Supermob

by Gus Russo

  McCulloch recently spoke of his team's coverage of the Supermob: "After we covered the strike at Dodger Stadium, Korshak wanted to sue me. One of the movie people called me—I think it was Lew Wasserman—and said, 'What are you doing this to old Sid for?' He said, 'I'm telling you as a friend, Frank. I wouldn't pursue this any further. There could be legal ramifications and more.' I'll never forget that part." (This would not be the first time that Korshak's corporate friends would try to derail bad publicity for Sidney.)

  Then the newsman devised a brilliant tactic to deal with the Fixer, as Korshak was now referred to. "It was suggested that we subpoena one of the bosses in Chicago, and Korshak would lose interest in going to court rather rapidly," McCulloch remembered. "And we did serve one of them; I think it was Giancana. We preempted Korshak and we never heard from him again. That's when he donated money to Dorothy Chandler, the publisher's wife."43

  McCulloch was referring to a typical Korshak damage-control gambit, aimed at defusing any local coverage of his activities. In 1961, Dorothy Buf-fum "Buff" Chandler, of the Chandler family that owned the Times-Mirror newspapers, had become the company's vice president for corporate and community relations. In that position, she waged a tenacious battle to realize a dream: the construction of a world-class music center. Envisioned as a privately fostered, but not-for-profit, partnership with the County of Los Angeles, the center site was donated by the county, which raised an additional $14 million using mortgage revenue bonds. Los Angeles rabbi Ed Feinstein remembered Chandler's quest: "She had a problem in 1962. It was her great dream to see a cultural center constructed downtown, giving Los Angeles a cultural gravity it had never possessed. She wanted something much more important. She wanted to bring the city together."44

  More concerned with filling coffers than with the source of the donations, Buff courted political opponents such as Paul Ziffren and Sid Kor­shak. Publisher Otis Chandler, Buff's son, recently admitted, "My mother would court the devil for contributions. Anybody who'd give her some dough."45 Chandler told the understandably press-shy Korshak that his name would never appear in the Times if he would cough up a contribution. Korshak quickly obliged and sent a $50,000 check to Buff's building fund; he likely considered the donation to be a business investment, and a continuation of a relationship he had fostered for years. Back in 1958, Korshak was observed meeting with the Times managing editor L. D. Hotchkiss. Allegedly they were discussing the political future of Congressman Richard Rogers of California.46 However, Hotchkiss wras infamous for his refusal to run stories that reflected poorly on the city to the extent of killing important stories about organized crime.47 Korshak's friendship with Hotchkiss had guaranteed his continued anonymity during that previous regime.

  The Korshak-Buff Chandler arrangement did not, however, proceed as smoothly as the previous one with Hotchkiss. According to the FBI, although Affiliated was granted the parking concession at the pavilion, Kor­shak's check was returned because of what Chandler's own reporters were turning up about Korshak's bedfellows.

  By 1962, McCulloch had become curious about the aberrant real estate transactions that were a fundamental part of California's recent history. In the spring of 1962, McCulloch pulled aside Jack Tobin and pointed out the window. "One day, almost as a joke, I asked him, 'Who the hell owns the Santa Monica Mountains?' " recalled McCulloch. "He took me literally and went and found the Teamster connection." The more they mulled it over, McCulloch and Tobin began to realize that this prime Los Angeles real estate tract, as yet undeveloped, was an invitation to the kind of corruption that the state seemed to cultivate.48

  Tobin and Blake treaded the same path blazed by Robert Goe, Lester Velie, and Art White (albeit with just one specific locale in mind) straight to the Los Angeles County Recorder's Office. After painstaking research, the duo concluded that the Chicago real estate investments in California were ongoing. As noted in their first article on the subject, Tobin and Blake quickly learned that the Chicago-based Teamsters Pension Fund had loaned over $30 million to out-of-state businessmen like Chicago's Pritz­kers, Detroit's Ben Weingart, and Texas's Clint Murchison. Hoffa admitted to the reporters that the fund had earmarked some $4 million for the Pritzkers and their Hyatt enterprise, and that he had personally approved the $6.7 million Murchison loan to develop Trousdale Estates, an exclusive gated community at the top of Beverly Hills that housed Korshak's close friend Dinah Shore, Hillcrest regular Groucho Marx, and later, Elvis Presley.

  Another Trousdale purchaser was Richard Nixon, who paid $35,000 for his lot at 410 Martin Lane, far below the listed price of $104,250 ($750,000 in 2004 dollars).49 The favor was not surprising, given Nixon's cozy relationship with the Teamsters. In the 1960 election, the Teamsters not only endorsed Nixon, but Hoffa also personally coordinated a $1 million contribution to the Nixon campaign from the Teamsters and various mob bosses including Louisiana's Carlos Marcello.50 As Tom Zander, retired Chicago crime investigator for the Department of Labor, recently said, "Anybody who wanted to pay for it had a connection to Nixon. The locals gave massive amounts of untraced money to Nixon. They got away with murder."51 Interestingly, it now appears that Nixon hid much of his lucre in the same offshore bank haven, Castle Bank, favored by Moe Dalitz, Abe Pritzker, and the architects of the Las Vegas casino skim.52

  The loan to Weingart, who had bought so much confiscated Japanese property from Bazelon's OAP, was for a $1.1 million influx into a laundry company he shared with Midwestern trucking magnate James (Jake) Gott­lieb, who also owned Las Vegas' Dunes Hotel, itself the recipient of a $4 million Teamsters Pension Fund loan.53

  Other red-flag names that began showing up in the transactions included Moe Dalitz and "consultant" Sidney Korshak, who controlled labor at Santa Anita Race Track, another site that was determined to have received a large fund loan. Thus, like so many had done before, McCulloch, Tobin, and Blake began corresponding with Virgil Peterson for background info on the loan-happy Midwestern transplants, especially Korshak, the Pritzkers, Gottlieb, and Stanford Clinton. Simultaneously, L.A. chief of police William Parker asked Peterson for the Korshak file.54

  Coincidentally, while the Times' research was ongoing, publisher Otis Chandler threw a cocktail party attended by none other than Robert Kennedy, who nearly spit out his drink when he was informed of the latest finds by Tobin. "He got red-faced and violent," Frank McCulloch recalled. "His voice rose. He said, 'You'd better lay off that!'" The following day, when Ed Guthman explained to McCulloch that Kennedy had already impaneled a federal grand jury to investigate Hoffa, McCulloch grasped the national implications of the California real estate rat's nest they were exposing. McCulloch's immediate superior, Frank Haven, tried to warn him off the story, saying, "Once you get to the point where you can get a guy to talk, then either you or he or both are going to end up in a lime pit some­where." 55 McCulloch explained that the initial reason for the nervousness was another potential revenue loss like the paper had experienced after the Birch series. Editor Nick Williams also attempted to halt the Teamster series. "Poor Nick Williams was put in the middle," said McCulloch. "He told me, 'Oh, let's drop this stuff, Frank. It's dull; nobody reads it.' I told him he'd have to order me."

  Instead of backing off, McCulloch ordered Tobin and Blake to double their efforts. Of course, any scrutiny of Hoffa's California interests would lead to Sid Korshak, which in turn would inevitably track to Ziffren, Bazelon, Arvey, Hart, and the entire seamy underbelly of the Los Angeles economy. For a year, the series continued, inching inexorably toward the Ziffren-Arvey nexus. "There were twenty-seven stories in the series, and the Chandlers were upset all along," said McCulloch. Suddenly, word came from above—as in Otis Chandler—that the series had to be dropped. "Frank, you're killing me. Don't run any more of those pieces," ordered Chandler's underling Williams. McCulloch finally caved. "Nick was getting pressure from above," remembered McCulloch. "So we ended it."

  "Obviously some pressure was put on the Times and they buckled," said Ed G
uthman. "Tobin left the paper over that issue."56

  McCulloch also left the paper soon thereafter. Gene Blake was effectively stopped from going further when he was dispatched to the Times'1 London bureau, a good fifty-four hundred miles from the L.A. County records files. Tobin went to Sports Illustrated, where he was an award-winning discloser of corruption in sports. Connie Carlson, investigator for the California attorney general, was a friend and colleague of Tobin's, sharing his interest in the Chicago underworld's usurping of the state. Recently, Carlson remembered, "Jack Tobin became very disenchanted with the Times because there was no follow-up on his discoveries. It was disappointing for a number of the reporters at the Times, because under Otis Chandler they had formed a very formidable investigative unit. They were going full bore on everything. And suddenly it all came to a halt."57 Frank McCulloch returned to his former home at Time magazine, where he ran its Saigon office. "I left for a combination of reasons," McCulloch said. "In addition to the problems with the series, Nick wanted me to start a Sunday magazine, and I didn't want to do that—I had left a magazine to come to the paper. Then I got a call from Henry Luce, who said to me, 'Handle that mess in Southeast Asia.' The guy who succeeded me, Frank Haven, hated that corruption stuff. He only wanted to cover City Hall and run wire stories."

  Although potential financial woes were the implied reasons for the crackdown, Otis Chandler may have had additional motivations for muzzling his reporters. "It turned out that the paper's holding company, Chandler Securities, owned property that had Teamster money in it," McCulloch said recently. "And they were pretty sure we were going to reach that, which we did, and we ran a story on it."58 Tobin and Blake had also found that Chandler was a large stockholder in Korshak's Santa Anita Race Track, a long-suspected venue for cleaning mob money. But there was more: the reporters' next scheduled story was to focus on another Los Angeles company, Walt's Auto Parks, which had received Teamster money that also appeared to have been laundered for the mob. This sleazy company, which operated parking lots throughout downtown Los Angeles, counted none other than Otis Chandler as one of its heaviest investors.59

  Although Chandler declined Korshak's check, others continued to feast at his trough; in November 1962, Korshak underwrote dinner costs for group attending a charity event benefiting the Cardinal Stritch School of Medicine at Loyola University, where both Korshak brothers were trustees. Sid's brother Marshall was host for the bash.60 Two years later, on November 24, 1964, Sidney, who had himself received an honorary doctorate from Loyola, again showed his support for the Stritch School, this time underwriting the entire cost ($50,000) for the first annual Sword of Loyola Awards Dinner and Benefit. With comedians Allen & Rossi and the Chicago Symphony performing at the Hilton Hotel venue, the dinner raised over $250,000. The Sword prize paid tribute to people who "exhibit a high degree of courage, dedication, and service." Seated at the head table with Sidney was the prize's first recipient, J. Edgar Hoover.61

  Like Marshall, Sidney gave extensively to numerous Jewish causes. Friend Leo Geffner recently observed, "Sidney was a very strong supporter of Israel—he contributed a lot of money. Sidney never hid his Jewishness, never tried to assimilate."62 The largesse was not only emblematic of the Korshaks' lifelong charitable works, but also of the brothers' great love and respect for each other. "Marshall and Sidney were so close it was unbeliev­able," said one friend of both, who asked that his name not be used. "They were on the phone with each other four or five times a day. And they were so proud of each other. Marshall was proud of Sidney because of his accomplishments and the connections that he had. And Sidney was proud of Marshall because of his public life—he was straight as an arrow. He was the only major Chicago politician who didn't have his hand in the till."63

  Eventually, the opening of the Music Center for the Performing Arts went off without a hitch on December 6, 1964, becoming the home of the Los Angeles Philharmonic and fountainhead for all of Southern California's performing arts.* Lew Wasserman was enlisted by Dorothy to be president of the Center Theatre Group, which supported the Center's drama program; Wasserman, in turn, brought in Paul Ziffren as counsel to the group. In her nine-year campaign, Buff raised $20 million in private donations, earning her the prestigious cover of Time magazine.

  Vegas II

  Korshak is acting as a front man to work out a deal in Las Vegas for Chicago hoodlums to invest in Las Vegas gambling casinos.

  JANUARY 16, 1961, FBI TELETYPE64

  In February of 1962, the FBI noted that Sam Giancana was making rumblings about expanding the gang's share of the Nevada nest egg. Giancana functionary "Lou Brady" (Louis P. Coticchia) was utilizing Sidney Korshak to arrange financing of an $11 million casino-hotel in Reno. On wiretaps, Giancana was heard suggesting, "Korshak would expend his best efforts should he be made a partner in this deal and given five or ten points [inter­est]." 65 The FBI summarized that Johnny Rosselli was heard talking to Gian­cana to the effect: "Negotiations are in progress in Las Vegas for the Chicago organization to obtain a tighter grip on Las Vegas hotels and casinos, and negotiations are being made through Sidney Korshak."66 Simultaneously, Giancana wanted to make a grab for Jake Factor's interest in Las Vegas' Stardust, and whether "Mooney" knew it or not, he could not have chosen a better time to plan a hostile takeover.

  By the summer of 1962, Jake Factor was in full image-remake, if not life-remake, mode. His epiphany was understandable given two recent events that had to have shaken him to his core: the Immigration and Naturalization Service (INS) was unrelenting in its threat to deport him back to England, where he would likely have spent the rest of his life in prison, and the Chicago Outfit had threatened to end his life immediately if he didn't sell the Stardust back to their consortium with Moe Dalitz. After months of negotiations coordinated by Sid Korshak, Factor sold his interest in the Stardust to Moe Dalitz's Desert Inn Group, which was in fact a partnership of the Chicago and Cleveland crime syndicates. When the deal was finalized in August, the $14 million price tag prompted both the U.S. Department of Justice and the Nevada State Gaming Commission to investigate the hotel's true ownership.

  By this time, Bobby Kennedy had authorized the planting of illegal bugs (microphones) in seven of the Strip's hotels, including Moe Dalitz's Desert Inn executive suite. Six months after Factor had unloaded the Stardust, the feds eavesdropped while Korshak and Dalitz discussed the various sales Korshak had brokered in the past, and the Factor sale in particular.

  In 1960, GI Blues costars Elvis Presley and Juliet Prowse visit with the Desert Inn's Moe Dalitz and Wilbur Clark. (Left to right) Dalitz, Presley, Prowse, Wilbur and Toni Clark, Cecil Simmons, and Joe Franks behind Clark (Wilbur Clark Collection, UNLV Special Collections)

  Dalitz in Vegas, undated (Cleveland State University, Special Collections)

  "I scared the shit out of him [Factor] from day one about what was going to happen," Korshak boasted to Dalitz. "I think that was the one reason he finally agreed to give us the option to purchase."

  Korshak emphasized the point by telling how, when Curly Humphreys had recently instructed Korshak to send Factor back to Chicago for a meeting, Factor became unstrung.

  "He said, 'Well, I've got to run now, but I'll talk to you in about a half hour,' and that was the last I saw of him. He caught the afternoon plane," Korshak informed Dalitz. At this point both Dalitz and Korshak burst into laughter, with Korshak adding, "So this is consistent with what I was saying—he is frightened to death and that is how we were able to make this fucking deal." The Bureau also knew that Korshak had taken Rosselli to meet with Factor at the Beverly Hills Friars Club for a conference, wherein "Factor looked worried."67

  The discussion then turned to Bobby Kennedy's war on the underworld, ironic since Bobby would soon be listening to the tape of this conversation.

  "Bobby has been trying for six months to catch someone either in Las Vegas or Los Angeles who is carrying money," said Korshak. To fight this onslaught, he advised, all concerned should
plead the Fifth Amendment when questioned under oath. As one of Korshak's closest Hollywood friends, Bob Evans, summarized, "Sidney's first commandment was, the greatest insurance policy for continued breathing is continued silence."

  "Moe, I have preached this all over the country," Korshak counseled Dalitz. "Do not answer anything. I have testified before grand juries in New York and Chicago, and at that time I could do it because then I was dealing with certain people. I tell you now, Moe, if I am called before any grand jury, I will take the Fifth Amendment, and I am a lawyer. I will give my name and address, and from that point on I will answer no questions. They can disbar me, but I will take the Fifth. Now 1 have to take the FifthbecauseI am operating in a different atmosphere."68 (Author's italics.)

  The wise counsel was no surprise to one of Korshak's oldest friends in the Chicago legal fraternity. The lawyer, who asked not to be named, had also met Dalitz, who shared a personal story with him. "During the war, it was Sidney, who I had not met at that point, who recommended me for OCS," Dalitz had said. "I'll never forget it." The source added, "As a result, Dalitz didn't go to the bathroom without checking with Sidney"69

  The conversation was also revealing on another front, as Korshak related how close he had become to Sam Giancana, and how the two had dined together recently. Korshak then told Dalitz to let him know if there was any message he wanted delivered to the Chicago boss.