Virgil Peterson Testimony
HEARINGS BEFORE THE SPECIAL COMMITTEE TO INVESTIGATE ORGANIZED CRIME IN INTERSTATE COMMERCE UNITED STATES SENATE EIGHTY-FIRST CONGRESS SECOND SESSION PURSUANT TO S. Res. 202 A RESOLUTION AUTHORIZING AN INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE COMMERCE PART 2 JUNE 22, 23, 28; JULY 6, 7; AUGUST 16, 1950 ... VIRGIL W. PETERSON, Operating Director, Chicago Crime Commission ... Printed for the use of Special Committee to Investigate Organized Crime in Interstate Commerce UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON 1950 DEC 18 1950
The CHAIRMAN. Mr. Peterson, will you come around, please ? Mr. Peterson, I take it we can get started with your testimony and then we will have to recess for lunch and answer the call of the Senate fairly shortly. I do not think you have been sworn. Do you solemnly swear the testimony you will give this committee will be the whole truth and nothing but the truth, so help you God ?
Mr. PETERSON. I do.
TESTIMONY OF VIRGIL W. PETERSON, OPERATING DIRECTOR, CHICAGO CRIME COMMISSION, REPRESENTING THE AMERICAN MUNICIPAL ASSOCIATION
The CHAIRMAN. Mr. Peterson, you are the operating director of the Chicago Crime Commission?
Mr. PETERSON. That is right.
The CHAIRMAN. Mr. Peterson, how long have you been operating director of the Chicago Crime Commission ?
Mr. PETERSON. About 8 1/2 years.
The CHAIRMAN. The Chicago Crime Commission, as I understand it, is a voluntary association supported by contributions of the interested citizens; is that correct?
Mr. PETERSON. That is correct. It is a civic organization.
The CHAIRMAN. Prior to being operating director of the Chicago Crime Commission, you were associated with the Federal Bureau of Investigation ?
Mr. PETERSON. That is correct. I was with the FBI about 12 years.
The CHAIRMAN. What position did you hold with the FBI when you left ?
Mr. PETERSON. When I left the FBI, I was in charge of the Boston office.
The CHAIRMAN. Do you call that the agent in charge?
Mr. PETERSON. That is right, special agent in charge of the Boston office of the FBI.
The CHAIRMAN. You have had experience with the FBI in most of the sections of the United States in the matter of Federal law enforcement?
Mr. PETERSON. In a considerable number of sections, not in every section.
The CHAIRMAN. What sections have you been stationed in?
Mr. PETERSON. I was in charge of the Boston office 4 years. Before that, St. Louis 1 year, before that Milwaukee 2 years, and then I worked in Chicago for 2 years, in New York City, Florida, Philadelphia. That covers it I think, mostly.
The CHAIRMAN. I might say to you, Mr. Peterson, that the Director of the FBI, Mr. Hoover, and Mr. Nichols, the Assistant Director, have spoken very highly of your work with the Federal Bureau of Investigation and also with the Chicago Crime Commission. In the opinion of at least the chairman of this committee, you are outstanding in the work that you have done in your experience and you are well qualified to be of service to the committee in telling us not only the matters about the situation in Chicago but in other sections of the country.
As I understand it, today you are testifying on behalf of the American Municipal Association.
Mr. PETERSON. That is correct. In fact, prior to last December I had conferences with several mayors that were having difficulties with the organized crime problem. In some instances they felt some organized gangs were attempting to take over local governments. As a result of that, I was requested to appear before the American Municipal Association at its annual meeting in Cleveland. They then asked me to come here as their representative.
The CHAIRMAN. The president of the American Municipal Association, I believe, was Mayor Morrison of New Orleans -- last year?
Mr. PETERSON. That is correct.
The CHAIRMAN. And this year who is the president?
Mr. PETERSON. I believe Mr. Newton from Denver.
Senator WILEY. Mr. Chairman, I would like to ask a question there.
Is your testimony going to apply to gangs, as you say, attempting to take over local government?
Mr. PETERSON. The principal purpose of my testimony is first to show the growth and development of some of the major gangs and the connections between these major gangs and many other sections of the country. I haven't gone too much into the government angle, although I may cover that somewhat in the testimony.
Senator WILEY. It will define the activity of the gangs, so it does not just cover gambling and slot machines?
Mr. PETERSON. Oh, no.
Senator WILEY. It goes into the major crimes and the effect upon the lives of the citizens in the various communities, and so forth?
Mr. PETERSON. Of course, the .significance of the organized-crime problem is its effect on government. In other words, as the distinguished Governor just mentioned a few moments ago, there is very seldom any political campaign in his area in which the racketeering elements—and, of course, gambling is very lucrative—do not attempt to make political contributions and that sort of thing. The significance of that is that it then means that successful candidates who depend upon that particular revenue for their election to office then must listen to the racketeering or criminal elements with reference to law-enforcement policies, and some of the law-enforcement officials then are under the control of your law violators. In other words, the law violators dictate law-enforcement policies and control certain law-enforcement agencies. I think that is one of the real significant points of the entire organized-crime problem.
The CHAIRMAN. Mr. Peterson, before you start your formal statement I thought we should have a further word about the American Municipal Association. As I understand it, its membership represents about eleven or twelve thousand communities—cities or local communities. Is that true ?
Mr. PETERSON. I believe it represents 10,300 municipalities and cities.
The CHAIRMAN. At their meeting last year where you made a report, I believe it was, in Cleveland, Ohio.
Mr. PETERSON. That is correct.
The CHAIRMAN. At that meeting the American Municipal Association passed by unanimous vote a resolution stating that they felt that this was a matter in which in some instances they needed the cooperation of the Federal Government in helping them in their law-enforcement problems, and they asked for an investigation by some Federal agency or by Congress. Is that not true ?
Mr. PETERSON. Yes, sir.
The CHAIRMAN. I might say that that resolution was one of the reasons that I happened to file the resolution in the early part of this Congress. Mr. Peterson, you may proceed for about 15 minutes and then we will recess until 2 : 30.
Mr. PETERSON. In the first place, in order to have an understanding of organized crime in America today, it is necessary to review the growth and development of some of the major criminal gangs of approximately three decades ago. The real beginning, of course, is much earlier, but many of the most important criminal gangs operating throughout the country today stemmed from the major gangs operating in Chicago and New York City, in particular, about 30 years
For convenience, we might refer to the New York mob as the Frank Costello gang and the Chicago gang as the Capone syndicate. Naturally, this constitutes an oversimplification of the problem, but it really is surprising when there is a full realization of the tremendous influence these two organized gangs still wield throughout the Nation today.
For the sake of clarity, I am going to review very briefly the Capone syndicate.
On May 11, 1920, Big Jim Colosimo was killed in gangland fashion in Chicago. He had risen to power and influence through the operation of a string of brothels to become the vice lord of the first ward and had married one of the most prosperous madams of the district. He became the operator of a restaurant known as Colosimo's, which was located at 2136 South Wabash Avenue. Colosimo's Restaurant become nationally famous. Several years before he was killed, Colosimo had imported to Chicago a bodyguard by the name of John Torrio. Some sources claimed that Torrio, who had already established himself as a tough gangster in New York, was sent to Colosimo by Frank Uale. All of you remember him undoubtedly. He was a ruthless gang leader in New York City. That is spelled U-a-l-e or, commonly, Y-a-l-e.
When Colosimo was killed in 1920 there was some justification for the claim that Torrio had imported Frank Yale to commit the murder. Regardless of the truth of that allegation, it is definitely known that, upon the death of Colosimo, John Torrio became the lord of Chicago's underworld.
As an interesting sidelight, at the time Colosimo was killed in Chicago, a United States Senate Judiciary hearing was in progress relating to the Sterling-Sims bill which was designed to prohibit the interstate transportation of racing information. On May 10, 1920, testimony was given before the Senate Judiciary Committee to the effect that Chicago was the center of race-track information for the entire United States.
On May 12, 1920, the press reported that the Chicago headquarters for race information for the entire United States was located in the office of the General News Bureau operated by Mont Tennes at 431 South Dearborn Street, Chicago. In 1950 the Chicago headquarters for Continental Press, which disseminates racing-news information throughout the United States, is located at 431 South Dearborn Street, Chicago. Conditions haven't changed too much in the last 30 years insofar as that situation is concerned.
When Torrio became the leader of Chicago's underworld upon the death of Big Jim Colosimo on May 11, he selected, as his chief lieutenant, Al Capone, then 23 years of age. Capone had already established himself as a tough gunman with the Five Points gang of New York City. The headquarters for the Torrio mob was at the Four Deuces, 2222 South Wabash Avenue, Chicago. The first floor contained a saloon, cafe, and the office of Torrio. The second and third floors were devoted to gambling and the fourth floor to prostitution. Torrio even actually envisioned a vice monopoly for the entire county. In particular, he became entrenched in a Chicago suburb called Burnham, Ill., with the assistance of John Patton, who became known as the boy mayor of Burnham. Among the earlier subordinates of Torrio was Jack Guzik, who was later to become the business manager of the gang during the heyday of its operations, and he has asserted a considerable amount of influence in Chicago up until the present time.
On April 1, 1924, there was virtually an armed invasion of Cicero. Ill. Through Edward Vogel, plans were made for the underworld organization headed by Torrio to elect its ticket in the mayoralty election. During the past three decades, until the present time, Edward Vogel is known as the slot-machine king of Cook County, and throughout that period has been an important member of the so-called Capone syndicate. On the date of the election April 1, 1924, the Torrio-Capone gang manned the polls with machine guns. There was a considerable amount of violence, and Frank Capone, a brother of Al, was killed during a gun battle between the hoodlums and the police. Charlie Fischetti, one of the leading gangsters in America today, was present with Frank Capone and other hoodlums during the time the election violence was in progress. Charles Fischetti, a cousin of Al Capone, continued to grow in stature in the syndicate until the present time, when he is unquestionably one of the most important underworld characters in the Nation. Following the 1924 election, Cicero became the headquarters for the Torrio-Capone combination, and an influence of the members of this organization has been strong until the present time.
In April 1924 a raid was made on a brewery—Sieben Brewery— operated by John Torrio and his gang. Torrio was arrested and so were numerous other individuals. They were indicted. Some time later Torrio was sentenced to serve 9 months in the Du Page County Jail and received a $5,000 fine. But just before he began serving his sentence he was ambushed and shot. He was taken to the Jackson Park Hospital in Chicago, where he recovered. After his recovery he served his jail sentence and then he abdicated his underworld throne in Chicago to Al Capone. As I will show you later, he then became tied up with Costello in New York.
On April 7, 1925, the press reported a raid on the headquarters of the Torrio-Capone gang, which was then located at 2146 South Michigan Boulevard. Arrested in this raid were John Patton, Robert Larris McCullough, Joe Fusco, Frank Nitti, and others. The police recovered records which revealed that John Torrio, John Patton, Al. Capone, and Jack Guzik, together with others, were operating an efficient illegal organization which was engaged in operations netting millions of dollars a year.
Mr. HALLEY. Mr. Peterson, some of the names that you have just mentioned are still operating; are they not?
Mr. PETERSON. That is correct. In other words, I am paving the way to show that these men are still prominent—not all of them. Nitti, of course, has committed suicide, and John Patton, of course, is an old man, but these other people that I am mentioning —most of them—are active today. Of course, Torrio is no longer active.
Mr. HALLEY. Isn't Patton active in Florida ?
Mr. PETERSON. Up until 1941 his name appeared as one of the stock-holders of some of the dog tracks down there. He is still apparently active. The stock is in his son's name at the present time, James Patton ; and Robert Larry McCullough, for example, whom I mentioned here, has been the chief of police of the Miami Beach Kennel Club down there to help them maintain law and order, I guess. I don't know.
The CHAIRMAN. Mr. Peterson, you have notes that you are following. I wish it were possible to have copies of these notes for the benefit of the press. I know it is very difficult for them to follow this.
Mr. PETERSON. Unfortunately, I was under such pressure in trying to get ready; in fact, I just finished dictating it yesterday before I left and I didn't have extra copies. I have the one extra copy that I gave to your committee here.
The CHAIRMAN. I wonder if during the lunch hour, from the point where Mr. Peterson leaves off, copies could be made. It would be a pretty fast mimeographing job.
Mr. KLEIN. I don't think it could be done, Senator.
Mr. HALLEY. Mr. Peterson also explained that there are some names in the statement that he has there that he would not want to make public, but will give the committee privately. The committee should know that that Mr. Peterson made every effort to have a copy of his statement that could be made public in the committee's hands by yesterday, so it could be mimeographed, but he found that the pressure of work was such that he just could not do it. It is quite a long statement, and it is understandable that he couldn't do it; but he did try to do it. (Discussion off the record.)
The CHAIRMAN. Mr. Peterson, we will recess at about 12: 25 if you can find some place where you can stop.
Mr. PETERSON. I will be glad to do that. There is just a little bit left leading up to the background of the Capone gang here, and then perhaps that would be a good breaking off point.
The CHAIRMAN. All right, Mr. Peterson.
Mr. PETERSON. After John Torrio left Chicago about 1929 is when Al Capone became the ruler of Chicago's underworld. One of the early bodyguards of Capone was Louis (Little New York) Campagna. Campagna originally came from New York City, and at first it is claimed that he hung around Taylor and Halsted Streets in the old "bloody twentieth" ward in Chicago. Torrio had built up power for his organization of gangsters, and this was taken over by Capone and became even more powerful as time elapsed. On February 14, 1929 -- I am sure you are all familiar with the St. Valentine's Day massacre in Chicago. Apparently, Capone gangsters intended to kill Bugs Moran, Willie Marks, and Ted Newberry, all of whom were North Side underworld leaders. The investigation conducted by the police revealed that until 3 days before the massacre Guzik had been holding daily long-distance telephone conversation with Al Capone in Florida. Jack Guzik was then the business manager of the illegal empire controlled by Capone. Among the numerous individuals sought by police as suspects—and they were just suspects—were Tony Accardo, Claude Maddox, and Tony Capezio.
The activities of the Capone gang consisted principally of illegal liquor racket, gambling, and allied activities such as dog racing. The Capone gang was vitally interested in a track in Chicago known under two names, namely, the Laramie Kennel Club. In connection with the investigation of the St. Valentine's Day massacre in Chicago in 1929, testimony was taken concerning the sale of a machine gun. The vendor of the gun testified that he had sold a machine gun to Edward J. O'Hare, who was then manager of the Hawthorne Kennel Club and who actually became the czar of dog racing for the Capone syndicate.
The Chicago Daily News on April 30, 1929, stated, reporting the testimony :
Three witnesses supplied the testimony regarding the machine-gun deal through the Cicero police with the Capone dog track, which was owned by John Patton, boy mayor of Burnham, and Jack Guzik, business manager for Capone. * * *
In the autumn of 1931 Al Capone was brought to trial in Federal court for income-tax evasion. Capone's bodyguard at that time was Phil D'Andrea, who, true to form, appeared in court with a concealed weapon and was sentenced by a. Federal judge to 8 months in jail for contempt of court. Phil D'Andrea, as you know, was recently—in 1943—convicted with other Capone gangsters in the movie extortion case. When Capone was, committed to Federal prison, Frank Nitti became the head of the Capone gang. At the time Capone went to prison the following individuals had grown in stature within the Capone organization and were powerful members of the Capone syndicate: Frank Nitti, Louis (Little New York) Campagna, Paul Ricca, Phil D'Andrea, Jack Guzik, Tony Accardo, Charles Fischetti, Edward Vogel, Hymie (Loud Mouth) Levin, Ralph Capone, Tony Capezio, Ralph Pierce, Murray Humphreys, Frank Maritote, alias Frank Diamond, Nick Circella, alias Nick Dean, Lawrence Imburgio, Charles Gioe, Anthony (Mops) Volpe, William Niemoth, and Sam (Golf Bag) Hunt. Most of these individuals are still important members of the Capone syndicate in 1950. Numerous others have grown to power and have become influential within the organization. The operation of the gang has been extended to many places in the United States, and important alliances have been made from time to time with the powerful underworld leaders in other parts of the country, particularly with members of the so-called Frank Costello gang in New York.
That gives a brief background of the beginning of the Capone syndicate.
The CHAIRMAN. Mr. Peterson, I think we will interrupt your statement at this point.
For the information of the press and others here, the committee will continue with Mr. Peterson's statement at 2 : 30 this afternoon in this room, but his statement will be interrupted at 3 : 15, at which time Mr. William Brown, the president of the Pioneer News Service, will testify. Mr. Brown has been here since yesterday and wants to go back home tonight.
The committee will stand in recess until 2 : 30.
(Whereupon, at 12: 25 p. m., the committee recessed until 2 : 30 p. m. the same day.)
(The committee reconvened at 2: 30 p. m. pursuant to the taking of the noon recess.)
The CHAIRMAN. The committee will come to order. Mr. Peterson, will you continue with your testimony, please?
FURTHER TESTIMONY OF VIRGIL W. PETERSON, OPERATING DIRECTOR, CHICAGO CRIME COMMISSION, REPRESENTING THE AMERICAN MUNICIPAL ASSOCIATION
Mr. PETERSON. In the early 1920's while the Torrio-Capone organization was flourishing in Chicago, the principal underworld leader in New York City was Arnold Rothstein. He was frequently referred to as the master mind of the underworld. He financed many important underworld leaders in their activities, and among those who were close to Rothstein and who benefited from his financial assistance were Frank Costello, Eddie Costello, a brother of Frank, George Uffner, a dealer in narcotics who was closely associated with Charles "Lucky" Luciano and Dandy Phil Kastel.
The CHAIRMAN. Mr. Peterson, at that point, that is a statement of fact, and how do you know that ?
Mr. PETERSON. Through our files and through research. That information, of course, has been a matter of public record over a long period of time.
The CHAIRMAN. You do have factual data to back up every statement of fact that you make before the committee?
Mr. PETERSON. That is right.
During World War I Kastel was engaged—as a matter of fact, he has been convicted—was engaged in many illegal operations. He was once charged with the time-worn badger game. He was tried and acquitted of that charge and was represented by Rothstein's attorney. Until 1921 Kastel had operated a bucket shop under the name of Dillon & Co., which it was claimed resulted in swindling clients out of approximately a half million dollars. He was convicted and sentenced to prison. When Kastel came out of prison he became a partner and associate of Frank Costello. Kastel, incidentally, was also a friend of Nickie Arnstein.
During the 1920's and the early 1930's Frank Costello numbered among his associates such individuals as Louis Lepke Buchalter, Dutch Schultz, Arnold Rothstein, Joe Adonis, Owney Madden, and Willie Bioff, who incidentally testified at the moving-picture extortion trial that Costello was a member of the conspiracy through which he and George Brown had obtained control of the stage-hands' union.
As a sidelight, from about 1922 to 1931 Joe Masseri was the head of the underworld activities of what is frequently called the Mafia. He was known as Joe the Boss, and was head of the Italian lotteries and similar illegal activities. One of his lieutenants was Charles "Lucky" Luciano, who allegedly succeeded him as head in about 1931.
From 1928 to the early 1930's one of the most powerful gangs operating New York City and on the East coast was composed of the following individuals : Frank Costello, Joe Adonis, Benjamin "Bugsy" Siegel, John Torrio, the abdicated king of the Capone syndicate, Dutch Goldberg, Abner "Longie" Zwillman, Meyer Lansky, Charles "Lucky" Luciano, Moe Sedgwick, alias Little Moe, Jack Levenson, Charles Haim. and Louis Pokrass, and a number of others. Most of those activities of course were in the bootlegging field. Benjamin "Bugsy" Siegel, Meyer Lansky, and Charles "Lucky" Luciano were said to be the enforcers for the gang and they engaged in terrorizing tactics as enforcers. As I said before, until the repeal of prohibition the principal activities of this group were related to the illegal liquor traffic. Many of them remained in the same field following prohibition. Many of the group of course were big-time operators in the field of gambling. As early as 1932 Joe Adonis, Frank Erickson, and others were promoting a big sweepstakes operation. In 1933 Adonis sent his representative to Chicago to help reorganize the Manhattan Brewery. The representatives of Joe Adonis remained in the Chicago area for about. 4 or 5 months in connection with the reorganization. Torrio had previously been connected with this brewery during prohibition. It was claimed that Joe Adonis had an interest along with members of the syndicate. It thus appears that as early as 1933 there was a close collaboration between the Joe Adonis-Frank Costello mob in New York and the Capone syndicate in Chicago. As previously indicated, Frank Costello, Joe Adonis, John Torrio, and other members of the gang gained control of legitimate liquor business. At one time they succeeded in having their representative placed at the head of State-wide trade associations and through their influence they were able to have their representative elected to the liquor code authority under the old NRA. During this period the Capone syndicate---
The CHAIRMAN. Mr. Peterson, what was the State-wide association ?
Mr. PETERSON. That was a liquor association.
The CHAIRMAN. I mean the one before that, the tourists' association.
Mr. PETERSON. No, it was a State-wide trade liquor association. I have the details of that in our files which I can make available to you.
The CHAIRMAN. Is that the name of the syndicate?
Mr. PETERSON. No, that was not the name. That is a generalization. I have the exact name of the association in our files which I will make available to you if you want it.
The CHAIRMAN. Thank you.
Mr. PETERSON. During this period the Capone syndicate was virtually in control of dog racing throughout the Nation. The New York group was also interested in this racket, and at a single session of one legislature they claimed they spent the sum of $100,000 in an effort to secure favorable legislation.
In 1930 Costello and his lieutenant, Dandy Phil Kastel, were associated with Irving Hain. Kastel received large sums of money for the promotion of William Whitely liquors in the United States through the Alliance Distributors, which was controlled by Irving Haim in 1934 Costello obtained the agency contract for Whitely brands which he transferred to Alliance Distributors, of which Irving Haim was the principal owner. In 1937—
The CHAIRMAN. Mr. Peterson, what are the Whitely brands ?
Mr. PETERSON. That is the King's Ransom Scotch. That was what it was. There again there are documents in connection with hearings held in New York concerning that matter.
In 1937 Haim negotiated the purchase of this J. J. Dailey & Son, Ltd., holding company of William Whitely & Co., distillers. The purchase was made in the name of Irving Haim and the money was obtained from a New Orleans bank on notes secured by Irving Haim, Phil Kastel, Frank Costello and William Helis. Dandy Phil Kastel and Frank Costello were also engaged in large-scale slot-machine activities. In New York the company was known as the True-Mint Co. When Mayor LaGuardia conducted his campaign against the slot-machine operations of Costello and Kastel in New York, they negotiated with officials of Louisiana and began large-scale slot-machine operations there. In Louisiana they organized the Pelican Novelty Co. together with a number of subsidiary companies, one of which was the Bayou Novelty Co. They began operations in Louisiana in 1934, and it is claimed that the first year of their activities there netted them about $800,000. Although the purpose of permitting the slot machines originally was allegedly for charity, it is also claimed that charity received only about $600.
Getting back to the Capone syndicate, I think it might be important briefly to give you a brief background of some of these individuals who are now the leaders of the Capone syndicate.
Charles Fischetti is one of the most important members of the syndicate at the present time. As a matter of background, he is a cousin of Al Capone and has been an important member of the syndicate for the greater part of three decades. He owns a home, in addition to his address in Chicago at 6471 Allison Road, Miami, Fla., Allison Island. He also maintains a residence address at, 3100 North Sheridan Road in Chicago, where his brothers, Rocco and Joe, live. He has been arrested numerous times. In addition to maintaining close contact with various prominent members of the syndicate in Chicago, he has associated with John and Fred Angersola, usually referred to as John and Fred King, from Cleveland. This association recently has taken place in Florida. However, that association began before that time, where both the Fischettis and the Kings have spent a large amount of time recently. On the west coast Fischetti has associated with Jack I. Dragna, one of the most powerful underworld leaders in that area. He has also been known to maintain close relations with some of the individuals who have been prominently identified with the underworld on the east coast.
His brother, Rocco Fischetti, sometimes known as Ralph Fisher, has also been a member of the Capone syndicate since the late 1920's. He has been in charge and control of some of the largest gambling establishments in Lake and Cook Counties. For a number of years Rocco Fischetti and a man by the name of Jim Bettinus operated the notorious Rock Garden Club in Cicero, Ill. Following a grand jury investigation in 1943 this establishment moved to Lake County where they controlled the Vernon Country Club, one of the most elaborate establishments in that area. Following the grand jury investigation there they moved back into the Chicago area.
Gus Liebe has served as the manager of many of their establishments, those that are controlled by Rocco Fischetti.
Tony Accardo, frequently regarded as one of the leading members of the syndicate, resides at 1431 Ashland Avenue, River Forest, which is a very choice residential suburb of Chicago. He has also resided at 9199 Collins Avenue, Surfside, Fla., just north of Miami. Since Frank Nitti committed suicide in 1943, Tony Accardo has frequently been considered the leader of the Capone syndicate. In 1946 James M. Ragen, who was then part owner and manager of Continental Press, made a signed statement to the State's attorney in which he alleged that Tony Accardo, Murray Humphreys, and Jack Guzik, all of them members of the syndicate, attempted to muscle him out of 40 percent of the proceeds of the Continental Press, a racing information news service covering the entire United States. Ragen was then ambushed and shot on June 24, 1946, and later died. The Capone syndicate then formed its own racing news information service which was called the Trans-American Publishing & News Service, Inc. Accardo, as I mentioned before, was one of the alleged plotters of the St. Valentine's Day massacre in 1929. He was picked up, arrested, following that. In 1931 the crime commission named him as a public enemy. He has been arrested in Chicago on numerous occasions. In connection with the Federal parole of Paul Ricca, "Little New York" Campagna, Charles Gioe, and Phil D'Andrea, Accardo was indicted in Federal court in Chicago. He had visited Ricca and Campagna in Leavenworth Penitentiary under the pretext that he was an attorney and used the name of Joseph Bulger, a Chicago attorney.
Tony Accardo has operated gambling places in Chicago in partnership with both Harry Russell and Dave Russell, and he has also been a partner of Lawrence Imburgio. Among his other partners in gambling enterprises is John Patrick Borcia, whose activities extended from Chicago to California, where he has been operating the Primrose Bar, which incidentally is a hangout for hoodlums. Early in 1950 the Los Angeles Police Department was seeking Jack I. Dragna, one of the most notorious gangsters on the west coast. A confidential address book was seized from Dragna's principal lieutenant, Giroloma Adamo, alias Mo Mo. This book contained the addresses and names, in many instances the private telephone numbers, of some of the leading underworld characters in the Nation. Among the names contained in this book was that of Tony Accardo, together with his residence address in River Forest, Ill. The book also contained the name of Joe Batters, which is the name frequently used by Accardo. Tony Accardo's brother, Martin L. Accardo, has recently resided at 1217 Granada Boulevard, Coral Gables, Fla. He is a felon, having been sentenced to the Federal penitentiary to serve 1 1/2 years for violation of the National Prohibition Act in 1932.
Paul Ricca, 812 Lathrop Avenue, River Forest, Ill., is frequently considered the top ranking member of the Capone syndicate. Since his parole from Federal penitentiary in 1947 he has naturally kept in the background. Paul Ricca, together with several other members of the Capone syndicate, including John Roselli of the west coast, and Louis Kaufman on the east coast, conspired to extort a million dollars from the movie industry. They were convicted in Federal court in New York City in 1943.
Senator WILEY. What did you say they did to the movie industry ?
Mr. PETERSON. They conspired to extort a million dollars from the movie industry. They were convicted in Federal court in New York City in 1943.
The CHAIRMAN. That is the so-called Bioff-Brown case.
Mr. PETERSON. That is right. They were also mixed up in that case.
In 1940 a temporary injunction was granted to George McLane on the petition that hoodlums were attempting to take over the financial affairs of the Bartenders and Beverage Dispensers Union, Local 278, in Chicago. Named in the injunction were Louis Romano, president of the union, Frank Nitti, Murray Humphreys, Louis "Little New York" Campagna, Fred Evans, and Paul Ricca. At that time McLane alleged that he had been told previously by some of the gangsters, namely Frank Nitti, Paul Ricca, and Louis Campagna, that they wanted to take over control of the union in order to loot the treasury. In 1943—
Senator WILEY. What was the result of that ?
Mr. PETERSON. I think the union was thrown into receivership. There was also an indictment returned at that time and when the case went to trial, George McLane then took the witness stand and said he refused to testify on the ground—he exercised his privilege. I don't know whether it was on the ground of self-incrimination, but it was on some ground, and of course the whole case blew up because the case depended quite largely on the testimony of George McLane.
Senator WILEY. Were there subsequent developments ? Who is in charge of the union now?
Mr. PETERSON. I think a man by the name of Crowley is the business agent of the union at the present time. He, incidentally, was shot in Milwaukee a couple of years ago.
Senator WILEY. He got shot or was shot.
Mr. PETERSON. I think he was shot in connection with a union election out there.
Senator WILEY. How many years ago was that?
Mr. PETERSON. Time goes fast. I would have to check. I think it was 2 or 3 years ago.
The CHAIRMAN. You say that happened in Wisconsin?
Mr. PETERSON. I am not sure. They were holding the election in Milwaukee. I think he was shot in Chicago, as a matter of fact. I am not positive about that. I would have to check on that.
Senator WILEY. Anyway he wasn't a Wisconsin citizen.
Mr. PETERSON. That is right. I give you a clean bill of health on that.
In 1943 the newspapers charged the Nitti-Ricca-Campagna combine had cleaned out the treasury of the Retail Clerks International Protective Association, Local 1248. Max Caldwell, alias Max Pollack, an ex-convict, had been in charge of the union funds. A union representative testified that out of $910,000 collected by Caldwell as the union representative, he could find only about $62. Pollack associated with numerous other members of the Capone syndicate, and it was customary for him to take them on airplane trips from Chicago to Miami. Max Caldwell incidentally is presently located in Miami.
Senator WILEY. What union was that?
Mr. PETERSON. That was the Retail Clerks International Protective Association, Local 1248. Caldwell was then kicked out of the union.
Senator WILEY. Did they ever recover any of it?
Mr. PETERSON. No; not to my knowledge.
Senator WILEY. That was before the Taft-Hartley Act, in 1943.
Mr. PETERSON. Yes ; it was in 1943.
Paul Ricca, among other property, has a summer estate located near Long Beach, Ind., worth about $75,000. He is supposed to have a farm in Kendall County, Ill., about 1,100 acres there, which has been managed or was during the war by Francis Curry. Ricca frequently has used the name of DeLucia, and the owner of record of the property in Long Beach, Ind., is in the name of Nancy DeLucia. In 1943 Ricca had a suit pending against the tenant and owner of a downtown building for personal injuries suffered during an elevator fall. At the time of the accident Ricca was in the company of Charles Fischetti and Joseph Fischetti. Ricca apparently was born in Naples, Italy, about 1899. It is claimed that he served in the Italian Army during the First World War. His first employment upon coming to Chicago was that of a waiter in a coffee shop on Halstead Street and later as a waiter in a restaurant on Wabash Avenue near Harrison, where Frank Nitti and other hoodlums frequently gathered. Nitti was attracted to Ricca, so the story goes, because of his intelligence and induced him to work at the Lexington Hotel which was a Capone gang headquarters, as a confidential aid to Nitti. From that time on, Ricca became influential in the inner circles of the Capone organization. It is stated that Ricca came to this country about 1920 and that his name in Italy was Magleo or Maglio. Frank Costello of New York has admitted having an acquaintanceship with Ricca several years ago.
Louis "Little New York" Campagna, 2927 Maple Avenue, Berwyn, Ill., also has farms in Berrien Springs, Mich., and Fowler, Ind.
Campagna was one of the early bodyguards for Al Capone. At one time it was believed that he would eventually succeed to Al Capone's shoes, although he never actually gained that status. Unquestionably, however, he is one of the top ranking members of the syndicate and has operated within the inner circle of that organization for almost three decades. On July 10, 1936, the Chicago press carried an article to the effect that Frank Nitti, State Representative James J. Adduci, and Louis "Little New York" Campagna had been placed under police surveillance as leaders of the revived Cammora to control gambling, bootlegging, and all other rackets in. Chicago. The three named were under investigation following the murder of State Representative John M. Bolton, who was killed on July 4, 1936. Campagna was one of those restrained in that order that I mentioned a few moments ago from looting the treasury of the Bartenders and Beverage Dispensers Union, Local 276 in 1940. Campagna was convicted in Federal court in New York City again with Paul Ricca and John Roselli from California and Louis Kaufman from the East, and others. Again that was the movie extortion plot. Campagna was paroled from the Federal penitentiary on August 13, 1947, together with Paul Ricca and Charles Gioe. They were later returned to the penitentiary. However, they were subsequently released as a result of court action and are presently on parole pending appeal. At least, they were, the last that I inquired. The Circuit Court of Appeals for the Fifth District, New Orleans, has ordered that, Campagna and Gioe be returned to the penitentiary, but there is still further legal action pending. Campagna has made a fortune from gambling activities in Cook County. He has been affiliated in gambling activities with Willie Heeney, an important figure in Cicero, Joseph Corngold, alias Fifke, of the El Patio gambling establishment, 5914 West Cermak Road, Cicero.
Senator WILEY. Did they return what they made on Federal income tax returns?
Mr. PETERSON. I believe there was testimony introduced in the congressional hearings with reference to the parole a year ago. I don't recall the exact figures, but I believe that Ricca admitted in testimony there that he got between $50,000 and $100,000 a year. This is from recollection. I don't remember the exact testimony. I think Campagna indicated that he got around $200,000 as his share.
Senator WILEY. What did their tax returns show?
Mr. PETERSON. I don't know.
The CHAIRMAN. The testimony you refer to was before the Hoffman committee ?
Mr. PETERSON. That is right. I am giving this from memory as far as what they testified to, but that is my recollection.
Senator WILEY. Did the Federal Government take any action for the collection of back taxes ?
Mr. PETERSON. Prior to the time they were released I think there were back taxes on the part of Campagna and Ricca to the extent of about $500,000, as I recall. They settled it for about 20 cents on the dollar. That was before the paroles. They settled for around $100,000. That was at the time when all this mysterious money was dumped in on Eugene Burnstein's desk in Chicago and they paid off these so-called back tax claims. That was prior to the time they were released from the penitentiary.
Senator WILEY. What year was that?
Mr. PETERSON. 1947.
That was in testimony before the Hoffman committee. Mr. Lahey said that Heeney testified that "Little New York" Campagna got 60 percent out of this joint I mentioned and Corngold got 15 percent. That is out of Cicero gambling joints. That was their testimony. Thank you.
Tony Capezio, "Tough Tony," resides also in River Forest, Ill., 1048 Ashland Avenue, and has been considered a member of the Capone mob since about 1929. During the Dillinger investigation, incidentally, he was one of the principal contacts with "Baby Face" Nelson, the most notorious killer of that gang. He is about 47 years of age and resides with his wife, Marie Capezio at the above address. Capezio's wife Marie is the sister of Frank Nitti, former head of the Capone mob. Tony Capezio was one of the suspects in the St. Valentine's Day Massacre in Chicago in 1929 and was also a suspect of the murder of Mike DePike Heitler. He was a brothel house owner, and I think he was killed around 1930.
Senator WILEY. You say Ricca was born in Italy. Are the rest of them American citizens?
Mr. PETERSON. I think they are all citizens within my knowledge. Some of them may not be, but I don't know. Our files would probably show whether they are or not.
Capezio has also been closely associated with John I. De Biase alias Johnny Bananas, of the Twenty-eighth Ward in Chicago, who has been very powerful there. Tony Capezio's wife is part owner of the Orchid Flower Shop, at 2408 West Chicago Avenue. My recollection is that Campagna's wife is also a part owner of that shop. I would have to check that, however.
He is also allegedly owner of a cocktail lounge and there have also been allegations, which have not been proved, that he has an interest in a currency exchange. For the past 20 or 25 years Capezio has been a friend of Claude Maddox, an important syndicate member who has operated primarily in Cicero, Ill. He has been arrested with Claude Maddox as well as with Rocco De Grazio, Fred Rossi, and others. Allegations were made a number of years ago that—these were public allegations, never proven—that Maddox and Capezio were active in attempting to control Local 705 of the Teamsters and Chauffeurs Union. Capezio has been engaged in big-time gambling operations in Chicago.
Jack Guzik, another member of the syndicate, was the business manager of the Capone syndicate or was called such during the heyday of Al Capone's regime in Chicago. He has been prominently identified with big-scale gambling by James M. Ragen up until recent years. In 1946 it was alleged in a statement made by James M. Ragen to the State's attorney that Guzik, together with Tony Accardo and Murray Humphreys as representatives of the Capone syndicate were attempting to muscle into the Continental Press. Jack Guzik was very close to Al Capone until the time he died. Jack Guzik's son-in-law, Frank Garnet, has been very prominently identified with the distribution of juke boxes in Illinois and recently in California. Guzik's brother-in-law, Louis Lipschultz, has been active in Cook County. About 1948 Louis Lipschultz, according to the chief of police of Cicero, Ill., contacted him and offered him $100,000 to permit gambling to operate in Cicero. The offer was turned down. Lipschultz at that time said he was merely a spokesman for friends. In 1936 Lipschultz---
The CHAIRMAN. Did he admit making the offer?
Mr. PETERSON. It was just between Lipschultz and the chief of police. I don't think he was ever confronted by anybody with it. The offer was turned down. The chief of police made the statement that he made that offer to him.
In 1936 Lipschultz, who was then residing at 4342 Ogden Avenue, pled guilty to income tax evasion in Chicago court and was fined $500 and paid $7,000 in a compromise settlement. In the income tax hearing there it was claimed that Lipschultz then received a gross income of $107,111 from the Harlem Tavern in Stickney, Ill., the Stockdale Saloon in Forest View, and the old Hawthorne Kennel Club, which was known as a Capone syndicate enterprise. Jack Guzik's father was naturalized on November 5, 1898, at which time he was apparently 10 or 11 years of age and received his naturalization when his father became a citizen. Jack Guzik himself was charged with evasion of income tax for the years 1927, 1928, and 1929. The Government alleged that Guzik's income amounted to approximately $1,000,000, necessitating a payment in the amount of $250,000 for the years mentioned. In the prosecution of this case the Federal Government produced evidence showing that Guzik then had an interest in numerous gambling houses in Cicero and Chicago, that he owned stock in the Hawthorne Kennel Club which operated as a dog-racing track. On November 20, 1930, he was found guilty and sentenced to a term of 5 years in the Federal penitentiary and fined $7,500. Until recent years Guzik has been associated with Hymie "Loud Mouth" Levin in gambling enterprises. Levin was an important cog in the Capone organization during the heyday of Al Capone. Guzik has also been associated with Frank "Chew Tobacco" Ryan, Rocco Fischetti--
The CHAIRMAN. What was that last name?
Mr. PETERSON. He is commonly known as Frank "Chew Tobacco" Ryan. He is a well-known gambler in Chicago for the past probably 30 years, I guess, and his last name is Ryan. Rocco Fischetti, Sam Hunt, and Murray Humphreys also. All of those are well-known syndicate members.
Gus Alex in recent years has become an important figure in the syndicate and has been particularly close to Jack Guzik. He is the son of a restaurant owner. He has been arrested on numerous occasions but has never been convicted or retained in jail for any length of time. In 1944 Gus Alex, age 30 years, 4000 West Washington Boulevard, was arrested, together with Willie Niemoth, in connection with the shotgun wounding of Robert Bock. The arrest was merely one on suspicion, and they were released. In 1943 Gus Alex was reputedly the owner of a gambling establishment at 2136 South Michigan Avenue, in which dice, roulette wheels, and other gambling was conducted. In 1944 it was alleged that Gus Alex, Hymie Levin, Gus Liebe, and others were connected with the notorious gambling. establishment called the Dome at 7466 West Irving Park Road. Gambling is unquestionably closely associated with the top-ranking members of the syndicate. In 1944 the chief of the Cook County Highway Police had Alex under surveillance at which time he visited the home of Tony Accardo, in River Forest, Ill.
Edward Vogel has also been known as the slot-machine king of Cook County. He has been associated with Capone gangsters for the greater part of three decades. On October 1, 1926, he was indicted, together with Al Capone, the mayor and chief of police of Cicero, Ill., and many others. They were charged in a Federal indictment with having conspired to violate the prohibition laws. It is claimed that. Vogel, among other contacts, did have one George "Babe" Tottenelli, who was the trouble-shooter for Ed Vogel on the south side in connection with slot-machine activities for a number of years. Vogel has been the secretary and treasurer of the Apex Cigarette Service, Inc., 1010 George Street., Chicago.
The CHAIRMAN. What is that company ?
Mr. PETERSON. That company has the cigarette-vending machines where you put in 20 cents and get out a package of cigarettes.
The CHAIRMAN. Is that still operating?
Mr. PETERSON. Yes. This company was chartered in Illinois in December 1937. Vogel also has connections with certain other legitimate enterprises that I can give you in more detail perhaps at a later
Senator WILEY. What is the estimated amount of money he has in those enterprises?
Mr. PETERSON. Of course, in the Apex Cigarette Service Co. he is one of the principal owners as I understand it, but I can't give you an estimate of the amount of money involved in the enterprises. He is supposed to have—I did have the figure on this one company. I might possibly have it here on a legitimate enterprise. I do not seem to have it with me. On one legitimate thing I think his income was supposed to have been $10,000 a year.
The CHAIRMAN. You can get the information and furnish it to the committee later.
Mr. PETERSON. That is right.
Another important member is Murray Llewellyn Humphreys, alias J. Harris, known as "The Camel," 7710 Bennett Avenue. Without any question he is one of the leading members of the syndicate. He, together with Tony Accardo and Jack Guzik, have attempted to muscle into the Continental Press according to a statement made by James M. Ragen in 1946, and you will recall that shortly thereafter Ragen was ambushed and shot and later died. Murray's first conflict with the law occurred in 1918 when he was arrested as John Humphreys on a charge of burglary. On a plea of guilty to petit larceny he was sentenced to the house of correction for 6 months. Since that time Humphreys has been arrested on numerous occasions in connection with labor racketeering, gambling, and vice activities. Among the various Capone hoodlums with whom Humphreys has been arrested is Ralph Pierce, who was also a defendant in the movie-extortion trial involving Capone syndicate members.
Humphreys has also been involved in kidnaping. In 1922 Humphreys was associated with the Meadowmoor Dairy. It was also alleged at that time that Humphreys and other hoodlums were attempting to muscle in to a milk-drivers union. In 1932 it was alleged that Humphreys and others were attempting to dominate the teamsters union. In March 1933 Humphreys and Charles Fischetti were taken into custody for questioning with reference to the murder of the secretary of the Hoisting and Portable Engineers Union, local 569. Of course, both denied any implication and they were released. On May 2, 1933, the chief investigator for the State's attorney's office described Humphreys as public enemy No. 1 and the czar of business rackets in Chicago. It was alleged by the State's attorney's office that Humphreys through his control of certain labor unions had forced the cleaning and dyeing industry and the laundry industry to pay tribute to him. On June 27, 1933, Humphreys was indicted by the Federal grand jury in Chicago on a charge of income-tax evasion. On July 28, 1933, Humphreys, Al Capone, and 22 others were indicted by the Cook County Grand Jury on charges of conspiracy to control the cleaning and dyeing industry and the carbonated beverages and linen supply industries, through kidnapings, strikes, bombings, and acids. Seventeen of the defendants were found not guilty and the charges against Humphreys, Al Capone, and others were stricken off with leave to reinstate by the prosecutor's office. On October 27, 1934, Humphreys pleaded guilty to income-tax evasions and was sentenced to serve 18 months in the Federal penitentiary and was fined $5,000.
Later in a hearing before the United States Board of Tax Appeals beginning in January 1939 to determine the amount of income tax and penalties owing by Humphreys, testimony was given that in addition to the income received from various sources Humphreys received $50,000 ransom paid by the milk wagon drivers union for the release of Robert C. Fitchie in 1931. The United States Government was insisting that this $50,000 be included in Humphreys' income-tax returns. Humphreys was also one of those against whom an injunction was issued in 1940 that I mentioned a short while ago to the Bartenders and Beverage Dispensers Union, Local 278. He was later indicted in connection with this matter, but not convicted.
In 1941 he had an interest in the Individual Towel Co. which at that time had a $45,000 annual contract with the Chicago Board of Education, resulting in action by the State's attorney's office. In recent years Humphreys has been associated with Guzik, "Little New York" Campana and many other prominent members of the Capone syndicate. As of 1940 he was an executive of the Midwest Oil Corp. which apparently was dissolved about 1941. He also has been associated with important racketeers in various parts of the country. I mentioned a short while ago the records recovered by the Los Angeles Police with reference to Jack I. Dragna and his lieutenant, Mo Mo Adamo. Among the secret names and addresses of underworld characters found in that address book was that of Humphreys, who was listed as J. Harris, 7701 Bennett Avenue, Chicago. That is the name that his private telephone number also was listed under.
The CHAIRMAN. Mr. Peterson, are you at a place where you can pause for the time being?
(Mr. Peterson's testimony was interrupted while the committee took testimony from William P. Brown, Clayton, Mo. Mr. Brown's testimony is included in part 4 of the committee's hearings.)
The CHAIRMAN. Mr. Peterson's statement will take approximately 4 or 4 1/2 hours more and he has to leave at 5 o'clock tomorrow afternoon; so, much as the committee hates to work overtime and anybody else hates to work overtime, we will have to go on for 30 minutes this afternoon.
The committee is very much interested in your full statement, Mr. Peterson. We will resume in about 5 minutes. (Brief recess.)
The CHAIRMAN. All right, Mr. Peterson, if you will carry on.
FURTHER TESTIMONY OF VIRGIL W. PETERSON, OPERATING DIRECTOR, CHICAGO CRIME COMMISSION, REPRESENTING THE AMERICAN MUNICIPAL ASSOCIATION
Mr. PETERSON. The next individual of importance in the Capone syndicate is Ralph Pierce. He was indicted also by the Federal grand jury in New York City with Paul Ricca, Phil D'Andrea, Nitti, and the others in connection with the movie extortion. Pierce, incidentally, was one of those acquitted. He was indicted for kidnaping in Chicago in 1929, and that case was nol-prossed. He was also one of those arrested in 1935 as a suspect in the murder of Thomas Malloy, boss of the motion-pictures operators' union in Chicago. He was also arrested in 1943 as a suspect in the Estelle Carey murder case in Chicago and in 1945 was arrested for questioning in connection with the murder of James "Red" Forsythe, a notorious hoodlum. He was released in each of those instances. Pierce has been known as a bodyguard for Murray "The Camel" Humphreys and is an associate of Sam "Golf Bag" Hunt, both of whom are stalwarts in the Capone organization. In the past he has spent a large amount of time at Russell's Silver Bar, 400 South State Street, Chicago, operated by Harry Russell, a big shot in the gambling set-up in Chicago and more recently in Florida.
Another individual is Fred Evans, 5000 Marine Drive, Chicago, who was sometimes regarded as the financial brains of the Capone gang. He is an associate of many of the most important members of the Capone outfit, including Nitti, deceased leader of the gang, Murray Humphreys, Paul Ricca, and Louis Campagna. He, Evans, was indicted with these men and Louis Romano and Thomas Panton in 1940 on a charge of conspiracy in the bartenders' union that I mentioned previously. He was not convicted. Evans was born in November 1898 in St. Louis, Mo. It is claimed that he graduated from the school of architects and engineering at the university. In 1923 he operated a garage at 1214 Jackson Boulevard, Chicago, with Murray Humphreys. In 1924 he began operating the Evans Co., at 311 Curtiss Street. Information was received some years ago that Evans was one of several hoodlums who were attempting to gain control of the dry-cleaning industry. It was claimed in particular that Evans had muscled into the Ruby Cleaners, 2801 West Montrose Avenue, Chicago. In 1947 it is known that Evans claimed to be the owner of the establishment. Information was also secured to the effect that Humphreys was a partner of Evans in this enterprise. From 1934 to 1937 Evans was connected with the Equipment Loan & Discount Corp.
On August of 1937 this corporation was merged with the Security Discount Co., 1000 North La Salle Street, Chicago, which Evans was operating at late as 1947.
Another important figure in the Capone syndicate, going on away back to the beginning, was Rosso De Grazio, alias Rocco De Grasse, alias Rocco De Grazia, and his brother, Andrew De Grazio, who were operators of the Lumber Gardens, 101 North Twenty-fifth Street, Melrose Park, Ill. Wide open gambling operations have taken place at this establishment for many years. They recently just built a large addition to it. A few years ago Rocco and Andrew De Grazio were indicted in Federal court in connection with a narcotics charge. In 1935 when Rocco De Grazio was convicted of income-tax evasion he admitted he was operating 18 handbooks, many of which were in Melrose Park, Ill., and he paid $1,200 per month for protection. In 1931 Rocco De Grazio was the leader of the Capone organization in the north and west suburban sections of Chicago. In connection with De Grazio's income tax evasion case, when he was being charged with income-tax evasion, Federal agents seized him at his home at 1049 North Elwood Avenue, Oak Park, in 1934. The Government claimed then that De Grazio had an income over $97,000 in 1929, $51,000 in 1930. In 1946 Rocco De Grazio was believed to have an interest in Rocco Fischetti's Vernon Country Club, a lavish gambling establishment at Deerfield, Ill. In recent years in addition to operating the Lumber Gardens in Melrose Park, he has been in control of the syndicate's football pool operations in Cook County.
Nicholas De Grazia, 121 Twenty-second Avenue, Melrose Park, Ill., has been another important figure in the Capone syndicate's gambling operations. As early as 1932 the press reported that Rocco, Andrew, and Nick De Grazia were in control of slot machines for the syndicate in the western suburbs. On September 25, 1932, a doorman to a road house located on Lake Street west of Mannheim Road was killed. The owner of this place would not allow slot machines in his place and the press alleged that the slaying was intended to intimidate the road house owner. On December 22, 1943, Nick De Grazio appeared as a witness for a defendant in a rape case. He admitted he operated a pool hall owned by his brother and thathewas a poker dealer. The De Grazios. are important figures in the Capone organization.
Sam "Golf Bag" Hunt, whose real name is Samuel McPherson Hunt, has been closely associated with many prominent members of the Capone syndicate including Murray Humphreys, Ralph Pierce, Jack Guzik, Charles Fischetti, and others. Beginning in 1943, following the gang killings of Danny Stanton and Martin "Sonny Boy" Quirk, Sam Hunt became the generalissimo of Chicago's South Side gambling racket. An important lieutenant of Hunt on the South Side is Hyman Gottfreed.
Hunt has been prominently identified with the underworld as a gunman for many years. As an interesting sidelight as to how he got the name, in May 1930 Sam Hunt was arrested in the State's attorney's office as a member of a shotgun squad that kidnaped and wounded a man at Berwyn and Ashland. Hunt was found at the scene with a discharged shotgun in a golf bag. He had been pulled off the automobile that was carrying the victim away. Although indicted on a charge of carrying concealed weapons, the case was nolle prossed by the State on April 10, 1931. He was arrested many times afterward on a charge of carrying concealed weapons. Once in 1933 he received a sentence of 1 year in the House of Correction on a concealed weapons charge. Hunt has been arrested by the police on several occasions following gang slayings but has never been successfully prosecuted. In 1942 Hunt was involved in an automobile accident. An argument followed and the driver of the car was shot and killed. Hunt was wounded. Hunt was indicted for murder and his chauffeur, Hyman Gottfreed, alias Hy Godfrey, was indicted as an accessory. After four trials, Hunt was found not guilty on January 11, 1943. As of 1944, Sam Hunt was allegedly an official of the Drexel Wine & Liquor Co., Thirty-ninth and Cottage Grove Avenue. At that time he lived at 1722 East Seventieth Street, Chicago. As of 1941 he was vice president of the Cook Oil Co. As of 1944 he had addresses at 2233 East Sixty-eighth and 1722 East Seventieth Street, Chicago. His draft card in 1944 which was found on him when he was arrested carried the address of 5123 University Avenue. In 1946 Hunt had an interest in a tavern at Sixty-third and Cottage Grove Avenue, Chicago.
Another individual who has come to the forefront particularly in recent years in Sam "Mooney" Gincanna, 1147 Wenonah Avenue, Oak Park, Ill. In February 1945 he was arrested with Tony Accardo, top-ranking man of the syndicate, and one Daniel Beneduce, of 4259 Gladys Avenue, Chicago, as suspects in a kidnaping. They were released on February 14, 1945, Gincanna gave his age as 36 years and his residence address as 2822 Lexington, Chicago. He was born in Chicago July 16, 1908. About two decades ago he was a member of the notorious "42 Gang." He has a long criminal record. His last sentence being pronounced October 30, 1940, for violation of the internal Revenue Act. He was given a conditional release from the Federal prison at Terre Haute, Ind., in December 1942. When he registered for the draft in World War II Gincanna gave his occupation as that of a salesman for the Central Envelope & Lithographing Co., 426 South Clinton Street, Chicago. This company incidentally is owned by his brother-in-law, M. R. DeTolve, president of the company. He was rejected for military service. He has operated handbooks on the North Side of Chicago and has been the owner of the Boogie Woogie Club, 1709 West Roosevelt Road, Chicago. He is known as a gunman and dangerous. As I said before he has been associated in business activities with Tony Accardo.
Ralph O'Hara is a man who, when the Capone organization formed a Nation-wide news service for racing information in competition with the Continental Press, was virtually the manager of the service. This organization was known as, as I said before, I believe, the Trans-American Publishing & News Service, Inc. On June 13, 1947, O'Hara publicly announced with reference to the Trans-American "We are going out of business. It has been a losing proposition and we can't continue it * * *."
O'Hara was formerly associated with Thomas Malloy in the moving-picture operators union. He was indicted by a Federal grand jury in Chicago in January 1935 as a result of a perjury committed before a grand jury investigating the income tax of Malloy. On July 30, 1931, O'Hara was indicted by the Cook County grand jury on a charge of conspiracy. It was alleged that from June 1, 1928, to the date of indictment, O'Hara had conspired with others to get applications for moving-picture operators through the department of moving picture operators and gas and electricity of the city. No witnesses could be produced and the case was then dismissed. In 1922, O'Hara was business agent for the Chicago Federation of Musicians. He was closely associated with "Big Tim" Murphy, a notorious gang leader. When Big Tim Murphy was sent to Leavenworth Penitentiary after conviction in a mail robbery case, the press reported that O'Hara was, collecting $500,000 in an effort to secure the release of Murphy from prison. Murphy was sentenced in April 1933. At that time O'Hara was working for Thomas Malloy in the Motion Picture Operators Union, which the press described as a $750,000-a-year racket. On March 2, 1933, Ralph O'Hara shot and killed Fred Oser in the office of the Motion Picture Operators Union, 506 South Wabash Avenue, Chicago. O'Hara was then indicted but won a directed verdict on June 7, 1933. On February 4, 1935, Thomas Malloy was shot and killed in one of our gang killings in Chicago. The press alleged that was killed by the Capone gang in order to take over the Motion Picture Operators Union. A short time later Ralph O'Hara became head of the Motion Picture Operators Union of Chicago, Local 110. In recent years O'Hara and his wife spent some time in some of our big hotels down in Chicago.
Another important individual who apparently has had a falling out after the Moving Picture Operators Union, but his name should be remembered, is Nick Circella, alias Nick Dean. He was implicated in the million-dollar movie-extortion case along with the other Capone gangsters. He has been released from Federal penitentiary. He has a brother, August Circella, who has been proprietor of gambling establishments in Chicago. In recent years August Circella owned and operated the Gold Coast Lounge, on North Rush Street. Bookmaking operations were in progress there under his ownership. Several years ago August Circella was one of the owners of the notorious Colony Club on Chicago's North Side. This was a night club which featured big-time gambling. Circella has recently been interested in an air-conditioning unit for which he owns the patent rights.
Phil D'Andrea, who supposedly is in bad health now, formerly the bodyguard for Al Capone, was convicted along with the other Capone gangsters. Released on parole in 1947. At the time Capone was prosecuted for income-tax evasion he was sentenced for contempt of court for carrying weapons in the Federal courtroom. He served 6 months on that charge. In 1932 he was arrested at the Planters Hotel with Frank Rio, Capone's Philadelphia cellmate, Paul Ricca and Michael Costello. In recent months he has been living in California, I believe it is Tarzana, Calif. I think he has a filling station out there.
We reach Al Capone's brothers, Ralph, John, Albert, and Matthew—Ralph and John have been the most active insofar as racketeering activities are concerned. Ralph Capone, brother of Al, was born in Italy in 1894 and brought to the United States when he was about a year old. He claims that he is a citizen. During the 1920's and 1930's Ralph Capone was associated with Al in the operation of gambling houses, houses of ill fame, illegal liquor traffic, and other forms of racketeering in Chicago and Cicero. Ralph Capone spends a large amount of time in Mercer, Wis., where he is said to own a tavern and summer resort. On April 29, 1926, Ralph Capone and Charles Fischetti were arrested in Cicero, Ill. On May 27, Al Capone, Ralph Capone, Charles Fischetti, and other individuals were charged with conspiracy to violate the National Prohibition Act in Chicago. He has been arrested on numerous occasions which include one by the New Orleans police in 1928, by the Memphis, Tenn., police in February 1928. In 1929 the Federal grand jury charged Ralph Capone with failure to pay income taxes—November 1, 1929. There were four Counts in the indictment. Another Federal indictment was returned on January 31, 1930, growing out of his efforts to swindle, cheat, and defraud the United States Government. During the court hearings the Government produced evidence showing that Ralph Capone maintained five separate accounts at the Pinkert State Bank, Cicero, Ill., under the names of Ralph Capone, James Costello, Jr., James Carson, James Carter, and James Carroll, and that he had deposited in these accounts approximately a half million dollars.
The defense attorney represented Ralph Capone as a race-horse man and bookmaker. On May 8, 1930, the Federal prohibition agents raided the Cotton Club, 5340 West Twenty-second Street and the Monmarte Cafe, 4835 West Twenty-second Street, both Cicero, Ill., and alleged that these places were owned by Ralph Capone. Ralph Capone surrendered on May 9, 1930, through the advice of his attorney, Joseph Lustfield. In May 1931 Ralph Capone was allegedly operating the Casanova Club, 1025 North State Street, Chicago, Ill. With reference to the Federal income-tax violation Ralph Capone received a sentence of 3 years in a Federal penitentiary and a $10,000 fine in one case, a similar sentence in a second case and a year in the Cook County House of Correction and a $10,000 fine in the third indictment. Ralph Capone's conviction was upheld when the case was appealed. He returned to Chicago after having served his Federal sentence on February 27, 1934. Although he was not officially implicated in the movie extortion case the Chicago press reported on June 29, 1942, that the president of the Chicago Motion Picture Operators Union was to testify in New York City on the following day regarding statements made by him concerning payments made by the union to the Capone syndicate. It was said that the syndicate maintained an iron-hand control over the Chicago union and that the president of the union had been handing envelopes containing money for a long period of time to Nick Circella alias Nick Dean, and later to Ralph Capone.
On February 20, 1943, it was reported that Abraham Teitlebaum, Ralph Capone's attorney, had advised the United States marshal that Ralph Capone might surrender in order that a subpena could be served on him with reference to the New York extortion trial. It appears that he did proceed to New York City and was grilled by the grand jury in connection with that case. About 1930 it was rumored that Ralph Capone then owned an interest in the Grand Central Surety Co., a bail bond company which signed bonds for numerous well known hoodlums in Chicago, such as Tony Accardo and other members of the Capone syndicate. In recent years Ralph Capone has been very influential in the vicinity of Lyons, Ill. He has exerted a considerable amount of political influence there.
John Capone, another brother of Al Capone, at one time resided at 5400 South Park Boulevard. It is stated that John Capone married an ex-dancer from Atlanta. John Capone is a friend of Pete Tremont, big-shot policy racketeer on Chicago's South Side, and is also a friend of Joe Fusco of Gold Seal Liquors, Inc. Fusco was very closely affiliated with Al Capone many years ago. Some time ago it was claimed that John Capone was a salesman for the Citizens Beer, Joliet, Ill., a brewery which makes beer that is sold by the Canadian Ace Brewing Co., formerly the Manhattan Brewing Co. In recent months John Capone has been associated with Herman Kiefus, who has been very active in gambling activities on the South Side. On July 18, 1932, John Capone, then 29 years of age, was arrested with his bodyguard who at that time was Rocco Fischetti. The arrest occurred at Wabash Avenue and Congress Street. At the time of the arrest $4,300 in cash was found on the person of John Capone, who claimed he had been spending most of his time in Florida and denied any knowledge about the Capone syndicate.
Albert Capone, another brother, has had his name legally changed in Miami to Albert John Rayola. He has resided at 1927 North Normandy in Chicago. There is no indication he has been active in rackets in Chicago and in fact indications are to the contrary. However, he is a friend of Willie Heeney, one of the old time Capone syndicate operators in Cicero. Matt Capone formerly operated a tavern called the Hall of Fame, 4839 Ogden Avenue, Cicero, Ill. John Larisen, a gambler and a doper of race track horses was shot and killed in the Hall of Fame tavern a few years ago. Matt Capone became a fugitive for a time and later the case was dismissed against him with reference to this murder.
Other members of the Capone family include Mafalda, a sister, who is married to John Maritote, who is a brother of Frank Maritote, commonly known as Frank Diamond, who was also involved in the million dollar extortion plot on the movie industry. Frank Diamond was sentenced to the penitentiary in 1943.
Joseph Peskin, alias Sugar Joe Peskin, 7625 Essex Avenue, Chicago, Ill., has been associated with members of the Capone syndicate and is one of the biggest juke box operators in Chicago. His company is known as the Universal Automatic Music Corp., 1506 East Sixty-seventh Street, Chicago, Ill. During the prohibition era Peskin operated the J. P. Food Distributors, Inc., 4446 South State Street, which was ostensibly a wholesale grocery but actually was used to buy corn sugar and other products needed in the manufacture of alcohol. When Peskin and others were indicted for conspiracy to violate the national prohibition law the Government contended that Peskin during that time was furnishing 100 stills with corn sugar for alcohol and it, is alleged that a million dollars worth of corn sugar had been sold to alcohol manufacturers by Peskin. In connection with these activities Peskin was associated with individuals who were known to be close to the Capone syndicate.
Sometime after 1933 Peskin entered the juke-box business. In September 1941 Peskin was arrested on charges of disorderly conduct growing out of a slugging of Lionel M. Nathan, who had been employed by Peskin. Sometime prior to September 21, 1941, Lionel Nathan and Albert Chapman, also an employee of Peskin, had left Peskin's employ and formed a partnership. They bought 150 juke boxes which they distributed and took about 70 spots away from Peskin. Nathan was then slugged in front of his home at 6747 Clyde Avenue, Chicago. Nathan blamed Peskin for the slugging but later repudiated same, and the case was dismissed. Peskin admitted to the police, however, that he had made a threat to Nathan that he would "cut his throat" but claimed he meant it only in a business way. Peskin at the hearing denied the assault and stated :
This thing is bum publicity for me and no good for the industry. These men did work for me and did take some spots away from me. This is not allowed by the union, and with the union's help I have gotten back all 50 of the 50 spots they took.
With reference to juke boxes generally in Chicago, the Loop area has been controlled by the Century Music Co., which was originally under the domination of Denis Cooney; Capone's syndicate vice manager of the first ward. Later Fred Morelli once Cooney's bookkeeper, then became head of Century Music Co. In 1941 the press reported that on the North Side and in the northwest suburbs the juke-box industry was under the control of Eddie Vogel, an important Capone syndicate member. In order to prevent juke-box operators from stealing each other's customers they formed an association known as the Illinois Phonograph Owners Association, and officers of this association several years ago were Danny Pallagi, associated with Fred Morelli of the Century Music Co., Joseph Mahoney, associate of Eddie Vogel and Joseph Peskin. As late as 1946 Joe Peskin was reported to be the juke-box-syndicate boss of Chicago. When an attempt was made to start in business in competition with the syndicate it would fail, because the new operators could not get a union label on their machines from the electrical workers' union. In 1947 it was estimated that Joe Peskin of Universal Automatic Music Corp. had about 900 juke boxes placed on location. These boxes were in Chicago—except in the first ward, where the Century has the monopoly—Cicero, Argo, Calumet City, in Illinois, Hammond, Indiana Harbor, and Whiting. In 1947 on financial records Peskin listed the name of his company as the Chicago Automatic Music Co. In 1948 Peskin was a distributor of juke boxes under the name of the Automatic Music Instruments Co. in States of California, Nevada, and Washington. It was claimed that this territory was secured through the assistance of Frank Garnet, a son-in-law of Jack Guzik, the one-time business manager of the Capone syndicates operations. Frank Garnet has also been operating juke boxes as a distributor in Los Angeles. Peskin's principal office for juke-box distribution in southern California is located at 2663-67 West Pike Boulevard, Los Angeles, where he did business under the name of J. Peskin Distributing Co.
Another important syndicate man is Rocco De Stefano, alias Rocco Nicholas De Stefano. He allegedly owned a home at 5352 LaGorce Drive. I am not sure whether that is in Miami or Miami Beach, Fla. Until November 24, 1947, at which time he apparently sold the home and transferred title to Joseph P. Bergl.
De Stefano has come into prominence recently as an affiliate of such well-known members of the syndicate as Joe Fusco, vice president of Gold Seal Liquors, Jack Guzik, and Charles and Rocco Fischetti. De Stefano controls a chain of retail liquor stores in which Fusco is supposed to have an interest or did have an interest.
Rocco De Stefano and others were indicted February 24, 1936, in Cook County on robbery charges wherein the loot was totaled at $75,000. On May 29, 1936, the charges against De Stefano were nolle prossed on the grounds that there was not sufficient evidence of identity as to the robbery but that he probably did assist in disposing of the stolen goods. This evidence was not considered sufficient to sustain a conviction. In July 1938 Rocco De Stefano, his father, Michael, and others were arrested by the State's attorney's police for failure to pay over $14,000 in sales taxes for 15 months. It was further charged that the operation of the United Liquor Stores, Inc., the company lead failed to pay the State sales tax since 1934 and owed a delinquency of $50,000. On August 21, 1941, the State's attorney of Chicago charged that Rocco De Stefano together with Harry V. Russell, prominent handbook operator, Peter Tremont, policy operator, Patrick Manno, policy operator, Max Caldwell, Milton Schwartz, and Maurice Margolis, had helped spend $910,000 looted from the treasury of local 1248, Retail Clerks Protective Association, union funds. No indictments were returned, however, and no further action was taken. Rocco DeStefano has had his name linked with that of Guzik, Charles and Rocco Fischetti, and other hoodlums as being friends of these persons.
Peter G. Tremont owns property in Miami Beach with Ralph Buglio and was associated with Max Caldwell. He is one of the big-shot policy racketeers on Chicago's South Side. In 1942 he was indicted along with other important members of the policy racketeers, namely, Julius Benvenuti, Edward Jones, George Jones, McKissick Jones, Pat Manno, Julian Black, and numerous others by the Cook County Grand Jury. This indictment charged conspiracy to operate a policy game.
On June 17, 1942, there was a finding of "not guilty" as to Tremont and other individuals indicted. Peter Tremont has operated in Chicago the Silver Wheel, the Ditto Wheel, and the Rome Wheel. He is a. big automobile dealer on Chicago's East, Side, too. I have the address in some of my other notes here.
Pat Manno, alias Patrick J. Manning, has been in the policy racket in Chicago for many years. He was indicted by the Cook County Grand Jury on January 30, 1942, as I mentioned a few moments ago, with others for conspiracy to operate policy rackets. He was found not guilty on June 17, 1942. The Texas Times Herald, Dallas, Tex., on December 19, 1946, linked Pat Manno with others in an effort by Chicago gangsters to take over $14,000,000 annual gambling and racket concession in Dallas County. Dallas authorities never arrested Manno, although others were arrested. It was charged by the State's attorney's office in Chicago on August 21, 1941, that Pat Manno together with the others that I mentioned a few moments ago had attempted to loot or actually spent a large amount of that $910,000 from the Retail Clerks Protective Association. On September 18, 1925, Pat Manno was arrested on a charge of disorderly conduct and placed on probation for 1 year. It is understood that. Pat Manno has been in association with a number of nationally known gangsters at hotels in Miami Beach, Fla., during the past season, and that Manno also owns a residence at 5812 Pinetree Drive, Miami Beach, Fla., which is in his wife's name, Dorothy Manning. Pat Manno also has listed as his permanent address 1439 North Franklin Street, River Forest, Ill.
Lawrence Imburgio, alias Hindu, is the brother of Joseph Imburgio Bulger, former mayor of Melrose Park, Ill. You will recall that Bulger's name was used by Tony Accardo in gaining entrance to the Federal penitentiary to visit Capone mobsters whose parole created a national sensation. As a result, Accardo and attorney, Eugene Bernstein, were indicted by the Federal grand jury. Lawrence Imburgio, while himself not active recently, was reputed to be a muscle man in the Capone mob, was very active in helping the gang muscle into union rackets and later represented the Capone syndicate in the operation of handbooks. He was in partnership in one gambling joint with Tony Accardo. On June 26, 1931, Lawrence Imburgio was arrested in a roadhouse near Wheaton, Ill. in company of Claude Maddox, Tony Capezio, Rocco De Grazio, and Doc Stacey. At that time they were charged with violation of the National Prohibition Act.
Last reports were to the effect that Imburgio was suffering from Burger's disease, which has incapacitated him.
Lester A. Kruse, alias Leslie Kruse, alias "Killer" Kane, has been actively associated with members of the Capone syndicate and has also been prominently identified with racing news service activities. In March 1943 Lester Kane, who gave his address at that time as 2437 Greenleaf, was arrested with Ralph Pierce, 6514 South Morgan Street, for questioning in connection with the murder of Estelle Carey. Estelle Carey was once the dice girl employed by Nick Circella, alias Nick Dean.
The CHAIRMAN. What did you say about Lester Kruse just a minute ago?
Mr. PETERSON. Lester A. Kruse, alias Leslie Kruse, alias "Killer" Kane, has been actively associated with members of the Capone syndicate and has also been prominently identified with the racing news service activities.
The CHAIRMAN. Is that the same person mentioned by Mr. Brown that he bought his stock from?
Mr. PETERSON. I was under the impression that that was who it was. I would hate to say that definitely, but it could very well be. This Lester A. Kruse, the fellow I am talking about, on April 26, 1940, a Federal grand jury returned three indictments before Federal Judge James A. Wilkerson, naming Western Union and 18 gamblers and horse-race-news distributors as operators of schemes to take over the lucrative racing information business abandoned by Moe Annenberg. Named in the first indictment were Arthur V. McBride, of Cleveland, head of Yellow and Zone Taxi Cab Co.'s of that city; James M. Ragen, Sr., Lionel C. Lance, formerly of Chicago and now operating in Cleveland, a nephew of Mont Tennes; Thomas F. Kelley, Cleveland, a brother-in-law of McBride and former Baltimore manager of Nationwide; Thomas J. Ryan; alias Frank Walsh, New York City, formerly in charge of Consolidated News Service, then operating in Hoboken and New York; Morris Wexler, alias "Mushy" Wexler, of Cleveland, associate of McBride; Russell Brophy, Los Angeles, son-in-law of Ragen; Alfred Goodman, Chicago, former Nation-wide representative in Houston, Tex.; William G. O'Brien, alias William Keough, Chicago, former Nation-wide representative in the Southeast with headquarters in Miami ; William Molasky, St. Louis, indicted with Annenberg on tax charges, formerly associated with Pioneer News Service in St: Louis; Morris Kopit, St. Louis, gambler and associate of Molasky.
These persons were charged with conspiring to violate the Federal lottery laws by distributing price lists across State lines. The Government interpreted pari-mutuel betting odds and racing results as lottery price lists and alleged these defendants conspired to decentralize Nationwide News Service .and take over its business through the formation of Continental Press Service of which Arthur McBride was then director. Western Union provided the technical equipment.
The second indictment alleged that four men, Frank J. "Chew Tobacco" Ryan, Hymie "Loud Mouth" Levin—I think that should have been Jack—Harry "Greasy Thumb" Guzik, the owners of the 400 Club at 29 West Randolph, and Maurice L. Goldstein operated an unlicensed radio-broadcasting station in violation of the Federal Communications Act in 1934. Specifically this broadcasting station was said to be a highly technical wire-tapping service, sending out radio signals.
The third indictment named Edward M. Dobkin, Cornelius J. Sullivan, James Rossi, alias James Ross, all Chicago gamblers, and charged them with receiving Continental Press News and distributing it from the Victoria Hotel to numerous bookies.
The Federal grand jury returned an indictment charging the following violated the Federal Communications Act : Jack Guzik, 7240 Louella ; Leslie A. Kruse, alias Kane, 5206 Oakton Street, Niles Center; Maurice L. Goldstein, alias M. L. Goldie.
The offense charged in the indictment was described as follows : Guzik and Kruse financed a scheme whereby miniature broadcasts were used to carry racing information to the 81 Club and so on.
I am inclined to think that is the same fellow.
The CHAIRMAN. Mr. Brown?
Mr. SHENKER. Mr. Brown isn't here. Mr. Brown left before the name was mentioned, or I would have had him stay. It is my impression that the man he bought it from is Arnold Kruse, but I wouldn't say for sure.
Mr. PETERSON. This man's name is Lester A. Kruse. I don't know whether the "A" stands for Arnold or not. I can check it through our files.
The CHAIRMAN. Will you check it?
Mr. PETERSON. I will be glad to do that when I get back.
The CHAIRMAN. Would you say Mr. Annenberg and Mr. Molasky were jointly indicted on income-tax evasion?
Mr. PETERSON. No. On the income-tax evasion I am inclined to think they were on that. I would have to check that, though. This doesn't have to do with income tax, however. This has to do with allegedly setting up this racing news service to take over the old Annenberg regime. This is back in 1940.
The CHAIRMAN. I think you either told me or you stated somewhere that Mr. Annenberg and Molasky were indicted for income-tax evasion.
Mr. PETERSON. I think that may be correct, but I don't know that I have that. I have that in another paper here, I am sure, but I do not have it with me.
The CHAIRMAN. All right. Then that is the same Mr. Annenberg that gave Mr. Molasky 22 1/2 shares of Pioneer News Service for $1, I believe. You may proceed, Mr. Peterson.
Mr. PETERSON. In 1944 information was received that Leslie Kruse lived at 4300 Marine Drive. He was also alleged to be the owner of the Turf Club, Touhy and Western Avenues, a gasoline station across the street from the Turf Club, and a two-flat building in Skokie, Ill. In 1948 investigators observed Gus Liebe and "Killer" Kane on duty as floormen at 4819 West Roosevelt Road where three dice games were being operated. Gus Liebe has been a manager for numerous gambling joints. Lester Kruse is the officer of the Nu-Way Beer Coil Service, 635 North Kennedy Avenue.
Charles Gioe, a well-known member of the Capone syndicate, who was also indicted in the movie extortion trial and convicted, lived at the Seneca Hotel, Chicago, and had an office in a building at 145 North Clark Street before he went to the penitentiary. He was released on parole in 1947 and it is still pending. He is still on the outside, but the litigation is still pending as to whether or not he will have to return in accordance with the decision of the court in New Orleans.
Ralph Buglio, who owns property in Miami Beach, together with Peter G. Tremont and others, is also a well-known syndicate gangster. On February 11, 1933, Frank DeMere, 26 years of age, residing at 7118 South Seeley Avenue, Chicago, was shot outside the Plantation Cafe, a Black and Tan restaurant at Fifty-first and Michigan Avenue, Chicago. Ralph Buglio, who was referred as a former Capone gunman, was sought for the shooting. The police learned that Ralph Buglio and DeMere had been in the Plantation Cafe just prior to the shooting. DeMere approached Buglio and asked him to go outside for a conference and a few minutes later the shooting occurred. In January 1937 DeMere had shot and killed William Stanley, a Negro, after Stanley had slain Frank Buglio, a brother of Ralph.
In 1922 indictment No. 27678 was returned by the Cook County grand jury charging Ralph Buglio, Abe Rosenthal, and Mary Duff with burglary. On September 16, 1922, probation was granted to the defendants. Ralph Buglio's name was also mentioned in connection with the gang killing of Maurice Enright. It appears in this case that the killers borrowed the automobile, in which they were transported to the place of the killing, from Buglio. This killing was in connection with the street-cleaners union.
Joe Fusco, designated several years ago as a public enemy, during the prohibition era was a principal lieutenant in the Capone syndicate, handling the manufacture and distribution of illicit beer. He is presently suspected of being the respectable front in the liquor industry for the syndicate. He is vice president and general manager of the Gold Seal Liquors, Inc. He is also a stockholder and director of the Citizens Brewing Co., of Joliet, Ill. in affiliation with other members of the Capone mob. It has been stated that the syndicate owns or controls at least 17 percent of the retail liquor stores in Chicago. That is merely an estimate, of course. In addition, Fusco admits ownership of three other wholesale distributing houses for liquor. On June 12, 1931, Fusco was indicted with Al Capone and other members of the Capone mob in Federal court, totaling 69 defendants, charged with liquor conspiracy. The indictment was dismissed after Al Capone was convicted of income-tax evasion and sentenced to the Federal penitentiary. On June 7, 1934, when he was arrested, he was in the company of Matt Capone, Ralph Capone, brothers of Al, and Denis Cooney, who was a powerful figure in the Capone syndicate.
Harry Russell, proprietor of the Silver Bar, 400 South State Street, Chicago, is a big-time gambler with affiliation with some of the most important, members of the Capone syndicate. Several months ago it was alleged that Harry Russell had "muscled" into the S. & G. Syndicate, Miami Beach, Fla. Harry Russell, together with his brother Dave Russell, operated a handbook at 186 North Clark Street, Chicago. At one time Tony Accardo, the top-ranking member of the syndicate, was in partnership with him.
Another man in the syndicate, Ralph Cavaliera, alias Armie, 2815 Dickens Avenue, Chicago, was a close associate of Dago Lawrence Mangano at the time of Mangano's death in 1944. Mangano was an important figure in the Capone syndicate. At the time of Mangano's death he was riding in a car owned by Cavaliera. Information has been received to the effect that Cavaliera has operated as a front man for the Capone syndicate and operated Barbout games in the Halsted-Blue Island area. He lost an arm in an automobile accident several years ago, which gives rise to his nickname "Armie."
The Cicero contingent of the Capone syndicate is one of the most important. Cicero has long been the headquarters for the Capone gang. Among the most important syndicate members operating out of Cicero at the present time are Joseph Aiuppa, Claude Maddox, Joseph Corngold, and Willie Heeney.
Joseph Aiuppa, alias Joe O'Brien, is allegedly one of the owners of the Taylor Manufacturing Co. in Cicero, Ill. This company---
The CHAIRMAN. Mr. Peterson, where is Cicero with reference to Chicago?
Mr. PETERSON. Cicero is southwest of Chicago, approximately 8 miles.
The CHAIRMAN. It is a separate municipality?
Mr. PETERSON. A separate municipality. It begins at Cicero Boulevard or Avenue, which is about 48 blocks west. Then it is further south. I believe it goes farther north than Roosevelt Road.
The CHAIRMAN. How large a city is it ?
Mr. PETERSON. About 70,000 people. It is a pretty good, substantial city.
The CHAIRMAN. Some of these fellows have been city office holders in Cicero?
Mr. PETERSON. Oh, yes. Going back again a long time in 1924, that is when I think I mentioned this morning they actually took over the town out there in an election, manned it with machine guns, and that sort of thing. That is when Frank Capone was killed. Just recently, however, in 1948, John C. Stofel became the village president out in Cicero and was doing a very excellent job. He is a prominent businessman. He appointed, as chief of police, Joseph Horejs. Joseph Horejs was put in by Stofel for the purpose of enforcing the law. He did an excellent job for a few months, and then there was so much pressure brought that Stofel was forced to resign. They forced the chief of police out, as a matter of fact. They changed the ordinance to read differently than it had before, which took his control over the chief of police. So Stofel resigned rather than keep the responsibility, powerless to act. Now, of course, nobody can prove that that was the Capone syndicate, but there was certainly a lot of influence there on the part of people who didn't want the town closed up. That is very obvious.
The CHAIRMAN. How long before you will come to another chapter ?
Mr. PETERSON. I can quit any time.
The CHAIRMAN. It is very interesting and most useful. I see you have about three more pages on Chicago.
Mr. PETERSON. I said that Joseph Aiuppa was allegedly one of the owners of the Taylor Manufacturing Co. in Cicero. This company manufactures or supplies gaming-house equipment to gambling houses throughout the Nation. It ships a considerable amount of equipment to Nevada and other places. Claude Maddox, a public enemy and the member of the Capone syndicate, is also allegedly associated with Aiuppa in the Taylor Co. In other words, they get you coming and going. 'They manufacture the equipment and then operate it. On July 5, 1945, Joe Aiuppa was fined $50 on a charge of accepting horse- race bets, by a justice of the peace in the Willow Springs court. Aiuppa and two others were arrested for operating a handbook in the Post Time Tavern, 4824 Cermak Road, Cicero. Aiuppa was also arrested in connection with the slaying of James D. Larrisen, on April 7, 1944, in the tavern of Matt Capone. Recently Aiuppa has been allegedly operating the Turf Club and Paddock Lounge, Cicero, gambling joint. He is considered to be one of the right-hand men of Tony Accardo, who is now rated as one of the real big shots in the syndicate.
Claude Maddox has been a prominent member of the syndicate for many years. It will be recalled that both Maddox and Tony Accardo were both sought as suspects in connection with the St. Valentine's Day massacre in February 1929. Maddox originated from St. Louis, Mo., where he was convicted for burglary on August 5, 1919. The following year he was convicted for robbery in St. Louis, Mo. He has been considered one of the most important syndicate members in Cicero for many years.
Willie Heeney has likewise been prominently identified as a member of the Capone syndicate for a long time. He has been the part owner of the El Patio gambling place at 5914 West Cermak Road, together with Joe Corngold. "Little New York" Campagna admitted having an interest in and receiving huge sums of money as his share from the proceeds of this establishment. I believe Willie Heeney admitted that "Little New York" Campagna got 60 percent and Corngold got 15 percent from the Cicero "joints." Heeney was arrested in 1926 as a suspect in the murder of an assistant State's attorney in Chicago. Willie Heeney was known to be a contact man for the Capone syndicate with St. Louis hoodlums. In fact, Heeney was prominently mentioned in the congressional investigation of the parole of Paul Ricca and other members of the Capone mob.
In fact, it was brought out that Heeney was one of the men who handled the contact with State Senator Brady and. Attorney Paul Dillon of St. Louis on behalf of efforts to obtain paroles for Ricca, Campagna, Gioe, and D'Andrea of the Capone gang.
Another member, John Patrick Borcia—that I believe I mentioned briefly before—alias John Borcy, has been very closely associated with many prominent members of the Capone syndicate. He is a close friend of Tony Accardo, and was also closely associated with Nick Circella, alias Nick Dean, one of the Capone gang members convicted in the extortion case. Borcia has a criminal record and was paroled May 14, 1941, from the Auburn State Penitentiary in New York. In recent years he has operated the Primrose Path, 1159 North Clark Street, Chicago, and in recent months has operated a place called the Primrose Bar in Los Angeles. The premises on which the Primrose Bar in Los Angeles is located were previously owned by Jack Dragna, notorious west coast gangster who operated a vice resort upstairs. It is known that a burglary gang has hung around the Primrose Bar in Los Angeles. Information has been developed indicating that gunmen who have been involved in some of the shootings on the west coast have hung around Borcia's establishment in Los Angeles.
Anthony De Lordo, another Chicago hoodlum, is reported to have been in Florida and to have been in contact there with Sam H. Taran. In fact, information has been received that after the $70,000 fire at the Tavern Distributing, Inc., records and appliance division in Miami, on June 15, 1947, Anthony De Lordo actually tried to contact Sam Taran by telephone. Taran was finally located in Brainerd, Minn. De Lordo was named by James Egan, the payoff man in the gang killing of Martin (Sonny Boy) Quirk, which killing occurred on September 18, 1943, as having been implicated with John Joseph Williams and others in the killing. That case went to trial and all they had was Egan's confession, and there was an acquittal in the case.
Another individual who should receive the attention of the committee is Joseph Epstein, a big betting commissioner in Chicago who has been very close to Virginia Hill, the girl friend of Benjamin (Bugsey) Siegel of the New York mob for many years. Epstein was formerly the head of a group usually referred to as Stern & Horwick, which maintained gambling offices at 10 North Clark Street and 720 North Wabash Avenue. The other members of this group included Edward Stern and S. J. Horwick. In December 1940, when the attorney general—that is, the attorney general of the State of Illinois secured an injunction against bookmakers in the State of Illinois, it appeared that Joe Epstein was then connected with Edward Stern, Jack Terman, Julius Horwick, and James Mondi. During the heyday of the Capone regime James Mondi was one of the big shots in Al Capone's gambling empire in Chicago, although in recent years he has not been very important. Joseph Epstein has continued to furnish Virginia Hill with large sums of money over a period of years. Information was received in May 1949 to the effect that Epstein had been sending Virginia Hill three or four thousand-dollar bills every week or two through the manager of a hotel in Mexico City. It was also understood that Epstein visited Mexico City in the early part of 1949, where he met Virginia. Hill at the Acapulca. It will be noted that Epstein is a big betting commissioner; and, in view of the fact that Virginia Hill has been so closely identified with Benjamin (Bugsey) Siegel of the New York mob and Allen Smiley, Epstein assumes some importance with reference to the Nation-wide gambling set-up.
Other big betting commissioners in Chicago include Edward M. Dobkin, who has maintained offices at 325 West Madison Street, Chicago, as well as at other addresses. Dobkin has been a betting commissioner for many years. In fact, as far back as 1931 he testified in connection with a case that he was a commission man and that when business was good he handled from $25,000 to $50,000 a day in bets. On April 26, 1940, the Federal grand jury in Chicago returned three indictments in which 18 gamblers and horse-race-news distributors were charged with operating a scheme to take over the lucrative racing-information business abandoned by Moe Annenberg. I think I went into that case just a few minutes ago.
That scratches the surface on Chicago.
The CHAIRMAN. Thank you very much, Mr. Peterson. The committee will meet in the morning at 10 o'clock in room 457 of the Senate Office Building, when Mr. Peterson will resume his testimony. We stand in recess until 10 o'clock in the morning. (Whereupon, at 6 :05 p. m., the committee recessed until 10 a. m. Friday, July 7, 1950.)
Ahead to Peterson Testimony Part #2
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