-Caveat Lector- <A HREF="http://www.ctrl.org/"> </A> -Cui Bono?- an excerpt from: Crime on the Labor Front Malcom Johnson©1950 McGraw-Hill Book Company, Inc. New York. 243 pps. - First Edition - Out-of-Print --[2]-- CHAPTER TWO Hollywood Shakedown THE UNITED STATES is still suffering from some of the evil effects of the Prohibition Amendment, perhaps the most thoroughly ignored law ever written on the national statute books. The "noble experiment," as Herbert Hoover called it, introduced an era of lawlessness such as this country had never -known, marked by wholesale murder, open warfare between rival bootleg gangs, and a complete cynicism and disregard for law and order by a large segment of the public, which saw gangsterism and politics closely allied. It was a period of political corruption on a national scale, with legislators, judges, and other public officials bought and sold with gangster money like so many sacks of potatoes. It was a period in which professional murderers, as typified by the bootleg gangsters, came to be regarded as colorful heroes whose exploits were celebrated in the movies and in the newspapers. Some of the top gangsters and racketeers in the country today first rose to power during that period of machine-gun law. With the passing of prohibition they turned inevitably to other lawless activities. One of these was the labor racket. Of all the gangsters who flourished during prohibition, none attained such power and wealth as Scarface Al Capone. This deceptively mild-looking little man with soft brown eyes migrated from Brooklyn to build an empire of crime in Chicago with influential underworld connections throughout the country. It was one of the ironies of the times that Capone enjoyed complete immunity from the law for the reign of terror he invoked. He was never brought to trial for any of his major crimes, including innumerable murders committed by his paid gunmen on orders from himself. When the law finally nailed Capone it was for income-tax evasion. He was convicted in 1931, served seven years in prison, then retired to a life of luxury in Florida until his death, of paresis, in January, 1947. Capone's gang lieutenants carried on his organization, which is still active in Chicago. Though its chief source of income during prohibition was from the sale and distribution of liquor and beer, the Capone mob owned brothels, gambling establishments, and night clubs. In addition, the mob perfected the "protection" racket as it is now known—the device of levying tribute from businessmen for the privilege of staying in business. The protection, of course, was from the gangsters themselves; if the victim did not pay, a bomb, or "pineapple" in the mob vernacular, was exploded in his place of business. The racket usually was worked through a trade association, so-called, to which the victims were compelled to belong. When the Capone gangsters invaded the labor field after the death of prohibition in December, 1933, they applied the same technique of intimidation against the unions and their members. One of the gang's first and most successful ventures in labor forms an almost incredible story of extortion in the motion-picture industry. The story is now a matter of public record through the court testimony of a convicted labor racketeer who squealed against his gangland bosses. It is a story with strong political implications, with hints of bribery in high places. It is a story of how the most notorious gang in the country, working through union officials, brought the entire Hollywood movie industry to its knees. The story properly begins in Chicago in 1932 as the prohibition law was on its way out. It was a bleak year in the depth of the nation-wide depression: a year of soup kitchens, bread lines, bank failures, shuttered factories, and of jobless, despairing men tramping the streets in a vain search for work. It was a bad year even for labor racketeers. Nevertheless, a paunchy little man of boundless cupidity named Willie Bioff was doing his best to turn a dishonest dollar by organizing and preying upon Chicago's kosher butchers. Bioff was a panderer, a thief, an extortionist, and an all-round racketeer and gangster. His name a few years later was to strike terror in the hearts of the Hollywood movie moguls. In that year, 1932, Bioff met a professional unionist, one George E. Browne, business agent of Local 2 of the International Alliance of Theatrical Stage Employees, an American Federation of Labor union with jurisdiction over motion-picture-theater projectionists and allied theater workers. As a sideline, times being what they were, Browne was organizing chicken dealers. It was a fortuitous meeting-for Bioff and Browne. Both had only one interest in the labor movement: to gouge money out of it. Each was quick to appreciate the talents of the other. As a labor leader, Browne, tough and thoroughly corrupt, was more than willing to accept the aid of a smarter racketeer. He found one in Willie Bioff. While Browne was a good front man, Bioff was the schemer, the planner, the strategist with an utterly ruthless talent for extortion. Bioff and Browne joined forces, abandoned the kosher market, and concentrated on the theatrical union as offering greater possibilities. Nominally, Bioff became Browne's assistant. Actually, he was the brains of the combination. Browne's union local was in a bad way. Out Of 400 members, 250 were unemployed. There was no profit for Browne and Bioff in unemployed union members. They decided to mix charity with business by setting up a soup kitchen where a working member could get a meal for thirty-five cents and the unemployed could eat free. They persuaded politicians and theatrical celebrities to drop in frequently for meals and contribute $20 to $50 to a good cause. The contributions served the double purpose of keeping the local alive and providing Browne and Bioff with a small income. The contributions also gave Browne and Bioff the idea for their first successful shakedown. In 1934 the pair went to millionaire Barney Balaban of the Balaban & Katz theater chain with a demand that he restore a pay cut imposed on IATSE members in the Balaban & Katz theaters in 1929. They had no illusions about getting the cut restored, nor did they want it. Their interest never was in the welfare of the workers except when it was a means of extorting more money from them in dues, initiation fees, and assessments. Balaban appeared to give their request serious thought. He said he might be willing to comply, but was afraid that if he did so, other unions would jump in with similar demands. That would be too costly. Browne and Bioff then casually mentioned the soup kitchen, observing that it cost $7,500 a year and was serving a humane cause. Balaban got the point. He saw immediately that paying for the kitchen would be much cheaper than restoring the pay cut. His attitude re-flected that of many businessmen who paid off labor rack-eteers. In permitting themselves to become extortion victims they nearly always were seeking some advantage for them-selves, usually at the expense of the workers. Obviously the large sums paid to labor gangsters were never passed on to the workers. In any event, Balaban volunteered to pay for the soup kitchen in lieu of restoring the pay cut. He quickly discovered that Browne and Bioff had no intention of letting him off so lightly. "I figured right then I might as well kill a sheep as a lamb," Bioff boasted in court. "Barney turned out to be a lamb. When he agreed to our suggestion I knew we had him. I told him his contribution would have to be $50,000 unless he wanted real trouble. By that I meant we would pull his projectionists out of the theaters. He was appalled, but we turned on the heat. He finally agreed to pay US $20,000. The restoration of the pay cut was forgotten. We were not interested in that then or at any other time. We didn't care whether wages were reduced or raised. We were interested only in getting the dough, and we didn't care how we got it." >From the day that Balaban coughed Up $20,000, Browne and Bioff knew that they were on top of a lucrative racket. joyously they celebrated the knowledge by spending $300 at a night club and gambling resort operated for the Capone mob by Nick Cercella, alias Nick Deane. As they wined and dined on the money that they had extorted at the expense of their members, they boasted of their recent good fortune. A few days later, Frank Rio, a leader in the Capone gang, accosted Browne and demanded to know how the union was making out. Up to this point the mob had let Browne alone; the "take" wasn't enough to interest it. But the first big shakedown changed the picture entirely. Browne spun a woeful tale of his union's impoverished state, but Rio was unimpressed. "From now on," he said, "we expect 50 per cent of the take. Everything you get. Understand?" Browne and Bioff understood perfectly. The Capone gang had muscled in on them, as it had on so many other union locals. It was a case of the big fish swallowing the small fish. Browne and Bioff knew that they had been served with the usual "or else" proposition. They agreed to cooperate, for they had no choice. On the one hand they hated to surrender half their union booty. On the other hand they were smart enough to know that, with the Capone mob's backing, the "take" should be much larger and that future expansion would be made easier. The gang's reputation for terrorism, built up over the years, would take care of that. It should be remembered that the mobsters at no time had any official connection with this or any other labor union except insofar as they were able to plant their own stooges in union offices. Their sole interest in a union was the profit in it for them. They operated behind the scenes, issuing orders and directing policy through their captives in the union. In this instance they took over by intimidating two thieving union officials who were not too unhappy about being taken over. The capture of Browne's local was just the beginning. The mob was determined to expand and gain control of the international union. They intended to do it by using Browne as a front man. A meeting was held. Present were Browne and Bioff; Frank Nitto, or Nitti; Louis Campagna, Paul DeLucia, and Rio-all top men in the Capone circle. Nitto, a first cousin of Capone, was known as the Enforcer. When Capone went to jail on income-tax charges Nitto was regarded as the number one man in the gang's underworld enterprises. Campagna was one of Capone's ex-bodyguards. The gang chieftains knew that Browne had been defeated in 1932 for president of the international union. They told him he was to run again and get elected. There must be no mistakes this time. Where were the weak spots, the places in the national organization that had failed to support him? New York City, New Jersey, Cleveland, and St. Louis, Browne Said. The gangsters explained that their out-of-town connections would help this time-Abner (Longy) Zwillman, racket boss of New Jersey; Louis (Lepke) Buchalter and Charles (Lucky) Luciano in New York, and lesser known gangsters in Cleveland and St. Louis. For another meeting, two weeks before the June, 1934, convention of the IATSE, Lepke was summoned from New York. Nitto gave Lepke a message for Luciano, New York's vice overlord and member of the syndicate: "Local 306 (the New York projectionists) was to vote for Browne for president." "I won't have to see Lucky on that, Frank," Lepke replied. "I can handle it myself. I'll also see Kaufman of New Jersey [Louis Kaufman, business agent of the big Newark local] and see that Longy [Zwillman] delivers that outfit." The campaign went exactly as planned. The Capone syndicate's representatives in the key cities spread the word: "Vote for Browne." As a final gesture to insure success, the syndicate's far-flung representatives gathered in Chicago and from there descended on the international union's convention in Louisville. The presence of the nation's top gangsters and their gunmen at the convention, circulating among the delegates and openly backing the candidacy of Browne, created such an atmosphere of intimidation that opposition wilted. Browne was elected without a single dissenting vote. Democratic processes were forgotten and the best interests of the dues-paying union members were ignored. Everybody at the convention knew that the Capone gang had made a successful bid for power and was now in control of the union. President Browne's first official act was to announce that Willie Bioff was his "personal representative." The convention delegates knew what that meant too: Bioff was giving orders for Browne and through Browne. Backed by the Capone gangsters and their powerful out-of-town connections, Bioff and Browne were quick to solidify their control of the entire union. The Capone syndicate appointed Nick Circella to oversee their activities and to report back to the syndicate. Browne and Bioff were warned against double-crossing the syndicate unless they wanted to retire feet first. From then on they were tools of the mob in a major racket venture, and the stakes were high. When Bioff and Browne departed for New York to chart a campaign of extortion and to "confer" with theater owners and other union officials, they were told to feel free to call upon Luciano or Frank Costello any time they needed help. "They are our people," gangster DeLucia explained, according to Bioff's testimony. This was long before Costello, gambler, ex-convict, and slot-machine racketeer, had become such a controversial and influential figure in New York City politics. In Chicago the mob, through Browne and Bioff, extorted $100,000 from motion-picture theater chains by threatening to force them to hire two projectionists in each theater booth instead of one. The Balaban & Katz circuit paid $60,000; Warner Brothers $30,000; and an independent chain, the S. & S., $10,000. Here again the racket fee was at the ultimate expense of the union workers. There would have been more work for more members had the union's demand been on the level. When one theater representative protested bitterly that putting two projectionists in a booth would drive him out of business, Bioff replied, "I can't help that. If this is going to kill drama, then drama has got to die." After this shakedown, the Capone mobsters gave Browne and Bioff the bad news that henceforth the gang's take was to be 75 per cent instead Of 50 per cent; Browne and Bioff could divide the remaining 25 per cent between them. The mob's brazen method of operation was further demonstrated in the case of a burlesque-theater owner named Jack Barger. When Barger opened a new theater in Chicago, Bioff called on him and calmly announced that Barger would have to surrender half his profits. "Barger raved and said it wasn't fair, but I told him that was the way it had to be if he wanted to stay in business," Bioff recalled in court. "He went along." On orders from Bioff, the wages of union members were slashed and stagehands were laid off so that the profits would be bigger for division with the mob. This was during the worst part of the depression, when work of any kind was hard to get and good men and their families were going hungry through no fault of their own. Yet a union whose ostensible purpose was to better the living conditions of its members was deliberately and pitilessly throwing men out of work and cutting wages. Not content with this abuse of the members, Bioff milked another $200 a week from the theater owner, Barger, when he discovered that Barger was drawing that amount for himself in salary. The gang promptly put one of its own men on the payroll for a like amount for doing nothing. They closely scrutinized Barger's books to see that they got their full share of the money. In fact, they ran the business. Every time Bioff saw Barger, he would taunt him by asking "How's our business, partner?" Like other labor racketeers before and since, Bioff and Browne extorted money from their victims by a variety of methods. They sold "strike prevention insurance" for whatever they thought the traffic would bear. They threatened wage hikes and shorter hours, demands which were promptly withdrawn and forgotten when payment was made directly to them. They ruthlessly sold out their members by agreeing to wage cuts or longer hours. One of Bioff's greatest triumphs in the field of "strike prevention" was the $150,000 he extorted from Charles Moscowitz of the Loew's theater chain in New York in 1935. By 1936, two years after seizing control, the Capone gang's power in the union was such that it was ready to launch a daring offensive against the billion-dollar industry of Hollywood itself. Millions in extortion fees were the stake. The union had only a small membership on the West Coast, but that did not deter the mob. They persuaded the West Coast studios to give the IATSE jurisdiction over labor by exerting pressure against movie outlets, notably the Balaban & Katz theater chain, a subsidiary of Paramount Pictures. It was necessary, however, to close every theater from Chicago to St. Louis before the theater officials saw the light and influenced the West Coast companies to give the IATSE jurisdiction. That done, Bioff in the fall of 1936 went to Nicholas M. Schenck, president of Loew's and spokesman for the movie industry in dealings with the union. "You have a prosperous business here," Bioff told Schenck. "I elected Browne president of this union because he will do what I say. I am the boss and I wan t $2,000,000 Out Of the movie industry." "I was shocked," said Schenck, recalling the conversation. "At first I couldn't talk. But Bioff said, 'You don't know what will happen. We gave you just a taste of it in Chicago. We will close down every theater in the country. You couldn't take that. It will cost you many millions of dollars over and over again. Think it over.' " The movie bigwigs, including Schenck, the late Sidney Kent of Twentieth Century-Fox, and Leo Spitz of RKO, thought it over and decided to pay. An agreement was reached by which the major companies were to pay $50,000 a year and the minor companies $25,000 a year to the racketeers. The payments were to continue indefinitely—forever, if Bioff and the mob had their way. A first payment Of $75,000 in cash was made to Bioff and Browne in a room in the Hotel Warwick, New York. Schenck brought $50,000 and Kent $25,000. Bioff and Browne dumped the money on a bed and carefully counted it, while Schenck and Kent watched, squirming. The full story of the audacious Hollywood shakedown is a matter of court record today because Willie Bioff outsmarted himself. Otherwise the conspiracy might never have been revealed. juggled bookkeeping and a dummy loan finally started Federal investigators on his trail. Bioff, like Capone before him, first attracted the government's attention in connection with income-tax evasion on a transaction of $100,000. Bioff's talent as an extortionist had won him a bankroll of $100,000 which he was anxious to conceal from the government. He yearned to buy a ranch in California, but knew an investment of that kind would arouse the curiosity of the tax agents. So in 1938 Bioff pretended to borrow $100,000 from Joseph M. Schenck, then chairman of the board of Twentieth Century-Fox and a brother of Nicholas M. Schenck. Bioff realized that it would look curious for Schenck to make him a loan of that amount. Therefore he arranged with Schenck for the latter's nephew, Arthur Stebbins, to give him a check for $100,000. Bioff gave Stebbins the cash in return. On the books, however, the transaction appeared as a loan, guaranteed by Schenck, with Bioff giving a note. In the eyes of the government it appeared that Schenck had derived an income of $100,000 in a deal he had not reported. In the chain of investigations which followed, other irregularities were discovered. Schenck was indicted for income-tax evasion and sentenced to three years in prison. The sentence was reduced to one year and a day for perjury after Schenck gave evidence against Bioff and Browne leading to the discovery of the extortion conspiracy and the union's backing by the Chicago mob. Browne and Bioff were indicted for extortion and conspiracy, tried, and convicted in 1941. Bioff was sentenced to ten years in prison, Browne to eight years, and each was fined $10,000. In prison the two racketeers squealed on their gangland bosses. The mobsters were indicted by the government on March 18, 1943, on charges of conspiracy, extortion, using the mails to defraud, and of having extorted more than $2,500,000 from union members and motion-picture producers. Frank Nitto, the Enforcer, named in the indictment, committed suicide. Nick Circella pleaded guilty. Frank Rio had died in 1935. The defendants brought to trial were Louis Campagna and Paul DeLucia (mentioned previously), Phil D'Andrea, Francis Maritote, Ralph Pierce, Charles Gioe, John Roselli, and Louis Kaufman. Except for Kaufman, they were all members of the Capone group. Each had a long police record. Maritote, for instance, had been arrested twenty-seven times. The gangsters were tried in New York. Willie Bioff was the principal witness a gainst them. He testified with gusto, his hard, pig-like eyes gleaming from behind thick glasses. For days Bioff was on the stand, spilling out the story of the mob's control of the union and of the extortion plot. Obviously relishing his role, he boasted of his own part in the plot and implicated all the defendants. His attitude was that he was a gone goose anyway and that the gangsters deserved punishment, too. He, Bioff, was going to see that they got it. The gangsters listened impassively as Bioff, smirking and leering at them, gave evidence that was to convict them. Browne, though less flamboyant, corroborated Bioff's testimony. Their testimony, together with that of the movie producers who admitted the payments to the union racketeers, convicted the Capone gangsters. They did not take the stand in their own defense. The defense lawyers contended that the sums paid to Bioff and Browne were straight bribes to influence their actions as union officials, and not an extortion plot involving the defendants. It was shown that Bioff was on friendly terms with the producers, despite the fact that he was extracting huge sums of money from them. They deferred to him, entertained him in their homes, and wined and dined him on lavish trips to Europe-all at company expense, of course. The money expended in this manner was not denied, but the jury refused to swallow the bribery defense. At one point when Bioff was telling how frightened the producers were during the shakedown negotiations, he was asked if they were afraid that the money they paid him was a bribe, making them liable to prosecution. Bioff said he didn't know anything about that. Didn't lie know that under New York law it was a criminal offense to offer a bribe to a union official to influence his action? "No, I didn't know that," Bioff replied. "I wish I had. I could have used that." "How?" "Why, to get more money out of them. That would have given me another hold on them." Boasting of his talents as a chiseler, Bioff told, among other things, how he obtained $5,000 worth of furnishings for his new Hollywood home from Leo Spitz, RKO executive. "I hadn't collected the money his company owed us and I figured I might as well get something out of them," said Bioff. "So I went to Leo and I said, 'Leo, 1 gotta have some drapes and other things for my new home and I thought maybe you could get them for me wholesale through RKO's purchasing department.' Of course, I didn't intend to pay for them," he added parenthetically. "Did you get the furnishings?" "Yes, but unfortunately I am still charged with them and I understand they are going to sue me now." "Did you get any other gifts?" "No, but I hinted." "Did any of these defendants get any share of those gifts?" Bioff flashed the gangsters a triumphant smile. "No, sir!" he replied. "That's one spot where I beat them." Bioff said that once when things looked tough he threatened to quit the racket. The mobsters told him that anybody who resigned from the syndicate resigned from life as well. "That is why I never resigned," he said. Bioff's fears were justified. The gang's rule of the union was marked by warfare in the old Chicago style. Tommy Malloy, tough business agent of Local 110 of the union, balked at splitting his take with the mob, and was promptly and permanently removed. In February, 1935, Malloy was shot to death with sawed-off shotguns. Clyde Osterberg, who tried to organize apprentice operators in defiance of the gang's ruling, was eliminated in a similar manner. Fred Blacker, nicknamed Bugs because he scattered bedbugs in the theaters of recalcitrant exhibitors, was killed when the gang felt that he was on the verge of talking. The fear instilled in the movie producers was described by Major Albert Warner, vice-president and treasurer of Warner Brothers. Knowing the background of these people, Warner said, he was afraid of personal injury as well as property damage when Bioff first approached the producers in 1936. Warner and other executives testified that they did not feel that they could a fford to fight the union and the gang behind it. The ever-present subject of political influence cropped up several times in Bioff's long-winded recital, but was never developed by the prosecution. In 1937 the California legislature began to investigate labor conditions in the movie industry. Bioff claimed in court to have paid $5,000 to a certain Colonel William Neblitt, an influential California politician and law partner of the late Senator William G. McAdoo, presumably to arrange a quick end to the legislative inquiry. Bioff's accusation was never followed up, but in 1941 Colonel Neblitt sued some twenty-five defendants—Bioff among them-for malicious and unfounded attacks." "Good old honest Colonel Neblitt," as Bioff facetiously termed him in court, lost the case. Usually Bioff and Browne had to threaten the movie executives into buying protection and cooperation. In at least one instance, however, a theater executive took the initiative and sought out the services of Bioff. It was another case of a businessman eager to sit down with the lowest type of criminal in order to obtain some financial advantage. This particular executive was so anxious for the opportunity that he secured the services of a prominent lawyer with high political connections to arrange a meeting with Bioff. Bioff swore in court that Sol Rosenblatt, a New York lawyer, formerly general counsel to the Democratic National Committee and administrator under the NRA for the movie industry, received 25 per cent of a $25,000 bribe paid to him (Bioff) in 1937 by George Skouras of the Fox theater chain in New York. "It was a bribe, Sir, and a welcome one," was the way Bioff put it. He said that Rosenblatt invited him to a meeting with Skouras in Rosenblatt's plush New York office. There Rosenblatt told Bioff that Skouras was in a "kind of trouble" and that perhaps Bioff could remedy it. Bioff's nose for money began to twitch. just what was Mr. Skouras's trouble? Skouras explained carefully. He operated a chain of eighteen movie houses, similar to a rival chain, the Frisch-Rintzler outfit in Brooklyn. They showed the same kind of pictures at the same time, even dealt with the same banks. But there was a difference which Skouras found embarrassing. The competing chain was able to operate its projection booths for $60,000 a year less than it cost Skouras. The banks were chiding him for this seeming extravagance and inefficiency. If Bioff could put the competing chain on a "comparable basis" it would be worth $50,000 to Skouras. Bioff complied. His method was characteristically direct and unorthodox. "As a result of that conversation I called up the heads of the Frisch-Rintzler circuit and increased their scale $60,000 a year," testified Bioff, the great equalizer, in court. That was his idea of a comparable basis, but Skouras was "a little disappointed," Bioff admitted. It wasn't quite what Skouras had in mind and he didn't think the method was worth $50,000, SO they compromised for $25,000. "And you got 75 per cent of this $25,000?" "Yes, Sir." "And did Sol Rosenblatt get the other 25 per cent?" "I believe he did." "That was his fee?" "Yes, Sir." Bioff said that his share, in cash, was delivered to him by Rosenblatt. Christmas presents for "the boys" in Chicago came high that year, 1937, and the Hollywood producers played Santa Claus. Bioff was the collector, explaining that "the boys" would be expecting something for Christmas and that he didn't want to disappoint them. It might not be safe. He said he collected a Christmas fund Of $7,500 from Harry M. Warner, president of Warner Brothers. Bioff gave a succinct picture of what he had in store for the cowed Hollywood producers had not the government interrupted his plans. "Given time," he volunteered, "I would have got, first, 20 per cent of all the profits and eventually a 50 per cent interest in the studios themselves. The producers had to dance to my music." Bioff's brother-in-law, Norman Thaw Nelson, shed some more light on the manner in which the extortion payments were covered up on movie-company books. From June, 1937, until early in 1939, he was the nominal recipient Of $77,448 paid to him through a film agency, but he actually kept only $125 a week for himself. Ostensibly the money was for commissions on the sale of raw film to Metro-Goldwyn-Mayer; actually it was a bookkeeping device to conceal payments to Bioff. Nelson got the money as a collector for Bioff. It was paid through the firm of Smith & Allar, Ltd., distributors of motion-picture film. Nelson was introduced to one of the agency officials by Louis B. Mayer, production chief of M-G-M, who said, "This is Mr. Bioff's brother-in-law. I want you to put him in the film business." Thereafter Nelson collected weekly checks for Bioff totaling from $2,000 to $3,500 a month. Six of the Capone gangsters and Kaufman, the Newark union official, were convicted after a trial of six weeks. D'Andrea, DeLucia, Campagna, Gioe, Maritote, and Roselli were sentenced to ten years each in Federal prison and fined $10,000 each. Kaufman got seven years and a fine of $10,000. Commentino, on the verdict, Judge John Bright, the trial judge, said, "I think the evidence showing the guilt of these defendants was practically undisputed. None of them, with the exception of Kaufman, was a union member. The evidence, in my opinion, amply sustains the verdict." But how long can big-time gangsters be kept in prison, once the law is lucky enough to obtain evidence sufficient to send them up? Not long, if they have the wealth, power, and influence of the Capone mobsters. Four of them, D'Andrea, DeLucia, Campagna, and Gioe, were released on parole by the Federal Parole Board on August 13, 1947, after serving the bare one-third minimum of their sentences required to make them eligible for parole. The action provoked a national scandal. Charges of political influence were bandied about. The names of President Truman and Tom Clark, then Attorney General and now a justice of the United States Supreme Court, were mentioned, although, of course, it was never established that they knew anything about the paroles or about the political pressure exerted in behalf of the gangsters. A House subcommittee investigated, taking testimony in Chicago. Representative Clare Hoffman of Michigan, Republican chairman of the subcommittee, charged that President Truman and Attorney General Clark had refused to help the inquiry into the paroles. The committee learned that Mr. Truman's friend and onetime campaign manager, Paul Dillon, a Missouri lawyer and politician, received a $10,000 fee from gangster Campagna's wife for his professional services in getting Campagna paroled. Mrs. Campagna testified that she received a bill from Dillon in this amount and paid him by cashier's check in November, 1947. Dillon told the committee that lie went to Washington and appeared before the United States Parole Board in Campagna's behalf. While in Washington he visited the White House and was entertained by President and Mrs. Truman. Dillon denied that his friendship with the President was used in connection with the paroles. He said he had managed Truman's senatorial campaign in the St. Louis area in 1934. On June 16, 1948, the House Expenditures Committee recommended that the four Capone gangsters be sent back to prison and that their paroles be revoked. In a carefully worded report the committee held that the paroles had been improvidently granted, and identified two lawyers in the case as personal friends of President Truman and Attorney General Clark. They were Dillon and Maury Hughes of Dallas, Texas, who, the report said, were "in a position to exert influence on those in authority." The committee conceded that it had adduced no evidence whatsoever to indicate that President Truman had any knowledge of the matter. They further stated that there was no evidence that anybody had been bribed, but concluded that someone had spent big money to get the gangsters released. The committee failed to learn the source of the money. As a by-product of the Congressional inquiry it developed that Campagna's good fortune did not end with his being sprung from prison. In addition, some good Samaritan settled the government's income-tax claim Of $500,000 against him for $78,000, cash on the line. Gangster Campagna didn't know a thing about it, didn't know how much had been paid, or the source of the money. "Do you believe in Santa Claus?" demanded Representative Hoffman. "Yes, I do," replied Campagna, dead-pan. Campagna's lawyer, Eugene Bernstein, came forward with the information that he had paid the $78,000 to settle the tax lien. Where did he get the money? Bernstein's explanation was unique. People he didn't know just gave it to him, that was all. "Eight or nine persons came into my office at different times and plunked down $10,000 or so on my desk and said, 'This is for Louie.' I gave them a receipt, but I don't know who they were," said Bernstein. In January, 1948, Bernstein was indicted for making and conspiring to make false statements to a government agency. Without admitting that it had made a "mistake" or that it was acting on the recommendation of the House Committee, the Federal Parole Board quietly ordered the return of three Capone gangsters to prison, charged with violation of parole. Purged of the vicious influence of Browne and Bioff and the Capone gang, the International Alliance of Theatrical Stage Employees now enjoys a good reputation as a labor union, although it has been involved in some violent jurisdictional strikes; that is, disputes for power with rival unions. There has been no evidence of continued gangsterism in the union. It regards the Hollywood extortion conspiracy as a black page in its history. It does not apologize, but cites its past as an example of what can happen to a union when criminals manage to obtain control. Since the union leadership has turned over a new leaf, the rank and file has benefited in higher wages and better all-around working conditions. Browne and Bioff, those noted labor leaders, never earned their membership a plugged nickel-by their own admission. A question that never can be answered is whether the Hollywood tycoons might have withstood the onslaught of Browne, Bioff, and Co. had they made a real effort to call the racketeers' bluff in the very beginning. As is too often the case, these powerful and vastly wealthy businessmen allowed themselves to be pushed around and intimidated by a couple of two-bit hoodlums rather than risk the possibility of foregoing a little profit. pps. 14-33 --[cont]-- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, All My Relations. Omnia Bona Bonis, Adieu, Adios, Aloha. Amen. Roads End <A HREF="http://www.ctrl.org/">www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are not allowed. Substance—not soap-boxing! 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