The Valachi Papers (16 page)

Even so, the going was not especially easy at first for Valachi. He had come into the Cosa Nostra too late to amass the kind of money from bootlegging that financed the move of so many other members into various industrial, labor, real estate, and gambling rackets when Prohibition ended. Although in the long run the odds are fantastically in favor of the numbers operator, there are inevitable losses that he has to absorb from time to time. Valachi learned this the hard way:

Bobby and me are only operating for maybe three weeks, trying to build things up little by little, hoping we won't get hit too bad. Well, this number pops that
's
got
$12
or
$14
on it,
I
think
$14,
and after we pay off our controllers and runners, we only had about
$1,700
net that day and only a couple of thousand more in the bank. Now you can see how much we got banged for. We got hit for $8,400. That was a pretty good hit in those days. I don't know what I'm going to do. I call Willie Moretti and I tell him, "Tomorrow I'm bringing my wife over to your house. You support her."

Willie says, "What's the matter?"

"I'll tell you what's the matter," I say. "We got wiped out. We got nothing."

"All right," Willie says, "don't pay off. Stall your people."

So when all the runners come around that night, we tell them it ain't official yet, there's something wrong, and we got to wait for twenty-four hours.

Then, when the bets come in the next day, Willie calls and asks for a couple of our bad numbers—the ones with the biggest play on them. You see, he is going to try to lay them off for us so we don't get hit too hard and help pay off for the day before. But it ain't easy. He calls around to some other banks and tells them, "Listen, some of our friends got wiped out. How are these numbers for you? Can you handle them?"

Well, the other banks are getting too much play on these numbers, and we give Willie the next worst number. If it has to be, it has to be. Willie tells us he will handle it personally. He will accept $5 on the number to cover us, but not to make a habit of it. So we sweat it out and get through the day. But this ain't no good working without any money. We were lucky, but how lucky can we stay? The way it's going, me and Bobby ain't booking numbers, we're gambling ourselves.

Valachi's Family boss, Charley Lucky Luciano, bailed him out. Luciano's father had died, and Valachi went to the wake. While he was there, Luciano came over to him and said, "Hey, Joe Cago, don't look so sad."

It was a rare opportunity to speak directly to Luciano, and Valachi made the most of it. "Well," he replied, "I'm sad for your trouble, and to tell the truth, I'm a little sad for myself. I'm going broke in the numbers."

Luciano promptly instructed Valachi's old pal Frank Livorsi to provide him with some working capital. Livorsi gave Valachi $10,000. In return, Livorsi, Joseph Rao, and Joseph (Joe Stretch) Stracci became partners in the operation. Valachi and Doyle, however, were responsible for running it on a day-to-day basis, and to assist them, they took on a chief controller named Moe Block, who was an experienced numbers man. "You had to keep your eye on Moe," Valachi notes, "but he knew his way around and brought in some good controllers with him."

These controllers were vital to a successful numbers bank. For the most part Jewish, they were, in effect, branch office managers. As their title indicates, they also doubled as bookkeepers. This was one occupation that members of the Cosa Nostra rarely engaged in; accounting chores apparently were beneath dieir dignity, if not their ability.

Each controller had his own group of runners who actually collected the individual bets and returned any winnings. A controller got 35 percent of his daily gross if he was responsible for paying off the police in his area and 30 percent if the bank itself took care of this expense. The controller, in turn, gave his runners 20 or 25 percent of his share* "It was his business what he paid

^5!
"A runner also traditionally shares in a percentage of the winnings of one of his customers. If a player, for example, wins $600 on a SI bet, the runner deducts SI00 for himself.

them," Valachi says. "All we care is that their work comes in every day. If it don't, that's when we send for the controller."

From the time the numbers game received serious attention in the organized underworld immethately following Prohibition, it has blossomed into a racket currently thought to be taking in upwards of a quarter of a billion dollars annually in New York alone. It is unquestionably the chief source of police graft today. In a single precinct there may be fifteen or twenty locations—a tai-lorshop, a grocery store, a newsstand —where numbers bets are handled; to operate just one of them without police interference can require payoffs, to a patrolman walking his beat on up, amounting to $2,000 a month.

Nowadays bets usually start at a quarter, $1 bets are common, and $10 bets are accepted by the larger banks if they come from a regular" customer. In the Depression years when Valachi began, nickel-and-dime bets were more the rule; even so, the numbers bank controlled by Dutch Schultz had an average daily play of $80,000.

Valachi's own operation, with the infusion of cash from Frank Livorsi, finally got off the ground. Another tangible benefit resulted from the new partnership when Livorsi informed him that they would share in a numbers fix. While the parimutuel figures at New York tracks could not be rigged, the racing season there was much shorter than it is now, and once it was over, the winning combination was derived from the betting at other tracks which the underworld had infiltrated. Among them, according to Valachi, was the Fair Grounds in New Orleans, Chicago's Hawthorne track, and Coney Island in Cincinnati. "The way I understood it," he says, "Dutch Schultz had this guy who could figure out how much money to put in the mutuel machines to make the right numbers come out. I can't remember his name. It was hard to say.**

Thus launched, die partnership built up a $60,000 bankroll with a daily betting volume of around $5,000. Out of this, as his share, Valachi began drawing a nifty, tax-free $1,250 a week. There were also the advantages of belonging to the organized structure of the racket in New York. Once, when he stopped to check on a controller, Valachi learned that die day's bets had not been picked up yet and volunteered to take them to the main office himself. Later, as he was getting out of his car with the bets and policy slips in hand, he was stopped by two detectives. Although he had been paying off the local precinct police, the detective turned out to be from the commissioner's confidential squad, and, as he notes, "You couldn't do business with them." He was arrested, but when his case came up for trial, his previous arrest record was not given to the judge, and he got off with a suspended sentence. "I don't know how it was done," Valachi told me, "and I didn't ask no questions."

(Valachi's file, according to the New York City Police Department, shows that he was arrested on January 13,1936, on a policy charge and on September 12 received a suspended sentence in Special Sessions Court.)

Despite such prosperity and protection, when Valachi discussed his involvement in the numbers racket, he sounded more like a harried businessman than a rising racketeer. Except for the pure pleasure even he could not conceal while reminiscing about a fix—"I'll never forget that first number, 661; we won $7,000 and

^::
'Valachi is referring to Otto (Abbadabba) Berman, a mathematical wizard Schultz used not only for fixes at racket-controlled racetracks, but also to manipulate mutuel odds so that the most lightly played numbers in his bank won.

had a swell Christmas" —he much preferred to dwell on all the headaches of die operation.
A
constant cause for alarm were numbers that were regularly and heavily played. "We would get
222
a lot and
725,
don't ask me why," he recalls, "and always
000
from the coloreds." Worse yet was the trauma he experienced when some event of the day triggered a rush on a particular number:

We were using a New York track, so nothing could be fixed, when there was this big payroll robbery in Brooklyn. I think it was at some ice-cream company. Anyway they got away with $427,000. It was all over the front pages about being the biggest job ever pulled.*

Now everybody has to play 427. We must have had around $100 on it. If it hits, that means we get banged for $60,000. Naturally we can't pay off, as we ain't been in business that long. So I call this fellow who is with the LaSalle brothers to lay off the $100. But he, speaking to me as a friend, says, "You are wasting the $100. If that number hits the way it's being played, nobody can pay off. But I'll do something for you. I'll give you $40 on it."

"Would you pay off?"

"For you, yes."

"Gee," I say, "thanks."

To make a long story short, it don't hit. But believe me, I took notice of that number. The play on it kept getting weaker and weaker as time passed. Maybe three or four years after this, 427 finally pops, but not for much. I remember the bet. It was for fifty cents.

^:
'On August 21,1934, an armored truck on the Brooklyn waterfront near the Rubel Ice Plant was held up by ten masked gunmen who made off with $427,950. It was at the time the richest such haul in U.S. history.

Nothing, however, caused Valachi more distress than the attempts by both those in his employ and die world at large to, as he says, "clip" him or otherwise do him in:

You never knew what some people would be scheming next. Now my top controller was Moe Block, and one day he comes to me and says there are these guys out on Long Island who asked him if he was connected, meaning mobbed up. Moe says to me that he told them, "no."

"What did you say that for?" I say.

"I don't know," he says, "I just did."

Then Moe explains that these guys wish to come in with us. They want to turn in their work—which is what we call the envelopes with the bets in them—to us.

I ask Moe, "How far out on the island are they?"

"About three-quarters of an hour," he says.

I thought there was something fishy about the whole setup, but Moe says that just in case we think something is wrong, these guys want him to ride with them when they pick up the bets.

"Well," I say, "I still don't like what I've heard so far, but we'll see. If I find out I'm right, we won't pay off."

You got to remember that the first number in a winning combination comes from the first three races at whatever track we're using. What I don't like is that by the time Moe is back in the city with these guys, the first three races are going to be over. But we can always use more business, and I tell Moe we'll try it.

Well, Jesus, it happens. The first day they hit us with a $3 bet, and that's a $1,800 payoff. Right away I tell Moe to chart all this new work by itself. Now, if the first number in a winning combination leads off with a 4, there are only 100 possible ways to arrange the next two numbers—from 400 to 499. When I look at the board after Moe is finished charting, I see that in the work from these guys on Long Island, all 100 possible combinations leading off with 4 are up there. Of course, there are some other bets mixed in, so we don't get suspicious, but not enough when you saw them all lined up at once.

Now I wait for them to come and collect the money, but they call up instead. Before I can say anything, they are already yelling, "We didn't know you was connected! We thought you was independent. We just found out." Then they say to please not go after them. I say, "Why not?" and they say that after all, they asked Moe if he was connected, and if they had known the truth, they never would have done it.

Naturally I'm interested in learning the way they operate—who knows who else will try it?—so I say, "Okay, if you tell me how you clipped us."

"Well," the guy says, "by the time we are coming over the 59th Street Bridge, the first three races are in, and we know the first number is set. We find out what it is after we come off the bridge. There's a barbershop on the right, and one of our guys steps out of it and holds up four fingers as we go by. Now we've got ten envelopes, each leading off with a different number from 0 to 9. So when we get the high sign from our guy in the barbershop, we just give Moe the envelope with all the combinations that start with 4."

Can you imagine the nerve of them guys?

Moe Block also figured in an infinitely more ominous development that might have abruptly ended Valachi's underworld career had he not been backed by the Cosa Nostra. Among the controllers Block had brought with him in the numbers operations was a "guy named Shapiro." Shapiro, according to Valachi, was a valuable addition, since he regularly turned in between $300 and $400 a week. "That," he points out, "was big money then. You got to remember times were bad—what they called the Depression was on—and most of the bets was nickel-and-dime stuff. Today it's $1 and more. So you see Moe was impressed with Shapiro. In other words, diis Shapiro had him bulldozed.''

Shapiro apparently had ambitions to be more than a mere controller, and joined "two Jew boys," Harold Green and Harold Stein, in an attempt to muscle in on Valachi's numbers racket. Valachi had already heard of Green and Stein. "They are from around the Bronx somewhere," he says, "and they dunk they're pretty tough. Their gang has been sticking up numbers runners, bookies, everything you can think of." Valachi first learned of their interest in him when an obviously nervous Moe Block passed the word that Green and Stein had been asking "around" about him. "They mean business," Block added. "They are set to take over the city."

As was the case with anyone who worked for him, Valachi had said very little about himself to Block and nothing, of course, about the Cosa Nostra. "Moe only knows what I tell him," he says. "I just said to him that I can handle any trouble that comes along, and he should never worry. So I tell him to stop talking about how tough these guys are, or I'll start thinking things about him." Then he asked Block what Green and Stein knew about him.