The Outfit (11 page)

At the same time, Kennedy worked for Guy Currier’s Boston investment firm, and when Currier was away, Kennedy scrutinized his private files to gain insider information. Currier’s family now says that Currier felt double-crossed by Kennedy, whom he believed to be corrupt.

In 1929, Kennedy attempted a hostile takeover of the California-based Pantages theater chain. When owner Alexander Pantages balked, Joe Kennedy paid a seventeen- year-old girl $10,000 to accuse Pantages of rape. Pantages was charged and sentenced to fifty years in prison (later reversed), and Joe Kennedy got the theater chain at a greatly undervalued price. Four years later, when the girl wanted to admit her role in the frame-up, she suddenly died, apparently of cyanide poisoning. On her deathbed, the twenty-one-year-old admitted her conspiracy with Kennedy, who had promised to make her a film star (see Ronald Kessler,
Sins of the Father,
pp. 51-59).

It has been well documented that Kennedy used insider information to ’sell short’ before the 1929 stock market crash, making millions off the misery of his fellow citizens.

2
. The role of Ness went to Kevin Costner, who appeared to be making a career of historical misrepresentations when, in the 1991 film
JFK,
he portrayed the bullying New Orleans district attorney Jim Garrison as Jimmy Stewart reincarnated. Costner continued the theme in 2000, when he starred in and produced the dramatic recreation of the Cuban missile crisis
Thirteen Days.
In that role he played presidential adviser Kenny O’Donnell, who had no known input in the crisis; virtually all of “O’Donnell’s” actions and words in the film are invented.

2.

Curly’s Racket:
The Union Takeovers

Honest to God, we’ve been in the wrong racket all along.

-Al Capone to Curly Humphreys, 1930

O
ne of the first enterprises embarked on by Al Capone’s heirs was in fact initiated during the Big Guy’s reign. Local lore holds that soon after his recruitment into the Syndicate, Curly Humphreys explained to Capone how the dreadful state of labor-employer relations could work to the gang’s benefit. Humphreys had once again absorbed the essence of recent American history, churned it around in his cranium for a while, and produced a synthesis that would benefit both him and his gang. It was classic Humphreys, displaying the great foresight that saw him dominate the early years of the Outfit’s reign.

In 1886, when the American Federation of Labor (AFL) was formed, workers began enjoying a period of great success. With improving wages and workplace conditions, laborers finally had a voice to be reckoned with: the union. For four decades, laborers enjoyed the benefits of unionization, until a post-World War I recession ended the party. Throughout the Roaring Twenties, unemployment quietly rose, as wages began dropping. In addition, the corporate world began to employ the same Communist-scare tactics that the anti-ethnic groups had used in proselytizing the virtues of alcohol prohibition. Given the nation’s postwar patriotic fever, Americans were coaxed to equate “workers” and “unions” with Marxist philosophies. Those who remained loyal to the unions were marginalized as Bolsheviks. With labor relations rapidly deteriorating, the workers’ unions seemed impotent against the onslaught of antiunion sentiment.

Union membership thus dropped from a prewar high of four million to two million by the late twenties. Employers now felt emboldened to enforce strikebreaking, blacklisting, and vigilantism in their antilabor fervor. The corporate world appeared to be trying to undo labor’s four decades of success.

Employers lost their advantage when businesses began failing by the thousands. Given the precarious atmosphere, businessmen wanting to remain solvent now desperately sought concessions from the workforce. But with workers already in near revolt and the battle lines long-since drawn, the two sides were locked in a chaotic economic free fall. Both employers and employees needed someone who would understand their plight and advance their interests. And Curly Humphreys saw his next great scam: He would offer to represent both sides, while in reality playing them off against each other as the Outfit robbed them both blind. The added beauty of the plan was that it exemplified a maxim that Humphreys had long since adopted as his personal credo: It is far easier to muscle in on established businesses than to build them from scratch.

Even before Humphreys was recruited by Capone’s Syndicate, the young Einstein of Crime had deduced the potential gains to be had in the operation later called labor racketeering. In 1922, at the tender age of twenty-three, an independent Curly had made a futile attempt to convince the milk drivers’ union to ally with the janitors’ union, giving them more than double the bargaining power with tenement owners. Humphreys was more successful in convincing elevator operators to allow him to extort high-rise dwellers. Curly put a simple proposal to the residents of the upper floors: “No pay, you walk up and down twenty floors every day.” To be sure, Curly Humphreys did not invent labor racketeering, but he was the only Chicago gangster capable of bringing out its full potential. The beauty of Humphreys’ synthesis was that he knew where the real profit was located.

The essential elements of a labor racket consisted of terrorizing small businesses into needing protection (euphemistically called a
trade association),
for which they paid a percentage of their gross income. Simultaneously, as perfected by Humphreys, the racketeer represented the workers
(a union
in name only) in their grievances against their employers and their trade associations. It was perhaps the most laughably obvious conflict-of-interest arrangement that has ever existed.

In the Chicago of the 1920s more than two hundred such rackets existed, with names that covered every conceivable business with any income worth extorting: the Concrete Road, Concrete Block, Sewer and Water Pipe Makers and Layers Union; The Jewish Chicken Killers; The Kosher Meat Peddlers’ Association; The Master Photo Finishers; The Newspaper Wagon Drivers and Chauffeurs; The Vulcanizers Union; The Undertakers; The Excavating Contractors; The Master Bakers of the Northwest Side; The Distilled Water Dealers; The Street Sweepers Association; and so on.

Al Capone agreed with Curly’s assessment and began planning phase two of his regime, with Curly Humphreys to have a prominent role. Once Capone gave Curly the go-ahead, the takeovers commenced. Humphreys was prescient enough to know just where to turn for an insider’s education into the labor situation: George “Red” Barker. Barker was a bookkeeper by trade, and an avid reader and scholar. But his intimate knowledge of the labor situation inspired his recruitment by Humphreys and Capone. Through his connections with bankers and financiers, Barker obtained union balance sheets and details of the size of their individual treasuries. With Barker’s advice, Humphreys and Capone decided which unions and associations were ripe for takeover. Barker’s first victory for Capone was in taking over the seat of Local 704’s president, James “Lefty” Lynch, on the Teamsters Joint Council.

Local 704 represented the Coal Teamsters, responsible for much of the fuel deliveries to the lucrative Loop area of downtown. The takeover of such a union would allow Capone’s boys to extort all the hotels and businesses when the bitter cold Chicago winter hit. Lynch had unwisely decided not to step down voluntarily and consequently had both of his legs shot out from under him by Capone’s enforcers. At the next council meeting, his chair was assumed by Barker, with no objections from the other petrified council members. In short time, Barker raided 704’s treasury and transferred virtually the entire bounty into Capone’s bank account. When winter hit, the extortions began, with Capone actually passing on some of the largesse to coal-truck drivers, who received handsome wage increases.

Barker also orchestrated the takeover of the Ushers’ Union. At the time, Chicago utilized thousands of ushers at movie theaters, burlesque houses, ball games, prizefights - virtually any indoor or outdoor event. Typically, Barker not only forced promoters to use his union, he had the businessmen bribe him to underpay his workers. In typical racket style, both sides were played.

Having proved his value, Barker became Curly Humphreys’ right-hand union adviser. Barker’s relationship with Humphreys was not a one-way street, however, as Barker learned the art of “persuasion” at the foot of the didactic master; whenever possible, Curly coaxed and cajoled his targets, explaining how he alone could deliver both the worker and the employer from the throes of underpayment and/or overpayment, depending on whom he was cajoling. When his charm failed, Curly resorted to threats and kidnappings, quickly earning a reputation as Chicago’s premier kidnapper. The abductees were rarely harmed, and although ransom was demanded, the focus of the slugging was the takeover of the organizations.

Curly got his start in big-time labor racketeering when he fixed his crosshairs on a prey that proved surprisingly easy to bag: the Midwest Garage Owners Association (MGOA). At the time the Syndicate began focusing on labor racketeering, David “Cockeyed Mulligan” Albin owned the MGOA, a modestly profitable operation. Curly Humphreys saw a quick and easy way for garage owners, and the Syndicate, to increase their cash flow exponentially. But first Humphreys had to take over the MGOA. That was quickly accomplished when Curly and his partner, George “Red” Barker, paid a visit to Albin.

As was his style, Humphreys attempted to cajole Albin into bringing in the Syndicate as his partner, adding that Albin would be wise to stop attending association meetings; Curly would be MGOA’s new mouthpiece. Albin declined Humphrey and Barker’s overture, and the gang was forced to ratchet up the stakes. One night, Syndicate enforcer Danny Stanton came to Albin with
his
partners, Smith & Wesson, leaving Albin to agonize over a bullet wound through his foot. Like Lefty Lynch of Local 704, Albin was never again seen at an MGOA meeting, his chair now occupied by Curly Humphreys.

Humphreys had reckoned that if automobile vandalism rose drastically, it would be far easier to convince car owners to garage their vehicles. Therefore, next, a willing group of thugs were enlisted to do the dirty work. For that, Humphreys and Barker turned to the 42 Gang, a group of young toughs from the Maxwell Street area who specialized in just such malevolence. The gang, which consisted of dozens of young boys who revered Ali Baba and the Forty Thieves, adopted their name when they realized they had two more members than Baba’s claque. (One future Outfit boss, Salvatore “Mooney” Giancana, would rise from this gang after a stint as Joe Accardo’s wheelman.)

As per Curly’s plan, the gang spread throughout Chicago, often led by Humphreys himself, wielding ice picks to puncture hundreds of car tires. Soon, a newspaper ad appeared, taken out by Humphreys’
MGOA,
offering the union’s secure garages to the troubled car-owning populace. When the MGOA’s business doubled overnight, the Outfit collected not only their monthly association dues, but an additional kickback for each car stored. For their efforts, the 42 Gang would collect 10 percent of the take.

Invariably, some disabled cars were left unrepaired for a time, but Curly had that covered as well. After a few palms greased at City Hall, the MGOA became Chicago’s official car-towing contractor, hauling off the now ticketed vandalized vehicles. Policeman issuing the tags received a five-dollar kickback.

Although Humphreys proceeded to maneuver his way into scores of unions and associations, he was far from fulfilled in his racketeering ambitions. The young schemer quickly realized that there was no real money in associations with such arcane names as the Golf Club Organizers, or the Safe Movers. The real plums were intimately tied to the Windy City’s position as America’s service industry capital, and to the beverage that was in even more demand than booze. Thus the Outfit, under the expert counsel of Curly Humphreys, set their sights on the cleaning industry and the milk business.

The Laundry Wars

Chicago’s hotel industry, to say nothing of its countless brothels, required hundreds of thousands of sheets and towels to be cleaned every day. This, combined with the personal needs of millions of residents and tourists, meant that the revenues of the cleaning business actually rivaled those of bootlegging. At even a few cents per item, simple mathematics demonstrated that the laundry trade was the place to be. With the Outfit’s huge two-faced “protection” fees added on, the profits could be astronomical.

In anticipation of a future career as a laundry kingpin, Curly Humphreys took his first step by acquiring his own laundry businesses. In the case of the Boulevard Cleaners, owner Paddy Berrell was paid an early-retirement buyout of $35,000 to let Curly take over. It is anyone’s guess how Humphreys came to own the long-established Drexel Cleaners, but the acquisitions were brilliant strokes that, like all of Curly’s ventures, served multiple purposes: They gave Curly a “front” job to legitimize his income; and they gave the Syndicate somewhere to practice creative accounting, making moneys disappear and reappear as needed. The in-store book work was handled by Curly’s first wife, Clemi, while Jake Guzik held up his end at the Syndicate headquarters. Humphreys’ second wife, Jeanne Stacy, laughs when recalling a Curly pun that she firmly believes was its first usage: “He used to joke about the money he was hiding at his laundry. He called it ’laundering money.’”

But most important, Humphreys’ ownership of laundries like Drexel and Boulevard gave him a foothold in the industry he would soon engage in a massive hostile takeover. Curly considered it going to school. As a strong believer in adult education, Humphreys knew that to successfully take over the laundry business, he had to first learn the business from the inside. In addition, as a bona fide boss in Capone’s organization and a legitimate member of the dry-cleaning business, Humphreys now possessed a double-barreled arsenal he could use to cajole both the employers’ trade associations and the workers’ unions.

By the time Capone and Humphreys targeted the laundry industry, Walter Crowley was already running the scam for the upperworld. As manager of the Master Cleaners and Dyers Association, Crowley oversaw the terrorizing of hundreds of small neighborhood tailor shops, forcing them to submit to his protection association. The tailor shops were not desired for their minimal “tailoring” profits - sewn buttons and so on but for their role as drop-off points for soiled linens and clothing. These items had to be jobbed out to huge central cleaning facilities, where the profits were infinitely larger. Recalcitrant shops were burglarized and bombed, or acid was thrown on the clothes they had consigned. With many of the little shops in line, Master Cleaners made its first tactical mistake by launching assaults on the holdout shops that had combined to form their own protective association, the Central Cleaning Company. Crowley hired thugs who took brass knuckles to the faces of Central’s drivers; delivery trucks were overturned; clean garments were smeared with oil, and when that failed to work, they were sprinkled with acid. The immediate beneficiaries of all the terrorizing were the hired sluggers, the best of whom could earn a tidy $1,000 a week.

In desperation, Central’s president, Ben Kornick, turned to the North Side gang, led by George “Bugs” Moran, for protection. The North Siders were paid $1,800 per week to have their enforcers ride shotgun on Central’s delivery trucks. Kornick’s strategy succeeded, and Crowley’s Master Cleaners backed down, only to redirect their arsenal at Morris Becker’s operation. It was the beginning of the end for Crowley, and the entree that Humphreys, quietly running Drexel Cleaners, had long awaited.