? 

Mr. Cohen. I imagine so; I didn't think of it. 

Mr. Halley. Are there any other convictions? Try to think of 
them all now, Mr. Cohen. 

Mr. Cohen. I don't even know the true outcome of the Brophy case. 
I can't recall that. Was there a fine with it? You })robal)ly have 
the record. 

Mr. Halley. Let's start at the beginning. Russell Brophy managed 
the wire service here in Los Angeles ; is that right ? 

Mr. Cohen. That is right. 

Mr. Halley. Giving racing wire service to bookies? 

Mr. Cohen. That is right. 

Mr. Halley. You and Joe Sica entered his place and beat him up ; 
isn't that correct ? 

Mr. Cohen. There was some kind of a thing there ; yes. 

Mr. Halley. Let's not quibble about it. You and Sica beat him up 
pretty badly, didn't you ? 

Mr. Cohen. That is right ; yes. 

IMr. Halley. You were brought before a court on charges of that, 
were you not ? 

Mr. Cohen. That is right. 

Mr. Halley. Do you recall that Sica was fined $200 and you were 
fined $100? 

Mr. Cohen. I think that is right ; yes. 

Mr. Halley. You do recall it now ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Who hired you to do that beating ? 

Mr. Cohen. Nobody. 

Mr. Halley. Did you have any connection with the wire service at 
that time ? 

Mr. Cohen. No, sir. 

Mr. Halley. When else were you ever convicted ? 

Mr. Cohen. That was the only time, that there time and the time 
in Cleveland and the bookmaking time. 

Mr. Halley. Were you ever convicted in Chicago? 

Mr. Cohen. No, sir. 

Mr. Halley. You lived in Chicago, did you not ? 

Mr. Cohen. That is right, yes. 

Mr. Halley. You left Chicago under a cloud, did you not ? 

Mr. Strong. What is a "cloud," Mr. Counsel ? 

Mr. Halley. You were forced to leave Chicago, were you not ? 

Mr, Cohen. No, sir. 

Mr. Halley. Were you ever arrested in Chicago ? 

Mr. Cohen. Yes. sir. 

Mr. Halley. Were you ever arrested in New York ? 

Mr. Cohen. New York, no, sir. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 197 

Mr. Halley. Now, I liave here a criminal record and I will go down 
the list of yonr arrests with yon, Mr. Cohen, and will you please state 
whether or not the record is accurate in each case. 

I have here an arrest in 1933, July of 1933, for suspicion of robbery. 
Do you recall that ? 

Mr. Cohen. I can't recall the dates. 

Mr. Halley. That would be in Cleveland. 

Mr. Cohen, I don't recall the date. 

Mr. Halley. In 1934 • 

The Chairman. Just a minute, please. Regardless of the date, 
about that time were you arrested for suspicion of robbery in Cleve- 
land? 

Mr. Cohen. It is possible, sir, but I know the time or the dates. I 
have been arrested for suspicion of robbery 20 or 30 times. 

The Chairman. We are not holding you to the exact date. Ap- 
proximately, in the middle of 1933, were you arrested for the suspicion 
of robbery in Cleveland ? 

Mr. Cohen. It is probably so if it is on the record; I don't know. 
I couldn't answer truthfully and tell you I do know if I don't. 

Mr. Halley. You were arrested so often on suspicion of robbery 
that the particular date that I have mentioned would elude you? 

Mr. Cohen. There is a law in Los Angeles, that every time they 
arrest you on suspicion, it is on the suspicion of robbery. 

Mr. Halley. Do they have the same law in Cleveland, too, when- 
ever tliey pick you u\)'^. 

Mr. Cohen. Possibly so. 

Mr. Halley. Everybody who is picked up is charged with suspicion 
of i-obbery ? 

Mr. Cohen. If you are picked up for any kind of a thing, yes. 

Mr. Halley. You don't mean that, do you ? 

Mr. Cohen. That is the ruling here, jes. 

Mr. Halley. You have been picked up for embezzlement ; you have 
been picked up for bookmaking; you have been picked up just on 
suspicion, and you have been picked up for conspiracy. You have also 
been picked up for murder. Why do you say whenever you are picked 
up, you are picked up on suspicion of robbery ? 

Mr. Cohen, Because I have been picked up 20 or 30 times on sus- 
picion of robbery. 

Mr. Halley. In some of those cases there was a basis for the 
suspicion, was there not ? 

Mr. Cohen. Not to my knowledge. 

Mr. Halley. The next time you were picked up, according to your 
record, in 1934, was in Cleveland for embezzlement. I believe that 
is the charge on which you were convicted, as you testified; is that 
right ? 

Mr. Cohen. That is right, yes. 

INlr. Halley. You received a suspended sentence of 2 years ; is that 
right ? 

Mr. Cohen. I think so ; yes, sir. 

Mr. Halley, Then you were pardoned? 

Mv. Cohen. That is right, yes. 

JVIr, Halley, Who pardoned you ? 

Mr. Cohen, The judge that sentenced me. That is to the best of my 
knowledge, yes. 



198 ORGANIZED CRIME IN INTERSTATE COMMERCE < 

Mr. Halley. The judge that sentenced you, pardoned you? 

Mr. Cohen. That is to the best of my knowledge, yes. 

Mr. Halley. Mr. Cohen, where were you born ? 

Mr. Cohen. In New York City. 

Mr. Halley. When? 

Mr. Cohen. In 1916, I think. 

Mr. Halley. 1916? 

Mr. Cohen. No; I don't remember. 

Mr. Halley. How old are you? 

Mr. Cohen. Thirty-seven. 

Mr. Halley. You are 37? 

Mr. Cohen. Yes. 

Mr. Halley. Then you were born in 1913. 

Mr. Cohen. That is right; yes, 1913. 

Mr. Halley. And you were born in New York City ? 

Mr. Cohen. Yes. 

Mr. Halley. How long did you live there ? 

Mr. Cohen. Oh, I guess around 4 years. 

Mr. Halley. From New York City where did your parents take 
you? 

Mr. Cohen. To Los Angeles. 

Mr. Halley. You have been here since 1917 ? 

Mr. Cohen. Off and on; yes. 

Mr. Halley. When did you first leave Los Angeles for any extended 
period ? Perhaps we can help you this way : Were you educated in 
Los Angeles ? Did you go to school here ? 

Mr. Cohen. I only went through a few grades in school. 

Mr. Halley. Just a few grades in school? 

Mr. Cohen. That is right. 

Mr. Halley. Then what did you do? 

Mr. Cohen. Then I became a prize fighter. 

Mr. Halley. How long were you a prize fighter ? 

Mr. Cohen. About 9 years. 

Mr. Halley. You traveled, I presume, a good deal while you were 
a prize fighter? 

Mr. Cohen. That is right. 

Mr. Halley. Then you went to live in Cleveland ? 

Mr. Cohen. I lived in Cleveland for around 4 or 5 years; I boxed 
around there. 

Mr. Halley. During what period of time? 

Mr. Cohen. Well, that is about 17 years ago; 16 or 17 years ago. 

Mr. Halley. About 1933 or 1934? 

Mr. Cohen. That would be about right ; yes. 

Mr. Halley. And you fought a considerable amount in the Cleve- 
land area? 

Mr. Cohen. That is right ; 32 main events. .^ 

Mr. Halley. Thirty-two main events? 

Mr. Cohen. Yes. 4- . 

Mr. Halley. What weight did you fight? 

Mr. Cohen. I started as a flyweight. 

Mr. Halley. Were you pretty good? 

Mr. Cohen. Not too good. 

Mr. Halley. How long did you fight ; for how many years ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 199 

Mr. Cohen. About 9 years. 

ISIr. Halley. P'rom Cleveland where did you go? 

Mr. Cohen. To Chicago. 

Mr. Halley. To Chicago ? 

Mr. Cohen. Yes. 

Mr. Halley. How long did you live in Chicago? 

Mr. Cohen. Around 6 or 7 years ; about 6 years, I think. 

Mr. Halley. You left Chicago about 1939 ? 

Mr. Cohen. I think that would be right, yes. 

Mr. Halley. And you came back to Los Angeles ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. When you lived in Chicago, what was your business? 

Mr, Cohen. Well, I originally was boxing around Chicago. From 
being a boxer, I went into some of the gambling businesses. 

Mr. Halley. You went into the gambling business in Chicago ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. Then in 1939 you came here ? 

Mr. Cohen. That is right; yes. 

Mr. Halley. And you went into the gambling business here ; is that 
right ? 

Mr. Cohen. I done some gambling around here ; yes, sir. 

Mr. Halley. You say you have done some gambling ? 

Mr. Cohen. Yes. 

Mr. Halley. Wasn't it your major business here? 

Mr. Cohen. At one time, yes ; not today. 

Mr. Halley. We will talk about today later, if you please. 

Now, getting back to your arrests, so we can fit it into the time table 
that we have built. In 1939, on your return here in November, were 
you arrested again on suspicion of robbery ? 

Mr. Cohen. I think I was. I don't remember. I can't remember 
the times. 

Mr. Halley. In 1940 were you arrested again? 

Mr. Cohen. Possibly so. 

Mr. Halley. Was that the occasion, do you recall, of having been 
arrested at 6336 Orange Drive with Joe Sica on a charge of 
prostitution ? 

Mr. Cohen. Prostitution ? 

Mr. Halley. Yes ; with a lady. 

Mr. Cohen. Not me. 

Mr. Halley. Did you live at 6336 Orange Drive ? 

Mr. Cohen. I don't know if I did or not; I don't think so. 

Mr. Halley. Do you know where Orange Drive is ? 

Mr. Cohen. Not offhand, no. 

Mr. Halley. You would not know offhand whether you lived on 
Orange Drive or not ? 

Mr. Cohen. I can't recall. 

Mr. Halley. You do not recall being arrested in 1935 with Joe 
Sica in an apartment with a prostitute? 

Mr. Cohen. No. 

Mr. Halley. For residing there and not for just visiting with this 
prostitute ? 

Mr. Cohen. No ; I don't recall it. 

Mr. Halley. But it is possible, is it ? 



200 ORGANIZED CRIME IN INTERS! iTE COMMERCE 

Mr. Cohen. I don't think it is even iDOSsible. I don't remember it. 

Mr. Halley. Would you contest the police record ? 

Mr. Cohen. I don't understand you. We were arrested in an apart- 
ment, you say ? 

Mr. Halley. Yes. 

Mr. Cohen. And we were charged with prostitution ? 

Mr. Halley. Yes. 

Mr. Cohen. That is untrue. 

Mr. Halley. That is mitrue ? 

Mr. Cohen. Yes. 

Mr. Halley. You were charged with maintaining the prostitute 
there. 

Mr. Cohen. That is absolutely untrue. 

Mr. Halley. Is that right ? That is untrue, you say ? 

Mr. Cohen. To the best of my knowledge it isn't true, yes. 

Mr. Halley. Then you were arrested on two occasions in 194:0 for 
suspicion ? 

Mr. Cohen. That there other case there, was that a case that we 
went to trial on, you say ? 

Mr. Halley. Apparently not. You were picked up and released. 

Mr. Cohen. I can't tell what officers will charge you with ; they can 
cliarge you with anything. 

Mr. Halley. It was not suspicion of prostitution. 

Cohen was found residing at 6336 Orange Drive with a prostitute and Joe 
Sica was sleeping in the bacli room of the same apartment. 

That is what the record states. 

Mr. Cohen. I have never been with a prostitute. 

Mr. Halley. Then the record is wrong ? 

Mr. Cohen. The charge is wrong. 

Mr. Halley. There was no conviction on it. I am simply asking 
you if you were charged with that. 

Mr. Cohen. I don't know if I was charged with that; if I was 
charged with it, it is absolutely wrong. 

Mr. Halley. Your denial stands on the record, Mr. Cohen. 

Mr. Cohen. That is right. 

Mr. Strong. He is saying he doesn't know. 

Mr. PIalley. He denies it happened. 

Mr. Strong. He does not know what the police gave as the reason 
for the arrest. 

The Chairman. Will you direct your objections to any questions to 
the committee and I think we will get along better that way. 

Mr. Strong. Yes, sir. I will have very few objections. 

Mr. Halley. You were arrested twice on suspicion in 1940 ; is that 
right ? 

Mr. Cohen. I can't answer that. I don't know truthfully if I was 
or not. 

Mr. Halley. But it could have happened? 

Mr. Cohen. It could have ; yes, sir. 

Mr. Halley. Then in 1941 do you recall having been arrested for 
bookmaking in Los Angeles? 

Mr. Cohen. 1941 ; I think that is right. 

]\Ir. Hali>ey. And again in 1942 for bookmaking; woidd that be 
right ? 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 201 

Mr. Cohen. I only recall once being arrested for bookmaking and 
being convicted of it. 

Mr. Halley. When was that conviction, do you recall ? 

Mr. Cohen. I think it was about 10 years ago. 

Mr. Halley. Do you recall being arrested on a felony warrant in 
1942? 

Mr. Cohen. No, sir. 

Mr. Halley. In July of 1942? 

Mr. Cohen. I do not. 

Mr. Halley. Could that have been the occasion when yon were 
arrested in San Pedro in connection with the charge of assault on 
Russell Brophy? 

Mr. Cohen. I was never arrested in San Pedro. 

Mr. Halley. You were never arrested in San Pedro ? 

Mr. Cohen. To the best of my knowledge, I was never arrested in 
San Pedro. 

Mr. Halley. Where was the assault on Brophy? Here in Los 
Angeles ? 

Mr. Cohen. There was no assault, really ; it was just an argument. 

Mr. Halley. Two of you hit him ; isn't that what happened ? 

Mr. Cohen. I know I hit him. I don't know who else hit him. I 
know I hit him. 

Mr. Halley. Joe Sica hit him, too, didn't he ? 

Mr. Cohen. I don't know ; I know I hit him. 

Mr. Halley. The court apparently did think you both hit him ; you 
were fined $100 and he was fined $200. 

Mr. Cohen. Then I must have hit him less. 

Mr. Halley. Then it appears that Sica hit him, too. 

Mr. Cohen. I imagine so if he got fined. 

Senator Wiley. Did you get your money's worth ? 

ISIr. Halley. That would not be the same charge, because that was 
in September of 1942 and I see that in July of 1942 you were arrested 
for a felony and then dismissed, on a felony warrant. Do you recall 
that? 

Mr. Cohen. In San Pedro, are you talking about ? 

Mr. Halley. No ; in Los Angeles. 

Mr. Cohen. It could be so, but I don't remember the f)articular 
incident. 

Mr. Halley. In connection with the Brophy case, you were also 
charged in September of 1942 with injuring telephone wires; is that 
right? 

Mr. Cohen. I think that is right. 

Mr. Halley. Now, in 1943, do you recall having been charged with 
maintaining a crap game? 

Mr. Cohen. In 1943? 

Mr. Halley. Yes. 

Mr, Cohen. Where was it at ? 

Mr. Halley. In Los Angeles, 

Mr, Cohen, I think that is right, 

Mr, Halley, Did you maintain a crap game in 1943, in Los 
Angeles ? 

Mr, Cohen. I did ; yes, 

68958— 51— pt. 10 14 



202 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. In 1944, were you arrested for vagrancy in Los 
Angeles ? 

Mr. Cohen. I think that is right, 

Mr. Halley. In 1945, were you arrested in the month of May on 
suspicion of murder? 

Mr. Cohen. 1945? 

Mr. Halley. Yes ; May of 1945. 

Mr, Cohen. I think that is right. 

Mr. Halley. Was that the occasion in which Max Shaman was 
killed in Los Angeles? 

Mr. Cohen. I think it may be. 

Mr. Halley. You were charged with the killing ; is that right ? 

Mr. Cohen. That is right; yes. 

Mr. Halley. You claimed that you had killed him but that it was 
in self-defense? 

Mr. Cohen. That is true. 

Mr. Halley. The district attorney's office sustained your conten- 
tion of self-defense and the charge was dropped; is that right? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. The murder — the homicide, pardon me — took place in 
a store that you operated, is that right, called the Paint Shop? 

Mr. Cohen. That is right ; yes. 

]\Ir. Halley. That was a boolvinaking establishment, was it not ? 

Mr. Cohen. It was a paint shop and a bookmaking establishment. 

Mr, Halley, The paint shop was a front for the bookmaking, 
wasn't it ? 

Mr. Cohen. I decline to answer that on the ground it may incrimi- 
nate me. 

Mr. Halley. I will ask the Chair to rule. I believe there is no 
Federal offense involved. 

The Chairman. You are directed to answer that question. 

Mr, Strong. May I ask one question, Mr. Chairman ? 

The Chairman. Very well. 

Mr. Strong. I would like to get the procedure straight. Does he 
have to repeat after you direct him to answer, does he have to repeat 
that he declines to answer on the ground that it would tend to incrimi- 
nate him? 

The Chairman. He either answer the question or repeats that he 
refuses to answer. 

Mr. Strong, Do you understand that ? 

Mr. Cohen. I must repeat that I decline to answer ? 

Mr. Strong. Yes, or answer the question. 

Mr. Cohen. Can I have the question again ? 

Mr. Halley. I think we can simplify it, Mr. Cohen. 

The Chairman. Let us get the question and get a ruling on it. 

Mr. Reporter, will you read the question ? 

(Question read.) 

The Chairman. The Chair directs you to answer the question. 

Mr. Cohen. Well, I wouldn't say. Senator, that it was a front. 
There was a paint business going on in there but there was also book- 
making going on in there. 

The Chairman. Proceed. 

Mr. Cohen. That wi uld be the true answer. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 203 

Senator Wiley. Did the paint business pay or did the bookmaking 
pay? 

Mr. Cohen-. They both paid. 

Senator Wiley. What percentage ? 

Mr. Cohen. I wouldn't know ; I don't know that, sir. 

The Chairman. The bookmaking was the big business and the paint 
business was the Httle business ; is that right ? 

Mr. Cohen. The bookmaking was a good business, yes. 

Senator Wiley. One horse and one rabbit and a sausage ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. What happened on that occasion ? Did Shaman come 
in and attack you ? 

Mr. Cohen. That is true. 

Mr. Halley. Were you armed ? 

Mr. Cohen. I wasn't armed, no. 

Mr. Halley. How did you kill him ? 

Mr. Cohen. There was a gun in the desk. 

Mr. Halley. Was it your desk? 

Mr. Cohen. Yes. 

Mr. Halley. You pulled out the gun and shot him ? 

Mr. Cohen. When I was attacked, yes, that is right. He had a 
gun also. 

Mr. Halley. He pulled his gun first? 

Mr. Cohen. That is right. He came in with his gun. 

Mr. Halley. Wliy did he want to kill you? Did he say anything? 

Mr. Cohen. Why did he want to kill me? 

Mr. Halley. Did he make any statements to indicate or call your 
name or accuse you of something as he came in with the gun ? 

Mr. Cohen. He just started an argument. He just started a tussle. 

Mr. Halley. Had you had previous dealings with him ? 

Mr. Cohen. Not with him, no. 

Mr. Halley. Wliy did he pick you out to kill? 

Mr. Cohen. I had a fist fight with his brother. 

Mr. Halley. How long previous to that? 

Mr. Cohen. About 5 or 6 days. 

Mr, Halley. What was the subject of the fist fight ? 

Mr. Cohen. I really don't know; it was just an argument and he 
took it up. 

Mr. Halley. Did you win the fist fight ? 

Mr. Cohen. I think so. 

Mr. Halley. You beat his brother up pretty badly, did you not? 

Mr. Cohen. I won the fight. 

Mr. Halley. Was his brother a professional fighter, too? 

Mr. Cohen. No, but he was a much bigger man than myself. 

Mr. PI alley. But you were a trained professional athlete? 

Mr. Cohen. Not now I am not : I was. 

Senator Wiley. Was there a trial in that case? 

Mr. Cohen. No, there was no trial, I don't think. 

Mr. Halley. You w^ere never charged with assault for beating up 
Shaman's brother, were you ? 

Mr. Cohen, No, it was just an argument ; just a fist fight. There 
was no assualt. 

Mr. Halley. Was it an argument like the argument with Brophy? 



204 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. Similar, the same sort of argument, yes ; just a personal 
argument. 

Mr. Halley. The Brophy thing wasn't a personal argument, was it ? 

Mr. Cohen. It was a personal argument. 

Mr. Halkey. You and Sica went into this man's place, ripped out 
the telephones, and beat him up ; isn't that right ? 

Mr. Cohen. That is right. 

Mr. Halley. What was personal about that? 

Mr. Cohen. It was a personal argument. 

Mr. Halley. It was a business argument, was it not? 

Mr. Cohen. It was no business argument. 

Mr. Halley. It had to do with whether Brophy was to continue to 
have the wire service in Los Angeles, did it not? 

Mr. Cohen. No, sir. 

Mr. Halley. Wliy did you rip out the telephones ? 

Mr. Cohen. I don't know; I never ripped the phones out myself. 

Mr. Halley. Were you just mean ? Did you just rip out the phones 
to be mean about it ? 

Mr. Cohen, Probably so ; just an argument. 

Mr. Halley. Of course, Brophy went out of the wire service busi- 
ness right after that, you know that, don't you ? 

Mr. Cohen. I don't think he did, 

Mr. Halley. Oh, yes, he did. 

Mr. Cohen. I don't remember him going out of the business. 

Mr. Halley. He got out, didn't he ? 

Mr. Cohen. I didn't know that; I didn't think he did. 

Mr. Halley. Does that surprise you ? 

Mr. Cohen. Yes, it does. 

Mr. Halley. What was the argument with Brophy about, if it was 
a personal one ? 

Mr. Cohen. I really don't recall tlie full argument, what it was all 
about. It was just some personal differences, that is all. 

Mr. Halley. What were they about ? 

Mr. Cohen. I don't know. I think I wanted some service and he 
refused to give it to me, or something like that. I don't recall exactly. 

Mr. Halley. Why did you have Sica with you ? 

Mr. Cohen. Sica and I were together at the time. We were very 
close friends. 

Mr. Haijl,ey. Were you in business together? 

Mr. Cohen. No. 

Mr. Halley. He just came along to help you argue ? 

Mr. Cohen. I think that was it, yes. 

Mr. Halley. And Brophy had refused to give you wire service ? 

Mr. Cohen. He refused to give me some service. He refused to 
serve me with the service or something like that ; I don't recall the 
exact argument. 

Mr. Halley. So you beat him up ? 

Mr. Cohen. One word led to another and we had an argument. 

ISIr. Halley. He went to the hospital, didn't he? 

Mr. Cohen. I think that is right. 

Mr. Halley. Do you know Jack Dragna ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Did you see Jack Dragna before you went to have an 
argument with Brophy? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 205 

Ml-. Cohen. No, sir. 

Mr. Halley. Now, we have just covered May of 1945, when you were 
arrested in connection with the shooting and killing of Max Shaman. 
In November of 1945, were you in trouble again on suspicion of 
robbery ? 

Mr. Cohen. I can't answer that; I don't know. I think so. There 
were many times that I was pinched for that. 

Mr. Halley. In January of 1946 were you arrested again on 
suspicion ? 

Mr. Cohen. If it is on the police record, it is possibly so ; I can't 
remember the dates. 

Mr. Halley. You don't want to contest the police records, in any 
eveiit, do you? 

Mr. Cohen. I do not want to contest the police record on one of those 
things. 

Mr. Halley. And you made it clear for the record on the one 
you do want to protest ? 

Mr, Cohen. That is right. 

Mr. Halley. But on this you do not? 

Mr. Cohen. On the amount of pinches ? 

Mr. Halley. That is right. 

Mr. Cohen. No, I guess they know the number of times they pinched 
me ; I don't know. 

Mr. Halley. In May of 1946, was a man named Pauley Gibbons 
killed? 

Mr. Cohen. I have read about it in the papers ; yes. 

Mr. Halley. He was in the bookmaking business, too ; was he not ? 

Mr. Cohen. I don't know ; I didn't know his business. 

Mr. Halley. Were you in the bookmaking business in May of 1946 ? 
You do remember vou were in it in May of 1945 whr>n Shaman was 
killed. 

Mr. Cohen. In 1946, 1 think so ; yes. 

Mr. Halley. AVere you expanding your business at about that time ? 

Mr. Cohen. Expanding? 

Mr. Halley. Your bookmaking business. 

Mr. Cohen. I wouldn't say I was expanding. 

Mr. Halley, Were you covering a little more territory than you had 
in the past? 

Mr, Cohen. I never done no business locally, if that is what you 
mean, 

Mr. Halley. You explain what you mean, if you please. 

Mr. Cohen. My business wasn't done locally. 

Mr, Halley, How was it done? 

Mr, Cohen. Over the telephone. 

Mr. Halley, Where did you get your customers ? 

Mr, Cohen, I done business with different offices, 

Mr. Halley, Different bookmakers? 

Mr, Cohen. Yes. 

Mr, Halley. They laid off their bets with you ; is that what you 
mean ? 

Mr, Cohen. I moved some money for them and I laid some bets off 
with them, 

Mr. Halley. Did you have any customers or bettors yourself ? 



206 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. No. 

Mr. Halley. In other words, you were a bookie's bookie; is that 
right? Your customers were the bookies? 

Mr. Cohen. That is right ; yes ; offices. 

Mr. Halley. Weren't you attempting to get more customers during 
the year 1946, spreading out into new territory for more bookies ? 

Mr. Cohen. I never had no customers. 

Mr. Halley. You had no customers in Los Angeles ? 

Mr. Cohen. No. 

Mr. Halley. Or in Los Angeles County ? 

Mr. Cohen. None whatsoever. 

Mr. Halley. That is a very broad statement, Mr. Cohen, and you 
are under oath. Would you say that you never had a customer from 
whom you accepted a bet in Los Angeles City or Los Angeles County ? 

Mr. Strong. May I ask, are you referring to customers other than 
the bookies he testified about? 

Mr. Halley. I am tryinrr to get the facts, and if you will bear with 
us I think we will get the facts straight. 

Mr, Cohen. You mean if I ever took a bet from anybody in the city 
or in the county ? 

Mr. Halley. Surely. 

Mr. Cohen. I couldn't say that I have never taken a bet from any- 
body in the city or the county, but I never had them as customers. 
Somebody may haA^e gotten a tip on a horse and asked me to take 
a bet off them or something like that as a favor, but I have never had 
them as customers. 

Mr. Halley. Who were your customers? 

Mr. Cohen. Different offices throughout the country. 

Mr. Halley. Where? 

Mr. Cohen. In Boston, in West Palm Beach, and in Florida, 

Mr. Halley. With whom did you deal in Boston ? 

Mr. Cohen, A fellow by the name of Paladino. 

Mr. Halley. What is his first name ? 

Mr. Cohen. Rocky. 

Mr. Halley. What year was he a customer of yours ? 

Mr. Cohen. You wouldn't call him a customer. They were not like 
customers. He would call me on a horse and I would move some 
money for him and maybe bet some money on the horse myself. 

Mr. Halley. You were talking about customers. I am asking you 
about your customers. 

Mr. Cohen. You can't call these offices customers. 

Mr. Halley. You used the word, I believe. 

Mr. Strong. No ; you used it. 

Mr. Halley. Didn't you have any customers ? 

Mr. Cohen. No; no customers; I didn't deal with private indi- 
viduals. 

Mr. Halley. Who came into the paint store to make bets with you ? 

Mr. Cohen. Nobody. 

Mr. Halley. They would all call on the telephone ? 

Mr. Cohen. That is right. 

Mr. Halley. From whom would they come? 

Mr. Cohen. Who the bets would come from, you mean ? 

Mr, Halley. Yes. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 207 

Mr. CoHEN". From different offices. 

Mr. Halley. Around the country ? 

Mr. Cohen. Who I happened to be doing business with at that time, 

Mr. Halley. Wlio are the offices you were doing business with ? 

Mr. Cohen. One was Jay Copeland. 

Mr. Halley. Where is he ? 

Mr. Cohen. Pie is dead. 

Mr. Halley. Where was he? 

Mr. Cohen. San Francisco. You are talking about that particular 
time in the paint shop ? 

Mr. Halley. Yes. 

Mr. Cohen. Jay Copeland. I did business with an office in New 
Jersey. 

Mr. Halley. With Frank Erickson ? 

Mr. Cohen. No; the name was Eogers. You know, I have never 
seen these people, never even seen these people. I seen Copeland, but 
a lot of people I never seen. 

Mr. Halley. What city was Rogers in ? What part of New Jersey 
was he in ? 

Mr. Cohen. Asbury Park or something like that. 

Mr. Halley. Asbury Park ? 

Mr. Cohen. I think so ; yes. 

Mr. Halley. AYith whom else did you deal in 1945 and 1946 ? 

Mr. Cohen. I did business with an office in Chicago, Fischer. 

Mr. Halley Which Fischer ? Is that Fischetti's office ? 

Mr. Cohen. No ; I never done business with him. 

Mr. Halley. Which Fischer is this ? 

Mr. Cohen. I don't know; his name was Sam Fischer. He is a 
Fischer — Sam Fischer. 

Mr. Halley. Sam Fischer? 

Mr. Cohen. Yes. 

Mr. Halley. Did you ever do business in Chicago with Harry 
Kussell? 

Mr. Cohen. No, sir. 

Mr. Halley. Or Ralph Pierce? 

Mr. Cohen. No, sir. 

Mr. Halley. Now, in 1945 and in 1946 did you do any business at all 
witli bookies in Los Angeles ? 

Mr. Cohen. In Los Angeles ? 

Mr. Halley. Yes. 

Mr. Cohen. Nothing that would be considered business. 

Mr. Halley. Did you do any business with bookies in Los Angeles 
County ? 

Mr. Cohen. No, sir ; nothing that would be considered business. 

Mr. Halley. How do you distinguish between doing something and 
doing something that would be considered business ? 

Mr. Cohen. Somebody that I may know may have a tip on a horse, 
may have what you call a hot horse and couldn't get on nowhere, and 
they would ask me if I would move a hundred or two hundred for them 
or five hundred, or whatever it happened to be, but it was no business. 
I never done straight-out business with them. They knew that I had 
outs to move money, and sometimes they would call me to move them, 
but you couldn't consider it doing business with them. They were not 
customers. 



208 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. They did not do it on a regular basis with you? 

Mr. Cohen. They would call me as a favor. If they couldn't get 
off, they would call me. It was tough to get off at different times with 
horses. 

Mr. Halley. The people you have just referred to like Copeland and 
Rogers, they were people who you say you did business with ? 

Mr. Cohen. That is right; yes. 

Mr. Halley. They would call you regularly each day? 

Mr. Cohen. That is right. 

Mr. Halley. And place bets with you ? 

Mr. Cohen. That is right. 

Mr. Halley. On a substantial scale? 

Mr. Cohen. Yes ; and I would place bets with them. 

Mr. Halley. Did you know this man Pauley Gibbons who was 
killed in 1946? 

Mr. Cohen. I knew him, but not very well. 

Mr. Halley. Wasn't he a bookie in Los Angeles? 

Mr. Cohen. I couldn't answer that; I don't know his business. 

Mr. Halley. Isn't it a fact that you were trying to muscle into his 
territory ? 

Mr. Cohen. I never muscled in on a person in my life. 

Mr. Halley. You used your muscles to get what you wanted on 
occasions ; isn't that correct ? 

Mr. Cohen. I never muscled anybody in my life. 

Mr. Halley. Then we get back to Brophy. You wanted wire 
service, didn't you? 

Mr, Cohen. That is right. 

Mr. Halley. You beat him up, didn't you ? 

Mr. Cohen. I didn't beat him up to force him to give me wire 
service. 

Mr. Hali j:y. Just to persuade him, shall we say ? 

Mr. Cohen. No. 

Mr, Halley. Wasn't that muscle? 

Mr. Cohen. It wasn't like that at all ; that isn't muscle. 

Mr. Halley, Explain how that differs from muscle ? 

Mr, Strong, Isn't that getting a little bit ambiguous? Are you 
talking about muscling in, which is known generally, or are you 
talking about the muscles of the body ? 

The Chairman, I think the witness understands what is meant. 

Mr. Cohen. There was no muscle in the Brophy deal at all. 

Mr. Halley. I mean "muscle" in the sense of using your muscles 
to beat him up. 

Mr. Cohen. In that sense I guess so ; sure. 

Mr. Halley. You weren't trying to muscle in on Gibbons, were 



you 



Mr. Cohen. No, sir. 
Mr. Halley. You knew nothing about his murder in 1946? 
Mr. Cohen. Nothing whatsoever. 

Mr. Halley. That was May of 1946. Did you know Benny Gamson 
and George Levinson ? 

Mr. Cohen. I know of them ; I knew them, yes ; but not too well. 
Mr. Halley. You knew them too, did you not ? 
Mr. Cohen. Yes. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 209 

Mr. Halley. They were bookmakers, too, weren't they ? 

Mr. Cohen. I don't think so. 

Mr. Halley. You don't think they were in the bookmaking 
business ? 

Mr. Cohen. I don't think so; no. 

Mr. Halley. You have never been told they were bookies? 

Mr. Cohen. I don't think so ; no. 

Mr. Halley. Hadn't you made threats to them, and they made 
threats to you ? 

Mr. Cohen. No, sir ; they did not. 

Mr. Halley. If the Los Angeles Police Department thinks that 
is so, the Los Angeles Police Department is just wrong, then ? 

Mr. Cohen. I can't help what the Los Angeles Police Department 
thinks. Thej^ think a lot of things that are wrong. 

Mr. Halley. You think the Los Angeles Police Department is 
wrong about that? 

Mr. Cohen. There is no question about it. 

Mr, Halley. They were both killed at 4901 Beverly Boulevard on 
October 3, 1946. Do you know anything about their murder? 

Mr. Cohen. Not a thing. 

Mr. Halley. Let me read the record of the Los Angeles Police De- 
partment on that, and then I would ask you to comment on it. 

Benny "Meatball" Gamson and George Levinson were killed in their apart- 
ment at 4901 Beverly Boulevard. Cohen and Gamson had been fending for 
some time, and threats had been made back and forth. Pauley Gibbons was a 
partner of "Meatball" Gamson. Gamson and Levinson were also in the book- 
making rackets, and their demise was very advantageous to Cohen's interests. 

Mr. Cohen. What was that ? 

Mr. Halley. "Demise." I take it from your shaking of your 
head you disagree with the Los Angeles Police Department i 

Mr. Cohen. One hundred percent. 

Senator Wiley. Were they friends of yours, these people? 

Mr. Cohen. No, sir. 

Mr. Halley. Now in 1948 were you arrested in connection with 
the beating of a man named Petroff ? 

Mr. Cohen. In 1948 a man named Petroff ? 

Mr. Halley. Yes ; William Henry Petroff. 

]\Ir. Cohen. I don't even know the man, I don't think. 

Mr. Halley. Did you ever offer a bribe to a police officer to get him 
to refuse to sign a complaint against you in connection with the 
Petroff case ? 

Mr. Cohen. No, sir ; I never offered no bribe to a police officer. 

Mr. Halley. You know the Sicas, of course. 

Mr. Cohen. Yes, sir. 

Mr. Halley. Did you ever know that they were charged with beat- 
ing Petroff on August 30, 1948? 

Mr. Cohen. Oh, I didn't know what the case was. Now I know 
what you mean. 

Mr. Halley. Now you remember it? 

Mr. Cohen. Yes. 

Mr. Halley. Do you remember that you were accused of having 
threatened Petroff that he would get worse if he signed a complaint? 

Mr. Cohen. I don't think I was accused of that ; no. 



210 ORGAN/IZED CRIME IN INTERSTATE COMMERCE 

Mr. HalIxEY. Weren't you and Dave Ogul and Jimmy Rist arrested 
on that ? 

Mr. Cohen. We were pinched on it. 

Mr. Halley. When the police pinch yon, they accuse you, don't 
they ? 

Mr. Cohen. Tlie police asked me to go and get this Petroff. 

Mr. Halley. They asked you to go and get him ? 

Mr. Cohen. Yes. 

Mr. Halley. On the way in you threatened him that he better not 
sign a complaint, didn't you ? 

Mr. Cohen. I never threatened him at all ; nobody threatened him. 

Mr. Halley. Why would the police ask you to get somebody that 
the Sicas beat up ? 

Mr. Cohen. Because this particular fellow called up, called up my 
office for me. 

Mr. Halley. What particular fellow ? 

Mr. Cohen. This here fellow that had the trouble with Sica. 

Mr. Halley. Petroff, you mean? 

Mr. Cohen. Yes. 

Mr. Halley. When did he call your office ? After the beating ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Did he think you had something to do with the 
beating? Why would he call your office? 

Mr. Cohen. He wanted to know what to do. He must have thought 
I could advise him what to do about it or that I could straighten it 
out with him and Sica, something to that effect, I imagine. 

Mr. Halley. The Sicas were close associates of yours ; is that right ? 

Mr. Cohen. They weren't close at that time. 

Mr. Halley. You worked with them on and off; is that right? 

Mr. Cohen. The Sicas have been friends of mine, yes. 

Mr. Halley. Did you attempt to bribe him, Petroff, I mean? 

Mr. Cohen. I absolutely did not. 

Mr. Halley. You did not? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you remember taking him to a ranch near Malibu ? 

Mr. Cohen. I never took him nowhere. Pie met me at a ranch in 
Malibu. 

Mr. Halley. He met you there ? 

Mr. Cohen. That is right. 

Mr. Halley. What did you do at the ranch? What happened 
there ? 

Mr. Cohen. It was his attorney that we met. 

Mr. Halley. Do you remember some guns being waved around at 
the ranch? 

Mr. Cohen. There were no guns. 

Mr. Halley. There weren't three guns ? 

Mr. CoiiEN. Absolutely not. 

Mr. Halley. You carried a gun, didn't you, at that time ? 

Mr. Cohen. I did not. 

Mr. Halley. Didn't any of your men carry guns ? 

Mr. Cohen. Not that I know of; what do you mean by "my men"? 

Mr. Halley. A lot of people have gotten shot, you know. 

Mr. Cohen. What do you mean by "my men" ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 211 

Mr. Halley. The people who ^Ye^e working for you or with you. 

Mr. Cohen. There is nobody who works for me or with me. 

Mr. Halley. Now, Mr. Cohen, did Neddie Herbert w^ork for you or 
with you ? 

Mr. Cohen. He never worked for me at alL 

Mr. Halley. Wasn't he a bodyguard ? 

Mr. Cohen. Neddie Herbert was no bodyguard at all. He was 
my good friend. 

Mr. Halley. What was his business ? 

Mr. Cohen. What was his business ? 

Mr. Halley. Yes. 

Mr. Cohen. I can't answer what was his business. 

]Mr. Halley. He was always with you? 

Mr. Cohen. Out here ? 

Mr. Halley. Yes. 

Mr. Cohen. I don't think he had too much business at all. He 
done a little gambling and betting. 

Mr. Halley. Who supported him ? 

Mr. Cohen. He had money. 

Mr. Halley. Where did he get it? 

Mr. Cohen. He owned a bank in New York City. 

Mr. Halley. Neddie Herbert owned a bank in New York City? 

Mr. Cohen. Yes. 

Mr. Halley. You didn't give him any money ? 

Mr. Copien. Did I give him any money ? 

Mr. Halley. Yes. 

Mr. Cohen. I have loaned him money at different times and he has 
loaned me money at different times, 

Mr. Halley. What bank did Neddie Herbert own? 

]Mr. Cohen. I don't know the name of it. It was one of those pri- 
vately owned banks. 

Mr. Halley. The same bank that Frankie Milano owned? 

Mr. Cohen. No. 

Mr. Halley. They both owned banks ? 

Mr. Cohen. Frank Milano ? 

Mr. Halley. Yes. 

Mr. Cohen. He don't own a bank that I know of. 

Mr. Halley. Frank Milano doesn't own a bank? 

Mr. Cohen. No. 

Mr. Halley. But Neddie Herbert does or did ? 

Mr. Cohen. I don't think Milano owns a bank. 

Mr. Halley. Anthony Milano owns a bank, does he? 

Mr. Cohen. Yes. 

Mr. Halley. Where does he own it ? 

Mr. Cohen. In Cleveland, Ohio. 

Mr. Halley. And not in New York? 

Mr. Cohen. No. 

Mr. Halley. Anthony does not own one in New York ? 

Mr. Cohen. Not that I know of ; not to my knowledge. 

Mr. Halley. Neddie Herbert was killed, wasn't he? 

Mr. Cohen. That is right. 

Mr. Halley. In fact, you were with him when it happened ? 

Mr. Cohen. That is ria'ht. 



212 ORGANIZED CRIME. IN INTERSTATE COMMERCE 

Mr. Halley. Were either of you armed at that time ? 

Mr. Cohen. No, sir. 

Mr. Haeley. Neither one of you had a gun ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you remember when Harry Rothman was killed ? 

Mr. Cohen. That is right. 

Mr. Halley. Was he your bodyguard ? 

Mr. Cohen. No, sir. 

Mr. Halley. He had a gun at the time, didn't he ? 

Mr. Cohen. No, sir. 

Mr. Halley. Rist had a gun, didn't he ? 

Mr. Cohen. No. 

Mr. Halley. Neither of them had a gun ? 

Mr. Cohen. No, sir. 

Mr. Halley. Let's see if we can find an occasion when you did have 
a gun. 

Mr. Cohen. You can't find any ; I never had a gun. I only had a 
gun one time. 

Mr. Halley. When? 

Mr. Cohen. In my place of business where I was at. 

Mr. Halley. And that is the only time ? 

Mr. Cohen. I have had a gun, but I have never had it on me or on 
the streets with it. 

Mr. Halley. Do you know a fellow named Utley ? 

Mr. Cohen. Yes ; I know him. 

Mr. Halley. Do j^ou remember the time you pistol-whipped Utley? 

Mr. Cohen. I never pistol-whipped Utley. 

Mr. Halley. You did not ? 

Mr. Cohen. No, sir. 

Mr. Halley. What happened; just tell the committee what hap- 
pened ? 

Mr. Cohen. I don't know what happened. If I hadn't done it how 
can I tell you what happened ? 

Mr. Halley. Did you ever beat Utley up ? 

Mr. Cohen. Never. 

Mr. Halley. You mean that you deny having beaten up Utley ? 

Mr. Cohen. I deny it; yes, sir. 

Mr. Halley. You deny having beaten him up in a restaurant with 
100 people watching? 

Mr. Cohen. I deny it; yes. 

Mr. Halley. You did not pull out a gun and hit him with it? 

Mr. Cohen. I deny it positively. 

Mr. Halley. All right, we will just go ahead with the record here 
and go back to those things. 

Mr. Cohen. That is O. K. ; you go right ahead. 

Mr. Halley. Your denial stands on the record. You were arrested 
on suspicion of murder when Harry Rothman was killed; is that 
right? 

Mr. Cohen. That is riglit. 

Mr. Halley. That was in front of your own haberdashery ? 

Mr. Cohen. That is right. They were shooting at us but we got 
pinched for suspicion of murder. 

Mr. Halley. At 8800 Sunset Boulevard; is that right? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 213 

Mr. CoHEx. That is riglit. The fellow that got shot in the head, 
he was pinched for suspicion of murder too. 

Mr, Halley, Then you were arrested in 1949 for conspiracy in 
connection with the assault on Pearson? 

Mr. Cohen. That is right. 

Mr. Halley. Tliere were some guns in that assault, weren't there? 

Mr. Cohen. Not that I know of. I wasn't there and know nothing 
about it. 

Mr. Halley. You were arrested in connection with it ; weren't you ? 

Mr. Cohen. That is right. 

Mr. Halley. I will show you a picture of a gun and tell you that 
this comes from the files of the Los Angeles Police Department. That 
is a gun that was on the scene of that assault. Would you say that 
that is a picture of a gun ? 

Mr. Cohen. It is a gun, sure. 

Mr. Halley. The people who were accused of that assault, they were 
your followers, weren't they ? They were your friends ; weren't they ? 

Mr. Cohen. They were friends of mine ; yes. 

Mr. Halley. Some of them worked for you ? 

JSIr. Cohen. None of them worked for me. 

Mr. Halley. You put up the bail for some of them; did you not? 

Mr. Cohen. I helped some of them with the bail. 

Mr. Halley. Who did you help? 

Mr. Cohen. I don't know exactly. I helped some of them put up 
bail but they returned the money to me. 

Mr. Halley. Who did you put the bail up for ? 

Mr. Cohen. Well, I don't exactly know who. I didn't put up the 
bail for nobody ; I O. K.'d the bail. 

Mr. Halley. You O. K.'d the bail? 

Mr. Cohen. That is right. 

Mr. Halley. Where did you get the bail to put up ? Who actually 
put it up ? 

The Chairman. What do you mean by "O. K.'d the bail"? 

Mr. Cohen. I stood good for it, Senator. 

Mr. Halley. Who actually did put the bail up ? 

Mr. Cohen. For the collateral of the bail ? 

Mr. Halley. Who put it up ? 

Mr. Cohen. The bonding company. 

Mr. Halley. You don't remember the names? 

Mr. Cohen. The name of the bonding company? 

Mr. Halley. The names of the people who were arrested. 

Mr. Cohen. Oh. sure. Neddie Herbert, Meltzer, Ogul, and Jimmy 
Kist. 

Mr. Halley. How about Louie Schwartz ? 

Mr. Cohen. Louie Schwartz. 

'Mr. Halley. And Eli Lubin ? 

Mr. Cohen. Yes. 

Mr. Halley. And Dave Ogul ? 

Mr. Cohen. I said Ogul. 

Mr. Halley. There were six of them, and you were finally charged 
with conspiracy; is that right? 
Mr. Cohen. That is true; yes. 

Mr. Halley. While they were awaiting trial, two of them disap- 
peared : is that right ? 



214 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. That is right ; yes. 

Mr. Halley. Who were they ? 

Mr. Cohen. Dave Ogiil and Frank Niccoli. 

Mr. Halley. And do you know what happened to them? 

Mr. Cohen. No, sir ; I don't. 

Mr. Halley. One of them skipped bail, didn't he ? 

Mr. Cohen. I don't know what happened to either one of theni. 1 
don't know what happened, so how can I tell if he skipped bail? 
I don't know what happened to them. 

Mr. Halley. They just disappeared? 

Mr. Cohen. That" is right. 

Mr. Halley. And you lost your bail ; is that right ? 

Mr. Cohen. That is true. 

Mr. Halley. You had put up $25,000 for Ogul? 

Mr. Cohen. Yes. 

Mr. Halley. Was that your money or someone else's? 

Mr. Cohen. The money isn't put up. 

Mr. Halley. Who paid for the bonds ? 

Mr, Cohen. You mean who paid? 

Mr. Halley. For the bail bonds. 

Mr. Cohen. You mean for the loss of the bonds ? 

Mr. Halley. Yes. 

Mr. Cohen. I paid for it. 

Mr. Halley. You gave the money to the bondsman ? 

Mr. Cohen. Yes ; I did. For the loss of the $25,000, you mean ? 

Mr. Halley. Yes. 

Mr. Cohen. Yes. 

Mr. Halley. How about the bail on Niccoli ? 

Mr. Cohen. That is still on appeal. 

Mr. Halley. That is still on appeal ? 

Mr. Cohen. Yes. 

Mr. Halley. So far you are out only $25,000? 

Mr. Cohen. That is correct, yes. 

Mr. Halley. Of the six, Ogul and Niccoli are just missing; is that 
right ? 

Mr. Cohen. That is right. 

Mr. Halley. Neddie Herbert has been killed ? 

Mr. Cohen. That is right. 

Mr. Halley. Since then Jimmy Rist has been shot; he was shot 
with Herbert ; is that right ? 

Mr. Cohen. No, he wasn't. 

Mr. Halley. He was shot when Rothman was shot ? 

Mr. Cohen. He was shot when Rothman was shot ; that is right. 

Mr. Halley. Do you remember what happened at that trial ? 

Mr. Cohen. At what trial ? 

Mr. Halley. At the trial for conspiracy in 1949. 

Mr, Cohen. Do I remember what happened ? 

Mr. Halley. Yes. You went to trial, did you not? 

Mr. Cohen, Yes. 

Mr. Halley, You were acquitted ? 

Mr, Cohen, That is right, 

Mr. Halley. I will show you a picture and ask you if you recognize 
the people in the picture. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 215 

Mr. CoHEisr. Yes, sir. 

Mr. Halley. Would you identify them, going from left to right ? 

Mr. Cohen. This is Swan. 

Mr. Halley. Who is Swan ? 

Mr. Cohen. That officer that was involved w-ith the thing. 

Mr. Halley. You mean the officer who made the arrest? 

Mr. Cohen. I don't know who made the arrest. I don't know who 
done the arresting. 

Mr, Halley. Swan is a lieutenant, is he not ? 

Mr. Cohen. I think he is ; yes. 

Mr. Halley. Who is next in the picture? 

Mr. Cohen. This is the attorney. 

Mr. Halley. Who was the attorney ? 

Mr. Cohen. One of the attorneys. Parsons. 

Mr. Halley. What is Parsons' full name ? 

Mr. CopiEN. I don't know his full name. I just know him as Mr. 
Parsons. 

Mr. Halley. Was it Kussell Parsons ? 

Mr. Cohen. I think so. 

Mr. Halley. AVas he one of the candidates in the recent recall ? 

Mr. Cohen. Yes. 

Mr. Halley. And then you are in the middle of the picture ? 

Mr. Cohen. That is right. 

Mr. Halley. Who are the other people on the other side ? 

Mr. Cohen. This is Jimmy Rist; this is one of the officers whose 
name I can't recall. 

Mr. Halley. Another one of the police officers ? 

Mr. Cohen. Yes ; and the other f elloAV is Eli Lubin. 

Mr. Halley. I will offer this picture into evidence. 

The Chairman. It will be received as exhibit No. 8. 

(Whereupon the document referred to was marked "Exhibit No. 8," 
and is on file with the committee.) 

INIr. Halley. I also offer in evidence a set of five pictures, which I 
will state for the record are pictures which were taken at the time of 
the arrests, as one exhibit to be called exhibit No. 9. 

The Chairman. Very well. 

(Whereupon the documents referred to were marked "Exhibit No. 9," 
and is on file with the committee.) 

Mr. Halley. Mr. Cohen, is it not a fact that after the beating of 
Pearson, your men were apprehended, but were not booked at the sta- 
tion ? 

Mr. Cohen. I don't know what you mean by "my men." My men 
or those men were never under any obligation to work for me. 

Mr. Halley. Didn't they work for you ? 

Mr. Cohen. They were not what I would call "my men." That 
is the phrase that the newspaper gave them. I have a lot of people 
with me, but they are not "my men." 

Mr. Halley. Of course, Herbert was with you when he was killed, 
wasn't he ? 

Mr. Cohen. Herbert was my very good friend. 

Mr. Halley. Let's go down the list of the rest of them. Jimmy Rist 
was shot in your haberdashery ? 

Mr. Cohen. Yes. 



216 ORGANJZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Was he your very good friend ? 

Mr. Cohen. That is right. 

Mr. Halx-ey. Mekzer, was he your good friend? 

Mr. Cohen. At that time ; yes. 

Mr. Halley. And Louie Schwartz? 

Mr. Cohen. That is right. 

Mr. Halley. And Eli Lubin ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. Were Ogul and Niccoli also your very good friends? 

Mr. Cohen. Very good friends; yes. 

Mr. Halley. Why did they beat up this fellow Pearson? 

Mr. Cohen. Why ? 

Mr. Halley. Yes. 

Mr. Cohen. I couldn't answer you that ; I don't know. 

Mr. Halley. They did, though, didn't they ? 

Mr. Cohen. I don't know. I guess they didn't, they were all 
acquitted. 

Mr. Halley. There are the pictures of the men on the scene being 
arrested. 

Mr. Cohen. I imagine the court ruling goes above the pictures, and 
they were all acquitted. 

Mr. Halley. I am asking you for the fact. 

Mr. Cohen. I don't know. I wasn't there and I don't know. 

Mr. Halley. You don't know ? 

Mr. Cohen. No. 

Mr. Halley. Is it not a fact that those men were taken to a station 
house and then not booked? 

Mr. Cohen. I don't know. I understand that is the fact, but I don't 
know. 

Mr. Halley. You have heard that that is the fact ? 

Mr. Cohen. Yes. 

Mr. Halley. Didn't you also hear that an amateur photographer 
just happened to be on the scene and made those pictures ? 

Mr. Cohen. That is right. 

Mr. Halley. When the pictures were produced, it was necessary to 
arrest the men ? 

Mr. Cohen. These are all things I heard of ; that is right. 

Mr. Halley. These are all things that you have heard? 

Mr. Cohen. That is right. 

Mr. Halley. You were arrested with the men on a general con- 
spiracy ? 

Mr. Cohen. That is right. 

Mr. Halley. Is that right? 

Mr. Cohen. Yes, sir. 

Mr. Halley. What relationship have you had with the Sicas? Are 
they good friends of yours ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Have you had any business relationship with Joe 
Sica? 

Mr. Cohen. Not in the last 6 years, I would say. 

Mr. Halley. Prior to that what was your business relationship with 
Joe Sica? 

Mr. Cohen. We were just kids hustling around, that is all. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 217 

Mr. Halley. Wliat do you mean by "hustling around" ? 

Mr. Cohen. Gambling and trying to do the best we could. 

Mr. Halley. You mean you were operating bookmaking establish- 
ments ? 

Mr. Cohen. You couldn't even say operating at the time. It was 
really nothing to call operating, 

Mr. Halley. You were in the bookmaking business ? 

Mr. Cohen. Yes, we booked ; we booked and gambled ; yes. 

Mr. Halley. What else did you do ? 

Mr. Cohen. What else? Nothing else. 

Mr. Halley. That is what you did with Sica ? 

Mr. Cohen. Yes ; we were very good friends. 

Mr. Halley. You know that Sica was indicted for a violation of the 
Federal Narcotics Act in 1949 ? 

Mr. Cohen. That is right ; I read about it. 

Mr. Halley. Did you know a man named Abe Davidian, who was 
the chief witness against him ? 

Mr. Cohen. No; I didn't know him at all. 

Mr. Halley, You never met Abe Davidian ? 

Mr. Cohen. Never seen him or knew him whatsoever. 

Mr. Halley. You have heard that Abe Davidian was killed? 

Mr. Cohen. It was in the papers ; all over the papers, 

Mr, Halley, All over the papers ? 

Mr. Cohen. Yes. 

Mr. Halley. After the murder of Davidian, the charges against 
Sica had to be dropped; is that right? 

Mr. Cohen. I don't know if that is the fact or not, I don't think 
the charges were dropped from what the papers say, I don't think 
the charges are dropped. 

Mr. Halley. You don't think they are dropped ? 

Mr. Cohen. The papers say they are still under indictment. 

Mr. Halley. But he has never been brought to trial; is that right? 

Mr. Cohen. Not that I know of. 

Mr. Halley. Mr. Chairman, may we offer into evidence the Federal 
Bureau of Investigation records of arrests and convictions on James 
Kist? He was a friend of yours and still is? 

Mr. Cohen. Oh, yes ; sure. 

jSIr. Strong. I assume, Mr. Chairman, that there is no examination 
of exhibits allowed? 

The Chairman. We will let you see it. It will be received as ex- 
hibit No. 10 and made a part of the testimony. 

(Whereupon, document referred to was marked "Exhibit No. 10," 
and is on file with the committee.) 

Mr. Strong. There is no basis for objecting to anything, I suppose. 
I understand this is a fact-gathering body and you are gathering all 
the facts. 

The Chairman. You make any objections you wish, if you tliink 
the committee is violating any rights of your client. 

Mr. Strong. My position is that as a fact-gathering body you gather 
all the facts, and I see no basis for any objections at this time. 

Mr. Halley. That is right. I will offer into evidence the FBI 
record on Joseph Sica. 

The Chairman. This will be marked "Exhibit No. 11." 

68958— 51— pt. 10 15 



218 ORGANIZED CRIME IN INTERSTATE COMMERCE 

( Wliereupon the document referred to was marked "Exhibit No. 11," 
and is on file with the committee.) 

Mr. Halley. The record of David Ogiil, I will offer that into evi- 
dence. 

The Chairman. It will be marked "Exhibit Xo. 12.*' 
(Whereupon the document referred to was marked "Exhibit No. 12," 
and is on file with the committee.) 

Mr. Halley. I will next offer the record of Eli Liibin, alias Jerry 
Martin. I will offer that into evidence. 

The Chairman. It will be made a part of the record as exhibit 
No. 13. 

(Whereupon the document referred to was marked "Exhibit No. 13," 
and is on file with the committee. ) 

Mr. Halley. And the FBI record on Michael Cohen, alias Mickey 
Cohen. I will offer that into evidence. 

The Chairman. It will be made a part of the record as exhibit 
No. 14. 

(Whereupon the document referred to was marked "Exhibit No. 14," 
and is on file with the committee.) 

Mr. Halley. Now, Mr. Cohen, do you know a man named Eddie 
Borden ? 

Mr. Cohen. Yes, sir, 

Mr. Halley. Is he a bookmaker ? 

Mr. Cohen. I wouldn't call him a bookmaker ; no. 

Mr. Halley. What would you call him ? 

Mr. Cohen. He is the English editor for the Ring magazine. He 
was my manager when I was 16 years of age, my fight manager when 
I boxed in New York. 

Mr. Halley. He lives in Los Angeles now ? 

Mr. Cohen. I think he went back to New York. 

Mr. Halley. He went back to New York ? 

Mr. Cohen. That is what I think he did. 

Mr. Halley. When did he go back to New York ? 

Mr. Cohen. A week or so ago. 

Mr. Halley. He was in Los Angeles, was he not, until, at least, 
November 7 or 8 ? 

Mr. Cohen. I think so ; yes. 

Mr. Halley. Before he went back to New York was he in the book- 
making business in Los Angeles ? 

Mr. Cohen. I couldn't say he was in the bookmaking business. He 
is a bettor. He is a fellow "that likes to bet on everything. 

Mr. Halley. He had certain people that would come to him and bet 
with him ? 
^Mr. Cohen. I wouldn't say that; they probably exchanged prices. 
You could never say he was a bookmaker. 

Mr. Halley. But he booked bets, didn't he ? 

Mr. Cohen. Not that I know of. I don't think he could be called a 
bookmaker. 

Mr. Halley. If people came to him and made bets with him, he 
would be a bookmaker ? They did do that, didn't they ? 

Mr. Cohen. Not that I know of. 

Mr. Halley. Do you know a fellow by the name of Louie Berman ? 

JNIr. Cohen. Not offhand, not by name. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 219 

Mr. Halley. You do not ? 

Mr. Cohen. No. 

Mr. Hallet. You never heard of him ? 

Mr. Cohen. I don't think so. 

Mr. Halley. Did you ever hear of anybody named Sammy Lewis ? 

Mr. Cohen. Yes. 

Mr. Halley. Do you know if he ever made bets with Eddie Borden ? 

]Mr. Cohen. Not that I know of. 

Mr. Halley. Didn't he ever bet $500 wdth Eddie Borden? 

Mr. Cohen. I wouldn't know. 

Mr. Halley. Do you know a man by the name of Jules Stein ? 

Mr. Cohen. No, sir. 

Mr. Halley. You never heard of him either ? 

Mr Cohen. No, sir. 

Mr. Halley. Just what do you mean when you say that Borden was 
making bets here in Los Angeles ? 

jNIr. Cohen. He would bet on everything ; he was a fellow that bet 
on everything. 

Mr. Halley. He bet with people? 

Mr. Cohen. Yes. 

Mr. Halley. Did he have a place from which he operated? 

Mr. Cohen. You couldn't say that he operated. He would be at 
every fight. He would be at every sporting event. 

Mr. Halley. And he would make bets ? 

Mr. Cohen. You know, they would exchange bets. I don't even 
know liow they do it. The prices and things, I don't bet that way 
myself. 

Mr. Halley. Would you call him a commission agent? 

Mr. Cohen. I couldn't call him as being anything in the gambling 
business at all. 

Mr. Halley. You don't think so? 
• Mr. Cohen. I don't think so ; no. 

Ml'. Halley. But he did make bets from time to time ? 

]Mr. Cohen. Yes, he bet on all the football games, baseball games, 
and everything. 

]\Ir. Halley. Do you know a man by the name of Eli Lubin? 

Mr. Cohen. Yes. 

Mr. Halley. He was one of the men who was on trial with you, 
wasn't he? 

Mr. Cohen. That is right. 

Mr. Halley. Do you loiow a man named Hymie Miller ? 

Mr. Cohen. Yes. 

Mr. Halley. Hymie Miller is a bookie; isn't he? 

■Mr. Cohen. I don't know what he is; I don't know his business. 

Mr. Halley. He is under indictment for it ? 

Mr. Cohen. Everybody says he is a bookmaker, but I wouldn't know 
if he was or not. 

Mr. Halley. But you have heard it ? 

Mr. Cohen. I have heard it; yes. 

Mr. Halley. Did you have any dealings with Lubin and Miller over 
the week end of November 4 ? 

Mr. Cohen. Any dealings? 

Mr. Halley. Yes. 



220 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. What do you mean by "dealings" ? 

Mr. Halley. Did you talk to them ? 

Mr. Cohen. Yes. 

Mr. Halley. On the telephone? 

Mr. Cohen. Yes. 

Mr. Halley. What about? 

Mr. Cohen. About this fellow that you asked about, Eddie Borden. 

Mr. Halley. You talked about Eddie Borden? 

Mr. Cohen. That is right. 

Mr. Halley. Tell the committee about that. 

Mr. Cohen. I thought the fellow — the fellow showed up missing. 

Mr. Halley. Who showed up missing? 

Mr. Cohen. He was missing. 

Mr. Halley. Eddie Borden was missing? 

Mr. Cohen. That is right. Before he was missing he talked about 
committing suicide. 

Mr. Halley. Because he was over his head on some debts he had 
accepted ; is that right ? 

Mr. Cohen. I don't think that was the reason. I don't know of it. 

Mr. Halley. Wasn't he in the hole for $4,000 that he couldn't make 
good ? 

Mr. Cohen. I couldn't answer that truthfully ; I don't know. 

Mr. Halley. And that you would have had to make good on his 
debts? 

Mr. Cohen. I would have had to make good? 

Mr. Halley. Surely. 

Mr. Cohen. Why would I ? 

Mr. Halley. You were responsible for him, were you not ? 

Mr. Cohen. That is absolutely ridiculous. 

Mr. Halley. Go ahead with the telephone conversation that you 
had. 

Mr. Cohen. I thought the fellow was going to kill himself and we 
were pretty worried about it. I not only called Las Vegas, but I called 
New York City, the editor of the Ring magazine, who was a very close 
friend and who he works for, and Ray Arcel, who works with the 
heavyweight champ of the world ; I called them looking for him. We 
didn't know what happened to him. He was talking about committing 
suicide and we tried to run it down. That is what I would do for 
anybody. He is a fellow that managed me when I was 16 years of age 
and we were very, very close friends. 
Mr. Halley. What happened next? 

Mr. Cohen. The police department thought there was something 
wrong. 

Mr. Halley. You are moving too fast, Mr. Cohen. You called 
Lubin in Las Vegas ; is that right? 

Mr. Cohen. I called him when I heard he was in Las Vegas. 
Mr. Halley. How did you hear Lubin was in Las Vegas ? 
Mr. Cohen. I knew Lubin was there but when I heard Borden was 
there I called. 

Mr. Halley. You keep in close touch with Lubin's movements, do 
you? 

Mr. Cohen. No. 

INIr. Halley. You knew he was in Las Vegas ; you knew his where- 
abouts ? 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 221 

Mr. Cohen. Yes. 

Mr. Hallet. You knew Miller Avas in Las Vegas ? 

Mr. Cohen. I didn't know Miller was there. 

Mr. Hallet. How did you lind out that Miller was there ? 

Mr. Cohen. When I got the call back that Eddie Borden was with 
Miller or at the same hotel Miller was at or something like that 

Mr. Halley. What hotel were they at? 

Mr. Cohen. The Flamingo. 

Mr. Halley. You called Lubin and Miller and what did you ask 
them to do ? 

Mr. Cohen. If they could find Eddie. 

Mr. Halley. Did they find Eddie ? 

Mr. Cohen. Yes ; they did. 

]\Ir. Halley. Where did they find him ? 

Mr. Cohen. I don't know ; they found him in Las Vegas. 

Mr. Halley. They looked all over Las Vegas until they found him ; 
is that right ? 

Mr. Cohen. That is right. 

Mr. Hai-ley. They found him about 1 or 2 o'clock in the morning, a 
Saturday morning ; isn't that right ? 

Mr. Cohen. I think so. 

Mr. Halley. On November the 4th ? 

Mr. Cohen. I think so ; yes. 

Mr. Halley. Of this year ? 

Mr. Cohen. That is right. 

Mr. Halley. Just a week or two ago ? 

Mr. Cohen. That is true. 

Mr. Halley. Did you do anything then after they found him? 

Mr. Cohen. After they found him I said, "Look out that the guy 
don't kill himself." 

INIr. Halley. You were really worried about him, were you ? 

Mr. Cohen. Sure, I worried about him. The man was like my 
brother. 

Mr. Halley. What did you do to take care of him ? 

Mr. Cohen. What did I do to take care of him ? 

Mr. Halley. Wliat did you tell them to do to make sure Eddie 
didn't kill himself? 

Mr. Cohen. To watch out for him. 

Mr. Halley. Did they do anything with him ? 

Mr. Cohen. I don't know what they did with him. 

Mr. Halley. Did they go anywhere ? 

Mr. Cohen. Did they go anywhere? 

Mr. Halley. Yes. 

Mr. Cohen. I don't know ; I wasn't there. 

Mr. Halley. Did they come to Los Angeles ? 

Mr. Cohen. Yes. 

Mr. Halley. How did they come? 

Mr. Cohen. I imagine on a plane. 

Mr. Halley. Well, you know how they came? 

Mr. Cohen. On a plane ; yes. 

Mr. H-AIJ.EY. You know that; you don't have to imagine it; isn't 
that right? 

Mr. Cohen. They came on a plane ; that is right. 



222 ORGANiIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Who told them to come on a plane ? 

Mr. Cohen. Nobody told them. They just came on a plane. No- 
body told them to come on a plane. 

Mr. Halley. Didn't you tell them to come on a plane ? 

Mr. Cohen. I asked Eddie to come on back. 

Mr. Halley. You asked Eddie to come on back? 

Mr. Cohen. I said to him, I said, "What is the matter with you? 
What is wrong?" 

Mr. Halley. Did you say, "Come on back on a plane" ? 

Mr. Cohen. No. 

Mr. Halley. Did you talk to Miller and Lubin about their coming 
back with him? 

Mr. Cohen. No. V 

Mr. Halley. You did not ? ' 

Mr. Cohen. I talked to Lubin about w^atching out for the fellow. 
I said, "Make sure the fellow doesn't do anything to himself." 

Mr. Halley. And Lubin came back to Los Angeles with him ; is that 
right ? 

Mr. Cohen. Yes ; I think so. ] 

Mr. Halley. How did they come back ? 

Mr. Cohen. On a plane. 

Mr. Halley. On a regular airplane ? 

Mn Cohen. I don't know. 

Mr. Halley. They chartered one, didn't they ? " ! 

Mr. Cohen. I don't know if it was chartered or not. *'' 

Mr. Halley. You told them to charter a plane, didn't you ? 

Mr. Cohen. I told them nothing. I told them to look out for Eddie 
Borden. 

Mr. Halley. You were on the telephone talking to Las Vegas, 
weren't you ? 

Mr. Cohen. That is right. 

Mr. Halley. You told Lubin to bring him back in a chartered plane, 
didn't you ? 

Mr. Cohen. I told Lubin to look out for him and see that he was 
safe. 

Mr. Halley. To see that he was safe ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. You suggested that he bring him to Los Angeles, 
didn't you ? 

Mr. Cohen. I said that I wished he would come back here. 

Mr. Halley. Your wish brought him back; is that right? 

Mr. Cohen. Yes. 

Mr. Halley. Did you talk to Borden ? 

Mr. Cohen. Yes. 

Mr. Halley. What did Borden say? 

Mr. Cohen. I said, "Wliat happened to you?" Naturally, nobody 
knew what it was, and not only me but everybody else was worried 
about him. He has a lot of other friends here. The fellow was the 
type of fellow that always spoke of committing suicide and, naturally, 
we were quite worried about him. 

Mr. Halley. Was there no other reason that you wanted Kim back 
in Los Angeles ? 

Mr. Cohen. Not that I know of. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 223 

Mr. Halley. Did you state any other reason on the telephone? 

Mr. Cohen. No, sir. 

Mr, Halley. Maybe you were kidding Lubin and Miller and you 
were telling them some other reason just to fool them? 

Mr. Cohen. No. I told them, I said, "I don't know what happened 
to the guy. I don't know if he blew his top or something like that." 
I may have said that. 

Mr. Halley. Didn't you say you had to get Borden back to Los 
Angeles ? 

Mr. Cohen. That I had to? 

Mr. Halley. Yes. 

Mr, Cohen. Well, jqs; I said that the coppers here were worried 
about him ; that is right. 

Mr, Halley, You said to get him back here right away, did you not ? 

Mr, Cohen, No ; I said to Eddie, "I wish you would come back here 
because you are going to cause a lot of people to get pinched." 

Mr. Halley. So finally he agreed to come back ? 

Mr. Cohen. Yes. 

Mr. Halley. And they were going to take the regular airplane 
back ; isn't that right ? 

Mr. Cohen. I don't know what they took. 

Mr. Halley. They chartered a plane. You told them they better 
charter a plane, did you not? 

Mr. Cohen. I told them if they can't get a regular airplane to get 
on another one. I said, "If you can't get on a regular airplane, get 
back anyway." 

Mr. Halley. I thought you said a little while ago that you didn't 
know whether they took a plane or not. 

Mr. Cohen, I didn't say that at all, I said that I imagine they took 
a plane, 

Mr, Halley, You know they took a plane, don't you ? 

Mr, Cohen. Yes. 

Mr. Halley. You told them if they could not get on the regular 
plane to charter one? 

Mr. Cohen. I did not tell them to charter one. I said, "Get back 
here as fast as you can." 

Mr. Halley. Didn't they say they could get on a regular plane and 
didn't you say, "No ; charter one and come on back" ? 

Mr, (Cohen, No, 

]VIr, Halley, Didn't they actually charter a plane from the Western 
Air Lines ? 

Mr, Cohen, I don't know, 

Mr, Halley, You know they did, don't you ? 

Mr, Cohen, You are putting words in my mouth now. I don't 
know what they did in Vegas. 

Mr. Halley. Didn't you tell them to do it ? 

Mr, Cohen, I didn't tell them to do nothing but to watch out for 
Eddie, 

Mr. Halley. And to bring him back ? 

Mr. Cohen. I didn't tell them to bring him back. 

Mr. Halley, You said that the JDolice were worried about Eddie? 

Mr, Cohen, Yes, I said, "You are going to get your friends pinched. 
Everybody is worrying about you. They think that what is happening 
to you is what happened to other people." 



224 ORGANIZED CRIME^ IN INTERSTATE COMMERCE 

Mr. Halley. At that point ^Miller and Lubin were standing next to 
Eddie? 

Mr. Cohen. I don't think Miller was around there. 

Mr. Halley. Just Lubin? 

Mr. Cohen. Yes. 

Mr. Halley. Lubin went out and found Eddie, got him to the phone, 
and you insisted that Lubin bring him back? 

Mr. Cohen. I did not insist that Lubin bring him back. 

Mr. Halley. You insisted to Eddie that he come back, or did you 
just urge him to come back? 

Mr. Cohen. I just urged him. 

Mr. Halley. Did you urge him strongly? 

Mr. Cohen. Weakly. 

Mr. Halley. Weakly? 

Mr. Cohen. Yes. 

Mr. Halley. Did you persuade him ? 

Mr. Cohen. I asked him to come back. 

Mr. Halley. You didn't have one of these arguments that you have 
told us about? 

Mr. Cohen. No ; I never argue with Eddie. 

Mr. Halley. Did he protest or was he happy to come back ? 

Mr. Cohen. He was happy to come back. 

Mr. Halley. This was about 1 or 2 o'clock in the morning, wasn't it! 

Mr. Cohen. I think so. 

Mr. Halley. They did charter a plane ; you know that ; isn't that 
right? 

Mr. Cohen. I don't know that. 

Mr. Halley. You just said that you told them if they couldn't get 
here on a regular plane that they better get here the best way they 
could. 

Mr. Cohen. I don't know that they chartered a plane. 

Mr. Halley. You suggested that they charter a plane ? 

Mr. Cohen. I said, "Get back here the best way you can." 

Mr. Halley. Didn't you mention, "You better charter a plane"? 

Mr. Cohen. I didn't mention anything about chartering a plane. 

Mr. Halley. There was no discussion of chartering a plane ? 

Mr. Cohen. None that I can recall. 

Mr. Halley. This was only about 10 days ago. 

Mr. Cohen. I don't recall it. 

Mr. Halley. Is it possible? 

Mr. Cohen. Anything is possible ; sure. 

Mr. Halley. Is it within the realm of reasonable probability that in 
the conversation that you said, "If you can't get back on the regular 
airline, charter a plane. You have to get back"? 

Mr. Cohen. I don't think I said that. 

Mr. Halley. Or anything like that? 

Mr. Cohen. No, sir. 

Mr. Halley. Anything at all about chartering a plane? 

Mr. Cohen. I don't think it was brought up; to the best of my 
knowledge, I don't remember. 

Mr. Halley. They were actually in Los Angeles at 9 o'clock the next 
morning, weren't they ? 

Mr. Cohen. I think they were. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 225 

Mr. Halley. They came right back as fast as they eoukl ? 

Mr. Cohen, I don't know ; I didn't see them at that time. 

Mr. Halley. Lnbin stayed with him ; is that correct ? 

Mr. Cohen. Lnbin stayed with him ? 

Mr. Halley. Yes. 

Mr. Cohen. Not that I know of. 

Mr. Halley. He didn't stay with Borden ? 

Mr. Cohen. Not that I know of. 

Mr. Halley. He brought him back to Los Angeles, didn't he ? 

Mr. Cohen. I think he took the ride back with him. 

Mr. Halley. Did he tell you what he rode back on ? 

Mr. Cohen. On a plane. 

Mr. Halley. On a chartered plane ? 

Mr. Cohen. He didn't mention no chartered plane. 

Mr. Halley. Didn't he mention that to you ? 

Mr. Cohen. No. 

Mr. Halley. Just a plane; is that right? 

Mr. Cohen. Yes. 

Mr. Halley. Do you know where they went ? 

Mr. Cohen. No. 

Mr. Halley. Did you ever hear of the Mayan Hotel? 

Mr. Cohen. Yes. 

Mr. Halley. Eoom 235 ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Who lives there ? 

Mr. Cohen. Babe McCoy. 

Mr. Halley. He is a matchmaker ; is that right ? 

Mr. Cohen. That is right. 

Mr. Halley. Were you there on the morning of Saturday, No- 
vember 4, 1950 ? 

Mr. Cohen. On the morning ? 

Mr. Halley. Yes. 

Mr. Cohen. I don't think in the morning ; no. I think it was in the 
afternoon. 

Mr. Halley. Were you there in the afternoon ? 

Mr. Cohen. Yes. 

Mr. Halley. "VVliattime? 

Mr. Cohen. I think around 1 o'clock or so ; 12 : 30 or 1 o'clock, or 
somewhere in between there. 

Mr. Halley. Who was there when you were there? 

Mr. Cohen. Who was there ? 

Mr. Halley. Yes. 

Mr. Cohen. Eddie Borden. 

Mr. Halley. Who else? 

Mr. Cohen. Babe McCoy. 

Mr. Halley. Anyone else ? 

Mr. Cohen. Not that I recall. 

Mr. Halley. Did you go for an auto ride with Borden that day? 

Mr. Cohen. That is right; yes. 

Mr. Halley. Where did you ride? 

Mr. Cohen. We went to the tailoring shop. 

Mr. Halley. Your tailoring shop ? 

Mr, Cohen. Yes. 

Mr. Halley. Did you go anywhere else ? 



226 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. To the bank. 

Mr. Halley. What bank? 

Mr, Cohen. One of the banks on Hollywood ; I don't know which 
one it was exactly. 

Mr. Halley. What happened at the bank ? 

Mr. Cohen. I don't know. 

MBr. Halley. Did Borden go into the bank ? 

Mr. Cohen. Yes. 

Mr. Halley. Did you go into the bank ? 

Mr. Cohen. No, sir. 

Mr. Halley. Did he come out of the bank and come into your car? 

Mr. Cohen. That is right. 

Mr. Halley. Did he hand you anything when he got into the car? 

Mr. Cohen. No, sir. 

Mr. Halley. Did he give you any money that day ? 

Mr. Cohen. No ; I don't think there was nwj transaction of money 
that day. 

Mr. Halley. Didn't he give you $500 ? 

Mr. Cohen. I don't think he gave it to me that day ; no. He didn't 
give me $500. 

Mr. Halley. Didn't he give you $500 in cash ? 

Mr. Cohen. No ; he gave me $400. 

Mr. Halley. In cash ? 

Mr. Cohen. Yes. 

Mr. Halley. That day ? 

Mr. Cohen. Yes. 

Mr. Halley. Saturday morning ? ' 

Mr. Cohen. No; it wasn't Saturday morning. I don't think he 
gave it to me Saturday. 

Mr. Halley. That is the day he came in. 

Mr. Cohen. But I don't think he gave it to me that day. 

Mr. Halley. He went to the bank that day, didn't he ? 

Mr. Cohen. Yes. 

Mr. Halley. You were with him when he went to the bank ? 

Mr. Cohen. Yes. 

Mr. Halley. When do the banks close in Los Angeles on Saturday? 

Mr. Cohen. I think 12 o'clock. 

Mr. Halley. So you must have gotten to the Mayan Hotel in the 
morning rather than in the afternoon ? 

Mr. Cohen. It was about noontime. 

Mr. Halley. You had to be at the bank by noon. 

Mr. Cohen. That is right. I don't know if it was Saturday or not. 

Mr. Halley. It was Saturday, November the 4th. 

Mr. Cohen. It was? 

Mr. Halley. Yes. 

Mr. Cohen. Then I don't know. I never went into the bank with 
him at all. 

Mr. Halley. You drove him to the bank and you sat in the car? 
You had Farkas with you ? 

Mr, Cohen. Yes ; it was his car. 

Mr. Halley. It was his car? 

Mr. Cohen. Yes. 

Mr. Halley. Did he go into the bank with him ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 227 

Mr. Cohen. I don't know that. 

Mr. Halley. But you sat out in the car ? 

Mr. Cohen. I took a shine. I took a shine over there on the street. 

Mr. Halley. And then Borden came out and was it there that he 
gave you the $400. 

Mr. Cohen. No. 

Mr. Halley. Where did he give you the $400? 

Mr. Cohen. We went from there to the tailoring shop and, let's see, 
then he asked Sam to drive him home. He wanted to get cleaned up, 
and he went on home, and I think it was later on that night that he 
gave me $400. I think I went over to see him later on that evening. 

INIr. Halley, You did get to the Mayan Hotel then that morning ? 

Mr, Cohen. Around noon. 

Mr. Halley. You got there and you had some talk with him ? 

Mr. Cohen. There was hardly no talk. 

Mr. Halley. You were worried about his health, weren't you ? 

Mr. Cohen. Yes. 

Mr. Halley. You didn't just take him and rush him off to the bank 
then ? 

Mr. Cohen. He asked to go to the bank, on the way over to the tail- 
oring shop. We went up Eighth Street. 

Mr. Halley. What happened at the Mayan Hotel at room 235 on 
Saturday morning ? 

Mr. Cohen. What happened ? 

Mr. Halley, Yes. 

Mr. Cohen. Nothing happened. 

Mr. Halley. Did you have any conversation at all ? 

Mr. Cohen. I asked him what happened to him. 

Mr. Halley. What did he say ? 

Mr. Cohen. He had a cut on his wrist with some bandage over it and 
a cut over here, and he said he was tired of living or something. 

Mr. Halley. Wliat other conversation was there? You said, the 
way I understand it, "What happened to you," and he said, "I am tired 
of living." Then what happened? 

Mr. Cohen. That is all, and the generality of that conversation; 
that he was disgusted or this and that, and he didn't know^ — he was 
blowed up. 

Mr. Halley. What do you mean he was "blowed up" ? 

Mr. Cohen. He was disgusted. 

Mr. Halley. He owed some money around that time, did he not? 

Mr. Cohen. How would I know ? 

Mr. Halley. Didn't he tell you that ? 

Mr. Cohen. No, sir. 

Mr, Halley, l^Hiat did he go to the bank for ? 

Mr. Cohen. He needed some money. He went broke in Las Vegas. 

Mr. Halley. And he needed some money ? 

Mr. Cohen. Yes. 

Mr. Halley. He took $500 out of the bank; isn't that the fact? 

Mr. Cohen. I don't know what he took out of the bank. 

Mr. Halley. Then he gave you $400 of it ? 

Mr. Cohen. I asked him for it. 

Mr. Halley. What did you ask him for that for ? 

Mr. Cohen. I needed it at that time. 



228 ORGANiIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You needed it ? 

Mr. Cohen. I gave it back to him. 

Mr. Halley. He was your good friend and he was broke 

Mr. Cohen. He didn't need the money then and there. I needed the 
money and then gave it back to him. We have taken money that way 
40 or 50 times. 

Mr. Halley. Did you go to the bank because he needed the money 
or because you needed the money ? 

Mr. Cohen. He went on his own. He was going back to Vegas, and 
from there he was going back to New York and get back on the 
magazine. 

Mr. Halley. When did you think of the fact that you needed 
money ? 

Mr. Cohen. That afternoon. 

Mr. Halley. You didn't ask him for money in the morning meeting 
at the Mayan Hotel, did you ? 

Mr. Cohen. No, sir. 

Mr. Halley. Isn't it a fact that at the Mayan Hotel you told him 
he would have to make good the bets ? 

Mr. Cohen. That is absolutely untrue. 

Mr. Halley. Isn't it a fact that he went right that minute with you 
to the bank and withdrew $500 ? 

Mr. Cohen. That is not a fact. All you are doing is what the Los 
Angeles Police Department thinks. That is all you are doing, is asking 
me what the Los Angeles Police Department thinks. 

Mr. Halley. That is not a fact ? 

Mr. Cohen. There is no semblance to it whatsoever. 

Mr. Halley. It is a fact that you telephoned Las Vegas Friday 
morning or Saturday morning at about 1 o'clock, isn't it ? 

Mr. Cohen. Yes. 

Mr. Halley. And in the early hours of the morning your friend Eli 
Lubin went out and found this man ; that is a fact, is it not ? 

Mr. Cohen. Yes. I would do that to any one of my friends that was 
missing. 

Mr. Halley. Did he ask for help ? He was in Las Vegas, wasn't he ? 

Mr. Cohen. Do your friends have to ask for help ? When a man is 
missing and you think some harm may come to him or he would do 
some harm to himself 

Mr. Halley. Did you think some harm came to him? 

Mr. Cohen. I thought he was going to kill himself. I will bring 
you 20 people that will tell 3^ou the same thing. 

Mr. Halley. Did you think Eli Lubin would do him some harm ? 

Mr. Cohen. He never even loiew him. 

Mr. Halley. How did he find him ? 

Mr. Cohen. From what I told him. 

Mr. Halley. Wliy did you think he would kill himself ? What was 
he worried about ? 

Mr. Cohen. He said it 50 different times. 

Mr. Halley. What was he worried about ? 

Mr. Cohen. I don't know. Somebody talked to him about different 
things, if somebody would talk to him about different things, he would 
get excited and say, "What kind of a world is this to live in?" 



ORGANIZED CRIME IN INTERSTATE COMMERCE 229 

Mr. Halley. How did this all start? What resulted in your finally 
getting excited at 1 a. m. on the morning of Saturday, November the 
4th, and deciding you had to do something about your friend, Eddie 
Borden '? 

Mr. Cohen. I didn't decide at that time. I decided when he first 
came up missing. 

Mr. Halley. When did he first come up missing? 

Mr. Cohen. About 3 or 4 days before that. 

Mr. Halley. What had you done for 3 or 4 days before that ? 

Mr. Cohen. Looked all over for him. Got pinched on Hollywood 
Boulevard looking for him. 

Mv. Halley. Why was it necessary to bring him back from Las 
Vegas? 

Mr. Cohen. Why ? Because the coppers thought he was killed. 

JNIr. Halley. You could have told the coppers he wasn't killed. 

Mr. Cohen. They sure believe me. Go tell them something. 

Senator Tobey. You looked hard to find him. You were anxious to 
get ahold of him ? 

Mr. Cohen. Like I would be for any one of my friends. 

Senator Tobey. Have you looked just as hard to get ahold of Ogul 
and Niccoli ? 

Mr. Cohen. Harder. 

Senator Tobey. We will come to that later. 

Mr. Halley. Did he complain to you about being broke? 

Mr. Cohen. He said that he went broke in Vegas. 

]\Ir. Halley. Had he been broke before he went to Vegas ? 

Mr. Cohen. Nobody could tell about the fellow. Everybody 
thought he was a very wealthy fellow. In fact, I never knew myself. 

Mr. Halley. Did you take any more money from him? 

Mr. Cohen. No, sir ; oh, yes. He got $1,000 from Nat Fleisher that 
he loaned me. 

Mr. Halley. He gave you a thousand-dollar check from Fleisher; 
isn't that correct ? 

Mr. Cohen. Yes ; after I paid him the $400 ; but he got $1,000 from 
Nat Fleisher for me. 

Mr. Halley. Nat Fleisher was in New York and he got ahold of 
Fleisher and had him send you a thousand dollars ? 

Mr. Cohen. No ; he sent it to him and he gave it to me. 

Mr. Halijsy. He endorsed the check over to you ? 

Mr. Cohen. Yes. 

Mr. Halley. And Fleisher is the man that owns Ring magazine? 

Mr. Cohen. That is true. 

Mr. Halley. Did he get you any other money ? 

Mr. Cohen. I don't think so. 

Mr. Halley. Wasn't there another thousand dollars ? 

Mr. Cohen. Can you recall it to me ? 

Mr. Halley. From A1 Weill? 

JNIr. Cohen. Yes ; but that there he used himself. I got the check 
caslied for him. He closed his account in the bank and I got the 
check cashed for him. 

Mr. Halley. He got ahold of Gus Wilson and had Gus Wilson get 
$1,000 for you from Al Weill ; isn't that right? 

Mr. Cohen. He didn't give it to me. I got the check and cashed it 
for him. 



230 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You got the cash ? 

Mr. Cohen. I got the check cashed for him from Giis Wilson because 
he didn't have no bank account, but he kept the money himself. 

Mr. Halley. He endorsed the check over to you. 

Mr. Cohen. To get it cashed. 

Mr. Halley. It is your story that you got $400 from him on a 
Saturday afternoon ? 

Mr. Cohen. Saturday evening. 

Mr. Halley. At your haberdashery ? 

Mr. Cohen. At his place. 

Mr. Halley When did you give that back to him ? 

Mr. Cohen. I think I gave it back to him the next day or so. 

Mr. Halley. On Sunday ? 

Mr. Cohen. I think it was Monday that I gave it back to him. 

Mr. Halley. On Thursday you got another thousand from him ; is 
that right ? 

Mr. Cohen. Yes. I told him I needed some money. When I gave 
him the $400 back I told him I needed some money and he told 
me 

Mr. Halley. Did you really need money ? 

Mr. Cohen. Sure. 

Mr. Halley. What is the status of your bank account today ? 

Mr. Cohen. Nothing. 

Mr. Halley. Nothing in your bank account ? 

Mr. Cohen. That is right. 

Mr. Halley. Do you have any cash ? 

Mr. Cohen. Do I have any cash? 

Mr. Halley. Yes ; cash on hand. 

Mr. Cohen. A few hundred dollars. 

Mr. Halley. Other than that yon are broke ? 

Mr. Cohen. Yes. 

Mr. Halley. Have you fired your servants ? 

Mr. Cohen. No, sir. What do you mean "servants" ? I have one 
girl in the house ; no servants. 

Mr. Halley. Let's get the real story on this. Were you just doing 
Borden a favor to bring him back from Las Vegas ? 

Mr. Cohen. I never brought Eddie back from Las Vegas. Borden 
is my very close friend since I am 16 years of age. 

Mr. Halley. He was in great trouble ; was he ? 

Mr. Cohen. There is nothing wrong with Borden. They have put 
something in your mind that is absolutely ridiculous. The police de- 
partment has put something in your mind that is silly. 

Mr. Halley. I have facts in my mind. 

Mr. Cohen. Borden is a fellow that never was arrested in his life. 

Mr. Halley. Well, I have the facts in my mind. 

Mr. Cohen. You know what they done with Borden ? They pinched 
him since he came back from Las Vegas twice. They took him down 
and they put his tie up around his neck. They don't tell you them 
stories ; do they ? Here is a fellow who never has been arrested. 

Mr. Halley. You stated you were getting him for the Los Angeles 
Police Department because they were worried ; is that right ? 

Mr. Cohen. I was getting him because I knew what was going on. 
They were starting to harass everybody. 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 231 

Mr. Halley. Why didn't you leave the poor man in Las Vegas 
where he wouldn't be harassed ? 

Mr. Cohen. They were under the impression he was killed. 

Mr. Halley. You could have told them where he could be reached 
on the telephone at Las Vegas. That makes no sense at all, your ex- 
planation. 

Mr. Cohen. It does to me; it makes sense. 

Mr. Halley. You mean the police department couldn't find out if a 
man was in Las Vegas ? 

Mr. Cohen. They wouldn't want to ; they wouldn't want to find out. 

Mr. Halley. Do you have that low an opinion of the police de- 
partment ? 

]Mr. Cohen. Of certain members of the police department. 

Mr. Halley. You had to bring him here in the early hours of the 
morning ? 

Mr. Cohen. I didn't have to bring him here. I asked my friend to 
come back. 

Mr. Halley. And for them to bring him back? 

Mr. Cohen. I told nobody to bring him back. 

Mr. Halley. You asked Lubin to bring him back. 

Mr. Cohen. I did not. 

Mr. Halley. You spoke to both of them on the telephone and said, 
"Come on right back to Los Angeles?" 

Mr. Cohen. That is right. 

Mr. Halley. And you said, "The police department wants to be 
shown that you are alive" ? 

Mr. Cohen. Not only for that reason. 

Mr. Halley. Did you take him to the police station and show the 
police that he was alive ? 

Mr. Cohen. Yes; I did. Well, I didn't take him to the police sta- 
tion. I had a Si-hour detail following me. 

Mr. Halley. All you had to do was wave Borden around and they 
would see him ? 

Mr. Cohen. I didn't know the detail knew about it. I said, "Here 
is a fellow some people are worrying about down at the station." 

Mr. Halley. In the middle of all this trouble you needed money 
enough to touch Borden for $400 and $1,000? 

INIr. Cohen. We have taken money from each other 30 or 40 times 
that way. I just took it for over the week end. 

Mr. Halijsy. Here was this man with his wrists cut ? 

Mr. Cohen. Yes. 

Mr. Halley. And in a terrible condition, but you took the trouble 
to take the money from him. I thought that you would have loaned 
him money under the circumstances. 

Mr. Cohen. I would loan him whatever he would vrant from me, 
whatever he would ask from me if I had it. This was nothing. This 
was money that he had. He didn't need it right at the moment. He 
received it back when he needed it. 

The Chairman. We will take our noon recess now\ The committee 
will stand in recess until 2 o'clock. 

(Whereupon at 12: 35 p. m., November 17, 1950, a recess was taken 
until 2 p. m. of the same day.) 



232 ORGANIZED CRIME. IN INTERSTATE COIVOIERCE 

(The committee reconvened at 2 p. m., pursuant to the taking of 
the noon recess. ) 

The Chaikman. The committee will come to order, please. Will 
you proceed to question the witness, Mr. Halley. 

FURTHER TESTIMONY OF MICHAEL (MICKEY) COHEN, 
LOS ANGELES, CALIF. 

ISIr. Halley. Oh, Mr. Cohen, is it still your contention that the Los 
Angeles Police Department was looking for Borden ? 

Mr. Cohen. What was that question'^ Is it still my what? 

Mr. Halley. Is it still your contention that the Los Angeles Police 
Department were looking for Borden ? 

Mr. Cohen. Yes ; they were. 

Mr. Halley. Who told you that they were? 

Mr. Cohen. I don't remember; I think their stool pigeon told me. 

Mr. Halley. Wliat is his name ? 

Mr. Cohen. I don't know who the fellow was. 

Mr. Halley. Had 3'ou heard from any official source that the police 
department were looking for Borden? 

Mr. Cohen. No. 

Mr. Halley. When you spoke to Lubin and Borden on the telephone 
from Los Angeles to Las Vegas, you urged them both to get Borden 
back to Los Angeles at once. Now, what time was that ? 

Mr. Cohen. I have no idea. 

Mr. Halley. It was after midnight on Saturday? 

Mr. Cohen. It was late in the morning. 

Mr. Halley. And probably closer to 3 or 4 a. m. ? 

Mr. Cohen. I think so; yes. 

Mr. Halley. What was the urgency to get Borden back to Los 
Angeles by 9 o'clock the next morning ? 

Mr. Cohen. There was no specified time to have him back. It was 
just that I was worried about the man ; that is all. 

Mr. Halley. The man was broke? 

Mr. Cohen, When he come back? 

Mr. Halley. Yes. 

JNIr. Cohen. I think he had a few dollars. 

Mr. Halley. Was he broke when he left ? 

Mr. Cohen. I can't answer that. I didn't know wiien he left. 

Mr. Halley. His worries were money worries ; were they not ? 

Mr. Cohen. I can't answer that. 

Mr. Halley. He was your good friend ; was he not? 

Mr. Cohen. No question about it. 

]Mr. Halley. And you were afraid that he might even kill himself? 

Mr. Cohen. That is true. 

Mr. Halley. Is that right? 

Mr. Cohen. Yes. 

Mr. Halley. What was on his mind ? 

Mr. Cohen. He declared it himself to many people; he always 
talked about it. 

Mr. Halley. What did he say ? Did he say that he was broke ; that 
he had been stuck on some bets? 

Mr. Cohen. He never told me that. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 233 

Mr. Halley. Was he afraid of anyone ? 

Mr. Cohen. I don't think he is afraid of anybody; no. 

Mr. Halley. What was he woiTied about? 

Mr. Cohen. We are talkino- about a person that I have known for 
quite a number of years. He is a very peculiar person. He is a 
fellow that can sit in his room for 3 or 4 days and have $5,000 in his 
pocket and eat that canned food and just sit there and listen to the 
radio without seeing or hearing from anybody. He is a peculiar man, 
and it is hard to explain about this person to anybody. He was a fellow 
that kept talking about — he had suicidal tendencies all the time. It 
is hard to explain about him. 

Mr. Halley. It is difficult for me to understand why it was neces- 
sary for him to come to the Mayan Hotel that very morning for you 
to meet him there. 

Mr. Cohen. One of his very closest friends lives there. 

Mr. Halley. Babe McCoy? 

Mr. Cohen. That is true. 

Mr. Halley. Were you to have a conference with him ? 

Mr. Cohen. I can enlighten you on this whole thing if you would 
like it. 

Mr. Halley. I would like it very much. 

INIr. Cohen. You are trying to clean up something here from the 
police department that doesn't even know what the situation was with 
this thing. They are guessing and listening to some people that are 
trying to give them information to get in good with them. This fellow 
was my very close friend. There was nobody as close to me as this 
man. It is ridiculous for this investigating committee to talk about the 
man. He is no bookmaker or anything like that at all. I can bring 
in 500 people to testify to that effect, big people, in the fight business 
and very respectable people. This is no man that should be involved 
with the police department. 

Mr. Halley. Is that the only explanation you have of his being 
rushed back to Los Angeles by Lubin in a chartered plane ? 

Mr. Cohen. He was not rushed back by Lubin. He was rushed back 
on his own accord. He wanted to come back after I got through speak- 
ing to him. Nobody rushed that man back. 

Mr. Halley. What did you say to him to make him want to come 
back? 

Mr. Cohen. I told him. "Eddie," I said, "you have everybody wor- 
ried here. You have my wife hysterical," Everybody thought he 
committed suicide. Everybodj^ was under that impression. 

Mr. Halley. Why was it necessary for him to be in Los Angeles? 
Las Vegas is a well-known resort. 

Mr. Cohen. He should be close to his friends. 

Mr. Halley. Did he have no friends in Las Vegas ? 

Mr. Cohen. I don't think so. He is a peculiar type of person. You 
can't explain him to a person that doesn't know him. 

Mr. Halley. I think you said he was there with Hymie Miller? 

Mr. Cohen. Las Vegas is a small place. He must have run into 
him. 

Mr. Halley. He knew Hymie Miller, did he? 

Mr. Cohen. I imagine he did. 

Mr. Halley. Miller is a bookmaker, isn't he? 

68958— 51— pt. 10 — —16 



234 ORGANlIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. Is that what you say ? 

Mr. Halley. Isn't that the fact? 

Mr. Cohen. That is what you say ; I don't know. 

Mr. Halley. You have heard it? 

Mr. Cohen. I have heard it ; yes. 

Mr. Halley. You certainly know he was indicted and is under in- 
dictment for bookmaking. 

Mr. Cohen. It was in the paper. 

Mr. Halley. Isn't it the fact that Borden owed over $4,000 on bets 
he had made? 

Mr. Cohen. How would I know? 

Mr. Halley. Didn't he tell you that? 

Mr. Cohen. He did not tell me that. 

Mr. Halley. You say you know Sammy Lewis ? 

Mr. Cohen. Yes. 

Mr. Halley. Did you have any discussion with Sammy Lewis as 
to whether Borden owed him any money ? 

Mr. Cohen. Not one solitary word. 

Mr. Halley. None whatsoever? 

Mr. Cohen. No. 

Mr. Halley. Isn't it a fact that Borden left Los Angeles and went 
to Las Vegas because he couldn't meet his debts on his bets? 

Mr. Cohen. Not that I know of. 

Mr. Halley. Didn't he tell you that? 

Mr. Cohen. He did not; no. 

Mr. Halley. Isn't it also the fact that he had no money ; that when 
he had to get some money for you and for himself he had to get checks 
from Nat Fleisher and from Al Weill ? 

Mr. Cohen. He has gotten money from Fleisher and Al Weill on 
20 different occasions. 

JNIr. Hali^y. Then he was broke and he had to send to New York 
for money ? 

Mr. Cohen. That is right. 

Mr. Halley. A thousand dollars for you and a thousand dollars 
for him ? 

Mr. Cohen. Yes. 

Mr. Halley. So if he owed $4,000 to people whose names I have 
here, he would have had a pretty good motive to leave Los Angeles 
in a hurry ? 

Mr. Strong. That is speculative. 

Mr. Cohen. I don't know. You are trying to clean something up 
for the L. A. police department and they have given you a lot of 
bum information. That is my answer. 

Mr. Halley. I am trying to get facts. 

Mr. Cohen. You have no facts. 

Mr. Halley. This committee is interested in the nature of your 
operations. 

Mr. Cohen. I am telling you, Mr. Halley, you have no facts. 

The Chair^ian. Just a minute, Mr. Cohen. Just answer the ques- 
tions, if you Avill. If you know the answer, just say so and answer the 
question. 

Mr. Cohen. I am trying to answer to my best ability. 

The Chairman. And if you do not know the answer, say so. 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 235 

Mr. Cohen. That is the answer — I don't know the answer. 

Mr. Halley. Then you got on the phone and urgently looked for 
Borden ; is that right ? 

]Mr. Cohen. I look for Borden all over ; yes, sir. 

Mr. Halley. You finally located him at Las Vegas in the early 
hours of Saturday morning? 

Mr. Cohen. No. I was told he was in Las Vegas. 

Mr. Halley. But you didn't locate him until the early hours of 
Saturday morning? 

Mr. Cohen. That is true. 

]Mr. Halley. In the meantime, you phoned out there and urged 
Lubin to find him? 

Mr. Cohen. That is right. 

Mr. Halley, Lubin rushed around town and found him ? 

Mr. Cohen. That is right. 

Mr. Halley. Then you got him back into Los Angeles right away? 

yiv. Cohen. I asked this man to come back here. 

]Mr. Halley. That is right; you asked Lubin to come with him too? 

Mr. Cohen. I didn't ask Lubin to come with him. I asked Lubin to 
see to it that he doesn't do any harm to himself. 

]Mr. Halley. And to be with him ? 

Mr. Cohen. That is not right. I did not ask him to be with him. 
I said for him to see that no harm comes to the fellow. 

]Mr. Halley. Isn't it a fact that Lubin told you they could come in 
on a regular plane and you told Lubin to charter a plane? 

Mr, Cohen. No, 

Mr. Halley. That is not the fact? 

Mr. Cohen. No. 

Mr. Halley. Is there no possibility that you may have forgotten 
the fact? 

Mr. Cohen. I say that is not the fact, to the best of my knowledge. 

i\Ir, Halley, You would know the fact? 

Mr. Cohen. I say it is not a fact. 

]Mr, Halley. It is a fact that the next morning you did meet Borden 
at the Mayan Hotel in Room 23.5, That is the fact; isn't it? You 
met him that same morning, Saturday morning? 

Mr, Cohen. I met him. It wasn't in the morning; no. 

Mr. Halley. You went to the bank before 12 o'clock wdth him? 

Mr. Cohen. That is right; yes. 

Mr. Halley. So you must have met him in the morning. 

]Mr. Cohen. I say it was in the afternoon. Maybe he got in the 
bank late. 

]Mr. Halley, Twelve o'clock is noon, isn't it ? 

Mr, Cohen. Yes. I can get into my bank any time I want, pretty 
near, up to 5 o'clock, 

Mr. Halley, You drove him to the bank. Was there any special 
arrangement to get into the bank or did he go right into the door ? 

Mr. Cohen. I don't know. 

Mr. Halley. You just walked out and got a shoe shine? 

Mr. Cohen. I sat in the car and when he didn't come back for a 
while I went and got a shine. 

Mr, Hatxey, Did he walk into the bank? 

Mr. Cohen. I don't know. 



236 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You saw him ; the car was right there ? 

Mr. Cohen. I did not see him. You are putting words into m^ 
mouth. 

Mr. Halley. How could you help seeing him ? 

Mr. Cohen. I was up the street. 

Mr. Halley. How far up the street ? 

Mr. Strong. Isn't that argumentative? 

Mr. Cohen. You ask me a question and you are answering it your- 
self. You are trying to answer the questions for me. Have I a right 
to answer my own questions ? Have I a right to answer the questions 
myself, Senator? 

The Chairman. He is asking you the questions. You answer the 
questions the best you can. 

Mr. Cohen. He is answering my questions for me. 

The Chairman. He is asking you if you know certain things. If 
you know them, tell us. 

Mr. Cohen. He took a police report 

The Chairman. That is all right. You just answer the questions. 

Mr. Cohen. He is trying to make me look as dirty as he possibly 
can ; the police department is trying to make me look as dirty as they 
possibly can. They have arrested me 50 or 60 times. On this report 
here, they can arrest 3^011 and put anything down that they want to on 
the report. 

The Chairman. Mr. Cohen, please just answer the questions. 

Mr. Cohen. All right, Senator. 

The Chairman, Where the committee gets information is not your 
concern. 

Mr. Cohen. I want to ask you this, Senator 

The Chairman. We will ask you the questions and you answer 
them. 

Mr. Cohen. I would like to ask you about this. They asked me 
about prostitution, about me and Joe Sica. Who was the prostitute? 
Me or Joe Sica ? 

Tlie Chairman. Never mind, Mr. Cohen. 

Mr. Cohen. Who was the prostitute ? Coppers pinch you and take 
you down and put you down for prostitution. 

The Chairman. Let me tell you something 

Mr. Cohen. They arrest you and they can put down anything they 
want to on the report. They even put you down for prostitution. 

The Chairman. I said let me tell you something, if you will. 

Mr. Cohen. I am sorry, sir. 

The Chairman. Counsel will ask you questions and you answer 
them if you know the answer. If you cannot answer the questions 
just say you don't know. 

Mr. Cohen. He won't let me say I don't know. He wants to answer 
my questions for me. 

The Chairman. We are getting along all right, if you will just 
answer the questions that he asks you. 

Mr. Halley. Take it easy; we wDl get along fine. Is it your con- 
tention that you got to the bank after 12 o'clock noon ? . 

Mr. Cohen. I said noon ; I don't know. 

Mr. Halley. Around noon? 

Mr. Cohen. That is right. I never made any arrangement with 
this man to cro to the bank. We started going out Eighth Street to the 



ORGANIZED CRIME IN INTERSTATE COMMERCE 237 

store. He said, ''Have we got time to go by the bank?" or something 
like that, or, "Will you take me by the bank?" I was talking to him 
all the time. I was saying, "Eddie, what is wrong with you?" He is 
a friend of mine. We didn't know what happened. Not only was I 
worried about the man, but I can bring you 20 people running around 
wild worrying about the man. If you knew the particular person 
you would know who I was talking about. This fellow is 100 percent 
legitimate, a 100 percent legitimate person. He has managed some 
of the greatest fighters in the country. 

Mr. Haley. He owed some people money, didn't he ? 

Mr. Cohen. How would I know ? I don't know about that. 

The Chairman. The point of the inquiry is that you were worried 
that he might commit suicide, or you were worried whether he was 
alive or not. You found him alive over in Las Vegas. 

Mr. Cohen. This is after 5 or 6 days, Senator. 

The Chairman. Then the question was : Why did you have to get 
him back here when you found out he was alive and over there all 
right, evidently everything was all right. That is what Mr. Halley is 
trying to get at. 

Mr. Cohen. Because there was a lot of confusion about the fellow. 

The Chairman. We understand there was confusion all right. 

Mr. Halley. I also want to know why you had to get $100 
from him that very morning that he came back. 

Mr. Cohen. He has taken money off me 20, 30 or 40 times, Mr. 
Halley, and I have taken it off of him. I needed the money over the 
week end. It was nothing. There were no two closer people than this 
man and I. 

Mr. Halley, I believe you testified that you are broke these days ; 
is that right? 

Mr. Cohhen. That is right ; yes. 

Mr. Halley. You have had a fairly large amount of money come 
through your hands this year, haven't you ? 

Mr. Cohen. Money come through my hands ? 

Mr. Halley. Yes. 

Mr. Cohen. You mean that I have borrowed ? 

Mr. Halley. Yes. 

Mr. Cohen. Yes ; I borrowed some money. 

Mr. Halley. You borrowed quite a bit, haven't you ? 

Mr. Cohen, Well, a fair amount of money; yes. 

Mr. Halley. How much ? 

Mr. Cohen. I don't know, but my accountant was up here with 
the figures. Every time I borrow money I call him and tell him I 
borrow. 

Mr. Halley. It is about $60,000 ? 

Mr. Cohen. I don't know if that is the figure or not; it is possibly 
around there. 

Mr. Halley. What happened to that $60,000? 

Mr. Cohen. I paid off a $25,000 bond. For the last 4 years I have 
been constantly in courts and under harassment by the Los Angeles 
Police Department, that is making it their business to see that I get 
broke. 

Mr. Halley. Wliat happened to the rest of the money ? 



238 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. I just got tlirougli telling you. I have been in court 
and that takes attorneys. This attorney here didn't come up here 
today for nothing either, j'ou know that. 

Mr. Halley, You were broke 2 weeks ago or 10 days ago when yoii 
had to borrow this money from Eddie Borden? 

Mr. Cohen. I borrowed it on different occasions. 

Mr. Halley. I presume at that time you hadn't paid your counsel 
here; you hadn't been subpenaed yet. Now, j^ou borrowed at least 
$60,000 this year? 

Mr. Cohen. Yes. 

Mr. Halley. You say you spent $25,000 for the bond on the man 
who disappeared ? 

Mr. Cohen. That is right. 

Mr. Halley. That would leave $35,000. 

Mr. Cohen. I don't Icnow. 

Mr. Halley. How did you spend the other $35,000 ? 

Mr, Cohen. On my living and I had a colored maid. 

Mr. Halley. How else ? 

Mr. Cohen. Lawyers' expenses ; troubles. 

Mr. H ALLEY. Is it all gone by now ? 

Mr. Cohen. All excepting what I have in my pocket. 

Mr. Halley. You have nothing in tlie world except what you have- 
in your pocket ? 

Mr. Cohen. That is right. 

Mr. Halley. What do you have in your pocket ? 

Mr. Cohen. $200 or $300 ; $285 or so. Yes. $285. 

Mr. Halley. That is all the money vou have left in the world? 

Mr. Cohen. $286, 1 mean. 

Mr. Halley. How do you expect to live from now on ? 

Mr. Cohen. I can get money. 

Mr. Halley. You borrow it ? 

Mr. CoiiEN. Yes. 

Mr. Halley. How much do you owe at this time. Mr. Cohen ? 

Mr. Cohen. Well, Senator, I am under investigation by the Internal 
Revenue now for the last 3 or 4 years. There has been some talk about 
it. 

The Chairman. Do you think telling how much you owe would 
incriminate you ? 

Mr. Cohen. I don't know. I am under investigation by the In- 
ternal Revenue Bureau now. I want your answer. Senator. 

The Chairman. I am just passing on objections, one way or the 
other. The question is how much do you owe at the jDresent time. 

Mr. Cohen. Is that a proper question to answer, if you are under 
investigation by the Internal Revenue ? 

The Chairman. In my opinion, the fact that 3^ou owe some money 
doesn't make you guilty of any crime, but if you have other opinions 
about it you can consult with your attorneys to see what you want 
to do. 

Mr. Cohen. I would say about $300,000. 

Mr. Halley. When did you start borrowing these large amounts 
of money ? 

Mr. Cohen. When I started having trouble. 

Mr. Halley. When was that ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 239 

Mr. Cohen. I would say about 3y? or 4 years ago. 

Mr. Halley. About 1945 ? 

Mr. Cohen. Around there I imagine, yes. 

Mr. Halley. You found that from then on you were not able to live 
on your earnings ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. You did earn certain substantial amounts of money 
each year, did you not ? 

Mr. Cohen. That is right. 

Mr. Halley. Why were you not able to live within your means ? 

Mr. Cohen. When j^ou have to hire attorneys and pay bonds and you 
have court troubles, money is of no value. 

Mr. Halley. We have your expenses here listed by your auditor. 
They don't show any attorney fees. 

Mr. Cohen. They must show attorney fees somewhere. 

Mr. Halley. Let s take the last year for which expenses are itemized. 
They show food, $2,600. 

Mr. Cohen. Yes. 

]\Ir. Halley, Clothing something like $3,900. Would that be about 
right? 

Mr. Cohen. I presume so, if it is on the thing there. 

Mr. Halley. Without going through it item by item, there is jew- 
elry, automobiles, entertainment, servants, miscellaneous, gardener, 
cost of house, furniture, medical and dental, business loans and invest- 
ments, and taxes. I don't see any item for attorney fees. Do you 
know whether there were any ? 

Mr. Cohen. If it is not on there there probably wasn't that year or 
I paid it the year following or something like that. 

Mr. Halley. I just don't see them in here. 

Mr. Cohen. At times I didn't have money to pay the attorneys and 
I paid it at different times. 

Mr. Halley. In certain years you earned fairly substantial sums, 
did you not ? 

Mr. Cohen. That is right. 

Mr. Halley. In 1948 you earned 

Mr. Strong. May I ask this, I believe there is an Internal Revenue 
investigation and the newspapers indicated that part of this is going 
to go into his income and so forth. I do not think he should answer 
any questions that are under investigation by the Internal Revenue 
Bureau. 

Mr. Halley. No question has been asked. You have the right to 
object to any specific question that is asked. 

The Chairman. I think I should state for your benefit, that the 
information Mr. Halley is looking at, the memorandum, did not come 
from the Internal Revenue Department. That was brought in by 
Mr. Cohen's auditor under subpena of this committee. 

Mr. Strong. My point simply was since there is an investigation 
by the United States Government that perhaps the questions wouldn't 
be proper. 

The Chairman. Let Mr. Halley ask the question and then j^ou advise 
your client to answer or not. 

]Mr. Strong. I understand the immunity statute applies if he does 
not object. 



240 ORGANiIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. You have to claim your immunity. That is, if he 
answers without my directing liim to answer he lias no immunity. 

Mr. Strong. On behalf of my client I would like to claim all the 
benefits of the immunity statutes as to any questions asked here. I 
am not talking about self-incrimination, but the immunity statute 
which deals with witnesses before congressional committees. 

The Chairman. We will have to ask you to make your specific objec- 
tions to specific questions. 

Mr. Strong. We are not objecting to specific questions. We are 
making the general request under the immunity statute as to anything 
brought out by the Federal Government, or that might be under in- 
vestigation by the Federal Government. 

The Chairman. You have made your claim in the record. In order 
to avail yourself of the immunity statute you will have to make specific 
objections at the time the question is asked. 

Mr. Strong. My understanding is the statute applies even if you 
don't ask for it. 

The Chairman. That will have to be settled by the courts then, 

Mr. Hallet. In the year 1947, you reported earnings of $29,483, 
did you not ? 

Mr. Strong. May I consult with him for a moment ? 

The Chairman. Yes. Do you want to answer the question or not? 

Mr. Strong. May we have the question repeated ? 

(The question was read by the reporter.) 

Mr. Cohen. Yes, sir. 

Mr. Halley. That would be one-half of the actual earnings because 
your wife would, under the community property rule, be able to file for 
half of the earnings ; is that correct ? 

Mr. Cohen. I don't know what he is asking me. I don't know any- 
thing about those things. 

Mr. Halley. Did you not actually earn something like $60,000 in 
the year 1947, of which you reported half and your wife reported half? 

Mr. Cohen. Then it must be so. 

Mr. Halley. Do you have no independent recollection of your own 
earnings ? 

Mr. Cohen. None whatsoever. I don't know anything about those 
books or them things. 

Mr. Halley. In the year 1947, could you and your wife not live 
on $60,000 without borrowing huge sums of money from others ? 

Mr. Cohen. What has that to do with the investigation ? 

The Chairman. He is asking you whether or not you could have 
lived on that amount. 

Mr. Cohen. I couldn't live on it. 

Mr. Halley. In the year 1947, you borrowed from Arthur Seltzer 
$25,000? 

Mr. Cohen. I think so. I borrowed $25,000 ; I don't know the spe- 
cific date. 

Mr. Halley. Wlio is Arthur Seltzer ? 

Mr. Cohen. A manufacturer of ladies' handbags. 

Mr. Halley. How long have you known him ? 

Mr. Cohen. I would say 12 or 14 years ; 10 or 12 years. 

Mr. Halley. Where does he live ? 

Mr. Cohen. In Poughkeepsie, N. Y. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 241 

Mr. Halley. Did you phone him or write to him or go to see him 
to arrange this loan ? 

Mr. Cohen. I can't remember those things. He was here ; he came 
here with his wife and spent some time at my home with me on four or 
five different occasions. I can't recall all those details. 

Mr. Halley. That is a substantial amount of money; is it not? 

The Chairman. The question is, JNIr. Cohen : What arrangements 
did 3^ou make to borrow the money from him ? Did you call him up 
on the phone or did you go to see him ? 

Mr. Cohen. I can't answ^er that truthfully; I don't know. It is 
quite some years back. 

The Chairman. 1947? Even for a man in the money like you, 
$25,000 is a lot of money. If you remember how you made the ar- 
rangements, as you should remember it, I want you to tell us about it, 

Mr. Cohen. I am sorry that you think I should remember it, but 
I don't remember it. 

Senator Tobey. When you borrowed the different sums of money 
referred to here did you give your own notes, personal promissory 
notes ? 

Mr. Cohen. I have never given a note ; I think I gave one note for 
money in all my life. 

Senator Tobey. You borrowed it on a friendly basis? Who kept 
a record of the money you borrowed ? 

Mr. Cohen. My accountant. I borrowed $35,000 from the president 
of a bank with no note. 

Senator Tobey. Was that the Pennsylvania Exchange Bank in New 
York? 

Mr. Cohen. No; the Hollywood State Bank in this city. 

Senator Tobey. Supposing you borrow $25,000 from me, what 
would I receive from you ? Nothing but good will ? 

Mr. Cohen. That is what they must have thought. 

Senator Tobey. Supposing you passed away in the interim, they 
would have had nothing to show for it ; is that right ? 

Mr. Cohen. That is right. 

Senator Tobey. The $300,000 is represented by nothing tangible? 

Mr. Cohen. That is right; most of it. I think I have given one 
or two notes ; possibly three notes. 

Senator Tobey. How much money did you borrow from the bank 
president ? 

Mr. Cohen. $35,000. 

Senator Tobey. You gave him no note? 

Mr. Cohen. No. 

Senator Tobey. Was it bank money or his own personal money? 

Mr. Cohen. His own. It has been investigated, Senator. It is 
under the Internal Revenue Department. This president at this bank, 
I have loaned money from him maybe five or six different times. If 
I went in to him and offered him $35,000 to just say he loaned me 
$35,000, he wouldn't do it. That is the type of person he is. 

The Chairman. Let's ask him who that is. 

Mr. Cohen. It is Mr. Brown at the Hollywood State Bank. 

Senator Tobey. In the days when they used to have these old- 
fashioned writing books with the copper plate on top, there is some- 
thing on that that said "Character is the basis of credit." 



242 ORGANlIZED CRIME. IN INTERSTATE COMMERCE 

Mr. Cohen. I have had some people say that they would rather 
loan me money without a note than they would other persons with 
a note or some other security. 

Mr. Halley. What is the basis of that, Mr. Cohen? 

Mr. CoHEN". Because I have tried to pay everybody back. Every one 
of these persons who have loaned money have loaned money when I 
liave terrible troubles, court troubles and troubles where I was fighting 
for my freedom. A lot of these people believe that it was only a case 
of harrassment and just the police department trying to cover up for 
their own dirty work, which you are helping them out right now. 

Mr. Halley. You don't believe you have ever engaged in any dirty 
work? 

Mr. Cohen. I absolutely do not. I don't say that I have been an 
angel all my life, but I do say this, that I have tried to overcome every- 
thing that I have done in my life. 

Mr. Halley. Don't you believe that the United States Senate com- 
mittee investigating organized crime should be looking into your 
activities and should be trying to find out what you have been doing ? 

Mr. Cohen. Yes, I do. Now, I am only too happy to answer every 
or any question for the Senate committee with the greatest respect. 

Mr. Halley. I think you shouldn't refer, then, to "dirty work" on 
the part of the police department or anyone else. 

Mr. Cohen. You don't know what you are doing, Mr. Halley, if you 
w-ant my true opinion. Do you want me to express it ? You are trying 
to clean up a lot of dirty work for people who are trying to cover up 
for themselves. 

Mr. Halley. What are they trying to cover up ? 

Mr. Cohen. I don't know what they are trying to cover up. Every 
time that something comes up where they want to get it in the papers, 
1 am the best medium for them. All they have to do is throw some- 
thing at me. 

Mr. Halley. I don't think you should be vague. I think as a citi- 
zen, if you think something is being covered up, you should say so. 

Mr. Cohen. I am the greatest newspaper copy in this city and they 
have used me for any kind of a purpose. Ninety percent of the people 
in the city will tell you that. 

Senator Tobey. In a Senate committee hearing on interstate com' 
merce, we had another gentleman of the same profession come before 
us. His name was Frank Costello. I began to question him and in 
all pomposity he beat his breast and said, "I am front-page stuff. 
Every time I speak, the papers carrj^ it on the front page.'' That is 
called egotism. 

Mr. Cohen. That happens to be my case and not egotism. I can 
spit on the sidewalk and it will be in the headlines. 

Senator Tobey. I won't say any more at this time. 

Mr. Cohen. These are actual facts. 

Mr. Halley. Can we get back to your credit ? Money is factual and 
we can talk about figures. 

Mr. CoiiEN. I want to say one thing to you. The State crime com- 
mission came out with a statement that I own a home that is worth 
$200,000. Now, I will make this statement right openly here, anybody 
in this room can buy the house for $40,000. 

INIr. Halley. What did you pay for it ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 243 

Mr. CoiiEX. I will take $10,000 for the house right now. I x^aicl 
^'32.000. How can I overcome those kind of exaggerations? 

Mr. Halley. What improvements did you put into it? 

Mr. Cohen. Very little. 

Mr. Halley. Well, what ? 

Mr. Cohen. Maybe $10,000 worth of improvements; maybe $15,- 
000. I will take $40,000 for the house. 

]Mr. Halley. Your record shows you put $48,880.34 into furniture, 
renovations, and house repairs. 

My. Cohen. Are you talking with furniture? I am not talking 
with furniture, I am talking about the house that they claim is worth 
$200,000, this mansion that I paid $32,000 for. 

jMr. Halley. Is there a mortgage on the house ? 

Mr. Cohen. Yes, there is. 

Mr. Halley. How much? 

Mr. Cohen. $12,000. 

]Mr. Halley. That brings the cost of the house up to $44,000. 

]Mr. Cohen. Xo. The cost of the house was $32,000 with the mort- 

Mr. Halley. Your disbursements show that you paid $33,520 in 
actual outlav for that house. Is that wrong? Should that be re- 
duced to $21,000? 

Mr. Strong. Are we going into income tax matters here? 

]Mr. Halley. He volunteered it. He said the cost of the house was 
misrepresented. We are now trying to find out what the house cost. 

Mr. Cohen. The house cost me $33,000 and I got a mortgage of 
$12,000 on it. 

Mr. Halley. So that is $45,000 that it cost? 

Mr. Cohen. No ; I paid $33,000 with the mortgage. 

Mr. Halley. Then j'ou put $48,880 into furniture, renovations, and 
repairs? 

Mr. Cohen. If that is on there that is probably what it is. 

Mr. Halley, How much was for furniture and how much for im- 
provements on the house ? 

Mr. Cohen. I can't answer that; I don't know offhand. There 
is a record there, I guess. 

Mr. Halley. In any event, the total cost is $82,000 for the home 
you live in with its furnishings; is that right? 

Mr. Cohen. Probably so. 

Mr. Halley. And that money was spent in the year 1947? 

Mr. Cohen. That is probably right. 

Mr. Halley. You have said your credit is very fine. 

Mr. Cohen. It is not so fine right now. Of course, when you owe 
so much money it becomes harder to get money. 

Mr. Halley. You stated the reason you had to borrow all this 
money was to pay your lawyers. 

Mr. Cohen. These aren't the only lawyers I have. I have lawyers 
like Jerry Giesler, Ferguson, and Sammy Rummel. 

Mr. Halley. I am trying to show that your money went to other 
jDeople besides lawyers. Take the year 1947. You borrowed how 
much money in 1947, do you know ? 

]V[r. Cohen. I don't know offhand, the exact figure. 



244 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. $150,000, did you not ? 

Mr. Cohen. I think that is about it. 

Mr. Halley. About $80,000 of that went into a new house and 
furnishings ? 

Mr. Cohen. That is right. 

Mr. Halley. You did not use that to pay lawyers ? 

Mr. Cohen. I have been embarrassed many times by people. Peo- 
ple would embarrass me by asking me to move from an apartment 
so I finally had to get my own home even though I did not want to. 

Mr. Haixey. Is it your position now that you were not able to stay 
in an apartment ? 

Mr. Cohen. That is the real reason ; yes. 

Mr. Halley. Why? 

Mr. Cohen. Because of the notoriety. 

Mr. Halley. Perhaps they were afraid of being shot at. 

Mr. Cohen. That could be possible too. 

Mr. Halley. In any event, vou couldn't find a house cheaper than 
$35,000? 

Mr. Cohen. That was during the war and a house for $33,000 

Mr, Halley. The war ended in 1945. 

Mr. Cohen. It was during the war conditions. 

Mr. Halley. Then you found it necessary to go out and spend 
another $48,000 for furnishings ? 

Mr. Cohen. That is right ; yes. 

Mr. Halley. You found it necessary to borrow from your friends? 

Mr. Cohen. At that time I didn't know that other troubles were 
going to pile up on me. I thought I would be able to take care of 
some of these things. 

Mr. Halley. How many of these early debts have you paid back? 
Do you know whether or not you have paid back Tony Palasso ? 

Mr. Cohen. I never paid him back. 

Mr. Halley. Did you pay back Jay Copeland? You borrowed 
some money from him in 1945. 

Mr. Cohen. No, sir. 

Mr. Halley. Did you pay back Lubin ? 

Mr. Cohen. At different times. I have paid him back; yes. He 
has taken money from me. It would be too difficult for me to answer 
the question truthfully. 

Mr. Halley. Then in 1947, you borrowed $25,000 from Seltzer; 
did you ever pay that back ? 

Mr. Cohen. 1 paid him back some of it. 

Mr. Halley. How much? 

Mr. Cohen. I don't know exactly. Whenever I have paid him 
some amount of money it has always been on there, on the record 
somewhere. 

Mr. Strong. In connection with these questions relating to income, 
I would like the record to show that an assistant United States attor- 
ney by the name of Lavine, who prosecutes cases for the Government 
is taking notes in the court room. 

The Chairman. This is a public hearing. 

Mr. Strong. I make that statement in connection with our claim for 
immunity. 

Mr. Halley. You borrowed $15,000 from Charles Yolnosky in 1947. 
Have you paid that back yet ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 245 

Mr. Cohen. No. 

Mr. Halley. And from Charles Schiiester, you borrowed $10,000 in 
1 947. Have you paid that back ? 

Mr. Cohen. I still owe him. 

Mr. Halley. Babe McCoy, $5,000. Have you paid that back ? 

Mr. Cohen. No, sir. 

Mr. Halley. Sam Rothman, $3,000; have you paid that back? 

Mr. Cohen. No, sir, 

Mr. Halley. And Harry Rothman, $15,000; have you paid that 
back? 

Mr. Cohen. No, sir. 

Mr. Halley. Did you pay that back ? 

Mr. Cohen. No, sir. 

Mr. Halley. Did you borrow $25,000 from Bugsy Siegel ? 

Mr. Cohen. That is right. 

Mr. Halley. Did you pay that back ? 

Mr. Cohen. No, sir. 

Mr. Halley. Were you on pretty friendly terms with Bugsy Siegel 
in 1947? 

Mr. Cohen. Very good terms. 

Mr. Halley. And from Jack Copeland you borrowed $30,000 ? 

Mr. Cohen. I think that is the figure, yes. 

Mr. Halley. You haven't paid these sums back at all, have you ? 

Mr. Cohen. No, sir ; I haven't been able to. 

Mr. Halley. But your credit is still good ? 

Mr. Cohen. That is true ; yes. 

Mr. Halley. So that in the year 1948, you were able to borrow 
approximately $80,000 ? 

Mr. Cohen. That is right ; I am still borrowing. 

Mr. Halley. Already in 1950, you were able to borrow $60,000 ? 

Mr. Cohen. That is right. 

Mr. Halley. How do you maintain your credit without paying back 
your creditors ? 

Mr. Cohen. I told you my credit is getting a little weak. 

Mr. Halley. How did you ever develop such credit, Mr. Cohen ? 

Mr. Cohen. How did I develop it ? 

Mr. Halley. That is a serious question. Prior to 1945 your earn- 
ings were quite low, weren't they ? 

Mr. Cohen. I think they were ; yes. 

Mr. Halley. We have your tax returns, which were subpenaed from 
your accountant here. I think they show for the year 1944 a total 
income of $6,500, for yourself and, of course, there would be $6,500 
for your wife. 

Mr. Cohen. That is right. 

Mr. Halley. For 1943 only $3,800 ; is that correct ? 

Mr. Cohen. Yes. 

Mr. Halley. For the year 1941 you show no income at all ; is that 
right? 

Mr. Cohen. That is probably right. 

Mr. Halley. Now, in 1945 when your income did go up to $12,266 
for yourself and the same for your wife, you found it necessary to 
borrow an additional $35,000? 

Mr. Cohen. That is probably right. 



246 ORGAN'IZED CRIME IX INTERSTATE COMMERCE 

Mr. Halley. Did your living expenses go up so swiftly ? 

Mr. Cohen. I live pretty high. 

Mr. Halley. You live pretty high ? 

Mr. Cohen. That is right. 

Mr. Halley. How high do you live, Mr. Cohen ? 

Mr. Cohen. I live as good as I can ; that is all. 

Mr. Halley. I think you mentioned buying an automobile this 
year ? 

Mr. Cohen. Yes. 

Mr. Halley. And having it made specially; having it made as a 
special automobile; is that correct? 

Mr. Cohen. That is right. 

Mr. Halley. What did that cost you ? 

Mr. Cohen. I think around $16,000. 

Mr. Halley. $16,000? 

Mr. Cohen. Yes. 

Mr. Halley. When did you have that made ? 

Mr. Cohen. It has been under construction for the last 6 or T 
months. 

Mr. Halley. Is it finished ? 

Mr. Cohen. Not all finished yet ; no. 

Mr. Halley. Is it another armored automobile ? 

Mr. Cohen. When I say it cost me $16,000 I haven't paid for all 
of it yet. 

Mr. Halley. It is still being finished up for you ? 

Mr. Cohen. There are some other people who have investments in it» 

jNIr. Halley. Who? 

Mr. Cohen. The Coachcraft people. 

Mr. Halley. Who else ? 

Mr. Cohen. Them people. 

Mr. Halley. What is the automobile for? Is it for a special use? 

Mr. Cohen. It is for my protection. 

Mr. Halley. It is for your protection, is it ? 

Mr. Cohen. Yes. 

Senator Tobey. Is it bulletproof? 

Mr. Cohen. Yes. 

Mr. Halley. You have one bulletproof automobile already, do you 
not? 

Mr. Cohen. I do not; no. 

Mr. Halley. Didn't you recently get a bulletproof automobile ? 

Mr. Cohen. That is the one we are talking about. 

Mr. Halley. I thought that one was finished. 

Mr. Cohen. Not completely ; no. 

Mr. Halley. What is there left to do to it? 

Mr. Cohen. There is a lot of work left to be done with it. The 
inside isn't completely finished. When we were turned down for the 
permit we didn't finish it. 

Mr. Halley. You tried to get a permit for it and you were turned 
down ? 

Mr. Cohen. That is right. 

Mr. Halley. Are you still finishing it up ? 

Mr. Cohen. They are leaving it lay there until we see what happens 
with the writ for the permit. 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 247 

Mr. Halley. You incurred all these expenditures. Apparently you 
are quite confident that you can continue to borrow money at the same 
rate as in the past ? 

Mr. Cohen. When a man tries to protect his family and himself 
he strains himself to borrow money to take care of those things. I 
retain two guards on my home today, which I can't afford. 

Mr. Hai.ley. What do you pay them ? 

Mr. CoiiEX. I pay them different sums. 

Mr. Halley. Well, what? 

Mr. Cohen. $125 or $130. 

Mr. Halley. A week? 

Mr. Cohen. Yes. 

Mr. Halley. Each? 

Mr. Cohen. No ; for both of them. 

Mr. Halley. $130 a week for the two of them ? 

Mr. Cohen. Maybe $140 some weeks. 

Mr. Halley. What are their names ? 

Mr. Cohen. Hawkins, I call him; I don't know his first one. The 
other one's name is Anderson. They are certified guards, licensed by 
the State. 

Mr. Halley, How long have you had guards ? 

Mr. Cohen. Since the bombing of my home. 

Mr. Halley. When was that ? 

Mr. Cohen. I don't know the exact date. 

Mr. Halley. When was yoiw home bombed, don't you remember 
that? 

Mr. Cohen. I don't know. 

Mr. Halley. Just what happened? Was it this year? 

Mr. Cohen. Yes. 

Mr. Halley. Was it before the shooting or after the shooting ? 

Mr. Cohen. After. 

Mr. Halley. I am referring to an occasion when you were with 
Neddie Herbert and he was shot. 

Mr. Cohen. It was after that. 

Mr. Halley. Your home was bombed after that ? 

Mr. Cohen. Yes. 

Mr. Halley. Were there any other attempts made on your life? 

]\Ir. Cohen. Yes, sir. 

Mr. Halley. What were they ? 

Mr. Cohen. I was shot at when I turned into my home one day to 
go home. 

Mr. Halley. You were in an automobile? 

Mr. Cohen. Yes. 

Mr. Hallea'. And some bullets went through the back window of 
the automobile? 

Mr. Cohen. Two shotgun slugs through the back and two through 
the front. 

Mr. Hallea'. On that occasion you went through elaborate means to 
keep tlie police from knowing that you were shot at, did you not? 

Mr. Cohen. No, sir; I did not. 

Mr. Hallea'. Do you recall having been questioned at the inquest 
on the killino: of Neddie Herbert ? 



248 ORGANHZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. There were some police looking to do me harm that 
I wouldn't speak to at all. 

Mr. Halley. I am talking about your questioning by the coroner 
at the coroner's inquest. 

Mr. Cohen. Yes. 

Mr. Halley. Do you recall having been asked whether there were 
any prior attempts on your life? 

Mr. Cohen. I got out of a sickbed to go to the coroner's inquest 
and I was told to answer and that is how I answered. 

Mr. Halley. Who told you how to answer ? 

Mr. Cohen. I was advised by my attorneys. 

Mr. Halley. Who were your attorneys ? 

Mr. Cohen. Ferguson and Rummel. 

Mr. HiVLLEY. What are their full names ? 

Mr. Cohen. I don't know their full names; Sammy Rummel. I 
don't know the other guy's full name. 

Mr. Halley. Which one advised you to say you didn't know 
whether or not you knew your automobile had been shot at? 

Mr. Cohen. They didn't advise me speciiically. 

Mr. Halley. Just what was the advice, Mr. Cohen ? 

Mr. Cohen. They knew I wasn't feling well and they advised me 
to go through the thing as best I could. That is the way I thought 
was the best way to do it. 

Mr. Halley. Did they advise you not to give the police any help ? 

Mr. Cohen. Absolutely not. 

Mr. Halley. I thought that was the implication of what you said 
a few minutes ago. 

Mr. Cohen. They have been 100 percent to give the police help. 

Mr. Halley. Do you recall having been asked a question : 

Q. There were soroe other attempts made, were there not? — A. I don't know. 
Q. Let me ask you this : the automobile you were in one night was hit by a 
couple of bullets, wasn't it ?• — A. I don't know. 

Mr. Cohen. If it says that there that must be true. 

Mr. Halley. You were not telling the truth on that occasion ? 

Mr. Cohen. Maybe at that time I didn't know. 

Mr. Halley. Of course you knew, didn't you ? 

Mr. Cohen. You say "Of course I knew." You are answering my 
questions again. 

The Chairman. The question is whether you knew. 

Mr. Cohen. I say at that time I didn't know. I got out of a hospital 
bed to go to this hearing. 

The Chairman. The question is whether you knew whether shots 
were shot at your automobile and whether you just knew that. 

Mr. Cohen. Maybe I didn't know what they were. 

Mr. Halley. You know it now, don't you ? 

Mr. Cohen. That is right. 

Mr. Halley. Why shouldn't you have known it then ? 

Mr. Cohen. I was in an upset condition then. 

Mr. Halley. Are you in an upset condition now ? 

Mr. Cohen. No. 

Mr. Halley. Fine. 

Senator Tobey. You have had many attempts on your life? 

Mr. Cohen. I have had possibly five, Senator. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 249 

Senator Tobey. Do yovi live in constant fear of another attack on 
yonr lif e ? 

Mr. Cohen. I think so ; yes, sir. 

Mr. Halley. Why should anyone want to kill you ? 

Mr. Cohen. I would like to tind that reason out myself. 

Mr. Halley. You must have some theory. That is one of the things 
that this committee is very interested in. 

Mr. Cohen. You are ansAverino- the question again. I have no 
theory. I spent thousands of dollars trying to find out. 

Mr. Halley. I am urging you, as a citizen, to help this committee 
find out why people are trying to kill you. 

Mr. Cohen. I wish I could help. Maybe not for myself, but I 
would like to help for my family. 

Mr. Halley. Do you have any idea at all ? 

Mr. Cohen. No idea. Well, many a thought has run through my 
mind at different times, but they were just thoughts a person would 
have about different things that there is no basis for them. 

Mr. Halley. Have you ever had a business transaction with anybody 
who might, as a result of that, want to make an attempt on your life '^ 

Mr. Cohen. That is what makes it so hard. I can't picture anybody 
that I have had any business dealings with that would go to that 
extreme. 

Senator Wiley. Are all these people you have borrowed money 
from, that you haven't paid back, are they all still friends of 3'ours? 

JNIr. Cohen. My very best. I could possibly call on them for more 
help if I need it. 

Senator Wiley. With your backgTound that you have had in differ- 
ent cities, and your knowledge of gangsterdom, you certainly have 
some idea who is trying to kill you and some reason for it? 

Mr. Cohen. I give you my word of honor, as a man, that I haven't 
the slightest idea that there is any basis for it. I have been pretty good 
to a lot of people and it is hard to figure out. That is what makes this 
thing so tough. I have spent thousands upon thousands of dollars try- 
ing to get information. I have sent people throughout the country. 
I spent borrowed money trying to find out. 

Senator Wiley. Who did you send and where did you send them? 

Mr. Cohen. I have sent an investigator by the name of — I can't 
think of his name right offhand. 

Senator Wiley. To whom did you send him? 

Mr. Cohen. Just to different places to see if he could pick up any in- 
formation. 

Senator Wiley. Can't you make it more concrete? You probably 
knew or had an idea. 

Mr. Cohen. I sent him to different cities to see if he could pick up 
some information, and to see if he could pick anything up. I have been 
in a quandry about this thing. He is an investigator licensed by the 
State. 

The Chairman. Let's call him Mr. X. 

Mr. Cohen. Probably one of the newspapermen knows who he is. 

Mr. Strong. We will supply it in a letter to the committee. 

Senator Wiley. What caused you to send him, to send Mr. X, to 
certain cities, and what cities, and what particular agency or group or 
gang did you send him to? 

68958— 51— pt. 10 17 



250 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. He sold me a bill of goods that he may be able to find 
something out. That is his business. He was an investigator. I was 
anxious enough to take the chance that maybe something would come 
out. 

The Chairman. Was it Mr. Kuditsky? 

Mr. Cohen. No, sir. 

The Chairman. How much did you pay him, do you remember? 

Mr. Cohen. I can't remember; it was different sums. 

The Chairman. To what cities did you send him ? 

Mr. Cohen. He was on his own really. He sold me a bill of goods 
that he could find some information out and he went ahead on his own. 

The Chairman. Then you must have thought it was somebody in 
cities other than Los Angeles, people in other cities that were trying 
to kill you? 

Mr. Cohen. I was just trying to find out. Senator. 

The Chairman. Why did you send him out of Los Angeles ? Did 
you fear someone outside of Los Angeles ? 

Mr. Cohen. We wouldn't get no information here. We were just 
blundering around trying to get some kind of information. 

The Chairman. All the attacks on your life 

Mr. Cohen. I must have answered a couple of htmdred calls from 
different people, absolute strangers to me. 

The Chairman. Haven't all of the attempts or attacks on your life, 
attempts on your life, been made in Los Angeles? 

Mr. Cohen. Yes, sir. Senator ; they have been. 

The Chairman. Why would you send somebody outside of Los 
Angeles to find out who it was ? 

Mr. Cohen. Just trying to piece something together. 

The Chairman. Did you send him to New York or Chicago ? 

Mr. Cohen. He was on his own ; he went to different cities. He sold 
me a bill of goods. 

Senator Wiley. You used an expression "piece something together." 
Piece what together? 

Mr. Cohen. Who was doing the shooting or making the attempts 
of my life. 

Senator Wiley. Didn't you have in mind piecing something to- 
gether that, perhaps, he could find out that some gang or some 
gangsters representing some other gang was muscling in on your 
business ? 

Mr. Cohen. No. It couldn't come to my mind, Senator, because 
I haven't been in connection with any so-called gangs whatsover. 

Senator Wiley. I didn't say you had been. I thought perhaps, some- 
one was trying to muscle in on your business. 

Mr. Cohen. That has been suggested to me, but I have nothing that 
anybody could muscle away from me. I have no gambling places 
operating. I have no books operating. There is nothing like the 
numbers business in this part of the country, like in other parts of the 
country. I have nothing that anybody would be interested in taking 
away. 

Senator Wiley. I was interested in some of the preliminary state- 
ments or questions that were being asked when I came in, to the effect 
that you borrowed money without even giving a note. 

Mr. Cohen. That is true, in most of the cases. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 251 

Senator Wiley. Was that to a State bank or to a national bank? 
Mr. Cohen. To a president of a bank, a high-class man. 
Senator Wiley. A loan just between individuals and not between 
you and the institution? 

Mr. Cohen. Just between him and I. He loaned me his own per- 
sonal money. 

Senator Wiley. You haven't paid that back yet ? 
Mr. Cohen. No, sir. 
Senator Wiley. How much was that? 

Mr. Cohen. $35,000. I still borrow a thousand now and then and 
pay him back and then borrow more. 

Senator Wiley. How many years ago was the $35,000 borrowed? 
Mr. Cohen. It wasn't all in one sum, but it is in the record here. 
Senator Wiley. Do you know if he borrowed the money from the 
bank in order to pay you or loan it to you ? 

Mr. Cohen. I don't think so; not this man. He is a very fine man. 
He just happens to like me. 

The Chairman. Do you pay these people interest? 
Mr. Cohen. No, sir. He has been questioned by the Internal Reve- 
nue Department. 

The Chairman, That is not the question. Do you pay these people 
interest on the money you borrow ? 

Mr. Cohen. I do not pay them interest. 
The Chairman. Do they ask for any interest ? 
Mr. Cohen. No, sir. 

The Chairman. What do you do for them that makes them so 
generous with you ? 

Mr. Cohen. I can't answer that ; they must just like me. 
The Chairman. How do they get to know you so well ? It is quite 
a charm to be able to borrow $35,000 with no note, no interest and no 
record. 
Mr. Cohen. But that happens to be the fact, Senator. 
The Chairman. Do you keep any i^cord of it anywhere? 
Mr. Cohen. With my accountant. 

The Chairman. You just call him up and say, "I borrowed $35,000 
from Mr. Brown" ? 
Mr. Cohen. That is right. 

The Chairman. Do you write Mr. Brown about it ; do you exchange 
letters about it ? 

Mr. Cohen. No. I just borrowed $13,000 from a fellow that owns 
some supermarkets in the city. 
The Chairman. Who is that ? 

Mr. Cohen. A man by the name of Klishka. The Bureau of In- 
ternal Revenue has investigated him. He gave me his card and I 
marked $13,000 taken off of him, and the date, and give it to my 
accountant. 

The Chairman. Do these people give you the money in a check ? 
Mr. Cohen. Some of them. Senator. 

The Chairman. How about this $35,000 from Mr. Brown, the presi- 
dent of the bank, w^as that in a check ? 
Mr. Cohen. Cash. 

The Chairman. You just went up there and got it ? 
Mr. Cohen. It was different loans, Senator; $15,000 and $20,000' 
and different loans. He didn't give it all to me at one time. 



252 ORGANIZED CRIlVfE. IN INTERSTATE COMMERCE 

The Chairman, He was just passing around money without any 
record at all as to how much it was ? 

Mr. Cohen. That is right. 

Senator Wiley. Did you ever have any stock in this market or- 
ganization that you have referred to ? 

Mr. Cohen. No ; I did not. 

The Chairman. Proceed, Mr. Halley. 

Mr. Halley. You did have some income in 1949, didn't you. 

Mr. Cohen. If it is on the record there ; I don't know. 

Mr. Halley. It shows about $15,000, of which $10,000 you just put 
down as "various commissions." 

Mr. Cohen. Yes. 

Mr. Halley. Would you tell the committee what the various com- 
missions were? 

Mr. Cohen. On bets that I won and bets that I move for people. 

Mr. Halley. Do you still handle bets for people ? 

Mr. Cohen. No ; I haven't been able to. I have got cops that put 
me to sleep and wake me up in the morning. If I wanted to I 
wouldn't be able to. 

Mr. Halley. "Wlien did you last handle bets ? 

Mr. Cohen. I imagine around 3i/2 or 4 years ago. 

Mr. Halley. Have you had no business whatsoever in the last 3i/^ 
or 4 years. 

Mr. Cohen. I made one bet on the world series, which I won, which 
I took a piece of some other person. He made a good-sized bet and 
he liked real good and he is a pretty good handicapper with baseball 
and he advised me to take a piece of his action and I win that bet. I 
win another football bet, which this person is a pretty good handi- 
capper on football, and advised me to take a piece of his action and 
I took a piece of it. 

Mr. Halley. You had a series of transactions with a man named 
O'Rourke in West Palm Beach ? 

Mr. Cohen. That is right. 

Mr. Halley. You won quite a bit of money from him ? 

Mr. Cohen. I didn't. 

Mr. Halley. Were you handling those bets for yourself or for 
others ? 

Mr. Cohen. Some for myself and some for others. 

Mr. Halley. How much for yourself and how much for others? 

Mr. Cohen. I have no way of answering it. It is on the record. It 
is in the record the whole amounts that I reported. 

Mr. Halley. Who were your customers whose bets you were for- 
warding on ? 

Mr. Cohen. They were not my customers. You couldn't call them 
customers. Sav, if a man had a verv good tip on a horse and he 
wanted to move $10,000 or $5,000 or $3,500 or whatever the amount 
happened to be, I had outs to move this money so he would give me a 
slice of the bet if I would move it, if I would get him on. There 
was a time then, and I understand right now it is pretty hard to 
get on for a prettv substantial amount of money. 

Mr. Halley. O'Rourke has talked about some $100, $200. $300, 
and $500 dailv series of bets and after about 6 months you were $50,000 
or $00,000 ahead of him. 



ORGANIZED CRIAIE IN INTERSTATE COMMERCE 253 

Mr. Cohen. I wasn't the winner. 

Mr. Halley, Who were the winners? 

Mr. Cohen. Neddie Herbert would take a slice of it. 

Mr. Halley. Can you name anybody who is still alive? 

Mr. Cohen. I don't know ; 20 different people used to come in and 
out to take a piece of action. 

Mr. Halley. Your mode of earning a living is very mysterious. 
Let's go back to last year. You have listed $10,000 in commissions. 
Will you give the committee some detail about that? 

Mr. Cohen. I told you on some bets that I won. 

Mr. Halley. Who did you win them from ? 

Mr. Cohen. Who did I win the particular bets from? 

Mr. Halley. Yes. 

Mr. Cohen. I won a few bets from a fellow by the name of Harry 
Burns. 

Mr. Halley. Who is he and where does he live ? 

Mr. Cohen. He lives in Ohio. 

Mr. Halley. Where in Ohio? 

Mr. Cohen. I don't know his exact address offhand. I have got it 
home. 

Mr. Halley. Where was he when you made the bets with him? 

Mr. Cohen. It is hard to say. I just won a bet with him in Houston, 
Tex., on a football game 3 or 4 weeks ago. 

Mr. Halley. How much was that? 

Mr. Cohen. Three thousand five hundred dollars. 

Mr. Halley. Has he paid you yet? 

Mr. Cohen. Yes : he sent me the money. 

Mr. Halley. When did he send it to you? 

Mr. Cohen. About 3 or 4 weeks ago. I called it in to Mr. Sackman. 
It came through Western Union. 

Mr. Halley. Have you won any other money in recent weeks ? 

Mr. Cohen. Oh, yes, $500 ; $500 just 2 weeks ago. We won on a bet, 
on two teams ; I don't remember the two teams. 

Mr. Halley. Any other winnings recently? 

Mr. Cohen. No. 

Mr. Halley. Any losses? 

Mr. Cohen. No. 

Mr. Halley. I am wondering why you were broke on November 4, 
when you borrowed that money from Eddie Borden? 

Mr. Cohen. Wondering why I was broke? 

INIr. Halley. You had just won $500 and $3,500 shortly before that, 
you said. 

Mr. Cohen. I am trying to catch up with myself. Sometimes I run 
into somebody that I owe some money to and I give them $200 or $300 
or $500. I don't know why I am broke. I have been broke 50 or 100 
times. 

Mr. Halley. You are not trying to catch up with yourself by 
economizing ? 

Mr. Cohen. The best I know how. 

Mr. Halley. You have two bodyguards at your house? 

Mr. Cohen. That is right. 

Mr. Halley. Do j'^ou have any servants ? 

Mr. Cohen. One. 

Mr. Halley. Do you have a gardener? 



254 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. Yes. - - ^ 

Mr. Halley. That makes two; is that right? 

Mr. Cohen. Yes. 

Mr. Halley. Do you have a chauffeur ? 

Mr. Cohen. No. 

Mr. Halley. A cook ? 

Mr. Cohen. No, sir. 

Mr. Halley. How many automobiles do you and your wife own? 

Mr. Cohen. We really don't own any of them. They are really 
both owned by the Hollywood State Bank. 

Mr. Halley. How many do you drive? 

Mr. Cohen. I drive one and she drives one. 

Mr. Halley. What type of automobiles are they? 

Mr. Cohen. Cadillacs. 

Mr. Halley. Then you have this $16,000 armored car ? 

Mr. Cohen. That is right. 

Mr. Halley. Have you traveled a considerable amount in 1950 ? 

Mr. Cohen. Somewhat ; not a considerable amount. 

Mr. Halley. In wiiat States have you been in in 1950 ? 

Mr. Cohen. In 1950? 

Mr. Halley. Yes. ; 

Mr. Cohen. I went from here to Chicago and then to Texas. 

Mr. Halley. Who did you see in Chicago ? 

Mr. Cohen. Jack Kearns. 

Mr. Halley. Who else did you see ? 

Mr. Cohen. My brotner. 

Mr. Halley. Who else ? 

Mr. Cohen. A fellow named Harold Miller. I seen a lot of people. 

Mr. Halley. Did you talk business with anybody in Chicago ? 

Mr. Cohen. No business spoken at all. 

Mr. Halley. Where else did you go on this trip ? 

Mr. Cohen. After I left Chicago ? 

Mr. Halley. Yes. 

Mr. Cohen. Home. 

Mr. Halley. Did you go to Texas? 

Mr. Cohen. I came home ; this was a separate trip to Texas. 

Mr. Halley. Did you make any stops on the way to Texas ? 

Mr. Cohen. Just on the plane to get to where I was going to. 

Mr. Halley. Did you go to St. Louis this year? 

Mr. Cohen. Yes. 

ISIr. Halley. Who did you see there ? 

Mr, Cohen. A fellow by the name of Ben Greenberg. 

Mr. Halley. What was your business with Greenberg ? 

Mr. Cohen. Nothing. He is a fellow who laiows me since I am 
16 or 17 years of age. He is a fight promoter. 

Mr. Halley. Do you have any business with Irving Glasser ? 

Mr. Cohen. Irving Glasser ? 

Mr. Halley. Yes. 

Mr. Cohen. He has wrote a lot of bonds for me. 

Mr. Halley. Have you had any other business with him ? 

Mr. Cohen. None whatsoever. 

Mr. Halley. Have you had any interest in his card games? 

Mr. Cohen. I don't know if he has any. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 255 

Mr. Hallet. Do you know what the Dincara Stock Farm is ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. What is it? 

Mr. Cohen. It was a place that there was some gambling going on 
there. 

Mr. Halley. Did you have a part of that? 

Mr. Cohen. At one time I had a piece of it ; yes. 

Mr. Halley. How long ago ? 

Mr. Cohen. I think around 5 or 6 years ago. 

Mr. Halley. Have you had any gambling places more recently ? 

Mr. Cohen. No. 

Mr. Halley. Didn't you have a couple in Burbank ? 

Mr. Cohen. No, sir 

Mr. Halley. Didn't you have one at 14114 North La Brea in Bur- 
bank? 

Mr. Cohen. That is not Burbank. 

Mr. Halley. What is it? 

Mr. Cohen. Los Angeles City. 

Mr. Halley. Did you have a gambling place there? 

Mr. Cohen. Yes, but that is longer than 4 or 6 years ago. 

Mr. Halley. You had it as recently as 1947, did you not? 

Mr. Cohen. No, sir. 

Mr. Halley. Are you sure of that ? 

Mr. Cohen. I am almost sure it was before then. Whatever it is, 
I did have a place on La Brea at that address you said there. 

]\Ir. Halley. It was a gambling place, was it not ? 

Mr. Cohen. Not exactly a gambling place; it was a place where 
there was some action there at different times. 

Mr. Halley. Why do you say "some action"? There was a crap 
game there, wasn't there ? 

Mr. Cohen. At different times. A gambling place has crap games 
every night. 

Mr. Halley. How often did you have crap games ? 

Mr. Cohen. AVlienever people formed there that wanted to shoot 
craps. 

Mr. Halley. How often did that happen? 

Mr. Cohen. JSIaybe once every couple of weeks. 

Mr. Halley. Or maybe once or twice a week ? 

Mr. Cohen. Sometimes. 

Mr. Halley. Week ends, generally? 

Mr. Cohen. Saturday night there was usually a game ; yes. 

Mr. Halley. How about 806 Mariposa in Burbank? 

Mr. Cohen. I don't know the address. 

Mr. Halley. You don't know that address ? 

Mr. Copien. 806 Mariposa? 

Mr. Halley. In addition to the North La Brea address didn't you 
have another gambling place? 

Mr. Cohen. I had a piece of the Dincara. 

Mr. Halley. You had a piece of the Dincara. Is that the address 
of the Dincara ? 

Mr. Cohen. Well, is that the address of the Dincara? 

Mr. Halley. I don't know ; you tell me. 

Mr. Cohen. I don't know the exact address. 



256 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You had a piece of the Dincara ? 

Mr. Cohen. That is right. 

Mr. Halley. With whom did you liave that? 

Mr. Cohen. There were some people involved with it that I don't 
know. At different times I would have a different piece; a fellow 
by the name of Mooney Einstat, I think. 

Mr. Halley. Did Captain Guasti have a piece of it? 

Mr. Cohen. I don't know him. 

Mr. Halley. You have never seen him ? 

Mr. Cohen. One time he brought me in for interrogation on some 
kind of a beef. 

Mr. Halley. Do you know whether or not Captain Guasti had a 
piece of the Dincara ? 

Mr. Cohen. Captain Guasti? 

Mr. Halley. Yes. 

Mr. Cohen. I don't know any policemen that would have a piece 
of a gambling house that I would know of. 

Senator Tobey. When you would have a piece of these things, 
wdiat evidence of equity did you have? You say that you had a 
piece. Did you get a piece of paper showing a fifth interest or show- 
ing whatever your interest might be ? 

Mr. Cohen. It is not done that way, Senator. 

Senator Tobey. ^Vliat represents your equity in case you died? 

Mr, Cohen. It is not handled that way, Senator. 

Senator Tobey. How is it handled ? 

Mr. Cohen. People in the gambling business, it is just your O. K. ; 
you are just O. K. and they are O. K. ; no papers at all. 

Senator Tobey. What establishes a one-tenth or a one-twentieth in- 
terest in a place? What establishes tliat? 

Mr. Cohen. You may just have a piece of it. 

Senator Tobey. How do you have a piece of it if you have nothing 
to show for it ? 

Mr. Cohen. That is the way they do business in that business. 

Senator Tobey. In this business that you are in, you get an equity 
by putting some money in and you have nothing to show for it but 
that you are some money out? 

Mr. Cohen. That is right, Senator. 

Senator Tobey. The other thing is, when you borrow money you 
give no evidence of the debt at all, and the fellow has no evidence 
of it? 

Mr. Cohen. They say that truth is sometimes stranger than fic- 
tion, Senator. If you talked to anybody in the gambling business 
they would tell you the same thing ; that is the way it is. I have done 
business with people over the telephone that I have never even met. 
I have talked to them 15 or 20 times a day. 

The Chairman. How do you keep your records to pay your income 
tax ? Do you keep records yourself ? 

Mr. Cohen. Some records, until I give it to my accountant, and 
pay everything. 

The Chairman. Then you tear it up, whatever record you might 
have? 

Mr. Cohen. After I give it to my accountant. 

The Chairman. You have it written on a piece of paper, how much 
you won, and it is just your word for it? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 257 

Mr, Cohen. Yes ; if at the end of that month I have won a certain 
amount of money I tell the accountant; if I have lost I tell the 
accountant. 

The Chairman. You don't specify who you do business wdtli or 
who you won it from or what sort of gamblintr transaction it was; 
you just say you won $10,000 or you lost so much! 

Mr. Cohen. Your business transactions sometimes change. You 
may be at an office for 5 or 6 consecutive days, and they will say, "We 
pass your business," or something like that. Then you look for an- 
other out. 

Senator Tobey. When you take a piece, say like the Dincara, what 
would you call a piece ? Do you mean 5 or 10 percent ? 

Mr. Cohen. I think I had, Senator, 10 percent in that. 

Senator Tobey. There was a meeting of the minds, and you had 10 
percent in the Dincara. Now what have you got to show that the 
fellows who promoted the Dincara hadn't sold 1,000 10-percent pieces 
in the placed 

Mr. Cohen. Nothing but the person's word ? 

Senator Tobey. Have you ever found yourself double crossed on a 
deal like that? 

Mr. Cohen. I thought so at different times, but I have never known 
for sure. 

Mr. Halley. What other business have you had in the last 5 years? 

Mr. Cohen. In the last 5 years I have had a haberdashery store, a 
jewelry store, and a tailoring establishment. 

Mr. Halley. Did you have any partners in any of these? 

Mr. Cohen. I have done some gambling in the last 5 years — some 
betting. 

Mr. Halley. Who were your partners in these various enterprises? 

Mr. Cohen. Neddie Herbert was one of my partners. 

Mr. Halley. In what enterprise? 

Mr. Cohen. When we were betting and laying. Sometimes we 
would lay a horse or bet a horse. He had a piece of me; he was a 
partner. 

Mr. Halley. Did you have anj^ partners in your haberdashery? 

Mr. Cohen. No, sir. 

Mr. Halley. Did you have any partners in your retail store, the 
jewelry store? 

Mr. Cohen. Yes. 

Mr. Halley. Who were your partners there ? 

Mr. Cohen. Meltzer and Stompanato. Stompanato took a piece 
of my end. 

Mr. Halley. You had Stompanato and Meltzer both ; is that right? 

Mr. Cohen. Yes. 

Mr. Halley. Is that the Courtley Jewelers ? 

Mr, Cohen. Yes. 

Mr. Halley, Was Glasser a partner in that? 

Mr. Cohen. No. He originally had something to do with it. He 
originally was in on it; but he never put no money up in it or any- 
thing like that. 

Mr. Halley. What other businesses did you have ? 

Mr. Cohen. None other than those I have mentioned; nothing 
that I can recall. 



258 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. HAI.LEY. Did you ever have any part of the Jim Danclj' Meat 
Markets ? 

Mr. Cohen. No, sir. 

Mr. Halley. At no time ? 

Mr. Cohen. That is a rumor that goes around and it is absolutely 
untrue. 

Mr. Halley. Either directly or indirectly ? 

Mr. Cohen. The man with the Jim Dandy Markets, a fellow by 
the name of Charles Schuester, was a partner with me when I man- 
aged some prizefighters. So everybody got the impression that I had 
a piece of his markets, which was untrue. 

Mr. Halley. Wliat other businesses have you had ? 

Mr. Cohen. I can't think of any others. 

Mr. Halley. When were you last in the fight-managing business? 

Mr. Cohen. I don't know. It would be on there, on the record. I 
think it was 5 or 6 years ago. 

Mr. Halley. About 5 or 6 years ago ? 

Mr. Cohen. I think so. 

Mr. Halley. Who did you manage ? 

Mr. Cohen. Willie Joyce. 

Mr. Halley. Anyone else? 

Mr. Cohen. No ; that is about the only one. I was supposed to have 
pieces of other fighters, but it never worked out. He is the only 
one I really managed. I had another fighter in Chicago. 

Mr. Halley. What was his name ? 

Mr. Cohen. A little Filipino fellow named Manriquez, I think was 
his name. 

Mr. Halley. Manriquez? 

Mr. Cohen. Yes. 

Mr. Halley. Did you have a piece of any other fighters? 

Mr. Copien. I had another fighter in Chicago but I can't think of 
his name. I can give you the name. 

Mr. Halley. Did you have any relationship with Blinky Palermo 
in Philadelphia? 

Mr. Cohen. We fought his champion a few times. 

Mr. Halley. You mean Ike Williams? 

Mr. Cohen. That is right. 

Mr. Halley. Didn't j^ou have a piece of Ike Williams ? 

Mr. Cohen. That is another rumor that people talk about, but it 
isn't so. 

Mr. Halley. Didn't you pay Williams' traveling expenses for seT- 
eral fights? 

Mr. Cohen. I did not. 

Mr. Halley. At no time? 

Mr. Cohen. I may have had a connection to get him tickets at certain 
times, but I got the money back. 

Mr. Halley. You never laid out any money for tickets? 

Mr. Cohen. I may have laid out money for tickets but received it 
back from his manager. 

Mr. Halley. You never charged it as a disbursement in your booli s ? 

Mr. Cohen. No, sir. 

Mr. Halley. It is your position you never represented Ike Williams 
at any time ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 259 

Mr. Cohen. I represented him as a friend from one manager to the 
other. 

Mr. Halley. What did you do for Williams as a friend ? 

Mr. Cohen. When he \Yould come out here, his manager may be at 
different fights, and would not get out until 4 or 5 days previous to the 
time that he was to fight, and he would ask me to look out for him. 

Mr. Halley. His manager was who ? 

Mr. Cohen. Blinky Palermo. 

Mr. Halley. Is he a good friend of yours ? 

Mr. Cohen. Yes. 

Mr. Halley. At his request you would substitute for him when Ike 
Williams came here? 

Mr. Cohen. They do that in the fight game ; it is nothing unusual in 
the fight game. 

Mr. Halley. Did you arrange any fights for Ike Williams ? 

Mr. Cohen. I was instrumental in a fight for Ike Williams. 

Mr. Halley. What fight was that? 

^Ir. Cohen. The Bolanos fight. 

Mr. Halley. In what way were you instrumental ? 

Mr. Cohen. Just helping my friend Babe McCoy make the match. 

Mr. Halley. Did you get paid anything for that? 

Mr. Cohen. Not 5 cents; it probably cost me a few dollars. 

Mr. Halley. But you acted as an intermediary ? 

Mr. Cohen. That is right. 

Mr. Halley. Did you act as manager for anyone else? 

Mr. Cohen. There was one other fellow in Chicago, but I can't 
think of his name. I can get you his name, though. 

Mr. Halley. Would you please? 

Mr. Cohen. Yes. Do you want me to get the name ? 

Mr. Halley. Yes. 

Mr. Cohen. All right. 

Mr. Halley. Have vou ever acted in any capacity for the Retail 
Clerks' Union? 

Mr. Cohen, For the union ? 

Mr. Halley. Yes. 

Mr. Cohen. No, sir. 

Mr. Halley. Have you ever received any money from the union? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know any officers of the union ? 

Mr. Cohen. I don't think so. The Retail Clerks' Union? 

Mr. Halley. Yes. 

Mr. Cohen. I possibly may; I don't know. If you can recall a 
name to me I may know someone. 

Mr. Halley. HaA^e you received a payment from that union or 
from any other union ? 

Mr. Cohen. Not a nickel. 

Mr. Halley. At no time? 

Mr. Cohen. At no time. 

Mr. Halley. Going over your activities, it appears that you have 
been able to borrow $300,000 in the last 5 years; is that right? 

Mr. Cohen. Yes. 

Mr. Halley. And that you say you live quite extravagantly ; is that 
rieht ? 



260 ORGANIZED CRIME^ IN INTERSTATE COMMERCE 

Mr. Cohen. That is right; yes. Maybe too extravagantly; that is 
probably right. 

Mr. Haley. And that you have been surrounded by violence? 

Mr. Cohen. That is right. 

Mr. Halley. That six of your close friends have either been killed 
or disappeared? 

Mr. Cohen. Six? I don't know of six that have disappeared. 

Mr. Halley. Neddie Herbert. 

Mr. Cohen. Yes. 

Mr. Halley. Kothman? 

Mr. Cohen. That is right. 

Mr. Halley. Bugsy Siegel? 

Mr. Cohen. That is right. 

Mr. Halley. Frank Niccoli? 

Mr. Cohen. That is right. 

IVIr. Halley. Dave Ogul? 

Mr. Cohen. That is right. 

Mr. Halley. Who is the one that was wounded ? 

Mr. Cohen. Jimmy Rist. 

Mr. Halley. Jimmy Rist? 

Mr. Cohen. Yes. 

Mr. Halley. And you have had five attempts on your life? 

Mr. Cohen. Five, I think, is the correct amount. I think five is 
right; yes. 

Mr. Halley. On various occasions you have settled arguments with 
people by means which resulted in your being brought before the court 
on charges of assault : is that right ? 

Mr. Cohen. I don't understand the question. 

Mr. Halley'. You have been a strong-arm man; you have beaten 
people up ; is that right ? 

Mr. Cohen. Is that what you say or are you asking me the question? 

Mr. Halley. I am asking you. 

Mr. Cohen. I have never been a strong-arm man for nobody. I 
have never bulldozed anybody in my life. 

The Chairman. The question is whether you have beaten people 
up or not. 

Mr. Cohen. I have had fights, but no beating up or strong-arming. 
Senator, can I answer my own questions? I don't have to have him 
answer my questions for me. 

Mr. Halley. You had a fight with Shaman ? 

Mr. Cohen. That is right. 

Mr. Halley. And you had a fight with Brophy? 

Mr. Cohen. That is right. 

Mr. Halley. And your very close friends, at least, beat up Pearson; 
is that right? 

Mr. Cohen. They were acquitted by 12 citizens of this State. Does 
that say to you they still beat them up ? 

Mr. Halley. You can just answer the question, if you will. 

Mr. Cohen. You say they were beaten up. Twelve citizens ac- 
quitted them. 

The Chairman. He asked you if that was true or not. 

Mr. Cohen. I don't like the way he is asking me the questions. He 
is asking me the questions like that is the truth. 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 261 

The Chairman. You are not asked to pass on whether you like the 
way he asks questions or not. You can answer them either one way 
or another. 

Mr. Cohen. With all my respect to you, Senator, I am still a citizen. 
I have never officially been convicted of a felony and I have some 
rights. That man is not asking me questions. He is answering them 
the ^vay he wants. 

The Chairman. He asked you a question and asked you whether it is 
right. 

Mr. Cohen. There are two ways of asking a question and I say this 
man is not asking them right, and I resent it. You ask me the question 
and I will answer it. 

The Chairman. Just a minute; just a minute, please. 

Mr. Cohen. And there isn't one question that I haven't answered 
that isn't 100 percent the truth. 

The Chairman. Please don't argue with counsel. If you don't 
want to answer his questions just say so. You answer them when 
he asks the questions tlie best you know how. Tell us what you 
know, and if you don't know anything about it then so state. 

Mr. Cohen. I say I haven't answered one question here that isn't, 
to my knowledge, 100 percent the truth. This man would like to have 
you believe just one side. 

The Chairman. I have told you to answer the question if you know 
the answer and if you don't know the answer say j^ou don't know. 

Mr. Halley. The question is whether or not your very close friends 
didn't beat up Pearson? 

Mr. Cohen. Is he going to answer those questions for me. Senator ? 

The Chairman. Counsel, instruct him to answer the question or to 
say he doesn't know the answer and let's go ahead. 

Mr. Halley. The question is : didn't your very close friends beat up 
Pearson ? 

Mr. Cohen. I say they didn't beat up Pearson, but that they were 
acquitted. 

^Ir. Hali^ey. I am not asking you if they were acquitted. I am ask- 
ing you if you know. 

Mr. Cohen. I don't know. 

Mr. Halley. That is an answer. Now, you are in fear of your 
life; is that right? 

Mv. Cohen. Somewhat, yes. ' 

Mr. Halley. And you have been surrounded by violence; is that 
right ? 

Mr. Cohen. WTiat do you mean, that I am surrounded by violence ? 
What do you mean, that I am surrounded by violence? I have not 
murdered anybody; all the shooting has been done at me. Wliat do 
you mean. I am surrounded by violence, because people are shooting 
at me, that is the wa}^ it is. What do you want me to do about it? 

The Chairman. Just a minute, Mr. Cohen. Let me put it another 
way. 

Mr. Cohen. People are shooting at me and he is asking me if I 
am surrounded by violence. 

The Chairman. When I am speaking or when couiisel is speaking,, 
please listen until we are finished. 

Mr. Cohen. I am sorry. Senator. 



262 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. The question was whether you were surrounded 
or in an atmosphere of violence ; that is, whether you were surrounded 
by fights and shootings and what not. That is what the question is. 

Answer it if you can and if you can't, so state. 

Mr. Strong. I think the witness' objection is to the conchision, in 
the summarization by counsel for the committee. He has all the 
facts, and now he is just repeating them. If he wants to give con- 
clusions by way of summarizations 

The Chairman. The witness can state whether it is right or not. _ 

Mr. Halley. Mr. Cohen, I asked you and I will ask you once again, 
whether your life has, in the last 5 years been one surrounded by 
violence ? 

Mr. Strong. I would like to object to the question. It has been 
asked three times. I don't see where any useful purpose is being made 
here by having such a statement like that. 

The Chairman. Just a minute, counsel. Mr. Cohen, let me put 
the question another way. During the past 5 years have you from 
time to time been in fear of your life and have you had acts of 
violence carried on around you ? 

Mr. Cohen. Yes, Senator ; that is right, but I haven't done anything 
violent. 

The Chairman. We understand your position. 

Mr. Cohen. The way he puts it I am the one that is violent. 

The Chairman. You will have ample time to make your expla- 
nations. 

Mr. Halley. At least on one occasion you were convicted of an 
act of violence ; were you not ? How about Brophy ? 

Mr. Cohen. It was only a personal fight. Every man has had a 
fist fight, especially when he was a kid. 

Mr. Halley. You don't consider that an act of violence ? 

Mr. Cohen. Positively not. It was a personal grievance between 
Brophy and myself. 

Mr. Halley. Was Brophy convicted ? 

Mr. Cohen. I don't know. 

Mr. Halley. He went to the hospital ? 

Mr. Cohen. That is what I was told. I never took him to the 
hospital. 

Mr. Halley. The grievance was over a matter of money ? 

Mr. Cohen. That is what you say. 

Mr. Halley. That is what you testified to. 

Mr. Cohen. I don't know what the grievance was; I don't re- 
member it. 

Mr. Halley. You testified to it a while ago. 

Mr. Cohen. I couldn't truthfully tell you what the argument was 
about. 

Mr. Halley. You testified some time back that the argument was 
because he wouldn't give you wire service. 

Mr. Cohen. Is that money ? 

Mr. Halley. Wire service is worth money to a bookmaker. 

Mr. Cohen. You just got through saying money. 

Mr. Halley. I said a matter of money. 

Mr. Cohen. You said money. In other words, you are trying to 
give the impression that we had an argument. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 263 

Mr. Hallet. There is no point in your trying to weasel, weaseling 
out of the answer. 

Mr. Cohen. I object to the way the man is questioning me. 

The Chairman. Mr. Cohen, will you be still a moment? He is 
asking you whether that matter was in connection with money or 
business, whether it grew out of some business transaction, and you 
have already testified about it. 

Mr. Cohen. Let me ask you this, Senator : How come it is easy for 
you to put the question in the right way and when he puts it he puts 
it how he wants to ? 

The Chairman. We are doing all right, if you will just answer the 
questions, Mr. Cohen. 

Mr. Halley. You have had associations in other cities with various 
people, have you not, during your travels ? 

Mr. Cohen. You mean do I have friends throughout the country ? 

Mr. Haixet. Yes. 

Mr. Cohen. Numerous friends. 

Mr. Halley. In New York, for instance, do you count Joe Adonis 
among your friends ? 

Mr. Cohen. I don't know the man and have never seen him in my 
life. 

Mr. Halley. You have never met him ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Frank Costello ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Meyer Lansky ? 

Mr. Cohen. No. 

Mr. Halley. Have you ever met him ? 

Mr. Cohen. No. 

Mr. Halley. Have you ever met Jack Lansky ? 

Mr. Cohen. I did not. 

Mr. Halley. Have you ever met Phil Kastel ? 

Mr. Cohen. Never. 

Mr. Halley. Never in your life? 

Mr. CopiEN. No. 

Mr. Halley. Have you ever met Charley Fischetti ? 

Mr. Cohen. Cliarley Fischetti, I don't know; I possibly have met 
him. 

Mr. Halley. Have you ever had any business relations with him ? 

Mr. Cohen. Nothing whatsoever. There are a few Fischettis and 
I don't know which one is Charley. 

Mr. Halley. Do you know Rocco Fischetti ? 

Mr. Cohen. I just got through telling you I don't know which is 
which. 

Mr. Halley. But you know one of the Fischettis ? 

Mr. Cohen. I was living in Chicago but I never really met them. 

Mr. Hali.ey. Did you know Paul Ricca ? 

Mr. Cohen. No. 

Mr. Halley. Do you know "Little New York" Campagna ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Ralph Capone ? 

Mr. Cohen. No. 



264 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Do you know Irving Sherman ? 

Mr. Cohen. IrAdng Sherman ? 

]\Ir. Halley. Yes. 

Mr. Cohen. The name sounds familiar. I don't know if I know 
him or not. 

Mr. Halley. Do you know Murray Humphreys ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Tom Kelly ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Lester Cruz ? 

Mr. Cohen. No, sir. 

Mr. Halley. Did you know Moe Annenberg ? 

Mr. Cohen. No. 

Mv. Halley. Do you know James Eagen ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Frank Nitti ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Phil D' Andrea ? 

Mr. Cohen. No. 

Mv. Halley. Do you know John Rosselli ? 

Mr. Cohen. Yes, sir. 

]Mr. Halley. Plave you had business dealings with him ? 

JSIr. Cohen. None whatsoever. 

]\Tr. Halley. Do you know Fred Evans ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Frank Milano ? 

Mr. Cohen. Frank Milano I met on one occasion. 

Mr. Halley. Do you know his brother, Anthony Milano ? 

Mr. Cohen. Very well. 

Mr. Halley. Plave you had business dealings with him ? 

Mr. Cohen. No — yes, let me see if I can say "business." You 
couldn't really say it was even business. 

Mr. Halley. Have you ever been in business with Milano, in any 
kind of a business? 

Mr. Cohen. No. 

Mr. Halley. What was it that you were referring to ? 

Mr. Cohen. I borrowed some money from liim for a business at one 
time. I told him if I would do any good I would try to help him. 
He said, "I want no part of it." 

Mr. Halley. Was it for a gambling business ? 

Mr. Cohen. For a business that I went into in Las Vegas, Nev. 

Mr. Halley. What business was that ? 

Mr. Cohen. A gambling casino. 

Mr. Halley. In Las Vegas ? 

Mr. Cohen. Yes, the Monte Carlo. 

Mv. Halley. The Monte Carlo ? 

Mr. Cohen. That is right. 

Mr. Halley. Do you know "Big Al" Polizzi ? 

Mr. Cohen. I met him ; just a nodding acquaintance. 

Mr. Halley. Do you know Dominic Farensheni ? 

Mr. Cohen. Very well. 

Mr. Halley. He is a close associate of yours ? 

Mr. Cohen. Very close. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 265 

Mr. Halley. Was he just recently convicted under tlie Federal 
law for the possession of a niacliine gun ? 

Mr. Cohen. Yes, he was. 

Mr. Halley. Have you had any business relations with Faren- 
sheni ? 

Mr. CoiiEN". No business at all. I have helped him out. I loaned 
him money at different times. 

jNIr. Halley. Does he work for you ? 

Mr. Cohen. No, he does not work for me. He is not able to do 
anj^ work. He is a sick man and can't see. 

Mr. Halley. Did he ever work for you ? 

Mr. Cohen. No, sir. 

Mr. Halley. Does he live with you ? 

Mr. Cohen. No, sir. 

Mr. Halley. But he associates with you a considerable amount? 

Mr. Cohen. He is a very good friend. 

Senator Tobey. How could he use a machine gun if he didn't see ? 

Mr. Cohen. He never used it. 

Senator Tobey. What was it for ? 

Mr. Cohen. I couldn't answer that. He wasn't convicted of using 
it. 

Senator Tobey. He was convicted of possession ? 

Mr. Cohen. It will take a long time to explain it. 

Senator Tobey. Don't bother. 

Mr. Cohen. There is no question about him not being able to see. 
He can't see in front of him, really. In fact, he is led most of the 
time. 

Mr. Halley. Do you know Jimmy Utley ? 

Mr. Cohen. Do I know him ? 

Mr. Halley. Yes. 

Mr. Cohen. Yes, sir. 

Mr. Halley. Have you had any business dealings with him? 

Mr. Cohen. No, sir. 

]Mr. Halley. I am sorry, I didn't get your answer. 

Mr. Cohen. No, sir. 

Mr. Halley. You had no business dealings with him ? 

Mr. Cohen. No, sir. 

Mr. Halley. At any time? 

Mr. Cohen. Outside of him buying some stuff in my store. 

Mr. Halley. You never placed bets with him ? 

Mr. Cohen. None whatsoever. 

Mr. Halley. Never invested in business with him ? 

Mr. Cohen. No, none whatsoever. 

Mr. Halley. Do you know Jack Licavoli ? 

Mr. Cohen. No, sir. 

Mr. Halley. Pete Licavoli ? 

Mr. Cohen. Pete, yes. 

Mr. Halley. How long have you known him ? 

Mr. Cohen. Not very long. In fact, I have only met him one time. 

Mr. Halley. Have you ever had au}^ business with him ? 

Mr. Cohen. None whatsoever. 

The Chairman. You were asked if you had any business dealing? 
Avith Jimmy Utley ? 

Mr. Cohen. Yes, sir. 

68958— 51— pt. 10 18 



266 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chaikman. Does he operate in Gardena ? 

Mr. Cohen. Mr. Utley and I have never been in close association, 
Senator, and I know nothing about his business. 

The Chairman. You never bought a part of an interest in a busi- 
ness he had ? 

Mr. Cohen. No, sir. 

Mr. Hallet. Do you know the King boys, George or John King 
from Cleveland ? 

Mr. Cohen. I know George, and Johnny King I know just by sight. 

Mr. Hallet. How long have you known George ? 

Mr. Cohen. George knows me from when I was a fighter. We were 
never friendly. He knew me when I was a kid around there. Johnny, 
I only know by sight ; maybe I wouldn't remember him now. 

Mr. Halley. Do you know Morris Klineman ? 

Mr. Cohen. No, sir. I know the name but that it all. 

Mr, Halley. Do you know Lou Rothkopf ? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Have you ever had business with him ? 

Mr. Cohen, No business whatsoever. 

Mr. Halley. Has he ever visited you at your home ? 

Mr. Cohen. Very often. 

Mr. Halley. You are good friends ? 

Mr. Cohen. Very good friends. 

Mr. Halley. He is also from Cleveland? 

Mr. Cohen. Yes, sir. 

Mr. Halley. He is a gambler? He is in the gambling business, 
isn't he? 

Mr. Cohen. I wouldn't consider him in the gambling business, not 
today, anyway. He may have been a gambler. I don't think he would 
be a gambler today. I am positive that he is not a gambler today. 

Mr. Halley. Doesn't he own a piece of the Flamingo ? 

Mr. Cohen. If I had to bet I would be he doesn't. 

Mr. Halley. Was he never in the gambling business, to your knowl- 
edge? 

Mr. Cohen. Yes ; he was, but I would have to bet he is not in the 
gambling business today. 

Mr. Halley. Do you know that of your own knowledge or are you 
stating your best opinion ? 

Mr. Cohen. I am almost positive, that is all I can say. That is a 
truthful answer. 

Mr. Hallet. Do you know Moe Dalitz ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Joe De Carlo ? 

Mr. Cohen. I know Joe. I would just call it a nodding acquaint- 
ance. 

Mr. Halley. In Kansas City, do you know Tony Gizzo ? 

Mr. Cohen. No. 

Mr. Halley. Snags Klein? 

Mr. Cohen. Yes, sir. 

Mr. Halley. Have you ever had any business with Snags ? 

Mr. Cohen. You couldn't say it was directly with Snags. His 
brother, his brotlier and sister bought a restaurant from me. I would 
sa}'' no direct business with Snags at all. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 267 

Mr. Halley, Wliat restaurant did they buy ? 

Mr. Cohen. The LaBrea CKib. 

Mr. Halley. At that time it was no longer a gambling place ; is that 
correct ? 

Mr. CoHEisr. It was half gambling and half restaurant all the time. 
When they bought it they made a barbecue house out of it. 

Mr. Halley. Do you know Charles Binaggio? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Charles Gargotta ? 

Mr. Cohen. No. 

Mr. Halley. Do you know Longie Zwillman ? 

Mr. Cohen. No, sir. 

Mr. Halley. Do you know Willie Moretti ? 

Mr. Cohen. No, sir. 

Mr. Halley. Have you any business dealings at Medicine Park, 
Okla.? 

Mr. Cohen. Any business dealings, no. I just have a friend that 
was up there, but he is not there any more. 

Mr. Halley. Have you any business dealings today in Cleveland? 

Mr. Cohen. None whatsoever. 

Mr. Halley. In Chicago ? 

Mr. Cohen. No, sir. 

Mr. HalIxEY. In Phoenix ? 

Mr. Cohen. No, sir. 

Mr. Halley. In St. Louis? 

Mr. Cohen. No, sir. 

Mr. Halley. In Las Vegas ? 

Mr. Cohen. No, sir. 

Mr. Halley. In New York City ? 

Mr. Cohen. No, sir. 

Mr. Halley. In Houston, Tex. ? 

Mr. Cohen. No, sir. 

Mr. Halley. In Tulsa ? 

Mr. Cohen. No, sir. 

Mr. Halley. In Reno, Nev. ? 

Mr. Cohen. No, sir. 

Mr. Halley. You have made phone calls and received phone calls 
in recent months from all of those places, have you not ? 

Mr. Cohen. From all of those places ? 

Mr. Halley. Yes. 

Mr. Cohen. No, sir ; from most of them but not all of them, I don't 
think. 

Mr. Halley. Which would you say you hadn't ? 

Mr. Cohen. I can't remember them all. I didn't receive any from 
Tulsa. 

Mr. Halley. In July did you not receive a call from Tulsa? 

Mr. Cohen. I don't think so, Mr. Halley. 

Mr. Halley. Would that be the only city that is wrong on this 
list? 

Mr. Cohen. I don't know, but I don't think it was for all of them. 

Mr. Halley. How about Cleveland ? 

Mr. Cohen. Yes, I have talked back and forth with Cleveland. 

Mr. Halley. How about Reno ? 



268 ORGANIZED CRIME IN INTERSTATE COMMERCE 

]Mr. CoHjEN. I don't think I spoke to Eeno in the last 3 or 4 or 5 
months or maybe longer than that. 

Mr. Halley. Didn't you talk to somebody at the Riverside Hotel ? 

Mr. Cohen. I have spoken to Reno but 1 haven't in the length of 
time you say. 

Mr. Halley. How about in July ? 

Mr. Cohen. I don't think so. 

Mr. Halley. Laura Pakin at the Riverside Hotel ? 

Mr. Cohen. I don't know any Laura Pakin. 

Mr. Halley. Do other people use your telephone ? 

Mr. Cohen. Yes. 

Mr. Halley. Besides you ? 

Mr. Cohen. Sure. 

]\Ir. Halley. Who might have used your telephone ? 

Mr. Cohen. I coiddn't answer that ; I don't know that name — ■ — 
Laura Pakin. 

Mr. Halley. Have you ever talked to Boston ? 

Mr. Cohen. I speak to Boston maybe two or three times out of the 
week. 

Senator Wiley. Two or three times what ? 

Mr. Cohen. Out of the week. 

Senator Tobey. To whom do you speak with in Boston ? 

Mr. Cohen. Paladino. 

Senator Tobey. What is his business ? 

Mr. Cohen. He owns a night club and he sent me a little fellow to 
look after that is a singer, that is trying to be a singer. 

JNIr. Halley. I think you said he gives you bets too. 

Mr. Cohen. Not in the last 3 years or S^j, or 4 years. 

Mr. Halley. Who does give you the bets on which you make these 
commissions? We started that once before and we haven't been able 
to find out. 

Mr. Cohen. Who does give them to me? 

Mr. Halley. Yes. 

Mr. Cohen. Who did give them to me, you mean ? 

Mr. Halley. How about 1949 ? You "have listed $10,000 as com- 
missions. 

Mr. Cohen. I put it down as commissions ; it was bets that I won. 

Mr. Halley. It really should be your earnings ? 

Mr. Cohen. I put it down as earnings. 

]V[r. Halley. On your own bets^ 

Mr. Cohen. If somebody made a $5,000 bet, he ma}' have given me 
$1,000 on it. It all amounted to $10,000 at the end of the year. 

Mr. Halley. Why do people give you a commission on a bet they 
juake^ 

Mr. Cohen. Lots of people call me and like to see me win a bet. 

Mr. Halley. Are they the same people that like to lend you money ^ 

]\Ir. Cohen. A lot of them, yes. 

Mr. Halley. Do you have any other explanation than that your 
credit is good for the reason that people have, in the last 5 years, 
been able to and Avilling to loan you $300,000? 

Mr. Cohen. The Internal Revenue Department has been to every 
one of these people. They can find out. I haven't hid it. These peo- 
])1e haven't denied it. There is not one person that has loaned me 



ORGANIZED CRIME IN INTERSTATE COMMERCE 269 

money tliat would deny it. You don't think a bank president would 
put himself in the middle to say he didn't, 

Mr. Halley. I think you said Anthony Milano is a bank president. 

Mr. Cohen. I am not speaking of him. 

Mr. Halley. He is one bank president, isn't he ? 

Mr. Cohen. He has a very small bank. 

Mr. Halley. He is a bank president, isn't he? 

Mr, Cohen. Yes. 

Mr. Halley. He spent 6 years in the Federal penitentiary for coun- 
terfeiting, didn't he? 

]\lr. Cohen. Do you want me to tell about Anthony Milano so every- 
body can hear about it ? 

Mr. Halley. I want to talk about bank presidents being honorable 
men. 

Mr. Cohen. Why, what did Mr. Brown do? 

The Chairman. Do you know whether Anthony Milano is presi- 
dent of a bank in Cleveland that you do business with ? 

Mr. Cohen. No. 

The Chairman. Did you say you did business with him ? 

Mr. Cohen. No. The man "has loaned me some money. 

The Chairman. He loaned you money? 

Mr. Cohen. Personally, yes. 

Mr. Halley. That is what Brown di d, too ? 

Mr. Cohen. Yes. 

The Chairman. Do you know whether he served time for counter- 
feiting, xlnthony Milano ? 

Mr. Cohen. This man is a man of 60 years of age. I wouldn't have 
enough nerve to say to him, "Mr. Milano, have you been in the peni- 
tentiary for counterfeiting?" 

The Chairman. Do you know or don't you know ? 

Mr. Cohen. I don't know. 

Senator Wiley. Do you intend to pay all these obligations back? 

Mr. Cohen, Very much so. 

Senator Wiley. How are you going to pay them ? 

Mr. Cohen. I am trying to get into business. 

Senator Wiley. What business ? 

Mr. Cohen. Some of these people are willing to back me further 
in a business in Texas if I would be able to go down there and get into 
some oil business that somebody has brought to my attention, but 
the L. A. P. D. didn't see fit for me to go down to Texas to go into the 
business. They sent wires that a notorious character was coming 
down there, and I couldn't go through with my business. How can 
I go into a business under conditions like that? 

The Chairman. And Mr. Gonzales ran you out of Texas ^ 

Mr. Cohen. Yes, sir. 

The Chairman. What town in Texas was that ? 

Mr. Cohen. Fort Worth. 

The Chairman. It seems to me that I remember reading in the 
newspapers that you said you didn't get a very warm reception in 
( /hicago and you got run out of Texas, but that you were wined and 
dined in St. Louis. Did you make a statement like that ? 

Mr. Cohen. Xo, sir: I never made a statement like that at all, 
Senator. 



270 ORGANIZED CRIME. IN INTERSTATE COMMERCE 

The Chairman. You got along better in St. Louis than you did in 
Texas and Chicago ? 

Mr. Cohen. I didn't get run out of St. Louis, if that is what you 
mean. 

The Chairman. Do you deny that you said you had been wined 
and dined by officials in St. Louis? 

Mr. Cohen. I deny it, Senator. 

The Chairman. Who are your friends in St. Louis ? 

Mr. Cohen. Who are my friends ? 

The Chairman. Whom did you see there and whom do you do busi- 
ness with there ? 

Mr. Cohen. A man by the name of Ben Greenberg. 

The Chairman. He is a fight promoter? 

Mr. Cohen. That is right. He owns a saloon and is a fight pro- 
moter. 

The Chairman. I have a recollection that he has been charged with 
fixing fights. Do you know whether that is true or not ? 

Mr. Cohen. I clon't think so. 

The Chairman. You think it is not true ? 

Mr. Cohen. I don't think it is true. 

The Chairman. Did you ever fix a fight ? 

Mr. Cohen. Never in my life. 

The CHAIR3IAN. This fellow, Johnny O'Rourke, in West Palm 
Beach, complains bitterly about the kind of bets you sent him. You 
would call him up out of the blue and place several bets with him 
over a period of 5 or 6 months, and over that period you won about 
$60,000 or $70,000 from him. He never could win but one or two bets 
from you. 

Mr. Cohen. He is probably telling you the truth. 

The Chairman. How does that happen ? Did j^ou have horses that 
you knew about ? Did you have tips ? 

Mr. Cohen. Horses? 

The Chairman. Did you have any races fixed ? 

Mr. Cohen. Nothing fixed. 

The Chairman. Did you have any jockeys that kind of knew how 
they were going to run their horses ? 

Mr. Cohen. No, they just knew the horses were ready. 

The Chairman. It is rather unusual, just with the odds on the 
regular tote board, that he would lose $70,000, and I think he never 
won but about $1,000 from you. 

Mr. Cohen. I think he exaggerated a little bit. 

The Chairman. That is what he stated, and he has his records. 

Mr, Cohen. I think he exaggerated a little bit. He wins some pretty 
fair bets himself. 

The Chairman. But not from you? 

Mr. Cohen. The bets I won were not all mine either, and the bets he 
wins I don't know if they were all his. 

The Chairman. In the transactions back and forth, he lost about 
$70,000 and won only about $1,000 from you. 

Mr. Cohen. I am positive he won some bigger bets from me than 
that. I will say this, that every time I made a bet I tried to win it. I 
didn't make any bets trying to lose. 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 271 

Senator Wiley. What percentage of that $70,000 was your own 
personal gain? 

Mr. Cohen. Maybe about $15,000 of it ; $15,000 or $18,000 or $20,- 
000. 

Senator Wiley. Over what period ? 

JNIr. Cohen. Over quite a period of time. 

Senator Wiley. You mean over several years? 

Mr. Cohen. A few years ; yes, sir. 

Senator Wiley. Have you any books or records showing any win- 
nings and losings, showing your winnings and your losses, if this 
particular amount you speak of, $70,000, was from one source ? You 
had other sources where you bet also, other places, I take it? Now, 
have you got any records that designate or indicate what your total 
winnings or losses were over a given period, over this year, that year, 
and so forth? 

Mr. Cohen. Onlr the records that I reported to my accountant. 

Senator Wiley. Do you have any books on that? 

Mr. Cohen. I don't know how you mean. I haven't had any edu- 
cation and don't know how to keep books. 

Senator Wiley. I am just speaking of simple bookkeeping. 

Mr. Cohen. I would keep it for a day and turn it in to my account- 
ant and that would be all. I don't know how to keep no books. I am 
bad on those things anywaj^ 

Senator Wiley. Has the Federal Government ever assessed you a 
blank assessment? 

Mr. Cohen. I don't know what you mean. Senator. 

Senator Wiley. Well, they make the farmers up in my State keep 
books. 

Mr. Cohen. My accountant takes care of all of that. Senator. 

The Chairman. I have one more question before you proceed, Mr. 
Halley. 

You said a little while ago you had no business with Snags Klein 
of Kansas City. 

Mr. Cohen. I wouldn't say business with him directly. I sold a 
restaurant to his brother and his sister, I believe. 

The Chairman. Snags Klein testified, in Kansas City, and he is 
serving time in Leavenworth now, that about 3 years ago, I believe 
it was, you called him up on the telephone, right out of the blue, and 
tried to borrow $3,000 from him, I think it was. 

Mr. Cohen. It wasn't right out of the blue. Snags Klein was here 
and spent some time with me here. I did need some money. I think 
it was about 2i/2 years ago. I called him and asked him if he could 
loan me some money. 

The Chairman. You said you never tried to do any business with 
him or never have done any business with him. You did call him 
up and try to borrow $3,000 1 

Mr. Cohen. That is true ; yes. 

JNIr. Halley. Do you know someone by the name of Stompanato? 

Mr. Cohen. Sure. 

Mr. Halley. That is John Stompanato ? 

Mr. Cohen. Yes. 

Mr. Halley. Is he a good friend of yours ? 



272 ORGANIZED CRIME^ IN INTERSTATE COMMERCE 

Mr. Cohen. He is a young fellow, a nice fellow ; he is a good boy. 

Mr. Halley. How old is he ? 

Mr. Cohen. His true age is 25 years old. 

Mr. Halley. In the last 2 years, 2 years ago, did you borrow some 
money from him? 

Mr. Cohen. Yes. 

Mr. Halley. Several thousand dollars? 

Mr. Cohen. Yes. 

Mr. Halley. About $7,500; is that right? 

Mr. Cohen. He put $7,500 in the jewelry store business and then 
I had some different money transactions with him. They were all 
called in to the accountant. 

Mr. Halley. They added up in 1948 to $14,000, didn't they; $13,000 
or $14,000 ? 

Mr. Cohen. I have borrowed from him at different times and he has 
borrowed from me at different times. 

Mr. Halley. He has stated in an examination that in the year 1948 
he had loaned you approximately $13,000 or $14,000. 

Mr. Cohen. If he said it, it is the truth. He wouldn't say nothing 
that wouldn't be the truth. 

Mr. Strong. May I ask if those questions that you are now asking 
come from an Internal Revenue Department investigation i 

Mr. Halley. This is a document that was subpenaed from Mr. 
Cohen's auditor. 

Did he have any job at that time? 

Mr. Cohen. He worked at the Continental Cafe for a time. 

INIr. Halley. What did he do at the Continental Cafe? 

Mr. Cohen. He was the manager, the bartender; everything. 

Mr. Halley. Did he earn large sums of money? Was he a man 
of wealth ? 

Mr. Cohen. I don't know that. I know he was able to get some 
money some place ; that is what he told me at the time. 

Mr. Halley. He borrowed very large sums of money from a rich 
man; did he not? 

Mr. Cohen. That is right; yes. 

Mr. Halley. Isn't it a fact that tlie Government is now charging 
that he got that money by extortion ? 

Mr. Cohen. I don't think so ; I think it is not a fact. 

Mr. Halley. Perhaps I better read you the fact. This is a state- 
ment by the revenue agent Avho made an examination of Mr. 
Stompanato. 

Mr. Strong. Then it is a revenue agent's form ? 

Mr. Halley. I said it was a form we subpenaed from your 
accountant. 

It is stated in here : 

The Government intends to try to make a showing Mr. Stompanato, that Mr. 
Blank is a very wealthy man without too much business experience. That in 
1948 and 1949 he was blackmailed by various persons for amounts in excess 
of $65,000. 

Mr. Cohen. That is a very fmmy question. He just had dinner 
with the fellow 3 nights ago. I don't think he would have had dinner 
with the fellow 3 nights ago if he blackmailed him. It don't seem 
possible. On what grounds would Stompanato blackmail anybody? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 273 

Mr. Halley. I am trying to find out how you and Stompanato suc- 
ceeded in persuadinfT people to loan you large sums of money. 

Mr. Cohen. I can only answer for myself. If you want Stompanato 
you can ask him. 

Mr. Halley. Now, you have answered that question because you say 
your credit is so good. 

Mr. Cohen. Yes. I don't know of any other money that Stom- 
panato was able to get. 

Mr. Halley, This seems to be a pretty good source. 

Mr. Cohen. Maybe the fellow wanted to give him the money. They 
had dinner 3 nights ago. 

Mr. Halley. Well, you don't know either way about that? 

Mr. Cohen. No. 

Mr. Halley. Is there any connection — this is a question and not a 
charge — is there any connection between the violence associated with 
the people who have been close to you and your ability to obtain large 
sums of money from various people in the form of loans ? 

Mr. Cohen. Absolutely not. 

Mr. Halley. Are these loans legitimate loans or are they cover-ups 
for income obtained by you in other ways ? 

Mr. Cohen. 1,000 percent legitimate loans. 

Mr. Strong. If you don't call that an income-tax question, I don't 
know what it is. 

Mr. Halley. Are you objecting to it? 

Mr. Strong. We have a general objection as to the immunity statute 
here. 

Mr. Halley. Is there any evidence of any of these debts in the form 
of promissory notes ? 

Mr. Cohen. I told you "No." You asked me that question four 
times. 

Mr. Halley. I just wanted to make sure on a few of these questions. 

Mr. Cohen. I haven't changed my answer on one question. 

Mr. Halley. Well, the record will show what it shows. 

Mr. Cohen. You have changed your way of putting the question. 

The Chairman. Just answer the question. 

Mr. Halley. Did you give collateral on any of these loans ? 

Mr. Cohen. No, sir ; I gave a note in two or three different instances. 

Mr. Halley. I have no other questions, sir. 

The Chairman. I have one or two questions I want to ask. You 
liad Charley Binaggio's name in your book at home with his number? 

Mr. Cohen. Yes. 

The Chairman. Why would you have his name and number ? 

Mr. Cohen. Let me see how I can recall how that came about. There 
were some people in the othce that were calling Kansas City for foot- 
ball information, which they were dealing back and forth on football 
information, bets on football. This particular book that you are 
calling, or liilking about. Senator, there was maybe 20 different people 
that have aiicess to this book. All these persons put in their different 
numbers that were needed for these different things. I have never 
spoken to Charley Binaggio personall}^ or ever seen him. 

The CiJAtKMAN. Here is the name "Tony DeLanter." Under that 
you hav(! ".Dope." What does that mean? 

Mr. Coji. [N. That is his name, "Dope." 



274 ORGANIZED CRIME. IN INTERSTATE COMMERCE 

The Chairman. Is that his nickname ? 

Mr. Cohen. That is right. 

The Chairman. You kept Snags Klein's number ? 

Mr. Cohen. That is right. 

The Chairman. You have numbers here of people all over the 
United States. You have people from all over the United States 
with their names and telephone numbers ? 

Mr. Cohen. Yes, sir. 

The Chairman. What did you keep these for ? 

Mr. Cohen. They may be friends of mine. I don't know what num- 
bers you are talking about. 

The Chairman. Look these over very briefly. 

Mr. Cohen. Joe E. Lewis ; he is an entertainer. 

The Chairman. I am not asking you about all of them. These 
are numbers that you kept and called from time to time? 

Mr. Cohen. Yes; here is Eddie Cantor's name. These are all 
friends of mine. Here is a fellow I done business with — John 
O'Kourke. 

The Chairman. I imagine that Mr. O'Eourke is sorry you got his 
number. 

Mr. Cohen. I imagine so, too. 

The Chairman. I would like you to state whether those were from 
the book you kept, as to the names and numbers, and if those are 
correct. Just look through them as a sample. Let me have them 
back, if you will. These were the out-of-town numbers ; is that right ? 
We also had a bunch of in-State numbers. 

Mr. ToBEY. Were you ever known as Bob O'Brien? 

Mr. Cohen. No, sir. 

Senator Tobey. Do you know a man in this town by the name of 
Arthur Samish? 

Mr. Cohen. I know him ; yes. 

Senator Tobey. How well do you know him ? 

Mr. Cohen. I wouldn't say real well. 

Senator Tobey. When did you see him last ? 

Mr. Cohen. I don't think I have seen Mr. Samish for 2 years, I 
imagine. 

Senator Tobey. That is the night when gunfire took place in front 
of Sherry's Restaurant? It was sometime in July of 1949; wasn't it? 

Mr. Cohen. Yes ; I think so. 

Senator Tobey. Weren't you and Samish together an hour or two 
before you and your associates were shot down? 

Mr. Cohen. He was in a restaurant that I walked into. 

Senator Tobey. Were you with him ? 

Mr. Cohen. I just saw him. 

Senator Tobey. You said you hadn't seen him for 2 or 3 years? 
_ Mr. Cohen. A year and a half or 2 years. I don't know the exact 
time. 

Senator Tobey. The record indicates that your telephone calls show 
as many as 14 telephone calls between your respective headquarters in 
a period of a few months. You had 14 telephone calls with Samish 
between your office and his within a few months. 

Mr. Cohen. That don't mean they necessarily came from me. 

Senator Tobey. Wliat is Samish's business ? 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 275 

Mr. Cohen. I don't know ; he is in the liquor business. 

Senator Tobey. Is he a so-called big shot? 

Mr. Cohen. I don't know what you would call a big shot. He is 
a fine man. 

Senator Tobey. He is a man of prominence in this city? Is he a 
man that meddles in politics a good deal ? 

Mr. Cohen. I don't think so. 

Senator Tobey. Doesn't he make or break men in public life ? 

Mr. Cohen. I wouldn't say that. 

Senator Tobey. Isn't he a strong-arm man in the political world 
here in California ? 

Mr. Cohen. I don't think so. 

Senator Tobey. Now, we are talking here man to man. Forget the 
•crowd being here. What do you know about Samish ? 

Mr. Cohen. I know he is a very fine gentleman. 

Senator Tobey. Fine in what way ? 

Mr. Cohen. Fine in every way ; very charitable. 

Senator Tobey. What is his business? 

Mr. Cohen. I think he is in the liquor business. 

Senator Tobey. Hard liquor or wineries ? 

Mr. Cohen. I think he is a representative for the liquor business. 

Senator Tobey, That is all he does ? 

Mr. Cohen. That is all I know. 

Senator Tobey. Where is his office? 

Mr. Cohen. In San Francisco. 

Senator Tobey. Where else? 

Mr. Cohen. I don't know. 

Senator Tobey. How about in this city here ? 

Mr. Cohen. I don't know. 

Senator Tobey. Doesn't he maintain a suite on the second floor of 
the Biltmore Hotel? 

Mr. Cohen. I have never been up there. 

Senator Tobey. You do not know that ? 

Mr. Cohen. I don't know it ; no. 

Senator Tobey. You never heard that before ? 

Mr. Cohen. No ; not that it was his office or offices. 

Senator Tobey. How does he get his great influence in politics in 
this State ? 

Mr. Cohen, I don't know. 

Senator Tobey. Did you know that the Governor of this State 
stated that, "In matters that concern him he has more influence than 
I have." Did you read the articles in Collier's magazine ? 

Mr. Cohen. I read about Samish ; yes. 

Senator Tobey. You read the articles ? 

Mr. Cohen. Yes. 

Senator Tobey. You saw the stories, read the stories, which told 
about Samish being pretty weird and uncanny ; the great power that 
this man yields in politics in the State of California? 

Mr. Cohen. I have learned through my own experience that I 
wouldn't believe one word in Collier's or any other magazine or news- 
paper or any other periodicals. 

Senator Tobey, You read those things about him? 

Mr. Cohen. I i-ead the story. 



276 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobey. So you did know, as far as the medium of Collier's- 
goes, he was engaged in political activities in California? 

Mr. Cohen. I don't know that. 

Senator Tobey. Would you know the man if he walked into this room 
now? 

Mr. Cohen. Samish; sure. 

Senator Tobey. Did you have any business dealings with him? 

Mr. Cohen. No. 

Senator Tobey. Did you ever do any work for him? 

Mr. Cohen. No. 

Senator Tobey. Have you ever done any favors for him? 

Mr. Cohen. No. 

Senator Tobey. Did he ever call you to come and see him? 

Mr. Cohen. No, sir. 

Senator Tobey. Now, this is a good question : In this tailor shop of 
yours did you ever equip Mr. Samish with any clothing? Did you 
ever sell him aiiy clothing? 

Mr. Cohen. Yes, Senator. 

Senator Tobey. You have sold him some clothing? 

Mr, Cohen. The tailor shop has. 

Senator Tobey. To what extent ? 

Mr. Cohen. I don't even know. He has bought some clothing. He- 
paid cash for them. He has paid all his bills. 

Senator Tobey. Mr. Chairman, I cannot go any further here now, 
but it well may be that this committee should go into this matter more 
fully. 

The Chairman. Mr. Cohen will remain under subpena. We can have 
him back if we need him for further questioning. 

Mr. Strong. Today or tomorrow ? 

The Chairman. We will notify 3011 ; we will notify either you or 
Mr. Cohen. 

Senator Wiley. I have a few questions. 

I think I heard you state or infer that the police department was- 
against you. Why should they be against you? 

Mr. Cohen. I can't answer that, Senator ; I don't know. There never 
has been a man that has had the harassment that I have had in the 
whole United States. They arrest me when I am here. Tlien if I want 
to leave here they make sure the people, wherever I go, arrest me. If 
they don't want me here why don't they leave me alone when I go 
some place else ? 

Senator Wiley. Do you know Mayor Bowron ? 

Mr. Cohen. No, I don't. 

Senator Wiley. Did you participate in the campaign to try to get 
him recalled? 

Mr. Cohen. I did not. 

Senator Wiley. Have you ever been mixed up in politics ? 

Mr. Cohen. No, sir. 

Senator Wiley. I understand that you have a family? 

Mr. Cohen. Yes. 

Senator Wiley. A wife and how manj^ children ? 

Mr. Cohen. No children. Senator; just two dogs. 

Senator Wiley. I have no further questions. 

The Chairman. What business do you have with Tony Gearidino? 
Do you see him often when you are in St. Louis ? 



ORGA^nZED CRIME IN INTERSTATE COMMERCE 277 

Mr. Cohen. I saw him just once. 

The Chairman. Did 3^011 call him on the telephone ? 

Mr. Cohen. No; Mr. Greenberg called him to come over and say 
liello. We hadn't seen each other for a few years. He came over to 
pay his respects. 

The Chairman. "What business do you do with Sam Mazzeo at 
•<jralveston, Tex.? 

Mr. Cohen. None. 

The Chairman. How does it happen that you have his number ? 

Mr. Cohen. He was here. He came to a charity party that I threw 
and I sat and talked to him and he gave me his number in case I came 
down that way and to say hello. 

The Chairman. So you just kept his number? 

Mr. Cohen. That is true. 

The Chairman. What was the last fighter that you handled? 

Mr. Cohen. Willie Joyce. 

The Chairman. Did you have some negotiations with Herman 
*"Mugsy" Taylor in Philadelphia? 

Mr. Cohen. Yes, sir; I did. 

The Chairman. How long ago has that been? 

Mr. Cohen. Six or seven years ago. 

The Chairman. You had a fighter at tliat time? 

Mr. Cohen. Yes. 

The Chairman. Willie Joyce? 

Mr. Cohen. That is right. "^ 

The Chairman. Did you take him to Philadelphia to fight with 
Taylor's man? 

Mr. Cohen. Not Taylor's man ; with Ike Williams. 

The Chairman. Taylor was the promoter, was he ? 

Mr. Cohen. Yes, sir ; he was. 

The Chairman. Did you help Frank Sinatra promote a fight in 
San Francisco ? 

Mr. Cohen. No, sir. 

The Chairman. You didn't know anything about it ? 

Mr. Cohen. Frank may have talked with me about it ; I didn't help 
him in any way. 

The Chairman. Is he an old and good friend of yours ? 

Mr. Cohen. Frank Sinatra, I consider him a good friend. 

The Chairman. Does he visit with you often ? 

Mr. Cohen. He hasn't visited with me for, maybe, 3 or 4 years. 

The Chairman. He did try to promote some fights, didn't he? 

Mr. Cohen. I think he did. 

The Chairman. Did some of your fighters fight in fights that he 
promoted ? 

Mr. Cohen. No. We may have had some conversation on fighi s, but 
that is about it. 

The Chairman. Let me ask you again. What was this gambli ig op- 
eration that you had up where the airport is, at Burbank o near 
Burbank : what was that gambling operation ? 

Mr. Cohen. What was it ? 

The Chairman. What \vas the name of it ? 

jNIr. Cohen. The Dincara stock farm. 

The Chairman. Tell us again who the partners were. 



278 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Cohen. I was in partners with a fellow by the name of Einstace. 

The Chairman. Who else was a partner ? 

Mr. Cohen. I don't know. 

The Chairman. Could you find out who the partners were ? 

Mr. Cohen. It was quite sometime ago ; I will try to find out. 

The Chairman. Were you ever raided up there ? 

Mr. Cohen. I never was there. All I did was have a piece of it. 
I put my money up. 

The Chairman. Did you go up and see about it from time to time ? 

Mr. Cohen. No, 

The Chairman. Did you make a profit out of it ? 

Mr. Cohen. I think so ; it was no hig deal. 

The Chairman. Who handled the money ? 

Mr. Cohen. They did. 

The Chairman. In these various operations around here in Los An- 
geles, and in this section of the country, do you get any police 
protection ? 

Mr. Cohen. None whatsoever. They have driven me crazy around 
here. 

The Chairman. I mean when they weren't driving you crazy, were 
you getting any police protection ? 

Mr. Cohen, Nobody has ever protected me. They have done every- 
thing else but. 

The Chairman. These craps games that you operated 

Mr. Cohen. There was no protection to them at all. 

The Chairman. How do you operate a craps game with people 
coming in ? 

Mr. Cohen. These were no games that were banked, like you see 
in Las Vegas, Senator. These were games that everybody shot among- 
themselves and the house took a cut. 

The Chairman, Do you have one of these collapsible craps tables 
that you can put into the back of a car ? 

Mr, Cohen, It wouldn't fit into the back of my car. I had one but 
it wouldn't fit. 

The Chairman, You had a collapsible table that you could carry 
from place to place ? 

Mr, Cohen. But not to put into your car. 

The Chairman. But you could transport it in a truck or some- 
thing like that? 

Mr. Cohen. Yes, 

The Chairman, And it was collapsible so you could take it intoi 
a house or out of a house without taking it down? 

Mr, Cohen, You had to take the sides off of it to carry it. 

The Chairman, I have nothing else. 

Mr. Halley. Nothing else. 

Mr. Robinson. No questions. 

Senator Tobey. No questions. 

The Chairman. Mr. Cohen, you will remain under subpena, but yoii 
need not stay here. If we need you we will get in touch with you or 
with your lawyers. 

Mr. Strong, In connection with our immunity position, we would 
like to have you mark this, the front page of the Los Angeles Times 
for Friday morning, November 17, 1950, indicating what the com- 
mittee is investigating as to income tax. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 279 

The Chairman. We will make the morning Los Angeles Times, for 
Friday morning, November 17, 1950, a part of the record of Mr. 
Cohen's testimony. 

That will be all, thank you. 

Mr. Hall-ey. The next witness w^ll be Sheriff Biscailuz. 

Tlie Chairman. We will take a short recess first. 

(Short recess.) 

The Chairman. The committee will be in session. The commit- 
tee has rearranged its schedule for hearings on this trip through Cal- 
ifornia. It was our plan to proceed to San Francisco tonight and 
have hearings there tomorrow, but in view of the length of time 
that some of the witnesses have taken for examination and other 
developments that have come up here, we have decided to postpone 
the hearing in San Francisco until next Tuesday. 

We will begin at 10 o'clock in the Federal Building next Tuesday 
in San Francisco for 2 days. We will have a further executive hear- 
ing here in the morning beginning at 9 : 30. All of the witnesses who 
are under subpena and who have been called, can be excused for the 
rest of the afternoon, if they wish, but report back tomorrow morning 
at 9 : 30 o'clock. We will endeavor to conclude by 1 o'clock tomorrow 
afternoon. 

Sheriff Biscailuz, will you take the stand. 

TESTIMONY OF EUGENE WARREN BISCAILUZ, SHERIFF, 
LOS ANGELES COUNTY, CALIF. 

The Chairman. Sheriff Biscailuz, 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 ? 

Sheriff Biscailuz. I do. 

The Chairman. Sheriff Biscailuz, what is your full name? 

Sheriff Biscailuz. Eugene Warren Biscailuz. 

The Chairman. Yesterday — before we start the examination, I 
might tell you that we had before us Mr. Arthur C. Jewell, the under 
sheriff. In connection with some matters, particularly the Guarantee 
Finance Corp., his testimony as to what went on was highly unsatis- 
factory to the committee. We would be glad to have you clarify any 
matters in connection with that and tell us what you know about it. 

Sheriff Biscailuz. Very well. 

The Chairman. We are very anxious to get all of the facts that you 
can give us. Before proceeding with the examination, is there any 
general statement that you wish to make? 

Sheriff Biscailuz. I would like to, if the committee will allow me, 
to make certain statements, and to make as part of the proceedings, if 
it is in order, to present this and to read, at least part of it, and then 
give 3'ou for the record the report that Captain Pearson made to me 
upon my request. 

The Chairman. You read from the report to the extent you wish 
and then the whole record will be filed as an exhibit to your testimony. 
I understand that you have been in the State of Washington to a law- 
enforcement officers' convention. 

Sheriff Biscailuz. Yes, I am president of the Pacific Coast Inter- 
national Peace Officers Association, and was there on Monday and 



280 ORGANIZED CRIME. IN INTERSTATE COMMERCE 

Tuesday for the session and then was in Vancouver and back to Seattle 
when I received the message. 
Now, I would like to read from the report. 

From : C. H. Pearson, captain. 
To : E. W. Biscailuz, sheriff. 

Subject : Guarantee Finance Co., Jacobs Surplus Supply Co., Southeast Credit 
Service, Allen Brokerage Co., E. "V. Johnson, Phillips Furniture Storage, 
Stone's Service Station, Florence Avenue Secretarial Service, C. L. Hand- 
ley, Fashion Lane Dress Shop, Cole King Advertising Agency, Good News 
Press, Secretarial and Alarm Service, Club Membership Solicitors, Memorial 
Stone Maintenance Co. 
Above located at 1747, 1747 Va, 1749, 1751, 1753, 1755 East Florence Avenue. 
Much has been said about the laxity on the part of the anti-vice and narcotic 
detail insofar as the enforcement of the bookmaking laws particularly pertaining 
to the Guarantee Finance Co. 

1 made a careful search of the daily reports submitted by the crew sergeants 
on their activities which cover the following dates and the results of the investi- 
gations which various members of this detail made : 

Then it gives certain dates and activities on those dates as you can 
see. I think I can save some time for you, but I will read some of these. 

January 26, 1946 : Lisa, Estes, and Molin on stakeout at 174714 East Florence, 
No activity observed. 

January 29, 1946: Estes staked out at 1747y2 East Florence Avenue. No 
activity. 

January 29, 1946: Hallinan staked out at 1747l^ East Florence Avenue. No 
activity. 

February 9, 1946 : 7 : 25 p. m., Lisa, Acosta, Hallinan, Estes, Molin, and Kapie 
checking 17471/2 East Florence for gambling. All dark. 

February 19, 1946: Estes and Hallinan staked 17471/4 East Florence. No 
activity observed. 

February 21, 1946: Estes checked 1747i/^ East Florence. No activity. 

March 2, 1948: Jones, Crawford, McKiuney, and Schalter checked lV47i/^ East 
Florence for gambling. No activity. 

March 5, 1946: Molin, Whipple, and Acosta checked 17471/2 East Florence for 
bookmaking. No activity observed. 

March 15, 1946 : Lisa and crew met Kapic and crew — proceeded to 17471^ 
East Florence and checked re bookmaking. Could not gain entrance to place ; 
called on phone but no racing information could be had. 

March 18, 1946 : Hallinan, Lisa, and LaFever to 1747l^ East Florence on 
stakeout. No activity observed. 

March 19, 1946 : 7 : 30 p. m. to 10 : 15 p. m. Jones and Schaffer staking on 1747l^ 
East Florence re possible gambling. No trafdc or activity noted this date. 

March 21, 1946: 10 a. m. Lisa and Acosta to 17471/2 East Florence Avenue re 
bookmaking. No activity. 

March 21, 1946: 8:15 p. m. McKinney checking 1747i/> East Florence for 
possible gambling. Verbal report to be made. 

March 22, 1946 : 8 : 45 a. m. Lisa and Acosta to 17471/4 East Florence on stixkeout 
re bookmaking. No activity and no one entered premises. 

April 13, 1946: Night crew checking 17471/2 East Florence for gambling. No 
activity. 

After the first 4 months of 1946 the records do not reveal that any complaints 
were received by the detail and therefore no recorded investigations were noted. 
However, Sergeant Kapic was well aware of the previous complaints lodged 
against the above4isted names and locations and was instructed that when- 
ever in that vicinity he should give the place a check to ascertain if any activities 
were taking place. I have talked to Sergeant Kapic about this and he has assured 
me that on many occasions he had either himself or had members of his crew 
check this location and also call various telejihone numbers which were listed 
and at no time did they ever obtain any leads that would indicate that book- 
making was carried on here. 

Sheriff Biscailuz. I don't know if I should take the time to read 
all of it to you. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 281 

The Chairman. You read what you wish. 

Sheriff Biscailuz. All right, Senator. 

The CiiAiRMAisr. We will file this with the record. 

Sheriff Biscailuz. If the document is going to be filed then I will 
just read from certain portions of it. I will go to page 5 and read 
a few more entries. 

Subject : Martin Kobey et al. 

December 16, 1948 : Kapic, Grant, and Jones staked on 1747^2 East Florence. 
No violation observed. 

December 17, 1948 : Kapic, Grant, and Jones staked on 1747% East Florence. 
No violation observed. 

December 21, 1948 : Runyon and McNair staked on 1747^/^ East Florence. No 
violation observed. 

December 28, 1948 : Grant, Jones, and Schaffer staked on 1747^2 East Florence. 
No violation observed. 

December 29, 1948 : Crew No. 2 staked on 1747^2 East Florence Avenue. No 
violation observed. 

December 30, 1948: Allen, Bowie staked on 1747i/^ East Florence Avenue. 
Verbal report. 

December 31, 1948 : Prospective raid on 1747^/^ East Florence by crevps Nos. 1 
and 2. No violation observed. 

Then reading further: 

On the strength of verbal report made by Deputies Allen and Bowie, December 
30, 1948, I made arrangements with the telephone company to supply me with 
certain information at 11 : 55 a. m. on December 31, 1948. On December 31, 
1948, both crews were detailed within a short distance of the Guaranty Finance 
Co. fully equipped with door-opening devices and an extension ladder to make 
forcible entry at 1747% East Florence Avenue at approximately 12 : 05 p. m. 
and instructed to call the office at noon sharp as the information I had asked for 
from the telephone company would have been received from the telephone com- 
pany as per arrangements and was informed that the phones at 1747% East 
Florence Avenue were absolutely inactive. Therefore, when the crew sergeant 
phoned the office at noon I told him the raid was off, to dismiss the night crew 
and to return to the office with his crew. 

As I have previously reported to you, another stake-out was conducted from 
January 17, 1949, to and including January 31, 1949, the purpose of this stake- 
out, as you are well aware, was to ascertain where the bookie joints were located 
whose agents or runners were hanging around the Guaranty Finance Co. and if 
possible we had hoped to obtain the necessary information upon which to obtain 
a conspiracy complaint against all concerned. 

It was while this investigation was under way that all the activity was halted 
when the corporation commissioner seized the books of the Guaranty Finance Co. 

I believe that the data covered in this report is more than sufficient to contra- 
dict any accusations of laxity or of pay-offs, as you will note that a large as- 
sortment of men were used in the stake-outs and if any pay-offs were in vogue 
it certainly would have been conliued to a few persons and not to the entire de- 
tail. 

I do have certain notes still in my own personal file that I have not referred to 
here as it would entail too long a report and they are not too important but do 
tie into certain remarks that have been passed by various persons and groups. 

Respectfully submitted. 

C H. Pearson, 
Captain, Anti-Vice and Narcotic Detail. 

I would like to give this to you. 

The Chairman. This report dated February 14, 1950, will be made 
a part of the record as exhibit No. 15. 

(Exhibit No. 15 is on file w^ith the committee.) 

Sheriff Biscailuz. Would it be in order for me to make further 
general statements? 

The Chairjman. Yes. 

68958— 51— pt. 10 19 



282 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Sheriff Biscailuz. We have in our organization, the sheriff's office, 
an antigangster squad that travels throughout the unincorporated 
area of Los Angeles County nightly and consists of 12 men. I wonder 
if I could get this into the record, because I want to show that our 
office is cognizant of the fact that there was crime in Los Angeles Coun- 
ty and it is the duty of the sheriff to do everything he can to minimize it 
as far as he can, with the tools that he has to work with. 

Here is the way we do this, I would like to hand this to the com- 
mittee as an outline of our activities, the activities of those squads. 

All the way through here, sir, it gives the same procedure of the 
activities of the antigangster activities in the unincorporated and in 
the Hollywood district. When I say the ''Hollywood district" it 
means the unincorporated area and the Gardena area where the card 
clubs are. That is an incessant patrol that we have going on and have 
had going on now" for approximately 2 years. 

The Chairman. This document that you have referred to is dated 
November 6, 1950. 

Sheriff Biscailuz. I just picked one out of a lot of them over there. 
That doesn't mean anything except that it is just one of many reports. 
The Chairman. We will make that exhibit No. 16 to your testimony. 
(Exhibit No. 16 is on file with the committee.) 
The Chairman. Do you have any other general statement ? 
Sheriff Biscailuz. I would like to state, sir, that we have 4,088 
square miles of territory in Los Angeles County. We do happen to 
be the largest sheriff's office in the United States of America. We 
have 62 departments of the superior court in comparison to 9, 44 years 
ago. 

We have in our Angeles County jail 3,000 inmatess on the top 5 
floods of the Hall of Justice. We have besides that 1,500 in our Honor 
Rancho and honor camps throughout tlie county. 

The sheriff of Los Angeles County holds a nonpartisan office here. 
The office is not a political organization. The sheriff is elected for 
4-year terms and can be reelected. His name appears on all the bal- 
lots before the public. If he gets a majority of the votes in the pri- 
maries he can bei declared elected and he does not have to run in the 
final election in November. 

Senator Tobey. Does his remuneration come from straight salary 
only ? 

Sheriff Biscailuz. When I first started in the office the salary was 
inconsequential and the fees considerable. Now the sheriff is on a 
$15,000 a year salary with no fees or emoluments. 
Senator Tobey. I think that is better, don't you ? 
Sheriff Biscailuz. Yes. Also we are an organization of civil serv- 
ice. The sheriff is elected, of course, and the undersheriff is appointed 
by the sheriff. The entire crew of nearly 1,800 comprise our entire 
organization. They are under civil-service rules and regulations. 
The Chairman. Is that Los Angeles city civil service ? 
Sheriff Biscailuz. Los Angeles County civil service. 
The Chairman. Was Undersheriff Jewell appointed by you? 
Sheriff Biscailuz. Yes. 

The Chairman. He does act as sheriff when you are out of the city. 
He is an adiiiinistrative officer to look after the details when you are 
gone ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 283 

Sheriff Biscailuz. Yes. He is connected mostly with that which 
has to do with administration. If the sheriff is incapacitated the cor- 
oner wonld take over until a successor is appointed. An undersheriff 
can take the duties over but everything is done and every act is done 
in the name of the sheriff. 

The Chairman. Anyway, he is the second officer in command, is he ? 

Sheriff Biscailuz. Yes. 

Mr. Halley. What is the jurisdiction of your office? 

Sheriff Biscailuz. We have the entire unincorporated area of 
Los Angeles County, of 45 cities in Los Angeles County, including the 
metropolitan city of Los Angeles. Then we have, of course, Pasadena, 
Santa Monica, and so forth, but there are still over-three quarters of 
a million people living outside of the incorporated cities of the county. 
The sheriff is like the Los Angeles chief of police. Our duties are the 
same except the sheriff has the added duties of being the keeper of 
the jails. He serves warrants and handles all the matters in the civil 
division. Also, as far as felonies are concerned, he operates in cities 
and counties in Los Angeles County. When it comes to a local ordi- 
nance, unless called upon by the local authorities there, either the 
chief of police or the mayor, he does not go into localities to enforce 
local ordinances. 

Mr. Halley. Does he have concurrent jurisdiction with the police 
of the various cities on felonies ? 

Sheriff Biscailuz. No, he has his own jurisdiction. He can go into 
any city in the county on warrants for felonies, yes. 

Mr. Halley. That is what I mean. That runs concurrently with 
the power of the police to do the same thing ? 

Sheriff Biscailuz. That is right, sir. 

Mr. Halley. Is there any State law-enforcement authority which 
parallels that of the sheriff? 

Sheriff Biscailuz. No, except, of course, we have the California 
Highway Patrol that polices the State highways within the counties 
of the State of California. I think I am right about that. I think 
that is all there is that I can think of. 

Mr. Halley. What would you say is the state of law enforcement in 
the Los xlngeles County area today? 

Sheriff' Biscailuz. You mean what kind of law enforcement we 
have ? 

Mr. Halley. Are the laws enforced ? Are you able to enforce them 
successfully ? 

Sheriff Biscailuz. I have always said this, that laws that have to 
do with felonies and crimes against a person, we have never had any 
trouble in getting all the assistance that people wish to give us and 
do give us. When it comes to that which has to do with gambling and 
bookmaking, you will find then that is where we may have a little 
more difficulty. Those who know that robbery or murder is wrong 
in itself do not in many instances consider gambling and bookmaking 
wrong, and placing or making a bet anything too serious. They are 
the ones, of course, that we have to deal with. That is Avhy we have 
more trouble always in enforcing the gambling laws than we do any 
other part of our duties, or in anything else that may come up within 
our jurisdiction. 

Mr. Haley. How many men do you have available ? 



284 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Sheriff Biscailuz. In our entire organization there are 1,800. The 
sheriff, also, is an officer of the court. Each department of the supe- 
rior court has a bailiff who acts in the name of the sheriff. We have 
the civil division. We have a civil division, a criminal division, a bu- 
reau of records and identification, and the jails division. The uniform 
division and the detective division are also in the sheriff's office and 
besides that we have a division that has to do with corrections. 

Mr. Halley. Well, what I am getting at is, how many men are 
•available for criminal work ? 

Sheriff Biscailuz. We have available for criminal work, with our 
'detective bureau, probably out of that number approximately 150. 
I forgot to say this : That we have in the county, in the unincorporated 
area, stations. We used to call them substations, and in each unin- 
corporated area we have a station just like a police precinct or head- 
quarters where a captain is assigned to each one of these stations with- 
in the county. 

We have two-way radio cars and practically the same equipment 
and the same modus operandi that any large police department would 
utilize. 

Mr. Halley. How many men are in this group? 

Sheriff Biscailuz. In that group I can't tell you exactly. Let's see ; 
150 — there must be a thousand altogether. 

Mr, Halley. Working on criminal matters? 

Sheriff Biscailuz. Yes. Not only criminal matters, because they 
are also patrol officers that go out in the prowl cars that police every- 
thing in that particular area. 

Mr. Halley. We asked your deputy yesterday whether he could give 
the committee any information about gangsters, law violators, operat- 
ing in the county. That was in accordance with the committee's usual 
procedure to ask such help from law-enforcement officers in areas in 
which it goes. He was not able to give us any specific information at 
all. I wonder if you are able to provide such information. 

Sheriff Biscailuz. I will tell you frankly, I have never even met, 
in my life, Mickey Cohen. I only met, in our Los Angeles county jail 
Bugsy Siegel. I have not made it part of my duties to go out into the 
unclerworld and to catalog these people because I thought that was 
the duty of the men who were assigned by the sheriff to do that work. 
I might prove nearly as ignorant, if you wish to call it that, on that 
score. We depend on that information by just asking for it. 

Mr. Halley. Have you ever asked for that information ? 

Sheriff Biscailuz. From time to time, yes. Whenever there is any- 
thing, any killings or anything else, we have that information and 
immediately work with the other departments that are working on 
the same case. 

Mr. Halley. There have been a number of unsolved gang murders, 
liave there not been, in tliis area ? 

Sheriff Biscailuz. Yes. 

Mr. Halley. Have you personally interested yourself in the solu- 
tions of those murders ? 

Sheriff Biscailuz. We have, sir, and we have worked for months and 
months tirelessly on these cases and yet, again, I don't believe that we 
are any worse off here in Los Angeles County than in any other part of 
;the country. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 285 

Mr. Halley. I wasn't referring so much to the inability to solve 
those murders, Sheriff, as to the question of whether in the course 
of these investigations either you or your chief deputy had learned 
anything about the structure of criminal activities in the county. 
We were unable to get a«ny help at all from your deputy, which seemed, 
at least prima facie, to indicate that he wasn't as well informed as 
some of the other law-enforcement officers who appeared before the 
committee and were at least able to give us some ideas. 

Sheriff Biscailuz. We have that information in our office and can 
get it b}^ pressing a button in our record bureau and in our bureau of 
investigation. 

Mr. Halley. Do you have any of that information in your head ? 
Sheriff Biscailuz. Just from the standpoint of some of the leaders 
of the gangs. 

Mr. Halley. Who are some of the leaders ? 

Sheriff Biscailuz. At the present time I don't know who you would 
call a leader and w^ho is not. You have Mickey Cohen, for instance; 
you have Dragna. There are those who have been mentioned, and 
men of that type. I have got them on my desk. At the present time 
I couldn't go down the list and give you 15 or 20 of them. 

Mr. Halley. Have you any idea of whether there is or is not any 
organized criminal activities in Los Angeles County ? 

Sheriff Biscailuz. I can say this : If it is organized at all, it would 
be from the information that we have had : That we do not have any 
more organized crime than they have in other places and that we are 
in the same position as large cities are anywhere. I believe we have 
solved our fair share of all these crimes that have been committed. 

Mr. Halley. In the course of trying to solve your fair share of 
crimes, have you not personally obtained some knowledge of the nature 
of organized criminal activities in this area, if indeed there are such 
activities ? 

Sheriff Biscailuz. Just from the standpoint of general knowledge 
and what our chiefs in our divisions have in their records and are 
using at all times in their work. 

Mr. Halley. Is there nothing more specific that you can tell this- 
committee now? For instance, what is Mickey Cohen doing these 
days ? Who are his associates ? Do they have criminal records ? 

Sheriff Biscailuz. We do know that some of Mickey Cohen's con- 
freres have criminal records. We know that he was in Los Angeles 
County of the Strip for a long time. He is no longer in business 
there. At one time he was in business in the city of Los Angeles on 
La Brea Avenue, where he had a gambling joint for 2 or 3 years. I 
remember that. I know that he lives on Moreno. It is right within 
the city of Los Angeles, just this side of where the city of Santa Monica 
begins, where I live. We have general knowledge of that. I assure 
you that I feel the office of the sheriff of a county is to administer the 
organization and to have under him the proper men. 

I am talking r.ow about the chiefs, inspectors, and captains and those 
whose duty it js to see to that. It is their duty to make reports to us 
from time to time on everything that occurs. 

We have an organization that is a big one. Its duties are, you might 
say— I don't think there is a sheriff's office in tlie world that has the— 
I mean in this country— that has the multitude of duties that have ta 



286 ORGANIZED CRIME IX INTERSTATE COMMERCE 

be performed. The sheriff of this county does not have to become a 
specialist in that — just in that one thing — in becoming familiar with 
the underworld. That is not his only duty. He has to keep pace 
with everything that is going on in the county. 

Mr. Halley. Well, let's be more specific. You do have a special 
gang squad ^ 

Sheriff Biscailuz. Yes, sir. 

Mr. Hallet. Haven't tliey been able to build up a dossier on the 
chief criminals ? 

Sheriff Biscailuz. Surely. 

Mr. Halley. Do you have any knowledge of it ? 

Sheriff Biscailuz. We have it there in the office. I don't have it 
right here. 

Mr. Halley. But neither you as sheriff or the under sheriff have any 
jDersonal knowledge of that? 

Sheriff Biscailuz. We weren't asked to bring anything like that 
over here. It could have been brought over. 

Mr. Halley. In addition to Mickey Cohen are there any other 
people who are suspected of criminal activities on a large scale? 

Sheriff Biscailuz. Plenty of them but not any famous characters 
that are around. 

Mr. Halley. Any who are suspected of operating with an organiza- 
tion and linked throughout the underworld? 

Sheriff Biscailuz. You hear a lot of names; but at the same time, 
you are not so sure whether that information is actually correct. You 
will hear from time to time names like Smiley and this boy over at the 
city hall, the old boy that used to be around the city here so much. 

Mr. Halley. Do you mean Dragna or McAfee ? 

Sheriff Biscailuz. The fellow that was shot out at Lucey's place. 

Mr. Halley. Utley? 

Sheriff Biscailuz. Yes, Jimmie Utley. There is another one that 
has quite a reputation in his own ranks, although there is another 
fellow — he is another fellow I have never done any business with. 
Maybe I am a "babe in the woods" in that regard. 

Mr. Halley. When was Utley shot at Lucey's Place ? 

Sheriff Biscailuz. About 8 or 4 years ago. 

Mr. Halley. Who shot him? 

Sheriff Biscailuz. Wlio shot him at that time ? Well, they are still 
trying to find out. 

Mr. Halley. Did you hear that Mickey Cohen was supposed to have 
pistol-whipped him out at Lucey's Place ? 

Sheriff Biscailuz. I have heard it; yes, but that is all I can say. 

]VIr. Halley. We heard him deny it today. 

Sheriff Biscailuz. That was right in the middle of the day, too, 
when that happened, at lunchtime, about 1 o'clock in the daytime. 

Mr. Halley. We have the problem here of this committee, which 
is certainly not a law enforcement committee, as you know, and cer- 
tainly not trying to solve specific crimes, but rather we are trying to 
ascertain the relationships between various criminals. We hear that 
a man is supposed to have been pistol-whipped by a notorious criminal 
in broad claylight with about 100 people watching in a restaurant. 
Apparently there has been no specific investigation into that. 



ORGAlSnZED CRIME IN INTERSTATE COMMERCE 287 

Sheriff Biscailuz. Well, there must have been because the police 
department and every other agency have been working on that. It 
wasn't a matter of no one doing anything about it. 

jNIr. Hallet. Would you be unable to get any witnesses out of 100 
persons in a restaurant that viewed that? 

Sheriff Biscailuz. It is very possible not to get one. 

Mr. Halley. Would that be due to intimidation ? 

Sheriff Biscailuz. Yes, and also fear of not wanting to be in a 
position of getting bumped off. 

Mr. Halley. Fear of reprisal, you mean? 

Sheriff Biscailuz. Yes, sir. 

Mr. Halley. You think that is what is preventing witnesses from 
coming up and testifying? 

Sheriff Biscailuz. I know it would help a lot in preventing them 
from doing so, from testifying. 

]\Ir. Halley. Is there any way that people can be safeguarded 
against things like that, against that fear? 

Sheriff Biscailuz. A campaign of education where they would 
have to realize their duty to their community was worth more than 
their own lives. 

Mr. Halley. What can you tell us, say, of the operations of Jimmie 
Utley? 

Sheriff Biscailuz. I know very little about Utley except that he is 
supposed to be one that has had books and keno games and things 
of that kind. We, in our office, have had no particular dealings with 
him. 

Mr. Halley. Do you know who operates wire services in Los 
Angeles County? 

Sheriff Biscailuz. I couldn't say. I remember once the Brophys 
were in the picture, but at the present time I don't know. 

Mr. Halley. Have you any information you can give the commit- 
tee of the operations of Jack Dragna? 

Sheriff' Biscailuz. No, I haven't. I know he has been around here 
for some time. He claims, of course, to be a respectable businessman 
now. He used to be quite active in prohibition days around here. 
He is another fellow that hasn't been brought to our attention in Los 
Angeles County activities. 

]\Ir. Halley. Have you heard statements made that criminals have 
a tendency to move out of a city into the county in order to operate in 
the county more easily ? 

Sheriff' Biscailuz. Yes; that happens from time to time, sir. 
Mr. Halley. Would that be because you have fewer law-enforce- 
ment officers in the county ? 

Sheriff Biscailuz. No, but it may be because they think they can 
make arrangements. A lot of things run through their minds. They 
think, if they go over here, the chief of police would be more lenient 
than the one in the other place. I don't mean, by saying that, that that 
official is that way, but this fellow may have been sold a bill of goods 
by saying — by someone saying that he could do better over here rather 
than at tlie other place. 

Mr. Halley. One instance of that has come to the committee's 
attention. It is tlie Guarantee Finance Co. case. They operated in 
the county just outside of the city? 



288 ORGANIZED CRIME IN INTERSTATE COIVIMERCE 

Sheriff Biscailuz. That is right. 

Mr. Halley. That is the situation the committee was talking about. 
We were talking to your deputy about that yesterday in an effort to 
find out whether that might have been an example of why gamblers 
and criminals felt that it was easier to operate in the county. Do you 
have any personal knowledge about that case ? 

Sheriff Biscailuz. Yes ; I do have some personal knowledge about 
it. Of course, that place, we found it had operated — in other words, 
did business in several cities in the county of Los Angeles as well as 
in the unincorporated areas. 

Mr. Halley. Had it been under investigation by your office? 

Sheriff Biscailuz. That report that has been read, I think, would 
cover that. 

Mr. Halley. Do you recall that the Guarantee Finance Co. was 
raided by the corporation commissioner's office on January 13, 1949? 

Sheriff' Biscailuz. Yes. 

Mr. Halley. Do you recall that a Mr. Robinson, then the chief in- 
vestigator for the California crime commissioner, and now the chief 
investigator for this committee, telephoned you on that occasion? 

Sheriff Biscailuz. Yes, but before that Mr. Olney called me. I 
think it was the day before, and he told me that Mr. Robinson would 
be calling, and would need some assistance. I am just using those 
words ; that probably isn't the exact conversation. I told him, "Fine. 
When Mr. Robinson calls me I will do everything I can to assist him." 
So the next day Mr. Robinson did call me, I believe. I immediately, 
as the procedure in the office and the custom of the office, if you wish 
to call it that — I called Captain Pearson, who was the captain of the 
vice squad at that time, and told him that I thought that either Mr* 
Robinson was going to call him or that he was going to come in to see 
him and ask for some help. He told me he would give him every 
assistance. That is the way that happened. 

Mr. Halley. You know what happened is that, when Mr. Robinson 
spoke to Captain Pearson, Captain Pearson said he could not make 
any men available. 

Mr. Robinson. As I recall it — and you can correct me if I am 
wrong — Mr. Warren Olney called you and spoke to you personally on 
the morning of the raid ; early on the morning of the raid. 

Sheriff Biscailuz. I don't remember the exact time. 

Mr. Robinson. It was early in the morning. 

Sheriff Biscailuz. Was that in January ? 

Mr. Robinson. It was in January. The corporation commisioner 
was then about to move into the Guarantee Finance Co. premises, and 
he invited you to participate. It was the second time that I called 
you and stated that the corporaion commissioner's men had advised 
me of the bookmaking parapharnalia they had found out there ; that 
their process only extended to the loan premises, and there was no way 
within their process that they could gain access to the big pit room 
upstairs. It seemed as thougli some law-enforcement agency should 
be on the spot in order to gain access to the second floor, if at all 
possible. It was at that time you referred me to Captain Pearson 
and asked me to acquaint Captain Pearson with those facts. 

Sheriff Biscailuz. That is correct. That is where the crux of this 
entire matter lay, as far as the Guarantee Finance Co. is concerned, is 
from the standpoint of the allegations or claim that the sheriff's office 



ORGANIZED CRIME IN INTERSTATE COMMERCE 289 

did not assist or cooperate in the Guarantee Finance Co. raid. If that 
assignment had gone over as scheduled and as I wanted it to go over 
and had been called to my attention again — you know, every dog is 
entitled to one bite. We all make mistakes. We can't watch every- 
thing in the scheme of things. I never denied that that call came to 
me, and I will never shift the responsibility that is mine as sheriff by 
putting it on the shoulders of men who are in our office. 

At the same time, I wdll not, on rumor or by any other mode that is 
not from a legal standpoint, I can't under civil-service regulations 
throw them out, but a mistake in this matter was made by Mr. Pearson 
in not finding men immediately from somewhere to go down there, 
because that was what he was told to do. He has told me from time 
to time he would like to appear somewhere and be able to give his 
side of the story, but he never has had that opportunity as yet, that I 
know of. 

He simply swears by all that is holy that as far as that Guaranty 
Finance office is concerned there, as far as he is concerned, rather, 
there was no ulterior motives or anything else like that. If it weren't 
for that call and that information, that call from Mr. Olney first and 
then your contact, I don't believe that the Guarantee — or I mean the 
crime commission — could have ever accused the sheriff's office of not 
cooperating, because I want to say that I can tell you that we are the 
best cooperators in the world. We make mistakes, but every chief of 
police in the county, your Federal officers here and the FBI, all would 
come in and testify that they receive from the sheriff's office of Los 
Angeles County the best cooperation there is. 

On that particular case I will say that something went haywire that 
shouldn't have gone haywire. If it hadn't been for that, we would 
have gone along nicely. I do feel there should have been a follow-up 
there, Mr. Robinson. 

Now, I was on the Governor's crime commission. I have been on 
liis different commissions with him for many years. I have been on 
liis disaster council. I have been representing law enforcement for 
the entire State of California and have been reappointed by several 
governors every 4 years to sit on these different committees. 

What I felt badly about afterward is when the crime commission 
report came out with that great blast, that hurts anybody in public 
office, that that could all have been obviated if there had been a follow- 
up, where if you could have come, and whoever it was, and said, 
"Sheriff, there is something going wrong ; we had better look into it," 
but never did I hear any more from anyone that I know of about the 
follow-up so we could put our house in order if it had to be placed in 
order. You see, that crime commission report came out then. That 
is nearly 2 years ago, I believe ; a year and a half ago. Then, when I 
was running for office here in the primaries, the crime commission re- 
port, verbatim or excerpts of it, were in the ads of my opposition, who 
spent $125,000 to defeat me or to get their man on the ticket. Every- 
thing was in there from the crime commission report and why the 
slieriff had been derelict in his duties. 

I will say right now. if that had been handled the other way, the 
sheriff would never have been accused of dereliction, because we have 
been in that office for many, many years. We have made a lot of mis- 
takes, and this is my fifth term, but it has done me irreparable harm. 



290 ORGANIZED CRIME IN INTERSTATE COMMERCE 

If it weren't for the fact that people have had a lot of confidence in 
my integrity, the harm would have been still greater. 

I am president of the Pacific Coast International Police Association. 
I had to be at this convention because I am president of the association. 
Even up there I was startled by headlines on Sheriff Biscailuz, and so 
forth and so on. 

That is the third time that I have been confronted with this crime 
commission report that had to do with the Guarantee Finance Co. 
Now what are we going to do ? 

Mr. Halley. Perhaps we can work this out right now, Sheriff, and 
get to the bottom of it. 

Sheriff Biscailuz. Yes. 

Mr. Halley. I believe you have taken the position that something 
went haywire ? 

Sheriff Biscailuz. Yes. 

Mr. Halley. Where did something go haywire ? 

Sheriff Biscailuz. Right there with Captain Pearson at that time, 
who has told me many times, with tears in his eyes — who has told me 
on several occasions it was not from a standpoint of trying not to do 
the right thing but it happened because he didn't have the men at the 
time. 

Mr. Halley. The crime commission report states : 

In spite of admissions of the principals of the company and the facts apparent 
from even a cursory examination, all of wliich were reported to Captain Pearson, 
Pearson said that this was not enough to establish that bookmaking was then 
being conducted at the place ; that he could do nothing to assist in searching 
the upstairs rooms. 

Sheriff Biscailuz. I read that in the report, I believe. 

Mr. Halley^. Do you know whether Pearson admits having been 
told those facts and having stated there was no evidence sufficient to 
enable the sheriff to assist ? 

Sheriff Biscailuz. I believe that Pearson himself felt tliere wasn't 
sufficient evidence for the sheriff to go into that particular building at 
the time, and that is why they were trying to get conspiracy com- 
plaints against them — they had been working, trying to get conspiracy 
complaints against them, and they did, by their surveillance and fol- 
lowing these different cars, I know they were able to make laiock overs 
in other parts of Los Angeles County. 

Mr. Halley. Did you give Pearson discretion to decide whether 
he would assist the crime commission or did you tell him to do it? 

Sheriff Biscailuz. I simply asked liim at the time. I didn't even 
consider it an order at the time because it was just the ordinary thing 
to do. I thought there would be no more to it and that Pearson would 
have had the two men or more down there to help out. 

Mr. Halley". Then Captain Pearson made a mistake; is that right? 

Sheriff' Biscailuz. Yes. 

The Chairman. Did lie tell you, when you passed on Mr. Eobinson's 
request, that he didn't think that there was anything to do or sufficient 
evidence to do anything about it? 

Sheriff Biscailuz. No; because that didn't come into it. Senator; 
that didn't have anything to do with that. 

The Chairman. Did you order him to send somebody down? 

Sheriff Biscailuz. I simply told him to give Mr. Robinson whatever 
assistance was necessary to carry out whatever Mr. Robinson intended 
to do. I think that is it. Senator. 



orga:s'ized crime in interstate commerce 291 

Tlie Chairman. Did 3-011 tell him that or write him that ? 

Sheriff Biscailuz. That was just by telephone. 

The Chairman. Did Mr. Peai-son call J<m back and say he wasn't 
•ioing to obey your orders? 

Sheriff Biscailuz. No. 

The Chairman. What did you do to Mr. Pearson ? Did you leave 
him on the job? 

The Chairman. Yes ; we kept him on the job because there was noth- 
inij.- that ever came to us that we could follow throuo:h from the stand- 
point of laxity, anything^ that came through that showed he was lax 
in his activities. 

Senator Tobet. Wasn't he transferred after that ? 

Sheriff Biscailuz. Yes ; but not right away. 

Senator Tobey. This is no personal reference to you or your deputy, 
but the question that we have in our minds, as we go to these places, is 
whether it is through the work of these enforcement bodies, whether 
they are following the line of least resistance or whether there is a 
mighty fervor on the part of the sheriff's office and the police depart- 
ment to go out and get these people. We wonder whether these law- 
enforcement officers say, "We are going to get you, you can be sure." 
We want to know whether they are anxious to get these criminals, 
tugging at the leash to bring them in, or whether they are not too 
interested in bringing criminals in. Are your men enthusiastic over 
the job? Do they see the gi-eat things they can do, or do they sit back 
and say, "We are part of the sheriff's establishment, so what?" 

Sheriff Biscailuz. As far as our department is concerned, it isn't 
100 percent any more than any other organization, but I know that 
our organization knows that they never have been told, as yet to ever 
go easy on anyone. I have never had them in, even at election time, 
to vote for so and so. They have been on their own. 

Now perhaps there are some in. the office who are overzealous and we 
may have men in our office who probably would like to coast. They 
get close to retirement ; and we have to watch all those things. As I 
say, we are not perfect ; but I do know I only wish we could have or- 
ganizations throughout the country that would think of things, I mean 
100 per cent like that, be a 100 percent organization. Everyone has 
their failings, even myself, who happens to be the head of this depart- 
ment. 

Mr. Halley. Now, Sheriff, in a,ddition to Pearson's mistake, were 
there any other incidents surrounding the raid which might have 
created at least a question in the minds of the people who wrote this re- 
port about your office ? 

Sheriff" Biscailuz. Not to my knowledge. 

Mr. Halley. Have you read this reports 

Sheriff Biscailuz. Yes, I did; but it has been some time ago, 

]Mr. Halley. Do you recall reading this portion, and let me read 
from the report : 

One deputy sheriff appeared late in the day, unaware that the corporation com- 
missioner's investigators were still present, and asked one of Kobey's employees, 
■'Has the smoke blown over yet ';'" 

Do you remember that? 

Sheriff' Biscailuz. I remember reading that. Then I checked on 
that, and it happens — I think that is the incident where we were selling 
tickets to our annual rodeo. This deputy was in there to sell tickets 



■292 ORGANIZED CRIME IN INTERSTATE COMMERCE 

to tliis organization, or whatever was in that building, and so forth. 
Whatever excitement came up at the time, he moved out and left there 
and then he came hack afterward and said, "Has the smoke blown 
away?" The story I had was that this fellow was one of the ticket 
sellers from the Firestone station, who wanted to sell some of his 
tickets to the rodeo, and that is why he was asking if the smoke had 
blown away. I am not sure and I wouldn't say positively whether that 
is what you are talking about here or not. 

The Chairman. That sounds like the first time he was in there 
and he saw they needed some help from the sheriff's office and then he 
ran out. He came back, after having done nothing about it, still trying 
to sell tickets in a place that had been raided. 

Sheriff Biscailuz. Well, I am not too sure, again, and I don't want 
to make any statement here that I can't back up. 

The Chairman. Did you investigate this fellow, this fellow who 
said, "Has the smoke cleared away?" 

Sheriff Biscailuz. Our office, his captain and all, gave him a bill 
of health by stating that this m.an was all right and that he was not 
one who had to be disciplined. 

The Chairman. Did you do anything about it yourself ? 

Sheriff Biscailuz. No; I didn't. 

The Chairman. Don't you think you ought to have ? 

Sheriff Biscailuz. If I had had the right information. 

The Chairman. You got this report a long time ago. Did you do 
anything about it then? 

Sheriff Biscailuz. No. I just checked and they said that this man 
was a good deputy sheriff. 

The Chairman. It doesn't sound like it. Did you do anything 
about it when you got this report ? 

Sheriff Biscailuz. No. 

The Chairman. The plain inference from this report is, apparently, 
you have done nothing to contradict it, and that is that he first went 
there and the thing was in a mess ; arrests were being made or should 
have been made, and he left the scene of action, not doil^g his duty or 
not doing anything to help. None of your people did anything to 
help. Also that he came back later still wanting to sell tickets to 
people who had been raided, and asked if the smoke had cleared as yet. 

Sheriff Biscahuz. That was the report of a deputy coming in there. 

The Chairman. Doesn't it sound pretty bad for a deputy ? 

Sheriff Biscailuz. It might; yes. 

The Chairman. Not only the fact of his selling tickets to a sheriff's 
benefit to a place that had been raided, but he wanted to know if the 
heat was off yet so he could sell his tickets. Doesn't that sound pretty 
bad to you ? 

Sheriff Biscailuz. It would if the circumstances were that way. 

The Chairman. Were they or were they not ? 

Sheriff Biscailuz. That is what I wasn't able to find out. 

The Chairman. Did you call the man in yourself ? 

Sheriff Biscah.uz. No. 

Mr. Halley. Captain Jewell yesterday stated that, while he thought 
selling tickets to benefits was fine, that he certainly didn't think a 
deputy sheriff should sell a ticket to a benefit to anybody who was 
under suspicion. Is that your view of the matter ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 293 

Sheriff Biscailuz. I don't think tickets should be sold for any 
worthy benefit to a place like that. He shouldn't go to those who were 
of that type of character, who would be expecting favors, because they 
had supported the sheriff's organization. I agree with you on that^ 

Mr. Halley. Is it not a fact that the Guaranty Finance officers were 
and had been for some months under very definite suspicion by your 
office and under investigation? 

Sheriff Biscailuz. Yes. 

Mr. Halley. So that it would appear that your deputy sheriff 
should not have been selling tickets there at all but should have been 
investigating this place at arm's length? 

Sheriff Biscailuz. He was a patrolman. Of course, I will say 
this, that every deputy sheriff in all of our substations are authorized 
now to be responsible. The captain, in other words, of each station is 
made responsible for vice in his particular area. Of course, I don't 
want to get off the subject, but I will say that anyone selling tickets ta 
one who was of a shady reputation should have better judgment, 
unless this man didn't have anything whatever to do with our organi- 
zation. But you can't cut it that fine. I will say the only way to do it 
is not sell tickets to people who want favors in return. 

Mr. Halley. The ticket seller was a deputy sheriff, was he not?. 

Sheriff Biscailuz. That is something I am not sure of. 

Mr. Halley. Didn't you investigate this report of the crime com- 
mission to find out who it was that did this thing ? 

Senator Wiley, Was this man on the regular payroll? Deputy 
sheriffs lots of times are those deputized for the occasion, or may be 
simply someone temporarily authorized. I wondered if he had any 
particular status in this organization. 

Sheriff Biscailuz. That is something right now I couldn't tell 
you, sir. 

The Chairman. Do you know who the deputy sheriff was? 

Slieriff Biscailuz. Not now, sir. 

Mr, Halley. In any event, would you say after he made his first 
appearance and founcl the place being investigated and raided, that 
it was bad judgment on his part to come back in later and try to sell" 
tickets? 

Sheriff Biscailuz, If this deputy sheriff knew that this place had 
been raided and it was a place that proved to be what it was, I would 
say then he should have been disciplined ancj suspended. 

]\Ir. Halley. Wouldn't the expression, "Has the smoke blown over 
yet?" indicate that his sympathy was on the side of the Guarantee 
Finance people rather than on the side of the people who were causing 
the smoke? 

Sheriff BiscAn.uz. That is a matter of opinion, sir. 

Mr, Halley. How do you interpret it, Sheriff? 

Sheriff Biscailuz. If it was a raid and if this place was, in the 
knowledge of the deputy, a place such as it was, then he had no reason 
for being in there, unless he was doing something to enforce the law. 

Mr, Halley, If he was in there and he said to the employees of the- 
place, "Has the smoke blown over yet?" do you interpret that as- 
showing his sympathy was on the part of the lawbreakers rather 
than on the part of the law-enforcement officers? 



294 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Sheriff Biscailuz, I would say, if lie had knowledge that it was a 
place where the law was being broken, then he was not caring very 
much about these people breaking the law. 

JNIr. Halley. The name of the deputy is Ralph Glavin, I have been 
so informed. Do you know if he was a regular ? 

Sheriff Biscailuz. I couldn't say ; I would have to check. 

Mr. Halley. There were certain other incidents that came to your 
attention, were there not ? 

Sheriff Biscailuz. What, for instance? 

Mr. Halley. Before we get to that, Mr. Eobinson points out that 
Glavin is now a detective sergeant. Did you know that? 

Sheriff Biscailuz. I know there is a Glavin who is a detective ser- 
geant. We have a lot of detective sergeants that work out in the 
field that do not come in contact — that I do not come in contact with, 
unless I happen to be in the distri<^t and meet them personally. 

Mr. Halley. This is Ralph Glavin at the Atlantic station. Wtis he 
a regular employee ? 

Sheriff Biscailuz. How would he be if he was that. 

Senator Tobey. He has a better job now than he had then. Is that 
a reward of merit? 

Mr. Halley. Now, Sheriff, how long prior to that raid was your 
office aware of the suspicions against the Guaranty Finance Co. ? 

Sheriff Biscailuz. As I said, much of that information is in this 
report here that was made. 

Mr. Halley. Several months, would you say, anyway ? 

Sheriff Biscailuz. Yes. 

Mr. Halley. On one occasion you were informed that a Lieutenant 
Fiske 

The Chairman. The report goes way back to 1946. 

Mr. Halley. The chairman points out that the report and the obser- 
vations go back to 1946. 

Sheriff Biscailuz. I didn't have any knowledge of it in 1946. My 
knowledge of it came about 1948 or 1949 ; personal knowledge. 

Mr. Halley. Did it come to your attention on one occasion that a 
Lieutenant Fiske of the police department actually went outside of 
the city limits and raided the Guaranty Finance offices, by going 
through a skylight and getting into the premises? 

Sheriff Biscailuz. I was told that he had ; yes. 

Mr. Halley. Did yon attempt to take any action on the basis of his 
raid ? 

Sheriff Biscailuz. No. 

Mr. Halley. Then on a second occasion Lieutenant Fiske did the 
same thing, did he not, raided the place again ? 

Sheriff Biscailuz. I am not sure about that. I know that Fiske 
came into the picture on occasions. 

Mr. Halley. Isn't it a fact that a letter was written by Capt. Al 
Guasti of your office, complaining about this police officer going out- 
side of his jurisdiction? 

Sheriff Biscailuz. I have never seen that letter and I have had 
denial after denial from Guasti himself. I have never seen that letter 
and cannot find that there had ever been such a letter. 

Mr. Halley. Have you spoken to Assistant Chief of Police Joseph 
Reed, who stated in this report that he had received such a letter ? 



ORGANIZED CRIME. IN INTERSTATE COMMERCE 295 

Sheriff Biscailuz. I liave not, no. 

]Mr. Halley. As far as you know no complaint was made asking 
that Lieutenant Fiske be ordered to refrain or to stop his investigations 
into the county ? 

Sheriff Bisgatluz. Not to my best knowledge. 

Mr. Halley. Did other complaints come to you about the Guarantee 
Finance Co. ? 

Sheriff Biscailuz. No. 

Mr. Halt.ey. Do you recall having received complaints from the 
telephone company? 

Sheriff Biscvvilijz. Not directly. I think those have gone right to 
our vice squad. I don't remember directly receiving any complaints. 

Mr. Hai.ley. Did you receive a letter directly from the crime 
commission ? 

Sheriff' Biscailuz. In August, was it ? 

Mr. Halley. In August of 1948. 

Sheriff BiscAiiiUz. That I would have to refresh my memory on. 

Mr. Halley. It states in their report : 

In August of 1948. reports coming to the attention of this commission con- 
firmed the extent of the boolimaking activities of the Florence Avenue address, 
information parallel to that received from the Los Angeles Police Department 
many months prior. 

The letter was addressed by the commission to the sheriff's office that 
month directing attention to these activities and forwarding copies 
of anonymous conmninications which had been received by the com- 
mission concerning the nature of the finance company's business. Did 
you personally see those ? 

Sheriff Biscailuz. Not to my knowledge. I don't remember, but 
they could have been received and gone directly over to the vice 
squad, unless they were addressed personally to me. 

Mr, Halley. The commission's report goes on to say : 

That the sheriff's office subsequently responded that the activities at the 
Florence Avenue address were contined to distributing scratch sheets and other 
accessories used in bookmaking and there appeared to be no violation of law 
upon which action could be initiated. 

That would indicate no action was taken? 

Sheriff Biscailuz, According to that letter, as to that particular 
function. 

iVIr. Halley. In addition to the crime commission advising your 
office and in addition to the raid made by Lieutenant Fiske, did you 
not get in your office a series of complaints by the telephone company? 

Sheriff Biscailuz. Not directly. 

Mr. Halley. But they went to your office? 

Sheriff Biscailuz. Again they would go to the vice squad, unless 
personally directed to me. 

Mr. HALiiEY. They would go to Captain Pearson ? 

Sheriff Biscailuz. If he were in charge of that at that time; yes. 

Mr. Halley. There is one thing in the report which states about a 
location on Whittier Boulevard, as follows — this is a letter from the 
phone company to your office: 

This location is next door to our public office on Whittier Boulevard. It was 
reported on December 17, 1947, when Mr. Bragg had a single line. It was 
reported again when the service was changed to a rotary. Installer stated 
definitely bookmaking. Manager feels it is not helping our public relations in 



296 ORGANIZED CRIME IN INTERSTATE COMMERCE 

that district to have a bookie next door to an office where we take applications 
for service. Too many people who cannot get a telephone call attention to the 
fact that bookies can get telephones and why can't we? 

It states that it was given to Captain Pearson on November 19 at 
approximately 9 : 15 a. m. 

Now, with such specific information from the telephone company, 
from the police department of Los Angeles, and, at least, some infor- 
mation from the California Crime Commission, can you explain how 
it is possible that your office couldn't obtain the evidence to con- 
vict the Guarantee Finance Co. ? 

Sheriff Biscailuz. Do you have the follow-up on that? What 
action was taken ? Does it say whether Pearson did make a knock- 
over or what? I have no way of knowing now what he did at the 
time with that information. 

Mr. Halley. The company did continue in business, did it not? 
I am not referring so much at this point to the specific bookie ; I am 
talking of the entire operation. 

Sheriff Biscailuz. I couldn't answer that without checking the files 
and seeing what Captain Pearson did at the time or what was done. 

Mr. Halley. Wouldn't Captain Pearson be accumulating enough 
information, or shouldn't he have accumulated enough information 
to enable him to go ahead and do something about this bookmaki ng 
operation at the Guarantee Finance Co. ? 

Sheriff Biscailuz. He is a fellow, as I know from past dealings 
with him, who is very thorough in his work and knocks places over 
whenever he had the evidence to do it. 

Mr. Halley. Doesn't it strike you that in this particular case, 
whereas you say he made the mistake of refusing to assist in the raid, 
and where he had this information brought to his attention, that there 
may be some justification for the feeling you referred to earlier in your 
testimony among some people, that it is easier to operate in the county 
than it is to operate in the city ? 

Sheriff Biscailuz. I would never say it was easier to operate in one 
place over another. Tliat is an assumption and it is not fair to the 
jurisdiction that might be involved in it. It is all a matter of cir- 
cumstances. 

Mr. Halley. Are the circumstances here such as to indicate that 
the sheriff's office vigorously attempted to prosecute this Guarantee 
Finance Co.? 

Sheriff Biscailuz. All I can say is, from the reports he gave me, 
and he is still available himself for interrogation, personally. 

Mr. Halley. The crime commission and the corporation commis- 
sioner's office, their raid resulted in convictions of eight individuals, 
did it not ? 

Sheriff Biscailuz. That is right. 

Mr. Halley. The bookmaking operation turned out to be a very 
large one, I think aggregating something like $7,000,000 a year. 

Sheriff Biscailuz. I don't know how much, but it was considerable. 

Mr. Halley. Do you think that your office acted vigorously in this 
matter, as compared to the Crime Commission and the Corporation 
Commissioner's office? 

Sheriff Biscailuz. I have already said, in not assisting at the time 
that Mr. Robinson asked for that assistance — well, I wouldn't call it 
a mistake. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 297" 

Senator Tobey. Does your office feel a deep sense of humiliation 
that this thing was uncovered in your bailiwick by people outside 
of your bailiwick 'i Don't they feel a deep sense of humiliation that 
this could happen right under your nose ? 

Sheriff Biscailuz. Nobody likes to have anything happen in their 
jurisdiction, Senator. 

Senator Tobey. Now, I am simply asking, and it isn't in an un- 
kind way, did you then follow through and try to find out what was 
wrong and, what was the matter with the morale of your department, 
that they were not on their toes ? 

Sheriff Biscailuz. This man here, Pearson, mentions there in the 
report about the conspiracy complaints at the time they were working 
on. In other words, the knock-over by the corporation commissioner 
prevented him, as he says, from getting his conspiracy complaint. 
That is something he will have to answer, of course. 

The Chairman. The thing is: Did you call in Pearson and say, 
"Why didn't you do something about this yourself?" Did you put 
him on the carpet, so to speak ? 

Sheriff Biscailuz. I did ; yes. That is what I say. I told him ab- 
solutely that I felt that he should have utilized every means to have 
gotten the men for Mr. Robinson. They were out at the time and,, 
as I say, it was something that should not have been allowed to happen. 

Senator Tobey. What did you really do? What you really did 
was just slap his wrist. 

Sheriff Biscailuz. Not necessarily. 

Senator Tobey. What else did you do ? 

Sheriff Biscailuz. We dressed him down quite a little, sir. 

Senator Tobey. Does he bear any scars ? 

Sheriff Biscailuz. No. 

Senator Tobey. Did he lose any money ? 

Sheriff Biscailuz. No. 

Senator Tobey. Did he suffer any time off? 

Sheriff Biscailuz. No. 

Senator Tobey. Did he suffer any loss whatsoever because of his 
bad behavior? 

Sheriff Biscailuz. No; because, again, those things can happen 
in any organization. We are a large organization. It is one of those 
things that we are sorry happened as it did. The knock-over was made 
and it wasn't like losing a murder case because, at least, the knock- 
over was made. 

Mr. Halley. Do you know whether a man named Hymie Miller 
conducted a bookmaking operation in Culver City ? 

Sheriff Biscailuz. I know a Hymie Miller that has been a book- 
maker for a long time. He has a reputation. There was a knock- 
over made in Culver City just 3 or 4 months ago. 

Mr. Halley. Do you know if that was made by your office or the 
Culver City police? 

Sheriff Biscailuz. I am not sure ; it could have been made by either 
of them, and we could have assisted if we were asked to come in. It 
should liave been made by the chief of police of Culver City or his 
department. 

Mr. Halley. In a situation where you know a man such as Hymie 
Miller has been operating as a bookmaker for a long time, do you try 
to keep tabs on him and survey his activities ? 

68958— 51— pt. 10 20 



298 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Sheriff Biscailuz, You mean our office and the men in our office 
that have that duty to perform? 

Mr. Halley. Of course that is what I mean. 

Sheriff Biscailuz. Yes. 

Senator Tobey. I think Hymie Miller just left this room about 
10 minutes ago. I didn't see anybody tailing him. 

Sheritr Biscailuz. Some of these questions are hard questions to 
answer. I can answer for a lot of things, gentlemen, but take, for 
instance, this building that we are in, this is Federal property, and 
that happens to be in the city of Los Angeles, too, and we are held 
accountable for enough things without taking in more territory that 
weshould be blamed for like Culver City. 

Mr. Halley. What I am trying to ascertain is whether an operation 
like that of Miller's would be something that would result in your 
office bringing about the arrest or whether it was accomplished inde- 
pendently of your office. 

Sheriff' Biscailuz. Here is what happens. There isn't a month that 
goes by that our office does not assist a small police department in the 
county in knocking over bookies. We have a record a mile long that 
we can show you where we have done that. We can show you, where 
the force in that locality is inadequate to do the work that they should 
do, that they call upon us. I would like to explain this here, also, 
that at the present time the district attorney's office and the sheriff's 
office have a combined squad that has been in operation for about 2 
months now. We called all the chiefs of police of Los Angeles County 
into a meeting, I mean the board of supervisors did, which resulted in 
where the district attorney and I both told them of our new plan; 
that was to combine our vice squads, and that we wanted their help 
and cooperation in every way. If that wasn't forthcoming, then we 
were going to forget these jurisdictional lines and go in ourselves and 
make knock overs in any city of the county, as well as the unincorpo- 
rated areas. We have a very fine record on that now, since we have 
had this combined thing. 

At the same time I issued orders to every one of our captains in 
the stations and made it their duty — that didn't used to be considered 
good police work for uniformed men to handle vice; they were sup- 
posed to handle their own work and call in at any time that there 
was a place that may be running a bookie place or gambling place, and 
they would just call that information in — that was customary for 
years. 

The Chairman. We have heard testimony about this combined 
squad. I think it is a very good idea. You have a large county with 
unincorporated and incorporated sections, and to have a combined 
group working together and exchanging information is a splendid 
idea. But the question is. How come this wasn't put into effect a long 
time ago? 

Sheriff Biscailuz. All I can say is that it is just like anything else 
that comes along. 

The Chairman. What happened 2 months ago that got this started ? 

Sheriff Biscailuz. The district attorney and I got together and 
started talking about the proposition of just trying to do something 
more effective than we had done in the past. I know it was a fine 
idea, and I know, as the district attorney told these people, it was 



ORGANIZED CRIME IN INTERSTATE COMMERCE 299 

for keeps and it wasn't just an idle gesture to last 3 or 4 months and 
then to separate the squads again. 

Senator Tobey. Do you have your own homicide squad? 
Sheriff Biscailuz. We don't call it homicide squad any more, but 
it is part of our detective bureau, sir. 

Mr. Halley. Would you say that since the raid on the Guaranty 
Finance that law enforcement in the county has tightened up some- 
what? 

Sheriff Biscailuz. I think law enforcement, regardless of the Guar- 
anty Finance, to a great extent has tightened up. I really believe 
there is more effective law enforcement now than in other times. I 
don't believe, sir, that there are many people that don't want to do 
a good job in law enforcement. There are a lot of things sometimes 
that prevent better law enforcement than at other times, but we are 
striving at all times, at least we learn every day by the mistakes that 
we made ^^esterday, and trying to profit by that. 

Mr. Halley. Until about a year or a year and a half ago, did cer- 
tain gambling operations operate in the county ? 

Sheriff Biscailuz. Certainly there has been gambling; yes. As I 
say, I will never be able to eradicate gambling or prostitution or book- 
making in any place entirely, whether it is in a city or in the county 
of Los Angeles or where it may be. There will always be such an 
animal, but at the same time I will assure you that everything is being 
done to obliterate, if possible, that type of business, but you never 
will, as long as there is a. human being alive on two feet, find that 
there is going to be a city or a county in the entire United States of 
America that is going to be free from gambling and bookmaking. The 
thing depends to some extent how we can minimize it; that would be 
the job of our office, the office itself and the men in it, to sincerely tiy 
to minimize that type of thing as mucn as we caiL 

Mr. Halley. Do you keep advised of the apparent means of your 
deputies, whether any of them have a manner of living that might 
appear to be in excess of that justified by their salaries ? 

Sheriff Biscailuz. Well, we have a captain of personnel that 
handles everything that has to do with the matter of the personnel 
of the deputies. I know" well enough that if I would notice one of 
our deputies riding around in a Cadillac, and things of that sort, 
that I would begin to find out whether someone left him a Cadillac 
or whether he was heir to a fortune of some kind or other, I don't 
think you will find, in our office or any other office, very many men 
in police work that are doing any more than having a hard time 
getting along. 

Mr. Halley. You do not have any wealthy deputies ? 
Sheriff Biscailuz. I wouldn't say that; I don't know. If there 
are any wealthy deputies, they have kept it quiet. 

Mr. Halley. Do you remember at the time that publicity was given 
to certain microphone recordings at Mickey Cohen's residence, that 
there was some reference to a Guasti owning a piece of a gambling 
place at Burbank? 

Sheriff Biscailuz. It was rumored around ; I heard that ; yes. 
Mr. Halley. Did you state to the press at that time that it was 
some other Guasti, other than the Guasti wdth your department? 

Sheriff Biscailuz. I never made such a statement to the press or 
anybody else, because I wouldn't know what Guasti it was. There 



300 ORGANIZED CRIME. IN INTERSTATE COMMERCE 

is a Guasti family here that are very respected and have been in 
the winery business for generations, so I wouldn't make any such 
statement that it was some other Guasti or anybody else, because- 
I didn't know and still don't know. 

Mr. Hallet. I presume you. checked with your Captain Guasti and 
received a denial from him. 

Sheriff Biscatluz. Naturally; anything that comes up on this case 
or anything like that — I don't remember about that particular thing, 
though — but we do know from information that comes to us, and we 
certainly check to see whether, at least to the extent of getting a 
denial, we at least try to get that if we can't get anything further. 

Mr. Halley. You don't recall having made a personal check about 
your Captain Guasti as to this situation ? 

Sheriff Biscailuz. No. 

Mr. Halley. I have no further questions. 

The Chairman. Any further questions ? 

Mr. Halley. Let me ask just a few more questions. 

Do you know whether any of your deputies had obtained loans from 
the Guarantee Finance Co. ? 

Sheriff Biscailuz. I heard that rumored either in that report or in 
the press that there had been loans made to deputy sheriffs and police 
officers from the Guarantee Finance. 

Mr. Halley. Did you make any effort to check on that ? 

Sheriff Biscailuz. That only got to the rumor stage, and another 
thing, the Guarantee Finance at one time, at least, had a cloak of re- 
spectability, the way I have been told. The time I did check on it,, 
at first it could have very possibly been not only for deputy sheriffs 
but people in the business world who did borrow money from the 
Guarantee Finance, thinking it was a legitimate firm. 

Mr. Halley. Did you make no effort to ascertain the facts with 
reference to the particular charges ? 

Sheriff Biscailuz. There had been no charges. 

Mr. Halley. You say you had heard rumors? 

Sheriff Biscailuz. We hear rumors every day about anything. 

Mr. Halley. Did you make any attempt to find the source of the 
rumor? 

Sheriff Biscailuz. No ; there are too many around Los Angeles. 

Mr. Halley. You never made any effort to check this particular 
rumor ? 

Sheriff Biscailuz. But I did find, from the standpoint of our office, 
that w^e were free and clear from any borrowing, the borrowing of 
any money there, as far as the information I received. 

Mr. Halley. Did you check with the individual deputies? 

Sheriff Biscailuz. The deputies named didn't come to me. I don't 
even know who the deputies are or if they borrowed money there or 
not. The rumor simply said deputy sheriffs had been accused of 
borrowing. 

Mr. Halley. Did you ask the people who had possession of the books 
to advise you if any deputies had made loans? 

Sheriff Biscailuz. No. It was just the rumor stage. It never went 
any further than that. 

The Chairman. Who had the books ? 

Mr. Robinson. I had the books. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 301 

Mr. Halley. You didn't asli liim if any deputies made loans? 

Sheriff Biscailuz. No, I didn't. 

The Chairman. Is that in the California Crime Commission report? 

Mr. Robinson. I think there was reference in there to it; wasn't 
there ? I don't really remember. 

The Chairman. I think I read it in the report yesterday. If they 
made loans thinking it was a legitimate concern, there wouldn't 
be necessarily an}' blame connected with it, but over a period of about 
3 years before it was raided, it was well known in the sheriff's office 
that the thing was under investigation and that it was thought that, 
while it had a legitimate front, it was actually a bookmaking activity. 
So that most of your people would have known or had a suspicion 
about the organization, wouldn't they? 

Sheriff Biscailuz. Yes; but, on the other hand, I have not heard 
the names of any men in our organization that borrowed from this 
outfit. 

The Chairman. The point is, Wlien an accusation like that is made, 
or even a rumor, don't you think there is some obligation on your 
part to find out what the situation is? You shouldn't have to sit 
t)ack and wait until the evidence is presented to you. It seems to me 
you should be on the initiative to ascertain the facts about it. Now, 
I am not impugning your motives. I want to say frankly you look 
like a good, honest man to me. We are only asking questions about 
whether there might have been some things in this connection that 
jou should have done that you didn't do. 

Sheriff Biscailuz. There is no doubt in my mind and there isn't 
■one of us sitting here or anywhere else that from time to time may 
neglect to do certain things that maybe they should have done. I 
am not infallible, but usually I do know pretty well what kind of an 
organization I have, but I don't remember anything coming out ex- 
cepting in the papers about loans having been allegedly made. To 
answer your question, I did not find and did not investigate whether 
any loan had been made to any of our men. 

Mr, Halley, According to the crime commission report, loans were 
made to deputy sheriffs and to police officers of the Los Angeles Police 
Department, and then the report goes on to ssij that the police de- 
partment investigated all of its officers whose names appeared in the 
Guaranty Finance records. Of course, the question was whether you 
took a similar precaution. 

Sheriff Biscailuz. You can ask that question again and again. I 
am assuming the responsibility; whether it was done by one of our 
captains or not, I don't know, but I am assuming the responsibility. 
It might have been done in our office when that thing came up. At 
the same time I would not say that an investigation had been made. 

The Chairman. Is someone named Hills, a Jean Hills, a secretary 
in your office ? 

Sheriff Biscailuz. I don't know that name. 

The Chairman. Was some letter written to tell this fellow Fiske to 
stay out of the county and not come around messing things up in the 
^county ? 

Sheriff Biscailuz. That question was asked. 

The Chairman. You don't know about it ? 



302 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Sheriff Biscailuz. I never heard of the letter, and received a denial 
from the man who is accused of having written the letter, and he 
said he never had written such a letter. 

The Chairman. Was any order issued for captains in the precmcts 
around the Strip to not close up some of those places out there? 

Sherilf Biscailuz. I want to say to you, Senator, right now, that as 
long as I have been in that office 

The Chairman. I am not talking about you. 

Sheriff Biscailuz. Then nobody else would have a right to issue 
such a letter. If they did and it came to my attention, absolutely, 
action would be taken because they would have no right and the 
policy of the office is not to show favoritism to any group or to any 
outfit. 

The Chairman. A good many places did operate on the Strip, 
gambling places, years ago while you have been sheriff? 

Sheriff' Biscailuz. Yes; I remember from time to time they did, 
but we knocked them over, too. They would go from place to place. 
We found them and harassed them. 

The Chairman. Is there a community called Gardena in the county ? 

Sheriff Biscailuz. They have draw poker there, and that is one of 
the places where we have this squad of ours going out there every 
night. They have an ordinance where they can have poker clubs and 
where they play poker. 

The Chairman. Has that been ruled illegal by the State? 

Sheriff Biscailuz. No, sir. 

The Chairman. So this draw poker is still legal? 

Sheriff Biscailuz. And they are still running full blast. 

The Chairman. On the theory that it is a game of chance ? 

Sheriff Biscailuz. And an ordinance voted in the community by 
the people themselves. 

The Chairman. I thought under Attorney General Howser's rule, 
he ruled it legal but that his opinion had been reversed. 

Sheriff Biscailuz. They are still going on, I know that. There 
has been no attempt to close them from a legal standpoint. 

Mr. Robinson. Was there an occasion. Sheriff, when Mickey Cohen 
asked that a bodyguard be assigned to him by your office ? 

Sheriff Biscailuz. Yes. 

Mr. Robinson. Did you comply with that ? 

Sheriff Biscailuz. No. 

Mr. Robinson. Did the attorney general ? 

Sheriff Biscailuz. I think they had a bodyguard for him. 

Mr. Robinson. The attorney general's office did? 

Sheriff Biscailuz. Yes. 

Mr. Robinson. That was Harry Cooper ; is that right ? 

Sheriff Biscailuz. Yes. 

Mr. Robinson. Were you asked to refrain from moving on Mickey 
Cohen during the time that bodyguard was with Mickey ? 

Sheriff Biscailuz. Let me get this straight now. That was before 
the shooting or after ? 

Mr. Robinson. Before tlie shooting. 

Slieriff Biscailuz. Before the shooting, there was some work being 
done, that is right, and we had been asked that we refrain, I mean, not 
follow him around, that it might spoil the job that was being done or 
attempting to be done. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 303 

The Chairman. That you not make any investigation of Mickey 
Cohen while they had this bodyguard with him? 

Sheriff Biscailuz. I don't really know. 

The Chairiman. Was that the request? 

Sheriff Biscailuz. Repeat that, if you will. 

The Chairman. Mickey Cohen or someone applied to you for a 
bodyg^uard and you didn't assi^^n him one, but the Attorney General, 
Howser, assijrned him a bodyguard; is that correct? 

Sheriff Biscailuz. This man Cooper, whether you call him a body- 
guard or not, I don't know, but he was with him. 

The Chairman. The request was made of you that you make no 
investigation of Mickey Cohen as long as the bodyguard was assigned 
to him ? 

Sheriff' Biscailuz. Well, I don't know about the word "investiga- 
tion," but not to harass him at that time. 

The Chairman. What was the idea of that ? 

Sheriff Biscailuz. I don't know. In law enforcement you have 
different branches and they may be woi-king on sometliing, and we 
always try to coo]:)erate together. We would naturally listen to a 
request like that. Like the Los Angeles Police Department w^ould ask 
us in particular case to help them more by not doing this, that, or the 
other thing. It is possible that those things could have been done, 
but I do i-emember that the request was made for us not to follow, 
you might say, too closely. 

The Chairman. Did you stop your investigation of him? 

Sheriff Biscailuz. No. 

The Chairman. Did they ask you, Sheriff, about the operations 
of Brophy since wire service went out of the State ? By the way, do 
you know this fellow Brophy ? 

Sheriff Biscailuz. I know of liinu I met him many years ago. 

The Chairman. Does he still have a place in Los Angeles County? 

Sheriff' Biscailuz. I don't know, sir. 

The Chairman. It is alleged he attempts to furnish bookie infor- 
mation bv getting it from the radio. Do you know if that is true or 
not? 

Sheriff' Biscailuz. No, I do not. 

The Chairman. Mr. Brophy testified before the Interstate Com- 
merce Committee of the Senate, that while the Continental went 
througli the State of California there weren't any outlets in the State 
of California, that he was operating or attempting to operate and give 
bookie information from the tracks and from Tiajuana by short-wave 
radio, and that he had an operation and was continuing his operation 
in Los Angeles County. 

Sheriff Biscailuz. It has not come to my attention. It might have 
to our office but not to my attention. 

The Chairman. Do you know anything about the operation of 
Brophy at all ? 

Sheriff Biscailuz. Just by reputation. I think he was in a lawsuit 
on the wire service some years ago. I can't quote what happened 
there, but, at least, it went up either to the district court of appeals or 
to the Supreme Court. There was a decision on that ; you can proba- 
bly get it or perhaps you remember it. I can't recall or remember the 
phraseology but at least it went up. 



"304 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Robinson. That was the case of Brophy v. The State of CaU- 
fornia. 

The Chairman. Brophy is Mr. Ragen's son-in-law? 

Sheriff Biscailuz. That is what I understand. 

The Chairman. Anything else, gentlemen. 

Senator Wiley. No questions. 

Senator Tobey. Nothing further. 

The Chairman. It is not our province, Sheriff, to tell people what 
to do. We are only interested in interstate operations. If we find 
there has not been a vigorous prosecution of interstate operations we 
try to find out why. If there is any political interference or law- 
enforcement interference, we try to find out about that too. 

Now, you appear to be a respectable and honest and a well-meaning 
man. The complaint about the Guarantee Finance Co. is one of inter- 
state operations that we would have something to say about, and that 
seemed to be that you assigned the matter to other people and did not 
pay very much attention to it yourself and that they didn't do a very 
good job in, first, ascertaining what this operation was ; it was fairly 
open and notorious over quite a period of time. In the second place, 
when somebody else came in to assist them and to really take the ball 
in doing what they should have done a long time ago, tliey didn't even 
assist them in their operation. So what the committee said about the 
general office of the sheriff in connection with the Guarantee Finance 
Co., while making no personal implication to you or your integrity or 
your good will about the matter, it would still be the opinion of the 
committee, as stated previously, on the Guarantee Finance Co. matter. 

We know that you are sorry about it. We admit that everybody 
makes mistakes, and I suppose the Senate and the members of this 
committee make as many as anyone else. 

Sheriff Biscailuz. Yes, we all do. 

The Chairman. The committee will stand in recess until 9 : 30 
o'clock tomorrow morning. We will endeavor to finish by 1 o'clock. 

(Whereupon, at 6 p. m., November 17, 1950, the committee recessed, 
to reconvene Saturday, November 18, 1950, at 9 : 30 a. m.) 



INVESTIGATION OF ORGANIZED CEIME IN INTEESTATE 

COMMEECE 



SATURDAY, NOVEMBER 18, 1950 

United States Senate, 
Special Committee To Ix\t:stigate 
Organized Crime in Interstate Commerce, 

Los Angeles^ Calif. 

executi\te session 

The committee met, pursuant to call of the chairman, at 9 : 45 a. m., 
in the Federal Building, Los Angeles, Calif., Senator Estes Kefauver 
(chairman) presiding. 

Present : Senators Kefauver, Tobey, and Wiley. 

Also present : Rudolph Halley, chief counsel ; Harold G. Robinson, 
associate counsel and chief investigator ; William G. Ruymann, special 
counsel to the committee; Herbert Van Brunt, special representative 
to the committee; and Julius Calm, administrative assistant to Senator 
Alexander Wiley. 

The Chairman. The committee will come to order. 

TESTIMONY OF W. L. BUET, TAX CONSULTANT, LONG BEACH, CALIF. 

The Chairman. Mr. Burt, do you solemnly swear that the testimony 
you will give this committee will be the truth, the whole truth, and 
notliing but the truth, so help you God? 

Mr. Burt. I do. 

The Chairman. Mr. Burt, are you a lawyer at Long Beach? 

Mr. Burt. No ; I am a tax consultant. I practiced law in Arkansas. 

The Chairman. But you are a tax consultant in Long Beach? 

Mr. Burt. Yes, sir. 

The Chairman. Is that a part of Los Angeles County ? 

Mr. Burt. Yes, sir. 

The CiiAiRiMAN. Is Long Beach an incorporated city ? 

Mr. Burt. Incorporated city ; yes, sir. 

The Chairman. It is south of Los Angeles ? 

Mr. Burt. South of Los Angeles, on the ocean. 

The Chairiman. You prepare tax returns for a number of gamblers 
in Long Beach, bookmakers? 

Mr. Burt. A small number. 

The Chairman. How about Dick Rains? 

Mr. Burt. I never prepared his income tax. I have given informa- 
tion to the tax — he runs the Garden of Allah- — and I have given him 
information on how to take out the withholding tax and social-security 
tax. 

305 



306 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. That is a gambling operation? 

Mr. Burt. No ; the Garden of Allah is a large restaurant and bar. 

The Chairman. Doesn't Rains operate a gambling operation ? 

Mr. Burt. That is the rumor. I couldn't say. I don't gamble, so 
I have never been in there. 

The Chairman. Warren Sutter, is he one of them, too ? 

Mr. Burt. Now, I know AVarren Sutter. 

The Chairman. What gambling places or what gamblers do you 
prepare the income tax for ? 

Mr. Burt. The reason I know they are gamblers, when they come 
in and I prepare their income tax, though, I put it down as bookmak- 
ing and gambling. Joe Irvine prepared theirs — I prepared his. A 
fellow by the name of Castello and Max Travis. 

The Chairman. On some occasions have you helped them get tele- 
phone service ? 

Mr. Burt. I have ; yes, sir. 

The Chairman. Tell about that. 

Mr. Burt. Well, over at Seal Beach Mr. Rains there, for the Garden 
of Allah, tells me he wants some phones and I assisted him as much as 
I could in getting the phones, and also Travis, the contractoi*s. Of 
course, those fellows that gambles, they have other ways too, and I 
helped him secure some phones. 

The Chairman. But you helped them secure phones for their book- 
making operations or their gambling establishments ? 

Mr. Burt, They came to me. It is business. I go up to the phone 
office with them. 

The Chairman. They have got quite a number of ]:>hones? 

Mr. Burt. Let's see, Travis only has one over at Los Alamitos. I 
don't know just how many Dick Rains has. 

Senator Tobey. What were your particular influences to get tele- 
phones ? 

Mr. Burt. None at all. Just tell them they would have to go up 
and sign for them and that — I have no influence with the telephone 
company. I just simply know how to get up the papers, tax papers, 
and so forth. 

The Chairman. What is this thing here, this photostat ? 

Mr. Burt. That was a place that Mr. Lee Miller, a building that 
he had the lease. Now, he had all this to lease and drawed a diagranr. 
of it here. I was in Olson's office at the time, and Travis leased this 
particular part of the building from him. And this here was a beauty 
shop. This was merely^ — he wanted to lease all this. He wanted to 
lease all of it, get it leased out so he drawed a diagram there [indi- 
cating]. 

The Chairman. Wasn't part of that a gambling operation or a 
bookie operation ? 

Mr. Burt. This is where the contractors were supposed to be. 

The Chairman. That is a front for a bookmaking operation, isn't 
it? 

Mr. Burt. Travis is a bookmaker. I don't know anything about 
White. 

The Chairman. Is it pretty well known that these places were 
operating in Long Beach, generally? 

Mr. Burt. Well, I will tell you, just to say this, that as far as Long 
Beach gambling is concerned there is no secret of it, as I see it. I think 



ORGANIZED CRIME IN INTERSTATE COMMERCE 307 

the policemen would have to be dumb and blind to not know that there 
is bookmaking going on. 

The Chairman. It is operating wide open now, isn't it? 

Mr. Burt. It is the same as it has been. I don't know there is any 
secret about it. 

The Chairman. Anybody can go into these places and make a book? 

Mr. Burt. Yes. 

The Chairman. Who is this man that testified or swore that he paid 
off Howser? 

Mr. Burt. Here is the way it was. That is a well-known fact down 
there among everybody. A fellow by the name of Malloy — and when 
Fred Houser is running for attorney general first, as I told you there, 
the only way I know Fred Houser is that he was assistant prosecutor 
there. I simply know him. 

The American Legion around the different lodges, or something like 
that. When he was running for attorney general they were making 
up a lot of money for him, I understood. This fellow Malloy was one 
of the collectors that went out and collected from Tom, Dick, and 
Harry; other people was running Houser's campaign. And Malloy 
made an affidavit or something that Joe Irvine, over at Brady's place, 
gave him $1,200 to take up to Houser, which he done. 

Senator Wiley. That is for a campaign fund? 

Mr. Burt. That is just a rumor. I don't know anything about. 
Anybody can tell yon as much as I could tell you because everybody 
could tell you about that. 

The Chairman. He testified to that in an open hearing. Joe Irvine 
is a bookmaker? 

Mr. Burt. Joe Irvine is a bookmaker and makes out on his returns 
that way. 

The Chairman. You make out his returns ? 

Mr. Burt. Yes, sir. 

The Chairman. Is he a big bookmaker? 

Mr. Burt. I wouldn't say Joe is such a big bookmaker ; no. Joe has 
other interests. Joe has quite a little real estate around town. He 
owns the Broadway Bar. 

The Chairman. Is he a well-known bookmaker or gambler in Long 
Beach ? 

Mr. Burt. Yes, sir; he is. He owned the Broadway Bar at one 
time. 

The Chairman. What is the general information relative to how 
these places operate without the police doing something about it? 

Mr. Burt. As I say, as I told you, Senator, I am well acquainted 
with most of the high police authorities there in Long Beach in just 
a passing wnj, knowing them, but as far as me knowing anything that 
they have any connection with the bookmakers, I don't, because I 
have no connections with the })olice department of any kind whatever. 

Mr. Robinson. Your chief of police was recently appointed? 

Mr. Burt. Yes, a man by the name of Dovey. 

Mr. Robinson. He was formerly city manager of Vallejo? 

Mr. Burt. No; Dovey has been in the police department for, I 
believe, about 23 years down there and had been trying to get to be 
chief for a number of years, and then when this last man went out 
they made him chief. 



308 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. EoBiNSON. Was Walter Lentz the former chief of police in-. 
Long Beach? 

Mr. Burt. That is right. 

Mr. RoBiNSOx. He was then chief investigator for the attorney 
general ? 

Mr. Burt. For the attorney general's office at that time, and he was. 
indicted over this — indicted not over this same proposition but I 
guess Malloy was over there testifying. 

Senator Tobey. Is Houser the attorney general ? 

Mr. Robinson. The chief aide was Walter Lentz. 

Senator Wiley. What was he indicted for ? 

Mr. Robinson. Tampering with a Federal witness. 

The Chairman. Here, apparently, you paid the telephone conir 
pany $100 for Travis and White ? 

Mr. Burt. Yes, this $100 was $100 that they had to put up. 

Senator Wiley. What is the date of it? 

Mr. Burt. This is November 2, 1949. That is when this phone 
was put in there at this particular place here, where there was 
going to be this contracting business. In putting phones outside of — 
especially outside of the city limits of Long Beach, where they are 
more expensive, lots of times the telephone company requires $100 
deposit, of which the man deposits and they pay 6 percent on that 
money at the end of the year. If the man has kept his bills up 
promptly, this $100 is refunded to him together with the 6 percent 
interest, making $106. 

The Chairman. Who is Captain Burt? 

Mr. Burt. I am Burt. I am W. L. Burt. 

The Chairman. What is this about? [Document handed to wit- 
ness.] 

Mr. Burt (reading) : 

Captain Burt, Ed Kammerer got this thing straightened out this morning:. 
Back in his name. We will straighten out when you — 

Well, I will tell you what this was. Ed Kammerer is a real estate 
man — had an office where I office. Now, he had a telephone out on 
Cherry Avenue, and he wanted to turn it over to another man, so I 
told the fellow, I said, "Well, the thing for you to do is just go over 
there and sign up for it." So he did, but then the telephone company 
called up and said that Kammerer would have to come up there andi 
sign off and this man sign on. 

So that is what that notice means. 

Senator Tobet. If I have a telephone and give it up and you are 
coming in my place of business, do I understand that they will give- 
it to you? It goes in the pool account and if phones are in short 
supply, they give it to the next man on the list, not to the next man 
in the place; isn't that it? 

Mr. Burt. That is right. Sometimes, Senator, if you are in busi- 
ness and another man goes and leases that place and goes in business 
there, and you have a phone, you understand, if vou will go i^p to the 
phone office, that is in Long Beach, and with the man — ^both of you 
go up there and say, "I am taking over this place of business," and he 
wants to sign off on the phone — of course, they can't give it to you 
until that man signs off. If he is right there and he says, "I want 
to sign off." 



ORGANIZED CREVIE IN INTERSTATE COMMERCE 309 

In this case, Mr. Kammerer is a real estate man for us. He would 
sign off and would sign up for it and pay whatever it was required, 
and it would be turned over to you under another name. 

The Chairman. Mr. Burt, who is the mayor of Long Beach? 

Mr. BuKT. Burt Chase. 

The Chairman. Who is the chief of police? 

Mr. Burt. Dovey, D-o-v-e-y. 

The Chairman. What is his first name ? 

Mr. Burt. I couldn't say right now. Senator. 

The Chairman. Do they do anything to stop these operations down 
there? 

Mr. Burt. Not that I know of. 

The Chairman. Does a sheriff operate in Long Beach, too? 

Mr, Burt. The sheriff has a substation there. Well, they have an 
office there up in the Guaranty Trust Building, 

The Chairman, I mean, do they do law enforcement in Long Beach, 
the sheriff's office ? 

Mr, Burt, I don't know just what law enforcement they do do there. 
I know they serve subpenas and I suppose they serve warrants where 
they came from up here. What other law enforcement they do there, 
I don't know. 

The Chairman. Anyway, it is well known by anyone who would 
make any actual inquiry that these operations are going on? 

Mr. Burt. It isn't any secret. 

The Chairman. Do they make substantial money; fellows like 
Irvine and Rains, out of their bookie operations ? 

Mr. Burt. Well, I imagine a bookmaker — as I say 

The Chairman. You make their income-tax returns ? 

Mr. Burt. Yes; on those that I make up. Yes; they make sub- 
stantial money. 

The Chairman. What do you mean, substantial? 

Mr. Burt. I would say they clear on their bookmaking, after all 
expenses, five, six, and seven thousand dollars a year. 

Mr. Chairman. That is not any great big money. 

Mr. Burt. That is not any great big money, but I mean for what 
they do. 

The Chairman. Any questions ? 

Senator Tobey. The only question I have is : You say these things 
are countenanced and everybody laiows they are going on. That isn't 
only peculiar in Long Beach, I understand; we find them in many 
places. 

Vn^o would have the right to gi-ab them by the nape of the neck 
and say "Get out." Wliat is the next source above them ? 

Mr. Burt. I would think the attorney general. 

Senator Tobey. That is the next one ? 

Mr. Burt. That is what I would say. 

Senator Tobey. And Howser is still in the office ? 

Mr. Burt. Howser is still in. 
^ Senator Tobey. Do you know of any case in Howser's administra- 
tion where he harried them? 

Mr. Burt. No, sir. 

Senator Tobey. He went along with them, did he? 

Mr. Burt. It looked like that. They voted him out on that account. 



310 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobey. Did mortification set in yet ? 

Mr. Burt. I couldn't say as to that, sir. 

Senator Tobey. You get sick of these chocolate eclairs, spineless 
officials and crooks down the line from the top down to the bottom. 
If it wasn't for Estes Kef auver and my colleague, Wiley, I would blow 
up. I get so darned tired of it. 

What comes over these crowds ? What is the matter with us ? 

Mr. Burt. I know one thing; I am an Arkansas Republican, and 
I voted one Democratic ticket, and that was for 

Senator Tobey. Both Republicans and Democrats are all alike in 
that respect. 

Mr. Burt. I voted for Pat Brown. 

The Chairman. How about these officials down there ? Sometimes 
Democratic and sometimes Republican? 

Mr. Burt. That is right. 

The Chairman. Is it about the same both ways ? 

Mr. Burt. I would think so, yes. 

The Chairman. Well, frankly, isn't it pretty well known that this 
fellow Rains — isn't he sort of the top fellow down there in gambling? 

Mr. Burt. Well, Rains over in Orange County and Seal Beach, I 
understand. He has that Garden of Allah ancl he has a big busi- 
ness there. I understand he is out there 

■ The Chairman. Isn't it pretty well understood that he gets pro- 
tection from somebody in his operation ? 

Mr. Burt. That is the consensus of opinion ; yes, sir. 

Mr. Chairman. And Howser is supposed to be a close friend of 
Rains ? 

Mr. Burt. I couldn't say to that. As I said, I only know Howser 
in a social way, that is, back and forth. 

Senator Wiley. What is the population in Long Beach? 

Mr. Burt. Three hundred and eighty thousand, I believe. It is 
over 300,000. 

Senator Wiley. How many of these bookmakers are from out of 
State, do you know? 

Mr. Burt. How many 

Senator Wiley. Just approximately. 

Mr. Burt. I don't believe out of the State — of course, these fellows 
are, most of them, out of the State, but I think most of them have 
been residents of Long Beach for some time. 

Senator Wiley, Long Beach is a sort of mecca for the tourists, too, 
isn't it ^ 

Mr. Burt. Yes ; it is a regular tourist town. There are two seasons 
there, one winter tourists and one summer tourists. 

Senator Wiley. Is there any other crime of any significance down 
There, bawdy houses, prostitution ? 

Mr. Burt. I don't know. You don't hear much about bawdy houses 
there, and I don't believe there is numy of them. You see, once in a 
while, where the police has raided one. I noticed about 2 months ago, 
and that is the first time I had seen it in about 2 or 3 yeai's. I think 
that goes on where they don't have any districts in the hotels. 

Senator Wiley. You said they have two seasons down there. What 
I am trying to get at is whether or not this gambling situation is due 
to the out of State folks that come in and want to play the games, and 



ORGANIZED CRIME IN INTERSTATE COMMERCE 311 

you have got folks here who take advantage of their desire for hav- 
mg some kind of a kick or what not. 

What I am trying to get at is 

INlr. Buirr. Senator, I see what you are trying to get at. As I say, 
we have a winter season, wliicli is the old people from the East and 
tlie Middle West comes there to get out of the cold weather. The 
summer season is when the young people come in there for a vacation. 
I believe it is the Long Beach people that su])ports the gambling. 
I don't think the tourists have much to do with it. 

Senator Wiley. How many out-of-State people really come in? 
Mr. Burt. Well, I know I couldn't say. 
Senator Wiley. Fifty thousand a year? 

Mr. Burt. Well, olf and on, 1 would say yes ; ves, sir, I would say 
50,000. 

Senator Wiley. Long Beach, apparently, is a place where there is 
considerable money, retired people? 

Mr. Burt. Lots of money. Banks are full of it from retired people. 
Senator Wiley. The gambling is mostly bookmaking, or what is the 
nature of the gambling? 

Mr. Burt. I don't know about the other gambling. As I say, the 
reason I happen to know the bookmaking — it is a well-known fact that 
they take bets, and I do have this income tax. As I say — in order to 
take that, there has to be an out-of-State connection by wire or other- 
wise. I would imagine they would. I couldn't give you anything 
about the wire service because I don't know. 

They get the results in a hurry, some way. How they do it, I don't 
know. 

jNlr. KoBiNsoN. I have two questions. Do you know Beanie Benson ? 
Mr. Burt. Yes, sir. 

Mr. Robinson. What business is he in ? 

]\Ir. Burt. Smith & Benson run a bar, a restaurant, and a pool hall. 
Mr. Robinson. Bookmaking? 

Mr. Burt. Beanie is supposed to be the leading boolmiaker in Long 
Beach for a long time. I don't know that ; I'm telling you what the 
opinion of people is. 

Mr. Robinson. Have you heard the arrest of the attorney general's 
sister on charges of prostitution in Long Beach ? 
Mr. Burt. No ; I never heard that, sir. 

Senator Tobey. i\.ttorney general's sister? What is her name? Is 
it Howser ? 

Mr. Robinson. No ; it is a married name. I can get the details for 
you. 

The Chairman. Anything else of Mr. Burt? 

Mr. Burt. I was going to say on these, I haven't any records to 
hide down in my office, w^ith the exception of the income-tax records, 
which I keep for 5 3'ears. I keep them where nobody can get to them 
because they are private papers. All of this kind of stuff lays on my 
desk. I am just wondering who broke in my office. 
The Chairman. I don't know. 

Mr. Burt. As far as that is concerned, you can bring them up 
here. There is nothing private in there. The only papers I keep 
locked up are private records. 



312 ORGANIZED CRIME IN INTERSTATE COMMERCE 

The Chairman. I assume tliat came from the telephone company. 

Senator Wiley. You came from Arkansas originally? 

Mr. Burt. Yes ; I was down there with Myers & Bratton. 

The Chairman. Wliere are you from in Arkansas ? 

Mr. Burt. Van Buren County. That is about 125 miles up in the 
Ozarks, north of Little Rock. 

Senator Tobey. Is there a man in the real-estate business in Long 
Beach named Sturges ? 

Mr. Burt. Yes, I don't know what his first name is, sir, but I know 
lie is in the real-estate business there. 

The Chairman. Thank you very much, Mr. Burt. 

TESTIMONY OP ALFEED GUASTI, LOS ANGELES, CALIF. 

The Chairman. Mr. Guasti, 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. Guasti. I do. 

Mr. EoBiNSON. Will you state the position that you held in the 
sheriff's office? 

Mr. Guasti. I was a captain in the sheriff's office, retired May 1. 

Mr. Robinson. In charge of what particular detail ? 

Mr. Guasti. Well, I had a special detail which included the anti- 
subversive, the training program, the reserve deputies and, well, any- 
thing that wasn't directly assigned or assigned by orders to another 
detail we worked, such as the personnel investigations, and things of 
that nature. And for a while we had a gangster detail. That is a 
two-man detail that compiled information on activities. 

Mr. Robinson. How long were you in the sheriff's office ? 

Mr. Guasti. Twenty-six years and one month, just a little over a 
month. 

Mr. Robinson, Did your duties, while you were there, to some degree 
replace the duties formerly handled by Capt. George Contreras? 

Mr. Guasti. Oh, yes. 

Mr, Robinson. In other words, you were the successor in that 
capacity ? 

Mr. Guasti. That is right. 

Mr. Robinson. Do you know Dave Rubin ? 

Mr. Guasti. Yes, sir. 

Mr. Robinson. Will you tell the committee who Dave Rubin is? 

Mr. Guasti. Dave Rubin is a local kid that grew up here. I have 
known him from practically boyhood, and he used to sell papers here 
in town. In later years he was in the bookmaking business, and then 
he was in the gambling business. 

Today I think he has some interest over in Las Vegas. 

Mr. Robinson. Do you know Mr. Curly Robinson ? 

Mr. Guasti. Yes, sir. 

Mr. Robinson. Will you tell the committee who Mr. Curly Robinson 
is? 

Mr. GuASTT. Mr. Curly Robinson I have known since we served 
together in World War I, the same organization. He is a local boy 
here, I think he was born over in Boyle Heights. He was a news 
kid here in the streets, and then he had a place of business across the 
street from the Examiner. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 313 

Then he went into the pinball game and the slot-machine business. 

Mr. Robinson. Isn't he generally recognized as the outstanding 
slot-machine man in the area ? 

Mr. GuASTi. That is his reputation. 

The Chairman. Who is this? 

Mr. Robinson. Curly Robinson. 

He also operates the Associated Operators of Los Angeles? 

Mr. GuASTi. I think that is broken up now. He did. It was Los 
Angeles County ; there was two. 

Camo, or something like that, was the city organization, and then 
he had the Associated operation, which was a county organization, 
and then the supervisors kicked the pinball and consoles and that 
stuff out, and I believe that shortly thereafter that organization was 
dissolved. 

Mr. Robinson. Did you have other income other than your salary 
from the sheriff's office ? 

Mr. GuASTi. No, sir. 

Mr. Robinson. Did you buy and resell any liquor license ? 

Mr. GuASTi. Yes, sir. 

Mr. Robinson. There was additional income, wasn't there? 

Mr. GuASTi. Oh, yes. 

Mr. Robinson. Will you tell the committee the details of that trans- 
action ? 

Mr. GuASTi. I had an opportunity to pick up a license when — I 
forget the year — they permitted one hundred and some odd licenses 
to be issued here in Los Angeles County. I had an opportunity to 
pick one of them up at the cost of the license. 

Senator Tobey. While you were deputy sheriff? 

Mr. GuAsTi. Yes. sir. 

Mr. Robinson. The profits you made on the license was how much? 

Mr. GuASTi. It was about $6,500. 

Mr. Robinson. Your associates in that venture, if any? 

Mr. GuASTi. Was — the license was taken out in Mrs. Guasti's name 
and the license was loaned to Warren Hunter, who opened up a bar 
in Long Beach and finally went broke. 

Mr. Robinson. In connection with your duties in the sheriff's office, 
did you handle the purchase of the shoulder patches for sheriffs' 
uniforms ? 

Mr. GuASTi. No ; I did not. 

Mr, Robinson. You know nothing about that? 

Mr. GuASTi. No, sir. 

Mr. Robinson. No money was ever given to you for that purpose? 

Mr. GuASTi. No, sir. 

Mr. Robinson. You didn't order the badges ? 

Mr. GuASTi. No. sir. 

Mr. Robinson. You are definite on that point? 

Mr. GuASTi. Positive. 

Mr. Robinson. Did you have any other transactions with Curly 
Robinson ? 

Mr. GuASTi. No, sir. 

Mr. Robinson. Are you familiar with 

The Chairman. Wliat was the one transaction you had with Curly 
Robinson ? 

G8958 — 51- 



314 ORGAXIZED CRIME IN INTERSTATE COMMERCE 

Mr. Robinson. I was just getting to that. 

Are you familiar with a trip that a Jean Armancl made throughout 
the State? 

Will you tell the committee about that trip, the purpose of it? 

Mr. GuASTi. Oh, it was, as I recall, a trip throughout the State 
during — I believe it was during Howser's campaign, or about that 
time. 

Senator Wiley. What year ? 

Mr. GuASTi, When he run for attorney general, 4 years ago; I 
imagine it was '46. I believe that is right. And he sent Jean Armand 
throughout the State to get a pulse on the activities in the various 
counties on pinball machines and things of that kind, slot machines. 

Mr. Robinson. Didn't the trip have two objectives designated as 
mission A and mission B ? 

Mr. GuASTi. No ; not that I know of, sir. 

Mr. Robinson. Mission A being the defeat of Pat Brown and the 
election of Fred Howser; mission B being the unification of slot- 
machine operators? 

Mr. GuASTi. Not to my knowledge, sir. 

Mr, Robinson. For the purposes of better legislation ? 

Mr. GuASTi. Not to ni}^ knowledge. 

Mr. Robinson. Were any reports of that trip submitted to your 
office? 

Mr. GuASTi. I got some of those reports; yes, sir. I was interested 
in the activities because at that time we were, I believe — ^I had a two- 
man gang squad, and we were interested in the activities, and it was 
valuable information to us, and I got a hold of it. 

Mr. Robinson. Why should Curly Robinson give you copies of that 
report ? 

Mr. GuASTi. Because I asked him to. He told me what he was doing 
so I said I would like to have them. 

Mr. Robinson. The reports would speak for themselves as to the 
purpose of them. 

Mr. GuASTi. Yes; I imagine they would. They were pretty 
thorough reports, sir. 

Mr. Robin SON. Contacted every slot-machine operator in the State ? 

Mr. GuASTi. I understand they did. 

Senator Wiley. What did they say? 

Mr. GuASTi. I can't recall now, sir. 

Senator Wiley. The substance of the reports? 

Mr. GuASTi. Who were the operators ; what the operator was ; who 
owned the machines, and the attitude of the — I believe the operators 
or the people in that communit}^ toward the election of Fred Howser. 

I believe that was the substance of the reports. 

Senator Wiley. Was it illegal to operate at that time those machines 
in the State? 

Mr. GuASTi. I think that in quite a few of the counties it was not 
illegal. Probably some of them it was, and I could not tell you 
which ones. 

Senator Wiley. How could that be, if you have got a fundamental 
State law on the subject? 

Mr. GuASTi. There is a law against the slot machine — it was op- 
tional ; they had a glorified slot machine which they called the console, 
electrically operated, and the pinball machine was optional with the 



ORGAXIZED CRIME IN INTERSTATE COMMERCE 315 

community I think there are still some communities that permit the 
pinball games. 

Senator Wiley. I wanted to know whether the particular things 
that he was checking, wliether they were legal or illegal under State 
law. 

Mr. GuASTi. The slot machines were illegal under State laws. 
Senator Wiley. What do you suppose was the purpose of this in- 
vestigation? Was there any prosecution that followed afterward? 
]Mr. GuASTi. No. 

Senator Wiley. You weren't along with them ? 
Mr. GuASTi. Oh, no. 

Senator Wiley. Why did you ask for copies of the report, then ? 
Mr. GuASTi. To give me a lead on the operations of the bigger type 
of — that referred to hoodlums, where they are operating and how they 
are operating throughout the State. 

Senator Wiley. As a result of this did any prosecutions follow 
under your directions ? 

Mr. GuASTi. No, sir ; it was outside of this county. All of that was 
in the northern part of the State. 

Senator Wiley. What was the real purpose of this adventure by 
Houser's lieutenants i 

Mr. GuASTi. I didn't know any of his men were involved. 
Mr. Robinson. It was not Houser's lieutenants. It was a man re- 
tained by Curly Robinson, the nominal slot machine man in Los 
Angeles, to make this trip. 
Mr. GuASTi. That is right. 

The Chairman. Was it in connection with Houser or what? 
Mr. GuASTi. It was a campaign in favor of Mr. Houser. 
The Chairman. Was Robinson handling Houser's campaign? 
Mr. GuASTi. No, sir. I believe he was interested in the campaign, 
but I don't believe he was actively working for Houser under any of 
Houser's directions, or anything like that. That is what I am trying 
to get at ; he wasn't a member of Houser's campaign committee. 

Senator Wiley. I think that is very fine. That is the danger of all 
these things, that we drew wrong inferences. In other words, there is 
nothing on the record to show anywhere that you know of that Robin- 
son or his miderlings were tied up with the attorney general of this 
State in this particular adventure? 
Mr. GuASTi. Not to my knowledge ; no, sir. 
Senator Wiley. Wliat do you say about that ? 

Mr. Robinson. I will let the reports speak for themselves — if the 
committee is interested in them, that is. 

Mr. GuASTi. I am speaking of my own knowledge, now. 
The Chairman. Let us get all the facts here. 

Mr. Robinson. This same Curly Robinson we speak about, you are 
familiar with the transcripts of the microphone recording made in 
Mickey Cohen's home? 

Mr. GuASTi. I have heard — all I know is what appeared in the 
papers, sir. 

Mr. Robinson. I think the transcript that appeared in the paper 
quoted Mr. Robinson as having said that Guasti had a piece of the place 
in Burbank that Mickey Cohen had. 

Mr. GuASTi, Didn't it say that Guasti O. K.'d it ? That is my im- 
pression, Mr. Robinson, that "It is O. K. with Guasti." 



316 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Robinson. I think it was a little stronger than that ; that Guasti 
had a piece of that. 

Mr. Guasti. As I remember having read it in the papers, it was : 
"It is O. K. with Guasti." 

Mr. Robinson. Are you the man that people would have to contact 
in order to get set up in the county ? 

Mr. Guasti. No, sir. 

Mr. Robinson. You never heard yourself referred to as the "Wine 
Merchant" ? 

Mr. Guasti. The "Wine Merchant" is a name that is used by legiti- 
mate people. Many people I am introduced to will say, "You are the 
Guasti Wine; you are the wine man." 

My answer to that is that I am one of the poor relations here. That 
is used more — I have heard, too, that the hoodlums picked it up and 
used it, but it was always used in the better circles. 

Senator Wiley. You mean there is a Guasti that is legitimately in 
the wine business? 

Mr. Guasti. Yes ; definitely. 

Mr. Robinson. Is your income tax presently under investigation by 
the Intelligence Section ? 

Mr. Guasti. Yes, sir ; I believe it is. It has been. 

Mr. Robinson. I have no further questions. 

Mr. Halley. Mr. Guasti, were you familiar in any way with the 
Guarantee Finance investigation? 

Mr. Guasti. There was only — the investigation part of it, no. I am 
not familiar with it. There was one contact made with me by Chief 
Standley in the district attorney's office. 

I believe it was 4 or 5 days, or it might be a little more and it might 
be less, before the raid by the commission of that establishment, tliat 
they were going to raid the Guarantee Finance on Florence Avenue, 
and it was a book and that they had better take care of it and knock it 
over, was what they meant by it. 

I said: "Fine, thank you." And I immediately called up Captain 
Pearson. I said, "They are going to knock over a bookie joint on 
Florence Avenue. It is a finance company." He said, "I am and 
have been on it." I said, "Will you call Standley and tell him ?" He 
said, "I will." And that is the end of that. 

Mr. Halley. What was your position in the sheriff's office at that 
time ? 

Mr. Guasti. Captain of the antisubversive detail. 

Mr. Halley. You had nothing to do directly with gambling 
investigations ? 

Mr. Guasti. None whatever. 

Mr. Halley. Did you ever hear of the occasion when the lieutenant 
Iby the name of Fiske of the Los Angeles police broke into that 
Guaranty Finance business and destroyed certain evidence of book- 
making ; that is, ripped up the tickets ? 

Mr. Guasti. Only in the paper after the case was broken. That is 
the only time, the first time I ever knew Fiske was in there, 

Mr. IFIalley. Are you familiar with the charge made in the Cali- 
fornia Crime Commission report that you wrote a letter to the Los 
Angeles police ? 

Mr. Guasti. Yes ; I read the report. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 317 

Mr. Halley. Complaining about Fiske having come into the 
sheriff's territory ? 

Mr. GuASTi. I read the report ; yes, sir. 

Mr. Halley. Have you any comment on that ? 

Mr. GuASTi. I never wrote a letter. I know nothing of any letter 
to Joe Reed. I know Joe Reed well enough to go and talk to him 
if I wanted to, but I never made any comment or never wrote a letter. 
I have been trying to find out where this letter is. I would like to 
see the letter. If it was written, I can be happy to look at the letter. 
Bui never wrote any such letter. 

Mr. Halley. Thank you. I have no further questions. 

The Chairman. Did you have a piece of that Mickey Cohen place 
up in Burbank ? 

Mr. GuASTi. No, sir. 

The Chairman. How do you suppose this claim about it came 
about ? Did you know about the place ? 

Mr. GuASTi. I knew about it because my gang squad knew the loca- 
tion and we knew it was heavily armed with hoodlums, and we wanted 
that bunch— we weren't particularly interested in the customers but 
we wanted that gang on the outside. 

The Chairman. Is Burbank in Los Angeles County ? 

Mr. GuASTi. Yes, sir. 

The Chairman. What did you do about it ? 

Mr. GuASTi. We finally raided one of them. We couldn't set the 
one up satisfactorily to get, but we got one. One of them was in the 
stable, a stable area, and another one was in a pottery plant of some 
kind. We got the pottery plant. My squad took the vice squad 
and Icnocked the place over. They arrested — they threw three or four 
of the hoodlums in jail on robbery to get a record on them and check 
on them and see who they were. 

We didn't get any further conviction on them for any other racket- 
eering activities. 

The Chairman. Why didn't you get the other place ? 

Mr. GuASTi. Well, it had to be set up. They were working on it. 

The Chairman. What do you mean "set up" ? 

Mr. GuASTi. When it was operating — it was a hit-and-miss deal. It 
wasn't a place that — you couldn't tell whether it was running or not. 
You would have to go out there to see whether it was operating, or 
send somebody out there, and it was just a hit-and-miss deal. They 
couldn't catch that thing when there was somebody in there, and things 
were really alive when these men would be on the outside. 

We wanted the men on the outside, who were all heavily armed, as 
we understand. But we did get the other one. 

Mr. Halley. Over a period of time it would certainly seem that you 
could get the evidence of something like that. What are the difficul- 
ties in getting the evidence on an operation of that kind ? 

Mr. GuASTi. It is a two-man detail. We did have a lot of work at 
that time and we were working, and it was just one of those things, 
if they didn't have anything particular to do they would run out 
there, because they felt as we did, that we will get that one of these 
nights. We will get it. But there were other activities that attracted 
their attention that they had to carry out also. 



318 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. What I don't understand is, you mentioned that you 
knew that this place was a gambling joint and that you were anxious 
to get in and yet you left it in the hands of a two-man detail who, as 
you said, didn't have the time to give it proper attention. 

Mr. GuASTi. I didn't have any more men. 

Mr. Hallet. If it was — how many men did you have ? 

Mr. GuASTi. I only had a two-man detail on that particular assign- 
ment. 

Mr. Halley. You had 1,800 men, didn't you ? 

Mr. GuASTi. I had under my command only nine men. 

Mr. Halley. But couldn't you ask the sheriff for a loan of six men 
for a week ? 

]Mr. GuASTi. If we were set for the raid, then we would naturally 
ask for additional help. We would have to have them. 

Mr. Halley. It seems to me — I have never been a sheriff, so I am not 
criticizing you, just asking — that there is a real question as to whether, 
if you were seriously trying to raid what obviously was at least one of 
the most serious law viol ations in the county, you would have handled 
it in a different way. 

Mr. Robinson. 'Who finally raided that place, Mr. Guasti? 

Mr. Guasti. Lieutenant Vigneaux and, I think it was Deputy 
Sheriff Harry Sand, and some members assigned from the vice squad. 

Mr. Robinson. Wasn't Lieutenant Wellpott there ? 

Mr. Guasti. No, he wasn't there. None of the police department 
was in on this one. I think they possibly took someone from Bur- 
bank. I am not sure of that. That is a policy that we generally 
followed. 

Mr. Halley. When did you retire, Sheriff? 

Mr. Guasti. May 1. 

Mr. Halley. When you retired, what was your salary? 

Mr. Guasti. My salary was — the captain's salary was $100 — and 
I believe it was $464, right in there. 

Mr. Halley. A month? 

Mr. Guasti. Yes, sir. 

Mr. Halley. Did you have any additional income in the year 1949 
other than your sheriff's salary as sheriff'? 

Mr. Guasti. No. 

Mr. Halley. You have been living on your salary as sheriff? 

Mr. Guasti. Yes, sir. 

Mr. Halley. With no other income ? 

Mr. Guasti. Outside of selling that liquor license. I sold a lot, a 
piece of property, cheap property, and then I sold a car at the height 
of the market and got a very good price for it. 

Senator Tobey. What is your net worth today ? 

Mr. GuAstt. Counting my property and home and money, I have 
in the bank, I would say around $20,0*00 to $25,000. That is counting 
everything. I made some nice profit on a piece of real estate during 
inflation. I bought a little home for $4,500. At that time you paid 
your own payments and your own down payment, and I sold that 
piece of property for $13,500. 

Mr. Halley. Do you oAvn an automobile ? 

Mr. Guasti. Yes, sir. 

Mr. Halley. IVliat kind? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 319 

Mr. GuAsTi, I have got a Pontiac convertible coupe. 

Mr. Hallet. Does your wife have any property in addition to your 
own ? 

Mr. GuASTi. No; and my daughter has a small Ford coupe, and 
she uses it to go to school. 

Mr. Haijley. Do you support your daughter, too? 

Mr. Guasti. Oh, yes. 

Mr. Halley. Where do you live ? 

Mr. Guasti. 1623 North Ogden Drive. 

Mr. Halley. Is that a home ? 

Mr. Guasti. Yes. 

Mr. Halley. You own it? 

Mr. Guasti. Yes. 

Mr. Halley. When did you purchase it? 

Mr. Guasti. 1946. 

Mr. Halley. What did you pay for it? 

Mr. Guasti. $25,000. 

Mr. Halley. What was your salary at the time ? 

Mr. Guasti. It was around $161:, I think, but I put the money that 
I — that was a joint deal. It was in the escrow that one was continued 
on the other. The sale of my house was contingent upon the purchase 
of the other place. 

]Mr. Halley. Where does your daughter go to school ? 

Mr. Guasti. Glendale Junior College — City College. 

JSIr. Halley. Is that a school that is free ? 

Mr. Guasti, Yes ; it is a State school. 

Mr. Halley. But you support your wife and your daughter? 

Mr. Guasti. Yes, sir. 

Mr. Halley. And maintain two automobiles ? 

Mr. Guasti. Yes, sir. 

Mr. Halley. A Pontiac convertible and a Ford ? 

Mr. Guasti. I just purchased the Pontiac. It isn't paid for yet. 
I still owe approximately a year's payments on that. I just purchased 
it ; just before I left the office I started that. 

Mr. Halley. You are now on a pension ? 

Mr. Guasti. I am on a pension now. 

Mr. Halley. How much is that ? 

Mr. Guasti. It is $169 something, but I also have a little bar out 
here and work part time, and once in a while for the UAW or the CIO. 

Mr. Halley. You say you have a bar? 

Mr. Guasti. Yes, sir. 

Mr. Halley. Do you own it ? 

Mr. Guasti. Half of it ; yes. 

Mr. Halley. When did you acquire that ? 

Mr. Guasti. July the 15th. 

Mr. Halley. What did you pay for it ? 

Mr. Guasti. $3,600 for a half interest. 

Mr. Halley. Who is your partner in that business? 

Mr. Guasti. Tex Kose. 

Mr. Halley. Tex Rose? 

Mr. Guasti. Yes, sir. S. Tex Rose is the way the legal signature is. 

Mr. Halij^a'. Do you have any safety deposit box ? 

Mr. Guasti. No, sir. 



320 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. Do you have any money in cash that is not entrusted 
in a bank account ? 

Mr. GuASTi. No, just what is around the house. 

Mr. Halley. You have no larger sums of cash ? 

Mr. GuASTi. No. 

Mr. Halley. What do you have in the bank today ? 

Mr. GuASTi. I think in the Bank of America in Beverly Hills there 
is in the neighborhood of $5,000, between $5,000 and $6,000, I can't 
be sure. 

Then, in the Bank of America on Sunset Boulevard and Hayworth 
I have somewheres in the neighborhood of $500 or $600 there. 

Mr. Halley. Do you have any other bank accounts ? 

Mr. GuASTi. No, sir. 

Mr. Halley. Does your wife have any other bank accounts ? 

Mr. GuASTi. No, sir. 

Mr. Halley. So in cash you have about $6,000 ? 

Mr. GuASTi. Right in that neighborhood. 

Mr. Halley. And you paid $3,800 for a bar ? 

Mr. GuASTi. $3,600. _ 

Mr. Halley. About in July ? 

Mr. GuASTi. Yes, sir. 

Mr. Halley. And the house you purchased with the proceeds from 
your former home, is that right ? 

Mr. GuASTi. That was the down payment on it; yes, sir. That 
is, I worked out a deal where the Bank of America owns quite a bit 
of it right now, the one in Beverly Hills. 

Mr. Halley. How much down payment did you have to make on 
the house ? 

Mr. GuASTi. I paid the house off and borrowed $12,000 from my 
brother-in-law, and the rest from the bank. 

Mr. Halley. And then you had your brother-in-law — you paid 
your brother-in-law back after you sold the first house ? 

Mr. GuASTi. Yes, sir. 

Mr. Halley. So you owe the bank? 

Mr. GuASTi. I owe the bank somewhere between $8,000 and $9,000. 

Mr. Halley. What are your monthly payments ? 

Mr. GuASTi. $100 a month. 

Mr. Halley. On the mortgage, is that right? 

Mr. GuASTi. That is right. 

Mr. Halley. I have a little difficulty understanding how you were 
able to accumulate enough money to buy a bar and two automobiles 
and to have a $6,000 bank account. 

Mr. GuASTi. I borrowed $2,500 to buy the bar. 

Mr. Halley. I see. From whom did you borrow that ? 

Mr. GuASTi. I borrowed that from a man by the name of Sam Win- 
ger. He is in the liquor business. It was secured by the license. The 
value of the license which he holds a chattel mortgage on is worth more 
than that loan is. I am trying to make the business pay itself oil, 
and it isn't. I am getting rid of it. It is on the market now for sale. 
However, I am fortunate that the licenses have gone up and it is 
worth, if I sell it — I will make a little profit on it. 

Mr. Halley. Do you have any servants at your home? 

Mr. GuASTi. No, sir. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 321 

Mr. Halley. Have you had in the past ? 

Mr. GuASTi. Never had any, never. 

Mr. Halley. Thank you. 

Mr. Halley. No further questions. 

Mr. Robinson. I have one. You mentioned that Mr. Standley 
called you with respect to a possibility of a raid on the Guarantee 
Finance. 

Mr. GuASTi. That is right ; Corporation Commission, I think it was. 

Mr. Robinson. Mr. Standley — that is H. Leo Standley? 

Mr. GuASTi. The chief of detectives. 

Mr. Robinson. Was it the practice of Mr. Standley to clear with 
you any complaints received in the district attorney's office? 

Mr. GuASTi. No, I don't believe so, but Lea and I have been friends 
for many, many years. 

Mr. Robinson. As a usual practice he usually called you on any 
complaint received by that office, did he not? 

Mr. GuASTi. No, not all complaints. Complaints on gangsters ; yes. 
How that happened I don't know. He happened to think of me, I 
guess, and he called me. I don't think he was acquainted with Mr. 
Pearson at that time. I am not sure, but I don't think he was. But 
I did know Mr. Standley when we was in the Burns Detective Agency 
some 20 years ago. 

Mr. Robinson. But it was Captain Pearson who was in charge of 
the 

The Chairman. Can we get one thing cleared up here ? This Curly 
Robinson business and Attorney General Houser; Robinson sent 
somebody out to find out what the slot-machine industry was in the 
State and who operated it and how they felt about Houser; is that 
correct? Wliat is the purpose of finding out how they felt about 
Houser ? 

Mr. Guasti. That is just what I am trying to say, sir. I think he 
was trying to put the support of those people behind Mr. Houser's 
candidacy. 

The Chairman. Do you know that from the reports submitted to 
you? 

Mr. Guasti. It is an opinion from conversation with Mr. Robinson, 
and the reports also — I don't think it comes out that bluntly, but I 
W6i>ild gather from the reports that is what it was. The reports had a 
lot of information in them. 

The Chairman. A lot of political information? 

Mr. Guasti. No, activity — slot machine and pinball activity infor- 
mation. 

The Chairman. Anyway, it is true, as you see it, that the purpose 
of this mission was to organize these people to get behind Houser; 
is that correct ? 

Mr. Guasti. I would say that ; yes. 

The CiiAiRiMAN. Then there was a close relationship between Curly 
Robinson and Houser? 

Mr. Guasti. How close, I don't know. I knew they did know each 
other for quite some time. I think before, he was — I think before he 
was ever in public office Mr. Robinson knew him. 

The Chairman. Robinson was a big man in this section in the slot- 
machine industry? 



322 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. GuASTi. One of them. We had three or four of them here. We 
had another Kobinson who was very active in that, too. 

Mr. Robinson. That is Charles Eobinson? 

Mr. GuASTi. That is right, Charlie Robinson. 

The Chairman. Did you have the impression that Houser pro- 
tected the slot-machine industry after he got in as attorney general ? 

Mr. GuASTi. All I can base my opinion on would be prejudicial 
because of what appeared in the papers. 

The Chairman. I mean, that is the general situation, isn't it? 

Mr. GuASTi. Yes ; that is the general opinion. 

The Chairman. Did you have jurisdiction down in Long Beach 
when you were deputy, when you were in the sheriff's office. Long 
Beach, Calif.? 

Mr. GuASTi. Any designated jurisdiction? 

The Cpiairman. No ; I mean, were you supposed to enforce the law 
down there ? 

Mr. GuASTi. No. You see, the detail I had we worked any place. 

The Chairman. But did you work in Long Beach ? 

Mr. GuASTi. Yes, on our activity ; yes. 

Senator Wiley. That was subversive, wasn't it ? 

Mr. GuASTi. Subversive and gangsters; yes, sir. We worked all 
over. 

Senator Wiley. How about all these fellows. Rains and Irvine and 
all those big bookmakers down in Long Beach ; did you ever get them ? 

Mr. GuASTi. We knew where they were. We weren't primarily in- 
terested in the gambling end of it as we were in their activity; who 
they were, where they were. 

Senator Wiley. You knew where they were and where they were 
operating, didn't you ? 

Mr. GuASTi. Yes, sir. 

Senator Wiley. Why didn't you go and close them up ? 

Mr.,GuASTi. That is one of those things that is up to the City of 
Long Beach — the city in which that violation was committed. 

Senator Wiley. You mean you wouldn't close up any gambling 
inside of a city limits ? 

Mr. GuASTi. No; I wouldn't because it wasn't assigned to me. I 
wasn't working gambling. 

Senator Wiley. Well, I mean, gangsters ; some of these fellows are 
gangsters, aren't they ? 

Mr. GuASTi. Well, they are in that element of people, yas, sir. 

Senator Wiley. All right. No other questions. 

I have one more question. 

I think this might clear it up. Was there any particular relation 
between subversives and gangsters ? 

Mr. GuASTi. No ; although there is a — in a great many of the places 
we did find some communistic literature. The squacl used to find 
it and they would send it over to us. The same if we found anything, 
we would send it over to the vice squad. If we found anything in 
county territory of a gambling nature, we would send it directly 
to the vice squad. If they found something — it is a common policy 
in the office that if you find something that belongs to a certain divi- 
sion, you send it to that division. 

Mr. Robinson. I have one more question. Was Lieutenant Pascoe 
an assistant of yours ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 323 

Mr. GuASTi. Yes, sir. 

Mr. Robinson. Was Lieutenant Pascoe in charge of the custody of 
Bugsy Siegel when he was in custody ? 

Mr. GuASTi. No, sir; that was way back there — he was a deputy. 
You mean when they took him out on court orders ? 

JMr. Robinson. Was Lieutenant Pascoe disciplined ? 

:Mr. GuASTi. Oh, yes. 

Mr. Robinson. What was the nature of the discipline ? 

Mr. GtJASTi. He was suspended for 30 days. 

INIr. Robinson. For what ? 

]Mr, GuASTi. That I can't tell you. The records would be there. I 
imagine for — would you say insubordination, not carrying out an 
order, or what it was. I don't recall. 

Mr. Robinson. That related to Bugsy Siegel's deputy while he was 
in custody. 

JMr. GiiASTi. That was in the Bugsy Siegel case; yes, sir. He got 
30 days suspension for it. 

I have some information that you are interested in, if I may give 
it to you; that is, gangster activity. I have the file. I would be 
very happy to give it to you. I am not too particular to let this 
be public record because there is some very good information in it, 
patricularly some information with regards to Mickey Cohen, all the 
gangsters, that I have compiled. I would be happy to give it to you. 
I took it upon myself to go to the office and get it and bring it over 
here. 

Mr. Halley. Do you have it here now ? 

Mr. GuASTi. Yes. Gangster activities, the names. There is a 
place here — where I believe one time I had a list of every bookmaker 
that ever attended Santa Anita. These are files out of the office. I 
do wish you would return them because I don't believe there is a copy 
of them anywhere. 

Mr. Halley. Is there anything you would like to tell us about 
them ? Is there anything you can summarize at this point about the 
significance of any part of them ? 

Mr. GuASTi. It is Nation-wide. It is the activity groups that mi- 
gi^ated in here from Detroit, Cleveland, Chicago, and information 
about the group down in Tucson, which is a remnant group of the old 
Purple Gang, the Mafias down there. It may be of some value to 
you. 

The Chairman. We appreciate it very much. It will be returned 
to you or to the sheriff's office. 

Mr. GuASTi. It will be returned to Lieutenant Pascoe, where we 
kept it — he took over my position — I would appreciate it. 

The Chairman. We don't want to be causing any difficulty here 
about taking the sheriff's records, if it is something he needs. 

Mr. GuASTi. No, I don't think he needs them. But it is there, and 
if you think you want them, I would be happy to give it to you. 

The Chairman. What is the particular point about Mickey Cohen 
that you mentioned ? 

Mr. GuASTi. It relates to the killing of Meatball Levinson. It is 
the story, not able to be proven, that he went to Chicago and hired a 
man to come out here to take care of the situation and take care of 
these two men, and after he took care of them he was to get 25 percent 



324 ORGANIZED CRIME IN INTERSTATE COMMERCE 

of Mickey's end. And that lie was to return to Chicago and remain 
there till this thing cooled off, and that at a later date Mickey called 
him and said, "Well, come on, get in the car and come on." So he 
did, and he got as far as Joliet and they blasted him. 
The Chairman. You mean he never got to California ? 
Mr. GuASTi. They killed him. 
The Chairman. What do you have in writing about that ? 

Mr. GuASTi. That is in here. 

The Chairman. I mean, do you have letters or something from 
Cohen? 

Mr. GuASTi. No, it is information from an informant. 

Senator Tobey. I wish you would have brought it in to us before 
■we had Mickey here. 

Mr. GuASTi. No one has ever asked me anything. No one has asked 
me a question on anything pertaining to this county. I have had this 
infonnation. I have offered it one time and it was deliberately ig- 
nored. I don't think it was purposely, I said, "John Hanson, I have 
got a lot of stuff down there. I will give it to you." 

The Chairman. Who was Hanson ? 

Mr. GuASTi. He was Mr. Robinson's predecessor. 

I said, "John, you can have it. I have a lot of information." 

The Chairman. Did you talk with the sheriff about this informa- 
tion? 

Mr. GuASTi. He has seen all of it. But the sheriff is a busy man. 
He can't remember all these things. 

Senator Tobey. "^^^lat is he busy doing ? 

Mr. GuASTi. A lot of things, sir. The demand on the man is terrific. 

The Chairman. Do you mean sort of public relations ? 

Mr. GuASTi. Good-will ambassador for the county of Los Angeles. 

The Chairman. It seems to me like they ought to have a dual 
sheriff, one for good will ambassador and one for the sheriff's work. 
Maybe they w^ould say the same thing about Members of the Senate. 

Senator Wiley. They ought to have a public relations man and a 
sheriff. 

Mr. GuASTi. When you go back to your home town, you are in 
demand; everybody wants to see the Senator. Everybody wants to 
see him there. They don't want to see a representative from his office. 
They want Mr. Biscailuz, and the man's popularity is such that he 
keeps a very busy man. 

Senator Tobey. How did he get so popular? 

Mr. GuASTi. He is a wonderful man, believe me. He really is. 

Senator Wiley. How old is he ? 

Mr. GuASTi. I think he is 66 or 67. 

The Chairman. We will take good care of this. 

Mr. GuASTi. I think you will find some very interesting mat^fial. 

The Chairman. We will return it to you. 

Mr. Guasti. My phone and address is in there and you can send it 
lip. 

The Chairman. We will say nothing about it. 

Mr. Guasti. It is confidential — if I have to give you the informant, 
I will be happy to, if it meets with his approval. 

The Chairman. Find out; talk to the informant and let Mr. Eobin- 
son or Mr. Halley know. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 325 

Mr. GuASTi. Mr. Robinson, as soon as lie finds out if lie wants any 
further information, he will contact me. We can set up that end of it. 
Mr. Robinson. Thank you very much. 

TESTIMONY OF ERNEST TOLIN, UNITED STATES ATTORNEY FOR 
SOUTHERN CALIFORNIA, LOS ANGELES, CALIF. 

Mr. Robinson. I think you might find it helpful if he could give 
you a brief resume of the narcotics case which resulted in the shooting 
of his principal witness, Abraham Davidian, and involves Joe Sica 
and the rest of the Sica crowd and the narcotic ring, and Abraham 
Davidian was to be the principal witness. It was 2 days after you 
indicted the principal group that Davidian was shot in his own home 
in Fresno. 

Mr. ToLiN. My assistant, Norman Newcomb, who is one of the oldest 
and most skilled men in the office, has been handling that. I can't 

five 3^ou the details on it. It was known that Davidian was going to 
e possessed of a large quantity of narcotics ot a certain time. 

Davidian was connected with a large narcotics ring. It was felt 
also that Davidian had recently been connected with it. He was just a 
hoodlum, a petty hoodlum who was just getting into the narcotics 
work, that it might be possible to bring him and use him as an inform- 
ant. As a result of surveillance by the narcotics people, Davidian was 
arrested and the appraisal made by the narcotic agent was correct; 
Davidian did give a complete story in which he involved a great many 
people. 

It did not directly involve Dragna but I think that it would have, 
had Davidian lived and the case gone on. 

Davidian was on liberty on bond and the case was set for trial. 
There had been every effort made to keep it from the public, from the 
press, and from the codefendants, the fact that Davidian had given a 
complete story. Davidian's story was the only real piece of evidence 
which gave complete details. 

It spun the tale of the conspiracy and then there was a lot of cor- 
roboration here and there which corroborated it. But if you took that 
corroboration without the narrative that Davidian gave, it would not 
be sufficient to spell out a whole case. 

The case was set for trial and at the time it was set for trial — I don't 
know what occurred — but apparently it was sensed by the other de- 
fendants that Davidian had been talking to the Government people 
and that he was going to help out on the prosecution. It was set for 
trial as to him as well as to others. But he went out into his mother's 
home in Fresno, which was within this district, and while sleeping on 
a couch there in the daytime — he was quite an owl, like many of these 
people are, out all night — taking a nap in the daytime, somebody 
walked in and shot him through the head and killed him. 

As a result, the narcotics case, while still pending — we have got con- 
tinuance after continuance; we are still working on it — but as a result 
of Davidian's death we are without the narrative of the witness, the 
teller of the inside of it, which will make it a case upon which we can 
procure convictions. 

I do not expect success in that case at this time. However, the nar- 
cotic bureau, the FBI, have been able to salvage certain satellite cases. 



326 ORGANIZED CRIME IN INTERSTATE COMMERCE 

We felt we have lost the ability to go forward successfully with our big 
case so we might as well go forward with the four or five satellite cases 
that can be worked up out of it. The investigation into Davidian's 
death has brought to our attention various other crimes. For in- 
stance, it was discovered that a man named Rusty Doan was operating 
a house of prostitution in the San Joaquin Valley and that he had 
transported a woman in interstate travel incidental thereto. He is 
scheduled to be tried on December 11 for violation of the Mann Act and 
for conspiracy to violate it. 

That case was originally set for trial this week, which we are just 
now concluding. It was necessary to use one of the prostitutes as a wit- 
ness. That woman had been cooperative in keeping in touch with the 
Department so that we knew where she was, but within a few days of 
the trial she dropped out of sight. 

We couldn't find her. We knew of a man who did know, we felt, 
where she was. So I issued a complaint against her charging her 
with flight to avoid giving testimony. That statute, I think, you are 
considering broadening because it doesn't relate to testimony just in 
any case; it is part of the flight to avoid prosecution. I knew that if 
it were broadened to include flight to avoid prosecution for any felony 
or any one of the serious misdemeanors, it would be a valuable thing. 
We charged her with flight to avoid giving testimony in a felony 
prosecution. Then we went down to the man who we felt knew where 
she. was 

We said, "You know where this girl lives." 

He said, "Yes, I know, but I can't tell you. She said she don't want 
me to. I get messages to her, and then if she wants to call you back, 
all right." 

So he was then informed that the complaint had been issued and that 
an agent had it, waiting to serve a warrant upon her. 

His continued refusal then put him in the position that he was 
concealing or harboring a fugitive inasmuch as she was a fugitive 
upon the complaint charging her with flight to avoid giving testi- 
mony. The man was arrested on a complaint we then issued against 
him. When he was brought in and placed under heavy bail he then 
said, "Please make this bail something I can meet and I will go out and 
get the girl." The bail was placed then at $7,500. He stepped to the 
telephone by the permission of the keeper, telephoned a relative, and 
within a very short space of time his mother came in with $7,500 in 
cash and deposited the cash bail. 

He then went out and by appointment to meet the girl through the 
regular hours of the marshal ; he brought the woman in. However, 
that was the day following the day the trial was to have been set. 

The Chairman. So you are going to try it next week ? 

Mr. ToLiN. We are going to try it next week instead. 

Senator Tobey. How long will that trial take, j^robably ? 

Mr. ToLiN, It AYon't take 2 or 3 days. 

TESTIMONY OP DONALD 0. BIRCHEE, TAX CONSULTANT, 
GLENDALE, CALIF. 

The Chairman. Mr. Bircher, 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 ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 327 

Mr. BiRCHER. I do. 

Mr. Halley. What is your full name? 

Mr. BiRCHER. Donald O. Birclier. 

Mr. Halley. Where do you live ^ 

Mr. BiRCHER. At 2759 East Glen Oaks, Glendale. 

Mr. Halley. What is your business? 

Mr. BiRCHER. I am a tax consultant. 

Mr. Halley. Were you formerly employed by the United States 
Bureau of Internal Revenue? 

Mr. BiRCHER. Yes, the Intelligence Unit. 

Mr. Halley. When did you resign? 

Mr. BiRCHER. August 31, 1950. 

]Mr. Halley. With whom are you now associated? 

The Chairman. Did you retire? 

Mr. BiRCHER. I retired after 28 years' service. I had certain so- 
called hazardous experiences in different branches other than this 
branch, in the Navy before, and immigration on the border, so that 
I became eligible to retire under the 20-year bill the same as the FBI 
agents. 

Mr. Halley. With whom are you now associated ? 

Mr. BiRCHER. I am practicing alone. I have an office at 206 Warner 
Brothers Theatre Building in Hollywood. I have no associates. 

Mr. HLvlley. Have you any association with a man named Sack- 
man ? 

Mr. BiRCHER. No ; I do not. 

Mr. Halley. Did you ever? 

Mr. BiRCHER. Yes. 

Mr. Halley. When did you become an associate with Sackman? 

Mr. BiRCiiER. I entered into an informal partnership or an associa- 
tion or employment arrangement which was never reduced to a part- 
nership agreement the day following my retirement from the service. 
That is, I entered into mj^ association with him on September 1, 1950. 

Mr. Halley. How long were you associated with him ? 

Mr. BiRCHER. Until October 21, 1950, when I decided that I wanted 
to go out by myself. 

jSIr. Halley. What were the circumstances which led to your deci- 
sion to separate from Sackman? 

Mr. BiRCHER. Well, in Government service I had worked 8 to 10 
hours a day, and when I went out to work for him I was working a good 
deal more. When I went out to work with him they told me that I 
could have a private office in the suite that he had, or adjoining the 
suite, and they were unable to get that private office for me. And the 
result was that I had nothing but a workbench for a desk, and I didn't 
like the arrangements there, and so I decided to go out for myself, and 
I gave him formal notice. 

Mr. Halley. When you made your arrangements with Sackman, 
were you still employed by the bureau ? 

Mr. BiRCHER. Yes : I have — I believe we made an agreement — I be- 
lieve it was dated the date of my fiftieth birthday, the clay that I 
decided to retire, possibly the day before. 

I have had no contact with Sackman for 12 years. I have had only 
one case, tax case, that I had ever had with him, and I won the case — • 



328 ORGANIZED CRIME IN INTERSTATE COMMERCE 

I mean, the Government prosecuted the man and sent him to the 
penitentiary. I had no other experience with him. 

But he made me an offer. He knew I wanted to go out of the service. 
I told several people I was planning to retire, and he made me an offer 
to go with him at a minimum salary of $10,000 a year or 40 percent 
of his profits. Later it was to be reduced to a partnership agreement 
if the Government accepted my application for retirement. That is 
the extent of our agreement. 

Mr. Halley. Do you have that with you ? 

Mr. BiRCHER. Yes; so it was really more of an employment basis 
than a partnership. We never did get it reduced to a partnership 
when I decided to move. 

Mr. Halley. At that time did you realize that he represented 
Mickey Cohen and a number of other gamblers ? 

Mr. BiRCHER. I had heard that he had. I never met Mickey. I 
talked to Sackman about it when I talked about joining him, and he 
said that he felt that everyone was entitled to the best representation 
that he could obtain from an attorney or from a bank or from a grocery 
store, and he said that he had never had any irregularities with them, 
and he said that that was his feeling : When you go out in private law 
practice or accounting practice you have to take care of everybody 
who comes along. 

He said he represented people in the motion-picture business, busi- 
ness people, professional people, and a lot of gamblers, and different 
people who had that reputation. 

Mr. Halley. At that time Mickey Cohen was under investigation 
by the Internal Revenue Intelligence Unit, wasn't he ? 

Mr. BiRCHER. Yes; that is right. 

Mr. Halley. Did you feel that there was any conflict involved or 
impropriety in your resigning to go to work for a man, for the man 
who w^as representing Mickey Cohen? 

Mr. BiRCHER. No ; I didn't think so, because I had not worked on 
Mickey Cohen's case and knew nothing about it. I hadn't talked to 
any of the agents. 

Mr. Halley. But you knew it was an active investigation ; is that 
right? 

Mr. BiRCHER. I knew it was one of those that was pending, that was 
dragging. I didn't know the status of it. 

Mr. Halley. After you left the Bureau and Avent to work for Sack- 
man, did you then work on Mickey Cohen's case ? 

Mr. BiRCHER. No; I never worked on it. I never saw any of the 
papers. I never saw a list of clients while I was employed in the office. 
I never opened the business mail. 

Mr. Halley. Did you ever see Mickey Cohen? 

Mr. BiRCHER. Yes; twice. 

Mr. Halley. What were the circumstances? 

Mr. BiRCHER. About 3 weeks after I went into Mr. Sackman's office, 
Mr. Cohen came in one day and sat in the waiting room. My room 
was on the opposite side from Mr. Sackman's. There was a waiting 
room as you enter the main office. Mr. Sackman called me in and he 
said, "This is Mickey Cohen outside," and he said, "I will bring him 
in and introduce you." He said, "Don't call him Mickey; call him 
Mr. Cohen." 



ORGANIZED CRIME IN INTERSTATE COMMERCE 329 

So he came in and I met liim and shook hands with him, and then 
I left. I didn't stay around to talk. 

Mr. Halley. Did you see him on any other occasion ? 

Mr. BiRCHER. One other occasion, at the office, and one occasion 
outside of the office. 

Mr. Halley. Was any business discussed on either of these occa- 
sions ? 

Mr. BiRCHER. On none of them. He never told me what he was 
doing, what interests he had. 

Mr. Halley. Where did you see him outside of the office ? 

Mr. BiRCPiER. One day I called in our office. I have a real-estate 
broker's license, and I had told Harry Sackman that I had an interest 
in an oil well and that there were some lots in the neighborhood out 
on One Hundred and Twenty-eighth and Figueroa tliat had signs 
on and were available for sale, and I would like to buy them for Mr. 
Sackman's company, buy them, or if he found any clients who wanted 
to buy them maybe I could make a commission as a real-estate broker. 

We had no further discussions about the matter. One day I called 
our office and asked if there were any messages for me, and Mr. Sack- 
man said Mr. Cohen wants to "meet you out near your oil well, where 
you tell me they are doing some work, trying to deepen the well from 
6,000 to 8,000 feet. There is a lot of work going on out there, and 
Mr. Cohen wants to drive out that way, and can you come into the 
office." 

I said, "No ; I won't have time. I have got other appointments." 

Well, he said, "Be out there near the place at 2 : 30 and wait for 
him." So I went out and I parked my car on the corner in the middle 
of the road so that everyone would be able to see me, because I didn't 
know how he was coming. I didn't know how to identify him, how 
he might arrive, or I wasn't sure I would know him if he came up. 
I didn't know who he was going to be with. 

So I waited from 2 : 30 until 3 : 30, and a beautiful blue Cadillac 
car came around the corner and stopped, and I recognized Mr. Cohen. 
So I got out of my car, walked over to his car, and he said, "Where 
is all these operations?" And I pointed across the street, or down 
the street a quarter of a block. And I said, "That is where all the 
trucks are and all that equipment and all those pipes standing in the 
air." 

He said, "Let's go down and look or walk around. Can I go down ?"" 

So T says, "Yes." So we walked down there, walked around for 
about 5 minutes, and he didn't make any — make any comments, just 
walked around and looked at the equij^ment. And then he thanked 
me, and then he said, 'Do you know if anything is available in this 
area ?" And I said, "No ; I don't." 

And that was the end of it. He thanked me and left. We had no^ 
discussions. I had nothing for sale. 

Mr. Halley. Was there any discussion either before or after you 
left the Bureau of Internal Revenue between you and Sackman about 
whether or not you could be helpful in the Cohen case? 

Mr. BiRCHER. No; there had been none. It wasn't pleasant when 
I left. I mean, I wasn't satisfied. Several people told me that they 
could send me business if I was alone, and they didn't like my associa- 
tion, and I felt that I could do just as well by myself and so, rather 

68958— 51— pt. 10 22 



330 ORGANIZED CRIME IN INTERSTATE COMMERCE 

than enter a partnership agreement, I notified him Friday afternoon, 
when I decided to leave, that our business associations were termi- 
nated. 

I have not seen him since or talked to him since except for one period 
of about 10 minutes about 3 days later when he said, "Come in and 
get your check for the balance of $163 that I still owe you." We have 
had no other discussions. 

Mr. Halley. Did you have the Bugsy Siegel investigation ? 

Mr. BiRCPiER. Yes; I had one of them. 

Mr. Halley. Did that ever result in a prosecution? 

Mr. BiRCHER. No ; it didn't, because Bugsy Siegel was an unusual 
individual. He was a very energetic type of fellow. He had an 
aviator's license. He was fine looking. He wore excellent clothes. 
He had all the self-confidence in the world. He was hard to get to 
talk to. I had difficulty locating him. I finally located him through 
his accountants and arranged for him to come to our office. I finally 
got to see his books and records. All he had was a little black book 
with one page for each day with a column headed "W" and "L" — 
w^ins and losses. And he would show if he won $500, lost $500, or 
$1,000 and $700. At the end of a lot of those columns and at the end 
of such a book he would indicate a total profit of about $20,000 for 
that year. 

I asked him how T could verify those wins and those losses. 

Senator Wiley. What year was this ? 

Mr. BiRCiiER. That was a long time ago. I presume '36. That 
was the only time I ever investigated him. At the time I talked to 
him I asked him how he thought I could attempt to verify those wins 
and those losses, and he said that that was impossible, that he couldn't 
verify tliem. He said frequently he would go in and sit down at a 
race track in his box and somebody would come in that he didn't 
recognize, or two or three other men would come in, and sit down with 
him. And they would hold up their fingers indicating what they 
thought about this point or which one would come in first, or a base- 
ball game. In a few minutes they could settle their accounts. And 
that was the end of it. 

He said he didn't know the people he would bet with. I checked 
all his bank accounts. I found that he was getting substantial sums of 
money from somebody in St. Paul, a big advertising calendar firm. 

The Chairman. Brown & Bigelow? 

Mr. BiRCiiER. Yes. Brown & Bigelow. 

Senator Wiley, What do you mean by "substantial sums of money" ? 

Mr. BiRCHER. Well, I think one time he got $50,000 or $60,000; 
another time $20,000. Another time I found he had got a lot of art 
pictures, original art paintings, given to him and to his wife or chil- 
dren, shipped out, and I was very suspicious as to w^hat those were. 

I thought probably they were shakedown payments'. But finally 
this representative of Browm & Bigelow came out to Arizona and the 
next thing I knew he had an affidavit from him and presented to us 
that they were repayments of a loan, and he verified — we tried to verify 
that cind we found that it was true, that when Mickey was — when 
Bugsy was opening up some business out here at one time he had called 
on this representative of Brown & Bigelow to get him some money, and 
this representative went into a bank and purchased some large cash- 



ORGANIZED CRIME IN INTERSTATE COMIVIERCE 331 

ier's checks for $50,000 or $60,000 in currency, and this official said 
that it was repayments of loans that he obtained from Bugsy when 
he was trying to buy control of Brown & Bigelow. 

We checked back further to verify that and we found that he had 
borrowed some money but we couldn't verify that he had obtained 
it from Bugsy Siegel. But it wasn't possible to determine — ^to verify 
his income — Bugsy's income or expenses. 

Mr. Hallet. Did you say you investigated Bugsy only in 1936? 

Mr. BiRCHER. I think that is the only time. 

Mr. Halley Were you in charge of a continuing investigation up 
to the time of his death ? 

Mr. Bircher. Occasionally we would get requests from our office in 
New York for collateral investigations on something to do with Bugsy, 
and either I or one of my men would make the investigations, and it 
would come through my hands. 

In other words, there are 45 special agents on the Intelligence Unit 
here in the Los Angeles office, and they are divided into three groups, 
and I headed one of those three groups. 

Senator Tobey. Was Bugsy an attractive looking fellow ? 

Mr. Bircher. Very fine looking, very sharp. He had a wonderful 
personality. He would come in and shake your hand and you would 
know your hand was shaken. A fine-looking fellow. And he was an 
aviator. He was a wonderful athlete. I found in checking his ex- 
penses that he worked out at the Hollywood Athletic Club and two or 
three athletic clubs frequently. Handball and boxing. He had all 
the personality and all the pep in the world. He would have been a 
good salesman or a successful man at anything he attempted to do. 

Mr. Halley. Did you habitually allow these gamblers to charge up 
unprovable expenses without disallowing them? 

Mr. Bircher. I really don't have much option about that. 

Mr. Halley. Don't you suppose — suppose it says: "Wins, $500: 
losses, $100." The wins are his own admissions against his interest. 
Fine. The losses he ought to be made to prove. If he can't, why 
don't you just disallow them? 

Mr. Bircher. You could disallow them, but the Revenue Act con- 
ferees who handled the case after we finished it, or the Tax Court or 
the Federal courts, would upset the decision ; so it wouldn't be of any 
avail. 

Mr. Halley. We see a lot of income-tax returns from fellows' like 
that, and the expenses are never itemized. Do you feel that you 
couldn't get away with disallowing that? 

Mr. Bircher. The Tax Courts have upheld the Government in some 
instances where you can show a person claims to have had certain de- 
ductible expenses, and where they are unable to itemize, where they 
don't have satisfactory proof. 

Mr. Halley. I know in my own business anything we can't itemize 
gets thrown right out. Is that just because it is a legitimate business ? 

Mr. Bircher. That is true. 

Mr. Halley. Do illegitimate operators get preferential treatment? 
Is that the point ? 

Mr. Bircher. No ; I don't think so. In our work in the Fraud Di- 
vision we try to bill cases that will stand up in court. Otherwise, you 
figure you haven't accomplished anything, just to build up more liti- 



332 ORGANIZED CRIME IN INTERSTATE COMMERCE 

gation. I tliink there are certain weaknesses, possibly places for im- 
provement, in the tax laws along the lines you have indicated. 

For instance, I believe it was about 1933 I was in charge of a group 
of investigators of a number of abortionists, doctors and midwives, 
druggists, general nurses, not registered nurses, different ones who were 
performing abortions up and down the coast, from Seattle to San 
Diego. The story regarding that investigation and the results are 
contained in Mv. Irey's book, Elmer Irey's book. The Tax Dodgers. 

He was the Chief of the Enforcement Division. At that time we 
had one case in San Francisco where a couple of — well, it was la 
pharmacist's mate, one of the men. He had never had any medical 
training other than as a pharmacist's assistant, but he was performing 
abortions up in San Francisco. Another one who assisted him, a reg- 
istered pharmacist, who assisted him in his work occasionally and who- 
helped send his business to his office — his principal job was to contact 
drug stores and get them to refer cases, abortion cases, to the so-called 
doctors. 

Some of them were genuine doctors ; some of them weren't. It was 
my theory, when we first started working on that type of cases, that 
such expenses as the doctors claimed for having paid reference fees 
to druggists and others who were not legitimate doctors should not h& 
allowed as deductible business expenses. If they were malum in se^ 
they were not only prohibited, but they were bad violations. They 
were moral turpitude, embodied moral turpitude. I tried to get the- 
Bureau to agree with me on that, but they would not. They said that 
any expenses which were paid in the conduct of the business, whether 
it is legal or illegal, should be allowed. 

Finally, I was so persistent that they sent out two letters, one agree- 
ing with my ideas on the subject and one disagreeing, and sent it to the 
United States attorney's office in San Francisco, and there I had an 
opportunity to argue it further, and he followed my line of reason- 
ing, and we won the case. 

We got the indictment and the plea of guilty. Then followed the 
civil case. For the first time that question was then presented to 
the Tax Court, and they also followed my line of reasoniig. Since 
then they have not allowed such deductions when they are bad in them- 
selves. When they involved moral turpitude, tliat is. That is, so far 
as doctors paying fees to other doctors for criminal cases, criminal 
abortions, or paying them to druggists. 

But I have had other similar cases on other types of cases where I 
had certain investigations of ideas as to those things, and I have had 
the Government follow them in some instances. 

Senator Wiley. Then the Federal statute isn't definite like State- 
statutes ? 

Mr. BiRCiTER. That is certainly correct. 

Senator Wiley. It should be corrected as to what expenses should 
be allowed. Complementary to what you said I had a deuce of a time- 
during the war to get the Federal department to allow about $1,000 a. 
year for lunches that I had to buy during the war. The luncheon- 
time in the Senate was the only time you would have to talk to folks 
that came down on Government business, and it didn't amount to any- 
thing, 75 cents, $1 apiece, but it ran up. Every month, $100, $200, $250' 
for years. I couldn't get them to allow that. I said, "You let a lawyer 



ORGANIZED CRIME IN INTERSTATE COMMERCE 333 

•come down. He can call me downtown, spend $40, $50, and deduct it 
as part of the operation of his business." But as a poor Senator you 
couldn't deduct it. Finally they allowed it the last 2, 3 years. But 
that is one thing we should bear in mind. The statute itself should be 
corrected and be definitive in its character. 

Senator Tobey. Would they allow that type of lunch you speak 
of — but would also allow you to take out guests in the evening, that 
part of entertaining? 

Senator Wiley. No ; not entertainment. I told them — I said, "I am 
so busy and these people all come down, I tell them I can't see them. 
We have got our committee meetings in session. I will see them at 
noon. 'Be my guest at noon and we will discuss your proposition.' 
It wouldn't amount to a great deal." They would amount to around 
$1,000 a year; but, after all, it was far more legitimate than a brother 
wdio would come down, a practicing lawyer, who would take me down- 
town. I have seen him spend $40, $50. 

Legitimate deductions; sure. Every corporation permitted it. 

Senator Tobey. In your work as a tax expert in connection with the 
Government particularly, did you ever see anything or hear anything 
that caused you to raise your eyebrows along the lines of some officials 
in the Internal Revenue Bureau having collusion with some entrepre- 
neur outside and holding up somebody and putting the fear of God 
in his heart that he would be prosecuted unless he came across ? 

Mr. BiRciiER. You mean extortion? 

Senator Tobey. Yes. 

Mr. BiRCHER. I haven't. Had there been any such instances, I 
believe, now that you mentioned — there have been a few instances of 
that kind where our office — where such items were brought to the at- 
tention of our office, where possibly a deputy collector would attempt 
to obtain something from someone for a settlement. Tliere have been 
a few instances. I recall one here in Los Angeles about 15 years ago. 
I don't think the man as yet has ever been apprehended, a deputy 
collector, who was indicted. 

Occasionally that happens. But very, very seldom it happens, and 
"when they do, the Government vigorously goes after them. I mean, 
those matters are reported to the Intelligence Unit, and I think we 
have in the Intelligence Unit one of the finest organizations in the 
country. I have always been proud to be connected with it, and I 
have been on many important investigations in different parts of the 
country. I was down on the Huey Long and on the O. K. Allen case. 
I had charge of the O. K. Allen case and a group of investigators 
there. 

I had charge of a group of investigators up in Boston in 1937 when 
-we were checking then. Our offices have always been very, very clean. 
We haven't had any corruption. Our men are rated on their efficiency 
based on their energy and ability and knowledge, and yet they should 
be resourceful and conservative so that they don't make mistakes. 
That is one of the important things. 

Mr. Robinson. Was the Guasti case in your section ? 

Mr. BiRCiiER. No ; I know nothing about that. There is one or two 
more, just one more item that I might mention. You asked me about 
these deductions. 

During and since the war I was in charge of all the meat investiga- 
tions involving tax frauds on OPA violators in this area, packers, 



334 ORGANIZED CRIME IN INTERSTATE COMMERCE 

wholesalers. At that time it was onr opinion that expenses for over- 
ceiling payments by retail markets and by wholesalers to the slaugh- 
terers, or to cattle growers, should not be allowed as deductions be- 
cause it was our theory tliat any deductions are contrary to public 
policy, which are in violation of State or Federal law and should not 
be allowed as deductions. That was my theory. 

Many of them in the Bureau in the different offices didn't agree. 
But we tried to present our ideas as forcefully as we could, and finally 
they did agree with us for a period of years. Then the courts changed 
it, and now they are back on the fence, and they said that any over- 
ceiling payments prior to January 1, 1945, will be allowed if a man 
can show that he made overceiling payments. Those since have not 
been allowed. 

And I understand within the last few months they are again divided 
on the subject. 

Congress has not clarified these items. 

Senator Tobey. Those activities are opening up again. 

Mr. BiEciiER. Yes ; I have the same situation a few years before with 
reference to spirits, alcohol. I had charge of a number of investiga- 
tions involving the distribution of alcohol in this neighborhood. At 
that time it was my theory that such expenses for secret rebates 
were a violation of the State Fair Trades Practice Act, or the Unfair 
Trades Practice Act. There are two different acts. I thouglit those 
were violations of law, whether they were Federal or State; they 
should not be allowed by the Government as ordinary and necessary 
business expenses. 

If we disallowed those and defined what should be allowable and 
what should not be allowable expense, it would make taxes easier for 
everybody and so discourage crime, 

I have so argued in many of my reports, I have had considerable 
arguments with people from the legal departments in the Bureau. 
Sometimes they would make it optional with the local attorneys 
whether they would follow those. 

Senator Wiley. How about black-market and gray-market prices? 

Mr. BiRCHER. That is what I am talking about to some extent. 
Prior to January 1, 1945, the Bureau decided — the Commissioner ad- 
vised us that we were to allow such a black-market or gray-market 
over-ceiling prices as part of the cost of goods. Since then we were 
not. Now, recently, there is a question whether we should or whether 
we shouldn't. Some courts in some jurisdictions say that it is proper 
deduction. Some say that it isn't. But that has always been my 
theory : that if someone could get Congress to define what are proper, 
allowable deductions, and when they involve anything in violation of 
public interest, such as some expense that tends to enable a person to 
carry on an illegal business, if it is in violation of State or Federal 
law, I think maybe if they define and said that if it was a violation of 
law, such expenses should not be allowed, then I think it would tend to 
discourage crime. 

Senator Tobey. In going over some return and you find something 
that is illegal, is it considered that it is your privilege and duty to re- 
port it to the authorities ? 

Mr. Bircher. You can't report it. 

Senator Tobey. You can't ? 



ORGANIZED CRIME IN INTERSTATE COMIVIERCE 335 

Mr. BiRCiiER. No. If I am checking a narcotic peddler down here 
at the corner drug store and I find he is paying to the police depart- 
ment, or if I find he is paying 

Senator Tobey. Is that in the law ? 

Mr. BiRCHER. Yes. You are proliibited. You cannot report it to 
any officials. What the internal-revenue agent and examiner learns 
in the course of his investigation cannot be reported to anyone. As 
a matter of fact, the only reason I can talk here about any cases 

Mr. EoBiNsoN. This is merely hearsay. But there was a kidnap- 
ing case in Chicago in which, I understand, there was $75,000 ransom 
paid. That was reported in the return. 

]\Ir. BiRCHER. As income by the recipients 

Mr. Robinson. And the internal-revenue agent knew that the tax 
was paid on that, I understand. 

Mr. BiRCHER. Yes. I don't doubt that. As a matter of fact, here 
in this area I had a tax case against Sidney Graves several years ago, 
the former chairman of the county board of supervisors here. He 
was convicted in the State court here on cliarges of receiving $80,000 
bribe in connection with the settlement of some litigation involving 
the building of a dam here for the county. He took the $80,000 bribe. 
He didn't report it for tax purposes. I talked to him in the peniten- 
tiary and asked him if he didn't want to straighten it out and pay tax 
on that bribe. He wouldn't pay tax on it. He wouldn't admit that he 
got it. But I proved that he got it — I even went farther than the 
State did in tracing the handwriting and so forth — so when he got 
out of the penitentiary I presented it down in court. They indicted 
him again on tax evasion based on the $80,000 bribe he got. We sent 
him back to the penitentiarv for 2 more years. That is because he 
didn't report the $80,000 bribe. 

Mr. Halley. Is there any specific information relative to organ- 
ized crime, criminal activities in this area, getting away from these 
things and going back ? 

Mr. BiRCHER. No; I really loiow probably less than most anyone. 
I don't like that sort of thing. 

Mr. Halley, When you had the Bugsy Siegel investigation, was 
the field investigation conducted by your office? 

Mr. BiRCHER. Yes. 

Mr, Halley. Did you go out and try to find his assets ? 

Mr, BiRCHER. Yes. I made an intensive investigation. 

INIr. Halley. You wanted to make that an acid case ? 

Mr. BiRCiiER. I traced Bugsy Siegel back to when he first made his 
money bootlegging. He was 21, almost a baby, back in 1921 to 1928, 
when he made all his money in garages bootlegging in New York, 
Then he didn't report much, if any, income during that period. 

So the internal-revenue agent who resigned from the service and 
who lived up in Boston got in touch with him and told him he should 
report all that income he had; so this former agent prepared a delin- 
quent return for him and reported $000,000 or $800,000 and paid a 
terrific taxable profit. So then Bugsy Siegel moved to Los Angeles, 
and he invested $200,000 in stock, in some commodities in the pur- 
chase of stocks. He lost all that money. 

Then some of the other money he invested in different wa3^s. He 
told me that he paid tax on more income than he actually received 
when he was paying tax on about $20,000 a year. 



336 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You don't believe that Bugsy Siegel ever lived on 
as little as $20,000 a year ; do you ? 

Mr. BiRCHER. No ; I don't think so. He had quite a bit of money. 

Senator Tobey. Did you ever run into Virginia Hill ? 

Mr. Bircher. I never met her, but I have checked into her back- 
ground and some of her connections with the people in Chicago and 
her home down in Miami Beach. Some of those reports trickled 
through me, but I didn't have much to do with them. In fact, they 
started a gangster or racketeer squad to handle those things in the 
Bureau of Internal Eevenue, in the Intelligence Unit, about 3 or 4 
years ago, and the man — one of the special agents in the Intelligence 
Unit in New York City was placed in charge to make some prelimi- 
nary survey to see if there was organized crime in connections between 
one city and another. 

So we sent all our papers on Bugsy Siegel and Virginia Hill and 
Tony Cornero. I checked all the gambling ships, Tony Cornero's 
gambling ships, the Lux and the Rex, and all those people years ago. 
But I haven't had any contact with that type of thing for more than 
10 years. 

Mr. Robinson. In connection with your examination of Siegel's 
financial affairs, did you ever encounter a $25,000 loan from Siegel 
to Cohen? 

Mr. Bircher. I never did. 

I might say this: that when I retired from the service I always 
had a good reputation and I didn't know just what you wanted. It 
is true that I have accumulated several lots and things, if that is what 
you folks are interested in. I have purchased a number of lots over 
many years on a tax sale from the county; paid $10 or $20 on them 
as a result. I have a lot assessed to me on that account, but I don't 
have any more than just equities and possible equities in that. 

Senator Tobey How long do they have to redeem those tax sales ? 

Mr. Bircher. The State legislature in this State has stated that 
once they have a tax sale and you get the deed there is no redemp- 
tion. However, the title-insurance companies will not insure your 
title until after you have held it a year, then for a $50 fee, a $50 
hazard fee, they will insure your title. 

TESTIMONY OF FRANK BOMPENSIERO, SAN DIEGO, CALIF. 

The Chairman. Mr. Bompensiero, do you solemnly swear that the 
testimony you will give this committee is the truth, the whole truth, 
and nothing but the t,ruth, so help you God? 

Mr. Bompensiero. I do. 

Mr. Halley. What is your address ? 

Mr. Bompensiero. 5878 Estelle, San Diego, Calif. 

Mr. Halley. What is your business address ? 

Mr. Bompensiero. 1028 Third Avenue. 

Mr. Halley. San Diego ? 

Mr. Bompensiero. San Diego. 

Mr. Halley. In what business are you ? 

Mr. Bompensiero. I own a cafe. 

Mr. Halley. Do you have any other business? 

Mr. Bompensiero. No, sir. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 337' 

Mr. Halley. How long have you owned the cafe? What is its 
name, first ? 

Mr. BoMPENSiERO. Gold Rail. 

Mr. Halley. How long have you owned it ? 

Mr. BoMPENSiERO. I should say about 5 years. 

Mr. Halley. Were you ever convicted of a crime? 

Mr. BoMPENSiERO. dnce ; yes, sir. 

Mr. Halley. Will you state what that was and when? 

Mr. BoMPENSiERO. I was around 23 years old and it was during 
prohibition. It was a liquor case, I guess. I am sure it was. 

Mr. Halley. You were convicted of a liquor violation ? 

Mr. BoMPENSiERO. Yes. 

Mr. Halley. In what State? 

Mr. BoMPENSiERO. California. San Diego County. 

Mr. Halley. Were you ever arrested on any other occasion? 

Mr. BoMPENSiERO. Yes ; I have. 

Mr. Halley. For what oif ense or offenses ? 

Mr. Bompejstsiero. Wetl, I w411 tell you. I was arrested for murder 
once. 

Mr, Halley. In what yearf 

Mr. BoMPENSiERo. I think it was — I don't know" if it was 1941, late- 
in 1941. It was 1941 ; I can't recall it. 

Mr. Halley. In San Diego? 

Mr. BoMPENSiERo. No, sir. 

Mr. Halley. Where? 

Mr. BoMPExsiERO. In Los Angeles. 

Mr. Halley. In connection with what murder ? 

Mr. Bompensiero. I didn't know anything about it. I don't even- 
know what murder it was. 

Mr. Halley. How long were you held ? 

Mr. Bompensiero. About 3 days. 

Mr. Halley. Was the charge dismissed ? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. On any other occasion were you arrested ? 

Mr. Bompensiero. After I got out of the Army I borrowed an auto- 
mobile and I was driving — I left my home, going down to work; T 
was speeding, I guess, a little bit, and they stopped me. There was 
a gun in the glove compartment and they arrested me, but later the 
owner of the car claimed the gun, which was his, and they dismissed 
it. I 

Mr. Halley. Did the owner have a license for the gun? 

Mr. Bompensiero. That I don't know, sir. 

Mr. Halley. But the charge as to you was dismissed? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. Were you arrested on any other occasion? 

Mr. Bompensiero. I was arrested about 4 months ago for not paying 
a ticket. It was a $5 ticket. I forgot to pay it and they took me down, 
there. It cost me $10. 

Mr. Halley. Any other arrests? 

Mr. Bompensiero. Not since, sir. 

Mr. Halley. Do you have any partners in your business? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. Who are they? 



'338 ORGANIZED CRIME IN INTERSTATE COIVIMERCE 

Mr. BoMPENSiERO. It is Frank Dragna and Louis Dragna. 

Mr. Halley. They are related to Jack Dragna ? 

Mr. BoMPENSiERO. One is the son of Jack Dragna and one is a 
nephew. 

Mr. Halley. When did they become your partners ? 

Mr. Bompensiero. Since the first day we bought the phice. 

Mr. Halley. What capital did you contribute and what capital did 
they contribute? 

Mr. Bompensiero. I contributed $12,000. I have one-third. The 
place cost $38,000 at the time. 

Mr. Halley. You put $12,000 in? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. x\nd they put the balance ? 

Mr. Bompensiero. Yes, sir. 
. Mr. Halley. How old is Jack Dragna's son? 

Mr. Bompensiero. He is about 26 years old. At the time he was 
out of the Army, I couldn't say. He was over 21, I am sure. He 
had to be over 21. 

Mr. Halley. And the other boy ? 

Mr. Bompensiero. I don't know. He is around 30 now. I couldn't 
say. 

Mr. Halley. Who put the money up for them ? 

Mr. Bompensiero. I don't know. 

Mr. Halley. Was it their money or Jack Dragna's ? 

Mr. Bompensiero. That I wouldn't know, sir. 

Mr. Halley. Has Jack Dragna showed an interest in the business ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Does he come down and look it over ? 

Mr. Bompensiero. If he has come over he has got no way to look 
into the business at all. 

Mr. Halley. You met them through Jack Dragna; did you not? 

INIr. Bompensiero. I knew the kids for a long time. Yes, I did. 

Mr. Halley. You knew Jack Dragna before you knew the kids? 

Mr. Bompensiero. Oh, yes. 

Mr. Halley. How long have j'ou known Jack Dragna ? 

Mr. Bompensiero. Quite a few years. 

Mr. Halley. Have you ever had any business relations with him ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. At no time with him? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Have you lived in San Diego all your life ? 

Mr. Bompensiero. I lived there for 28 or 30 years. 

Mr. Halley. Yes. 

Mr. Bompensiero. I came from the State of Wisconsin. 

Mr. Halley. Where were you born ? 

Mr. Bompensiero. Milwaukee, Wis. 

Mr. Halley. You lived there until you came here ? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. In what business were you in in Wisconsin? 

Mr. Bompensiero. I was just working in a factory, A. O. Smith. 

Mr. Halley. What kind of a plant was it? 

Mr. Bompensiero. They make automobile parts. 

Mr. Halley. And that was your only occupation until you came 
here? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 339 

Mr. BoMPENSiERO. Yes, sir. 

Mr. Halley. What was your occupation when you came to San 
Diego ? 

Mr. BoMPENSiERO. I used to fish for a living. 

Mr. Halley. For how long did you do that i 

Mr. BoMPENSiERO. I do not — I did that for about, I should say, 
about, maybe, a year. 

Mr. Halley. Then what did you do? 

Mr. Bompensiero. Then I started selling a little liquor and I got 
caught at it. 

Mr. Halley. Who were your associates in the liquor business ? 

Mr. Bompensiero. I was by myself. 

Mr. Halley. Did you know Dragna at that time? 

Mr. Bompensiero. At that time ; no, sir. 

Mr. Halley. When did you first meet Dragna ? 

Mr. Bompensiero. About 1927. 

Mr. Halley. Well, then, that was before your liquor conviction; 
was it not ? 

Mr. Bompensiero. Yes, it was. Yes, sir ; before my liquor convic- 
tion. 

Mr. Halley. Were you still living in Wisconsin when you met 
Dragna ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Then you are here 

Mr. Bompensiero. I came out here, I guess, it must have been 1926. 

Mr. Halley. Now, do you know Joe Sica ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. You have never met him? 

Mr. Bompensiero. Never met him. 

Mr. Halley. What was your business after the prohibition con- 
viction ? 

Mr. Bompensiero. With me ? 

Mr. Halley. Yes. 

Mr. Bompensiero. I was working here and there. 

Mr. Halley. Doing what ? 

Mr. Bompensiero. Well, fishing once in a while ; peddling fish for 
myself. 

Mr. Halley. Any other businesses ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Were you ever in any gambling business ? 

Mr. Bompensiero. Once, before I got in the Army, I tried to get a 
job in La Jolla in a gambling house there, and as I get in there, the 
same night they opened, the place got arrested, and I never got the 
job. So I was never in the gambling business in all my life. 

Mr. Halley. How did you happen to meet Dragna ? 

Mr. Bompensiero. I met him in San Diego through — he used to 
come down to my mother-in-law's. That time they weren't my mother- 
in-law's, but that is where I met him. 

Mr. Halley. Do you know Momo Adamo ? 

Mr. Bompensiero. I met him about 3, 4 years ago, about 5 years ago 
in San Diego. He come into my bar to buy a couple of drinks. 

Mr. Halley. Who brought him in? 

Mr. Bompensiero. Just walked in. 



340 ORGANIZED CRUVIE IN INTERSTATE COMMERCE 

Mr. Haiaey. Have you had any business dealings with Adamo I 

Mr. BoMPENSiERO. No, sir. 

Mr. Halley. Were you in Tia Juana this year ? 

Mr. BoMPENSiERO. Yes, sir. 

Mr. Halley. In February? 

Mr. BOMPENSIERO. Yes, sir; well, I wouldn't say the exact month,, 
but I go down there just about, maybe, once a week, and I go down 
there to have dinners. 

Mr. Halley. To have dinners ? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. You have friends there ? 

Mr. Bompensiero. No ; my wife and I just go down there to Imve 
dinner. 

Mr. Halley. Just eat there ? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. Do you stay overnight or do you come back ? 

Mr. Bompensiero. No, sir ; come back the same night. 

Mr. Halley. Do you know Frank Coppala, "Three-Finger Frank"?' 

Mr. Bompensiero. I met him there. 

Mr. Halley. In Tia Juana ? 

Mr. Bompensiero. In this restaurant, the Caesar restaurant. 

Mr. Halley. Who runs the Caesar restaurant? 

Mr. Bompensiero. K fellow by the name of Jimmie Matiotti, and; 
he has got a partner there. 

Mr. Halley. Will you spell that Matiotti ? 

Mr. Bompensiero. I can't spell it. I only went to third grade. I 
haven't got too much education. 

Mr. Halley. Do you know 

The Chairman. Is this Coppala the one from Kansas City ? 

Mr. Robinson. C-o-p-p-a-l-a. 

Mr. Halley. Do you know Carollo ? 

Mr. BoMPENbiERo. I met him at that restaurant. 

Mr. Halley. With Coppala? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. They were both there together? 

Mr. Bompensiero. At that time, yes, sir ; while we were drinking.. 

Mr. Halley. Do you know Anthony Lapiparo ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Have you never met him ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. You know 

Mr. Bompensiero. Spell the name again, sir. 

Mr. Robinson. Lapiparo, from St. Louis. 

Mr. Bompensiero. Just a minute. You misspelled it, sir. 

Mr. Halley. Lapiparo? 

Mr. Bompensiero. That is right. I met him there at the same- 
restaurant. 

Mr. Halley. Was he there that same night with all the others ? 

Mr. Bompensiero. It was various nights. I go down there once or 
twice a week when I can take off that length of time to go for dinner. 
That is where I go. I never eat in San Diego. 

Mr. Halley. Was a fellow named Lococo there? 

Mr. Bompensiero. Who? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 341 

Mr. Halley. Antonino Lococo ? 

Mr. BoMPENSiERO. I don't know him. 

Mr. Halley. You may know him by the name of Daparisto. 

Mr. Bompensiero. No, sir. 

Mr. Halley. How about Bartolino ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Carlo Sciotarno? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Giuseppe Caruso? 

Mr. Bompensiero. I believe not. 

Mr. Halley. Gallo ? 

Mr. Bompensiero. Gallo? Yes. 

Mr. Halley. What did you discuss with Coppala and Carollo ? 

Mr. Bompensiero. Not a thing, sir. I was drinking. 

Mr. Halley. You were just drinking? 

Mr. Bompensiero. That is all, sir. 

Mr. Halley, Were you drinking with them ? 

Mr. Bompensiero. No, I got in there with my wife and we had a 
few drinks at this — the owner of this place said, "There is a couple of 
Italian fellows," and he introduced me to them. I bought them a 
couple of drinks and they did the same with me. 

Every time I would go down there they would find me down there. 

Mr. Halley. Did you ever go down there with Tony Marobli ? 

Mr. Bompensiero. Yes ; once or twice a year, maybe. 

Mr. Halley. What is his business ? 

Mr. Bompensiero. He owns a cafe. 

Mr. Halley. What cafe? 

Mr. Bompensiero. Rainbow Gardens. 

Mr. Halley. Where is that ? 

Mr. Bompensiero. That is on Fourth and F. 

Mr. Halley. San Diego? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. Have you ever had any business dealings with him? 

Mr. Bompensiero. No, sir. 

Mr. Halley. At no time ? 

Mr. Bompensiero. At no time. 

Mr. Halley. Have you ever had any business dealings with either 
Carollo or Coppala ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Have you ever handed them money ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Are you sure ? 

Mr. Bompensiero. You mean hand to hand, hand them money ? I 
never did. 

Mr. Halley. For any purpose whatsoever ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Have you ever had a bet with them ? 

Mr. Bompensiero. I don't bet. I don't gamble, sir. Please believe 
me. 

Mr. Halley. How did you hap]:)en to meet these people? 

Mr. Bompensiero. I told you I met them down there. I go down 
there once or twice a week, and this fellow said, "There is a couple of 
Italian fellows down there." So I bought them a drink and they 
bought a drink back, and so then 



342 ORGAXIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. How did you meetLapiparo? ■ ^ 

Mr. BoMPENSiERo. The same way, sir. 

Mr. Halley. Did you ever know Charley Binnagio ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Did you ever know Carlo Marcella? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know Gino Genevese ? 

Mr. BoMPi:::siERO. Who? 

Mr. Halley. Vito Gino Genevese. 

Mr. Bompensiero. Never heard of him. 

Mr. Halley. Do you know Vincent Profissa? 

Mr. Bompensiero. Never heard of him. 

Mr. Halley. Never heard of him? 

Mr. Bompensiero. In the newspapers and stuff like that, but as tcv 
knowing him, never heard of him. 

Mr. Halley. Did you ever speak to him on the telephone? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know Tony Gizzo ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. You never met Tony Gizzo ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know who he is ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know a man named Charles Balstraya or 
Frank Balstraya? 

Mr. BoMPENiERO. Out of Milwaukee? 

Mr. Halley. No ; out of Kansas City. 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know any of the Vischettis in Chicago ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Tony Arcardo ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Do you know Joe Adonis ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. Were you ever arrested in Tia Juana ? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. Weren't you taken in by the TiaJuana officials for 
investigation ? 

Mr. Bompensiero. The only place I have been arrested is in the 
United States of America ; in no other country. I read that in Drew 
Pearson's column myself and I was surprised. 

Mr. Halley. Is it your testimony that you have never had any busi- 
ness whatsoever with these people? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. You meet them in this bar in TiaJuana? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. What is the name of the bar ? 

Mr. Bompensiero. Caesar's bar cafe, restaurant — Caesar's. 

Mr. Halley. Has Jack Dragna ever gone to Caesar's bar with you ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. When did you first start going to Caesar's bar? 

Mr. Bompensiero. About 2 years ago, while he was building it. 
He used to have Marianna's first, and I used to go there once in a. 



ORGANIZED CRIME IN INTERSTATE COMIMERCE 343' 

while and he sold out there and he started building this place, and I 
kind of followed him. He is a pretty fair fellow. 

ISIr. Halley. How long have you known Caesar ? 

Mr. BoMPENSiERO. Not Caesar — 3'ou mean Jimmie? 

Mr. Halley. Yes. 

Mr. Bompensiero. About 4 years altogether. 

Mr. Halley. What is Jimmie's last name? 

Mr. Bumpensiero. Jimmie Matiotti. 

Mr. Halley. Who introduced you to Matiotti ? 

Mr. B031PENSIER0. I just dropped in. I heard of their good food 
and I just dropped in there. 

Mr. Halley. Do you know Tony Lococo ? 

Mr. BoMPENSiERO. No, sir. 

Mr. Halley. He comes from Kansas City. 

Mr. BoMPENSiERO. I don't know him, sir. 

Mr. Halley. Do you know Tony Marablis ? 

Mr. BOMPENSIERO. Yes, sir. 

Mr. Halley. Who is he ? 

Mr. Bo:mpexsiero. He is a cafe owner. 

Mr. Halley. Where? 

Mr. BoMPENSiERO. San Diego. 

Mr. Halley. You never met Charlej^ Binnagio ? 

Mr. BoMPENSiERO. No, sir. 

Mr. Halley. You never discussed him with the group that you met 
in San Diego — in Tiajuana? 

Mr. Bompensiero. Which group ? 

Mr. Halley. With Coppala and Carolla. 

Mr. Bompensiero. Why should I discuss it with anybody ? I don't 
know any groups. 

Mr. Halley. Did the name of Binnagio ever come up? 

Mr. Bompensiero. No, sir ; not with me. It never did. 

Mr. Halley. What did you folks talk about ? 

Mr. BoiiPENSTERO. Just drinking. I didn't have no business with 
them. I only waste an hour or two down there. I had a couple drinks 
before dinner. An hour or two after dinner I leave. 

Mr. Halley. What did you have in common with this group of 
people ? 

Mr. Bompensiero. Nothing; I don't even know them. 

jSIr. Halley. But you like to go down and sit around and eat with 
them ? 

Mr. Bompensiero. I would go to the bar and have a couple of drinks 
and my wife and I would eat. 

Mr. Halley. You would stand at the bar and talk to them ? 

Mr. Bompensiero. No, sir. 

Mr. Halley. You did talk to them ? 

Mr. Bompensiero, While I was having a drink or two. 

Mr. Halley. W^hat did you talk about ? 

Mr. Bompensiero. Various things; nothing that would mean any- 
thing because I have my own business to take care of. 

Mr. Halley. Did you at any time ever give or receive any sum of 
money to any of these people or from any of these people ? 

Mr. Bompensiero. No, sir. 



344 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Hallet. I refer specifically to Carolla, Coppala, Lococo, Lapi- 
paro, and Caruso. 

Mr. BoMPENSiERO. No ; Lapiparo once ; I sent liim $200. 

Mr. Halley. Who? 

Mr. BoMPENsiERO. I did. 

Mr. Halley. Which one? 

Mr. BoMPENSiERO. Lapiparo. 

Mr. Halley. Lapiparo ? 

Mr. BoMPENsiERO. Yes, sir. 

Mr. Halley. When did you send him $200 ? 

Mr. BoMPENsiERO. He come into the bar and he was going to San 
Francisco, or to Bay Meadows there, and he sent me a telegram from 
there that he was broke, so I sent him $200. 

Mr. Halley. Where did he send you the telegram ? 

Mr. BoMPENsiERO. To the Gold Rail. 

Mr. Halley. How long had you known Lapiparo ? 

Mr. Bompensiero. About, I should say — I imagine about 3, 4 weeks. 

Mr. Halley. He must have felt that you were a good friend of his 
to ask for $200. 

Mr. Bompensiero. Not necessarily. I loan money in the bar all the 
time to customers, and he come in and spend a little money down there, 
and he promised to send it back, which he did. 

Mr. Halley. Did he ever intimate to you what they were doing 
there? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. Do you know what Lapiparo's business is in St. 
Louis ? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. Did you ever hear of the Anthony Amusement Co. ? 

Mr. Bompensiero. He talked about it, yes. 

Mr. Robinson. Isn't that his business? 

Mr. Bompensiero. I don't know if it is or not. He talked about it. 

Mr. Robinson. Did any of these individuals indicate to you what 
they were doing in Tiajuana at this particular time? 

Mr. Bompensiero. No, sir. 

Mr. Halley. They just happened to be there? 

Mr. Bompensiero. Yes, sir. 

Mr. Halley. And you just happened to go down at that particular 
moment ? 

Mr. Bompensiero. I go down twice a week. I still go down there. 

Mr. Halley. Was there any prearrangement about your meeting 
them down there ? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. Two more questions. You know Jasper Matranga ? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. Joe Depolita? 

Mr. Bompensiero. No, sir. 

Mr. Robinson. The Vitalli brothers, in Oceanside? 

Mr. Bompensiero. Yes, sir. 

Mr. Robinson. What was the nature of your acquaintance with 
them ? 

Mr. Bompensiero. Just know that they own a bar, and either they 
drop in once in a while and buy a drink in my place, and if I happen 



ORGANIZED CRIME IN INTERSTATE COMMERCE 345 

to be in Los Angeles and on my way downtown — and on the way dowm, 
I stop in and bny a drink there. 
Mr. Robinson. Do you know Frank Russo in Oceanside ? 

Mr. BOMPENSIERO. No. 

Mr. Robinson. John Russo, in San Berdardino? 

Mr. BoMPENSiERO. No, sir. 

Mr. Robinson. Dr. Irata in San Diego? 

INIr. BoMrEXSiERo. No, sir. Never met him. - 

The Chairman. Have you ever been in the narcotics business? 

Mr. BoMPENSiERO. No, sir. 

Tlie Chairman. Ever have anything to do with it ? 

Mr. BoMPENSiERO. No, sir. 

Mr. Halley. You will remain under subpena. 

The Chairman. If we want you back, we will let you know. 

TESTIMONY OF JAMES UTLEY, HOLLYWOOD, CALIF. 

The Chairman. Mr. Utley, 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. Utley. I do. 

Mr. Halley. Where do you live ? 

Mr. Utley. 6108 Dundee Place, Hollywood, Calif. 

Mr. Halley. Do you luive a business address ? 

Mr. Utley. Not at the present time. 

Mr. Halley. Do you have any business ? 

Mr. Utley. Not at the present time. 

Mr. Halley. None whatsoever ? 

Mr. Utley. No. 

Mr. Halley. Were you ever arrested ? 

Mr. Utley. Yes. 

Mr. Halley. Were you ever convicted of a crime? 

Mr. Utley. Yes. 
■ Mr. Halley. What convictions ? 

Mr. Utley. Narcotics conviction, in 1937, I think. 

Mr. Halley. What was that, a narcotic conviction ? 
' Mr. Utley. Yes, sir. 

Mr. Halley. Where ? 

Mr. Utley. Los Angeles. 

Mr. Halley. You were sentenced to serve 2 years ? 

Mr. Utley. Correct. 

Mr. Halley. Did you serve them ? 

Mr. Utley. Yes. 

Mr. Halley. Were you convicted with anyone else, or were you 
alone ? 

Mr. Utley. Alone. 

Mr. Halley. Alone? 

Mr. Utley. Yes. 

Mr. Halley. For selling or possession? 

Mr. Utley. Both. 

Mr. Halley. And have you any other conviction? 

Mr. Utley. No. 

Mr. Halley. I see you were arrested first in Birmingham, Ala.; 
is that right ? 

68958—51— pt. 10 23 



346 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Utley. I thiiik it is correct. 

The Chairman. Did you come from Alabama ? 

Mr. Utley. I was just traveling through there with one of these 
carnival shows. You might say that. 

Mr. Halley. You were arrested in Arkansas ? 

Mr. Utley. Yes ; for suspicion. 

Mr. Halley. And then you have been arrested on suspicion of 
robbery here? 

Mr. Utley. Yes. 

Mr. Halley. And suspicion of narcotics here in 1937 and on that 
you were finally convicted ; is that right ? 

Mr. Utley. Correct. 

Mr. Halley. In 1937 you were arrested on suspicion of pimping; 
is that right? 

Mr. Utley. Yes. 

Mr. Halley. No conviction? 

Mr. Utley. No. 

Mr. Halley. Discharged? 

Mr. Utley. No charges filed. 

Mr. Halley. No charges filed. In 1939 for extortion and kid- 
naping ? 

Mr. Utley. No charges filed. 

Mr. Halley. There is something here about a bond. You must 
have had a charge filed in 1939. 

JVIr. Utley. Oh, there was a charge filed and I was exonerated. 

Mr. Halley. You were exonerated ? 

Mr. Utley. Yes. 

Mr. Halley. Then in 1939 you were arrested on a narcotics viola- 
tion ; is that right ? 

Mr. Utley. That is the same violation. They originally arrested 
me in 1937, and then didn't take any action on it for 2 years, and after 
a period of 2 years they decided to take action on the narcotics charge. 
There was no foundation to the charge originally. 

The State originally had the charge and they finally turned it over 
to the Government for prosecution because the State felt they couldn't 
get a conviction on it, using the Government as a means, because — as 
a front for respectability, you might say. People might believe the 
Government more than they would the State. 

The Chairman. Anyway, you got convicted in 1939 ? 

Mr. Utley. Yes. 

Mr. Halley. Now, in 1944 were you arrested in connection with 
suspicion of receiving stolen jewelry? 

Mr. Utley. No. 

Mr. Halley. Did you have any charge against you in connection 
with second-hand jewelry or w\as that a license application? 

Mr. Utley, I think that was a license application. I had a jewelry 
store at the time. 

Mr, Halley. You needed a license to handle second-hand jewelry? 

Mr. Utley. Correct. 

Mr, Halley. That was the jeweliy store you had with Mickey 
Cohen? 

Mr. Utley. I never had any business of any nature with Mickey 
Cohen. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 347 

Mr. Halley. You sold that one to Mickey, did you not ? 
Mr. Utley. No, sir ; I did not. 
Mr. Halley. Where was it located? 

Mr. Utley. At 6109 Hollywood Boulevard. I am quite sure that is 
the correct address. 

Mr. Halley. You were arrested for criminal conspiracy in 1946 ; is 
that right? 

Mr. Utley. I think so. 

Mr. Halley. What was that charge in connection with ? 

Mr. Utley. I don't know. It is one of these pick-up charges that 
they just book you on and they turn you loose. I don't remember 
exactly what it is. It wasn't important, I don't think. 

Mr. Halley. What business have you been in in the last 2 years ? 

Mr. Utley. In the amusement business. 

Mr. Halley. What forms of the amusement business ? 

Mr. Utley. Bridgo game of amusement. 

Mr. Halley. Is that a gambling game ? 

Mr. Utley. No ; it is licensed by the city of Los Angeles. 

Mr. Hauley. Have you operated any gambling games in the last 2 
years ? 

Mr. Utley. I have not. 

Mr. Halley. Have you ever been in the gambling business? 

Mr. Utley. Quite a few years back. 

Mr. Halley. When were you in the gambling business ? 

Mr. Utley. 1936, 1937. 

Mr. Halley. Where and under what conditions ? 

Mr. Utley. I was in the bookmaking business on Santa Monica 
Boulevard. 

Mr. Halley. Did you have any associates in that business? 

Mr. Utley. No, myself. 

Mr. Halley. You were all by yourself? 

Mr. Utley. Yes. 

Mr. Halley. Did you have wire service ? 

Mr. Utley. Yes, I did. 

Mr. Halley. From whom did you get it ? 

Mr. Utley. It is 14, 15 years ago. I don't remember. 

Mr. Halley. Why did you go out of the bookmaking business? 

Mr. Utley. I went into the amusement business. 

Mr. Halley. By "the amusement business" you refer to this Bridgo'? 

Mr. Utley. That is correct. 

Mr. Halley. Wliere did you operate? 

Mr. Utley. In Venice; that is in the city limits of Los Angeles, 

Mr. Halley. Where else have you operated the Bridgo ? 

Mr. Utley. I have operated in San Mateo County. I have operated 
in Stockton. I have operated in Imperial, Calif. 

Mr. Halley. The Los Angeles Police Department has shut down 
your Bridgo; is that right? 

Mr, Utley. That's correct. 

Mr. Halley. They contend it is a gambling game ; isn't that correct ? 

Mr. Utley. That is the police department's version of it. 

Mr. Halley. You have said that it is not? 

Mr. Utley. The court has ruled — the original ruling on this game 
as high as the circuit court of appeals that the game is a legal game. 

Mr. Halley. How does Bridijo work? 



348 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Utley. Well, first they throw balls at chips and if they get 
five in a row some way, or so forth, they win a prize. That is called 
Bridgo. 

Now, after they have played a game of Bridgo, then they play 
cards, which are Bingo cards. You have seen them. They play Bingo 
anywhere. For that there is no charge. The people that participate 
in the game of Bridgo usually sit there and play the other game free, 
which they win prizes for. 

Senator Tobey. Where do you get your money, then ? 

Mr. Utley. We get our money on what we charge for the game of 
skill conducted with this game. 

Mr. Halley. Do you mean the Bridgo ? 

Mr. Utley. The Bridgo ; yes, sir. 

Mr. Halley. And for how many years did the police department 
accept the story that that was legal ? 

Mr. Utley. For 10 years, 9 or 10 years. 

Mr. Halley. The game of Bingo is free 

Mr. Utley. They recently decided it was not legal. 

Mr. Robinson. I think I can probably clarify it. When the city of 
Venice consolidated and became a part of the city of Los Angeles, 
part of the consolidation agreement stipulated that the police officials 
would do nothing to interfere with games of skill at the beach. So that 
this Bridgo, it was contended, was a game of skill, and if a person 
made Bingo and paid for the cost of playing Bridgo they were entitled 
to these free Bingo cards. 

Mr. Utley. That is correct ; exactly right. It was agreed between 
Venice and the city of Los Angeles at the time that it came into the 
corporation of Los Angeles that games will be played there that 
they would not allow in any part of Los Angeles. 

Mr, Halley. How long were you operating in Venice before the 
incorporation in Los Angeles ? 

Mr. Utley. I was not operating before then. 

Mr. Halley. You were not at all ? 

Mr. Utley. No; I used to work for other people there. 

Mr. Halley. In Venice ? 

Mr. Utley. Yes. 

Mr. Halley. For whom did you work ? 

Mr. Utley. I worked for a man by the name of Gordon, Sam Gor- 
don, who had one of those places years ago, maybe 18, 19 years ago. 

Mr. Halley. Wlio are your associates in your business? 

Mr. Utley. Irving Glasser. 

Mr. Halley. Do you have any other associates ? 

Mr. Utley. Yes; Phil Tapper 

The Chairman. Who? 

Mr. Utley. Phil Tapper, T-a-p-p-e-r. 

Mr. Halley. Any others? 

Mr. Utley. Max Klieger. 

Mr. Halley. Wliat other businesses do you have ? 

Mr. Utley. I have no other businesses. 

Senator Wiley. How much money have you got invested in this 
business ? 

Mr. Utley. I should judge my share would amount to $35,000, 
$40,000. I couldn't give you an accurate figure. It is over a period 
of 9 or 10 years, so I couldn't be very accurate on the figures. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 349 

Senator Wilet. What proportion do you have ? 

Mr. Utley. I have a very small percentage. 

Senator Wiley. Five percent ? 

Mr. Utley. Thirteen percent. 

Mr. Halley. What percentage do the others have? 

Mr. Utley. Well, to the best of my knowledge, I think Mr. Glasser 
has 18. His wife, I think, has some. Mr. Glasser is in charge of the 
business. It is licensed under his name, and I don't know exactly 
how it is portioned out. 

Mr. Halley. What is your function in the business ? 

Mr. Utley. I was in charge of operations. 

Mr. Halley. At what point, what place physically ? 

Mr. Utley. Well, at the Fortune. 

Mr, Halley. Where is the Fortune located ? 

Mr. Utley. It is located at 1501 Ocean Front, Venice. 

Mr. Halley. Is there any hotel or inn connected with it? 

Mr. Utley. No. 

Mr. Halley. Or any tavern ? 

Mr. Utley. No. 

Mr. Halley. It is purely a 

Mr. Utley. A room for amusement purposes only. 

Mr. Halley. For this game ? 

Mr. Utley. Yes. 

Mr. Halley. Were you in charge at any other occasion ? 

Mr. Utley. For a short time. 

Mr. Halley. Where? 

Mr. Utley. At another location on the Colder Rose Bridge. I don't 
remember the exact address right now. 

Mr. Halley. How many locations do you operate at ? 

Mr. Utley. I was interested in three locations. 

Mr. Halley. Which were they? 

Mr. Utley. Fortune, the Surf 

Mr. Halley. S-u-r-f ? 

Mr. Utley. And the Eose. 

Mr. Halley. When did you first meet Glasser? 

Mr. Utley. Oh, probably 15, 16 years ago. 

Mr. Halley. What is his business ? 

Mr. Utley. Bail-bond business. 

Mr. Halley. Have you any interest in the bail-bond business ? 

Mr. Utley. No ; I do not. 

Mr. Halley. When did you first meet your other associates ? 

Mr. Utley. I have known them all for 15 or 20 years. 

Mr. Halley. Wliat businesses are they in ? 

Mr. Utley. Some of them are in the bond business. 

Mr. Halley. Were any in the bookmaking business? How about 
Phil Tapper? 

Mr, Utley. Well, I couldn't make a definite statement as to his 
business. 

Mr. Halley. What business did you think he was in? 

Mr. Utley. If it is a matter of hearsay, I would say he was in the 
bookmaking business. 

Mr. Halley. Did you ever talk to him about what business he had 
been in ? 



350 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Utlet. Little discussions about bookmaking. I assumed he 
was bookmaking. But I couldn't say. 

Mr. Halley. That was the impression you had from your talk with 
him ; is that right ? 

Mr. Utley. That is right. 

Mr. Halley. What business had Klieger been in ? 

Mr. Utley. He has been in several concessions of amusements at 
the pier at Santa Monica, and he also has a bar there. 

Mr. Halley. Has he ever been a bookmaker ? 

Mr. Utley. Not to my knowledge. 

Mr. Halley. Were you ever interested in the Los Flores Inn? 

Mr. Utley. Yes ; I was. 

Mr. Halley. When? 

Mr. Utley. I think it was in 1948. 

Mr. Halley. That is at Del-Mar? 

Mr. Utley. Yes. 

Mr. Halley. It overlooks the track; is that right? 

Mr. Utley. Correct. 

Mr. Halley. What percentage of that operation did you have? 

Mr. Utley. I think there was four of in on that. I am not quite 
sure. There was stock issued in it, and I think I had one share out of 
four shares. 

Mr. Halley. Who were the other three people ? 

Mr. Utley. Irving Glasser, Phil Tapper, and Max Klieger. 

Mr. Halley. Do you know Jack Dragna ? 

Mr. Utley. Yes. 

Mr. Halley. How long have you known Jack Dragna ? 

Mr. Utley. A good many years. 

Mr. Halley. When did you first meet him ? 

Mr. Utley. Probably 15 years ago. 

Mr. Halley. Have you ever had any business dealings with him 
whatsoever? 

Mr. Utley. None whatsoever. 

Mr. Halley. None of any nature ? 

Mr. Utley. None of any nature, 

Mr. Halley. Have you ever had any business dealings with any- 
body who was in the wire-service business, the racing- wire service ? 

Mr. Utley. No ; I have not. 

Mr. Halley. Do you know whether anybody who had any relation- 
ship whatsoever to the racing wire had any connection with the Los 
Flores Inn ? 

Mr. Utley. I do not. 

Mr. Halley. Was the Los Flores used as an observation point for 
getting information from the track? 

Mr. Utley. No. 

Mr. Halley. Are you sure of that ? 

Mr. Utley. Well, if it was used, it was not used with my knowledge. 

Mr. Halley. Were you ever told it w[is used? 

Mr. Utley. No ; I was not. 

Mr. Halley. You have no knowledge of that whatsoever ? 

Mr. Utley. None whatsoever. 

Mr. Halley. Were you ever beaten in a restaurant in Los Angeles? 

Mr. Utley. Yes. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 351 

Mr. Halley. Will you tell the committee when and where that 
happened ? 

Mr. Utley. I don't remember the dates. Yon probably have that 
on your record there, but I can tell you the details if you wish. 

The Chairman. Tell us about when it was. 

Mr. Halley. It was Lucey's Restaurant, wasn't it ? 

Mr. Utley. Yes. 

Mr. Halley. How long ago, approximately? Four or five years? 

Mr. Utley. Yes. 

Mr. Halley. Who hit you there? 

Mr. Utley. I don't know. I was facing — I was sitting at the bar 
and someone hit me from the rear, from the back, right over the back 
of the head here [indicating]. I was dazed. You know, and then 
they kept on hitting me. I could feel them hitting me but I couldn't 
see who it was because I was dazed. 

Senator Tobey. With his fist ? 

Mr, Utley. No, with a gun, and when I went down I could still feel 
him hitting me, and the next thing I knew I was sitting on a daven- 
port, and they sent me an ambulance. They took me to the Hollywood 
Receiving Hospital and they sewed me up. 

Mr. Halley. Were you alone? 

Mr. Utley. In the restaurant ; no. 

Mr. Halley. Who was with you? 

Mr. Utley. Well, I was there by myself but there were several 
people in the restaurant. 

Mr. Halley. Were they people who knew you or were talking to 
you? 

Mr. Utley. Everybody knew me. Most everybody knew me at the 
bar. 

Mr. Halley. Who was standing at the bar near you? 

Mr. Utley. I don't remember. 

Mr. Halley. You have been asked about this a great deal ? 

Mr. Utley. Yes, I have. 

Mr. Halley. Was there anybody at the bar who knew you ? 

Mr. Utley. There might have tieen several people that knew me. 

Mr. Halley. Who? 

Mr. Utley. But I don't remember who was there. 

Mr. Halley. Can't you even give the committee the name of even 
one person who was there? 

Mr. Utley. Well, the owner knew me. He was there. 

Mr. Halley. Who were you talking to? You must have been 
standing there talking to people. 

Mr. Utley. I had just walked in. I hadn't been there 2 minutes. 
It seemed that somebody might have been waiting for me because as 
I approached the bar and got on the stool and ordered a drink — didn't 
even get a chance to talk to anyone — the next thing I knew somebody 
hit me on the head and I was going down. 

Senator Tobey. Did it fracture your skull? 

Mr. Utley. Yes. 

Senator Tobey. How long were you hospitalized? ^ 

Mr. Utley. A few days, and then I went home with a bandage on 
my head. 

Senator Tobey. Then you had no permanent ill results from it? 

Mr. Utley. I don't think so. 



352 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Tobey. Who do you think hit you ? 

Mr. Utley. I have no idea. 

Senator Tobey. Wasn't there somebody there taken as witnesses? 

Mr. Utley. There wasn't anything done about it. 

Senator Tobey. Didn't the bartender see it? 

Mr. Utley. I never asked him. 

Mr. Halley. Were you having any dispute with anybody at the 
time who might have had a reason to hit you ? 

Mr. Utley. No ; not that I can remember. 

Mr. Halley. Were you having any business problems? 

Mr. Utley. None at alL 

Mr. Halley. Are you afraid to give testimony about this matter? 

M'r. Utley. No ; I am not. 

Mr. Halley. You are not? 

Mr. Utley. No. 

Mr. Halley. Were your friends afraid to say who hit you? 

Mr. Utley. Well, that I don't know. If anyone saw me being hit^ 
whether they said anything about it or not, I don't know. 

Senator Tobey. Were you given any warnings not to talk ? 

Mr. Utley. No. 

Mr. Halley. What other businesses have you had in the last 5 years? 
I think you mentioned the Fortune in Venice. 

Mr. Utley. Yes. 

Mr. Halley. What is the Surf in Venice ? 

Mr. Utley. That is a Bridgo place, like the Fortune. 

Mr. Halley. Did you have an interest in that ? 

Mr. Utley. Yes. 

Mr. Halley. Who is' Irene Veebie ? 

Mr. Utley. She is the daughter of a friend of mine. 

Mr. Halley. Does she have a half interest in your share? 

M'r. Utley. She has a certain interest in my share according to the 
amount that was put up by her for the original building of the estab- 
lishment. 

Mr. Halley. How much did she put up ? 

Mr. Utley. I think it was around $5,000. 

Mr. Halley. What is the name of her father ? 

Mr. Utley. James. 

Mr. Halley. Wlio is Allen Handler? 

Mr. Utley. He is an associate of mine that I have known for & 
good many years. 

Mr. Halley. Are you in business with him ? 

Mr. Utley. He is not an associate, I want to correct it. He is an 
acquaintance of mine for a good many years. 

Mr. Halley. How well do you know him ? 

Mr. Utley. I have known him for 20 years. 

Mr. Halley. Wliat business is he in ? 

Mr. Utley. Well, he has a small interest with me in the Bridgo, 

Mr, Halley. In what? 

Mr. Utley. In the Bridgo. 

Mr. Halley. Is he a bookie? 

M'r. Utley. No, sir. 

Mr. Halley. Has he ever been one ? 

Mr. Utley. No, sir. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 353 

Mr. Halley. Has lie never talked to you about the bookmaking 
business ? 

Mr. Utley. No. 

Mr. Halley. You have no knowledge that he is a bookie ? 

Mr. Utley. I don't think he is a bookie. 

Mr. Halley. What share does he have in the Bridgo ? 

Mr. Utley. His proportion of a $5,000 investment with me. 

Mr. Halley. You invested only $5,000 in that ? 

Mr. Utley. No, I invested quite a bit of money, but when I did make 
the investment he invested $5,000 with me. He gets his share. 

Mr. Halley. What did you invest? 

Mr. Utley. Well, from time to time I must have invested over 
$30,000. 

Mr. Halley. Wliat other businesses have you had? 

Mr. Utley. The jewelry business in 1940-something. 

Mr. Halley. How long were you in that ? 

Mr. Utley. I think about 2 years. 

Mr. Halley. Did you sell out? 

Mr. Utley. Yes. 

Mr. Halley. To whom ? 

Mr. Utley. I don't remember the name of the people. 

Mr. Halley. Did you have any partners in the jewelry business? 

Mr. Utley. Yes, I did. 

Mr. Halley. Who? 

Mr. Utley. A man by the name of King, George King. 

Mr. Halley. Does he come from Cleveland ? 

Mr. Utley. No, he lived here, I think, most of his life. 

Mr. Halley. Does he have another name, Angasola ? 

Mr. Utley. No, he is a jeweler. He has been in the jewelry business 
in Los Angeles for at least 15 years that I know of. 

Mr. Halley. What other partners did you have ? 

Mr. Utley. In the jewelry business? 

Mr. Halley. Yes. 

Mr. Utley. None others. 

Mr. Halley. How much did you invest in the jewelry business? 

Mr. Utley. I don't remember exactly. I think around $20,000. 

Mr. Halley. Of your own money ? 

Mr. Utley. Yes. 

Mr. Halley. Cash? 

Mr. Utley. Well, I think it was cash. 

Mr. Halley. What year did you invest that ? 

Mr. Utley. I think it was either 1945 or 1946. 

Mr. Halley. How did you accumulate that? Your income tax 
shows very small income in the early years. 

Mr. Utley. My wife always had a little money. Her mother died 
and left her a bit of money. 

Mr. Halley. How much did her mother leave her ? 

Mr. Utley. Maybe $7,000 or $8,000. 

Mr. Halley. How did you accumulate $20,000 ? 

Mr. Utley. Well, I don't know. At the time maybe I borrowed it 
for the time being. I borrowed a lot of money at times and paid it 
back. 

Mr. Halley. You said it was your own a little while ago. 



354 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Utley. It has been 5 or 6 years. I just don't remember what 
the transaction was, but I know the jewelry store was paid for in cash. 
Where I got the money, right now, I couldn't say. I might have 
borrowed it. 

Mr. Halley. Before you went into the jewelry business, you were 
what, an assistant manager at the Fortune, or manager, or what? 

Mr. Utley. I was manager, 

Mr. Halley. What was your salary? 

Mr. Utley. $100 a week. 

Mr. Halley. And then you were in the Specialty Stitching Co. 
What was that? 

Mr. Utley. It was some kind of a deal that somebody promoted 
me for. I don't remember. I know I lost something on it. It wasn't 
my business, and every time I got into something that wasn't my 
business I usually wound up losing something. 

Mr. Halley. What kind of a business was it ? 

Mr. Utley. We were manufacturing something. 

Mr. Halley. Who is J. J. Gogan ? 

Mr. Utley. Gogan ? I don't remember the name. 

Mr. Halley. Where did you get this cash? You just don't show 
you were earning any particularly large amounts of money in the 
years before you went into this jewelry business. 

Mr. Utley. I don't remember offhand where I got the cash. 

Mr. Halley. Has the Bureau of Internal Revenue investigated you? 

Mr. Utley. Yes, they have, for 1946 and 1947, or whenever it was. 

Mr. Halley. Have they assessed any penalties ? 

Mr. Utt^ey. Yes ; there was an adjustment made. 

Mr. Halley. How much? 

Mr. Utley. I think an additional $2,500 on my tax besides what 
was originally paid. 

Mr. Halley. You reported for 1945 an income of $5,700; is that 
right ? 

Mr. Utley. I don't know. 

Mr. Halley. Do you recall that? 

Mr. Utley. I think that was readjusted. 

Mr. Halley. Upward? 

Mr. Utley. Ui^ward; yes. 

Mr. Halley. And you reported for 1946 an income of only $987. 

Mr, Utley. I don't think that is correct. 

Mr. Halley. It says : "Income reported, $1,987, with a loss of $1,000 
carried over." 

Mr. Utley. I don't think that is correct. 

Mr. Halley. You don't know? 

Mr. Utley. I don't think it is correct. There are some years I had 
better income than that. 

Mr. Halley. You did ? 

Mr. Utley. Yes. 

Mr. Halley. Well, what did you do about the tax on it? How did 
you report it? 

Mr. Utley. I reported whatever my income was. 

Mr. Halley. This doesn't show up here. Did you bring any of your 
own records with you? 

Mr. Utley. No : I did not. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 355 

Mr. Halley. Your income tax? 

Mr. Utley. No ; I did not. 

Mr. Halley. Who is your accountant? 

Mr. Utley. Harry Sackman. 

Mr. Halley. How long has he represented you ? 

Mr. Utley. I think about 3 years. 

Mr. Halley. How did you get to know him ? 

Mr. Utley. He was doing work for Irving Glasser and so I went to 
him. 

Mr. Halley. You mean Glasser introduced you? 

Mr. Utley. Yes. 

Mr. Halley. You say you have no business with Glasser other than 
the Bridgo-Bingo ? 

]Mr. Utley. No. 

Ml'. Robinson. Did you have any connection at all with the Guar- 
antee Finance Co.? 

Mr. Utley. I did not. 

Mr. Robinson. Do you know the president of the Guarantee Fi- 
nance Co.? 

Mr. Utley. An acquaintance. 

Mr. Robinson. Quite well ? 

Mr. Utley. I knew him ; yes. 

Mr. Robinson. You know Marvin Kobey ? 

Mr. Utley. Yes; I do. 

Mr. Robinson. You know Phil Kober ? 

Mr. Utley. Yes; I do. 

Mr. Robinson. Were you ever on the premises of the Guarantee 
Finance Co. ? 

Mr. Utley. Yes ; I was. 

Mr. Robinson. Will you state what that occasion was? 

Mr, Utley, I don't know for sure, I think it was something per- 
taining to a bridgo game that Kobey was running. 

Mr. Robinson. Perhaps I can help you. Do you know Pat Conners? 

Mr. Utley. Yes ; I do. 

Mr. Robinson. Did you ever go to the premises of the Guarantee 
Finance Co. with Pat Conners? 

Mr. Utley. She was in my car and I drove by there and I stopped 
and left her in the car and I went into the finance company. I told 
Kobey, who I had in the car, and asked him if he knew her or knew 
anything about her or whether he had done any business with her, be- 
cause I felt she was contacting me for information or other things. 
He gave me a very low opinion of her, and that is what I wanted to 
know, and I — after I left — I drove her back. 

Mr. Robinson. Did you know at that time the Los Angeles Police 
Department had seized the records of the Guarantee Finance Co.? 

Mr. Utley. No; I did not. 

Mr. Robinson. Did you have anything to do with the return of those 
records to the Guarantee Finance Co. ? 

Mr. Utley. The Guarantee Finance Co. records ? 
Mr. Robinson. For the Kobey Collection Agency? 
Mr. Utley. Their records? 
Mr. Robinson. That is right. 
Mr. Utley. For their business ? 



356 ORGANIZED CRIME IN INTERSTATE COMIVIERCE 

Mr. Robinson. That is correct. . j^; 

Mr. Utley. a loan business? 

Mr. Robinson. The Kobey Collection Co. or the Guarantee Finance 
Co. 

-Mr. Utley. I never had any of their records or never returned any. 

Mr. Robinson. Did you ever conduct any negotiations for the re- 
turn of their records ? 

Mr. Utley. No. 

Mr. Robinson. Did you have any association with the recall move- 
ment of Mayor 

Mr. Utley. Pardon me? May I say that I — you said the finance 
company records. I did return some record to keep but tliey were not 
finance company records. 

Mr. IvOBiNSON. Will you explain what the records were? 

Mr. Utley. They were bookmaking records. 

Mr. Robinson. Records that were taken from Donald Himbow, is 
that correct? 

Mr. Utley. I don't know who they were taken from, but they were 
sheets for bookmaking, and I met Kobey, not at the office. I gave him 
the sheets. The reason I am explaining this is the word "record" in 
there. I might confuse one with the other. 

Mr. Robinson. Just v/hat were your negotiations with respect to 
the records that you refer to now ? 

Mr. Utley. A person gave me the records and I gave them to 
Marvin Kobey. 

Mr. Robinson. Can you identify the person ? 

Mr. Utley. Yes. 

Mr. Robinson. Will you do so for the record ? 

Mr. Utley. Manuel Lieberman gave me the records. 

Mr. Robinson. What business is he in ? 

Mr. Utley. I think he was an informant for the police department. 

Mr. Robinson. Were you interceding for Kobey in that connection? 

Mr. Utley. Yes, I did. 

Mr. Robinson. Did you have any connection with the recall move- 
ment of Mayor Bowron in 1949 ? ^-^ 

Mr. Utley. No. 

Mr. Robinson. You are sure you had no connection with it? 

Mr. Utley. No. 

Mr. Robinson. You did not contribute anything to that recall 
movement ? 

Mr. Utley. I did not. 

Mr, Robinson. You were not associated with the group called the 
Big Five? 

Mr. Utley. I don't know who the Big Five are. 

Mr. Robinson. I was going to ask you that. 

The Chairman. Let us get to anything else here we have got. 

Mr. Halley. You had nothing to do with the recall whatsoever? 

Mr. Utley. No. 

Mr. Halley. Did you ever make a proposition to anybody about 
calling the recall off? 

Mr. Utley. I did not. 

Mr. Halley. Did you ever send any emissary or agent or anybody 
whatsoever to talk 



ORGANIZED CRIME IN INTERSTATE COMMERCE 357 

Mr. Utley. I did not. 

Mr. Halley. Let me finisli my question. To talk to the mayor? 

Mr. Utley. I did not. The reason I answered it so soon, I read 
about it before somewhere in the papers. 

Mr. Halley. Let's be very specific. 

Mr. Utley. I did not. 

Mr. PIalley. Let's get a question before you answer it, if you don't 
mind. I know you are anxious to clear yourself, but you can't clear 
yourself unless 3^ou answer a question. 

Did you ever discuss with anybody the question of having the recall 
discontinued — and I refer to the recall of Mayor Bowron. 

Mr. Utley. Yes. 

Mr. Halley. With whom ? 

Mr. Utley. A girl by the name of Polly Gould. 

Mr. Halley. When and where did you have such discussion ? 

Mr. Utley. I think it was in her house. 

Mr. Halley. Did you go there at her request or at yours ? 

Mr. Utley. At her request. 

Mr. Halley. Will you tell the committee just what happened? 

Mr. Utley. She told me she had contacted someone in the mayor's 
office and if I could help kill the recall the administration would feel 
very kindly toward me. 

Mr. Halley. Go ahead. 

Mr. Utley. I told her that I would like to kill the recall if I could, 
and the only consideration that I would want from the administration 
would be to get any legitimate licenses that any other person had in the 
city of Los Angeles, not stating what it was, and for that consideration 
I would do anything to help kill the recall. 

Mr. Halley. Did she approach you, or did you approach her ? 

Mr. Utley. She approached me. 

Mr. Halley. Did j^ou have any discussions directly with the mayor 
about it? 

Mr. Utley. I did not. 

Mr. Halley. Do you know ISIr. Ed Montgomery ? 

Mr. Utley. Can't place the name. 

Mr. Halley. What finally happened? Did you authorize her to 
have a discussion with the mayor ? 

Mr. Utley. I did. 

Mr. Halley. Did she report back to you ? 

Mr. Utley. She did. 

Mr. Halley. What did she say ? 

Mr. Utley. She said that if I showed any results on helping to 
kill the recall they would give me any honest consideration they would 
give anyone else. 

Mr. Halley. Did she say that the mayor had authorized her to say 
that? 

Mr. Utley. She did. 

]\Ir. Halley. What did you do then ? 

Mr. Utley. I lost confidence in her. She talked too much. 

Mr. Halley. What caused you to lose confidence in her? 

Mr. Utley. She talked too much, and I was under the impression 
she had a dictaphone in there, and I made things as brief as possible 
and avoided seeing her any further. 



358 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Halley. You mean you went to her home to have these dis- 
cussions ? 

Mr. Utley. She would call me and ask me to come to her home. 

Mr. Halley. Did you see anybody at all in connection with trying 
to have the recall discontinued ? 

Mr. Utley. I mentioned it to Irving Glasser and he was in favor 
of helping the recall being discontinued, but 

Mr. Halley. When did you mention it to Glasser? 

Mr. Utley. After I had an interview with Polly Gould. 

Mr. Halley. Did you talk to Glasser about what you might be able 
to do to get the recall discontinued ? 

Mr. Utley. Only not support the opposition, financially or in any 
other way. 

Mr. Halley. Were you supporting the opposition financially? 

Mr. Utley. I was considering it, raising funds for the opposition. 

Mr. Halley. Who asked you to do that ? 

Mr. Utley. No one. I just was doing it as a general thing. 

Mr. Halley. You opposed Bowron because of his stopping your 
game of bridgo-bingo, I presume? 

Mr. Utley. That is about it. 

Mr. Halley. You know a lawyer named Eummel? 

Mr. Utley. Yes, I do. 

Mr. Halley. Did you talk to him about discontinuing the recall? 

Mr. Utley. No, I did not. 

Mr. Halley. Was he raising money for the recall ? 

Mr. Utley. Not to my knowledge. 

Mr. Halley. Do you know Mickey Cohen ? 

Mr. Utley. Yes, I do. 

Mr. Halley. Have you ever had any business relations with him? 

Mr. Utley. No. 

Mr. Halley. You said that before. Are you quite sure of it ? 

Mr. Utley. Yes. 

Mr. Halley. Never gave him any money ? 

Mr. Utley. No. 

Mr. Halley. Did he ever borrow any from you ? 

Mr. Utley. He tried 

Mr. Halley. When ? 

Mr. Utley. Years ago. 

Mr. Halley. How many years ago ? 

Mr. Utley. 3 or 4 years ago. 

Mr. Halley. And you refused? 

Mr. Utley. I did. 

Mr. Halley. Do you own an apartment house ? 

Mr. Utley. I did. 

Mr. Halley. When ? 

Mr. Utley. Up to about 6 months ago. 

Mr. Halley. What was the name of it? 

Mr. Utley. Formosa Apartments. 

Mr. Halley. What did you pay for it ? 

Mr. Utley. $115,000. 

Mr. Halley. How much cash? 

Mr. Utley. I have a partner in it. 

Mr. Halley. Who was that ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 359 

Mr. Utley. Irving Glasser and his brother Louie Bernbaum. 

Mr, Halley. How much of it did you own ? 

Mr. Utley. I did own one-third of it. 

Mr. Halley. Did you pay cash for your third ? 

Mr. Utley. No, we did not. 

Mr. Halley. How much cash did you put into it ? 

Mr. Utley. I think I put in about" $21,000 or $22,000 in cash. 

Mr. Halley. Where did you get this money ? 

Mr. Uti-ey. This is after I sokl the jewelry store. 

Mr. Halley. What did you sell the jewelry store for? 

Mr. Utley. I don't remember the exact figures. We took inven- 
tory. Maybe around $15,000, and then I had some jewelry left over 
which I sold at intervals that they didn't accept at the time of the 
purchase, the people that bought it. 

Mr. Halley. Do you know anything else, any other property or any 
other business ? 

Mr. Utley. No, I don't. 

Mr. Halley, Have you owned any other in the last 5 years than 
what we have discussed? 

Mr. Utley. No. 

The Chairmatst. Have you got a Cadillac ? 

Mr. Utley. Yes, I have. 

The Chairman. A new one ? 

Mr. Utley. A '49. 

Senator Wiley. How much did Mickey want to borrow from you ? 

Mr. Utley. $8,000. 

Senator Wiley. $;],000 ? 

Mr. Utley. Yes, sir. 

Senator Wiley. When was that in relation to the time you were 
assaulted ? 

Mr. Utley. That was after I was assaulted. 

Senator W^iley. Are you sure of that? 

Mr, Utley, Quite sure. 

Senator Wiley, Why did you refuse him ? 

Mr, Utley, I didn't feel he was a good risk, and I might not have 
had the cash at the time, I am not sure. 

Senator Wiley, How many times has he tried to persuade you to 
loan money to him ? 

INIr, Utley, That was the only occasion. 

Senator Wiley. Are you real friendly with him ? 

Mr. Utley. No, 

Senator Wiley, Why ? 

Mr, Uti.ey, I have no business with him and I have no desire to be 
friends with him. 

Senator Wiley. Why? 

Mr. Utley. Well, I don't see any future in doing business with him, 
so naturally I don't encourage his friendship. 

Senator Wiley, Do you think he had anything to do with slugging 
you? 

Mr, Utley, I don't think so. 

Senator Wiley, Why ? 

Mr. Utley, If he had, I think I would have got some definite in- 
formation on it. 



360 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Senator Wiley. You were certainly an ordinary chap. Do you 
have any idea of who assaulted you on that particular occasion ? 

Mr. Utley. To be very truthful, I have no idea and couldn't see 
him. It has been puzzling me very much. 

Senator Wiley. Have you oot any bodyguards ? 

Mr. Utley. No. 

Senator Wiley. Has anyone assaulted you since or before ? 

Mr. Utley. No; never did. 

The Chairman. Mr. Utley, what did you actually do about stopping 
the recall? Did you get out and work against it — I mean for the 
recall ? 

Mr. Utley. I anticipated getting some money together for the re- 
call, and after talking to this party I dropped all the plans and didn't 
do anything about it. 

The Chairman. Did you feel that you were going to get some re- 
ward if the recall failed, some consideration ? 

Mr. Utley. I felt that I would not have the animosity of the city 
administration, and for that, if I was going into some legitimate busi- 
ness, I might be able to obtain a license for it. 

The Chairman. You really got the recall thing started, didn't you ? 

Mr. Utley. No; I did not. 

The Chairman. I mean, you and your group. 

Mr. Utley. No, I had nothing to do with it. 

The Chairman. Glasser did ? 

Mr. Utley. No ; not to my knowledge. 

(At this point there was a brief recess for a press conference be- 
tween the members of the committee and the members of the press.) 

TESTIMONY OF IRVING GLASSER, LOS ANGELES, CALIE. 

The Chairman. Mr. Glasser, 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. Glasser. I do. 

The Chairman. Mr. Glasser, we have a good many matters we want 
to talk over with you. We have been here 3 days, and I am sorry 
we haven't gotten to all of you sooner. We wondered if you would 
have any objection to giving Mr. Robinson or Mr. Van Brunt the 
answers to certain questions that they might ask you. 

Mr. Glasser. Not at all, if they have a right to do it. 

The Chairman. What I am asking is, I would like to have your 
agreement to designate them to ask you about certain matters instead 
of going on through it at this time. 

Mr. Glasser. I don't know what you mean. Senator. 

Senator Wiley. That is, that they take over instead of him. 

Mr. Glasser. I have no objection Mr. Robinson or Mr. Halley. 

Mr. Halley. Senator Kefauver means that he wants your state- 
ment. 

Mr. Glasser. I will be most happy to, if they have the right. 

Mr. Halley. Do you agree ? 

Mr. Glasser. I have no objection. 

Mr. Halley. Let Mr Van Brunt here have him on Monday. 

Mr. Glasser. Can't we do it now, while I am here ? It is not going: 
to be convenient for me to come back and for the gentleman. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 361 

The Chairman. Where do you live ? 

Mr. Glasser. I live here in Los Angeles — I lived here in Los An- 
geles for the past 45 years. You get my position, Senator, being in 
the nature of the business I am in, more people call my office, lawyers 
begin to worry: what are you doing up there? And all of that. If 
you w^ant to ask me anything here, I am ready, willing, and able. 

]\Ir. H ALLEY. I don't know if it can be done here. 

Mr. Glasser. I am not afraid of anything or anybody. 

Mr. Halley. Would you be just a little more cooperative? 

Mr. Glasser. I will. 

Mr. Halley. At room 228 in this building, 10 o'clock, at room 228.. 

Mr. Glasser. You are sure, Senator, he has the right to ask ques- 
tions ? 

Mr. Halley. Do you agree to answer them ? 

Mr. Glasser. I don't know. You are putting me in a very pre- 
carious position. I don't want to go from pillar to post. If there is 
a Federal inquisitorial body or a fact-finding body, here I am. 

Mr. Halley. We are asking if you are willing to cooperate to the 
extent of telling the facts to our investigators. Are you or aren't 



you 



Mr. Glasser. I will tell the facts to any living human. 

Mr. Halley. Will you appear and give the facts Monday morning 
to Mr, Van Brunt? 

Mr. Glasser. Is it a proper thing to do ? 

Mr. Halley. It is a very proper thing to do, if you are willing to 
do it. 

Mr. Glasser. I don't want to make it sound difficult. 

Mr. Halley. You are making it sound difficult. 

The Chairman. The only difference is, that, of course, he has no 
right to subpena you to appear, but if you agree to appear, then it 
serves our purpose just as well. 

Mr. Glasser. To expedite matters for you if I let him interrogate 
me. It is simple enough. I am sorry I didn't have the privilege of 
testifying before or talking to you. Do I have this body's agree- 
ment to ask Mr. Van Brunt or the marshal to turn back my office 
records when he is through looking at them tomorrow or Monday ? 

The Chairman. The marshal has your office records. 

Mr. Glasser. Yes ; I turned them over to him myself. 

Mr. Halley. They will be returned within a few days. 

Mr. Glasser. Let's get this straight It is very important to me. 

Mr. Robinson. I would like to have an hour or two or three to look 
through them. 

Mr. Glasser. Let's make it that you give them back to me Mon- 
day at 5 o'clock. 

Mr. Robinson. He is going to be occupied interrogating you. 

Mr. Glasser. When is he supposed to look at the records ? 

Mr. Robinson. Can we make it Tuesday at 5 ? 

Mr, Glasser, Will you order him to return all my records and 
papers by Tuesday at 5 ? I need them. 

Mr. Halley. You are also continued on subpena because the com- 
mittee will be back in this area, and at such time as it comes back 
it may require your testimony. 

The Chairman. We may or may not, but if we call you the same 
subpena will exist. 

68958— 51— pt. 10 24 



362 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Glasser. Does that give me the right to leave the jurisdiction 
of the city ? 

The Chairman. Just leave word. 

Mr. Glasser. Why don't you have Mr. Robinson cross-examine? 
He looks [indicating Mr. Van Brunt] like he is mad. No hard feelings. 

TESTIMONY OF CASPER ROTONDO, SR., SAN BERNARDINO, CALIF. 

The Chairman". Mr. Rotondo, 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. Rotondo. I do. 

The Chairman. I just wanted to ask you if that is a picture of 
a horse parlor you have. 

Mr. RoTONDO. It looks like it, Senator. 

The Chairman. Where is that? 

Mr. Rotondo. At 1965 Fifth Street, San Bernardino. 

The Chairman. All those pictures are of the same building? 

Mr. RoTONDO. Yes, sir. 

Tlie Chairman. Let those pictures, when they are all fastened to- 
gether, be an exhibit. 

Let me ask you this. The time is late; of course, it is not your 
fault. You have been here. The committee has urgent business to 
attend to. We wondered if you would be willing to give your testi- 
mony and answer questions of one of the members of our staff instead 
of remaining here this afternoon. 

Mr. RoTONDo. Certainly, Senator. 

The Chairman. Mr. Van Brunt will — can you handle him ? 

Mr. Van Brunt. Yes, sir. 

The Chairman. 228 Federal Building, say, 11 o'clock. 

Mr. Van Brunt. Monday? I would rather make it Tuesday; it 
will be more convenient. 

The Chairman. Is that convenient with you ? 

Mr. RoTONDO. Yes, Senator. 

TESTIMONY OF CASPER ROTONDO, JR., LOS ANGELES, CALIF. 

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. RoTONDO, Jr. I do. 

The Chairman. You might as well bring your son in at the same 
time. 

Mr. Halle Y. 11 o'clock Tuesday. 

Mr. RoTONDO, Jr. At room 228. 

The Chairman. Mr. Rotondo, Sr., I want to give you this informa- 
tion. I think this information should be given to your son, too. 

No questions will be asked you, I don't imagine, that violate your 
constitutional rights, but I did want to advise you that you or your 
son might be asked questions which would incriminate you of a Fed- 
eral offense; then you do not have to answer that. I just wanted to 
tell you that. 

Mr. RoTONDo, Sr. Yes. 

The Chairman. You are giving testimony before Mr. Van Brunt. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 363 

Mr. RoTONDO, Sr. That is Tuesday at 11, did you say ? 

Mr. Van Brunt, 11 o'clock. 

The Chairman. Come in at the same time. 

Mr. RoTONDo, Jr. Yes, sir. 

Mr. Van Brunt. Let's make that 10 o'clock. 

The RoTONDO, Jr. 10 o'clock, Tuesday at 10. 

TESTIMONY OF HYMIE MILLER, LOS ANGELES, CALIF. 

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. JNIiller. I do. 

The Chairman. Mr. Miller, where do you live ? 

Mr. Miller. 121 South Citrus Avenue. 

The Chairman. What are you doing there? 

Mr. Miller. What am I doing there ^ 

The Chairman. What is your business ? 

Mr. Miller. I am in Las Vegas right now, in the sports service 
business. 

The Chairman. Are you going to be here Monday or Tuesday in 
Los Angeles ? 

Mr. Miller. Monday I am to appear in Santa Monica in the su- 
perior court on this case of mine that I have been arrested about 4 
months ago. 

The Chairman. What we were trying to get at, the committee has 
urgent business and it is necessary to discontinue this hearing this 
afternoon as soon as possible because of many reasons, and we wanted 
to see if you would be willing to answer questions before one of our 
officers. 

Mr. Miller. I would be willing, Senator, if you can get me a con- 
tinuance in the other court. I can't be in both places. 

The Chairman. But your case starts there. 

Mr. Miller. It is supposed to start on Monday. 

Mr. Halley. Will you be on trial ? 

Mr. Miller. We don't know. 

Mr. Halley. Why couldn't he communicate with Mr. Van Brunt? 
Why not as soon as he finishes in court, get in touch wdth Mr. Van 
Brunt and then give his testimony. 

The Chairman. Are you in a hurry this afternoon? 

Mr. Miller. I have been waiting here for 3 days. Senator. 

Mr. Robinson. What is your telephone number? 
• Mr. Miller. Whitney 9531. 
. Senator Wiley. What does the trial involve on Monday? 

Mr. ]\IiLLER. It is the 33T-A, subdivision 2, Penal Code, maintaining 
paraphernalia in a boolanaking establishment. 

The Chairman. Suppose we just ask Mr. Miller a few questions 
right now, and then if Mr. Van Brunt or Mr. Ruymanii want to call 
him in later on for further examination, that will be all right with you, 
won't it? 

Mr. Miller. Yes, sir. 

Mr. Robinson. You were arrested by the Culver City Police Depart- 
ment ? 



364 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Miller. Well, Senator, I am no lawyer and I haven't got an 
attorney. I would like to ask you people if this w^ould self-incriminate 
me by answering these questions on account of this situation. 

The Chairman. The arrest you are talking about is the thing you 
are coming up for trial on ? 

Mr. Miller. Yes ; I am coming up. 

The Chairmax. That is going to start on Monday? 

Mr. Miller. Monday. 

The Chairman. The rule that you don't have to answer any ques- 
tions stands, and the Chair won't order you to answer any questions 
that would tend to incriminate you of a Federal offense. 

You haven't any such privilege of not answering something to do 
with a State offense. 

Mr. Miller. I must answer the questions. 

The Chairman. Was that what you were going to ask him about, 
some matter in connection with this? 

Mr. Robinson. That is correct. 

The Chairman. I think probably, in fairness, it would be best for 
our staff to keep in touch with you and ask you to come in right after 
your trial is over. 

Mr. Halley. You will then give them a full statement. You will 
then answer whatever questions they put to you. 

Mr. Miller. Sure, I will be glad to. 

The Chairman. Are there any matters not connected with this trial 
that you want to ask him about ? 

What do you operate in Las Vegas ? 

Mr. Miller. A sports book service. That is baseball, football, 
betting commissioning. 

The Chairman. Does your trial have anything to do with that? 

Mr. Miller. I wouldn't know, Senator. I mean, if it comes up that 
I am in Vegas, I went there to be in business. It is legitimate there. 
Do you see what I mean, Senator? 

The Chairman. You operate a baseball 

Mr. Miller. We call it a sports service. That means football, base- 
ball, fights, basketball. 

The Chairman. How about horse racing? 

Mr. Miller. No. 

The Chairman. Do you have a wire service for all these things ? 

Mr. Miller. No. 

The Chairman. You just take bets? 

Mr. Miller. We take bets. 

The Chairman. Anybody can call in anywhere in the United States 
and place a bet with you? 

Mr. Miller. Well, we haven't got no connections in the East, though. 
Mostly in Las Vegas. 

The Chairman. But they do call from other States sometimes? 

Mr. Miller. We don't take any bets from the East. 

The Chairman. I mean from the West, though? 

Mr. Miller. Yes, people call from here, Los Angeles, San Francisco. 

The Chairman. Then do you lay off bets with anybody ? That is, 
if they get too big? 

Mr. Miller. Yes. 

The Chairman. Wlio do you lay off with ? 



ORGANIZED CRIME IN INTERSTATE COMMERCE 365 

Mr. Miller. I laid off in Chicago about 5 months ago with the 
Gym Club. 

^Tlie Chairman. The Gym Club? 

Mr. Miller. That is G-y-m. 

The Chairman. What is the address of that club ? 

Mr. Miller. I don't know, but it is a place on La Salle, some place, 
but I don't know the exact address. 

The Chairman. What is the man's name who runs it ? 

Mr, Miller. Johnny McDonnell. 

The Chairman. Who else could you lay off with ? 

Mr. Miller, I laid off with another fellow named Mel Clark. 

The Chairman. Where is he? 

Mr. Miller. He is in Chicago, 

The Chairman. What is the name of his outfit ? 

Mr. Miller. He is just down another street, but we haven't done 
no business wdth him in the last 6 months or so, and I don't know — 
remember the address, Senator, 

The Chairman. How do you handle this? Do you call them on 
the telephone ? 

Mr. JSIiLLER. Yes. 

The Chairman. Like you say, you have a bet on a baseball game 
for $1,000. You want to see it laid off ? 

Mr. ]\IiLLER. That is right. If we get overloaded, like if we take 
a gamble of $2,000 on a game, if we have got $4,000 we lay it off to 
them. 

The Chairman, What do you get out of a lay-off bet like this? 

Mr, Miller, We get nothing. We have to lay the odds. 

The Chairman. You mean you don't get a commission? 

Mr. Miller. No, not when we lay off, because we laid the odds. 

The Chairman. How do you make anything out of it ? 

Mr. Miller. We back the game, and, say, one m^m bets us $1,100 
to $1,000 on one side — pardon me. Senator, this is au account of that 
case of mine in Santa Monica — I asked 

The Chairman. Well, is this part of the case that you have got 
coming up ? 

Mr. Miller. If I admit that I am — to you people I admit it. Do 
you know what I mean ? 

The Chair]man. We are not going to interrogate you any further. 
Anything you have said will be kept executive. 

Mr. Miller. Thank you, Senator. 

Mr. Halley. Just one thing. Was it you who went out and found 
Borden in Las Vegas ? 

Mr. Miller. No, sir. 

Mr. Halley. Did you talk to Mickey Cohen about Borden? 

Mr, Miller. Yes, sir, 

Mr, Halley. What happened? 

Mr. Miller. I was in bed about 12 o'clock, it might have been 
12 : 30, Friday night, and I got the operator. I told them I was going 
to bed and that I didn't want no calls. So the operator called me and 
said it was very important. 

Mr. Halley, Where were you living ? 

^Ir, IMiLLER. At the Flamingo, 

Mr, Halley, Are you still living there ? 



366 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Miller. I live here. I work 2 weeks there and I come home 
for a couple of weeks. I have got a family here, I have got a wife 
and three kids. So I got this call and it was Mickey. He said, "Have 
you seen Borden?" I said, "All evening." He happened to be shoot- 
ing craps there. I didn't go close to the table or anything 

The Chairman. Shooting craps where? 

Mr. Miller. In the Flamingo. This fellow Borden — I said, "Yes^ 
I saw him shooting craps." He said, "Get ahold of him and tell him 
I want to see him." 

So I called down and — ^my wife happened to be in the casino. She 
didn't go to bed yet. So I told her: "Is Eddie Borden still around 
there?" She said, "He just left about 10 minutes ago. He was sitting 
around talking. He said, 'I am tired. I am going home.' " 

So then he called back again, Mickey, in about half an hour. He 
said, "Hymie, we have got to find him." I said, "Mickey, I am in 
bed. I have got to go to work tomorrow." He said, "Get out of 
bed." I said, "I am not getting out of bed." And that was it. 

Mr. Halley. You didn't find him for Mickey ? 

Mr. Miller. No, sir. 

Mr. Halley. Who did? 

Mr. Miller. Well, I was sitting in the courtroom yesterday and by 
the testimony Mickey gave he said he — Eli Lubin found him^ I guess. 

Mr. Halley. Did you see Lubin out there at Las Vegas ? 

Mr. Miller. I saw him the next day. 

Mr. Halley. When? 

Mr. Miller. They come in my place on a Saturday. 

Mr. Halley. What time Saturday ? 

Mr. Miller. It might have been in the afternoon. 

Mr. Halley. Did Lubin say he had gone to Los Angeles and come 
back? 

Mr. Miller. I think he did say something about it. He has been 
up ; he hasn't been to bed. 

Mr. Halley. Did he say he took Borden to Los Angeles ? 

Mr. Miller. He said he went to Los Angeles. 

Mr. Halley. Did you ask him if he found Borden? 

Mr. Miller. I asked him. 

Mr. Halley. You fellows must have talked about Borden. 

Mr. Miller. Counselor, we talked about Borden. 

Mr. Halley. What did you say ? 

Mr. Miller. Just — he said he was up all night. That is all. 

Mr. Halley. What did he tell you about Borden ? Just start at the 
beginning. Where were you when he came in ? 

Mr. Miller. I was in my place of business. 

Mr. Halley. Where is that located ? 

Mr. Miller. At the El Dorado. 

Mr. Halley. And he walked in Saturday afternoon? 

Mr. Miller. Around 3 or 4 o'clock; yes. 

Mr. Halley. Did you ask him if he got Borden back all right? 

Mr. Miller. It was none of my business. 

Mr. Halley. Did he tell you lie had taken Borden back? 

Mr. MiIjLer. He was talking to mv wife about Borden. 

Mr. Halley. What did he tell her? 

Mr. INIiLLER. She told me that he said that he found Borden. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 367 

Mr. Hallet. How did you know he was looking for Borden ? 

Mr. Mn.LER. Who ? 

Mr. Halle Y. Lubin. 

Mr. Miller. I didn't know he was looking for him. 

Mr. Halley. You didn't know ? 

Mr. MiLi.ER. Not that night. I was in bed. The next morning 
I found out about it. My wife told me about it. 

Mv. Halley. What did your wife tell you about it? 

Mr. IMiLLER. She told me she saw Eli and Eli was looking for him. 
She stood up — she stood up to about 3, 4 o'clock. 

Mr. Halley. Did you know that he had chartered a plane and gone 
into Los Angeles ? 

Mr. Miller. Next day I did. 

Mr. Halley. "Wlio told you ? 

Mr. Miller. Eli. 

Mr. Halley. Wliy don't you tell the committee ? Do I have to pull 
this out one tooth at a time ? Why don't you tell the committee what 
he told you ?• 

Mr. Miller. Eli Lubin told me he chartered a plane and went with 
Borden. 

Mr. Halley. Did he say why Mickey was so anxious to get Borden ? 

Mr. Miller. No ; that was the only conversation. 

Mr. Halley. Did you see Borden around Las Vegas ? 

Mr. Miller. I saw Borden Thursday night in the Desert Inn, and 
I saw him at the Flamingo. 

Mr. Halley. Did Borden look like he was ready to 

Mr. Miller. Borden looked worn out and he looked like he had 
something on his mind. 

Mr. Halley. Did he say he was broke ? 

Mr. Miller. I didn't talk to him. 

Mr. Halley. You didn't talk to him at all ? 

Mr. Miller. Well sir, he was shooting craps, and the table was 
full, and I didn't want to bother. 

Mr. Halley. Did Mickey tell you why he wanted Borden when he 
called you? 

Mr. Miller. Wlien he called back he sound — he said. "We are in 
trouble," or something. "They are going to pinch him tomorrow 
and there is going to be headlines." 

Mr. Halley. He said that ? Are you sure ? 

Mr. Miller. Don't get me wrong. I am not trying to protect any- 
body. I have got a wife and three children and Mickey Cohen doesn't 
mean no more to me if he is in the street tomorrow or any place. 

Mr. Halley. Mickey was very anxious to get Borden to Los An- 
geles; is that right? 

Mr. Miller. Counselor, I told you what he said. He said, "If we 
don't get Borden back there is going to be headlines in the paper." 

Mr. Halley. What did Lubin say, exactly, when he came in the next 
afternoon ? 

Mr. Miller. He talked to my wife. 

Mr. Halley. He didn't talk to you at all ? 

Mr. Miller. He started laughing and clowning. 

Mr. Halley. Did he talk about why he had to charter a plane to 
get back to Los Angeles ? 



368 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Miller. No ; he told my wife that they got a plane and they 
^yent back to Los Angeles. 

Mr. Halley. Didn't he say that Mickey had insisted that they 
charter a plane and get back quick? 

Mr. Miller. No ; he didn't tell me that, sir. 

Mr. Halley. Wlio paid for the plane, did he tell you that? 

Mr. Miller. I don't know. I washed my hands of it. 

Mr. Halley. Yes ; but you can't wash your hands of it here. 

Mr. Miller. I am trying to say here. But when he called me the 
second time I had — I said, "Mickey, I am in business in Vegas. I 
have got to make a living." I said, "I don't want to get in no trouble. 
I have never been in trouble." He called me twice. 

Mr. Halley. He said he had to get Borden back in Los Angeles? 

Mr. Miller. I guess so. He said Borden has got to be back in Los 
Angeles. 

Mr. Halley. That is what he said ? 

Mr. Miller. Yes. 

Mr. Halley. Did he say anything about being worried about Bor- 
den killing himself ? 

■\[r. Miller. No, he didn't say it. 

The Chairman. But he seemed to be very urgent about it, didn't 
he? 

Mr. Miller. Yes, Senator, because he called me two times. Maybe 
he might have called me three times. 

The Chairman. Did you see Borden's wrists having been slashed? 

Mr. Miller. Really, 1 didn't. Thursday night I was surprised. I 
saw him in the Desert Inn, and I heard that he hadn't shown up 
around Los Angeles. 

He hadn't been for 4 days, and we were talking, very little talking 
terms, anyhow, at the time. Although we had been very friendly 

Mr. Halley. Then you will be in touch with Mr. Van Brunt, then? 

Mr. Miller. Yes. 

TESTIMONY OF WILLIAM L. ROBERTSON, SEAL BEACH, CALIF. 

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. Robertson. I do. 

The Chairman. "Wliere do you live, Mr. Robertson ? 

Mr. Robertson. 208 Main Street, Seal Beach. 

Tlie Chairman. How far is that from Los Angeles? 

Mr. Robertson. Approximately 40 miles. 

The Chairman. Do you come up here every day or so ? 

Mr. Robertson. I haven't been up here in — well, I wouldn't say 
much, but I only come up here on business, and it has got to be very 
urgent. 

The Chairman. The reason I was asking you that is that the com- 
mittee has to leave here very shortly and we were — I wanted to know 
if you would be willing to give a statement and answer some questions 
to one of our investigators when you are up here, but if you don't come 
up often we don't want to inconvenience you any more than we have to. 

Mr. Robertson. Frankly, I have sinus trouble very bad, and when 
I get up in the smog it is anything but pleasant, and that is one of the 



ORGANIZED CRIME IN INTERSTATE COMMERCE 369^ 

principal reasons I don't — that is one of the principal reasons I don't 
come up. 

The Chairman. Yon don't tell the Los Angeles Chamber of Com- 
merce that, do you ? 

The Witness. That wouldn't be exactly proper. 

Mr. Halley. Do you run the Airport Club at Seal Beach ? 

Mr. Robertson. I am part of the operation, you might say. 

Mr. Hai.ley. How much of it do you own ? 

Mr. Robertson. Under a partnership which was recently formed,, 
27 percent. 

Mr. Halley. Is that a social nonprofit club ? 

Mr. Robertson, Well, it is a jumbled-up affair. It started out in 
order to obtain a city license as a nonprofit club. 

Mr. Halley. What is it now, a profit club? 

Mr. Robertson. Well, the license is held by a nonprofit club, but 
the operation itself is in the partnership. 

Mr. Halley. And the partnership does take profits ? 

Mr. Robertson. It does. 

Mr. Halley. What is the business that it operates? 

Mr. Robertson. A card room, a restaurant, and a form of bingo. 

]\Ir. Halley. Are the card room and bingo legal or not ? 

Mr. Robertson. Yes ; we are licensed under the city. 

Mr. Halley. The cards and the bingo ? 

Mr. Robertson. Yes, sir. 

Mr. Halley. Isn't it justification for it that it is a social club? 

Mr. Robertson. No. 

Mr. Halley. For the card room ? 

Mr. Robertson. Any justification that it could be a social club. 

Mr. Halley. No; isn't that the reason that it got the license as a 
social club? 

Mr. Robertson. No ; the license was issued to the Airport Club. 

Mr. Halley. And that is a social club ? 

Mr. Robertson. That is a social club. 

Mr. Halley. But now it is being run by a club that isn't a social 
club, isn't that a fact ? 

Mr. Robertson. You are stating it a little bit indirectly. There is 
an arrangement between the Airport Club and the owners for the 
operation and the use of the license. 

Mr. Halley. Now, the owners are actually getting a profit, then? 

Mr. Robertson. That is right. 

]Mr. Halley. Aren't 3^ou evading the law ? 

Mr. Robertson. No, sir. 

Mr. Halley. How do you explain it? 

Mr. Robertson. Well, T am not an attorney but it has been gone over 
by many attorneys, and they claim not. 

Mr. Halley. Which attorneys have advised you that you are op- 
erating legally? 

Mr. Robertson. Thomas J. Kelly. 

Mr. Halley. Is he at Seal Beach or here ? 

Mr. Robertson. No, sir, he is in Los Angeles. He is in room 108, 
Subway Terminal Building. 

Mr. Halley. Do you publish a newspaper at Seal Beach? 

Mr. Robertson. I own and publish it ; that is right. 



^70 



ORGANIZED CRIME IN INTERSTATE COMMERCE 



Mr. Halley. What business were you in before you went to Seal 
Beach? 

Mr. Robertson. Oh, I was in the printing business 15 — I was in 
the printing business, 1508 South Main Street. 

Mr. Halley. Were you ever in any gambling business before Seal 
Beach? 

Mr. E-OBERTSON. Well, it is just according to what you call gam- 
bling. 

Mr. Halley. Well, just tell us what business you were in, then. 

Mr. Robertson. Well, I was on the police department for 17 years.; 

Mr. Halley. At Los Angeles ? 

Mr. Robertson. That is right. 

Mr. Halley. When did you resign? 

Mr. Robertson. In 1940. 

Mr. Halley. Did you resign, retire, or were you fired ? 

Mr. Robertson. I resigned. 

Mr. Halley. Wliat did you start doing in 1940 ? 

Mr. Robertson. I don't think I was employed in any capacity for 
some time. 

Mr. Halley. When did you first go to work? When did you first 
get some occupation? 

Mr. Robertson. Well, I did some building at a residence in Los 
Angeles, and I believe I bought the newspaper in Seal Beach next, 
and then I bought a printing plant in Los Angeles. 

Mr. Halley. What did you pay for the newspaper ? 

Mr. Robertson. I don't remember. It was around $7,000 or $8,000. 

Mr. Halley. What did you pay for the printing plant? 

Mr. Robertson. Thirty-thousand-odd dollars. 

Mr. Halley. When you resigned from the police department did 
you have some assets? 

Mr. Robertson. Yes ; I had considerable. 

Mr. Halley. What was your net worth when you resigned from the 
police department? 

Mr. Robertson. Possibly $150,000. 

Mr. Halley. How did vou accumulate that? 

Mr. Robertson. Oh, di:fterent methods. Some was an income from 
the stock market. One thing and another. 

Mr, Halley. We would be quite interested to know just what it was. 

Mr. Robertson. Well, it is a long time ago, to go back into it. 

Mr. Halley. Wliat was your salary as a policeman? Your maxi- 
mum salary you ever earned 

Mr. Robertson. Really, I couldn't tell you, to be honest with you. 

Mr. Halley. Not over $5,000 a year? 

Mr. Robertson. I rather doubt that. 

Mr. Halley. Did you have any other occupation while you were 
on the police department ? 

Mr. Robertson. No; I didn't. My wife and I made an arrange- 
ment between ourselves when we were married that we were to save 
our money as best we could for 5 years, and at the end of the 5-year 
period she was employed — we had saved a little over $15,000 by very 
frugal living. 

Mr. Halley. And you used that for your own investments? 

Mr. Robertson. Well, that, naturally, would have been the basis. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 371 

Mr. Halley. Mr. Chairman, this gentleman apparently has a rather 
involved financial structure that we ought to look into, and. I rather 
think that we ought to ask him to come up and take some hours with 
Mr. Van Brunt some day next week and get the entire matter straight- 
ened out. 

The Chairman. What day could you come back next week, Mr. 
Robertson ? 

Mr, Robertson. I would rather get it over with today, if it is possi- 
ble. I mean, the statement by counsel here doesn't exactly exemplify 
my condition, because my financial affairs are not so intricate or in- 
volved, I am sure. 

Mr. Halley. Do you have your records with you ? 

Mr. Robertson. I do not. 

Mr. Halley. Do you have records? 

Mr. Robertson. I rather doubt it. 

Mr. Halley. You must have had a bank account in 1940. 

Mr. Robertson. That is right, and it would be available for you 
gentlemen. 

Mr. Halley. We would want to have whatever records you can 
assemble before we can go into that matter. 

Mr. Robertson. You would be privileged to subpena those. 

]Mr. Halley. In fact, what we are asking you is that you cooperate 
with the committee to the extent of getting together your records and 
see Mr. Van Brunt some day next week. Now, if the trip up from Seal 
Beach is too much for you, maybe we can arrange to have him come 
down there and see you there, and bring a stenographer with him and 
take your statement. 

Mr. Robertson. I don't object to Mr. Van Brunt. I don't even know 
the gentleman. But I would rather have a hearing, if I may, before 
the committee. I have nothing to hide no place. 

]Mr. Halley. Have you kept copies of your income tax returns?^ 

Mr. Robertson. I may have some of them. 

Mr. Halley. Going back to what years ? 

Mr. Robertson. I couldn't tell you. I made no special attempt — 
I gave that no special attention in thinking about it. 

Mr. Halley. With what banks have you done business since 1930, 
you or your wife ? 

Mr. Robertson. I believe the Security-First National and the 
Farmers and Merchants, 

Mr. Halley. Here, in Los Angeles ? 

Mr. Robertson. Yes, the Farmers and Merchants is at Fourth and 
Main and — I don't know about the Security. It seems to me like we 
used to bank with them in the Atwater district. I am not very certain 
of that. It might have been a small savings account or something of 
that sort. 

Mr. Halley, Did you have a safety deposit box ? 

Mr. Robertson. Yes; I have a safety deposit box at the Farmers' 
and Merchants Bank. 

Mr. Halley. Did you have any before 1940, a safe deposit box ? 

Mr. Robertson. Yes; I had one there and I — I used to live on a 
street on the west side. I think it was Berendo, and I had one at the 
bank near there, but I can't tell you which one it was. 

Mr. Halley. Did your wife have any safe deposit boxes? 



372 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Robertson. Well, she makes use of the ones that we have jointly, 

Mr. Halley. How long would it take you to get down to Seal Beach 
today to look for your records? 

Mr. Robertson. About an hour and 15 minutes, I imagine. 

The Chairman. You don't want to give any information to Mr. 
Van Brunt. You want to appear before the committee only? 

Mr. Robertson. It isn't that, Senator, it is just the idea. I have 
nothing to hide and I have no objection, as I mentioned to you, about 
Mr. Van Brunt. I don't even know the gentleman. 

Mr. Halley. I think you ought to come to San Francisco. The 
committee will be sitting there on Tuesday. 

The Chairman. How did you accumulate this $150,000 out of 
$15,000? 

Mr. Robertson. Well, it would be a little bit difficult. Senator, to go 
back into that. It has been so long ago. There have been many 
transactions and I have made investments of different kinds. I have 
run in and out of the stock market possibly one hundred or two hun- 
dred thousand dollars, or maybe more, a year, for a considerable num- 
ber of years, and that account was with E. F. Hutton & Co. Some 
other brokerage firm was in there also. And then there was the Pa- 
cific — I can't remember the name of the other firm. 

The Chairman. What businesses outside of your stock market op- 
erations did you have during these years when you were accumulating 
$150,000? 

Mr. Robertson. AVhat specific businesses? 

The Chairman. Yes. 

Mr. Robertson. I really had none then on the police department. 

The Chairman. Did you have an interest in any business? 

Mr. Robertson. Well, I personally didn't have any. 

The Chairman. Your wife? 

Mr. Robertson. Yes, my wife. 

The Chairman. What sort of business did she have? 

Mr. Robertson. She had an interest in a club in Seal Beach. 

The Chairman. What sort of club ? 

Mr. Robertson. Well, it was along the lines as this one at Seal 
Beach at the present time. 

The Chairman. Where was that club ? 

Mr. Robertson. It was in Seal Beach, 

The Chairman. It was at Seal Beach ? 

Mr. Robertson. That is right. 

Mr. Halley. Who were your partners in that club in Seal Beach? 

Mr. Robertson. Really, I wasn't interested in it personally. 

Mr. Halley. Are you now interested in it ? Don't you own a piece 
of it? 

Mr. Robertson. Oh, I do not. 

The Chairman. He is talking about right now, Mr. Robertson. 

The Witness. At the present time ; yes. 

Mr. Halley. You own it now ? 

Mr. Robertson. Yes, sir. 

Mr. Halley. Who are your partners now ? 

Mr. Robertson. Twenty-seven percent. I don't know that I can 
name all of them for you because I was not at the attorney's office. 

Mr. Halley. Did Fred Howser own any part of it ? 

Mr. Robertson. None whatsoever. 



ORGANIZED CRIME IN INTERSTATE COMMERCE 373 

Mr. Hallet. Has he any connection with it ? 

Mr. Robertson. None; definitely. 

Mr. Hallet. Do you know him ? 

Mr. Robertson. Yes ; I do. 

Mr. Hallet. How long have you known him ? 

Mr. Robertson. About 15 years. 

Mr. Hallet. Have you ever had any business dealings with him? 

Mr. Robertson. No. He and I don't get along personally, or po- 
litically either. 

The Chairman. Well, Mr. Robertson, we would like for you to get 
up with what records you can find and appear before the committee 
in San Francisco either Tuesday or Wednesday. We, of course, 
will take care of your transportation expenses. 

Mr. Robertson. I am sorry that you find it necessary, gentlemen. 
It is a terrific inconvenience. I have nothing to hide. I will assure you 
of that. 

The Chairman. That is the reason we want you to bring your 
records. 

Mr. Hallet. Will the chairman specifically instruct the witness 
that pursuant to a subpena which has been served upon him, he is to 
appear before the committee at the Federal courthouse? 

Mr. Robinson. Seventh and Mission, San Francisco. 

Mr. Hallet. At 10 o'clock on Tuesday morning, November 21. 

Mr. Robinson. Would you make it 2 o'clock Tuesday afternoon, 
November 21 ? 

Mr. Hallet. And to bring with him all copies of income-tax returns 
and working papers for the years 1930 to 1950, all financial records, 
canceled vouchers, bank books, bank statements, check books, evidences 
of income, of wealth, of indebtedness, and any and all records per- 
taining to his income and his total assets during the years 1930 
through 1950. 

The Chairman. All that are available, Mr. Robertson. 

Mr. Robertson. I wonder if you would mind writing that down so 
I would know where to appear. 

Mr, Hallet. We also ask you to bring with you any records relating 
to bank accounts, assets, income-tax returns, financial dealings of your 
Tvife for the same years, if they are in your possession. 

Does the committee so order? 

The Chairman. You will be so directed to bring those, Mr. Rob- 
ertson. 

TESTIMONY OF JAMES J. CONTRATTO, LAS VEGAS, NEV. 

The Chairman. Do you solemnly swear that the testimony you will 
«:ive this committee will be the truth, the whole truth, and nothing but 
the truth, so help you God ? 

Mr. CoNTRATTo. I do. 

Mr. Hallet. We wondered if you would make a statement before 
Mr. Van Brunt. 

The Chairman. AVliere do you live, Mr. Contratto ? 

Mr. Contratto. At the present time I live at the El Rancho Hotel 
in Las Vegas. 

The Chairman. We are anxious to adjourn this meeting this after- 
noon. Are you going back to Las Vegas ? 



374 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. CoNTRATTO. Yes ; I would like to. 

The Chairman. Would you be willing for Mr. Ruymann to see you 
and to ask you certain questions and for you to give him the answers 
as if you were here ? 

Mr. CoNTRATTO. Yes, sir. 

The Chairman. You know Mr. Ruymann ? 

Mr. CoNTRATTO. The gentleman right there [indicating] . 

Mr. Halley. He will be in touch with you probably some day early 
next week. 

Mr. CoNTRATTo, I will try to leave here Monday because I have been 
postponing sending my wife back East because her mother has been 
very sick. 

Mr. Halley. But you are going to be in ? 

Mr. CoNTiRATTO. I will leave just as soon as I can make arrange- 
ments for transportation either tomorrow or Monday. 

The Chairman. As soon as you get back to Las Vegas on Monday, 
you get in touch with Mr. Ruymann, 

Mr. CoNTRATTO, All right. I will call you when I get there. 

(Whereupon, at 2:30 p, m., the committee adjourned, subject to 
call of the chairman.) 



INVESTIGATION OF OEGANIZED CRIME IN INTERSTATE 

COMMERCE 



MONDAY, NOVEMBER 20, 1950 

United States Senate, 
Subcommittee of the Special Committee To 
Investigate Organized Crime in Interstate Commerce 

Los A^igeles, Calif. 
executive session 

The subcommittee met, pursuant to call of the chairman, at 10 a. m., 
in the Federal Building, Los Angeles, Calif., Herbert Van Brunt, spe- 
cial representative to the committee, presiding. 

Present : Mr. Van Brunt. 

FURTHER TESTIMONY OF IRVING G. GLASSER, LOS 
ANGELES, CALIF. 

(Mr. Glasser having been previously sworn testified as follows :) 

Mr. Van Brunt. Will you state your full name? 

Mr. Glasser. Irving G. Glasser. 

Mr. Van Brunt. Your address, Mr. Glasser. 

Mr. Glasser. 8439 Sunset Boulevard. 

Mr. Van Brunt. What is your business address ? 

Mr. Glasser. 239 North Broadway, Los Angeles. 

Mr. Van Brunt. What is your business known as? 

Mr. Glasser. Glasser Bros. 

Mr. Van Brunt. Is that the name, Glasser Bros. ? 

Mr. Glasser. Yes ; that is right. 

Mr. Van Brunt. It is a bonding concern ; is it not ? 

Mr. Glasser. Yes, sir. I am a bail agent and insurance broker. 

Mr. Van Brunt. Are you the owner of the business ? 

Mr. Glasser. No, sir; I am not. 

Mr. Van Brunt. What is your position? Are you just a bail 
agent ? 

Mr. Glasser. My brother and I own the business. We are partners 
in Glasser Bros., but we are bail agents for the National Automobile 
Insurance Agency. 

Mr. Van Brunt. What is j^our brother's name, Mr. Glasser? 

Mr. Glasser. Louis. 

Mr. Van Brunt. How long have you been engaged in business in 
Los Angeles ? 

Mr. Glasser. Close to 30 years. 

Mr. Van Brunt. Has it always been known as Glasser Bros. ? 

375 



.'376 ORGANIZED CRIME IN INTERSTATE COMMERCE 

Mr. Glasser. No, sir. 

Mr. Van Brunt. Prior to it being known as Glasser Bros., what was 
jour business known as ? 

Mr. Glasser. Cantillon, Groves & Glasser. 

Mr. Van Brunt. Was that business located at the same address ?