The Mob and the City (33 page)

Even “local” officials who attacked the mob had first built up a political base in federal or state appointments. Before Thomas E. Dewey was elected Manhattan district attorney in 1937, he was the assistant United States attorney who obtained convictions of Waxey Gordon, and a state special prosecutor who convicted racketeers. Likewise, before Rudolph Giuliani became mayor, he oversaw federal prosecutions of the Mafia as the United States attorney for the Southern District of New York.
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This comparison is all the more impressive considering that the premier federal investigative agency was on the sidelines.

DIRECTOR HOOVER'S FBI, 1924–1957: HOOVER'S REFUSAL TO ACKNOWLEDGE THE MAFIA

The Mafia families were fortunate that the Federal Bureau of Investigation was
not
actually investigating them. For his first thirty-three years as FBI director, between 1924 and 1957, J. Edgar Hoover took few sustained actions against the Mafia. Indeed, Hoover refused to publicly acknowledge its existence.

Conspiracy theories have sprung up claiming Hoover was compromised by organized crime. In his bestseller
Official and Confidential: The Secret Life of J. Edgar Hoover
, Anthony Summers offered lurid stories of J. Edgar Hoover dressed in drag at Washington parties. He claimed that Meyer Lansky blackmailed the director with a photo of him in a dress.
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Summers's primary “witness” was Susan Rosenstiel, who had a conviction for attempted perjury, and who for years had been trying to sell her story for money.
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The story is absurd. Hoover would have been ousted had he been going to Washington parties in drag in the 1950s. Mobsters of that era dismiss the story. “Are you nuts?” said Vincent Alo, a partner of Lansky. “There was never no such picture. If there was, I'd have known about it, being so close to Meyer.”
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The truth about Hoover's reluctance is more complex, but ultimately more fascinating. A recently released FBI document of Hoover himself sheds new light on his beliefs. To understand the document, and Hoover's position on the mob, we need to understand the man and his times.
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Hoover's Overarching Purpose: Rooting out Spies and Subversives

Jay Edgar Hoover's top priority, his
raison d’être
, had always been rooting out spies and “subversives” from America. As a young special assistant to Attorney General A. Mitchell Palmer, Hoover enthusiastically planned raids on anarchists during World War I.
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When Hoover was appointed director of the Bureau of Investigation in 1924, he professionalized the scandal-ridden agency by reforming hiring and standardizing its procedures. He also expanded intelligence gathering on “subversives” like Socialist writer Theodore Dreiser. In 1929, Bureau agents even ransacked the New York office of the American Civil Liberties Union.
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Hoover was not always chasing ghosts though. During World War II, the FBI captured Nazi spies and saboteurs, and it began tracking secret agents of the Soviet Union. In 1943, the FBI recorded a Soviet diplomat paying a leader of the Communist Party USA (CPUSA) to develop intelligence on the Manhattan Project to build the atomic bomb. In 1947, the National Security Agency disclosed to FBI officials that under its “VENONA project,” NSA cryptologists had decoded messages indicating that Soviet espionage had penetrated the United States government.
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During the Cold War, Hoover turned the FBI into more of an internal security ministry than a law enforcement agency. He poured resources into counterintelligence indiscriminately, and he dangerously blurred the line between actual enemies of the state and political dissidents. These remained the FBI's top targets through the 1950s, even after the CPUSA had been decimated.
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Hoover had FBI agents assembling dossiers on teachers. “The bureau was sending raw and confidential file material on the suspected Communist activities of teachers to local school boards throughout the country,” said Attorney General Herbert Brownell, who stopped the practice.
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Hoover's tunnel vision came at a cost to other FBI functions. Even after anticommunists like Robert F. Kennedy and Senator John McClellan had expanded their attention to organized crime and racketeering in the 1950s, Hoover continued to obsess about the remnants of the CPUSA. As late as 1959, the FBI's New York field office had only 10 agents assigned to organized crime compared to over 140 agents pursuing a dwindling population of Communists.
⁵⁰
As a result, the FBI lacked adequate intelligence on the Mafia.

The Rise of the Mafia and the Kefauver Committee

By contrast, Hoover resisted investigating the “hoodlums,” as he called them. Given that the Constitution left most police powers to states and cities, the FBI's role regarding crime was unclear. Hoover declared his opposition to a “national police force” early on, and he lambasted corrupt cities where “the local officer finds the handcuffs on himself instead of on the criminal, because of political influence.”
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His position initially had much support among commentators and Congressmen.
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The Senate was controlled by state-rights politicians or segregationists like Strom Thurmond who disliked federal officers interfering in “local” matters.
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But Hoover was a federalist when it suited him. He exploited high-profile crime issues to increase funding for the FBI. In 1933–34, Hoover seized on the public clamor over Midwest bank robbers John Dillinger and Pretty Boy Floyd to lobby Congress to pass federal laws covering traditionally local crimes like bank robbery, kidnapping, automobile theft, and transportation of stolen property across state lines. According to one civil rights lawyer, “[Hoover] would say one day, ‘We are not a police agency.’ The next day for a bank robbery, kidnapping or auto theft, he would be a police agency. When it came to the Mafia or narcotics, ‘We're not a police agency.’”
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While Hoover was trumpeting questionable statistics about automobiles recoveries by the FBI, the bulk of new agents were assigned to gathering intelligence on subversives.
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As organized crime grew in strength, however, local officials began requesting assistance from the Department of Justice and the FBI.
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In March 1949, the head of the Crime Commission of Greater Miami (a second home to many New York
mafiosi
) warned that “the influence of the national crime syndicate is so great that where the group has rooted itself, law abiding citizens and officials are silenced either through wholesale corruption or through threats and intimidation.”
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In 1949, an organization of mayors wrote to the new attorney general Howard McGrath, stating, “The matter is too great to be handled by local officials alone, since the organized crime element operates on a national scale across State boundaries.”
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McGrath held a crime conference but did little else. McGrath and Hoover were reluctant to get the FBI involved in what they thought was purely “local” vice crime. However, McGrath and Hoover were
largely ignorant of the Mafia families, their cross-country networking, and their substantial effects on interstate commerce.
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Then, in April 1950, Kansas City mobsters Charles Binaggio and Charles “Mad Dog” Gargotta were found murdered in a Democratic Party club. (Binaggio was boss of the Kansas City Mafia with links to the governor). The
Kansas City Star
identified Binaggio as a “local representative of the national crime syndicate.” The
Star
called on “J. Howard McGrath and J. Edgar Hoover, head of the Federal Bureau of Investigation…to investigate and ‘break’ this syndicate.”
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These calls fell on deaf ears. On April 17, 1950, Attorney General McGrath testified before a Senate subcommittee that the Justice Department had “no evidence” of “any great national (crime) syndicate of any size.” In response, Senator Homer Capeheart called the statements “surprising.” He said that “either there is or there isn't a nationwide syndicate,” and that “the Attorney General should know about it.”
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McGrath, who'd only been in office eight months, was clearly relying on Hoover's FBI.

So instead, Senator Estes Kefauver seized the issue to secure limited (in retrospect inadequate) funding for Congressional hearings on organized crime in 1950–51. With a small staff of twelve investigators, and no real assistance from the FBI, Kefauver tried to prove the existence of the Mafia in hearings around the country. The Kefauver Committee hearings were a television sensation, with over six hundred witnesses, including such gangsters (and secret
mafiosi
) as Frank Costello, Carlos Marcello, Willie Moretti, and Paul Ricca.
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But the committee staff was overwhelmed, and they could not get an informant to testify publicly about the Mafia. “The committee found it difficult to obtain reliable data concerning the extent of Mafia operation, the nature of the Mafia organization, and the way it presently operates,” admitted the committee.
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“The committee has diligently, but unsuccessfully, pursued the trail of the Mafia,” wrote the
New York Times
.
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Nonetheless, as politicians are wont to do, Kefauver exaggerated his findings. For example, he claimed that “the Mafia today actually is a secret international government-within-a-government. It has an international head in Italy—believed by United States authorities to be Charles (Lucky) Luciano.” Although Luciano had been a New York boss, by 1951 he was idling in exile, and he certainly was not the “international head” of a “secret international government-within-a-government.”
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To Hoover, the parade of hoodlums was a distraction from the Communists. It shows in his testimony before the Kefauver Committee on March 26, 1951. That same morning, a federal jury in Manhattan was hearing evidence in the trial of Julius and Ethel Rosenberg for conspiracy to commit espionage, which Hoover would dub the “Crime of the Century.”
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In his testimony, Director Hoover never acknowledges the Mafia's existence. While witnesses from the Federal Bureau of Narcotics and the Justice Department repeatedly reference “the Mafia,” Hoover conspicuously avoids the word, instead dismissively referring to “hoodlums.”
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Hoover lectured the senators, saying that local authorities were responsible for hoodlums, while the FBI was responsible for “internal security” against “Communists and subversive forces.”
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In fact, Hoover cited his top priority (national security) in the process of turning down new FBI jurisdiction to go after organized crime:

Due in part to his own intransigence, Hoover got his way, and Congress passed no new federal laws for the FBI. The Mafia emerged unscathed, again.

Hoover's Disbelief in the Mafia

This brings us to the heart of the matter. Most theories about Hoover's inaction assume that he “must have known” about the Mafia's existence, but that he dissembled because he did not want to pursue it. A recently released FBI document and firsthand accounts by FBI agents point to another reason. Simply put, Hoover genuinely did
not
believe in the existence of the Mafia.

The Federal Bureau of Investigation had virtually no intelligence on the Mafia families, the largest crime syndicates in the United States, through the late 1950s. FBI Boston field agent Neil Welch remembers his fellow field agents circulating the Federal Bureau of Narcotics's lists of
mafiosi
because the FBI kept
no such information.
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As FBI Chicago field agent William Roemer observed, “Mr. Hoover had no knowledge of organized crime in the United States because except for a ‘special’ such as CAPGA (code name for ‘reactivation of the Capone gang’) in Chicago, which lasted just a few months in 1946, the Bureau had never investigated organized crime.”
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This deprived Hoover of even basic intelligence on the Cosa Nostra. There is no evidence that Hoover knew about the Commission or understood its interstate connections. There is no evidence that Hoover knew of the existence or structure of the five Mafia families of New York. In fact, between 1924 and 1957, the director of the FBI never publicly uttered the word “Mafia” or “La Cosa Nostra.”

The FBI's intelligence failure was exposed by its flat-footed response to news that dozens of
mafiosi
were caught meeting at Apalachin, New York, on November 14, 1957 (see
chapter 10
). When a Senate committee asked the FBI for intelligence on the attendees, the FBI had little to provide. “The FBI didn't know anything, really, about these people who were the major gangsters in the United States,” recounted Robert Kennedy, counsel to the Senate committee. “I sent the same request to the Bureau of Narcotics, and they had something on every one of them.”
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In the weeks after Apalachin, FBI officials were still denying the existence of the Mafia. On November 21, 1957, a reporter quoted an “unimpeachable source” within the FBI pooh-poohing the idea of a Mafia, saying “nothing of any substance has ever been shown in this respect, nothing has even come close to doing so.” Remarkably, the source acknowledged that “the FBI never has investigated the Mafia.”
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As late as January 8, 1958, an internal FBI report stated: “No indication that alleged ‘Mafia’ is an actual and existent organization in NY area, but is convenient term used to describe tough Italian hoodlum mobs.”
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