Crime Hunt in Foley Square

The Kefauver committeemen rolled into the nation's largest city last week for the big finale to their investigation of organized crime in the U.S. Before they were done, they had made the legendary Frank Costello squirm in view of millions of television watchers, and provided titillating evidence that unobtrusive Frank Costello was just what they had claimed --the boss of one of the nation's two big crime syndicates (TIME, March 12). They had also charted some tortuous trails that led straight out of Costello's underworld and wound up in ex-Mayor William O'Dwyer's anteroom.

The dignified law chambers of Foley Square had never seen anything like it--even during the dramatic trials of Alger Hiss or the Communist Party hierarchy. Curious spectators stood for hours in pushing lines for seats to the small upstairs room, finally forced the committee to move down, to a big third-floor courtroom. There flashbulbs flared like heat lightning through the forest of television and newsreel cameras. From the judge's bench, mild-mannered Estes Kefauver presided with a firm hand, as Chief Counsel Rudolph Halley, an able, professionally annoying examiner, hammered at the unhappy witnesses. At Kefauver's right sat Maryland's judicial-mannered Herbert O'Conor, Wyoming's Lester Hunt and New Hampshire's pious old Charles W. Tobey, no lawyer, who glared with Yankee outrage at uneasy officials and sullen thugs, burst out at intervals to denounce the sinners, once with such eloquence that he moved himself to tears.

The Groundwork. Counsel Halley had carefully laid the groundwork for his case against Frank Costello. First he called in a grey, glib Manhattan lawyer named George Morton Levy, who runs Long Island's Roosevelt Raceway (harness horses). Witness Levy admitted unabashedly that he regularly played golf with Costello, Bookmaker Frank Erickson and an internal revenue agent named Schoenbaum, and under Halley's persistent prodding, told a tale of Costello, the Boss of Bookies. Levy testified that in 1946 the New York racing commissioner threatened to revoke the track's license if he did not get rid of the bookmakers who were operating there. Levy instantly thought of his golfing friend Costello, and hired him to keep gamblers away from the track. He paid him $15,000 a year for four years. Overnight, the bookmakers magically disappeared.

Then a garrulous, emaciated Republican politician named Charles Lipsky, who announced himself as a good friend of O'Dwyer's, added some illuminating details about Costello the Boss Politician.

Demanded Chief Counsel Rudolph Halley: "Based on your years of experience in politics in this city, did you believe it was necessary to get Costello's backing for your candidate?" Said Lipsky: "I did that. That's why I went to see him."

Two secondary villains--Joe Adonis, a sleek and handsomely sullen hood, and burly Bookmaker Frank Erickson--glowered briefly at the committee, answered no important questions, and departed, Adonis to his comfortable home in New Jersey, Erickson to his jail cell, where he is serving two years for bookmaking. The stage was set for the leading heavy of the piece.

Costello on the Offensive. Next day in walked well-tailored Frankie Costello himself, looking arrogantly down his commanding nose. Television cameras followed his deliberate progress to the stand; the committee members craned and nervously shuffled some papers; spectators peered and murmured under the beating lights.

Costello at once took the offensive. Through his lawyer, George Wolf, he protested the television cameras. "Mr. Costello doesn't care to submit himself as a spectacle," Wolf declared loftily. Anxious not to lose their star, the committee agreed that Costello's face should not be televised (see RADIO & TV).

Costello coolly set out to explain his deal with Lawyer Levy: "I says, 'What way can I help you?' I says, 'Well, what I can do, George? I can spread the propaganda around that they're hurting you there and you're a nice fellow, and I can tell them that if there's an arrest made, it's going to be very severe. I don't know how much good it's going to do you, but I'll talk about it.' "

Halley: "Who did you talk to about it?"

Costello: "Anybody that was around a

saloon or a bar--at Dinty Moore's or

Gallagher's. At the Waldorf, anywhere I had lunch. At the Colony." Halley: "What did you do in 1946 to earn $15,000?"

Costello: "Practically nothing ... I don't think I did a damn thing."

Costello's Income. Costello seemed never to have any difficulty getting money from associates. When he wanted $25,000, he could (and did) get it from Frank Erickson "without hesitation." He endorsed a note for $325,000 for his New Orleans partner "Dandy Phil" Kastel ("That was just accommodation," said Costello, "pure friendship") in a deal to buy into the Whiteley Distilleries, makers of King's Ransom Scotch, but insisted he had gotten "absolutely nothing" out of it.

The committee pursued him doggedly on his income. He admitted he got an $18,000-a-year salary from the Beverly Club outside New Orleans as "a good-will man." He had a sort of "little strongbox" at home, where he kept "a little cash," but couldn't remember how much. When his memory still refused to cooperate, Tobey tartly suggested that one way of finding out was to send someone up to look. Costello abruptly remembered that he had about $50,000 or so in the box, another $90,000 to $100,000 in his bank account.

Costello on the Defensive. Boss Costello was beginning to lose some of his earlier confidence. His voice rasped more hoarsely; he mopped his brow more & more often.

Halley produced Costello's 1925 naturalization papers, noted that he had failed to state he had once used the name Frank Severio, and that he had denied he had been in the bootlegging business. At that, Halley whipped out Costello's testimony to the state liquor authority in 1947, admitting he had bootlegged from 1923 to 1926. Said Costello sulkily: "I didn't sell no liquor prior to '25. I might have expressed it the wrong way . . . But now, to my recollection, thinking it over . . ." Observed Senator Tobey: "Is not the man who made the false affidavit susceptible to deportation?" Costello winced, and his voice got suddenly hoarser. Said Tobey: "I will talk to you later."

Then Halley threw another harpoon. Innocently, he asked Costello if he had ever paid anybody to check his telephone for wire tapping. "Absolutely not," said Costello.

A Matter of Perjury. A heavyset, greying man named James F. McLaughlin took the stand. He testified that he used to work for the telephone company, that in 1945 Costello asked him to check his telephone. Two or three times a week for about three months, he checked Costello's phone, and Costello handed him $50 or $100 when he saw him outside the Waldorf-Astoria barbershop. He had arranged a code with Costello. When Costello's line was tapped, "I would call him at his apartment and just say, 'This is Jim, everything isn't well,' or words to that effect." When it was not tapped, "I would say, 'Jim, I am feeling fine today.'"

The committee had caught Costello in a clear case of perjury. Next day, Costello came back to the courtroom looking ruffled, shrunken and malevolent. His throat was inflamed, the television lights bothered him, and he was in no condition to testify further, his lawyer declared. Mild-mannered but firm, Kefauver insisted he should try to answer a few questions. Rasped Costello: "I want to testify truthfully and my mind don't function . . . With all due respect for the Senators--I have an awful lot of respect for them--I am not going to answer another question ... I am going to walk out."

And walk he did, with the threat of contempt ringing in his ears. Next day he was back, honking into his handkerchief, while Lawyer Wolf flourished a doctor's certificate. "I refuse to go further with the questioning . . . until I feel fully well and capable," Costello croaked, and walked out again.

But Costello was nearer to prison than he had been since the day in 1915 when he was caught carrying a pistol. He faced a perjury charge, contempt of Congress, and he might be subject to deportation as well. In three short days, Frank Costello could see the destruction of the power and the respectable veneer he had been 35 years abuilding.

Spotlight on Saratoga Springs. While Costello considered the consequences of his walkout, the committee turned its spotlight briefly on Saratoga Springs, just 30 miles from Governor Tom Dewey's capital at Albany. Saratoga Detective Walter Ahearn gulped, squirmed, and like to have swallowed his gum under Senator Tobey's outraged questioning, as he admitted that he regularly escorted the night's cash from the downtown bank to two gambling clubs. He got $10 a day for this service, he said, from the Piping Rock Club (where Costello used to own a piece) and $50 a week from the Arrowhead Inn, where Meyer Lansky, Joe Adonis and Detroit's Lefty Clark run the tables.

Superintendent of State Police John A. Gafmey admitted that he had bottled up a report on Saratoga's wide-open gambling, but pleaded it was contrary to policy to take action in cities. Tobey exploded like a rusty pinwheel. "You did nothing. You were a cipher, a zero!" he roared. "If I were the governor of this state, I would give you just five minutes to get out of the place or I would kick you out." Mumbled Gaffney humbly: "I am glad you aren't the governor."

The Story of Virginia Hill. Counsel Halley had one more diversion before he went back to the main theme. In flung Virginia Hill, queen of the gangsters' molls. She was soignee in a platinum mink stole and picture hat. She was also cursing the photographers. "Make them stop doing that; I'll throw something at them in a minute," she told Kefauver angrily. Then, while the Senators listened breathlessly, Virginia told her simple tale of how a 17-year-old waitress from Alabama met a friend of big-time bookies named Joe Epstein, and started along the road to fame and riches.

Virginia, who is now 34 and married to a Sun Valley ski instructor, admitted knowing just about every nobleman in Big Crime's hierarchy--Joe Adonis, Costello, Meyer Lansky, Charles Fischetti. But she didn't admit much more. Lolling negligently at the witness table, Virginia explained her unlimited income in short bursts of Alabama drawl: "I went with fellows. Like a lot of girls they got, giving me things and bought me everything I want . . . Whatever I ever had, outside of betting the horses, was given me."

With no apparent embarrassment, she explained her breakup with her longtime friend Ben ("Bugsy") Siegel, who was killed in the house he had rented for her in Beverly Hills. "I had a big fight with him because I hit a girl in the Flamingo and he told me I wasn't a lady ... I had been drinking and I left, and I went to Paris when I was mad."

With her long acquaintance with all these racketeers, didn't she ever hear about their businesses? When they talked business, she left the room, she said. At Siegel's Flamingo Club in Las Vegas, "lots of time, people didn't even know I was there. I was upstairs in my room. I didn't even go out. I was allergic to cactus." thing?" "You just asked didn't Halley. want to know any Said Virginia: "No, sir, I didn't want to know anything about anybody." With that, she shrugged her mink stole higher on her shoulders, ran a gauntlet of photographers, paused to shout, "You god dam bastards, I hope an atom bomb falls on all of you." Near the door she slapped a woman reporter for good measure. Even for Ginny it was quite an exit. The senators, a bit flustered, had learned exactly nothing about her suspected role as bank courier for the overlords of U.S. crime.

Of Rackets & Politics. Halley turned back to the shadowy connections between New York's politicos and New Yorks bosses of crime. Costello had walked out before the Senators could grill him on his relations to Tammany politics. But they could explore Tammany politicians and the men around Mayor O'Dwyer for traces of the underworld's power. While O'Dwyer himself flew into-town from the embassy in Mexico to testify, the committee hus tled a whole covey of O'Dwyer's political friends and underlings onstage.

An assistant state's attorney general testified that he had often seen O'Dwyer in Joe Adonis' Brooklyn restaurant in the '30s, along with other politicians; he thought it might have been O'Dwyer who introduced him to Adonis. A county pros ecutor estimated that police protection in Brooklyn amounted to about $250,000 a bookmakers.

Moron, the Right Bower. But the key man was big, beefy James J. Moran, a jaunty, florid, Irish-politician type. Once a court clerk, Moran had long been Wil liam O'Dwyer's political right bower. As O'Dwyer rose, so did Moran. When O'Dwyer became mayor, he made Moran first deputy fire commissioner and let it be known that all things political were to be "cleared with Jim Moran." As a last act, the departing mayor had appointed him to his lifetime $15,000-a-year job as a city water commissioner.

Moran was bluff and confident. He testified readily that he arranged a meeting for O'Dwyer with Costello in 1942 or 1043 O'Dwyer was in the Army at the time and was investigating a rumor that Costello was "mixed up with some people who were making trouble for the Army at Wright Field." Moran knew just how to get hold of Costello; he called Michael Kennedy, then leader of Tammany Hall.

Two weeks later, O'Dwyer went to Costello's apartment with Moran and stayed an hour. Moran did not know what they talked about.

Moran & the Policy King. After that, Moran met Costello often in restaurants and as Costello had testified, frequently dropped in for a drink at his apartment.

Did Moran know a racketeer called Louis Weber, onetime policy king of Brooklyn? He did. Weber had been "around politics" for years, he explained.

Halley: "Was he also a frequent visi tor at your office when you were deputy fire commissioner?" Moran: "It is possible that Weber came in my office three times during that period."

Halley: "Is it possible he came much more often?"

Moran: "No, sir, it is not--He came in around Eastertime with a little bottle of perfume that he gave me, that I thought was, well, a damn nice thing for anybody to do."

There was a stir and a squat, sullen-looking Puerto Rican was brought in. He was Louis Weber. Then a husky fireman came in and sat down beside Moran. He had been assigned as receptionist outside Moran's office. He identified Weber and declared nervously but positively that Weber had visited Moran "about 50 times." ,

Moran swung around and glared i fireman for a long moment of silence. "Ridiculous!" he snapped. Pushing at the crowd around him, he demanded: Can I get the hell out of here?" He could, with a possible charge of perjury hovering over his head.

This week Ambassador Bill O'Dwyer faced the Senators. Extra chairs had been dragged in, standees crowded around the witness table. "I need those mikes--to talk to the people," said O'Dwyer. Twiddling a paper clip, he rambled over an account of his whole career ("I took 190,000 people out of the slums"), soliloquized at length that crime was bred by Prohibition mint machines, and "tattered nerves, wash-line disputes and arguments over children." ,

O'Dwyer admitted that he had visited Costello's apartment as an Army investigator, that he saw two Tammany leaders there. Senator Tobey, who had been heckling O'Dwyer off & on all day, broke in. Snapped Tobey: "It almost seems to me as though you should say 'unclean, unclean,' as the old Romans practiced it, and that you would leave him alone, as they do a leper."

O'Dwyer: "You have bookmaking all over the country, even in New Hampshire, $30 million a year."

Tobey: "We haven't a Costello in New Hampshire."

O'Dwyer: "Well, I wonder ... I wonder who the bookmakers in Bretton Woods support for public office."

Tobey: "Well, I will tell you one that they did not support, and he is talking to you now."

O'Dwyer: "And I can tell you that you don't know who supports you, because you sent here for money, to help you i your primaries and your election, and you got it and you don't know where it came from."

Tobey: "I didn't send to New York--"O'Dwyer: "You called up."

Tobey: "Well, I didn't get any--" O'Dwyer: "Well, would you like to go into that?" "

Tobey: "Yes, I would. I challenge you.

O'Dwyer: "All right. Is there a Mr. Rosenblatt in the room?"

There was a moment of breathless silence. There was no answer. But after that, Senator Tobey of New Hampshire was noticeably mumchance, and Ambassador O'Dwyer became noticeably self-possessed.

Negligently, he conceded that Costello undoubtedly had an influence with Tammany, but not with him--though he admitted that Costello's friend Irving Sherman had helped him in a mayoralty < campaign. If there was corruption m his administration, well, he had been deceived.

Personally, he was against corruption. Bill O'Dwyer left the stand more composed than he mounted it.

But the Senators were not through.

Frank Costello reappeared on the stand.

His voice miraculously recovered, he began to tell all about the power he wields in Tammany Hall. And the Senators were planning to have another go at O'Dwyer himself.

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