Top Hoodlum

by Anthony M. DeStefano

  La Guardia had clearly hounded Costello over the years. But Costello not only pushed back against City Hall but adapted as needed. He shifted the slot machines to Louisiana where that business thrived for a few years and he diversified with the Beverly, the nightclub that became a fixture in Jefferson County. He had real estate interests as well. Then again, he sat as the caretaker boss of the Luciano mob, getting his cut of the proceeds of the action of other gamblers and their rackets.

  As 1945 approached, Frank Costello was still standing. He had avoided a number of attempts at federal and state prosecutions over the years. Dewey had gone on to the governorship and had his eye on the White House. Meanwhile, La Guardia was approaching his political twilight. He had been reelected mayor twice and carried the city through World War Two. But as the election of 1945 gathered steam, La Guardia lost his zest for the game of politics. He was also showing signs of illness: severe bouts of lower back pain, which were a symptom of the pancreatic cancer growing inside him. La Guardia had enjoyed at least some support from President Franklin D. Roosevelt over the years but with the president’s death in April 1945 and Harry Truman’s taking on the job, La Guardia’s closeness to the Administration diminished. Up to a point, he believed he could win reelection but decided not to run again.

  The election campaign of 1945 was a convoluted one in which various candidates tried to earn a spot on the ballot. One thing was clear throughout the political maneuvers and that was the fact that Frank Costello still seemed to hold tremendous power inside Tammany Hall. Although wounded over the years by La Guardia and the prosecution of Jimmy Hines, the “Tiger” as Tammany was called still had some bite. Whoever held sway of Tammany still had clout in the city and there was no doubt that Costello was such a person.

  As soon as it became clear that La Guardia was not standing for reelection, an intricate political game got underway. One person who was in the race was William O’Dwyer, not to be confused with old bootlegger William V. Dwyer who worked with Costello. O’Dwyer had run previously against La Guardia in 1941 so he had some experience in the game, and from his background was the strongest candidate. An immigrant from Ireland, O’Dwyer had once been a candidate for the priesthood in Spain but washed out, sailing to the U.S. in 1910, and upon landing in New York took a job as a $9 a week grocery clerk. Then he worked as a mariner, hod carrier, and a bartender at the Vanderbilt Hotel before finally joining the NYPD in 1917. He went to law school and became an attorney in 1923, becoming a city magistrate and then in 1938 was elected Brooklyn District Attorney. During World War Two he was commissioned a major in the Army and assigned to the Inspector General’s office to investigate kickbacks and corruption on Army contracts. He was promoted to Brigadier General and then by President Roosevelt to the War Refugee Board.

  O’Dwyer was familiar with the workings of the mob from his investigation of Murder Inc., the criminal combination that worked as a team of executioners for the underworld in the city. As prosecutor he secured numerous convictions of the killers and their associates, namely Louis Buchalter, who in 1944 was the last major New York gangster to be executed. But as good a record as O’Dwyer had against Murder Inc., his record seemed tainted when his chief witness, Abe Reles, fell to his death from the Half Moon Hotel in Coney Island, where he was being safeguarded as a witness. Police determined that Reles died when he tried to get out of the room by climbing down a rope of bedsheets, although conspiracy theorists maintained either the cops or the mob killed him.

  O’Dwyer knew Costello and visited him at his home where, he would later recall, there were plenty of other Democratic politicians present, including Tammany head Michael Kennedy and the organization’s secretary Bert Stand. O’Dwyer never hid the fact that he was friendly with Costello although years later it would come back to haunt him. As George Wolf, Costello’s attorney later said: “Frank’s candidate was Bill O’Dwyer.”

  Opposing O’Dwyer was Judge Joseph J. Goldstein, a Democrat who was actually running on the Republican-Liberal-Fusion ticket, a move that further muddied the political waters. Goldstein was starting from a weaker position in the race and in the month before the election lashed out, perhaps in desperation, to claim that O’Dwyer was really just a puppet of Adonis and Costello. In public statements, Goldstein said that Adonis, who was Brooklyn’s public enemy no. 1, was able to tell the Brooklyn Democratic leadership that they had to take O’Dwyer. When it came to Costello, Goldstein said that the O’Dwyer nomination “was engineered by Frank Costello, Joe Adonis and Irving Sherman,” the latter being a shady businessman with close ties to Costello. Given the fact that O’Dwyer acknowledged a friendship with Costello and had visited him in a meeting with other party officials present, Goldstein’s remarks seemed not far from the mark.

  As earnest as he was in trying to link O’Dwyer with Costello, Goldstein’s campaign was sabotaged by La Guardia when the Mayor pushed his own candidate, Newbold Morris, who was president of the City Council and ran under the “No Deal” party ticket. Morris would dig into Goldstein’s support. At the election, O’Dwyer won easily, pulling 1,225,000 votes, to Goldstein’s 431,601, which was not much better than Morris’s 408,348. O’Dwyer’s margin of victory was nearly 700,000 votes over Goldstein. Costello and his political associates had engineered another significant victory. He was still a king maker in New York.

  But, as Tammany historian Oliver E. Allen later wrote, any expectation that the Hall would have easy sailing with O’Dwyer at the helm was short-lived. O’Dwyer gave Tammany some patronage requests but soon started criticizing the organization. Then, according to Allen, O’Dwyer engineered the ouster of county leader Edward Loughlin and his replacement by Frank Sampson, with orders to rid Tammany of underworld influence. O’Dwyer secretly told Costello of Sampson’s mission, noted Allen, who added that the new county leader was effectively defied by Tammany’s executive committee, led by Carmine DeSapio who happened to be a friend of Costello.

  One meaningful anecdote about Costello’s continuing power came from Wolf who related how his client gave him copies of signed resignations of Tammany leaders, as well as a few judges, with the instructions “If anything happens to me, you know what to do with these.” Although Wolf said he didn’t know what Costello was talking about, the letters of resignation would play out in another political scenario some years later.

  With his political influence stable for the time being, Costello turned his attention to his old friend Luciano. It was May 8, 1945, that the imprisoned Luciano took to heart Judge McCook’s recommendation and filed a petition with Governor Thomas Dewey for clemency. The date was significant because it also was V-E Day, signifying the Allied victory against Germany. Dewey referred the petition to the state parole board, which began a lengthy investigation, interviewing Lansky, Polakoff, Luciano and others and likely included Costello and Lanza about Luciano’s efforts to help the war effort. The mob men cooperated with the parole officials. But when it came time to get statements about Luciano’s work from naval intelligence officials, including Haffenden and Gurfein, their superiors declined to give that permission.

  The parole authorities were stuck. They had gleaned much from Lansky and others about Luciano’s efforts. But the Navy effectively shut down cooperation on the investigation which could parole Luciano and cut short his heavy prison sentence, which had at least twenty and as much as forty more years to run. If he wasn’t given parole, the only way out of prison for Luciano was in a coffin. Finally on December 3, 1945, the parole board recommended that Luciano’s sentence be commuted for the sole purpose of deporting him. Dewey mulled the recommendation for a month and on January 3, 1946, decided to agree with the board and commute Luciano’s sentence for deportation.

  “Upon the entry of the United States into the war, Luciano’s aid was sought by the armed services in inducing others to provide information concerning possible enemy attack,” said Dewey in a message explaining his decision. “It appears that he cooperated in such effort though
the actual value of the information procured is not clear. His record in prison is reported as wholly satisfactory.”

  For good measure, Dewey also commuted the sentences of five others, all of whom were to be deported. Among them was Mock Tick Tong, who was sentenced to death in 1925 for murder in a Chinatown tong battle but subsequently was commuted to life in prison. Dewey ordered him deported to China. The four others who had their sentences commuted were ordered deported to Italy, England, Greece and Spain.

  In his biography, Luciano claimed to the authors that he had originally demanded that he be given parole for his cooperation but that Dewey stood firmly against that. Luciano also claimed that Dewey agreed to go easy on city racketeers and that he, Luciano, secretly contributed $90,000 in untraceable funds that was funneled to Dewey’s campaign. Luciano didn’t specify which campaign but presumably the 1944 Presidential race, which Dewey lost.

  It took just about a month for Luciano to be moved around for deportation. He was taken from Sing Sing prison to Ellis Island on February 2 where he was visited by Costello and Polakoff. Costello brought Luciano his baggage and what were described as personal items. Authorities went to great lengths to note that Luciano’s guarded room on the island was just like any other: a chair, a bed, a toilet. Costello and Polakoff left promptly. But Luciano was not to leave from Ellis Island. He was moved to Bush Terminal in Brooklyn where he was to pick up passage on the victory ship Laura Keene, an old, 7,000 ton freighter.

  Luciano was under guard during the final days he remained in the U.S. But it was reported that on Saturday night February 9, two days before the Laura Keene sailed, that six men, possibly including Albert Anastasia, the major waterfront gangster, had a farewell spaghetti and wine dinner on the ship. In his book about Costello, Wolf described a more ornate feast, with Costello, Joe Adonis, Meyer Lansky, Anastasia, and a few lesser lights arriving with hampers “crammed with wines and liquors, lobster and caviar—and no doubt money.” Wolf claimed a few judges and politicians attended, although The New York Times reported that only a half dozen men came to the party.

  On February 10, 1946, the Laura Keene left Bush Terminal for Italy with a cargo of flour and a solitary passenger—Luciano. Federal immigration officials traveled on the ship as far as Ambrose Light, the beacon that marks the beginning of Ambrose Channel, the main shipping lane into New York harbor. It would take about two weeks for the Laura Keene to get to Genoa, Luciano’s first stop in his old country. Back in New York, Costello was no longer just a caretaker boss. With Luciano out of the country, Costello was the boss of the family and one of the most powerful gangsters in the country.

  CHAPTER SEVENTEEN

  CUBA LIBRE

  LUCIANO MAY HAVE BEEN EXILED TO ITALY but that didn’t mean he didn’t retain power and influence with his Mafia family. It wasn’t long before Luciano got in touch with his men—Costello, Anthony Carfano, Lansky, and others—to plan his next move. Transatlantic telephone calls served as Luciano’s best way to keep in touch, and it seems that the federal government didn’t monitor them all that closely. If he couldn’t return to the United States, Luciano had a very convenient base to operate from some ninety miles from American soil: Cuba.

  Through the influence of Sicilian Mafia boss Don Carlo Vizzini, Luciano was able to get an Italian passport and travel documents. It was in late September or early October when Luciano boarded a plane for the Western Hemisphere. He is said to have traveled an indirect route to Brazil, Venezuela, and Mexico City before finally landing in Camaguey, Cuba.

  “I had the police chief, a couple of senators, even the president himself in my pocket,” Luciano would later brag. “The whole thing was set up for me by Meyer Lansky.”

  Of course, Cuba had long been a playground and business center for the American Mafia. Lansky had been a major player and ran a number of the casinos on the island. As portrayed later in the film The Godfather: Part Two, Cuba was an open country for the mob and the lure of the Mafia money for politicians like Fulgencio Batista was powerful. With money, the Mafia had effective sway over much of the government and allowed Cuba to be a gangster sanctuary. His road to Cuba made with corrupt payments to assorted politicians and officials, Luciano decamped to the fabled Hotel Nacional.

  Luciano had work to do in Cuba and it was Lansky who arranged for him a large meeting in Havana with many major players in the American Mafia. There is some uncertainty about the exact date: government records in the National Archives indicate it was in early 1947 while mob historian Allan May puts it in December 1946. In any case, the participants represented the high echelon of the mob. Frank Costello and Meyer Lansky were the only two gangsters of note on the government list. But May’s list, as well as Sciacca’s compilation, were more extensive and have Anthony Carfano, Thomas Lucchese, Vincent Mangano, and Vito Genovese representing the major powers from New York. From Chicago were the Fischetti brothers, Rocco and Charles, as well as Tony Accardo. Carlos Marcello, Costello’s casino and slot machine partner from New Orleans, also made the trip. The lists were impressive.

  Two non-mobsters in attendance, according to the government list, were Luciano’s attorney Moses Polakoff and the young, popular crooner Frank Sinatra. Polakoff may have been present to discuss with Luciano his legal and immigration situation. Sinatra’s role was that of an entertainer who, according to his biographers Anthony Summers and Robbyn Swan, made the flight to Havana from Miami on a plane with Chicago gangster Rocco Fischetti in February 1947 and was seen exiting the aircraft on newsreel footage, giving more credence to the view that this giant mob confab was in early 1947.

  “Giving Frank the maximum benefit of the doubt, it would seem that he made some very bad decisions at a very sensitive time in his personal life and his career,” Summers and Swan would say about Sinatra’s trip to Havana. “This was his walk on the wild side with the Mob, with the men he had come to admire for all kinds of reasons, both inexcusable and understandable.”

  Sinatra wasn’t there to take part in any mob conclave: he was just the entertainment. There had long been stories about Sinatra and the help the mob gave him, including the story that Costello and Willie Moretti got the singer a gig at the Rustic Cabin in New Jersey and were otherwise instrumental in pushing Sinatra’s career. But Summers and Swan said there was no proof that Moretti and Costello set up the Rustic Cabin deal but noted that FBI and federal narcotics agent files talked about reports that Costello had been a big pusher of Sinatra’s career, assigning the Fischetti brothers to chaperone him in the business. In Havana, Luciano, Costello, and the rest hunkered down to talk about their businesses. Federal narcotics officials were aware that something was up because a local Cuban newspaper had printed the story earlier about Luciano’s arrival. Agents surveilled with the aim of seeing if Luciano was involved in narcotics traffic coming out of Cuba to the U.S. and might be trying to control the mob from the island. However, while the agents faithfully watched the comings and goings of the mob retinue—be it to restaurants, beaches, or brothels—they couldn’t determine with any certainty what the meeting was all about.

  As it turned out, one subject was the unhappiness of everyone over the way Bugsy Siegel had been acting. Siegel had gone to California to take care of rackets there and eventually it was suspected that he was skimming from the mob and its Hollywood union business. But there had been another problem for Siegel, one that had the potential to implicate Costello and cause him harm as well. Siegel had come up with the idea in the late 1930s of building a gambling Mecca in Las Vegas, Nevada, a state where gambling was legal. Many in the mob were cool to the idea, but Siegel convinced Costello to invest. Following Costello’s lead, others went along and threw in money as well.

  Siegel’s idea was to build a plush hotel known as the Flamingo and hire big name entertainers to draw crowds. On paper the idea sounded like a good one. But Siegel, who may have been a good bootlegger, was a disaster for the project. He made unrealistic demands for construction materials, which were
in short supply due to the war. Cost overruns mounted and when the Flamingo was ready for its opening night, December 26, 1946, the project was many millions of dollars—mob dollars as it turned out—over budget. Nevertheless, Siegel had planned a big opening night, with Hollywood stars to be flown in to fill up the casino. The stars were on the plane ready to fly in to Las Vegas when foggy weather grounded them. They were no-shows on Siegel’s big night, and the Flamingo reportedly lost $500,000 in its first two weeks. The debut was a big bust.

  No matter how valuable loyalty and other personal traits may be in the Mafia, it exists to make money and when that goal is threatened the consequences can be deadly. Costello’s attorney George Wolf had tried to keep his client out of trouble but with the financial problems caused by Siegel’s overspending and mismanagement of the Flamingo project, the lawyer learned how much Costello now risked. He had staked his own money on the venture, enticed others to throw in cash and now was the object of recrimination when things were not looking good. Wolf remembered fearing for Costello’s safety.

  “What happens if you can’t raise it?” Wolf remembered asking Costello about the money his old friends wanted back.

  “Part of it’s already happened,” Costello replied cryptically, recalled Wolf.

  With Luciano in Havana, the mob men complained to him personally about the money that was lost. There were stories that some wanted Costello killed as punishment. When he got to Cuba to see his old friend, Costello knew he faced a critical point. Luciano had been his old friend, the man he had entrusted with the command of the crime family. But money is all important in the Mafia, and Luciano told Costello he had to get the money back somehow.