A long tradition of keeping Slavic peasants
inebriated is reflected in many names from the
shtetl: Winiarz, Winiarski (for making wine, a legal
cover and side business) and Gorzelnik (the making
of vodka or other hard liquor, the dominant business
and usually illegal). One such humble-looking dynasty
was the Bronfmans.
After yet another crackdown on moonshine by the Tsar
in 1889, the Bronfmans relocated to a distant yet
familiar environment. They set up shop selling booze
to German farmers on the border of Saskatchewan
and Montana, the easier to escape the jurisdiction
more rigorous at the moment. Of the four children,
Abraham, Alan, Harry, and Samuel, Sam proved to
have the most chutzpah, changing the face of
the Bronfmans' new-found continent.
In 1916 Sam and Harry moved back east and opened a retail liquor
outlet in Montreal. The duo are also reported to have started up a
chain of "little hotels": according to Bronfman parter James
Rutkin, "they sleep very fast. They rent them quite a few times
a night."
Sam also had stills across Canada near the U.S. border, for instance
at his parents' old haunts at Yorkton and Regina, Saskatchewan
and a liquor warehouse at Govenlock six miles north of the border
on the Wild Horse Trail. The single-store town of Govenlock made a
fortune on bootlegging, starting illegally when Canadian provinces
went dry, then booming when the tables reversed and the U.S. went dry.
Another major smuggling point crossed from Manitoba to North
Dakota.
South of the border, in 1919, the 18th Amendment (Prohibition) was
passed empowering the Volstead Act. Samuel Bronfman made such
a fortune bootlegging, all along the U.S./Canadian border but
especially from Quebec, that Lake Erie became known as the "Jewish
Lake" for his famous speedboats. He joined forces with Meyer Lansky,
"Waxy" Gordon (Irving Wexler), Lucky Luciano, and a host of other
mobsters to become the major liquor distributor in the United States.
Canada's Parliament also passed in 1919 some restrictions against
hard liquor, specifically labelling it a drug. Harry Bronfman
found the loophole: he got a pharmacy license and renamed the
family business the Canada Pure Drug Company.
Samuel Bronfman had problems with the petty racketeers who drove
the trucks across the border. They were too greedy, too numerous,
and not trustworthy kinfolk. Meyer Lansky's Murder, Inc. provided
the essential service of weeding their ranks.
Bronfman's exports gave birth not only to the modern Mob, but also
to modern money laundering, according to financial expert J. Orlin Grabbe:
Exporting alcohol to the U.S. was not illegal in Canada; it was only
illegal to import it from the U.S. side. Naturally those writing checks to
pay for imported Canadian booze didn't like to be so obvious as to make them
out to Bronfman. So the Bronfmans opened up an account at the Bank of
Montreal under the fictitious name "J. Norton". Since no one knew anything
at all about J. Norton, money could be wired to this account from the U.S.
Or U.S. cash or checks could be used to purchase a bank draft made out to
"J. Norton" at any branch of the Bank of Montreal. These drafts could then
be deposited into the bank account of any Bronfman-controlled company. The
company treasurer would see the name "J. Norton" and credit the payments to
the company's U.S. Booze account.
Lansky, along with Bronfman and his partners Tibor Rosenbaum
and Louis Bloomfield, set up money laundering rings between
the U.S., England, Palestine (later Israel), Switzerland,
Cuba, the Bahamas, and Canada, among many other locations. They
became intimately familiar with the nature of bank account
control and the forgery of bank documents.
For such a scheme to work requires people at all stages of
handling large amounts of money who can be trusted: people of
the same kin and religion. This forms a network of trust, of the
same kind that can be found among Chinese merchants in Souteast
Asia, for example.
All told, over half the bootleg shipped to the U.S. during
Prohibition was shipped by Sam and Harry Bronfman. One of the rivals
of Bronfman/Lansky partnership was a more famous but lower volume
bootlegger, Joe Kennedy. That rivalry lasted long after Prohibition
ended, but that is another story.
In 1920 Lansky and Sam Bronfman entered into collaboration with "Big
Maxie" Greenberg, a veteran Detroit mobster, and Arnold Rothstein,
who owned a chain of New York gambling casinos. Rothstein and
Bronfman bankrolled the operation, purchasing "safe" sites in Maine
to import liquor, while Greenberg went to St. Louis and "Waxy" Gordon
took over New Jersey.
In 1926, Sam and Harry Bronfman negotiated the Canadian
distribution rights for Distiller's Company Limited of
Edinburgh, London. This giant British conglomerate
sold more than half the world's scotch, and the Bronfmans
became the official vehicle whereby they distributed
to North America. DCL's board of directors included
Lord Dewar, Field Marshal Earl Haig, Sir Alexander Walker,
and so on. While the Bronfmans in good shtetl tradition
laid low and painted for themselves a humble, put-upon
portrait, the British lords immortalized themselves as brand
names. The next year, the Bronfmans purchased the old Canadian
firm of Seagram's, and began to experiment with "blended"
(i.e. watered) whiskey.
In 1929 Meyer Lansky, "Longy" Zwillman and Louis "Lepke" Buchalter
host a meeting of gangland bosses -- including Al Capone, Frank
Costello, Charlie "Lucky" Luciano and Johnny Torrio -- at Atlantic
City's President Hotel to hammer out a "cartelization" of territories
for activities that went far beyond bootlegging. This is the beginning
of "Crime, Inc."
In 1933 Prohibition was repealed. Meyer Lansky, Benjamin Siegelman
("Bugsy" Siegel), Samuel Tucker, Moe Dalitz, Morris Kleinman and
Samuel Rothkopf, all of whom escaped prosecution, built a chain of
distilleries across the northern United States, selling millions
of gallons of alcohol to liquor manufacturers without bothering to
pay excise taxes. Bronfman, by now worth billions, kept making
and selling hard liquor, but also diversified into a wide range of
properties, including Texas Pacific Oil Co. Inc, Ranger Oil,
Tropicana, and Dole.
The end of Prohibition brought major trauma as cash flows in need of
protection shrank and mobsters fought over the remaining heroin and numbers
rackets. In 1936 "Dutch" Schultz (portrayed in movies as a blond German
villian, but really a black-haired Jewish neighbor of Lansky and Rothstein),
divulged plans to assassinate Thomas E. Dewey, at that time U.S. Attorney
for New York. Buchalter and Lansky had Schultz gunned down and his
territory divided among the cartel. Dewey then turned his agents loose on
Buchalter and Shapiro. The two went into hiding, and set about "eliminating"
potential talebearers. Over the next three years more than a hundred
gangland figures are purged by "Murder, Inc."
postscript:
Arnold Rothstein's son, Murray, would change his name to "Sumner
Redstone" and combine a wide array of U.S. media properties into the
mass media giant Viacom. Samuel Bronfman's grandson, Edgar Jr. would
buy media giant MCA/Universal. Both media houses heavily promoted
and widely distributed movies featuring Italian-Americans as
gangsters, conveniently leaving out the leading roles of their
forebears. The Bronfmans have also had many other adventures,
which may be related in a future post.
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