The Outfit

by Gus Russo

  Maurice M. Milligan, the U.S. attorney who had prosecuted Pendergast, wrote that “Harry S Truman’s career, without the help of Boss Pender­gast, would have ended far short of the White House.” Milligan summed up the career of Truman thus: ’When the Senator became Vice-President in 1944, the political stock of the renascent Pendergast machine boomed, but it was nothing compared with the golden opportunities that came on Mr. Truman’s succession to the Presidency. New offices, vacancies and resignations which were within the gift of the President, all kinds of Federal patronage found grateful acceptance in the ranks of good machine men, all friends of the President.’

  And Pendergast’s nemesis, Maurice Milligan, was promptly relieved of duty by the new president, who appointed a new U.S. attorney to the region. The dismissal came not before Truman’s friends concocted a nefarious scheme to manipulate Milligan to their own ends. When Truman’s Senate reelection bid had come up in 1940, it was widely assumed he would be beaten by the “good government” candidate, Missouri governor Stark. Truman’s people believed that their only hope was to persuade a third candidate, a sure-loser type, that he could actually win, convince him to run, thus splitting the good-government vote with Stark. Realizing that Milligan, a dull bureaucrat and lousy public speaker, was considering a run for the Senate, one of Truman’s closest friends, Tom Evans, paid a visit to Milligan’s brother to put in the fix. Evans convinced the naive Milligans that his intention was pure and that he firmly believed Milligan could be victorious. And to show his conviction, he handed Milligan a $500 campaign contribution. Truman wrote to his wife that if both Stark and Milligan ran, “that would be too good.” As planned, Milligan and Stark nullified each other while Truman snuck through with only a plurality of the vote. Truman historian Robert H. Ferrell wrote: “Truman could not have been renominated without the entrance of Milligan.”

  By any measure, Truman’s presidency was as mixed as his personal ethos. To his admirers, he defeated the Japanese and Germans in World War II, established the state of Israel, and organized NATO. To his detractors, Truman was morally culpable not just for his Missouri compromises, but for the decision to drop an atomic bomb on the population of Nagasaki, after he had already done so on Hiroshima; his formation of NATO was a prime reason Soviet-U.S. relations chilled, leading to the costly and dangerous Cold War; he unnecessarily committed U.S. troops to Korea, fifty thousand of whom returned in body bags. Of Truman’s enigmatic moral code, Richard Lawrence Miller wrote, “Truman loved politics, but he held democracy in contempt . . . [He] would always act insensitively about terrors committed by his political allies in Jackson County . . . He had no patience for anyone, great or small, who felt honesty and public service more important than aid to the Pendergast organization . . . Was Truman really indifferent, or could he just not bear to think about his role and responsibility?”

  The Transfer

  By the time Truman walked away from a presidential reelection bid in 1952, he was dogged by scandalous accusations, not the least of which concerned his possible role in events surrounding Curly Humphreys and the Outfit’s imprisoned Hollywood extortionists. But while Truman was in office, Chicago’s Outfit was little concerned with debating his historical legacy. For the gangsters, all that mattered was that his past rendered him impotent in the face of pressure from America’s empire of crime.

  Fully knowledgeable of Truman’s vulnerabilities, Curly Humphreys placed a call to Pendergast’s legal mouthpiece in St. Louis, attorney Paul Dillon. For years, Dillon was the lawyer of record for Pendergast’s muscleman Johnny Lazia. In 1934 and 1940, Dillon managed (at Pen­dergast’s request) the St. Louis campaign offices for Harry Truman’s two fraud-filled senatorial elections, with the ’34 contest earning the title “The Bloody Election.” With his friend Harry Truman now president, Dillon had an open door at the White House, one of the rare few able to call on a president unannounced. As an added bonus, Dillon counted among his best friends T. Webber Wilson, chairman of the federal parole board.

  Curly next enlisted Edward “Putty Nose” Brady to deliver to Dillon a list of the men he wanted transferred. Years later, when Congress launched a major probe into the transfer, they were denied access to the FBI files that disclosed the Bureau’s plumbing of the Brady connection. When Brady died in 1945, his widow, Helen, was allegedly the recipient of a $20,000 bequest, courtesy of the Outfit, according to a Cicero-based Outfit associate, Willie Heeney, who claimed to have delivered the gift.

  Agreeing to take up the Outfit’s case, Dillon traveled east and began peddling his influence. Upon his arrival in Washington, Dillon first visited the assistant director of the Bureau of Prisons, Frank Loveland, to whom he introduced himself as a close friend of the president’s. Loveland allowed Dillon to make his plea, but ultimately denied the attorney’s request. Aware that his Outfit client Paul Ricca would not accept failure, Dillon proceeded up the chain, and on August 8, 1945, the Atlanta inmates, except for Rosselli, were transferred to Leavenworth, over the objections of prison officials. One year later, Johnny Rosselli was transferred to Terre Haute, Indiana. It may never be known exactly whom Dillon leaned on, but buried in documents discovered years later among the Bureau of Prison files is a memo noting that “[Attorney General] Tom Clark would like the subjects transferred to Leavenworth.” According to FBI sources, the gang left nothing to chance in its push to obtain the transfers. Years later “a reliable confidential informant” in Chicago reported that Johnny Rosselli had enlisted a well-known D.C. lobbyist, gambler, and ex-con named Samuel Roy Beard in the cause. The informant reported that “through his connections [Beard] was able to arrange the transfer of Rosselli and his associates.” The Bureau never determined exactly how Beard figured into the parole strategy.

  While in Washington, Paul Dillon nurtured his friendship with the parole board chairman, T. Webber Wilson, with whom Dillon shared many social dinners. In two years, this friendship, in combination with Dillon’s other political purchase, would play a pivotal role in the fortunes of the Outfit.

  Meanwhile in New York, Johnny Torrio’s Commission suffered a major setback: In February 1946, founding member Charles “Lucky” Luciano was deported to Italy. He had been languishing in New York State’s infamous Dannemora Prison for ten years on white-slavery charges. Luciano’s thirty-to-fifty-year sentence was reduced when he used his underworld connections in both the New York harbor and in Sicily to aid in the World War II Allied effort. Within months, Luciano relocated to Havana, Cuba, from where, according to Curly’s second wife, Jeanne, he made clandestine trips into the United States. “We used to meet him at the Plantation Yacht Club [Plantation Key],” Jeanne recalled. “The boys always threw big ’coming out’ bashes for Lucky at the club.”

  Lucky’s removal only served to exacerbate New York’s intramural Mafia squabbles, a proclivity that has haunted them ever since. By contrast, Chicago’s Outfit was more unified and focused than ever, even considering the recent extortion convictions. The power this unity afforded them was soon to be put on display for the rest of the country.

  1. Robert Hannegan, castigated by the Missouri press for secretly attempting to steal the state governorship from the 1940 Republican victor, was nonetheless named to head the DNC and the IRS district in Missouri by Senator Truman and was later appointed postmaster general by President Truman.

  2. Ickes knew from whence he spoke: He was a former Chicago newsman who was the most influential supporter of 1920s reform mayor William Dever, one of the few Chicago mayors who actually tried to confront Syndicate-influenced political corruption.

  11.

  The Parole Scandal

  What I need is a lawyer with enough juice to get Ray Charles a driver’s license.

  -Lenny Bruce, political satirist

  The transfer to Leavenworth lessened Ricca’s dissatisfaction, but far from eliminated it. Now, at least, the gang boss might be able to turn visiting day into a covert council with his Chicago confreres, Joe Accardo and Curl
y Humphreys. Of course, felons were not allowed visits from anyone other than family and attorneys, but the Outfit was not about to allow a bureaucratic rule prevent their corporation from holding business meetings. The key facilitator in these powwows at Leavenworth was once again attorney Joseph Bulger, the “supreme president” of the Unione Siciliana.

  With Ricca, Campagna, Gioe, D’Andrea, Maritote (Diamond), and Circella now confined together, all that was missing for an Outfit quorum were Accardo and Humphreys. However, taking turns impersonating attorney Bulger, Joe Accardo and Curly Humphreys accompanied Eugene Bernstein, the gang’s tax attorney from the Twenty-fourth Ward, to the high-security lockup to confer with their associates. Bernstein, a former ten-year IRS agent, later said that he had never met Accardo or Humphreys before; he had merely been instructed to deliver them to Leavenworth. “Bulger said he will send someone who is acquainted to help me,” Bernstein later testified. Ricca would later admit to federal investigators that his friends had signed in on visitors’ day by forging the name Joseph Bulger.

  By Bernstein’s own admission, these trips numbered over six, but it is believed that that was an huge understatement. For over a year, the secret Outfit meetings proceeded, with one piece of new business always at the top of their agenda: obtaining an early parole for their “stand-up” partners. Ricca’s demand was virtually inconceivable for countless reasons: They had criminal records and incorrigible reputations as the heirs to Capone; the outstanding mail-fraud indictments involving the IATSE dues were still untried in New York; they owed $600,000 in back taxes and penalties. Despite the obstacles, the Outfit was convinced that its strong ties to Truman’s shadow world would save the day. Putting its nose to the grindstone, the empire of crime confronted the obstacles one by one.

  The Mail-Fraud Problem

  The gang’s brain trust, led by Humphreys, typically decided to attack the problems systematically. First, they took on the impending mail-fraud troubles. Recall that the gang was initially charged, but never tried, for bilking some forty-six thousand IATSE members out of $1 million in dues, most of which had gone into the Outfit’s coffers. By the spring of 1946, after months of planning, the powerful prisoners were ready to approach the man they would delegate to accomplish phase one, a high-powered, Dallas-based attorney named Maury Hughes, considered the best trial lawyer in the South. However, Hughes was employed to use his connections to prevent a trial and to obtain a dismissal of the pending mail-fraud indictments. Hughes had a long association with the Windy City, having defended a number of its more colorful citizens.1 The FBI developed information that led them to conclude that Hughes was also acquainted with Harry Ash, Sid Korshak’s First Ward law partner and Charles Gioe’s parole adviser.

  But it wasn’t Hughes’ Chicago links that were of interest to the gangsters. More important, Hughes was a boyhood friend of fellow Texan, and present attorney general, Tom Clark, Hughes having attended school with Tom’s younger brother Bill. According to his son, Maury, Jr., Hughes was also a friend of President Truman’s and, as a high-ranking Democratic national committeeman, attended the 1944 Chicago convention, working with Sidney Hillman and the rest to guarantee Truman’s addition to the ticket. With his friend Clark controlling the parole board, and his friend Truman controlling Clark, Hughes was the perfect man for the job.

  In the spring of 1946, a man described by Hughes to be of clear Italian descent, with “a swarthy complexion and olive skin,” appeared at Hughes’ Dallas law office. Sporting a gangster-chic pinkie ring with a large diamond, the man introduced himself as “Mike Ryan.” The six-foot-tall, fiftyish man said he lived in Chicago, where he was in the trucking business, but had other interests in California, such as a string of horses he owned.

  “I have a friend in the penitentiary that has a case pending in New York,” Ryan said. “His name is Paul De Lucia.”

  Hughes later told investigators that, despite his familiarity with Chicago, he had never heard of De Lucia/Ricca, or the other defendants. Ryan told him that Ricca had wanted to be a priest as a youth, but had made a wrong turn. “All right, tell me something about the case,” responded Hughes.

  Ryan described the mail-fraud charge that threatened to scuttle Ricca’s parole chances. The gang’s first parole opportunity was over a year away, but they wanted enough time to cover all the contingencies. Hughes agreed to think it over and advise Ryan of his decision. About ten days later, Ryan and two associates met with Hughes in Chicago’s posh Stevens Hotel. Ryan offered Hughes a $1,000 retainer against an extravagant $15,000 fee, plus expenses, if he was successful in having the fraud charges dropped. Hughes’ experience told him that this could be the easiest $15,000 he would ever earn, since courts rarely wasted the time or money for a trial in which a sentence would likely run concurrently with a previous conviction, as they both stemmed from the same general crime. All Hughes would have to do was let the authorities know who his friends were (Truman, Clark, etc.) and demand habeas corpus: either go to trial now or drop the fraud charges. Hughes’ prediction was canny. Although (possibly) unbeknownst to the Dallas attorney, prosecutor Boris Kostelanetz’s own opinion was that the fraud charges should be dropped, since there was little chance the prisoners would be released before 1953. Joe Bulger, who was in the courtroom the day the appeals were heard, reported that Judge Knox said, “I am not going to put any time on this mail-fraud case. You have a conviction in one case, and if that sticks, we are not going to waste any time on these cases.” Hughes’ involvement seemed, according to Congress, to represent nothing more than “an insurance policy.”

  Whether having known or merely intuited the authorities’ recorded views, Flughes accepted Ryan’s offer and proceeded to contact the defendants’ previous lawyers as well as government authorities such as Kostelanetz in New York, and Attorney General Tom Clark’s assistant Peyton Ford in Washington. Over the next year, Hughes journeyed to New York, Washington, and Chicago lobbying for his new clients. (Back in Chicago, on October 9, 1946, the legendary Michael “Hinky Dink” Kenna died. Assorted gamblers and First Ward machine bosses paid their respects. Representing the Outfit, Jake Guzik attended the funeral.)

  During the hotly contested 1946 off-year elections, Chicago Tribune reporter Jim Doherty was among the first to learn of the next phase of the Outfit’s parole strategy. “We began hearing that there was considerable agitation in the Italian wards of Chicago, that efforts were being made to push Republican Italians over into the Democratic fold,” wrote Doherty. Hitting the streets of the Italian ghettos, Doherty was told, “The word is out, we all got to go Democratic this time.” One of Doherty’s editors got to the bottom of the vote push when an Italian friend disclosed, “We have got the word. We have to go Democratic this time so four guys can get out on parole.” Doherty subsequently located Italian Republican ward leaders who were later punished by their party for succumbing to the peer pressure and actually delivering the vote to the Democrats. “The facts were and the record showed that those Italian Republicans did vote Democratic,” Doherty testified. “Those Italian Republican leaders delivered ten thousand or fifteen thousand votes to the Democratic organiza­tion.” According to Mooney Giancana, the Italians were putting on a show; they merely wanted to prove to Truman what they could do for him when his election came up in 1948.

  With the parole gambit moving apace, the Outfit did not ignore the day-to- day business of organized crime. In December 1946, Joe Accardo headed an Outfit delegation to a national Commission meeting in Havana, organized by Meyer Lansky, who had been invested in Cuban casinos since the midthirties, and the deported Lucky Luciano, who had snuck into Cuba. More than two dozen regional bosses and their families arrived on December 21, finding themselves ensconced on the top four floors of the luxurious Hotel Nacional.2 As with any upperworld convention, meeting rooms and banquet facilities were all booked in advance, while the criminal conventioneers conducted their business in a manner not unlike that of their upperworld counterparts. On the fi
rst night of the conference, December 22, the attendees threw a lavish bash in which they paid tribute to Luciano by handing him envelopes stuffed with cash. When Luciano totaled the $200,000 Christmas gift, he announced he would use it to invest in the National’s casino.

  Over the Christmas holidays, the bosses met to deal with the key items on the conference agenda: the infighting of New York’s five “families”; the wisdom of engaging in the narcotics trade (Luciano and Costello were against it); and the “Ben Siegel situation.” Siegel had been spending the Commission’s money as if it were water in the Nevada desert, constructing the first of the glitzy Las Vegas hotel-casinos, the Flamingo. His original budget had been $1.5 million, but Siegel had managed to squander over $6 million, with rumors rampant that he was skimming from his Commission partners.

  On Christmas Eve, the confreres were treated to a party honoring Frank Sinatra, who had arrived from Chicago with Accardo and the Fischetti brothers. In his memoirs, Luciano asserted that years earlier he had put up $60,000 to jump-start Sinatra’s fledgling career. Congressional investigators believed that Sinatra couriered a briefcase stuffed with over a million dollars to Luciano at the Havana conference, as the return on Lucky’s investment. In later years, Sinatra would visit Luciano in exile in Italy. Syndicated columnist Walter Winchell wrote, “When Italian police raided Lucky’s lavish apartment in Rome, they found a sterling silver cigaret case, inscribed: ’To My Dear Friend, Charlie Luciano,’ over one of the most sought-after American autographs, that of a young star, a known gangster lover.” Although Winchell did not name him, the facts soon emerged that the signature read, “Frank Sinatra.”3