Top Hoodlum

by Anthony M. DeStefano

  Department stores saw shopping decrease when the committee was in session. That wasn’t necessarily a bad thing for some. One grateful husband wrote Kefauver that when he and his wife visited Manhattan his spouse decided to stay glued to the television in their hotel room and not go on shopping sprees. At the office of Manhattan District Attorney Frank Hogan, the prosecutor sat in his office and watched with several judges. Libraries tuned in and movie houses in Queens and Brooklyn showed the hearings on large screens, letting the public in for free.

  Costello wasn’t the only witness who drew audiences. Former Mayor William O’Dwyer, who had taken the job as ambassador to Mexico, was on the stand for hours, defending his records as Brooklyn District Attorney prosecuting Murder Inc., and explaining his contacts with Costello during a meeting in the gangster’s apartment back in the 1940s. O’Dwyer said he happened to be at the apartment in his role as a general in the Army investigating possible contract fraud. O’Dwyer came across so poorly in the hearings that he resigned his ambassadorship a short time later. One saucy witness was Virginia Hill, also known as Virginia Hauser, who talked about her days and nights with Bugsy Siegel and denied taking any gifts from Costello, Lansky, or Luciano.

  But of all who testified, it was Costello who represented what Kefauver saw as the face of organized crime. When the committee issued its report in May 1951, among its findings were a confirmation of what had been said in its February report: Costello, Joe Adonis, and Meyer Lansky formed the “eastern axis” of a group of racketeers working throughout the country. Costello clearly had major influence over Tammany Hall through his personal friendships with Democratic Party leaders as well as some Republican leaders.

  The committee also went after O’Dwyer, who was portrayed as being suspiciously tentative in going after the mob. The main criticism was that as Brooklyn District Attorney O’Dwyer didn’t follow through on the Murder Inc. probe by failing to indict some of the leaders of the gang, as well as its chief killer Albert Anastasia. The committee also made a point of noting how O’Dwyer characterized Costello’s political strength by saying, “It doesn’t matter whether it’s a banker, businessman or gangster, his pocketbook is always attractive.”

  Costello had frustrated the committee when he refused to turn over his financial records reflecting his net worth and made statements that seemed filled with perjuries. While there was a question about whether Costello could be deported for his activities, the committee believed that a conviction for perjury, as well as for violating the gambling laws in Louisiana through his Beverly Club, might just be the ticket to boot him out of the country.

  In a sense, Kefauver gave federal prosecutors a roadmap of how they could now go after Costello after so many previous failed efforts. As his attorney George Wolf would later say, the government was now on a mission to “Get Frank Costello” and began putting the wheels in motion to target him on a number of fronts.

  The first bad news for Costello came about three months after the hearing ended in July. A federal grand jury in Manhattan indicted Costello, Joe Adonis, and Frank Erickson for contempt of Congress. Adonis and Erickson were already in jail for gambling charges, so it was only Costello who had to go to the federal courthouse in Foley Square to get formally arrested and put in a jail cell. But Costello was only in custody for a little less than an hour when Wolf appeared with him at the arraignment and posted the $5,000 bail.

  As Kefauver and Halley had threatened during the hearings, Costello was charged for refusing to answer questions over his net worth and then on March 15, walking out of the hearings after complaining of a sore throat. Costello also wouldn’t answer questions about his investments either. The charges against Adonis and Erickson alleged that their refusals to answer questions before the committee on Fifth Amendment grounds were also grounds for contempt of the committee. Erickson wouldn’t even answer questions about whether he knew anything about baseball or basketball gambling pools.

  Costello’s trial on the contempt charges began in early January 1952, and the government called just a few witnesses. One of them was Dr. Douglas Quick, who treated Costello for throat cancer eighteen years earlier and had examined him before his testimony before the Senate committee on March 16. At that time Quick had determined that the acute laryngitis Costello suffered from still would have allowed him to testify to a limited degree.

  In the courtroom and once again impeccably dressed, reporters noted that Costello seemed bored by the testimony, sometimes yawning or else letting his eyes wander around the courtroom. Wolf had recounted how the Senate committee sandbagged his client, reneging on the expectation that the committee would give Costello a chance to exonerate himself. The attorney went after Dr. Quick on cross-examination, getting the cancer specialist to admit that he had testified in the grand jury that he had mentioned the possibility of using a tracheotomy tube in Costello’s neck because his vocal cords were so swollen. Another physician who had examined Costello, Dr. John Kernan, admitted that he wouldn’t have permitted a patient in Costello’s condition to testify at all.

  “From my point of view, both physicians’ testimony had been hurt badly by their admissions on cross-examination,” Wolf later said.

  In another twist, Rudolph Halley, who had been the committee counsel who had questioned Costello with such hostility, also appeared as a witness. But it seemed that all Halley added to the evidence was some testimony about the conditions of the hearing and Costello’s demeanor. Costello hated Halley so much that he wouldn’t even look at him when he testified.

  On January 11, the trial judge Sylvester J. Ryan gave Costello’s cause a blow when he ruled that Costello didn’t invoke his Fifth Amendment right against self-incrimination in good faith when he refused to testify before the committee about his net worth. As Wolf saw it, Ryan had taken away the key part of Costello’s defense, leaving him open for a conviction. As it turned out, Costello came very close to a conviction when the jury on January 15 reported it was deadlocked 11 to 1 in favor of a guilty verdict. The one holdout thus forced a mistrial, as well as a federal investigation into possible jury tampering, which went nowhere.

  A retrial found Wolf sidelined by illness and Costello had a new attorney, Kenneth Spence, take over his defense. As Wolf later related, Spence, a white-shoe Wall Street lawyer, appeared to make some tactical errors in the defense when he really didn’t offer any. Spence tried to reargue the self-incrimination issue and then didn’t fight the government claim that Costello’s sore throat wasn’t bad enough to keep him from testifying. As prosecutor Myles J. Lane told the jury, “Costello was too stubborn to answer . . . He thought he was a law unto himself. He thought he was bigger than the United States Senate.” Spence didn’t even offer a closing statement on Costello’s behalf.

  Given the poor defense offered on his behalf, the jury convicted Costello of all ten counts of contempt in the indictment late on April 4, 1952. Costello showed no emotion at the verdict, and outside the courthouse had no comment for reporters. Judge Ryan had wanted to sentence him right after the verdict but Spence at least did something to justify his legal fee when he got the court to give him a few more days to argue for a mistrial.

  Prosecutors were elated at the verdict. Costello, the nationwide boss of crime, had been convicted and was certain to get a prison sentence. In fact, Costello got a sentence of eighteen months in prison and a $5,000 fine on the ten contempt counts. He didn’t have to surrender right away since he had an appeal pending, which was heard in May. While the appellate panel didn’t seem sympathetic, the judges in July actually reversed seven of the ten counts of contempt, saying that some of the charges were redundant while three actually violated his privilege against self-incrimination. In the decision, written by Judge Learned Hand, the court believed it wasn’t even a close question about whether Costello had the right to take the Fifth Amendment on questions of his net worth and his indebtedness. He certainly did have the right under the Constitution, said the court.

&
nbsp; The Senate committee’s branding Costello a leader of organized crime before he publicly testified and the obvious income-tax implications of the questions could create “a reasonable apprehension in the mind of the defendant that his answers might be incriminating,” the court ruled. The court also threw out four other counts because they were duplicative. But with three of the contempt charges sustained, there was no way Costello would avoid prison.

  When it came time for Costello to surrender to the U.S. Marshals, his attorney George Wolf accompanied him to the federal court in Manhattan. As Wolf remembered, it was a hot August 16, 1952, when Costello, sitting in a dimly lit courtroom, asked that the marshals take him away. One deputy came out with handcuffs, and when Costello saw that he said, “Hell, I don’t need those.” But protocol dictated that Costello be handcuffed just like all the other prisoners before he was placed in a van and taken away for a trip to a local detention center and then on to the Lewisburg Federal Correction Center for the beginning of his odyssey through a number of prisons.

  In Lewisburg, Costello was given registration number 20125-NE. As was standard for all prisoners, Costello was written up in an admission summary, and some of the observations contained in the report were a telling narrative of his life and his personality. After having been reared in what the narrator—whose name is unknown—said was a New York City slum, Costello “has risen from this lowly status to a position of eminence in underworld circles.” As to Costello’s personality, the report said, “He impresses as being an individual of rather low cultural status, but possessing a considerable degree of native shrewdness.” Costello would have vehemently disagreed with the first part of that statement but couldn’t argue with the second part.

  In Lewisburg, Costello was concerned about his own legal problems and didn’t care much for any programs the facility offered inmates. But he wasn’t a malcontent either and got along with other prisoners and guards. As a fifty-nine-year-old inmate who suffered from throat problems, Costello was only to be assigned moderate physical duties.

  Costello was only at Lewisburg for about a month when he was transferred to the U.S. Penitentiary in Atlanta on October 10. He had an initial interview to determine what kind of work he could do but didn’t have much to say. The officials decided to assign him some light duty issuing clothing, under close supervision because of his reputation. Costello proved to be a good inmate, causing no problems.

  The stay in Atlanta lasted just over two months. The day after Christmas, Costello was transferred to the federal correctional facility in Milan, Michigan. Milan was a low-security institution about twenty miles south of Ann Arbor. Costello was sent there because in a bizarre legal move, he filed a federal court petition to be freed from custody on the grounds that the penitentiary wasn’t the place he should have been sent to. Since he had been convicted of three misdemeanor offenses—contempt—Costello argued that he really should be housed in a common jail, not a penitentiary. Costello failed in that crazy bid to get free. The result was that he was moved to Milan.

  The correction reports of Costello’s time in Milan showed that he was an easy-going inmate. Costello wanted to be assigned to the hospital wing so that he could receive frequent throat sprayings because of his chronic laryngitis, according to one FBI report. Instead, he was assigned to work in the clothing room, again under close supervision. Although he wasn’t any trouble, prison officials said that the fastidious Costello had to be cautioned about having a dusty cell and seemed “reluctant” to do the necessary cleaning. “He appeared trying to live up to his reputation as a ‘big wheel,’” one prison status report stated.

  Costello may have thought of himself as a big shot but the reality was that his status and reputation had taken many blows. In custody, Costello had trouble keeping on top of mob business back in New York. He was also under pressure from Vito Genovese who after his return from Italy in 1945 managed to escape a murder prosecution in Brooklyn after two prosecution witnesses wound up dead. Facing no more legal pressure—at least for a while—Genovese had steadily been expanding his influence in the crime family, to the detriment of Costello and his allies. As long as Costello was behind bars, Genovese had a greatly strengthened position in the Mafia.

  CHAPTER TWENTY-TWO

  “DEAR FRANK”

  EXCEPT FOR THE TEN MONTHS Frank Costello had spent in jail in 1915 on the gun case, his wife Loretta had never gone for any long period of time without her spouse being nearby. The couple traveled together, most often to Hot Springs and Miami, and their lives seemed very comfortable. Two homes—the apartment on Central Park West and the house in Sands Point—allowed them to enjoy the best of city and country living. Costello didn’t have a nine-to-five job and that meant on most mornings he could take breakfast at home before making the rounds of the barber’s chair in the Waldorf-Astoria, the steam room at the Biltmore and evenings at the Stork Club and Copacabana. But when Costello was shipped out to federal prison in the summer of 1952, Loretta found herself living alone.

  Frank and Loretta never had kids. Leonard Katz in his biography of Costello suggested the problem was one of Loretta’s inability to conceive. As other couples without children do, the Costellos raised two small dogs, a toy poodle and a miniature Doberman pincher. Costello would sometimes walk the pooches in Central Park but more often that task was Loretta’s.

  Loretta certainly spent more time walking with her husband behind bars. Yet a woman of her financial means didn’t want for friends. Cindy Miller, one of her closest friends, remembered recently taking her for walks in Central Park. The two women, Miller remembered, would sometimes lunch at “21.” Miller favored Bacardi and diet coke and recalled how one day as she and Loretta lunched that a man claiming to be Mr. Bacardi told her she was drinking his liquor.

  Another friend who filled the social gap in Loretta’s life and saw that she didn’t want while her spouse was away was publisher Generoso “Gene” Pope Jr., the Italian businessman who parlayed his family fortune to a base of political power of sorts. Pope’s family relationship with Costello stretched back into the early part of the twentieth century. Pope’s son Paul, in his book The Deeds of My Fathers: How My Grandfather and Father Built New York and Created the Tabloid World of Today, related how it was Costello who helped his grandfather, Generoso Pope Sr., when he had problems with competitors in the stone and cement business. Costello arranged for the senior Pope to meet with Tammany Hall politicians and got suppliers to Pope’s Colonial Sand & Stone business to give it generous financial terms, recalled Paul Pope.

  In the months before Costello went on trial for contempt of Congress, Generoso Pope Jr., wanted to buy the then failing New York Inquirer but didn’t have enough money for the purchase. Costello gave Pope the $25,000 he needed for the down payment on the $75,000 price with no interest, reported Paul Pope.

  “But there were a few strings attached,” wrote Paul Pope. “The longest of them would be that Gene was not to mention gangsters or racketeers or organized crime in any way.”

  So at a time when other newspapers were reporting news of gangster arrests and Costello’s role as a crime boss, the Inquirer would be silent. One of the writers for the Inquirer was Cindy Miller’s husband John. Pope also reported Costello asked that the Inquirer run nice reviews and features about nightclubs he and his friends had interests in and that the newspaper attack the politicians who were going after organized crime. Generoso Pope would eventually transform the Inquirer into the National Enquirer, the newspaper that was the grandfather of tabloid journalism. While he was in the Milan facility, Costello wanted Pope to visit him and put the publisher’s name on a visitors list as his “advisor,” according to FBI records. It is unclear if Pope actually made any prison visits.

  Under the terms of his incarceration, Costello was eligible for parole on February 14, 1953, a mere six months after he went to prison. His attorneys George Wolf and Joseph Delaney filed the necessary papers to request that Costello be considered for paro
le, and there was some optimism that he might be granted release as a telegram dated February 6 from Loretta indicated.

  “Dear Frank, Saw Mr. Wolf. Parole Board seemed receptive. We are praying for the best. Mr. Delaney will visit you Friday. Don’t worry. Lots of love, Loretta Costello,” she said in her missive.

  If his good behavior in prison was any indication, Costello had a good shot at being released. He did his job in the prison clothing plant and got along well with the staff, even if he did hold himself out as some sort of big shot. With all of the machinations going on in the New York Mafia with Genovese and others, Wolf thought his client was anxious to be freed for no other reason than to get back into the mix of La Cosa Nostra. But on February 20, 1953, the federal Parole Board denied Costello an early release in favor of what records stated was “continuing the subject’s present plan.”

  Eight months later Costello’s good behavior worked in his favor when he was ordered released on October 29, having served a year of his eighteen-month sentence. It was a tanned Costello, dressed in a pinstriped suit and sporting a fedora, who rode away that day just after 8 o’clock in the morning, driving off in a black limousine with his wife, one of her friends, and lawyers. Pursued by reporters in a high-speed chase through Detroit traffic, Costello would only say he wanted a “rest.” At the train station, Costello and his party boarded The Detroiter for the overnight trip to New York. To avoid the press, Costello got off the train when it arrived the next morning at the Croton-Harmon station in Westchester County and then was driven to Manhattan.

  Once back in New York City, Costello tried to have some peace and quiet. His doctor said he had some “pulmonary congestion,” had lost weight, and ached from a viral infection. Since Manhattan was in a different federal court district from Nassau County where Costello had his Sands Point house, he had to petition the court to get permission to visit the Barkers Point Road manse, a request that was granted. A trip to the North Shore and its relative quiet was what he needed.